122421612 human resource
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HUMAN
RESOURCE
MANAGEMENT:
An integrative
approach
BENJAMIN MWANZIA MULILI
2
DEDICATION
To
My wife Emily Ndinda
And my children
Stephen Ndua
Judah Kiilu
&
Esther Ndanu
3
ACKNOWLEDGEMENTS
The process of writing this book was an uphill task. However, several parties
assisted me in different ways. It is therefore my great pleasure to acknowledge
their assistance. Nevertheless time and space do not allow me to mention all of
them.
First and foremost, I thank God for His blessings towards my life. The fear of the
Lord has been the source of my strength, knowledge, motivation, and the hope
for achieving my goals.
Secondly, I wish to acknowledge the Catholic University of Eastern Africa for
being a caring employer and for providing me with the opportunities to excel in
my career.
Numerous individuals participated in the process of reviewing this book. I wish to
thank the many students of Catholic University of Eastern Africa who provided
useful suggestions and examples.
Specifically, I would like to acknowledge the contributions of the following MBA
students. Christine Mulili, Felistus Chepchirchir, Teresa Kariuki, Wekesa Isabella,
Mark Karobia, Benard Gitangi, Mumbua Kioko-Ngalukya and Peter Kamau
However, any mistakes in this first edition are entirely my own and blame cannot
be projected to any other person.
My family members, especially my dear wife Emilly Ndinda, were there for me
all the time. Thank you for being unconditionally supportive to me.
To other parties that assisted me in one way or another, thank you so much and
God Bless!
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TABLE OF CONTENTS Dedication………………………………………………………………………..
Acknowledgements……………………………………………………………….
UNIT 1: NATURE AND SCOPE OF HUMAN RESOURCES MANAGEMENT.
Ch. 1. Role and functions of human resources management………….1
Ch. 2. Challenges of modern human resource management………….
Ch. 3. Creation and management of a HR unit…………………………..
Ch. 4. Human resource policies…………………………………………….
Ch. 5. Human resource information systems…………………………….
UNIT 2: PROCUREMENT
Ch. 6: Fair employment practices…………………………………………
Ch. 7: Human resource planning…………………………………………..
Ch.8; Recruitment and selection………………………………………….
UNIT 3: EMPLOYEE TRAINING AND MANAGEMENT DEVELOPMENT
Ch. 9: Employee training………………………………………………..
Ch. 10: Management development…………………………………….
Ch. 11: Career Development…………………………………………..
UNIT 4: COMPENSATION ADMINISTRATION
Ch. 12: Job evaluation techniques…………………………………….
Ch. 13: Compensation of employees and managers……………….
UNIT 5: INTEGRATION
Ch. 14: Directing employees…………………………………………
Ch. 15; Management of conflicts……………………………………..
Ch. 16: Labour relations……………………………………………….
UNIT 6: MAINTENANCE
Ch. 17: Employee health and safety……………………………….
Ch. 18 Human resource productivity…………………………….
Ch. 19 Performance appraisal……………………………………
UNIT 7: SEPERATION
CH. 18: Employee separation………………………………………
Ch. 19 Employee counselling…………………………………….
UNIT 8: HR RESEARCH, DEVELOPMENTS AND THE FUTURE
Ch. 19: Emerging issues in human resource management…..
Ch. 20: Global human resource operations……………………
Ch. 21: Organisational development and change--------
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CHAPTER ONE:
NATURE & SCOPE OF HUMAN
RESOURCES MANAGEMENT
Chapter objectives
This chapter introduces learners to the:
Definitions of management and human resource management.
Functions of human resource managers.
Importance of human resource management.
The shift from personnel management to human resource management.
Differences between personnel management and human resource
management.
INTRODUCTION
The discipline of human resources management is a part of the broader field of
management. Therefore, for one to fully understand and appreciate the study of
human resources management, it is necessary to have a good understanding of
the field of management.
DEFINITION OF TERMS
Management
There is no universally accepted definition of management hence different
authors and practitioners have put forward different definitions. Many of the
definitions emphasise one or a few aspects of the discipline. Some of the
definitions, which have received wide acceptance in academic and professional
circles, include the following.
Management is a branch of social sciences that deals with establishing and
achieving various objectives (Kaila, 2003).
Peter Drucker (1955), a widely read writer on general management says that
“management is the organ of society specifically charged with making resources
productive”.
Management is the planning, organizing, leading, and controlling of human and
other resources to achieve organizational goals effectively and efficiently. An
organization’s resources include assets such as people and their skills and
knowledge; machinery, raw materials, computers and information technology,
and financial capital (Jones & George, 2003).
Harrold Koontz & O’Donnel (1984) define management as the creation and
maintenance of an internal environment in an enterprise where individuals,
working together in groups, can perform efficiently and effectively towards the
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attainment of group goals. The five essential managerial functions are planning,
organizing, staffing, directing and leading and controlling.
The existence of so many different definitions of management implies that the
field of management is too pervasive for any one definition to suffice.
Any definition of management must include three common factors namely goals,
limited resources, and people
Thus management is the process of achieving organisational goals using limited
resources and by working with and through people.
Human Resources Management
According to Mathis and Jackson (2000) Human Resources Management deals
with the design of formal systems in an organization to ensure the effective and
efficient use of human talent to accomplish organizational goals. In an
organization, the management of human resources means that they must be
recruited, compensated, trained, and developed.
Flippo B.E. (1976) uses the term Human Resources Management synonymously
with Personnel Management. He defines Personnel management as the planning,
organising, directing, and controlling of the procurement, development,
compensation, integration, maintenance, and separation of human resources to
the end that individual, organisational, and societal objectives are accomplished.
This definition emphasises the functions performed by human resource
managers.
In less academic terms, one would define human resource management as an
activity that deals with getting people, preparing them, activating them, and
keeping them. The weakness of this definition is that it does not realise that the
same people who get into an organisation will need to leave it in one way or
another.
Human resource management is concerned with the "people" dimension of
management. Indeed every organisation is made up of people, and therefore
acquiring their services, developing their skills, motivating them to high levels of
performance, and ensuring that they continue to maintain their commitment to the
organisation are essential elements for achieving organisational objectives.
Every manager or team leader is concerned with the way in which people are
employed as well as with what they need to be doing, and how well.
The success of any organisation- whether it is the government or it is involved in
business, education, health, recreation or social action- depends heavily on its
ability to attract and keep good people.
Organisations that are able to acquire, develop, stimulate, and keep outstanding
workers will be both effective (able to achieve their goals) and efficient (using
the least amount of resources necessary). Those organisations that are ineffective
or inefficient risk the hazards of either stagnating or going out of business.
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FUNCTIONS OF HUMAN RESOURCES MANAGERS
Human Resources Managers perform two (2) major functions, namely:
1. General Management functions which include Planning, Organising, Directing
and Controlling
2. Specific Human Resource Management functions. These are Procurement,
Development, Compensation, Integration, Maintenance, and Separation
1. GENERAL MANAGEMENT FUNCTIONS
A) PLANNING Planning is the process of formulating future courses of action. It is like taking a
walk into the future and deciding;
what will be done;
when it will done;
who will do it;
how it will be done;
How to measure the results;
An illustration is as below: What will be done: Introduction of a new product
When this will be done: By December 2007
Who will do it: Research & Development Department
How: Through continuous Research
How to measure Results: By evaluating whether the product will have been
introduced by December 2007
The need for planning derives from the fact that organisations are goal-seeking
entities; planning is a tool for identifying these goals and finding ways to achieve
them.
Planning is important because it provides employees with a sense of direction,
shows the kinds of tasks they will be performing and explains how their activities
are related to the overall goals of the organisation. Without this information,
organisational members would not know how to utilise their time and energies
effectively.
Managers develop short term, medium term, and long term plans at the various
levels of management.
Planning is also a pre-requisite for the other managerial functions of organising,
directing and controlling. It allows managers to co-ordinate the activities of their
employees towards pre- determined goals. It also becomes the basis for
monitoring and evaluating actual performance.
Effective managers spend a substantial portion of their time planning. The
process of establishing goals for the entire organisation should include the active
and enlightened participation of the human resource manager with his/her
expertise in the area of human resources. The human resource manager should
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translate the strategic plans of the organisation into the number of people needed
to accomplish them. Whenever functional heads participate in the strategic
planning process, they should translate the plans in relation to the requirements
from their departments. This applies to the heads of finance, marketing,
engineering and so on.
B) ORGANISING Once workable plans are developed, managers should organise their people and
other resources in some logical manner so as to carry out the plans.
Organising involves:-
Acquiring the necessary resources
Dividing organisational activities into groups /departments such as the
Purchasing department, Production department, Marketing department,
Accounting department, Human Resource department, and General
administration department among others.
Assigning people to various groups
Defining working relationship among various groups. Organisational activities
are often divided into various groups/ departments and people with
specialised knowledge and interest are assigned these tasks. Formal and
informal relationships among group members are specified to facilitate
effective communication and working relationships.
C) DIRECTING Most managers spent a great deal of their time directing the efforts of
organisational members.
These functions includes:-
Motivation
Leadership
Communication
Co-ordination
MOTIVATION Motivating employees is an important task for managers because they rely on
employees to get the work done. People join and work in organisations to satisfy
their needs; organisations lead people to carry out the activities needed to
achieve their goals. Motivation involves finding the incentives that satisfy the
needs of employees. Different people are motivated by different things such as:
Money
Job security
Good working conditions
Appropriate supervision
Friendly co-workers
Recognition
An interesting job
Growth opportunities
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LEADERSHIP Leadership means the ability to influence the behaviour of other people in a
certain direction. Managers need this ability to get employees to accomplish
organisational tasks. Often managers acquire leadership skills through expert
knowledge, respect, and personal charisma or by other means.
COMMUNICATION Communication is the transmission of information from and to all levels of the
organisation. Since communication is so purposive, managers should learn to
communicate effectively.
CO-ORDINATION Co-ordination is the process by which the activities of the organisational
members are integrated to achieve organisational goals most sufficiently. Since
most organisational activities are divided and performed by different individuals
or groups, they need to be co-ordinated by managers at different levels to
achieve the goals in a concerted manner.
D) CONTROL FUNCTION This is the final stage of the managerial process and involves ensuring
organisational activities are carried out as planned.
There are 4 steps in controlling namely: -
1) Establishing performance goals or standards e.g. profits of $20m to be
achieved in the year 2007
2) Measuring Actual performance e.g. profits achieved for the year 2007 are
$15m
3) Comparing actual performance with goals or standards e.g.
Planned performance $ 20m
Actual performance $ 15m
Variance/ Deviation $ 5m
4. Rewarding excellent performance or taking corrective action such as lowering
the profit expectations and training the workers.
Performance standards are the yardsticks (measuring units) against which actual
performance is measured. To be effective the standards must be attainable and
specific.
Actual performance is then compared to standards to see if the work has been
done successfully.
Human resource auditing is an evaluation of the Human Resource activities to find
out if they are in line with the objectives of the organisation.
2. SPECIFIC HUMAN RESOURCE MANAGEMENT FUNCTIONS
i. PROCUREMENT/ACQUISITION
This is concerned with obtaining the proper quality and quantity of employees
that are necessary to accomplish an organisation's goals. Acquisition deals
specifically with subjects such as strategic human resource planning,
determining sources of recruitment, communicating with potential candidates,
inviting and receiving job applications, reviewing application forms, short-listing
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the candidates for interviews, selection through interviews, conducting pre -
employment tests, checking referees, giving job offers or letters of regret, and
inducting and placing selected employees. In order to determine the human
resource requirements of an organisation, it is necessary to establish the duties to
be done so as to meet organisational objectives. The establishment of duties
becomes a basis for the recruitment.
Procurement must not violate laws such as Affirmative Action and Equal
Employment Opportunity Act that seek to offer equal employment chances to all
people irrespective of gender, race, tribe, and so on.
ii. DEVELOPMENT
Many managers have realised that employees do not learn new skills through
trial and error or simply by watching other employees. Thus the training of
employees is extremely important to every pragmatic organisation.
Training has to do with the increase of skills and it is necessary for proper job
performance. The importance of this activity will continue to grow because of
changes in technology, the realignment of jobs, and the increasing complexity of
the managerial tasks.
While training emphasises skill development and the changing of attitudes
among workers, development is directed to the managers of the organisation.
Development concerns itself primarily with knowledge acquisition and the
enhancement of executives’ conceptual, diagnostic and human abilities.
Career development, which is the continual effort to match long-term individual
and organisational needs, is also an important area of training and development.
iii. COMPENSATION
Employees exchange their work for rewards and money is probably the most
important reward. Compensation administration is concerned with the adequate
and equitable remuneration of employees for their contributions to organisational
objectives. It is one of the most important functions of the human resource
manager.
iv. INTEGRATION
The need for integration arises from the realisation that employees have many
differences among themselves and which may affect their work performance.
Conflicts often arise between employees, work groups, employees and the
management, or even between the organisation and other organisations.
The essence of integration is to attempt to effect a reasonable reconciliation of the
conflicting interests. In this case, the human resource manger would deal with
issues such grievances, disciplinary action, and labour unions.
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v. MAINTENANCE
The aim of maintenance is to ensure that employees are happy with their jobs, the
organisation, relationships with colleagues and so on. Through maintenance one
will be able to perpetuate a willing and able workforce. The maintenance of
willingness is heavily affected by communication with employees, good physical
condition of the employees, and health and safety of the workers.
vi. SEPARATION
Separation involves returning the employees to the society from which they came
and ensuring that the returned employees are in as good shape as possible.
Separation may take the form of retirement, lay offs, outplacement, and
discharge. In some cases employees die while they are still in active
employment. The organisation, led by social responsibility principles, should
assist the family of the affected person in a variety of ways.
The table below summarises the major functions involved in human resources
management.
Table 1: Major functions of HRM
Major function Activities involved HR planning & analysis HR planning; job analysis; HR
Information and assessment systems
Equal Employment Opportunity Compliance; Diversity; Affirmative
Action.
Staffing Recruiting, selection, induction,
promotions, transfers.
HR Development Employee training, management
development; employee assistance
programs, career planning;
performance management,
counselling, diversity programs.
Compensation and benefits Wages/ salary administration;
incentives; benefits.
Health, safety, and security Health and wellness; safety; security,
handling terminal sickness like AIDS
and Cancer.
Employee and labour/management
relations
HR policies; employee rights and
privacy; union-management relations.
Performance Management Performance contracts, balanced
score card and performance
appraisal.
Directing Motivation, leadership and
communication.
Separation Voluntary retirement, retrenchment,
redundancy, summary dismissal,
handling death of employees
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The purpose of the activities outlined above, both managerial and operative is to
assist in the accomplishment of basic objectives. Consequently, the starting point
of personnel management, as of all management, must be a specification of those
objectives and a determination of the sub-objectives of the personnel function.
IMPORTANCE OF PERSONNEL/ HUMAN RESOURCE MANAGEMENT TO
ALL MANAGERS
It helps managers not to commit the following personnel mistakes i.e.
Hiring the wrong person for the job
The organization having a high labour turnover
People not doing their best
Managers wasting time with useless interviews
Having the company taken to court because of discriminatory actions
Having some of the employees think their salaries are unfair and
inequitable relative to others in the organisation
The lack of training that may undermine a department’s effectiveness
Committing any unfair labour practices
Treating employees unfairly because of their cultural orientations
THE SHIFT FROM PERSONNEL TO HUMAN RESOURCE MANAGEMENT
Personnel departments were once called "Health and Happiness” departments.
The people assigned to deal with personnel issues were often individuals who
were past their prime. The personnel department was seen as a place where less-
productive employees could be placed with minimal damage to the organisations
on going operations. Individuals in the personnel department were perceived as
those responsible for planning company picnics, vacation schedules, and
retirement parties. Personnel, as an activity, were seen as a necessary, but
unimportant part of the organisation.
As the field of management began to mature, more emphasis was being placed
on the workers. Various studies have revealed that by recognising workers for
the work they had done could influence their productivity (see Hawthorne studies
- in the Human Relations movement).
Due to these changes, the personnel department could not be treated as a by the
way on the road to success. Organisations had to hire the best-qualified
candidate without regard to race, religion, colour, sex etc.
Further, workers were becoming more demanding in terms of what they wanted
from a job; and society by means of law and legislation was placing new demands
on employers.
A number of events mandated changes in personnel practices e.g. the rise of a
modern labour union, the increasing educational level of societal members, the
increasing size and complexity of the organisation and its technology, and the
insistent and sometimes violent demands of less privileged segments of our
society.
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The figure below shows how the role of the personnel manager has changed over
the years.
Fig. 1: The Changing Roles in Personnel Management (1930-1996)
Time has moved the Personnel Manager from a Welfare Officer in the 1930s to a
Visionary/ Corporate Philosopher in the 1990s.
In the years of expanding economic activity in the 1950s and 1960s, the emphasis
moved away from welfare to recruitment and human resource planning since all
organisations faced intense competition for labour.
In the 1960s and 1970s the problems of increasing trade union power, backed by
a flood of labour legislation called for industrial relations and legal skills. It was a
time for personnel managers to show their loyalty to the enterprise by fighting off
what employers regarded as excessive claims for improved terms and conditions
of employment.
A weakening of the general economic conditions and unemployment in labour
markets all over the world marked the 1980s. This forced business markets to
carry out intensive cost cutting measures, especially labour. Moreover,
unemployment laws began to reflect the new economic priorities, consequently
the protective framework of legislation for trade unions and their members was
Welfare Officer
(1930’s)
Recruitment Specialist
(1950’s)
Industrial Relations
Negotiator (1970’s)
Human Resources
Supplier (1980’s)
Visionary/ Corporate
Philosopher (1990’s)
All round business
manager (2000’s)
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drastically reduced, and thus freeing business organisation’s to make substantial
changes to their workforce in the light of business priorities.
In the 1990's the Personnel Manager assumed both the functions of supplying
personnel services and being a Visionary/ Corporate Philosopher for the
organisation.
In the new millennium the human resource manager is expected to be an all
round manager able to handle all kinds of business problems.
DIFFERENCES BETWEEN HUMAN RESOURCE MANAGEMENT AND
PERSONNEL MANAGEMENT
Personnel management can be defined as activities “directed at the
organisation’s employees and finding and training them, arranging for them to be
paid, explaining managements expectations, justifying managements actions,
satisfying their needs, dealing with their problems, and seeking to modify
managements actions that could produce an unfavourable response” (Storey,
1992:6).
The above definition shows that personnel management occupies a middle
position between management and employees. Personnel management places a
high priority on employees’ attitudes, interests, and responses (Guest, 1987). In
some cases, personnel management identifies more with the employees than with
the management.
Human resource management, on the other hand, is directed not just to the needs
of the employees but emphasis is placed on the planning, monitoring and
commitment than problem solving and mediation (Torrington 1995). Human
Resource Management is concerned with the entire life of the employees at work;
from entry to exit. It enables goals and values of the individual and those of the
organization to be integrated and achieved (Handy 1985). Personnel
Management has thus evolved to become human resource management.
Armstrong (1998) argues that Human Resource Management adopts a more
strategic and far-reaching approach as opposed to the Personnel Management,
which is characterised by a less dynamic and Short- term view of the organisation
and its needs.
The major areas of differences are as below:
Personnel Management is about administration and procedures while
Human Resource Management is about a strategic approach to the
acquisition, motivation, and management of an organisation’s human
resources.
Human resource management adopts the executive roles and transfers the
personnel management aspects to the level of line management. Human
resource managers often adopt advisory roles as opposed to purely
functional and implementation roles.
Personnel management is pre-occupied with the day to day running of the
organisation while human resource management adopts an advisory role
and attempts to ensure that the organisation’s activities are closely linked
with its corporate strategy and that they fit into the culture of the
organisation (Handy, 1985)
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Guest (1987) in his article “Relations” drew a model illustrating the “stereotypes
of Personnel Management and Human resource management” To him, human
resource management adopts an open system and long-term approach unlike
Personnel Management.
STEREOTYPES OF PERSONNEL MANAGEMENT AND HRM
PERSONNEL
MANAGEMENT
HUMAN RESOURCE
MANAGEMENT
Time & planning
perspective
Short-term, reactive, ad
hoc, marginal.
Long term, proactive,
strategic, integrated.
Psychological contract compliance Commitment
Control systems External controls Self control
Employee-relations
perspectives
Pluralists, collective, low
trust
Unitarist, individual,
high trust
Preferred
structures/systems
Bureaucratic,
mechanistic, centralised,
formal defined roles
Organic, devolved,
flexible roles.
Roles
Evaluation criteria
Specialist/ professional
Cost minimization
Largely integrated into
line management
Maximum utilization
(human asset
accounting).
CH. 2: CHALLENGES OF MODERN HUMAN
RESOURCE MANAGEMENT
Chapter objectives.
After reading this chapter, it is expected that the reader will be able to:
Explain the challenges faced by a contemporary human resource
manager.
Discuss the appropriate responses to each challenge.
Appreciate the relevance of job redesign especially the concept of
flexitimes.
Introduction. Many problems are caused by constant changes that occur both within and
without the firm. Among the many major changes that are occurring in the field of
human resource management include the following:
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1. Changing Mix of the Workforce
i. Increased number of minority members entering occupations requiring
greater skills.
ii. Increasing levels of formal education for the entire workforce
iii. More female employees
iv. More married female employees
v. More working mothers
vi. Steadily increasing majority of white-collar employees in place of the blue
collar ones.
vii. Culturally diverse workforce
Prohibition of discrimination requirements for positive action to redress
imbalances in work force mix have led to greater numbers of minority personnel
being hired for all types of jobs. In the USA the proportion of blacks, for example,
has increased significantly in professional, technical, managerial, clerical, sales,
and artisan-type jobs. Steady increases in the level of formal education would
seem to bode well-continued change. In Kenya, minorities include the Ogiek,
Teso, Pokot, Marakwet, and Tugen.
There has been a long-term trend towards mass education in many countries.
Increased educational levels create human capital that adds value to an
organization. This higher educational attainment has contributed to better jobs
and higher income for the people involved. This also calls for redesigning and
reorganising, jobs to effect a match with the better-qualified personnel of
frustration, absenteeism, grievances, and turnover.
Laws, as well as activist groups, have contributed to greater numbers of female
employees entering the workforce. Several forces have operated to increase both
the number and percentage of women in the labour force in recent years. These
forces include the steady decline in the fertility rate since the late 1950's, fewer
children being born or expected by women, increasing availability of household
labour saving appliances, equal opportunity efforts being made by governments
in different parts of the world, and an increase in women's liberation movements.
Further distinctions between men's occupations and women's occupations are
disappearing. Women now hold jobs such as jockeys, telephone line women,
sailors on ships engineers, executives, and university professors.
Also, of significance to the manager is that increasing proportions of employees
are married and/or have children under the age of 6 years. This makes it difficult
for them to become regular members of an organisation, and human resource
managers should seriously consider practices such as flexible working hours,
sharing of one job by two or more workers, and providing child care during
working hours. Chemilil Sugar Company has been in the forefront in the
provision of childcare services.
There has been a trend towards the professional jobs as opposed to the manual
jobs requiring fewer skills. Professionals are typically less inclined to join labour
unions, but they have greater expectations in terms of individual treatment by
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management. Moreover, the performance of jobs tends to be more difficult to
evaluate objectively.
More and more tasks formerly performed by unskilled labourers have been
taken over by machines. One implication of this fact is that high schools dropouts
will find it more difficult to get good jobs.
2. Changing Values of the Workforce
The changing mix of the workforce inevitably leads to introduction of new values
to organisations. In the past most workers had a set of values generally
characterised by the term "work ethic". Work was regarded as having a spiritual
meaning, and it was emphasized by such behavioural norms as punctuality,
honest, diligence, and frugality. Employees took their jobs very seriously.
Contemporary employees have less of the work ethic mentality in them. Family
activities, leisure, avocations, and assignments in government, churches, and
schools are all equally viable means through which a person can find meaning
and become self-actualised. Yet in some countries the population is aging and
hence there are fewer workers than the demand for them. Consequently
organisations have had to introduce a number of changes in their human resource
so as to attract the scarce resources. For example, attempts have been made to
redesign jobs to make them more challenging so as to meet the needs of the
human ego.
Concerning pay, a few firms have moved to pay the employee for skills
possessed rather than for skills demanded by the job. As far as fringe benefits are
concerned, a cafeteria arrangement has been proposed where the employee can
periodically choose what particular benefits he/she desires while remaining
within an overall schedule are being reorganised
Perhaps one of the most relevant work redesigning strategy is the use of flexible
working arrangements. These include the flexible working day (flexitime),
compressed workweek and the flexible working year (flexi year).
Flexitime is a program that allows flexible starting and quitting times for the
employee. An illustration is:
1. 7.00 a.m. - 9.00 a.m. Flexible band for reporting
2. 9.00 a.m. - 11.30 a.m. Core time - all employees must be
present
3. 11.30 a.m. - 1.00 p.m. Flexible time for taking a 30 min lunch
4. 1.00 p.m. - 4.00 p.m. Core time where all employees must be
present
5. 4.00 p.m. - 6.00 p.m. Flexitime for quitting depending on the
arrival time.
Ideally everyone is expected to work a fixed daily schedule known as the "core
time". This period, centred in the regular workday, typically spans four to six
hours. A "flexible band" of up to several hours replaces the specific starting and
quitting times. Workers can elect to start and finish work within the flexible band
intervals.
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Explanations for this include:
Flexitimes often lead to productivity improvements because of the following
reasons.
Better fit of work time to the employees "body clock"
Improved handling of fluctuating workloads
Increased customer service because the establishment is open for more
hours in any one working day.
Less "killing time" until quitting time because of reluctance to begin a new
task
Less labour turnover
Employees are treated substantially in the same way as managers and
professional personnel. The result is an increased ability to schedule
leisure activities, family responsibilities and personal chores.
Less time in commuting to and from work and reduction of traffic
congestion and air pollution. Moreover, it becomes easier to access retail
and services outlets during their free times.
Improved employee morale, elimination of tardiness, and reduced
absenteeism and sick leave.
Improved public relations as an edge in recruiting employees.
Disadvantages of Flexitime
Some of the limitations of flexitime working arrangements include the following.
Utility costs are increased since the plant is open for longer periods of time
Not all the necessary employees may be present when a particular
problem arises, thereby forcing the problem to be postponed until the
core period when all the employees are present.
There are difficulties in recording hours actually worked, and a lot of
paperwork may be involved.
There may also be conflicts with certain laws that require the payment of
overtime for hours worked in excess of eight per day or work done before
eight o’clock in the morning or past five o’clock in the evenings.
Supervision may become a problem since a single supervisor cannot be
present for the full eleven or twelve hours of the authorised day
There may be some confusion for customers and suppliers who are not
familiar with the varying attendance of personnel under flexitime
arrangements
Indeed, some employees put in extra hours under flexitime systems because they
feel more freedom and interest in their work. Hours worked tend to be more
productive because employees are likely to leave at a 'stopping point' instead of
slowing down towards the end of the work day.
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Shorter workweeks/compressed workweeks are schedules with fewer than the
traditional five workdays a week for forty hours, or 5/40. The hours are increased
so that the hours worked per week still total forty.
There are several ways to compress the workweek and day. These include
working fewer hours in a regular five day week, three-day, 12 hour shift; and four
day, 40 hour week. The 4/40-week permits non-work time scheduling, so that
people with a strong leisure orientation can be expected to react positively to it.
It leads to an increase in job satisfaction, morale and productivity, and reduced
turn over and absenteeism. Nevertheless, the traditional 5/40 is more popular
among organizations.
3. Changing Expectations of Citizen-Employees
Modern employees have greater expectations from their employers. Through
working, they expect to buy good homes, cars, food, and clothing. They also
expect to make enough money to educate their children in excellent schools and
to buy luxurious goods.
Employees are also resisting the traditional master servant relationships that
simplified the relationship between the employer and the employees. Instead,
employees want to contribute in decisions that affect them. Some employees are
joining labour unions in an effort to pressurize management for material things
such as higher wages and more fringe benefits, and also to demand for fair
treatment, freedom from discrimination, and a say in matters affecting them.
Managers also forced to involve employees in decision-making.
Issues such as freedom of speech and the right to privacy are also gaining
prominence. Employees often question some of the information they are required
to provide in order to obtain and hold jobs. To them some questions such as those
relating to pregnancy, drinking habits, kinds of friends, type of neighbourhood in
which one lives, records of arrests, ability to pay bills, and whether the job
applicant has ever received psychiatric counselling are considered an invasion of
privacy,.
4. Changing Levels of Productivity
In many countries, the human resource manager is faced with the acute problem
of declining productivity. The reasons for this decline in productivity include
various government regulations which have added to the cost of doing business
without enhancing productivity in the short run, such as laws relating to
environmental protection, health and safety, affirmative action and so on.
Affirmative action laws have also led to more females and minorities being
employed. Initially such employees may be less productive.
The short-term orientation of many business managers is also to blame for the
reduced productivity. The managers may act from the pressures of financial
institutions and other stakeholders to present profits over a very short time
period. Consequently, they may ignore the much needed long term investment
which leads to profits over the longer term.
20
There is also a trend towards service businesses. Productivity gains are harder to
achieve in service businesses compared to goods manufacturing businesses. And
when the relationship between the workers and the management is poor, it is
even more difficult to improve productivity. This is especially the case where the
employees perceive high job insecurity, narrow and meaningless jobs and
autocratic managers who deny employees the opportunity to participate in
decisions that affect their work.
5. Changing Demands of Government
Human resource managers must also adhere to the various government laws that
relate to employees. The laws govern activities related to the procurement,
development, compensation, integration, maintenance, and separation of the
workers. An example is the minimum wages Act that specifies the minimum
wages an employee can be paid.
In many situations, organizations may need the services of a lawyer to interpret
the labour laws.
6. Epidemics- modern employees are exposed to a wide range of epidemics
which include HIV/ AIDS, Ebola, Asian Bird Fu and Tsars. These epidemics often
affect many people and results to numerous losses of life. The end result is fewer
workers and the loss of valuable skills which take a long time period to develop.
7. Regional Conflicts- these are also a major challenge especially in third
world countries. Political disagreements often result to conflicts, loss of life, and
the displacement of numerous others. Somalia, Southern Sudan, and even Kenya
have experienced these conflicts and their effects have been very painful.
8. Natural Disasters- these include floods, droughts, earthquakes, and
mudslides among others. Examples are El-Nino, La-Nina, Tsunami, and Katrina.
These natural disasters often lead to massive loss of lives and property.
9. Leaner Workforce- the human resource manager is faced with the
challenge of having to maintain a leaner workforce in an effort to cut costs. The
result is an overburdened workforce which is prone to stress and burnout.
10. Technological Changes- rapid changes in technology are forcing
organizations to spend more on acquiring the technologies and on training the
workers on the use of these technologies.
11. Discrimination – it is difficult to get rid of all forms of discrimination in
the workplace. The human resource manager often has an uphill task trying to
eliminate discrimination based on race, gender, religion, and so on.
21
CH. 3: CREATION AND MANAGEMENT OF
THE HUMAN RESOURCE DEPARTMENT Chapter objectives.
This chapter introduces learners to:
The differences between staff and line functions.
The bases of departmentalization for HR departments.
Introduction: In many small organisations, the human resource function may be handled by the
managing director or other functional specialists. However, as the organisation
grows larger and larger, the human resource needs increase and there may be
need for a separate department to handle personnel issues.
The human resource department is expected to assist the organization to achieve
its objectives by taking initiatives and providing guidance and support on all
matters relating to the employees. This implies that the department takes an
active role in managing and facilitating change, prepares its budget, out sources
those services that it can, and employees people to do the work required by the
organization.
The effective performance of all these functions is only possible where the HR
department is properly constituted.
BASES OF DEPARTMENTALIZATION
HR departments are considered to perform a staff function. Staff functions provide
advisory, control, or support services to the line functions. The human resource
specialists are expected to provide their services to internal customers such as
top management, line managers, team leaders and employees. They also provide
guidance and counselling to these groups of customers. And since they are
business experts, they assist the functional managers in making relevant long run
and short run business decisions.
Effective human resource specialists should have personal drive and
effectiveness, people management and leadership skills, professional
competence, ability to add value through people, continuously learning, having a
customer focus, influencing and interpersonal skills, strategic capability, and
resourcefulness as well as use of initiative in dealing with issues in the
organization ( Brockbank et al, 1999).
Line functions are those whose operations are concerned with the production of
goods and services. The main line functions are Research and Development,
Production, Marketing and Accounting.
In situations where the organisation desires a human resource department, then
managers should choose the most optimal method of creating the department.
There are several basis of departmentalisation, which include the ones discussed
below.
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1. Functional Base
Perhaps this is the most common method of creating human resource
departments. It is based on the functions performed by the human resource
department. In many organisations, the basic grouping of functions revolve
around procurement (employment), development (training), compensation
(wage and salary administration), integration (labour relations), maintenance
(health, safety and welfare services), and separation (employee services related
to separation whether it is through retirement, death etc.).
The exact breakdown would vary from enterprise to enterprise and it may be
affected by variables as the size of the organization, abilities of the employees in
the department, and the top management philosophy regarding the role of the
unit.
The structure of the unit would resemble the figure below:
Fig. : HR department- functional structure.
Fig. The functional basis of creating the HR department.
2. Clientele/ Customer Base Organisations serve different types of both internal and external customers. Each
set of customers has its unique needs.
The human resource department should be structured in such a way that the
different clients are addressed. The main internal clients include scientific and
technical personnel, workers who are new to industry, the hard cores who had
been unemployed for long periods, managers, women, and labour organised into
unions.
Thus instead of a "total market" approach to all the employees in organisation,
market or personnel segmentation would be more likely to lead to differentiation
Human Resource Director
Employment
Services officer
Training &development services
Wage and
salary administ
ration services
Labour Relations
Health and
Safety services
Employee Separation
Services
23
in the treatment of personnel. As a result, there would be higher levels of
satisfaction in dealing with the employees.
Fig. : Human resource department- customer basis of departmentalization.
3. Service Base This is borrowed from Herzberg’s two factor theory of motivation. Herzberg
proposed the 2-factor theory of motivation where we have motivators and
hygiene factors.
According to Herzberg, hygiene factors are those factors that, if present, don't
cause motivation; instead they bring motivation to level zero. In situations
whereby those factors are absent, they cause dissatisfaction leading to de-
motivation. Examples of these factors are in the areas of:
Physical working conditions- if the working conditions are good, motivation
goes to level zero.
Job security- insecurity in the workplace is a source of dissatisfaction.
Management styles- dictatorial styles of management may de-motivate
workers.
Salary- fair salaries do not necessarily motivate workers; unfair wages and
salaries are a source of de-motivation.
Interpersonal relations- poor interpersonal relations dissatisfies employees.
Herzberg also proposed the concept of motivators. These are the factors that, if
present, bring about positive motivation. He proposed the following to be the
main motivators for employees:
A work which allows a person to make some concrete achievement
Recognition of the achievement
Responsibility exercised by the person
Opportunities for job growth
The interest value of the work itself
Human Resource
Director
Scientific & Technical Personnel
Integration of workers
Culturally disadvanta
ged
Management
development &
Compensation
Labour Relations Women
workers
24
If one considers the reasoning advanced by Fredrick Herzberg, then the human
resource department can be structured in such a way as to take care of both the
hygiene and motivation factors. This can be done by:
i. Preventing dissatisfaction through hygienic maintenance
ii. Promoting satisfaction through motivators
The functional breakdown of the motivator division would include:
a. An educational function to convince all managers that satisfaction comes
basically from the job content and not the surrounding environment.
b. A job design function to enhance interest and pride in work
c. A remedial function involving training and education to overcome
technological obsolescence and poor performance of specific individuals and
groups.
In most instances, the particular personnel department organisation that is
adopted is a combination of bases, rather than any single one.
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CH.4: HUMAN RESOURCE POLICIES
Chapter objectives
This chapter entails a detailed explanation of:
What human resource policies are;
Why organizations adopt human resource policies;
The importance of writing down policies;
The procedure for formulating policies;
The process of communicating policies;
The critical human resource policy areas.
Introduction.
A policy is a plan of action. It is a statement of intention committing management
to a general course of action.
A policy statement is specific. It commits management to a rather definite course
of action. An example of a policy is stated below.
"Our policy is to institute every practical method for engineering safety into our
processes and equipment, to provide protective clothing where necessary, to train
employees in safe operating procedures, and to vigorously enforce established
safety rules. Our policy is to provide a healthful plant by giving adequate attention
to cleanliness, temperature, ventilation, light, and sanitation".
A policy is a statement of intended conduct, or a rule of behaviour, which is
intended to apply across the organisation. It is an expression of the organisation’s
values and beliefs concerning all the major functions of the enterprise. Ideally
policies tell us how the organisation intends to go about achieving its objectives.
A policy does not spell out the detailed procedures by which it is to be
implemented. That is the role of a procedure. A procedure is really a method for
carrying out a policy.
A policy should be stated in terms broad enough for it to be applicable to varying
situations. Lower level managers who apply policy must be allowed some
discretion in carrying out the policy. The circumstances in one department may
differ from those in another hence a rigid, excessively detailed policy statement
might cause injustice if supervisors were not granted some latitude or freedom of
application.
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Why should organizations adopt definite Policies?
It is important to understand why an organisation should have clearly established
policies. Some of the reasons include the following:
1. The work involved in formulating human resource policies requires that the
managers give deep thought to the basic needs of both the organisation and
the employees. Management must examine its basic convictions as well as
give full consideration to prevailing practice in other organisations.
2. Established policies assure consistent treatment of all personnel throughout
the organisation. Favouritism and discrimination are minimised.
3. Continuity of action is assured even though top management personnel
change. The tenure of office of any manager is finite but the organisation
continues. Policies promote stability.
4. Policies serve as a standard of performance. Actual results can be compared
with policy to determine how well the members of the organisation are living
up to professed intentions.
5. Sound policies help to build employee enthusiasm and loyalty. This is
especially true where the policies reflect established principles of fair play
and justice and where they help people grow within the organisation.
6. Policies protect the employees from unfair practices in the organisation and
vice versa.
POLICIES SHOULD BE IN WRITING
Written policies let everyone know just what kind of treatment they can expect to
receive from management. It lets them to know where they stand in relation to
any circumstance that occurs. Only when policies are reduced to writing can they
be communicated to all employees.
In large organisations containing many dispersed plants, written policies are
almost a necessity. They ensure reasonably consistent treatment throughout the
company on matters such as pay, promotion, transfer, lay off, pension rights,
insurance benefits, training opportunities, and grievance handling.
FORMULATING HUMAN RESOURCE POLICIES
Policies are not created in a vacuum. There are five principal sources for
determining the content and meaning of policies. These are:
1. Past practice in the organisation
2. Prevailing practice among other companies in the community and throughout
the nation in the same industry
3. The attitudes and philosophy of middle and lower management
4. The attitudes and philosophy of the board of directors and top management
5. The knowledge and experience gained form handling countless personnel
problems on a day-to-day basis.
6. The law of the country is a major consideration when formulating policies.
The Human resource (or industrial relations) director will do the actual work of
formulating the written expressions of company personnel policies. They will
study existing documents, survey industry and community practices, and
interview other executives within the organisation to collect appropriate
information. The president and the board of directors make the actual and final
decision on the substantive content of the policies.
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The following steps should be taken when formulating or revising personnel
polices. It is very important to gain an understanding of the corporate culture of
the organisation and how this affects work patterns. Nevertheless the steps below
can be an appropriate guide for establishing policies.
1. Analyse existing policies – both written and unwritten
2. Analyse external influences e.g. employment laws, health and safety laws etc.
3. Assess any areas where new policies are needed or existing policies are
inadequate
4. Check with managers, preferably starting from the top, on their views about
personnel policies and where they think could be improved
5. Seek the views of employees about personnel policies, especially the extent
to which they are inherently fair and equitable and are implemented fairly and
consistently. Consider doing this through an attitude survey.
6. Seek the views of union representatives
7. Analyse the information obtained in the first seven steps and prepare draft
policies
8. Consult, discuss, and agree policies with management and union
representatives
9. Communicate the policies with guidance notes on their implementation as
required. Supplement these communications with training
COMMUNICATING POLICIES
Human resource policies must be communicated to everyone within the
organisation. A real education program should be set up to teach all management
personnel how to handle various personnel problems in the light of the newly
created policy.
The most common way of informing non-supervisory employees is by means of
the employee handbook. But to achieve real understanding this should be
followed up with an oral explanation and interpretation generally by first-line
supervision.
CRITICAL POLICY ISSUES
Most of the critical HR management issues are included in 4 broad areas:
1. Employee Influence
With the increasing popularity of reengineering, Total Quality Management,
co-operative labour- management relationships, and other forms of worker
participation, more and more organisations are developing policies that
define the scope and breadth of employee influence in managing the
organisation.
Such policies specify the degree of authority and responsibility that are
delegated to employees and employee groups, and the way in which those
relationships (e.g. Quality circles Vs self managed work groups) may be
institutionalised most effectively.
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2. Personnel Flow
Policies may be set in the areas of selection, promotion, job security, career
development and advancement, fair treatment and terminations.
3. Reward Systems
The objectives of reward systems include the attraction, motivation, and
retention of employees at all organisational levels. The accomplishment of
these objectives forces management to consider a number of critical policy
issues e.g.
a. Should pay incentives reward individual or group behaviour?
b. Should employees share profits or reductions in operating costs?
c. What is the most effective mix of pay and non-pay rewards to motivate
performance?
4. Work Systems
Policy decisions that affect work systems include the kind of manufacturing
and office technologies implemented and the way in which labour is divided.
HUMAN RESOURCE POLICY AREAS
Examples of the specific policy areas, which may be contained in the overall
statement or issued as separate documents are as follows.
a. Employment
b. Equal opportunity
c. Managing diversity
d. Reward
e. Development and training
f. Employee involvement
g. Technology
h. Health and safety
i. Sexual harassment
j. Reward
k. Work-life balance
l. Discipline
m. Grievances
OVERALL POLICY
Organizations normally have an overall policy which states what the organization
stands for. This is normally a brief statement just the mission statement. The
overall policy defines how the organisation fulfils its social responsibilities of its
employees and other stakeholders; it sets out its attitudes towards them. This
statement is an expression of the organization’s values or beliefs about how
people should be treated.
The contents of the overall policy vary from firm to firm but the main items
included are: a. Equity – the policy should state that the organization advocates for treating
employees fairly and justly without any discrimination. The organization should
commit itself to protect individuals from any unfair decisions made by their
managers, to provide equal opportunities for employment and promotion and to
operate an equitable payment system.
29
b. Consideration – it is a commitment to ensure individual circumstances are taken
into account when making decisions which affect the employees.
c. Quality of Working Life – it commits the organization to consciously and
continually improve the quality of working life as a means of increasing
motivation and improving results. Employees will also be expected to fulfil their
personal obligations even when they are working for the organization.
d. Working Conditions – the organization may state that it will endeavour to
provide healthy, safe, and pleasant working conditions.
EMPLOYMENT POLICIES
Policies are normally laid out in all areas of the organization. The human resource
department should have policies relating to the following areas of its operations.
1. Human Resource Planning – this is a commitment by the company to
planning ahead in order to maximise the opportunities for employees to
develop their careers within the organisation and to minimise the possibility of
compulsory redundancy.
2. Quality of Employees - an organisation may deliberately set out in its policy
statement that, as a company dedicated to the pursuit of excellence and
professionalism, it believes in recruiting people who have the ability or
potential to meet the high standards of performance that will be expected of
them. The policy here can be:
“The company will conform to the spirit as well as to the letter of the law in
employment matters”
3. Promotion - The policy should state the company's wish to promote from
within whenever this is appropriate as a means of satisfying its requirements
for high quality staff. The policy should, however, recognise that there will be
occasions when the organisation’s present and future needs can only be met
by recruitment from outside. A firm can have a policy such as:
“All vacancies will be first advertised within the organisation before being made
public”
4. Equal Opportunity - A reference should be made in the general employment
policy statement to the effect that the firm is an equal opportunity company.
The Equal Employment Opportunity policy should spell out the company's
determination to give equal opportunities to all, irrespective of sex, race,
creed, disability, age, or marital status. It could also state that the company
would use its best endeavours to provide equal opportunities to disabled
people. in this regard a policy can read like:
“All posts will be filled on grounds of merit only, and no one will be
discriminated against in terms of sex, ethnic origin, age or any factor other than
ability to fulfil the job competently”
The policy should also deal with the extent to which the organisation wants to
take affirmative action to redress imbalances between the numbers employed
according to sex or race or to differences.
30
5. Managing Diversity Policy – this is concerned with how the organisation
manages the diverse people it employs. Such a policy would recognize that
there are differences among employees and that these differences, if properly
managed, will enable work to be done more efficiently, and effectively.
Managing diversity policy will acknowledge cultural and individual
differences in the work place, state that the organisation values the different
qualities which people bring to their jobs, emphasise the need to eliminate
bias in all areas related to human resource, and focus attention on individual
differences rather than group differences
6. Ethnic Monitoring – this policy states how the company deals with
monitoring the employment of ethnic minorities.
7. Age and Employment - The policy would define the approach the company
adopts to engage, train and promote all employees especially the older
employees.
8. Redundancy - The redundancy policy, could state the organization will do its
best to avoid declaring employees redundant. However, if redundancy is
unavoidable then it will be done in the best way possible.
9. Discipline - The disciplinary policy should state that employees have the
right to know the rules of the organization and what would happen when a
certain rule is disobeyed. A good example of a policy in this area is:
“Every employee will have the right to fair treatment in matters of discipline”.
10. Grievances - the policy should state how employees can go about solving
their grievances.
11. Sexual harassment - the policy would express the company's strong
disapproval of sexual harassment and the measures taken to eliminate it. These
policies can:
Define sexual harassment
State unequivocally that sexual harassment at work is not tolerated and is
regarded as a matter of gross misconduct
Define the role of managers in preventing harassment, and dealing with
complaints
Provide for counselling services for those concerned about harassment
Set out the procedure for dealing with harassment
11. Smoking - the policy would define no-smoking rules. Smoking policies will
spell out whether or not there is a complete ban on smoking and, if not, the
arrangements for restricting smoking to designated smoking areas
12. Substance Abuse – policies here concern how the company treats employees
with drinking or drug abuse problems.
13. Health and Safety Policy – it is concerned with how the company approaches
the employment of people who have health problems including those who are
HIV positive or actually suffering from AIDS. Such policies cover how the
company intends to provide health and safe places and systems of work
14. Pay Policy - a pay policy could cover matters such as paying market rates;
Paying for performance; Gain sharing - sharing in the gains (added value) or
31
profits of the company; providing an equitable pay system; equal pay for work
of equal value, subject to overriding market considerations. An example of a
policy here would be:
“Pay levels will be maintained so as to compete with the best in the industry”
15. Employee Development Policy - This policy should express the company's
commitment to the continuous development of the skills and abilities of
employees in order to maximise their contribution and give them the
opportunity to enhance their skills, realise their full potential and advance
their careers. A development policy includes:
“Employees will be expected to participate in training and development
activities in order to develop their skills”
16. Involvement and Participation Policy - this policy should spell out the
company's belief in involvement and participation as a means of generating
the commitment of all employees to the success of the enterprise. The policy
could also refer to the basis upon which the company intends to communicate
information to employees. An example of a policy here is:
“No organisational changes will be implemented without thorough consultation
with all those directly affected by the changes”
17. Employee Relations Policy - this policy will state the company's commitment
to allowing employees to represent their interests to management through
trade unions, staff associations or some other form of representative system. It
will also state the terms under which the company works with trade unions.
The policy may emphasise that the organisation perceives Trade Unions as
partners. The policy may read like:
“The firm will always negotiate in good faith with trade union representatives”
18. New Technology Policy - such a statement would refer to consultation
about the introduction of new technology and to the steps that would be
taken by the company to minimise the risks of compulsory redundancy.
The above areas are not conclusive. As the organization and its environment
evolve, then new areas of policy may need to be formulated. For example,
policies may be needed in the areas of e-mails and bullying in the work place.
32
UNIT 2: ACQUISITION OF HUMAN
RESOURCES
Ch.5 FAIR EMPLOYMENT PRACTICES
Chapter objectives.
The objectives of this chapter are to enable the reader to:
Understand the need for fair employment practices;
Examine and understand some of the different forms of discrimination that can occur
in the process of employing and managing workers.
INTRODUCTION. Various components of government have decreed that certain employment
practices must be followed. These cover the areas of discrimination.
Generally speaking, discrimination refers to employment decision making that or
working conditions that are advantageous or disadvantageous to members of one
group compared to members of another group.
Discrimination can take different forms. Disparate Treatment occurs when
persons of one race, sex or ethnic group receive different treatment from persons
of another group who are otherwise similarly situated. Consider the case for
blacks and whites. Disparate effect occurs when any particular practice has an
adverse impact upon a protected group such as women or minorities. Negative
present effects of past discriminatory practices may also be construed to imply
discrimination..
FORMS OF DISCRIMINATION:
1. Minority Races (Ogiek, Tesso, Elgon Maasai, Njemps, Asians)
The Equal Employment Opportunities Act (EEO) requires that employment
records be maintained for so that as many communities as possible are included
in the register of employees. This ensures that minority races are not
discriminated against.
2. Female Employees
Many factors should be considered in relation to the employment of females.
Among the illegalities are the refusal to hire women, but not men, with young
children; refusal to hire married women; refusal to hire a female because she
might become pregnant; discharging an unmarried pregnant female; requiring
pregnant employees to take leave without regard to ability to perform the job;
refusal to hire females because heavy weights must be lifted and taking away
seniority rights after pregnancy leave.
it is also an unfair employment practice to discriminate on the basis of pregnancy,
childbirth, or related medical conditions in hiring, promotion, suspension,
discharge, or any other term of employment. Moreover, pregnant employees
33
should be treated the same as other employees on the basis of their ability or
inability to work.
The Equal Employment Opportunities Act (EEO) Requires That:
a. An employer cannot refuse to hire a pregnant applicant so long as she is able to
perform the major functions of the job.
b. If employers accommodate other temporarily disabled workers, they must make
similar accommodations for pregnant workers, e.g. temporary relief from having
to lift heavy materials.
c. The employer cannot require female employees to take leave arbitrarily at a set
time in their pregnancy. Leave times are to be determined by the ability of the
employee to do the job.
d. Full reinstatement rights must be given to female employees on leave for
pregnancy related reasons, including credit for previous service, seniority and
accrued retirement benefits.
e. Fringe benefits or insurance programs, if such exist, must include coverage for
pregnancy of employees in the same manner as for other employee disability or
sick benefits.
f. Employers providing extended medical insurance benefits to husbands of female
employees must cover equally the medical expenses of male employees,
including pregnancy.
3. Sexual Harassment
Sexual harassment is defined as “unwelcome sexual advances, requests for
sexual favours, and other verbal or physical conduct of a sexual nature". The
protection against sexual harassment extends to both male and female
employees. Sexual harassment is prohibited especially where: a) It is made an employment Condition – when submission to or rejection
of such conduct is used as a basis for employee decisions, such as
promotion, retention, so on.
b) If it creates Job interference – when such a conduct has the effect of
interfering with job performance or creating an intimidating, hostile, or
offensive working environment.
c) Such conduct/ condition creates an employment consequence
4. The Older Employee
The retirement ages vary from country to country. In the case for the Kenyan
public service, most employees are expected to retire after attaining 55 years of
age.
In the USA the law prohibits discrimination on the basis of age for anybody
between 40-70 years except in high risk jobs (police officers, fire fighter) and
high-paid private employees who could retire with very liberal pensions. An
example would be the top CEOs. It is Ronald Reagan, one of USA’s oldest CEOs in
the history of USA who worked hard to see that such a law was passed on a
national basis.
Older employees are often stereotyped/considered to be inflexible, resistant to
change, less creative, and unable to deal with crisis situations. This is only a
34
perception which can end up being the reality. Nevertheless, they are the equals
of the younger in terms of quantity and quality of out put. In addition, they offer
maturity derived from experience; they are less prone to accidents than the
younger employees.
Ideally the older employees should not be discriminated against as long as they
are capable of performing the work.
5. Religions
Discrimination based on religious beliefs, religious observances, and practices is
forbidden. Further employers are required to "accommodate the religious needs
of employees" when such accommodation can be made without serious
inconvenience to the firm.
6. Nationalities
The EEO guidelines prohibit its discrimination on the basis of language
requirements, height and weight requirements, membership to organisations
promoting rights of particular groups, and having a surname indicative of a
particular national origin.
7. The Handicapped
A handicapped person is one who has a physical or mental impairment that
substantially limits one or more of life's major activities, or one who has a record
of such impairment or is regarded as having an impairment. Thus, one who had
been in a mental hospital, but is now mentally sound might still be regarded by
some employers as physically disabled because of the record of mental illness.
Moreover, Affirmative action requires that employers should:
Take positive steps to recruit qualified handicapped workers.
Modify human resource practices to meet the needs of the handicapped.
Make reasonable accommodation to the physical and/or mental limitations
of an handicapped applicant.
Train supervisors on how to handle the handicapped employees.
Require all employees to provide strong internal support to the fellow
employees who are handicapped.
8. Health conditions- Medical conditions such as being HIV positive or having
the AIDS sickness, epilepsy, TB, Diabetes, and so on are in many cases not
legal basis for discrimination.
35
CH.6: STRATEGIC HUMAN RESOURCE
PLANNING Chapter objectives.
After going through this chapter the reader is expected to be able to:
Define human resource planning.
Distinguish between human resource planning and strategic planning.
Discuss the strategic human resource planning process.
Understand the outcomes of the strategic human resource planning process
including the need for peripheral employees.
Introduction:
All organisations require resources in order to accomplish their goals. The main
resources required include the following:
Financial resources such as money and credit.
Physical resources which include buildings and equipment.
machines
People - this is one of the most valuable resources to any organisation. The
supply of human resources must be sufficient to ensure the healthy operation
of the organisation. Thus every organisation needs proper human resource
planning.
DEFINITION OF HUMAN RESOURCE PLANNING
Human resource planning is the process by which an organisation ensures that it
has the right number and kinds of people, at the right places, at the right time,
capable of effectively and efficiently completing those tasks that will help the
organisation achieve its overall objectives. Human Resource planning translates
the organisation’s objectives and plans into the number of workers needed to
meet those objectives. Without clear-cut planning, estimation of an organisation’s
human resource need is reduced to mere guesswork.
The purpose of human resource planning is to assess where the organisation is,
where it is going, and what implications these assessments have on future
supplies and demands for human resources. Attempts must be made to match
human resource supply and demand, making it compatible with the achievement
of the organisation’s future objectives.
Human resource planning seeks to determine the number and kinds of people
the organisation needs now and may need in the foreseeable future and seeks
ways to satisfy those needs - perhaps even to anticipate them (Ferris, G.R; 2001:
16)
Human resource planning is the process by which an organisation ensures that it
has the right number and kinds of people at the right time, in the right places
36
capable of performing the tasks necessary to achieve the organisations
objectives (Armstrong M: 2001; 357)
Human resource planning is the process for ensuring that the human resource
requirements of an organisation are identified and plans are made for satisfying
those requirements. Human resource planning is based on the belief that people
are an organisation’s most important strategic resource and matches resources to
business needs (Bulla and Scott: 1994)
The aims of human resource planning are to ensure that the organisation:
Obtains and retains the number of people it needs with the skills, expertise
and competencies required.
Makes the best use of its resources
Anticipates the problems of potential surpluses or deficits of people.
Develops a well-trained and flexible workforce.
Reduces its dependence on external recruitment when key skills are in short
supply by having a reservoir of its own employees.
HUMAN RESOURCE PLANNING AND STRATEGIC PLANNING
Human resource planning is a product of strategic planning. It determines the
human resources required by the organisation to achieve its strategic goals.
The link between human resource planning and strategic business planning is
important because, in the development of an informal forecast of the firm’s human
resources needs, it is necessary to have input concerning the direction the
organisation will be taking in the future; information such as whether growth or
decline is projected and the type of skills that will be required. It is important to
consider the current and potential availability or supply of human resources skills
in the organisation and the marketplace.
Timely and accurate human resources information may, for example, enable an
organisation to postpone or implement a variety of recruitment and training
activities or to capitalise on the availability of a given mix of skills to pursue a new
venture.
FRAMEWORK FOR STRATEGIC HUMAN RESOURCE PLANNING
The strategic human resource planning process can be captured in a conceptual
model such as the one shown below.
37
Within a broader, more integrated view of the human resource function, career
planning and development activities in organisations represent a logical
component of human resources planning. Making sure that the right people with
the right skills are at the right place at the right time is quite consistent with
helping people plan their careers in organisations and establishing routes to take
and time frames to meet.
HUMAN RESOURCE STRATEGY
A strategy is a game plan that is used to interact with the environment and make
the firm achieve a competitive advantage. Due to the changing dynamics of the
human resource function, there is greater need for human resource strategy.
Companies that are successful are those that begin as early as possible to define
and include in their activities a unique competitive position including the human
resources.
Human resource strategy enables an organisation to remain effective and
efficient in managing people in line with the changing business and environment.
It is a comprehensive approach covering the vital issues such as change
management, competence building, and cultural change and so on.
Business Unit
Strategic Planning
Process
HR function
Strategic Planning
Process
Human Resource Plan
HR Supply and Demand Analysis
Environmental Scanning
Forecasting Succession Planning
Organizational Strategic
Planning Process
Implementation
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The list of personnel strategies is endless. They range from tightly controlling
labour costs, encouraging sales and production performance, to enhancing
employee creativity. Ultimately each is designed to help the organisation fulfil its
mission and objectives. Examples of the range of personnel/human resource
strategies include:
1. Recruitment and selection strategies – some firms wish to promote from
within by looking first at their current employees when filling managerial
positions. Other companies seek managers from outside the company.
2. Personnel planning strategies – some companies do little planning for future
personnel needs. Others use succession planning and computer simulations to
determine the type and number of employees needed
3. Training and development strategies – some companies allow employees to
learn their skills on the job. Others spend thousands of dollars carefully
training employees before they are allowed to assume job responsibilities
4. Performance appraisal strategies – some companies use very informal
performance appraisal systems such as occasionally telling an employee how
he/she is doing over a cup of coffee. Others use carefully developed
appraisals and formal appraisal interviews
5. Compensation strategies – some companies pay below the market rate,
whereas others pay above. A number of companies offer liberal medical,
dental, and hospitalisation insurance plans whereas others do not. Some
companies use incentive pay, sales commissions, and profit sharing; others
pay a flat hourly rate or salary regardless of individual productivity
6. Employment relations strategies – some companies adapt an antagonistic
posture toward unions; others do not. A Company may use a well-defined
progressive discipline system or leave disciplinary actions entirely up to the
supervisor
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THE STRAGEGIC HUMAN RESOURCE PLANNING PROCESS
Human resource planning involves matching the available employees with the
jobs to be performed and taking care of the shortages and overloads that might
be detected. This can be shown in a figure as below.
Strategic Planning
Human Resource Planning
Find out what is available Compare Forecast the HR Requirement
Demand = Supply Demand > Supply Demand < Supply
(No action) (Action). (Action)
(Action)
Steps in Human Resource Planning
1. Assessing the current human resources of the organisation
2. Assessing where the organization is going (objectives)
3. Forecasting the supply and demand for human resources
4. Matching demand and supply
5. Dealing with overloads
6. Outplacement services
7. Dealing with Shortages
1 Assessing the current human resources in the organization.
The human resource manager begins by developing a profile of the current
human resources in the organisation (auditing skills) and the jobs that exist in the
organisation (auditing jobs). This will be done after the human resource manager
is clear of the human resources available in the organisation. This is done by
scanning the internal environment to know what has been happening to human
resource for instance the labour turnover, training levels, absenteeism and death
of employees.
Assessing the current human resources can be done by auditing skills and jobs as
detailed below:
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a. Auditing skills
Once planners obtain an understanding of current jobs and the new jobs that will
be necessary to carry out the organisation’s plans, they can make a detailed audit
of current employees and their skills. The basic source of data on employees and
their skills is the human resource records of the organisation.
This auditing of skills would include developing and analyzing a databank
containing the following information.
A list of names of the employees.
Their level of education and training
Prior employment and time in each job
Current position
Performance ratings
Salary level
Languages spoken
Capabilities
Specialised skills for each employee in the organisation
From a human resource planning viewpoint, this input is valuable in determining
what skills are currently available in the organisation. It can act as a guide for
considering new pursuits for the organisation and can take advantage of
opportunities to expand or alter the organisation’s strategies. This report also has
value in other personnel activities, such as selecting individuals for training and
executive development, promotion and also for transfers.
This analysis also helps an organisation to take advantage of opportunities and
take decisions such as:
Training of employees.
Development of managers.
Employment of more workers.
Separation of unwanted staff.
b. Auditing jobs
The current jobs in the organisation are analysed in terms of the following
The jobs that exist currently.
The number of individuals performing each job.
The reporting relationships of jobs.
How essential each job is.
The jobs that will be needed to implement the organisational strategy.
The characteristics of anticipated jobs.
2. Assessing where the organisation is going
The organisation’s objectives and strategies for the future determine future
human resource needs.
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Demand for human resources is a result of demand for the organisation’s
products or services. Based on estimates of total revenue, the organisation can
attempt to establish the number and mix of resources needed to reach these
revenues.
In some situations, however, particular skills may be necessary and these skills
may be scarce. The satisfactory availability of such skills can determine revenue
e.g. in a data processing consulting firm that finds it has more business
opportunities that it can handle. Thus, in order to forecast future human needs, it
is necessary to forecast the sales or revenues.
3. Forecasting the supply of human resources in the future.
The human resource manager should forecast the future supply of human
resources from both internal and external sources. The internal supply of human
resource will depend on the training and development, transfer, promotion,
retirement policies among other factors.
The external supply of human resource will depend on:
Net migration into or out of an area. Where the net migration is into a
certain area the implication is that there will be plenty of workers to
employ in the future. The opposite also holds.
Individuals entering or leaving the workforce. In many developing
countries, there are many individuals entering the workforce.
Individuals graduating from schools, colleges and universities.
Changing workforce compensation patterns.
Economic forecasts for next few years.
Technological developments.
Actions of competing employees.
Government regulations and pressures.
Factors affecting people entering or leaving workforce.
Demand forecasting is the process of estimating the future numbers of people
required and the likely skills and competencies they will need.
The demand forecasting techniques that can be used to produce quantitative
estimates of future requirements are:
Managerial or Expert Judgement
This method simply requires managers to sit down, think about future workloads,
and decide how many people will be needed to efficiently undertake the
workloads. This can be no more than guesswork unless there is reliable evidence
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available of forecast increases in activity levels or new demands for skills. Either
a “top down” or “bottom up” approach can be used.
Ratio-trend Analysis
This is carried out by studying past ratios between, say, the number of direct
(production) workers and indirect(support) workers in a manufacturing plant,
and forecasting future ratios, having made some allowance for changes in
organisation or methods. Activity level forecasts are then used to determine
direct labour requirements, and the forecast ratio of indirect to direct would be
used to calculate the number of indirect workers needed.
Work Study Techniques
Work study techniques can be used when it is possible to apply work
measurement to calculate how long operations should take and the number of
people required. Work-study techniques for direct workers can be combined
with ratio-trend analysis to calculate the number of indirect workers needed.
4. Matching demand and supply of human resources
The objective of human resource planning is to bring together the forecast of the
future demand and supply. The result of this effort will be to pinpoint shortages
both in number and kind; to highlight areas where overstaffing may exist (now or
in the future); and to keep informed of the opportunities that exist in the labour
market to hire good people, either to satisfy current needs or to stock pile for the
future.
The most important concern must be given to the determination of shortages
which forces organisations to hire additional staff or to transfer people within the
organisation.
Thus comparisons are done on what is available and what is required. This
comparison assists the human resource manager to identify any gaps that may
exist and to come up with the necessary plans to fill in the gaps.
Ideally the demand for human resource is equal to supply. If the demand is equal
to supply then no action needs to be taken. However, there are cases where the
demand is greater than the supply. The organisation should employ more people
if the demand is greater than the supply. However, if the supply is greater than
demand, the organisation should reduce its workforce.
5. Dealing with overloads or surplus
A surplus means that the organisation has more people than it requires. An
organisation with more people than it needs could do the following in order to
downsize:
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a) Attrition and hiring Freeze – through attrition, individuals who quit, die,
or retire are not replaced. Those who remain must handle the same workload
with fewer people. Unless turn over is high, attrition will eliminate only a
relatively small number of employees. Attrition may therefore need to be
supplemented by freezing hiring.
b) Early Retirement/ Buyouts – Early retirement is a means of encouraging
more senior workers to leave the organisation early. To provide this voluntary
incentive, employers make additional payments to employees so that they will
not be penalised too much economically until their pensions and social
security benefits take effect. Such voluntary termination programs or buyouts
entice an employee to quit with financial incentives and it is better than lay-
offs and individual firings.
c) Lay offs – these can be temporary or permanent. A temporary layoff (like
in Tourism, Agriculture and seasonal industries) occurs where workers are
recalled during the peak periods and laid off occurs during slack periods
when the demand is low.
Lay offs may be an appropriate down sizing strategy if there is a temporary
down turn in an industry. Companies have no legal obligation to provide a
financial cushion to laid-off employees.
c) Leaves of Absence without Pay – this gives workers the opportunity to
take leaves of absence without pay. This may provide time for an employee
who is financially capable to leave the organisation temporarily in pursuit of
personal interests such as attending college so as to increase marketability
and mobility. Individuals offered this leave are usually employees whose jobs
may be eliminated in the future.
Other methods of getting rid of excess workers, although subject to ethical
tests, include:
Requiring employees to have certain academic qualifications.
Sacking employees for minor mistakes
Terminating contracts of employment after expiry of the contracts.
Retrenchment – This is when an organisation reduces its workforce
because they do not need them.
Setting unrealistic work targets.
6. Outplacement Services.
These can be referred to a group of services offered to displaced workers
especially those who lost their jobs involuntarily due reasons such as plant
closures.
The range of outplacement services include:
Personal career guidance and counselling
Resume’ preparation
Typing services
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Training on interviewing workshops.
Referral assistance
Reasons for Outplacement
1. Cost – helping workers find jobs more quickly can cut down on
unemployment benefits. This is especially the case in situations where the law
requires displaced workers to be paid until they get other jobs. 2. Company image – outplacement efforts typically project the image of the
company as a caring employer. Such a firm may not experience a lot of
difficulties in future when it wants to get new employees. 3. Legal issues – the longer employees are out of work, the more likely they are
to consider suing for damages. 4. Social responsibility – some believe that employers have a moral or ethical
obligation to former employees.
Typically, outplacement is done using outside firms that specialise in providing
such assistance.
7 Dealing with Shortages
If the results of human resource planning indicate a shortage the following steps
should be taken:
Outsourcing
Use of temporary employees
Careful use of overtime
Part-time employees
Recruitment- this should be the last resort because it has serious consequences. Thus before an organisation commits itself to employing
people on long term basis, it should consider all alternatives to full time
employment.
Alternatives to full time employment Organisations normally employ full time, permanent or “core” employees and
the peripheral employees.
The core employees are essential for the direction, coordination, and
development of the firm’s activities. They include:
Managers
Team leaders
Professional staffs in fields such as finance, legal, and personnel.
Knowledge workers involved in the development and management of new
technologies.
Technicians and highly skilled workers in laboratories, design offices, and
manufacturing departments who play key roles in projects or work teams.
Peripheral or contingent employees can be categorised into temporary workers,
part- time workers, job sharing, new technology (home working & teleworking),
and sub contracting.
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Temporary workers, also known as “temps” are used to reduce the cost of
employing people on permanent basis. Besides providing cover for staff
shortages, sicknesses, or holidays, they can be used to match fluctuations in the
level of business activity.
Part-time workers are paid for the period they are engaged. Advantages
associated with their use include:
More scope for flexing the hours worked.
Better and longer utilisation of the plant and equipment.
Lower unit labour costs
Higher productivity.
Some of the disadvantages of part- time workers are:
They may be less willing to work at certain times and they may be less mobile.
High rates of employee turnover.
Less commitment compared to full time workers.
Job sharing occurs where two or more employees share the work, pay and
benefits of one full time position. Advantages of this include reduced employee
turnover and absenteeism. Greater continuity of work occurs because even if one
person is absent, the other(s) will be present. Those who cannot occupy full time
positions will also fit into the organisation. Disadvantages include the
administrative costs involved and the risk of responsibility being divided.
New technology (teleworking and home working) involves people working at
home with a terminal linked to the main company and possibly networked with
other outworkers. It enables an organisation to achieve greater flexibility, rapid
access to skills and the retention of skilled employees who would otherwise be
lost to the company. Teleworkers can be used in functions such as marketing,
finance, personnel, and management services. Telecommuting enables a firm to
have its work done in low labour cost areas and to have its employees located
anywhere on the globe.
Subcontracting is advantageous since it enables an organisation to concentrate
its resources on the core business activities. Employment costs are also reduced
while flexibility and productivity is increased. Job security for the core
employees is enhanced. The drawbacks include clarifying the legal status of
subcontractors for income tax, National Insurance, and employment legislation
purposes. It may be difficulty to control the quality and delivery of the goods and
services of subcontractors. At the same time, some employees and trade unions
may react negatively to the use of subcontractors since they may want all the
work to be kept within the company.
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CONCLUSION
Human resource planning is a key element for the success of any organisation.
The environment and customer needs keep on changing. When this happens, the
whole business set up in an organisation has to change. This makes management
of human resource challenging and more complex. The human resource manager
should make human resource planning a continuous process for the organisation
to achieve its goals.
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CH. 7: RECRUITMENT AND SELECTION
Chapter objectives.
Following the completion of this chapter the reader should be able to:
Examine and analyse the process involved in the recruitment and selection
of employees.
Understand the different sources of internal and external recruitment
Explain how to deal with shortages of managers both in the short run and in
the long run.
Analyse and discuss a wide range of pre-employment test that can be used
to screen potential employees.
Introduction
The human resources of most organisations are viewed as their most important
asset. The successes and failures of organisations are largely determined by the
calibre of its work force (starting with the organisation’s management) and by the
efforts it exerts. The employees a firm has can create a major difference for the
firm. Therefore the policies and programs the enterprise adopts to meet its work
force needs are of vital significance.
The employment function of a human resource department comprises the areas
of:
Manpower Planning
Recruitment
Selection
Placement
Performance Appraisal
The changes of personnel status such as transfers, promotions, lay-offs,
discharges.
In administering these activities the personnel managers work closely with
operating/functional management
RECRUITMENT
This is the development and maintenance of adequate manpower sources. It
involves the creation of a pool of available labour from which the organisation can
draw when it needs additional employees.
Recruitment can also be described as those activities in human resource
management which are undertaken in order to attract sufficient job candidates
who have the necessary potential, competencies and traits to fill job needs and to
assist the organisation in achieving its objectives. Through recruitment an
organisation will be able to attract and retain the interest of suitable applicants
and to project a positive image of the organisation to outsiders.
The recruitment exercise should be done very carefully because employees are
very costly to maintain. Therefore, employing the wrong person means paying
for poor services. People have different performance levels and the success of
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other activities such as training may heavily depend on the kind of people
recruited.
When there is an opening in an organisation, the department concerned fills the
personnel requisition form whose contents are a job description and a person
specification. Openings often arise from resignations, promotions, or transfers
among other methods.
Human resource requisition form
This form contains both a job description (job profile) and a person specification
(person profile or a job specification).
The job description describes a job in terms of:
The title of the job.
Duties and responsibilities involved in the job.
Reporting relationships (below and above the position).
Technical requirements of the job.
Geographical location and coverage of the job.
Degree of autonomy expected of the job.
The personnel specification includes details in the lines of:
Attainments i.e. the standards of education and qualifications, experiences
and successes.
Physical requirements including appearance, speech and so on.
Aptitudes and qualities such as ability to communicate and self-motivation.
Dispositions in the line of sense of maturity and responsibility.
Interests outside the job.
Personal circumstances such as marital status.
The personnel requisition form is then forwarded to the human resource
department so that the right person can be acquired.
Sources of recruitment
There are basically two (2) sources of recruitment namely:
Inside sources
External/ Outside sources
INSIDE/ INTERNAL SOURCES:
In filling vacancies from inside the firm, it is necessary to match job recruitment
with the workers’ qualifications. The selection process must still be employed.
Internal recruitment means that present employees are given the first chance for
any better or more attractive jobs that arise before outsiders are considered.
Three methods can be used to recruit from among present employees.
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The personnel director and members of the operating management can review
personnel records and appraisals forms to find qualified candidates. This is used
especially for lower level employees. Employees under consideration may be
totally in the dark about the goings-on until the selection is formally announced.
There is also the possibility that fully qualified potential candidates will be
overlooked due to an oversight. This is the procedure followed in most
businesses and industries.
The vacancy can be announced in the firm’s notice boards for any person who is
interested to apply (job posting). This grants the employees just as much right to
apply for the job as the employer would grant to outsiders who answered an
advertisement in the newspaper. The bulletin board notice specifies the job title,
rate of pay, qualifications that the employee must possess among other things.
Employers quite logically seek to have the job assignments go to the most
qualified persons as decided by the management.
Inside moonlighting is an internal recruitment source used for short-term needs
or small jobs, which do not involve a lot of additional work. The organisation
offers to pay bonuses of various types to people who would like to perform the
additional tasks.
Advantages of internal recruitment:
Most people expect to advance to positions of higher pay and status during their
working careers. An opportunity to achieve these hopes fosters high morale. One
opening in the higher level may cause a succession of individual advancements
as people each in turn move up.
Management can more accurately appraise the skills, knowledge and personality
characteristics of present employees than it can for job applicants who are
interviewed in the employment office. Therefore, there is less risk of error in the
selection and placement process.
The recruitment and selection problem is simplified because there are only a few
entry jobs to recruit for and the formal education, skills and knowledge
requirements for these entry-level jobs are relatively low.
It also promotes the culture of the organisation. Further, there will be less
induction time since the employee is already used to the organisation. The whole
process of recruitment is less costly in terms of time and financial requirements.
Internal recruitment is not only good public relations but it also encourages good
individuals who are ambitious. When planned properly, it can also act as a
training device for developing middle and top level managers.
Limitations of Internal Recruitment:
In order for the company to fill its job openings from within it must have in
operation training programmes by which people in lower level jobs can learn
new skills in order to qualify for upgrading to more demanding work. Small
organisations often feel that they cannot afford the expense of comprehensive
employee training programs.
A policy of upgrading from within requires that the persons hired have the
aptitudes and potential for moving ahead to the next higher level jobs. Sometimes
this leads to the “Peter Principle” whereby one is promoted from their highest
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levels of competence to their highest levels of incompetence.
External recruitment will be limited to lower level positions and the new recruits
may be overqualified for the lower level jobs.
If the purported promotions for the overqualified persons recruited externally do
not actually materialise, these over qualified persons may be disappointed at
their lack of progress; consequently, the rate of labour turnover may be high.
An exclusive promotion from within policy prevents the infusion of new ideas and
knowledge at upper levels. This in effect may be referred to as organisational
inbreeding. Subordinates having been taught and modelled by their bosses may
not know other ways of doing things. When promoted to position of power and
influence, they tend to perpetuate possibly outdated practices.
As a generalisation, the most fruitful policy is that of filling the majority of
vacancies from within but going to the outside when fully qualified talent is not
available inside the organisation. It is also probably wise to fill a moderate
percentage of the higher-level managerial and professional positions by going to
the outside labour market to inject new ideas to the organisation.
EXTERNAL/ OUTSIDE SOURCES
There are many sources of employees outside the organisation. The particular
sources and means by which workers are recruited vary greatly. It depends upon
the management policy, the type of job involved, the supply of labour relative to
demand and the nature of the existing labour market institutions such as
employment agencies, trade unions, and so on.
The principal sources and methods for recruiting manpower include:
Employment agencies
These may be public or private. For a fee collected usually from the employee
(after he/she is hired) but sometimes from the employer they help to meet
employer requests for people from their files of job seekers who have registered
with them. Many agencies do a careful job of interviewing, testing, counselling,
and screening to match the employer’s specification and demands and the
abilities and needs of the job applicant. Many agencies concentrate on white-
collar office and retail sales personnel, because demand is generally high and
turnover is great. However, many top status people especially sales people don't
look for employment through employment agencies. In Kenya employment
agencies include "My jobs Eye”, Manpower Services, Federation of Kenya
Employers (FKE), Deloitte & Touché, Price Waterhouse Coopers, Preferred
Personnel, Sheer Logic, Hawkins & Associates, Career Connections, and a variety of
advertising agencies.
Labour unions
This source of employees is used primarily in those occupations in which the
employees are represented by trade unions. Some of the industries and
occupations, which tend to obtain some or most of their labour force through
unions, are construction, clothing, and popular dance bands among others.
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Generally, those union members who have been unemployed for the longest time
are given the first opportunity to fill the job opening. This ensures that
unemployed workers will get jobs in their rightful turns. Examples of labour
unions in Kenya include Central Organisation of Trade Unions (COTU),
Federation of Kenyan Employers ( FKE), Kenya Union of Post Primary Education
Teachers( KUPPET), and Kenya National Union of Teachers (KNUT).
Unsolicited applicants at the employment office
For jobs requiring only routine abilities and skills, many employers are able to fill
their labour needs largely by directly hiring at the gate. It is used to obtain many
manual workers and sales people. At other times prospective employees apply
directly to the organisation in the hope that a vacancy exists or they can complete
application forms and send them to the enterprise concerned.
This method is cheap and improves the image of the organisation. An
organization which treats its employees well, pays adequate wages, and which
has enlightened personnel practices will easily attract potential employees.
However, the applicants may get jobs else where before being engaged by the
organisation.
Employee recruiting
It is also known as employee referrals or employee recommendations.
Some organisations announce to their own employees that they wish to hire
additional people possessing certain type of skills. The employees would then
pass the word to their friends and relatives who may be seeking work. The
principal advantage of employee recruiting is that it is selective. An employee
would not recommend grossly unqualified persons because he/she feels that
these will reflect adversely upon his/her own reputation. Ideally those
recommended are individuals who are likely to make an excellent contribution to
the organisation. This method is inexpensive and very effective in finding
candidates with specific skills quickly.
Nevertheless, recommenders may confuse friendship with job performance or
competencies. Individuals often like to have their friends join them at their place
of employment for social and economic reasons such as rides to and fro work yet
the friend may lack job-related competences.
Employee recruiting may lead to nepotism whereby individuals hired are
related to those already working in the organisation. Sometimes it leads to racial
imbalance through, for example, whites recommending whites only. At other
times, it prevents the infusion of better blood by preventing a wider pool of
applicants that would have applied if the position had been advertised.
Advertising
Advertising can be done in newspapers, magazines, professional society
journals, Televisions, radio, and public notice boards among other places.
This is a widely used method of recruiting. With some exceptions, employers who
advertise for applicants should reveal their own identity rather than use a blind
advertisement. This is sound ethically because the employer also expects the
candidates to supply detailed autobiographical information. Likewise this
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prevents the possibility of the employer’s own employees (those who are
dissatisfied and seeking to make a change) unknowingly applying for a job at
their own company. In some cases, firms hide their identity. This occurs in
situations where the firm has a poor reputation which may prevent it from getting
applicants or where the firm’s reputation is so good that it will have numerous
applicants.
Although this approach is costly, it avails a wide choice of applicants and there is
some equity in using it.
Competitors – this source of recruitment avails persons who are already used
to the industry dynamics and who have their own customers with whom they
may move. Nevertheless it can result to bad blood among the competitors.
Hardcore unemployed – General Motors used this approach at one time in
Detroit City, USA, to prevent riots in the streets. Care should be exercised
when using this source.
Internet- through the Internet one is able to attract many recruits from
different parts of the world.
Other Industries- a firm in the media industry may recruit from, say, the
pharmaceutical industry. New perspectives are then brought into the
organization.
Educational institutions ( i.e. Schools, Colleges, and Universities)
This recruitment practice tends to be utilised by large companies. Such firms
usually send their recruitment teams to the educational institutions to make
presentations. In other cases, the firms invite prospective students to visit their
plant where the final employment decision is usually made.
Schools, colleges, and universities avail intelligent and wise employees but
sometimes they may lack the experience required. This problem can be arrested
by arranging for internships of students. Further, the rate of labour turnover is
very high especially among younger school or college leavers. They quickly take
advantage of opportunities for “greener pastures” unlike elderly employees
whose rate of job mobility is lower.
Professional bodies
Accounting, engineering, and scientific institutes look after the interests of their
members by allowing vacancy advertisements in their publications.
Opportunities for networking are also afforded through conventions. Examples
are Institute of Certified Public Accountants of Kenya (ICPAK).
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Head hunting
Top professional people are hunted through specialised agencies. The persons
are approached personally with an offer to fill a vacancy. Alternatively, an
advertisement is written with the specific person’s CV in mind. Those hunted are
highly effective executives who have the skills to do the job, can effectively adjust
to the organisation, and who are willing to consider new challenges and
opportunities.
Consultants
Recruitment consultants or placement agencies have a broad network base and
are exposed to management in action. They often offer a placement service to
client companies.
Temporary help services- certain organisations provide employees to
meet short-term fluctuations in personnel needs in areas such as nursing,
computer programming, library services, secretarial among others.
Factors that constrain the process of recruitment.
Some of the factors that may make the human resource manger not to recruit the
best employees include:
Poor image of the organisation;
Unattractive jobs or job descriptions;
Internal organisational policies that mainly promote internal recruitment;
Pressure form the trade unions on who should be recruited;
Government laws and regulations such as the Equal Employment Opportunity
Act;
Where the costs of recruitment are too high;
SPECIAL PROBLEM OF PROFESSIONAL PERSONNEL AND MANAGERS
Normally employers don't have difficulty in obtaining adequate employees for
manual, clerical, sales and general administration type of works. But they have a
problem in obtaining the professional and managerial talent they require. In the
short run, the individual firm faced with the shortage of qualified talent must
result to an aggressive recruitment campaign. Among the more prominent
advertising techniques are;
Advertising in newspapers, college papers, trade journals and professional
journals
College recruitment and contacts with university career offices
Management consulting firms
Executive recruiters and agencies (Head Hunters)
Professional association meetings
The long-term solution to this problem would be for organisations to invest more
in training managerial talent.
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SELECTION
Once recruitment is done the candidates are selected. Selection is a process
whereby out of the many job applicants the best are taken to fill the vacancy. To
assist the selection process the potential candidates fill in job application forms
whose contests are:
Personal Information
This includes their name, address, telephone number, marital status, date of
birth, age, gender, nationality, languages spoken, tribe, weight & height (body
mass index), and next of kin
Educational Background
Schools passed through (primary and secondary)
Further and higher education institutions attended
Qualifications attained
Special training
Membership to professional bodies
Employment History
Companies worked for
Dates of employment
Positions, duties and responsibilities
Military service
Other Interests
Sports
Hobbies
Membership to societies/clubs
Referees
Academic referees
Work related referees.
This form gives a common basis for drawing up a shortlist and provides a
foundation of knowledge, which can be used as a starting point for the interview.
The information can also assist the post-interview decision making stage.
It is from the application forms that the first group of candidates will be short-
listed for the first interview, which in many cases, is the aptitude test.
The information gives an indication of an applicant’s suitability for a job. Past
behaviours can be used as an indicator of future performance potentials and the
length of service expected from the potential employee
The accuracy of the information given in the application form may need to be
ascertained. This can be done by using reference checking and requiring the
applicant to sign a statement confirming its accuracy and stating the potential
effects of false information.
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THE INTERVIEW
Most companies pass potential employees through several interviews depending
on the requirements of the job. The interviews can be administered by the human
resource department alone or in conjunction with the departmental management.
In some cases, the departmental management holds the initial interview. In most
cases, the personnel management and departmental management make the final
choice. Yet in a few cases, the departmental management makes the final
decision without consulting the human resource department.
INTERVIEW SETTING
The human resource manager should prepare the interviewing panel by setting
time, date, and venue. Moreover, all the people who will participate should be
informed and the roles or questions they will ask determined in advance.
Effective interviews can be held in the following setting:
The room where it's held should be free from interruptions by colleagues,
telephone calls, visitors and so on. A very large room with a few people
occupying it makes it lack the intimacy required for a free and natural discussion.
Large desks or tables separating the parties increase their psychological
differences. Consequently, less information may be acquired.
. CONDUCTING THE INTERVIEW
When candidates come into the interview room many of them are anxious. The
anxiety may stem from a strong desire to get the job or from other reasons. The
personnel manager has the duty of reducing anxiety. There are a number of
guidelines, which if followed should reduce anxiety and establish rapport. These
include:
One of the interviewers (preferably the departmental manager or even the
human resource manager) should bring the candidate to the room, rather than
the candidate being sent for through a secretary or a junior administrator.
Secondly, the conversation should be opened with a few easy to answer
questions, which, although not directly related to the job, allow the candidate to
talk to the interviewer and gain confidence. The questions here range from
introducing oneself to a brief history of oneself, or they may even touch on a
recent happening that is causing concern in the town or in the country.
Continuing in this vein of easy questions, questions early in the interview should
be open-ended rather than closed ended. Open-ended questions allow the
applicant scope for talking at some length on a particular topic. However, some
closed-ended questions may be inevitable.
The panel of interviewers should be courteous and appear interested in what the
applicant says, even when it is not what they were expecting to hear. Interviewers
should not engage in activities such as making phone calls, smoking, and
discussing among themselves when the candidate is expressing himself or
herself. The interviewers must also be relaxed and friendly.
To encourage candidates to talk about themselves and their experiences the
following techniques can be used:
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Play Back Technique- This involves repeating the last few words of the
candidates’ last sentence in order to find out the reason for the answer that was
given.
Use of Rewards - The interview can reward the candidate for their achievements
by using:
Encouraging sounds such as Uh!, I see!, Mmmh!
Eye behaviour -narrowing of the eyes together with a slight nod of the head
can convey the messages "Uh!, I see!, Mmmh!"
Body language such as the interviewer sitting posture when it is upright and
the candidate is being given attention.
Use of Silence -It is used where the candidate has stated a point which is not
clear, he/she should be given time to explain it. This should be used with care
otherwise rapport may be lost.
Use of Probes/ Research- Where a candidate has given a statement, which is
unclear, the interviewer should ask questions to find out why the statement was
given.
Summarising- The interviewer can summarize the points raised by the candidate
in order to gain agreement before proceeding to the next point.
Use of Neutral Questions- Interviewers should ask questions which are neutral
and which don't elicit 'yes' or 'no' responses.
OTHER CONSIDERATIONS
The interviewer shouldn't talk too much
The human resource manager should also sell the job to the candidate
The interviewer must control the interview
The interviewer should close the interview when sufficient information has
been obtained. In closing the interview, the candidate may be asked to raise
any questions which they may have.
At the end of the interview, the interviewers explain when the decision will be
made and how it will be communicated to the candidates. Thereafter, the
candidate is thanked and escorted out of the interview room.
After the interview, unsuccessful candidates are sent regret letters. Successful
candidates may be sent letters of job offer. However, additional tests
(psychological tests, medical tests etc) may be required before the candidate is
fully given the job.
PRE-EMPLOYMENT TESTS
Attracting qualified applicants for a job through the recruitment process is only
the first step in the process of acquiring new employees. The organisation must
develop techniques for selecting the right person from among the many
applicants for the particular position.
It is essential that management should avoid employing a person who may well
soon or later resign because the job he was selected for does not meet his/her
expectations, bearing in mind that recruiting, selecting, and training costs are
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necessarily high. Further, there is normally a time lag between the time an
employee leaves the firm and the time a qualified replacement is found.
There are various selection techniques used in Kenya such as the interviews and
the application forms. The interview enables the person responsible for engaging
new employees to view the total individual and so evaluate the person and
his/her demeanour directly.
The application forms main value is in recording information on the personal
history of the applicant. Among other things the application form records age,
marital status, number of dependants, education, training, work experience and
so on. The application form as a selection technique may also have elements of a
formal selection test.
Tests have been used in an effort to find more objective means of measuring the
qualifications and liabilities of potential employees. Tests can also be used on
employees earmarked for transfer or promotion.
An employment test is an instrument that is used to obtain information about
personal characteristics.
The main benefit of tests is that they may uncover qualifications and abilities that
would not be discovered by the interview and application form. Tests will also
eliminate the prejudices and biases of the interviewer and selection panels. In
Kenya, formal tests can pre empty nepotism and favouritism in the selection of
employees. However, formal tests tend to continuously favour those who have
had certain educational and familiar backgrounds given the very badly skewed
distribution of educational and economic resources in the country.
Thus the pre-employment test can be given for the following reasons:
1. To recruit the best candidate for the job.
2. To reduce staff turnover by not recruiting unsuitable employees.
3. Limit recruitment costs.
4. To help employers by providing them with objective data
5. To recruit those who are likely to be most productive
6. To minimise expensive mistakes in selection decisions.
Characteristics of good tests A good test has the following characteristics:
It is a sensitive measuring instrument that discriminates well between
subjects.
It has been standardized on a representative and sizable sample of the
population for which it is intended so that any individual’s score can be
interpreted in relation to that of others.
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It is reliable in the sense that it always measures the same thing. A test aimed
at measuring intelligence should measure the same characteristic when
applied to different people at the same or at different times, or to the same
person at different times.
It is valid in the sense that it measures the characteristic which the test
intended to measure. A test intended to measure intelligence should measure
intelligence and not simply verbal facility.
Type of tests
The main types of tests are:
Aptitude tests
Personality tests
Psychometric tests
Skills tests
Work sample tests
Work styles or traits tests
Specific knowledge tests
Medical tests
Some of the tests are briefly discussed below.
1. Aptitude Tests
These measure the general intellectual ability of a person. The main types of
aptitude tests are the:
mechanical reasoning tests
numerical reasoning tests
abstract reasoning tests
spatial relations tests
verbal reasoning tests
language usage tests
Spelling tests.
The mechanical reasoning tests measure ones ability to understand the
underlying principles behind machines. High scores in these tests indicate
proficiency in engineering and mechanical work. The test is concerned with
whether one can reason through mechanical problems in a logical way. It is a
useful way of measuring a person’s mechanical aptitudes.
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Numerical ability tests measure the ability of a person to add, subtract,
multiply, and divide. These tests are useful in careers such as accounting,
banking, insurance, and the engineering disciplines. Typical questions would
include calculation of measures of central tendency or measures of dispersion or
even the comparison of performance of several firms over a given period of time.
Other issues may also be tested.
Examples would be:
a) What number comes next in the following sequence?
16,8, 4, 2, 1, 0.5, 0.25, ------, --------.
b) A car travels 40 metres in 0.2 seconds. If it continues at the same speed,
how many kilometres will it have covered in 6 hours?
The information in numerical tests is usually presented in texts, graphs, charts,
and so on followed by statements. A person is asked to indicate whether the
statements are true or false, or choose among the given choices.
Abstract reasoning tests measure the ability of someone to reason with
visual configurations. Questions here would contain patterns and series to be
completed. They are a non-verbal measure of reasoning ability and are useful in
architecture, design, draughting, and computerisation (such as Computer Aided
Designs).
Language usage tests are to measure the ability to communicate in good,
accurate grammatical English. It is a measure of how well one can distinguish
between correct and incorrect grammar, punctuation, and wording of sentences.
These tests are useful for careers such as writing, teaching, and journalism.
The spatial relations tests are probably the most difficult aptitude tests. They
are combined with mechanical reasoning tests and applied to people wishing to
pursue technological and scientific careers. Space relations involves the ability to
visualise and think in three dimensions or picture mentally the shape, the size,
and positions of objects when shown only a picture or pattern.
Spelling tests are important for school or college work and for many other
jobs such as accounting, banking, insurance, and engineering. Poor spellings are
not necessarily an indicator of poor levels of education.
Verbal reasoning refers to the ability of a person to reason logically in verbal
terms. It is the ability to comprehend verbal concepts or ideas and see the
relationships between them. They are particularly useful for careers such as law,
psychology, personnel, and different types of management.
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2. Personality tests
These tests are designed to reveal the candidates personal characteristics and
the way candidates may interact with others, thereby giving a measure of
leadership potential.
These are to identify the candidates’ personality types. Personality concepts of
importance to the human resource manager include whether one is an extrovert
or introvert, sensate or intuitive, thinking or feelings led, etc. other aspects of
personality tests are stress, simulation, novelty, dominance, and achievement.
3. Psychometric tests
A psychometric test is a way of assessing a person’s ability or personality in a
measured and structured way. The main psychometric tests are personality,
ability, and interest tests.
4. skills tests
These are job specific and tests ones ability to perform a relevant task. A typing
test is a skills test just like headline writing.
5. Work sample tests
The candidate is asked to produce a sample of their work. A typist may be asked
to type some work.
6. Work styles or traits tests
These are intended to find out how one likes to work. An individual can like
working alone or with others, as a leader or as a follower. Some individuals like to
be praised while others prefer freedom. These tests are administered through a
series of questions to be answered with a yes or no, or choosing the response
from a number of choices. In these tests, there are no right and wrong answers.
7. Specific knowledge tests
These tests measure how much one knows of a particular subject- such as
knowledge of sports.
8. Medical tests
The aim of medical tests are to determine any major medical conditions of the
potential workers that may affect their performance. Some of the diseases for
which potential job seekers may need to be diagnosed include HIV/AIDS,
tuberculosis, asthma, and epilepsy among others. Discrimination based on
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medical condition may be illegal unless the condition will affect the performance
of the individual.
Some of the diseases for which potential job seekers may need to be diagnosed
include HIV/AIDS, tuberculosis, asthma, and epilepsy among others.
Discrimination based on medical condition may be illegal unless the condition
will affect the performance of the individual.
Reference checks
These are conducted after the employment interview to find out more about an
applicant’s employment record, education and training, and behavioural
patterns. Through reference checking, input is obtained from a number of people
and there is useful feedback on the strengths and weaknesses, achievements and
failures of individually. The organisation receives a verbal report on an
individual'’ performance.
References are most useful if the person providing the reference has observed
the candidate in a relevant situation. The person providing the reference must be
capable of assessing the candidate’s performance and he or she must be
prepared to express his or her forthright opinion. Moreover, the person must
express himself or herself in such a way that his or her opinion is not
misinterpreted. Referees have no legal obligation to provide positive feedback
on a person. It is strongly recommended that one chooses referees who know
him/her very well and who can give accurate information. The referees may also
be educators who had the opportunity to interact with the person in a classroom
setting.
INDUCTION AND PLACEMENT
Induction is the socialisation or orientation programme aimed at gradually
introducing the new employee to the organisation, the work unit in which he or
she will be working, the particular work and the people and things which he or
she will be working with. Through induction the new comer will feel at ease much
quickly.
Induction introduces the new employee to the organisation. The letter of job offer
specifies where, when and to who the candidate is to report. Once they report to
the human resource office, the human resource manager takes them to the
departmental head and the employee is taken round the organisation and
introduced to the different departments, facilities, offices and so on. The length of
time taken on the induction exercise will depend on the size and complexity of
the organization as well as on the level in the organization at which the employee
is entering among other factors.
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Induction is important because:
It gives a positive first impression of the organisation.
It ensures the new employee is familiar with the operations, departments and
procedures in the organisation.
It reduces the time taken by the new person to familiarise themselves with
their work and to know how their work relates to other functions in the
organisation
It enables the firm to socialise its management trainees
It enables the employee to gain confidence and perform their duties
effectively and efficiently
Some of the details covered in induction include:
A brief history of the organisation
Conditions of employment and benefits
Remuneration policy;
Work rules and standard procedures;
Disciplinary code and procedure
Grievance procedure
Relationships between the employer and other organisations;
Trade union related matters;
Training and development policy & facilities;
Employee wellness policy;
Medical and first and infrastructure;
Restaurant facilities;
Social responsibility policy;
Community involvement policy;
Issues relating to confidentiality of certain company information.
It helps the new employee to understand what goes on in the firm and what is
expected of them.
Once the employee is inducted they are then placed into their workstations.
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Ch. 8: EMPLOYEE TRAINING.
Chapter objectives At the end of this chapter one should be able to understand and appreciate:
The principles of learning and how they relate to training.
The major differences between pedagogy and andragogy.
The training process for employees.
Training programs for non-managers that are designed to develop their
skills to perform jobs.
Training and educational programs for executives which enable them to
develop the ability to manage.
The process of designing effective management development programs.
Programs designed to improve organizational units as entities.
INTRODUCTION Recruiting, selecting, and inducting an employee are not an end in themselves.
The employee must be trained and developed to fit into the organization. In fact,
all employees require some element of training.
Definition of Training
Training consists of planned programs designed to improve performance at the
individual, group, and/or organisational levels. Improved performance, in turn,
implies that there are measurable changes in knowledge, skills, attitudes, and/or
social behaviour.
Training is a learning process whereby people acquire skills or knowledge to aid
in the achievement of goals. In a limited sense, training employees provides them
with specific, identifiable knowledge and skills for use on their present jobs.
Development is broader than training in that the individuals gain new knowledge
and skills useful for both present and future jobs ( Mathis $ Jackson, 2000).
Training seeks a relatively permanent change in an individual which change will
improve his/her ability to perform on the job. Training typically involves the
changing of skills, knowledge, attitudes, or social behaviour. It can involve
changing what employees know, how they work, their attitudes towards their
work, or their interactions with their co-workers and their supervisors.
Ideally training is job related learning that employers provide to their
employees. The main aim is to improve employees’ skills, knowledge and
attitudes so that they can perform their duties according to set standards. In
contrast to training (which is job related) and education (which is the preparation
of an employee for a different job), employee development is a broad term which
relates to training, education, and other intentional or non intentional learning
and which refers to general growth through learning.
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Reasons for training Training is necessary for the following reasons:
Employment of inexperienced and new labour requires detailed instructions
for effective performance on the job.
Older employees need refresher training to enable them keep abreast of
changing techniques and the use of sophisticated tools and equipment;
Training is necessary when a person has to move from one job to another
because of transfers, promotion or demotion.
Increasing use of fast changing techniques in production and other operations
requires training in newer methods of operation.
Training enables people to work effectively with minimum supervision. It also
reduces work related accidents.
Training leads to increased productivity, heightened morale, low wastage,
reduced spoilage of materials, reduced costs and better quality goods and
services all of which enable an organization to achieve greater stability.
TRAINING AND LEARNING
In order to understand what training techniques can do to improve an employee's
job performance it is necessary to understand the concept of learning. Ideally
learning is the process of knowing what was previously not known.
PRINCIPLES OF LEARNING
1. Learning is enhanced when the learner is motivated.
An individual must want to learn. When the desire exists, the learner will exert a
high level of effort. People are more willing to learn when the material is
important to them and will help them to achieve the goals they have set for
themselves. Some of the goals that may encourage intention to learn in certain
people include the desire for achievement, advancement, authority, co-workers
influence, comprehension, creativity, curiosity, fear of failure, recognition,
responsibility, status, and a variety of other reasons.
Further, trainees must perceive the organisation and their immediate work
environment as supporting participation in training and using what has been
learned. If they perceive the organization as not supportive then they will not be
motivated to learn.
2. Learning requires feedback.
Feedback, or knowledge of results, is necessary so that the learner can correct
his/her mistakes. Feedback, or knowledge of results, is best when it is immediate
rather than delayed. Immediate feedback can come from observers, the
performer, or the task itself.
The sooner individuals have some knowledge of how well they are performing,
the easier it is for them to correct their erroneous actions. When individuals
obtain feedback on their performance, the task becomes more intrinsically
interesting and acts to motivate them.
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3. Reinforcement increases an individual’s likelihood of repeating a
learned behaviour.
Reinforcement can be positive (to encouraged or sustain a desired behaviour) or
it can be negative (to suppress unwanted behaviour).
Punishment (negative reinforcement) tells learners that they are doing something
wrong. When workers are verbally praised upon properly performing a task, it
encourages learning and they are likely to continue doing the task in that way;
they will even be motivated to strive toward performing better work. Thus,
positive reinforcement encourages learning.
4. Practice increases a learner's performance.
Anyone learning a new skill or acquiring factual knowledge must have an
opportunity to practice what he/she is learning. When learners actually practice
what they have read, heard, or seen, they gain confidence and are less likely to
make errors or to forget what they have learned. Active involvement through
practice must be made part of the learning process.
5. Learning curves.
Learning begins rapidly, and then levels off. The rate of learning can be
expressed as a curve that usually begins with a sharp rise, and then increases at a
decreasing rate until a plateau is reached. Learning takes place very fast at the
beginning, but then levels off as opportunities for improvement are reduced.
6. Transfer of learning.
Transfer refers to the extent to which competencies learned in training can be
applied on the job. Positive transfer occurs when job performance is improved as
Common
learning
curve.
Time
Amoun
t of
learnin
g.
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a result of the training. Zero transfer occurs when there is no change in job
performance as a result of the training. Negative transfer occurs when job
performance is worse as a result of the training.
Near transfer occurs when the material learned can be directly applied on the job
with little adjustment or modification, while far transfer occurs where the material
learned must be modified or expanded upon before it is used.
7. Split the material into meaningful chunks rather than presenting it all
at once.
Trainees can absorb only a limited amount of information at a time. In situations
where the subtasks learned are relatively easy to perform and are inter-related,
all the material can be learned at once. An example is learning how to operate a
power saw. Otherwise the material must be broken down into reasonable chunks
and presented at different times.
8. Try to use terms and concepts that are already familiar to trainees.
The use of jargons and unfamiliar terms should be discouraged. Where new
concepts and terms are to be used, then the familiar terms and concepts should
precede them.
9. Maximise the similarity between the training situation and the work
situation.
The principle of identical elements suggests that the more similar the training and
the performance situations are in terms of the stimuli present and the responses
required, the more likely it is that training transfer will occur. Customer care
experts who are expected to work with angry, impatient customers should
practice with role models of such customers. The similarity can be in terms of
physical elements such as equipment, tasks, and surroundings; it can also be
psychological.
10. Label or identify important features of the task. Where the training
relates to the use of machines then important operations must be labelled.
Examples are the "starter switch" or the “stop switch”.
11. Trainees learn best when they learn at their pace.
This is because some are slow learners while others are fast learners.
TRAINING ADULT AND OLDER WORKERS The ageing population in many countries implies the need to train elderly
workers. Pedagogy is the process of educating children and teenagers through
high school while andragogy is adult oriented learning.
Andragogy is based on four assumptions about differences between adults and
children:
Adults are self directed
Adults have acquired a large amount of knowledge and experience that can
be tapped as a resource for learning
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Adults show a greater readiness to learn tasks that are relevant to the roles
they have assumed in life.
Adults are motivated to learn in order to solve problems or address needs,
and they expect to immediately apply what they learn to these problems and
needs.
Other differences between adult learners and the younger learners (mainly those
learners who are below the age of majority) are summarised in the table below.
Table 3: Differences between pedagogy and andragogy.
Young learners ( pedagogy) Adult learners ( andragogy).
They need motivation since they may
not be sure why they are in training.
Highly motivated and want to learn.
Raise few questions since they have
few real world experiences to draw
from.
Raise many questions as they try to
connect class material with real life
experiences.
They have developed a tolerance for
bureaucracy.
Low tolerance for bureaucracy
Resist participation and expect to be
told what to do and when to do it.
Want to participate.
Future oriented since they expect to
apply the material learned in the
future.
Concerned with immediate problems
and their solutions
Their major focus is on grades Primarily concerned in content and its
relevance to career and personal life.
Tend to be idealistic Tend to be practical
Have a restricted world view Have considerable knowledge to
bring to training.
Want to know the “answer” and tend
to see things in one way
Look at problems as having several
possible alternatives worth evaluating
Impatient and want things to happen
“overnight”.
Have patience with the world and
understand that change takes time.
Likely to accept the information they
are given.
Can and will verify the information
given in the training.
Have few specific expectations They have preconceived expectations
about the training.
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THE TRAINING AND DEVELOPMENT PROCESS
The process of training and developing employees can be shown in a simple
diagram as below.
Fig 1: The training and development process.
Conduct a training needs analysis
Establish the training objectives.
Select the training methods and
Conduct the training
Evaluate the training
1. TRAINING NEEDS ANALYSIS:
a. In order to know what to train workers on, it is necessary to carry out a
Training Needs Analysis. The training needs analysis finds out what
training or development employees actually need and want to acquire,
and the conditions which are necessary for ensuring that training or
development will be practically useful to the organisation.
To know that employees need training the manager can get a clue from:
a. Decreased productivity.
b. More grievances reported.
c. Complaints from customers.
d. Equipment utilization figures.
e. Training committee observations.
f. A high reject rate.
g. Greater than usual scrape or wastage of materials.
h. A rise in the number of accidents reported.
i. Changes imposed on the employees as a result of job redesigns or a
technological breakthrough.
Nevertheless, it should be known that employees might not excel in their
performance because of other reasons such as:
Low managerial authority
Ambiguous job descriptions
Red tape
Haphazard personnel management activities
Low motivation, morale and job description.
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Some of the methods used for assessing training needs include:
1. Observation and analysis of performance
2. Management and staff conferences and recommendations
3. Analysis of job requirements
4. Consideration of current and projected changes
5. Surveys, reports, and inventories of current employees
6. Interviews with incumbents, supervisors and clients;
7. Assessment centres;
8. questionnaires
9. diaries
10. coaching
11. Work planning and review systems.
12. Delphi technique;
13. Collection of critical incidents;
Managers should be able to differentiate between competence and performance.
Competence refers to the ability to do certain jobs while performance is the
achievement of practical results in a work situation.
For training to be conducted there has to be a performance gap between the
desired or optimum level of performance and the actual or real level of
performance.
Some organisations do not conduct a training needs assessment because of
reasons such as:
The needs assessment exercise can be a difficult, time consuming process.
Managers may decide to use the limited resources available to develop,
acquire, and deliver the training rather than to do the preliminary activities.
Incorrect assumptions are made that a needs assessment is unnecessary
because available information already specifies what an organisation’s needs
are.
There may be lack of support from the top management.
Some of the trainees may resist the needs assessment exercise because of the
benefits they get from their current positions or where they don’t trust their
supervisors. This is sometimes the case in public service positions.
Needs assessment should be done at the organisational level to determine where
training is needed and in what conditions the training will be conducted. It is also
done at the task level to determine what must be done to perform the jobs more
effectively. At the personal level needs assessment helps us to know who should
be trained and the kind of training they need.
2. ESTABLISH TRAINING GOALS
Management must explicitly state what changes or results are sought from each
employee. These goals should be tangible, verifiable, and measurable (as far as
this is possible). They should be clear to both management and the employee.
The clarity of goals is influenced by how they are communicated. The goals
should be in line with the problems that gave rise to the training. An example
would be improved productivity of the workers. The objectives should be written
down as concisely as possible using a language that can be easily understood by
all the interested parties.
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Examples of training objectives would be to increase the productivity of the firm
within one year, to reduce the rate of wastage or scrappage or even to reduce
customer complaints.
3. SELECTING THE TRAINING METHOD:
Appropriate training methods should be able to:
Motivate the employees to improve their performance
Explicitly illustrate the skills desired by the employee
Make employees to participate effectively in their work assignments
Provide the trainee with the opportunity to apply the skills in the practical
work situation.
Provide immediate feedback on employee performance during training.
Human resource managers must make the decision as to whether the training will
be provided by the firm’s staff or by external parties. This decision is made
considering the following factors.
a) Expertise- when the firm lacks the knowledge, skills, and experience to
design and implement a training program, then it must rely on external
parties. b) Timelines- sometimes it is timelier to hire outsiders to undertake the
training. c) Number of trainees- where there are many trainees then it may be more
cost effective to offer the training using the firm’s personnel. d) Subject matter- in cases where the subject matter is sensitive, then the
firm’s employees become the trainers. e) Cost- this factor should be considered together with the other factors.
f) Size of the human resource department- smaller departments may lack
the capacity to train employees. g) Other factors- these include personal contacts or past experiences with an
outside vendor, geographical proximity to the vendor, local economic
conditions, and the presence of the government incentives to conduct
training.
Each external party wishing to provide the training would need to be evaluated in
terms of their cost, credentials, experience, background, delivery method, topics
they wish to cover, and expected results among other factors.
It is also necessary to select the trainer(s) and train them before they embark on
the training. Lesson plans should be prepared in which issues such as topics to be
covered, sequence of the activities, and timing of each activity among others are
discussed.
CLASSIFICATION OF TRAINING METHODS Training methods can be classified as either on the job, off the job or self
paced.
a. On The Job Training (OJT):
This is one of the widely used methods of training. The employee is physically in
the work environment and appears to be immediately productive. It is learning
while doing. This is known in some industries as “Sitting with Nelly” implying
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that one person sits under another in order for the learner to learn from the
experienced person.
Advantages of On the Job Training
The transfer of training to the job is maximised;
The costs of a full time trainer and training facilities is eliminated;
The employees are more motivated because they know that what they are
learning is relevant to their job. Theory is put into practice immediately and its
relevance is obvious.
Much of the learning takes place naturally as part of the performance
management process and through day to day contacts.
Employees are assimilated more quickly into the organisation.
The disadvantages of On the Job Training include:
Low productivity while employees develop their skills
Costly errors made by the trainees while they learn
The effectiveness of the learning is strongly influenced by the quality of the
guidance and coaching provided on the job. Many managers and team
leaders are unskilled at training and may not carry it out or encourage it.
The environment may distract the instructions.
On the Job Training methods include:
1. Induction training- it enables a new recruit to become productive as quickly
as possible. The length of induction training will vary from job to job and will
depend on the complexity of the job, the size of the business and the level or
position of the job within the business.
The following areas may be included in induction training:
Duties of the job;
How to meet new challenges;
Information concerning the layout of the premises;
Values and aims of the business;
Internal working and policies of the business;
The history of the firm including the former and current leadership regimes.
The goods and services of the firm.
2. Coaching- here experienced managers guide the actions of less experienced
managers to help them develop their service delivery. It is one of the most
effective training techniques. The teaching is individualized and one learns by
doing. This method provides immediate feedback on performance.
Nevertheless, it tends to propagate the ideas of current managers and some of
the ideas may not be progressive. The superior may also neglect the person
being coached in terms of time and of the quality of teaching efforts.
Sometimes, coaches are hired from outside the organisation, but increasingly
some organisations expect all line managers to operate as coaches, and it is often
true that a young manager will learn more from senior colleagues than from any
other source or formal learning intervention. Coaching focuses on skills and is
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different from counselling which is about helping people with personal concerns
such as motivation and self-confidence.
3. Mentoring- a senior manager is paired with a more junior employee for the
purpose of giving support, helping the employee learn the job, and preparing
the employee for increasing responsibility.
Mentoring actually refers to a developmental relationship between a more
experienced mentor and a less experienced partner referred to as a mentee
or protégé.
There are two types of mentoring relationships: formal and informal. Informal
relationships develop on their own between partners. Formal mentoring, on
the other hand, refers to assigned relationships, often associated with
organizational mentoring programs designed to promote employee
development.
In other cases, mentoring is used to groom up-and-coming employees
deemed to have the potential to move up into leadership roles. Here the
employee is paired with a senior level leader (or leaders) for a series of
career-coaching interactions. A similar method of high-potential mentoring is
to place the employee in a series of jobs in different areas of an organization,
all for small periods of time, in anticipation of learning the organization's
structure, culture, and methods. A mentor does not have to be a manager or
supervisor to facilitate the process.
4. Apprenticeship programs – this is the oldest training method commonly
found in industrial organisations. The apprentice works alongside and under
the supervision of a skilled supervisor for a particular duration of time. A
major part of the training time is spent on the job doing productive work and
assignments. It is used for skilled trades such as plumbing, electronics,
mechanics, iron working and carpentry.
5. Job rotation- it is also called position rotation and involves training by
periodically assigning employees to alternative jobs or tasks on some planned
basis or a rotation schedule. It may take a period ranging from four months to
two years. During this period, the trainee is supervised by a department
employee, usually a supervisor, who is responsible for orienting, training, and
evaluating the trainee. The aim is to broaden the knowledge, skills, and
outlook of trainees although it can be used to stimulate new ideas and to kill
boredom for new or experienced employees. At higher levels of the
organisation it can be used to develop managerial generalists by exposing
them to different operations.
Through job rotation, employees are prepared to assume greater
responsibility in the higher levels. Nevertheless, it can de-motivate intelligent
and aggressive employees who seek specific responsibilities. It can also
eventually produce a number of employees with limited job knowledge.
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At the senior management levels, job rotation - frequently referred to as
management rotation, is tightly linked with succession planning - developing
a pool of people capable of stepping into an existing job. Here the goal is to
provide learning experiences which facilitate changes in thinking and
perspective equivalent to the "horizon" of the level of the succession planning.
6. Understudy assignments- understudying is similar to coaching but it is a full
time mentor- understudy arrangement while coaching is only periodic. The
understudy works with the mentor on a daily basis to learn how the job is
done. In this way the understudy will be able to replace the manager during
absences caused by illnesses, retirement, study leave, transfer, promotion, or
death. The manager discusses with the understudy about problems, assigns
him or her duties, allows him or her to participate in decision-making, and
attend executive meetings on behalf of the manager. Sometimes, managers
may feel threatened by understudies and may not assist them as they should.
Further, the understudy cannot move into the position until it is vacated and he
or she may learn inappropriate skills from the supervisor.
7. Committee assignments- it is where a number of junior executives are
assigned to committees. Through discussions in the committees they get
acquainted with different viewpoints and alternative methods of problem
solving. They also learn interpersonal skills. The role of the trainer would be
to observe the proceedings, for example, the interpersonal processes,
negotiations, and successes or failures of the committees. Experienced
managers may also participate in the committees.
8. Project assignment- this is where a number of executive trainees are put
together to work on a particular project related to their functional areas. The
project team studies the problem and finds the appropriate solution.
9. Job instruction Training (JIT) - consists of 4 basic steps:
a. Preparing the trainees, by telling them about the job and overcoming their
uncertainties. Put the trainees at ease, find out what he or she knows,
arouse interest, and place the employee in the correct psychological
position. Thereafter, set up the task
b. Presenting the instructions, giving essential information in a clear manner.
Tell, show, explain, and demonstrate the operations or procedures involved
in performing the job.
c. Practice- it involves having the trainees try out the job to demonstrate their
understanding. Have them explain the steps. Give feedback on
performance. Reinforce the correct behaviour.
d. Follow up- this is placing the workers into the job on their own, with a
designated resource person to call upon should they need assistance.
Encourage questioning and check on their performance periodically.
Gradually reduce the training.
10. Multiple management- this method provides a junior board of young
executives that analyses the major problems and makes recommendations to
the Board of Directors. The young executives learn decision-making skills and
the board of directors receives the collective wisdom of the team. Vacancies
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in the senior board of directors can be filled from the junior board members,
who have received considerable exposure to the problems and issues dealt
with by the senior board of directors.
b. Off The Job Training
Off the job training is offered outside the firm. In many cases, the training is
organized to take place in an institution some distance away from the firm. The
beauty with off the job training is that it enables employees to break the
monotony of being in the organization every day. In fact, it is also an opportunity
to visit places that were not initially known.
The main methods used to conduct off the job training include the following:
1. Classroom Lectures, talks and discussions- the participants are sent to
attend formalised organised talks by instructors or experts on specific topics
useful to develop philosophy, concepts, attitudes, theories and problem
solving skills.
This is the best means for conveying specific information such as rules,
procedures, or methods. It can be supplemented with audiovisuals or
demonstrations. Feedback and active involvement of trainees must be
encouraged.
2. The conference method- it involves sending the employees to attend and
participate in professional conferences where mutual professional plans are
developed.
3. Seminar or team discussion workshops- participants are sent for seminars
or workshops in various skills or professional courses where they learn
through discussing a paper written by one of the trainees. They are also
provided with professional knowledge on various topics from expert resource
persons.
4. Vestibule school- it is a situation whereby an expert provides training in a
classroom with the help of machines and equipment identical to those in use at
the place of work. The aim is to provide specific job skills with theoretical
training taking place in the classroom and practical work being done in the
production line. Some of the organisations in Kenya that have successfully
used this approach include Kenya Ports Authority ( Bandari college), Kenya
Railways Corporation ( Railway Training Institute), Telkom Kenya ( Kenya
College Of Telecommunications Technolgy, Mbagathi), Kenya Power and
Lighting Company, and Kenya Breweries Limited.
5. Audiovisual media – films can be purchased from standard film distributors
or produced internally by the organisation, they can provide information and
explicitly demonstrate skills that are not easily presented by other techniques.
Video shows demonstrating excellent performance can also be shown.
6. Case studies- these present an in-depth description of a particular problem
that an employee might encounter on the job. The employee attempts to find
and analyse the problem, evaluate alternative courses of action, and decide
the course of action that would be most satisfactory. The purposes of a case
study are to:
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Show trainees that there is usually no easy solution to complex
organisational problems.
Demonstrate that business problems are multifaceted and they can only be
solved by borrowing from different disciplines.
Make trainees realise that different perspectives and solutions to the same
case may be equally valid.
Help managerial trainees develop their problem solving skills.
7. Role playing:
Learning takes place by letting the trainee assume the role of, say, a
salesperson. Afterwards the trainee is corrected by the trainer and by other
trainees. It is learning by acting.
8. Special training programs- certain employees may be taken for further
professional or educational studies to improve their competencies. Examples
are the undergraduate or postgraduate degrees, advanced professional
courses in Finance, marketing, human resource and so on. The same can be
done either locally or abroad depending on the organisations training policies
and availability of funds.
9. In tray exercises- the managers are given a “basketful” or assortment of
invoices, requests, memoranda, and such like data in respect to a particular
organisation, so that they can make sense of the paperwork by applying
appropriate management skills within a limited time. The aim is to find out
how someone reacts when they are under pressure and how they go about
solving the many problems that are the source of the pressure.
c. Self paced method of training.
It is also possible for employees to train themselves. This can be achieved
through studying manuals or work books, using non classroom computer based
methods, and accessing information from the internet/intranet among other
methods. This method realizes that employees learn at different rates.
4. EVALUATING THE TRAINING PROGRAM:
After a training exposure, it is necessary to evaluate the participants. The aim of
the evaluation is to determine:
Whether the program achieved its objectives or it failed
The strengths and weaknesses of the program
The cost-benefit ratio of the program
Who should participate in future training programs.
Which participants benefited most from the training.
How future programs shall be marketed.
There are many models that have been designed to explain the evaluation of
training programs. These include the works of Kirk Patricks (1994), Galvins CIPP
(1983), Brinkerhoff (1987), Kraiger, Ford, & Salas (1993), Holton (1996), and
Philips (1996).
Kirk Patrick’s model is easy to understand and to use. According to Kirkpatrick
(1994) training programs can be evaluated by measuring changes at four levels
as discussed below.
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1. Reaction level– it is the most basic level of evaluation. This level measures
how well the participants liked or disliked the training program, whether it
was worth the time and whether it was presented in a meaningful and
interesting manner. Reaction can be obtained by having the participants
complete a questionnaire or participant evaluation form. If trainees enjoyed a
programme it does not imply that the programme was very useful to the
organisation, but unpopular programmes may be cancelled due to lack of
interest. At this stage, it is not possible to establish whether the program
achieved its objectives.
2. Learning level – it measures the extent to which the trainee or participant
learnt and retained the material (i.e. the concepts, ideas, and principles) and
intellectually assimilated it. This is done by evaluating the skills or knowledge
gained at the end of the program. Alternatively the evaluation can be done on
a continuous basis by using tests or quizzes. The trainees should be informed
in advance about this assessment so as to increase their alertness and
retention. The assessment can be done by using paper and pencil tests,
performance tests and examinations.
3. Behaviourial level– ideally, training is supposed to modify the behaviour of
employees towards a given direction. At this level of evaluation, the concern
is whether the modified behaviour causes positive results such as better
reaction to customer complaints. Behaviour ratings can be collected from the
superiors, peers, subordinates, or clients of the trained employees.
4. Results – this is the ultimate value of training. It measures the extent to which
the training produces cost-related behavioural outcomes such as productivity
or quality improvements; reduction in turnover, accidents, customer
complaints, reject rates, scrappage costs, labour turnover; meeting the
production quotas; more profitability among other evaluations.
Ethical issues in training & development evaluation
Some of the ethical issues that should be considered when evaluating the training
programs include:
Confidentiality – wherever possible, steps should be taken to ensure the
confidentiality of the information collected. This can be done by using code
numbers rather than names, collecting only the necessary demographic
information, and reporting group rather than individual results among
other methods.
Informed consent- participants should be aware that they are
participating in a study. Moreover, they should know what they are
expected to do and the potential hazards and benefits of participating in
the study.
Withholding training- experimental research designs usually involve a
control group and an experimental group. Since the experiment is only
done on the experimental group, the control group may raise issues
especially where the training is believed to improve the performance of
employees leading to organizational benefits such as promotion and pay
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rises. In other cases the training could increase the physical well-being of
the employees; an example is in health related programs.
Use of deception- sometimes researchers feel that better results will be
produced when the employees don’t realize that they are in an evaluation
study, or if they are given some false or misleading information during the
study. Nevertheless the use of deception should be discouraged because it
may lead to distrust of the party that deceived the others. In situations
where deception must be used, the trainees should be informed as soon as
possible after the exercise.
Pressure to produce positive results- training and development
professionals may be under pressure to produce positive results so as to
justify their activities. There is often the possibility of doctoring results,
reporting partial results, or setting up biased studies.
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Ch. 9: MANAGEMENT DEVELOPMENT
Chapter objectives. Following the completion of this chapter, you should be able to:
Define management development and differentiate it from employee
training.
Understand the historical development of the field of management
development.
Explain the procedure involved in management development.
Discuss the importance of designing an effective management
development program.
Definition of terms: Management development is more future oriented, and more concerned with
education than employee training. Education means that management
development activities attempt to instil sound reasoning processes - to enhance
one's ability to understand and interpret knowledge. It therefore focuses more on
the employee's personal growth.
Management development is an organisation’s conscious effort to provide its
managers (and potential managers) with opportunities to learn, grow, and
change, in the hope of producing, over the long term, a cadre of managers with
the skills necessary to function effectively in that organization (Warner &
DeSimone, 2006).
Successful managers have analytical, human, conceptual and specialised skills.
They are able to think and understand problems facing the organizations that
they manage.
Management development is thus any attempt to improve current or future
managerial performance by imparting knowledge, changing attitudes, or
increasing skills.
Armstrong (2006) says that management development is the process through
which managers learn, improve their skills in their present roles and prepares
them for greater responsibilities in the future.
History of Management Development Early 1900’s
Organisations developed managers by recognizing an individual’s strong
occupational knowledge about the organisation’s products and services. The
individual was promoted to a first-level position that included work direction i.e.
telling workers what to do. Such individuals often had little training on
supervisory skills.
1950s -1980s
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Management training focused on covering certain standard topics or types of
activities in the organisation such as planning, organising, finances, sales, and so
on. There was no integrated approach to train the managers on all facets of
management concurrently.
1990s onwards
With the Human Relations movement, training programs recognised the need to
cultivate supervisory skills. Management schools or programs now cover a wide
range of management topics. They also incorporate real-world activities as part
of the training program.
Importance of Management Development
Management development contributes to the success of the organisation by
ensuring that the organisation has the managers it requires to meet its present
and future needs. Today’s managers require a wider range of skills than ever
before. These include:
Ability to manage people and systems
Ability to work in cross-cultural settings, working with teams
Being able to develop relationships, focusing on customers and building
partnerships
Being able to draw the right balance between technical and “soft” skills.
Probably the main reason for management development is that, in many
organizations, promotion from within is a major source of management talent.
Management development prepares internal managers for their new or
prospective jobs.
Management development facilitates organisational continuity by preparing
employees and current managers to smoothly assume higher-level positions. The
life of an individual is finite but organizations are assumed to have an undefined
lifespan.
It also helps to socialise management trainees by developing in them the right
values and attitudes for working in the firm. Only managers with the right
attitudes can steer an organization to greater heights.
Management development should be linked to the organisation’s strategy and
structure for accomplishing its goals. This can be done by ensuring that business
issues drive management development.
THE MANAGEMENT DEVELOPMENT PROCESS
The Management Development Process is carried out through 6 stages as shown
below.
Specify the organisation’s objectives. Objectives tell us where the organisation
is going and provides a framework from which managerial needs can be
determined. Firms set objectives in the areas of sales, profitability, return on
investments, new product development, expansion into foreign markets and
so on.
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2. Carry out an appraisal of current management resources.
The aim of assessment is to determine the existing competences of managers and
identify the gaps. This can be achieved by use performance assessment tools
such as the 360-degree appraisals.
3. Ascertaining the development activities necessary to ensure the
organisation has adequate managerial talent to fulfil future managerial needs
4. Determine individual development needs –the emphasis can be skill
development, changing attitudes, or even knowledge acquisition. Most
management development centres focus on the changing of attitudes and the
acquisition of knowledge in specific areas.
5. Assess the types of development programs that can meet these needs.
This is because no development program can be adequate for all managers.
Instead, programs must be uniquely tailored to the strengths and weaknesses of
the individual manager.
According to Flippo (1984:206) and Okumbe (2001:90), most management
programs are to enable the managers to improve on their decision-making skills,
interpersonal skills, job knowledge skills, general knowledge and specific
individual skills.
Decision making skills.
These can be improved through the use of:
In basket exercises- these are also used to train employees and involve
giving the managers a “basketful” or assortment of invoices, requests,
memoranda, and such like data in respect to a particular organisation, so that
they can make sense of the paperwork by applying appropriate management
skills within a limited time.
Business games- these are simulations in which teams of individuals compete
against each other or against an environment to achieve given objectives. The
aim is to develop the need for team work.
Case studies- from each case the trainee is required to identify the problem,
analyse the relevant issues and come up with an optimum means towards
solution of the problem.
Interpersonal skills.
Methods of improving interpersonal skills include:
Role playing- the trainee plays a part in a simulated problem situation where
he or she interacts with others who may be subordinates or co-ordinates.
Behaviour modelling- it is observing the behaviours of other successful
managers and emulating it.
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Sensitivity training- the basic goal of sensitivity training is to increase
managerial sensitivity and respect for others and their contributions no matter
their positions.
Job knowledge skills.
Job knowledge can be acquired through on the job experience, coaching or
understudies.
Organisational knowledge
This is improved through the use of position rotation and multiple management
General knowledge skills. This knowledge is acquired from educational organisations through exposure to
special courses, special meetings and selective reading assignments. An example is requiring the trainees to read the concepts of organisation
development and the balanced scorecard as proposed by Kaplan and Norton
(1996).
Management development programs can also be classified as work- based,
education and training, as well as the e-learning approaches.
Work-based methods These include Coaching, mentoring, and job rotation. Other work based methods
include
a) Action learning
Most people learn best by doing. It is therefore better if that process can be
structured. Action learning programs help to achieve this by making trainees
focus on solving live issues in their normal working environments by trying out
different approaches, with discussion and support from colleagues to help them
reflect on their impact.
b) Project working
This involves getting managers to work in cross-functional teams, exposing them
to different functions and enabling them to learn about different aspects of the
organization and ways of doing things. Putting people on such teams is one way
of broadening their experience and effectiveness.
c) Secondments
Taking a role in another organization through secondments for a year or two - or
sometimes, in the case of senior people, non-executive directorships - is another
way of broadening experience.
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d) Competency-based
This uses competency frameworks as a means of identifying and expressing
development needs and pointing the way to self-managed learning programmes
or the provision of learning opportunities by the organisation.
Using this approach, management development may choose to focus on a limited
number of core organisational competences.
e) Development centres
Such centres help participants build up an awareness of the competences their
job requires and to construct their own personal development plans to improve
their performance in the present job and to enhance their careers.
Development centres focus on the competencies needed in the future. They are
not a physical location. Participants are put in a position of practising behaviour
in conditions very similar to those they will meet in the course of their everyday
work. An important part of the centre’s activities will be feedback reviews,
counselling and coaching sessions.
Education and training
(a) Formal training courses
Formal training is given in the shape of courses, particularly at key transition
points such as first management jobs and as preludes to promotion. Their content
will vary according to the organization and the role the individual is to fill, but in
the private sector, finance and business strategy is a key component. Change
management appears to be increasingly popular.
These courses are increasingly being delivered in the form of modules, with
work-based projects and maybe coaching and mentoring in between.
Outdoor development is sometimes used for team building purposes, while in-
house providers or external deliverers can provide 'one-off' training to fill
particular gaps which might be identified because of organisational needs or
through the review and one-to-one processes mentioned above. An important
aspect of getting people together away from the workplace is that they can
exchange ideas outside the classroom, while meeting people from elsewhere in
the organisation helps in corporate networking.
(b) Executive Education
This is often offered at graduate-level business schools that aim to give classes for
chief executives and other top managers and entrepreneurs. These programs do
not usually end in a degree, although there is an ever-growing number of
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Executive MBA programs that are very similar and offer a Master of Business
Administration upon completion of the coursework.
E-learning and blended learning
Organisations are seeking to supplement traditional courses by e-learning, which
is the use of computers to deliver training, often delivered through corporate
intranets. It provides large populations with the same material, and access is
flexible so that people can learn in their own time.
6. Evaluate the management development program:
Look for changes in behaviour and managerial performance.
3.0. DESIGNING AN EFFECTIVE MANAGEMENT DEVELOPMENT
PROGRAM
In designing an effective management development program, the following
guidelines are recommended.
1. Define the purpose of the program and behaviours to be developed.
A management development program should be able to demonstrate how it
will meet or contribute to organisational objectives.
2. Find and use organisational support for creating a process not an event.
Activities that lack the support of the total organization, especially the top
management, may not succeed.
3. The program should be designed to ensure that the individuals to be
developed are motivated to participate in the activities of the program.
4. Provide feedback on effectiveness of program as well as the progress of the
managers.
It is important to evaluate learning in order to assess its effectiveness in
producing the outcomes specified and/or indicate where improvements or
changes are required to make the training even more effective.
REFERENCES
1. ARMSTRONG, M.(2006) A Handbook of Human Resource Management Practice
10th Ed. Kogan Page, London
2. BERNTHAL, P.R. and WELLINS, R.S. (2005) UK global comparisons leadership
forecast 2005-2006: best practices for tomorrow's global leaders. Survey report.
London: Chartered Institute of Personnel and Development.
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3. DESSLER, G.(2004) Human Resource Management 10th Ed. Prentice Hall
4. WERNER, J.M. and DESIMONE, R.L. (2006) Human Resource Development 4th
Ed. Thomson South-Western, US
5. http://www.managementhelp.org/mgmt_dev/ Management Development
Planning
6. http://en.wikipedia.org/wiki/Management_development
CH. 10: CAREER MANAGEMENT AND
DEVELOPMENT
Chapter objectives.
After reading this chapter, it is expected that the reader will be able to:
Explain the concept of career management and development from a
historical perspective.
Define concepts related to careers
Discuss models that relate careers to the stages of human life.
Explain the role of individuals and managers in managing careers.
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INTRODUCTION Many people in different fields including educators, psychologists, sociologists,
economists and management scholars are all trying to understand how people
select and work within certain careers.
Most people spend a lot of time working, and the career choices they make will
determine to a large degree their success, happiness, and financial well-being.
Human Resource Development (HRD) managers should therefore understand
how employees make career choices. It is also wise to find ways to influence the
careers of their employees. By so doing, the human resource managers will do a
better job of human resource planning and preparing employees for longer term
responsibilities.
A Historical perspective. Traditionally people were not future oriented and they believed if they joined an
organisation, worked hard and stayed out of trouble they would have the job as
long as they wanted. This can also be called the “entitlement mentality” towards
jobs where the employer owed the employee benefits and all the other things
that go with work. The employee would then have to be loyal to the employer.
Career development was seen as the concern of the employer so as to train and
develop managers for the future. For many years, the demand for skilled
employees was greater than their supply. Consequently, life time or long term
employment was the order of the day.
Since the 1980s the business environment has been turbulent. Geographical
boundaries no longer limit the operations of multinational or global firms.
External trade liberalization has exposed firms to greater competition. This has
forced organizations to respond through business practices such as downsizing,
shrinking hierarchies, cost cutting, outsourcing, mergers and acquisitions,
technological innovations and more performance-oriented HRD programs. The
employment relationship is now an exchange relationship for the mutual benefit
of both parties; the employees have the primary responsibility of developing
themselves in order to remain employable. Consequently, the new relationship is
one in which there is no assurance of long term employment.
Nowadays, employees are now expected to assume responsibility for developing
and maintaining their own skills, add demonstrable value to the organisation and
to understand the nature of their employer’s business.
Employers on the other hand are expected to provide opportunities for skill
development, training, and education. They are also expected to involve the
employees in making decisions concerning their careers and performance based
compensation.
DEFINING CAREER CONCEPTS
The word career means many things to many people. It also has different
meaning among researchers. When used in the property of an occupation or
organisations it describes the occupation itself. When used for advancement it
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denotes one’s progression and increasing success within an occupation or
organisation.
Definition of Career
A career is the pattern of work-related experiences that span the course of a
person’s life (Werner & Desimone, 2006). An example is the movement from an
accounts assistant to an accountant, then a senior accountant and then to a
financial manager before becoming the chief executive officer.
A career can also be defined as the occupational position a person has had over
many years. It is also the individually perceived sequence of attitudes and
behaviours associated with work-related activities and experiences over the span
of a person’s life (Bernadin, 2003).
Examples of careers are medicine, banking, teaching, military and plumbing.
Careers can determine where one lives, the kind of friends one makes, the
amount of money one earns, how one feels about themselves, and the way others
behave towards the person.
Career Development
It is important to understand how careers develop over the life time of an
individual. This is because there seems to be a relationship between the stages of
an individual’s life and the career choices that have to be made. Thus career
development refers to an ongoing process by which individuals progress through
a series of stages, each of which is characterised by a relatively unique set of
issues, themes and tasks (Greanhaus et al. 2000).
Career development comprises of career planning and career management
(Storey, 1996).
Career planning is a deliberate process of becoming aware of self, opportunities,
constraints, choices and consequences; identifying career-related goals; and
programming work, education and related developmental experiences to
provide the direction, timing and sequence of steps to attain a specific career
goal.
Dessler (2005) describes career planning as a deliberate process through which
one becomes aware of personal skills, interests, knowledge, motivations and
other characteristics; acquires information about opportunities and choices;
identifies career-related goals; and establishes action plans to attain specific
goals. Bernadin (2003) says that career planning is a deliberate attempt by an
individual to become more aware of his or her own skills, interests, values,
opportunities, constraints, choices and consequences; identifying career-related
goals and establishing plans for achieving those goals.1
Career management is a process for enabling employees to better understand
and develop their career skills and interests and to use these skills and interests
1 Bernardin, H. J., (2003), Human Resource Management: an experiential approach, 3
rd Ed. Pg 194
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most effectively both within the company and after they leave the firm. It is also
an organisational process that involves preparing, implementing and monitoring
career plans undertaken by an individual alone or within the organisation’s
career systems.2
4.0 STAGES OF LIFE AND CAREER DEVELOPMENT
There are many theories that explain how careers develop. Some of the popular
ones are:
Erick Erickson’s model
Daniel Levinsons ERAS approach to adult development.
John Hollands’ theory of vocational choice
Donald Super’s theory of career development.
Erikson’s Model
Erikson proposed that people progress through eight (8) stages during the
course of their life. In each stage model a person is faced with a challenge that
he or she must resolve in order to develop. The stages and accompanying age
ranges are shown below.
Stage of Development (issue) Age Range (years)
1. basic trust vs. mistrust infancy
2. autonomy vs. shame and doubt 1-3
3. initiative vs. guilt 4-5
4. industry vs. infirmity 6-11
5. identity vs. role confusion puberty and adolescent
6. intimacy vs. isolation young adulthood
7. generativity vs. stagnation middle adulthood
8. ego integrity vs. despair maturity
Erickson says that each stage has a challenge to be overcome. Where the
challenge is overcome, the individual enters the next stage with a clear vision;
otherwise they enter the next stage with confusion.
An infant who is below one year may have the challenge of trusting or not
trusting other people. Although the infant may not express themselves
verbally, he or she may cry as a sign of distrust.
An adolescent may have the conflict between identity and role confusion. If
individuals successfully resolve this issue, they will enter adulthood with a
clear sense of who they are in relation to others in the world. If they do not
successfully resolve this issue, they will enter adulthood with confusion over
who they are and what their role in the world is to be. A young adult may be
faced with the challenge of developing meaningful relations with others or
intimacy. If the individual successfully resolves this stage he/she will be able
to make a commitment to other individuals and groups; otherwise the
individual is likely to experience feelings of isolation.
2 Bernardin, H. J., (2003), Human Resource Management: an experiential approach, 3
rd Ed. Pg 194
88
In middle adulthood, the challenge is to develop the capacity to focus on the
generations that will follow i.e.generativity. This takes the form of becoming
more involved in the lives of children, social issues affecting future generations or
serving as mentor for young colleagues
The ego integrity stage involves developing, understanding and accepting the
choices one has made in life. This can lead to being at peace with one’s life as
one faces death otherwise one can experience despair over the meaningless of
one’s existence.
It should be known that organisations often serve as places where individuals can
resolve some of these challenges. Human resource managers should assist the
employees to overcome the challenges. An example would be providing pre-
retirement counselling.
Levinsons “Eras’ Approach to Adult Development
Levinson and his colleagues argue that there is an underlying order of life
development called seasons or life cycle or ERAS. These ERAS are:
pre-adulthood (0-22years)
Early adulthood (17- 45 years)
Middle adulthood ( 40- 65 year)
Late adulthood (60 year and above)
The transitional periods are known as cross-era transitions and may last up to five
years.
Pre –Adulthood (0- 22 years)
This is where individuals work to develop a sense of who they are. It is a self
identification stage.
Early Adulthood (ages 17 – 45)
This is a period of great energy and great stress. This is the era where the person
is at a biological peak and is striving to attain the goals and desires of youth
which include finding a place in society, obtaining meaningful work, realizing a
lifestyle, establishing meaningful relations (marriage) and raising a family. It is at
this stage that many people experience occupational advancement. The most
meaningful age is age 30 which is a critical age of questioning and re-appraisal
the “Dream” that one has been pursuing in life.
Middle adulthood (ages 40-65)
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At this stage a person’s life changes significantly between early and middle
adulthood. There is a major questioning of the life structure (goals, ambitions)
and the “Dream” that was vigorously pursued in early adulthood.
The answers to questions such as “What have I done with my life?”, “What is it I
want to accomplish before I die?”, “What do I want to leave behind for my
family?” can lead one to accept themselves or to become bitter and stagnate.
Late adulthood (age 60 – Death)
The individual faces further major life challenges such as declining health,
retirement, loss of family and loved ones. The major challenge of this stage is to
come to terms with ones life and accept things as they are instead of dwelling on
what might have been.
The above models are an oversimplification of reality but they reflect, to a certain
degree, an individual’s developmental stages throughout ones career life.
JOHN HOLLAND’S THEORY OF VOCATIONAL CHOICE
This theory proposes that people are motivated to find occupational
environments consistent with their personalities. Thus vocational satisfaction,
stability, and achievement depend on the congruence between one's personality
and the environment in which one works. Congruence is defined as the relative
proximity between the client's personality and his or her occupational
environment.
According to this theory, both personality and environment are grouped into six
major categories: Realistic (R), Investigative (I), Artistic (A), Social (S),
Enterprising (E), and Conventional (C) as shown in the diagram below.
Diag.1. Holland’s six personality types
Thus an individual will be comfortable with those careers that are in line with
their personality. A person whose personality is investigative would be happy
with careers such as criminal investigations.
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SUPER’S THEORY OF CAREER DEVELOPMENT
Super describes life’s stages of development as growth, exploration,
establishment, maintenance, and decline.
The growth stage represents psychological as well as physical growth. During
this stage, self-concept is developed while experiences simultaneously provide
knowledge of the world of work.
The exploratory stage begins with a fantasy period where an individual realizes
that an occupation will be a part of one's life even though the desired occupation
is often unrealistic. During this tentative phase, the individual chooses several
possibilities and then the number of alternatives is gradually reduced to include
goals that the individual feels can be reached and in which opportunities exist.
During the establishment stage, the individual tries to discover whether or not
choices and decisions made during the exploratory stage are realistic. This
period involves "trying on" a job. The person may actually get into the desired
career and evaluate their capabilities and suitability for the job.
The maintenance phase involves adjustment and improvement while the pre-
retirement period occurs in the decline phase during which the individual's
emphasis is on retaining the job rather than enhancing it. The period ends when
the individual leaves the workforce.
CAREER MANAGEMENT
These are the activities individuals and organisation use to actively manage the
careers of employees. It involves planning for career activities and putting those
plans into action.
Career management for individuals involves the following activities.
Career exploration- This Involves gathering information about one’s self and the
environment.
Awareness of self and environment- An individual will understand both
opportunities and constraints present in the environment. This will lead
individuals to set or revise career goals or strategy development.
Goal setting- This is a specific and realistic statement of the career goals that a
person may wish to pursue. It is based on an awareness of self and the
environment.
Strategy development- This is an action plan for accomplishing the career goal.
It includes actions that should be carried out and a timetable for performing them.
Strategy implementation- This involves carrying out the strategy the individual
has developed. It is easier to get where you are going if you have a plan.
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Progress towards the goal- it is the e extend to which the individual is nearing
the career goal.
Feedback from work and non-work sources- This is valuable information about
the progress towards the career goal.
Career appraisal-Feedback and information progress towards the career goal
permit the individual to appraise his/her career. Appraisal leads to re-
arrangement in career exploration and career management process.
ROLES IN CAREER DEVELOPMENT
There are three roles in career development namely:-
8.1 The Individual’s role
A person bears the primary responsibility of his/her own career. The best way to
approach career managements through careful information gathering, planning
and goal setting, decision making, action and follow-up. Individuals should make
decision and take assignments that provide them with opportunity to learn and
continuously develop news and existing skills.
An individual can develop himself or herself through:
Consulting mentors, coaches etc
Taking a study leave
Enrolling for part-time classes or by correspondence
Observing and interacting with others who form success stories.
8.2 Managers Responsibility
There are several roles that managers and supervisor can perform in order to
fulfil their responsibility as career developers. These include the following:-
Provide timely performance feedback
Provide development assignments and support
Participate in career development discussions with employees so to know
the employees career goals and how to achieve them.
Support employee development plans
Asking employees to be mentors to other staff members.
Allocate time and money for classes, training and workshops.
REFERENCES
Werner, M. J. & Randy, L. D., (2006), Human Resource Development, 4th Edition,
Thomson Corporation, United Kingdom.
Dessler G., (2005) Human Resource Management, Pearson Education Inc.,
Upper Saddle River, New Jersey, United States of America.
92
Bernardin, H. J., (2003), Human Resource Management: an experiential
approach, 3rd Edition, McGraw-Hill/Irwin, New York, United States of America.
A document written by Carter Mac Namara MBA PhD
www.managementhelp.ort/mggt-development/history
The Adult Development of Career Army Officer
http://Amazon.com
www.Careers.state.gov/civil-service/department
Benefits of career management and Development a document of the University of
Liverpool, http://findarticles.com/p/articles/mi
CH. 11: JOB ANALYSIS
Chapter objectives. This chapter contains information that will enable the reader to:
Explain the importance of job analysis.
Understand the main methods used to undertake job analysis.
Examine and analyse the contents of the job analysis exercise.
Introduction. Before an individual can be hired to perform a job, the requirements of that job
must be identified. Before the level of pay for a job can be established, the
qualifications required in performing the job must be determined. Similarly
before the performance of an employee can be evaluated or a decision can be
made as to whether or not an employee is doing what he/she should be doing,
then what the employee should be doing must be identified. Therefore, before
any of these human resource functions can be performed, there must a thorough
understanding of the domain of the job. To do this, human resource professional
use a job analysis, which is a means of collecting information about various
aspects of a job.
Results from a job analysis serve as the foundation for many of the human
resource function including selection, compensation, performance evaluation,
and training.
Definition of terms
1. JOB – this is defined as a collection or aggregation of tasks, duties, and
responsibilities that, as a whole, are regarded as the reasonable assignment to
an individual employee. Consider the job of a driver
2. POSITION - This refers to one or more duties performed by one person
in an organisation. There are at least as many positions as there are workers in
the organisation; vacancies may create more positions.
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3. TASK – it is a distinct work activity carried out for a distinct purpose.
Examples are typing a letter, preparing a lecture, making a sales call.
4. DUTY - A duty is a number of tasks that are done by a job holder. The duty of
an accountant may include preparing monthly payments for the employees.
5. JOB ELEMENT - this is the smallest unit into which work can be divided.
Signing a document is an example of a job element in the job of the General
Manager.
6. OCCUPATION - This is a job that is common to many firms and areas.
Electricians and accountants are examples of occupations.
7. JOB FAMILIES OR OCCUPATIONAL FAMILIES - These are groups of jobs
or occupations having similar personnel requirements .Marketing executives
and customer service executives are in a job family.
8. A CAREER - It represents a sequence of positions, jobs, or occupations that a
person has over his/her working life.
9. JOB ANALYSIS- It is a systematic exploration of the activities within a job.
This analysis involves compiling a detailed description of tasks, determining
the relationships of the job to technology and to other jobs and examining the
knowledge, qualifications or employment standards, accountabilities and
other incumbent requirement.
The job analysis indicates what activities and accountabilities the job entails; it is
an accurate recording of the activities involved.
The Job Analysis involves studying jobs to determine what tasks and responsibilities
they include, their relationships to other jobs, and the conditions under which work
is performed, and the personal capabilities required for satisfactory performance.
It is sometimes called "Job Study' suggesting the care with which tasks,
processes, responsibilities, and personal requirements are investigated.
Purpose of A Job Analysis
Although the Job Analysis is an essential foundation for staffing, it may be used for
many other purposes such as:
1. Determining qualifications required of jobholders
2. Providing guidance in recruitment and selection
3. Evaluating current employees for transfer or promotion
4. Establishing requirements for training programs
5. Setting wage and salary levels and maintaining fairness in wage and salary
administration
6. Judging the merits of grievances that question assignments and
compensation
7. Establishing responsibility, accountability, and authority
8. Providing essential guides in the establishment of productions standards
9. Providing clues for work simplification and methods improvement
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Job Analysis is the study of jobs within an organisation so as to determine the
activities employees perform, the tools and equipment used. It also looks at the
working conditions under which the activities are performed and the minimum
required qualifications one should possess to adequately perform a given job.
Steps in Conducting a Job Analysis
1. Determine the purpose for conducting a Job Analysis
2. Identify the job to be analysed
3. Explain the process to employees and determine their level of involvement
4. Determine the data collection method and collect job analysis information
5. Process the Job Analysis information
6. Review and update frequently
Areas of Job Information
Job Analysis seeks to find a lot of information about a job. The exact type and
scope of information procured will depend on both the intended use of the Job
analysis information and the time and budget constraints imposed on the
organisation.
The Job Analysis study seeks to provide information in 7 major areas:
1. The job identification - its title
2. Distinctive or significant characteristics of the job - its location; physical
setting; supervision; union jurisdiction, if any; hazards and discomforts
3. What the typical workers does - specific operations and tasks that make up the
assignment; their relative timing and importance; the simplicity, routine, or
complexity of tasks; responsibilities for others, property, or for funds
4. What materials and equipment the worker uses- metals, plastics, grain, yarns,
or lathes, milling machines, etc.
5. How the job is performed - emphasis here is on the nature of operations and
may specify such operations as handling, feeding, removing, drilling, driving,
setting up and many others
6. Required personal attributes - experience, apprenticeship, physical strength,
co-ordination or dexterity, physical demands, mental capabilities, aptitudes,
social skills etc.
7. Job relationships - experience required, opportunities for advancement,
patterns of promotion to and from, essential co-operation, directions or
leadership from and other jobs, usual sources of employees
When Job Analysis is Carried Out
A Job Analysis can be conducted at 3 different times:
1. When an organisation is started
2. When changes occur which require new methods and procedures in
performing the job. An example would be when new technology is introduced
into the organization.
3. When a new job is created
The information provided by the Job Analysis process is written into the record in
the form of job descriptions and job specifications.
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JOB DESCRIPTION
It provides information on the duties and responsibilities of a particular job.
Included in the information are accurate and concise statements, which show
what the jobholder will do, how the jobholder will perform, the conditions under
which the activities will be performed, standards and time required in
performing the activities.
Contents of a job description:
1. Major duties to be performed
2. Percentage of time to be devoted to each duty
3. Performance standards to be achieved
4. Working conditions and potential health hazards
5. Supervisory responsibilities, if any
6. Number of persons required to work on the same job
7. Reporting relationships-who reports to who and how many people report to
one position
8. The tools used to perform the job e.g. machines and equipment
A job description requires periodic, systematic information gathering and
review. It should be in line with the organisation’s objectives and mission.
Job descriptions are used during recruitment, induction of new employees, when
deciding who should be promoted/demoted/transferred, and performance
appraisals; they are also useful in making decisions related to training and
development, discipline of the workers and compensation administration.
JOB SPECIFICATION
It identifies the minimum acceptable qualifications that a jobholder should
possess to perform a given job adequately with minimum supervision i.e.
experience, training, education (primary, secondary or university), knowledge,
skills or abilities.
The information needed required to accomplish a job analysis include:
1. Employee oriented activities,
2. Job demands
3. The form of communication patterns
4. Knowledge of type of tools
5. Machines and equipment
6. Job related tangibles and intangibles as well as standards
METHODS OF JOB ANALYSIS
Since organisations are different, the method used is based on the goals the
information will serve and the suitability of the method to the organisation.
The data for job analysis must be collected from people who are directly or
indirectly involved with the job using any of the following methods:
1. Observations An individual at work can be observed to record a brief description of the
activities performed, how they are performed, and the time taken to perform
each activity.
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However, when an individual is aware that he or she is being observed or
recorded s/he behaves differently from normal. Therefore, efforts should be
made to make sure that individuals who are likely to behave differently from
normal are not aware that they are being observed.
This method is most suitable where physical skills are required but is limited
where mental skills are required.
2. Questionnaires It involves administering a structured questionnaire to employees so that one can
identify the activities they perform in accomplishing their jobs. The questionnaire
must capture the job title, reporting relationships, purpose of the job, and the
main tasks and duties.
3. Interviews
Sometimes a good understanding of the activities involved can be obtained by
talking to the employee and to their immediate supervisor to confirm whether
both view the job in the same perspective. Interviewing can be a rather time
consuming and costly method of data collection especially where many
employees are involved because the interviewers must be trained to perform the
interviews. Nevertheless, interviews are flexible and they can avail very
important information from the employees.
3. Employee Recordings
The employees can be told to maintain written records of what they do and how
they do it on a daily basis. The activities should be recorded in order of priority
immediately after they have occurred including any specific problems or
weaknesses encountered.
4. Functional job analysis
This is a worker-oriented method of describing jobs, which defines what a person
actually does rather than for what he is responsible. It concentrates on the
interactions among the work, the worker and the work organisation. Ideally, the
concern is on the proportional involvement of the job on data, people and things.
Jobs involve various measures of these variables.
5. Position analysis questionnaire
This questionnaire analyses a job in terms of information input, mental processes,
work output, and relationships/interactions with other workers
Each factor is then evaluated on a specified scale such as extent of use.
Afterwards, it would be possible to rank the jobs in relation to these variables.
6. Management position description questionnaire
This questionnaire is designed for management positions and uses a checklist
method to analyse the job of a manager. The job of many managers has elements
of product, market and financial planning; co-ordination of other organisational
units and human resources; internal business control; products and services
responsibility; and public and customer relations among others.
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These factors can be used to determine training needs of those individuals who
are about to move into managerial positions as well as for setting compensation
rates for managerial positions.
JOB DESIGN
This is the process of determining how specific tasks are combined to form
complete jobs. It also establishes how a particular job relates to other jobs or
work in an organisation.
Due to changes in the nature of organisations, economic and technological
factors, jobs have to be redesigned. Two approaches used in job redesign are
job enlargement and job enrichment
Job Enlargement involves expanding a particular job's content horizontally so as
to create a wider variety of duties for the jobholder and so as to reduce boredom.
Since the increased duties and responsibilities are not accompanied by
corresponding benefits (e.g. increased pay or other fringe benefits) it can affect
the employee’s morale negatively.
Job Enrichment involves expanding a job vertically i.e. the jobholder is given
greater control over his work, more independence and responsibility. This is
actually promotion since it increases the corresponding compensation and
authority.
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Ch.12 Job evaluation Chapter objectives After reading this chapter, the reader will be expected to be able to:
Define job evaluation
Explain the importance of job evaluation
Discuss the systematic process of conducting job evaluation including the
relevant methods.
INTRODUCTION
Definition of job evaluation.
Job evaluation can be defined as a systematic procedure designed to aid in
establishing pay differentials among jobs.
It is also a systematic process of defining the relative worth or size of jobs within
an organization in order to establish internal relativities ( Armstrong, 2006).
The aim of job evaluation is to provide a systematic and consistent approach to
defining the relative worth of jobs within a work place, single plant or multiple
size organizations. It is a process whereby jobs are placed in a rank according to
overall demands placed upon the job holder. It therefore provides a basis for a
fair and orderly grading structure.
A job evaluation system is composed of compensable factors and a weighting
scheme based on the importance of each compensable factor to the organization.
A compensable factor is a job characteristic that the organization values and
chooses to pay for. These characteristics include job characteristics may include
job complexity, working conditions, required education, required experience,
and responsibility.
Job evaluation does not determine actual pay. That is a separate operation,
normally the subject of negotiation between management and employees or their
trade union representatives. In addition, only the job is evaluated, not the person
doing it. It is a technique of job analysis, assessment and comparison and it is
concerned with the demands of the job, such as the experience and the
responsibility required to carryout the job.
Furthermore, it is not concerned with the total volume of work, the number of
people required to it, the scheduling of work, or the ability of the job holder.
Moreover, techniques of job evaluation have developed, varying in approach.
Some involve an examination of jobs according to criteria such as skill,
responsibility and working conditions. Others are less complex. Methods of job
evaluation discussed in this chapter include ranking, classification, point plan
factor comparison and Hay system among others.
Scholars of global human resource management may need to understand the
legal considerations of job evaluation. Legal consideration could include aspects
such as :
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The right to equal pay
Employees that operate dangerous equipment
Executives and specialists of transport companies, among others.
1.1 PURPOSES/IMPOTANCE OF JOB EVALUATION
Purpose
The purpose of job evaluation is to identify and determine in detail the particular
duties, requirements and the relative importance of these duties for a given job.
It is a process where judgments are made about data collected on a job, not a
description of the person.
Job evaluation is designed as the methods and practices of ordering jobs or
positioning with respect to their value or worth to the organization and applying
the appropriate remuneration accordingly.
These practical courses allow one to establish and document the relatedness of
employment procedures such as training, selection and compensation. A firm’s
management will then be able to evaluate what might work in their organization
and also have an opportunity to examine the direction that job analysis and
evaluation are moving in and their role in the future.
Importance
Job evaluation can be beneficial when the existing grading
system/structure in an organization is in need of review.
Job evaluation helps or maintains the credibility and acceptability of a
grading system.
Job evaluation facilitates the accommodation of new or revised jobs into
the grading structure.
Job evaluation can be used by organizations as a basis for job matching
and external pay comparisons.
It ensures the organization meets equal pay for work of equal value
obligations.
Methods of Job Evaluation
The major methods of job evaluation include the following.
Job ranking
Job classification
Factor comparison
Point factor evaluations
Proprietary brands
Market pricing
Internal benchmarking
Analytical matching.
Ranking
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Ranking simply orders the job done in the organization from the smallest to
largest based on the evaluator’s perception of relative value or contribution to an
organization’s success. Jobs are compared with each other and arranged
according to their perceived size or value to the organization. The comparison
may be based on a single factor such as the level of responsibility.
Moreover, ranking method is suitable and only workable for small organizations,
with very few different jobs. The ranking is based on the whole job and the jobs
are not broken down into factors or elements. The method is simple and easy to
implement, less costly to the organization and requires little training.
Job classification or pay grades.
Job descriptions are slotted into a series of classes that cover the range of jobs.
Each class has a description of the characteristics such as the skill, decision
making and responsibility that relate to jobs in that category. It is used a lot for
public service jobs. The class descriptions are the standards against which the
jobs are compared.
Job classification is a very common job evaluation method which involves slotting
jobs into the pre-described grades. For each job grade, there is the minimum,
midpoint and maximum pay. As long as the grades exist, there is less difficult in
setting the pay for employees. The disadvantage with using grades is that some
jobs will be underpaid while others are overpaid.
Just like ranking, grading is simple to administer, cheap to the organization, and
requires little training. However, the grades are general and abstract, and
compensable factors are not clearly defined.
Factor Comparison
This is a very complex method of job evaluation. Nevertheless, it can perpetuate
equity because it takes into consideration what is happening in the market.
The factor comparison method involves comparing jobs against other jobs on the
basis of how much of some desired factor they possess. Each job’s factors are
ranked against each other job’s factors. Finally, the market pay rate for each job
is then allocated among the factors based upon a market pay rate scale.
Some of the factors considered include the level of responsibility, the risks
involved in the job, amount of decision making involved and the number of
subordinates supervised.
Point- factor method
This method involves breaking down jobs into factors or key elements
representing the demands made by the job on the job holders, the competences
required, and the impact made by the job.
The point factor method addresses three major aspects namely:
defining the compensable elements
Assigning a numerical scale of the factor degrees.
Assigning weights to the factors which reflect the relative importance of
each factor.
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Compensable elements are these characteristics in the job (not the position) that
the organization values and will help it to pursue its strategy and achieve its
objectives. Some of the compensable factors include job knowledge, problem
solving abilities and accountability.
Proprietary brands These are job evaluation methods offered by management consultants. Perhaps,
the most common method here is the Hay Guide Chart which in essence is an
administrative, professional and technical job evaluation method.
Using the Hay System, jobs are evaluated as follows.
Job description questionnaires are completed and signed by the
jobholder, the supervisor and other managerial staff who have
responsibility for the position.
The job description questionnaire is given to each member of the job
evaluation committee for his/her initial evaluation.
The committee meets with the jobholders and supervisors to explore
questions and clarify content.
The committee members then compare their individual evaluations and
resolve differences that might exist.
The hay system considers three major variables in job evaluation. These are
know-how, problem solving and accountability.
Know –how is the sum total of every kind of skill, however acquired, needed for
acceptable job performance. Know-how involves integrating and harmonizing
the diversified functions involved in managerial situations (operating, supporting
and administrative). This know-how may be exercised consultatively as well as
executively and involves in some combination the areas of organizing, planning,
executing, controlling and evaluating.
Problem solving is the original “self starting” thinking required by the job in
analyzing, evaluating, creating, reasoning, arriving at and making conclusions.
Accountability is the answerability for an action and for the consequences
thereof; it is the measured effect of the job on end results.
Conclusion
Job evaluation will involve change even though the change may only affect same
jobs. Commitment to change will be essential, with both management and
employee representatives agreeing from the outset that they will act upon the
results.
Job evaluation may result on same existing employee’s jobs being placed in a
lower grade which does not equate with other current pay-rate.
It is recommended that a policy on how to deal with such situations be considered
and, if possible, agreement reached before embarking on job evaluation.
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References:
http://www.ares.org.uk/publications/BOI.html
http://www.petersburrycitg.com/business/expert/staff/
http://www4semo.edu/human resources/jobeval/hay,ppt
Ch. 12: COMPENSATION OF EMPLOYEES
AND MANAGERS
Chapter objectives The objectives of this chapter are to:
Understand the components of a compensation system.
Distinguish executive compensation from the compensation of ordinary
employees.
Understand the factors that should be considered when designing
compensation systems.
Appreciate the role of compensation policies.
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Introduction
Employees exchange their inputs (physical and mental work behaviour) for
outputs (rewards). The employees use the rewards to satisfy their needs. Human
beings have many needs ranging form the most basic (i.e. physiological needs
for food, water and clothing), to safety, social, esteem, and self-actualisation
needs. Employers can use rewards to shape the behaviour of employees in the
workplace. Wages can provide a source of motivation for employees to perform
effectively.
Money is probably the most important reward. The perplexing question to
employers is how much employees should be paid.
The goals of compensation administration are to design the lowest - cost pay
structure that will attract, motivate, and retain competent employees, and that
also will be perceived as fair by employees. The compensation should be fair to
the organisation and to the employees.
Organisations generally seek to pay the least that they have to in order to
minimise costs so fairness means a wage or salary that is adequate for the
demands and requirements for the job. Indeed, employee remuneration is often
the single largest cost item to an organisation. The total cost of the overall
remuneration and reward system can have a decisive bearing on an
organisation’s competitive position; effective management of cost, nature and
distribution of rewards therefore demand careful attention.
The employees perceive fairness in terms of the input-out come ratio. Where the
employees perceive an imbalance in this ratio, they may seek to change the
status quo. Strategies for changing the status quo include looking for other jobs,
working for fewer hours, negative word of mouth advertising, and misuse of
company assets.
Employees also compare what they earn with what their counterparts in other
organizations earn. This is according to the equity theory. The comparison can
reveal that the employee is paid better, at the same level, or worse than
employees in other organizations. Perceptions of inequity will make the
employee dissatisfied with the current employer.
Remuneration may be defined as the financial and non financial extrinsic rewards
provided by an employer for the time, skills and effort made available by the
employee in fulfilling job requirements aimed at achieving organisational
objectives (Swanepoel et al 2000:526).
Words commonly used for remuneration include reward management,
remuneration management, salary and wage administration or pay
administration.
Rewards can be classified either as intrinsic or extrinsic. The intrinsic rewards
include:
More responsibility
Opportunities for personal growth
Participation in decision making
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More interesting work
Below is a summary of the extrinsic rewards.
Table : Extrinsic rewards.
Performance
related
Membership
related
Status rewards Social rewards
Commission
Basic salary Location of office praise
Performance
bonuses
Retirement
benefits
Office Friendly
greetings
Merit pay Car allowance Office furnishings Friendly
greetings
Incentive
schemes
Medical aid Assigned parking Dinner invitation
Achievement
awards
Subsidised
canteen
Own secretary Pat on the back
Stock ownership Vacation
Public
recognition
Social gatherings
Profit sharing
COMPENSATION POLICIES
Firms should formulate compensation policies. Specific issues to be included in
the policy include the following:
Pay level- the policy should state whether the pay level will be above, below,
or the same as the prevailing market rate.
Equity-it should be stated how the organisation would strive to achieve
equity in its remuneration.
Performance related rewards- this is the question of how achievement
would be rewarded and the role incentives and bonus schemes would play.
Market rate policy-here one states the extent to which market rate pressures
should be allowed to affect or possibly distort the salary structure.
Control- a policy statement in this regard answers the question of how much
freedom is given to individual managers to influence the salaries of their staff.
Communication- how much information about remuneration should be made
freely available to employees and their representatives and what degree of
pay secrecy should be enforced
The minimum level at which new employees should be engaged needs also
to be stated.
Pay differential/intervals within a job grade and between consecutive job
grades should be reflected.
The extent to which individuals/groups can negotiate their pay and
allowances within the established rates is also supposed to be covered.
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The rate and intervals at which pay rises can be granted forms part of the
policy. The pay increases can be fixed or variable amounts and can be
granted at a variable interval or fixed intervals.
Flexibility of the pay structure due to environmental changes is also to be
included.
TYPES OF COMPENSATION:
There are 3 forms of compensation namely: 1. Pay- this is the basic compensation that an employee receives, usually as a
wage or salary. Employees who are paid on hourly basis are said to receive
wages. People who are paid salaries receive payments that are consistent
from time to time despite the number of hours worked. 2. Incentives – This is the compensation that rewards employees for efforts
beyond normal performance expectations. It takes the form of bonuses,
commissions, and profit sharing plans among others. 3. Benefits - These are indirect rewards such as health insurance, vacation pay,
or retirement pensions, given to an employee or group of employees as a part
of organisational membership.
THE PAY COMPONENT OF COMPENSATION.
For an organisation to have an effective pay system, it must:
Identify prevailing market wages and salaries and ensure that its pay system
is competitively favourable.
Pay competitive wages and salaries, considering organisational financial
constraints
Administer pay within legal constraints
Minimise turnover, grievances, and perceptions of inequity as a result of
dissatisfaction with the compensation package.
Control labour costs with carefully designed programs that identify a job's
value and an employee's value to the organisation.
Identify the appropriate frequency and size of raises, and restrain an
individual manager's ability to give unwarranted raises.
Induce and reward higher levels of performance.
The compensation should be able to attract, retain and motivate the right
quality of staff.
It must be flexible to adapt to environmental changes such as income and
inflation
It should be socially acceptable to the organisation’s publics who include the
shareholders, customers, government, trade unions, and civil rights bodies
BASES FOR COMPENSATION
There are 3 bases namely: 1. Time - Employees may be paid for the amount of time they are on the job. The
most common means of payment based on time is hourly pay; employees who are
paid hourly are said to receive wages, which are payments directly calculated on
the amount of time worked. The people can also be paid a salary, which is
consistent from period to period despite the number of hours worked. Being
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salaried typically carries higher status, greater loyalty and more organisational
commitment than being paid wages. 2. Performance and Productivity - A direct productivity - based system, called
piece-rate system, is one in which an employee is paid for each unit of
production. In a merit or pay-for-performance systems, employee performance is
used to make pay increase decisions. 3. Task or Skill-Based Pay - Nowadays, a growing number of organisations are
paying employees, particularly hourly ones, for the skills or competencies they
have, rather than for the specific tasks being performed. The pay can also
consider the knowledge, skills and behaviours possessed by the employees.
Leadership, problem solving skills, decision making abilities, and ability to
participate in strategic planning are some of the behaviours compensated for.
Paying for skills rewards employees who are more versatile and have continued
to develop their skills through continuous cross-functional training.
Usually an organisation ends up using a combination of approaches to
compensation, depending upon its culture, philosophy, life cycle, and financial
constraints. Whatever specific systems and programs are used, it is important that
the impact of compensation on behaviour of employees and managers be
recognised.
CHARACTERISTICS OF A GOOD COMPENSATION SYSTEM
Factors that would make a good compensation package include the following:
1. It should attract, motivate and retain the right quality of staff
2. It should compete favourably within the job market and within the job sector
of the economy
3. It should be flexible to adapt to environmental changes e.g. income, inflation
4. It should be socially acceptable to the organisation's public; the shareholders,
customers, government, trade unions, civil rights bodies
5. It should be perceived as reasonable within the framework of impartiality and
equity (affirmative action)
In making the pay level decisions then the following factors should be
considered. 1. Minimum wages
Governments specify or set legislations in relation to the minimum wages that can
be paid to employees. In Kenya, the minimum wage in 2002 was Ksh. 3,700 per
month, Ksh. 4,800 in 2005 and Ksh. 6,500 in 2006.
2. Compensation levels in other organisations
Organisations can conduct their own wage and salary surveys in order to assess
the pay levels within a particular industry, segment of an industry, or local area.
Theoretically high quality labour (in terms skills, education, experience and other
personal attributes of the employees) is more likely to migrate to those
organisations where the pay level is higher, assuming that working conditions,
location, and other personnel practices are about the same.
3. Union influences
Labour unions generally attempt to standardise wages among unionised firms in a
particular industry.
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4. Labour market and Economic conditions
Organisations raise wages and salaries when inflation is high, unemployment is
low, or a specific type of employee or occupational group is in short supply.
Conversely, pay levels rise much more slowly during periods of high
unemployment when labour is abundant. Organisations increase the pay level of
their employees in order to attract employees with scarce and high demand job
skill e.g. chemical engineers.
Increases in the cost of living also have a substantial impact on pay levels.
Periodic increases in wages and salaries are often tied directly to changes in the
Consumer Price Index (CPI) and Cost-of-Living Adjustments (COLA).
5. Organisational ability to pay and strategy
In making pay level increases, firms need to look beyond the immediate profit
picture and forecast the financial condition of the company in the future. It is
generally easier to avoid large pay increases than it is to cut pay levels later
because of financial hardships.
1. Motivation theories especially equity and expectancy theory. According to
these theories employees compare what they earn with what their
counterparts earn in other organizations. The employees will either be de-
motivated or motivated based on the outcome of the comparison.
7. The bargaining power of stakeholders such as individuals, unions,
governments, civic organisations, private consultants and so on should also be
considered.
INCENTIVE COMPENSATION PLANS
Incentives are given in addition to the wages. They can be for individuals,
groups, or organisation-wide performance.
1. Individual Incentives
These are for individual performance. They include: a. Piecework - the employee could be paid a salary for a certain output. Any
output above that is paid on a per unit basis. b. Time saved - where an employee saves time in generating a certain output,
he/she can be paid a bonus for the time saved (e.g. 50% of the time saved). c. Commissions - sales personnel can earn a commission over and above the
basic pay. d. Merit pay- this is where employees who perform very well have a sum of
money added to their base pay.
Individual incentives work best where clear performance objectives have been
set and where tasks are independent. However, the employees may stop
performing those tasks for which they are not rewarded.
2. Group Incentives
Each of the individual incentives can also be used on a group basis. This is
especially where employees' tasks are interdependent and thus require co-
operation. Organisation wide incentives are to direct the efforts of all employees
towards achieving overall organisational, effectiveness. These types of incentives
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produce rewards for all employees based on organisation wide cost reduction or
profit sharing plan. They include:
a. Group piece-rates
b. Profit sharing plans.
c. Gain sharing/ Scanlon Plan/ Rucker Plan – Whereby any resulting gains
obtained from implemented suggestions from employees are shared between
the organisation and the group
d. Employee Stock Ownership Plans (ESOPS)- these give the employees the
opportunity to buy shares of the company thereby changing their status to be
owners of the firm.
3. Plant wide incentives Plant wide incentives are intended to direct the efforts of all employees towards
achieving overall organizational effectiveness. They include the:
Scanlon plan.
Improveshare- this is an acronym for “Improving Productivity through
Sharing”. It is a mathematical formula for determining employees benefits.
Profit sharing plans- here part of the profit made by the firm is redistributed to
the employees.
4. Incentive Plans for Executives
a. Cash bonuses
b. Incentive Stock Options
c. Performance Objectives
SUPPLEMENTARY BENEFITS:
An employee’s benefit program should be guided by the following principles:
1. The benefits should satisfy the actual or perceived personal needs of the
employees
2. The benefits should convince the employees that the Organisation for which
they work cares for their needs
3. The employees benefits should provide a tax efficient mechanism in
remuneration
4. The benefits should be consistent with the strategic plans and compensation
objectives of the Organisation
5. The costs of the benefits should be calculable and provision should be made
for sound financing
Types of Supplementary Benefits are:
1. Payment for Time Not Worked e.g. Annual leave, Holidays, Sabbatical
leave, Sick leave, Public holidays, Weekends, Compassionate leave,
Maternity/ Paternity leave, Casualty, Study leave, Other personal excusable
absences, and Lunch, tea and rest breaks, etc.
2. Security & Health Benefits
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Life insurance
Worker compensation due to Disability, Death, Rehabilitation
Medical Coverage
Health Insurance
Disability Insurance
Pension Plans
Social Security
Hardship & Risk Allowances
Co-operative Savings and Credit Unions & Societies, and;
Severance Pay
3. Employee Services Benefits
Social/ Recreational Facilities & Health Programs
Subsidised Catering Facilities
Relocation Assistance
Family Planning/ Maternal Clinics/ Child Care
Purchase Discounts for the Organisation’s products
Transport allowance
Funeral Expenses
Legal Representation
Telephone credit services
Wardrobe allowance
Entertainment allowance
Educational Grants for Employees and/or for their children
Interest free/ Lower Interest/ Subsidised Loans and Mortgages
4. Retirement Benefits
Mandatory pensions
Private pensions
Gratuity benefits (for those working on contracts)
EXECUTIVE COMPENSATION
The compensation of Executives deserves special attention because:
1. The basic salaries for executives are higher than the salaries of low-level
managers or operational personnel due to economics and motivation reasons.
In economic terms, top managers are expected to demonstrate good decision-
making abilities. This skill is not widely held in the society. As a result, the
supply of qualified senior executives is scarce, and organisations have bid up
the price for this talent for competitive reasons.
2. High pay motivates/encourages top level managers to perform well in order
to keep their jobs and also stimulates the lower level managers to work hard
so that they move up the ladder to the "big money".
3. Executives receive perquisites or special benefits that others don't. This is
done to attract and keep good managers and to motivate them to work hard in
the organisation’s interest e.g.
a. Annual physical examinations
b. Interest free loans of millions of dollars
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c. Payment of life insurance premiums
d. Club memberships
e. Company automobiles
f. Liberal expense accounts
g. Supplementary disability insurance
h. Supplementary retirement accounts
i. Personal financial, tax, and legal counselling
The bonus and stock option plans can dramatically increase their compensation.
In 1999, many top executives in USA were paid huge sums of money. The CEO of
Computer Associates international was paid $650 million in salary, bonuses, and
stock based incentives. The CEOs of Citicorp, Bank of America, Compuware, and
IBM earned an average of $165 million in total compensation for the same year.
Are Executives Worth their Salaries?
If we compare the executives total compensation with their performance, we get
mixed results. Some highly paid executives perform better than others. Lee
Iacocca is an example of a highly paid manager who successfully revitalized
Chrysler Motors in the USA.
Ch. 7: DIRECTING
Chapter objectives. Following the completion of this chapter, the reader should be able to:
Explain the relevance of the different theories of motivation to the
motivation of employees including the practical methods of motivating
workers.
Discuss the importance of the communication process in the management
of human resources.
Appreciate the importance of leadership in the management of workers.
INTRODUCTION. Directing is influencing people’s behaviour through motivation, communication,
group dynamics, leadership and discipline. The purpose of directing is to
channel the behaviour of all personnel to accomplish the organization’s mission
and objectives while simultaneously helping them accomplish their own career
objectives. It also includes setting long term aims, communicating a vision and
motivating people to achieve them
Human resource managers spent a lot of time directing the efforts of
organizational members. This chapter will examine the concepts of motivation,
communication and leadership because of their importance in directing
employees. It will also examine other more practical approaches of motivating
the workers.
1. MOTIVATION.
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Motivation is the driving force that propels human action. It explains why people
do what they do and continue to do it even when they face difficulties. It is the
“why” of human behaviour.
Human resource managers should understand the concept of motivation
thoroughly because it affects the performance of workers. Motivated workers will
be both effective and efficient.
Workers can have self motivation in which they do not need external parties to
push them. Self motivation is also known as intrinsic motivation. The opposite of
self motivation is a situation where something has to be done for the person to
motivate them. This is called extrinsic motivation and involves the use of rewards
such as increased pay or promotion.
MOTIVATION THEORIES
The approaches to understanding motivation differ because many individual
theorists have developed their own views and theories. They approach
motivation from different starting points, with different ideas in mind, and from
different backgrounds. No one approach is considered to be the “ultimate”.
Each approach has contributed to the understanding of human motivation.
There are numerous theories of motivation but all the theories can be summarized
under any of the three theories.
Instrumentality theory- It ties motivation to rewards and punishments.
According to this theory, rewards or punishments dictate how people
behave. The use of rewards can increase motivation while punishment can
make workers less willing to work. Rewards are often known as “carrots”
while the punishments are referred to as “sticks”.
Content theory- this theory holds that human behaviour is related to the
needs that people have. Simply put, human beings have many needs and
most behaviour is directed towards the satisfaction of the needs and wants.
The main contributors here were Abraham Maslow (1954) and Herzberg et
al (1957).
Process theory- it holds that motivation is a process. The theories here
focus on the psychological processes which affect motivation; these are
expectations, goals and perceptions of equity. Victor Vroom (1964) and
Stacy Adams (1965) were some of the major contributors of the process
theory.
1. INSTRUMENTALITY THEORY
Instrumentality is the belief that there is always a reaction for every action. It is
based on the strong belief that money is the strongest reason for working and that
to motivate workers it may be necessary to pay them more money. Less income is
a source of de-motivation. This theory was first contained by Fredrick Winslow
Taylor in his scientific management theory.
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2. CONTENT (NEEDS) THEORY
This theory is based on the premise that human beings have a wide variety of
needs and that whenever a need reaches the threshold level, the person strives to
satisfy it. Needs range from the most basic to very high level needs such as the
need for self actualization.
The importance of a need depends on an individual’s background and present
situation. To an hungry person, the main focus is on food - man lives on bread
alone when there is no bread! Nevertheless, there is no simple relationship
between needs and goals and a need can be satisfied through different
approaches.
It was Abraham Maslow( 1970) who first introduced the concept of needs. Other
contributors were Clayton Alderfer with the Existence, Relatedness, and Growth
(ERG) needs theory, and the Herzberg’s two factor theory.
a) Maslow’s Hierarchy of Needs theory
Abraham Harold Maslow was born April, 1908 in New York to an uneducated
Jewish couple which had migrated from Russia. The family of nine was actually
needy based on the low income of the parents. His parents encouraged him to
work hard in school.
Consequently, he received his Bachelor of Arts degree in 1930, his Master of Arts
degree in 1931, and his PhD in 1934, all in psychology, all from the University of
Wisconsin. Thereafter, Maslow became interested in research on human
sexuality.
Abraham Harold Maslow classified the needs that people have into five major
categories which the basic, safety, social, esteem and self actualization needs.
1. Physiological needs – this is the first and possibly the most important
level of needs. These are the needs for oxygen, food, water, warmth,
shelter, and sleep. They are also known as basic needs. These needs
can be met by giving employees housing allowances, having company
cafeterias possibly with subsidized meals, giving employees company
uniforms, provision of clean drinking water to the employees and
paying them wages that can afford the basic necessities among other
approaches.
2. Safety needs– they relate to the needs for protection against danger or
against any unpredictable happenings in life. They include protection
from the fear of accidents, ill health, or even losing a job, property,
food, or shelter. This need can be met by providing insurance (health,
accident, disability etc) to the employees, having body guards or
security personnel for the senior managers, engaging security services
and so on.
3. Social needs– these are the needs for love, affection and acceptance by
others especially those of the same group. The family is a very special
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group. This need includes a striving to be accepted by those to whom
we feel close and to be an important person to them. Employees should
have the freedom to join formal and informal groups. They should also
have time for recreation and to socialize with other members of the
society.
4. Esteem needs – these are the needs to have a high evaluation of oneself
(self esteem) and to have the respect of others (prestige) as well as a
high reputation in the society. It is this kind of need that produces
strivings for power, prestige, status, and self confidence. Company cars
and good job titles can be a source of esteem for employees.
5. Self-fulfilment (self-actualization) needs – they are the needs to develop
potentialities and skills, to become what one believes one is capable of
becoming. These are the highest level of needs. Many individuals rarely achieve
these needs unless they have set very low goals in their lives. Some of the people
who often self actualize include musicians and authors. Employees should be
allowed to pursue education if it helps them to self actualize. The freedom to
change careers should also be availed.
The needs hierarchy of needs theory can be portrayed in a figure as below.
Self
Actualization
Esteem
(Self and others)
Belonging and Love
Safety and Security
Basic (physiological) Needs
According to Maslow, whenever a lower level need such as food is satisfied, the
next higher level need (such as safety needs) becomes dominant and the
individual’s attention is turned to satisfying it. The self actualization need is the
most difficult need to satisfy. And because needs recur or takes different forms,
they can never be fully satisfied.
Workers are more motivated if what they do satisfies their needs especially the
higher level needs. Routine and repetitive jobs may not go far in motivating
employees. As such, human resource managers should be able to redesign jobs
to make them more challenging.
Some of the criticisms advanced against Maslow’s theory are outlined as below.
The most common criticism concerns his methodology. His sample size
was too small to make generalizations from.
The hierarchy assumes human needs can be met in a hierarchical pattern
which is not true because one can seek self actualization even if the basic needs
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have not been fully met. People have different priorities of what they consider to
be needs. It is common for some people to emphasize self esteem needs even
when they have not properly satisfied the basic needs of food, shelter and
clothing.
The hierarchy assumes individuals can be motivated in relative isolation of
needs. This might not be true because the dividing line between one need and
another may be very thin.
The theory also assumes that once a need is satisfied, it no longer acts as a
motivator. This is not totally true because needs recur. The need for food seems
to recur many times in a day.
This theory seems to simply point the way. He hoped that others would take up
the cause and complete what he had begun in a more rigorous fashion
Clay Alderfer (1977) refined the idea of Abraham Maslow by categorizing needs
into three levels namely existence, relatedness, and growth needs. Like Maslow,
Alderfer proposed that satisfied needs become dormant unless a dramatic shift in
circumstances increases their salience. The problem with hierarchial needs
theories is that although they help us to understand general developmental
processes, from child to adult, they are not very useful for understanding the day-
to-day motivation levels of adult employees.
b) Herzberg’s two- factor model of motivation
Herzberg et al (1975) formulated this theory after investigating the sources of job
satisfaction and dissatisfaction among accountants and engineers. The subjects
were asked to tell their interviewers about the times during which they felt
exceptionally good and exceptionally bad about their jobs and how long their
feelings persisted. The study found that the accounts of ‘good’ periods most
frequently concerned the content of the job, particularly achievement,
recognition, advancement, responsibility, and the work itself while accounts of
‘bad’ periods most frequently concerned the context of the job. Company policy
and administration, supervision, salary and working conditions were quoted
category of “bad” times.
The conclusions of Herzberg et al were that there are some factors which if
present do not motivate but bring motivation to level zero. These are the hygiene
factors and they are such that if they are absent they cause de-motivation among
workers. The term hygiene is medical and implies the preventive and
environmental impact of these factors. The other factors are the motivators
because they cause positive motivation among the workers.
3 PROCESS THEORIES
Here the emphasis is on the psychological processes or forces that affect
motivation, as well as on basic needs. It is also known as cognitive theory
because it is concerned with people’s perceptions of their working environment
and the ways in which they interpret and understand it. The process theories
provide a much more relevant approach to motivation that replaces the very
simplistic theories of Maslow and Herzberg.
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The process or cognitive theories can certainly be more useful to managers than
needs theory because they provide a more realistic guidance on motivation
techniques. The process theories include the:
Expectations (expectancy theory)
Goal achievement (goal theory)
Feeling about equity (equity theory)
a) Expectancy Theory
The concept of expectancy was originally contained in the Valence-
Instrumentality-Expectancy (VIE) theory which was formulated by Victor Vroom
(1964)
Valence stands for value placed upon a particular reward by a person. Some
individuals value promotion highly.
Instrumentality is the perception of the relationship between performance and
rewards. Higher performance can lead to promotion.
Expectancy is the probability that an action or effort will lead to an outcome. It is
actually the perceived relationship between effort and performance.
A salesperson who believes that by working more hours in a day he or she will
make more sales and the more sales will lead to a higher income where the
person appreciates a high income, and then the sales person will be more
motivated. Where one of the variables in the relationship does not hold, this will
negatively affect motivation.
b) Goal theory
Goal theory was developed by Latham and Locke (1979). It states that motivation
and performance are higher when the goals set for individuals are specific,
difficult but acceptable, and when there is a feedback on performance.
Participation in goal setting is important as a means of getting agreement to the
setting of higher goals. Difficult goals must be agreed and their achievement
reinforced by guidance and advice. Finally, feedback is vital in maintaining
motivation, particularly towards the achievement of even higher goals.
Maslow (1954) also emphasized the need for acceptance of and commitment to
goals. He found that, as long as they are agreed, demanding goals lead to better
performance than easy ones. He also emphasized the importance of feedback.
c) Equity theory
The Equity or Inequity theory is the work of J Stacy Adams (1965).
This theory is concerned with the perception people have about how they are
being treated as compared with others. To be dealt with equitably is to be
treated fairly in comparison with another group of people (a reference group) or
a relevant other person. Equity involves feelings and perceptions and is always
comparative since this would be inequitable if they deserve to be treated
differently. Equity theory states, in effect, that people will be better motivated if
they are treated equitably and de-motivated if they are treated inequitably. It
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explains only one aspect of the process of motivation and job satisfaction,
although it may be significant in terms of morale.
The theory can be shown as below.
Outcomes by a person = Outcomes by another person
Inputs by a person Inputs by another person.
Outcomes are what workers are getting out of the work relationship and they
include items such as pay, fringe benefits, increased responsibility, and prestige.
The inputs refer to what the employees are putting into the work relationship.
Inputs include hours worked, work quality, education and experience.
Areas that may lead to feelings of inequity include monetary rewards, workload,
promotion, degree of recognition, supervisory behaviour, targets and assigned
tasks.
Ideally, there are two forms of equity: distributive equity which is concerned with
the fairness with which people feel they are rewarded in accordance with their
contribution and in comparison with others: and procedural equity or procedural
justice, which is concerned with the perceptions employees have about the
fairness with which company procedures in such areas as performance appraisal,
promotion and discipline are being operated.
Interpersonal factors are closely linked to feelings about procedural fairness.
Five factors that contribute to perceptions of procedural fairness have been
identified. These are:-
Adequate considerations of an employee’s viewpoint:
Suppression of personal bias towards the employee;
Applying criteria consistently across employees;
Providing early feedback to employees concerning the outcome of
decisions;
Providing employees with an adequate explanation of the decision made
4 Other theories
Chris Argyris
Argyris’s research interests were in the relationship between people’s needs
and the needs of organizations. He suggested that the reason for so much
employees apathy is not so much of laziness, but rather because of people
being treated like children. This led to his so-called Immaturity theory which
suggests that the human personality develops from immaturity to maturity in a
continuum, in which a number of changes take place. These are as follows:
Immaturity-Maturity Theory
Immaturity Maturity
Passivity Activity
Dependence Relative independence
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Behave in few ways Behave in many ways
Erratic, shallow interests Deeper interest
Short time perspective Long time perspective
Subordinate position independence Equal or superior position
Lack of awareness of self Awareness and control over self Source: G.A. Cole Management Theory and Practice
The main reasoning behind this theory is that when human resource managers
perceive employees as being immature, then they expect the employees to
exhibit the behaviours of immaturity a shown in the table above. The best
management practice would be to perceive the employees as being mature.
Douglas MC Gregor – Theory X & Theory Y
Douglas Mc Gregor (196) proposed the concept of Theory X and Theory Y. He
maintained that there are two fundamental approaches to managing people. The
approaches depend on the manager’s perception of the employees. Theory X
assumptions are negative perceptions of employees. Many managers who lean
towards theory X generally get poor results. Enlightened managers use theory Y,
which produces better performance and results, and allows people to grow and
develop.
Theory X (authoritarian management style) assumptions include:
The average person dislike work and will avoid it
Therefore most people must be forced/ coerced, controlled, directed, and
threatened with punishment in order for them to work towards
organizational objectives
The average person prefers to be directed, to avoid responsibility,
relatively lacks ambition, and wants security above all else.
Theory Y (participative management style) assumptions are that:
Effort in work is as natural as work and play
People will apply self –control and self-direction in the pursuit of
organizational objectives because of the importance of the rewards
associated with the achievement.
The degree of commitment to objectives is in proportion to the size of the
rewards associated with their achievement.
People usually accept and often seek responsibility.
The capacity to use a high degree of imagination, ingenuity and creativity
in solving organizational problems is widely, not narrowly, distributed in
the population.
In modern industrial life, the intellectual potential of the average person is
only partly utilized.
Skinners reinforcement theory.
The psychologist B.F Skinner developed the positive reinforcement or behaviour
modification. The theory holds that individuals can be motivated by proper
design of their work environment and praise for their performance while
punishment for poor performance produces negative results.
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David McClelland (1971) advocated for motivation by satisfying the overriding
need in the individual. Some individuals have a high need for power (n/PWR),
others have a high need for affiliation (n/AFF), while others have very high needs
for achievement (n/ACH). Individuals with high needs for achievement are
characterized by a tendency to set moderately difficult goals, a strong desire to
assume personal responsibility for work activities, a single minded focus on
accomplishing a task, and a strong desire for detailed feedback on task
performance.
The need for affiliation involves a strong attraction to other individuals in order to
feel reassured and acceptable. Individuals with a high need for affiliation are
characterized by a sincere interest in the feelings of others, a tendency to
conform to the expectations of other especially those whose affiliations they
value, and a strong desire for reassurance and approval from others.
The need for power manifests itself in the desire to influence others and to control
one’s environment. Individuals with a high need for power seek leadership
positions and tend to influence others in a fairly open, direct manner.
PRACTICAL METHODS OF MOTIVATING WORKERS
The theories outlined above provide a sound basis for understanding motivation.
Nevertheless, the human resource managers must devise more practical
approaches to motivating the workers. Some of the approaches are briefly listed
below.
The use of participative or consultative management styles.
Adopting an open door policy.
Having managers who are available, understanding, and able to
assist employees through activities such as counselling.
Availing recreational facilities for employees.
Collective goal setting.
Good working conditions.
Promotion from within
Employees made to feel valued.
Interest free loans or loans with low interest rates.
Status enhancement
Positive communication
Recognition of individuals and their contributions to the firm.
COMMUNICATION
Communication is a very important subject to any manager. Managing is getting
things done through others, a task that requires the manager to communicate with
other people. To communicate is to make known, to impact or to transmit
information. Communication forms the bridge between managers and
employees.
Managers must receive and give ideas, reports, and instructions; explain
problems; give demonstrations; and also keep in touch with its relevant
environments (customers, suppliers, dealers, regulations etc). Talking, listening,
attending meetings, reading and writing occupies most of the manager’s time.
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Communication is needed to establish and disseminate goals of an enterprise,
develop plans for their achievement, organize human and non human resources,
select, develop and appraise staff, control performance, and direct, lead and
motivate employees.
For communication to be effective the message sender must have a good
knowledge of the receiver. Overestimation of the capability of the receiver ( e.g.
his/her intelligence) will lead to misunderstanding of the message. Income,
social status, responsibilities and position of the receiver all affect and influence
the way a message is perceived.
A SIMPLE COMMUNICATION MODEL
NOISE
FEEDBACK
Types of Communication
Communication in an organization is either external or internal.
Internal communication takes place between people in the organization and
others outside the organization. All organizations generate internal
communication and the communication flow is multidirectional.
It could either be:
a) Vertically upward – from lower to higher level through the chain of
command.
b) Vertically downward – from higher to lower levels.
c) Direct horizontal – when an individual from one department
communicates to another in another department but at the same
organizational level.
d) Indirect horizontal – occurs between people of different organizational
levels and in different departments.
e) Depending on the nature of the firm zigzagging or diagnosing of
messages cannot be ruled out.
SENDER MESSAGE CHANNEL RECEIVER
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The firm also invites communication with groups outside and as the organization
grows external communication grows. These groups include customers,
suppliers, government, competitors etc.
Forms of communication Written communication is in form of letters, memos, manuals or minutes. It has
the advantage of providing records and references. Most communication in
organizations is oral. It provides immediate feedback and unclear issues can be
classified immediately. It can easily be altered or adjusted to suit the receiver.
Non Verbal Communication includes facial expressions, body gestures, eye
movements, and distance maintained among many others.
Communication barriers can arise from sender, channel, receiver or from the
surroundings. They include:
Lack of planning to communicate
Semantic distortion (language)
Poor expression (language)
Loss of transmission
Poor retention
Poor listening
Hasty (premature) evaluation
Distrust, threat and fear
Insufficient period to make adjustments for change
Noisy environment.
Upward communication This is communication of subordinates with the managers and it continues up the
organizational hierarchy. It can be effected through:
Face to face contacts
Meetings with supervisors
Special organisation wide elected councils that meet with top management
periodically
“Speak up” programs where employees are given a telephone number to call
Anonymous complaint boxes
Annual employee meetings
Grievance procedures
Morale questionnaires
Exit interviews
Open door policy
The labour union
Grapevine
The ombudsperson.
Employee counselling programs
Downward communication
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This is communication flows from people at higher levels to those at lower levels
in the organizational hierarchy. It can be done using oral or written means. In an
organizational setting, managers can communicate to subordinates through:
The chain of command
Posters and the bulletin boards
Company periodicals
Letters to employees
Employee handbooks
Information racks
A loudspeaker system
Pay inserts
The grapevine
Annual reports
Group meetings
The labour union
LEADERSHIP Leadership is an important aspect of human resource management. It is the art or
process of influencing people so that they will strive willingly and enthusiastically
toward the achievement of group goals. Leaders should not just push people but
they should cultivate the free willingness among the people.
Good leaders use their power effectively and in a responsible manner. They are
also aware that human beings have different motivations at different times and at
different situations. Moreover, leaders should have the ability to inspire and to act
in a manner that will develop a climate conducive to responding to and arousing
motivations.
There are five sources of power for leaders. Legitimate power is associated with
the leader’s position in the organization. Such power could be held by the human
resource manager, marketing manager, managing director and so on; it is based
purely on position and not necessarily on the ability to influence. Reward power
stems from the perception that the leader is able to reward another individual.
Examples of rewards are pay rises and favourable job assignments. Coercive
power is the opposite of reward power; it is where the leader can coerce
subordinates through demotion, firing, or silent treatment among other methods.
Referent/charismatic power is derived from the desire to be like the power
holder while expert power is the power of knowledge.
There are a number of approaches to leadership. The “great man theory”
advocates for leaders being born. The traits theory holds that effective leaders
are associated with the ability to supervise others, decisiveness, ability to
manage change, natural energy and enthusiasm, being assertive and confident,
as well as intelligence and the ability to conceptualize the activities of the whole
organization
The functional or group approach focuses on the functions of the leader. It holds
that the skills of leadership can be learnt, developed and perfected. Krech et al
identified 14 functions performed by leaders whereby the leader can be an
executive, planner, policy-maker, expert, an external group representative,
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controller of internal relations, giver of rewards and punishment, an arbitrator
and mediator, setting examples, a symbol of the group, substitute for individual
responsibility, an ideologist, a father figure, and as a scapegoat to accept blame
in the case of failure.
According to the situational approach, leadership is affected by the situation from
which the leader emerges and in which he or she operates. It is also known as the
contingency approach. The path goal theory says that the main function of a
leader is to clarify and set goals with subordinates, help them achieve the goals,
and remove obstacles.
Broad classification of leadership styles There are many dimensions to leadership and many possible ways of describing
leadership style, such as, for example, dictatorial, unitary, bureaucratic,
benevolent, charismatic, consultative, participative and abdicatorial.
The style of managerial leadership towards subordinate staff and the focus of
power can be classified within a broad three-fold heading.
The authoritarian (or autocratic). This is where the focus of power is with
the manager, and all interactions within the group move towards the manager.
The manager alone exercises decision-making and authority for determining
policy, procedures for achieving goals, work tasks and relationships, control
rewards or punishments.
The democratic style is where the focus of power is more with the group
as a whole and there is greater interaction within the group. The leadership
functions are shared with members of the group and the manager is more part of
a team. The group members have a greater say in decision-making,
determination of policy, implementation of systems and procedures.
A genuine laissez-faire style is where the manager observes that
members of the group are working well on their own. The manager consciously
makes a decision to pass the focus of power to members, to allow them freedom
of action and not to interfere; but is readily available if help is needed.
Futrell (2000) suggests that leaders have a strong, defined sense of purpose; are
effective communicators, persistent and hardworking; they also are learners who
are aware of themselves; they love their work and inspire others; leaders are risk
takers who establish human relationships based on trust, respect and care;
leaders are keen to motivate and inspire other people to achieve their goals.
BIBIOGRAPHY
1. Armstrong, M.A. Handbook of Human Resource Management Practice
(8th edition) The Bath Press Ltd Great Britain. 2. Dr. Robert L. Mathis and Dr. John H. Jackson, HR Management –
Strategies and Environment (9th edition) University of Nebraska – Lincoln.
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3. Scarpello & Ledvinka, Personnel /Human Resource management (2nd
Edition) PWS-Kent Publishing Co, Boston. 4. G. A. Cole Management Theory and Practice, (2nd Edition), Guensey
Press Co. Ltd., Channels Islands 5. Decenzo, D.A. and Robbin, S. P. Personnel Management and Human
Resource Management (3rd Edition), London, Prentice Hall.
6. Abraham Maslow Toward a Psychology of Being Motivation and
Personality (1st & 2nd Edition), and The Further Reaches of Human Nature
7. Maslow, A.H. (1943) “A theory of human motivation”, Psychological Review,
July, pp.121-125.
8. Vroom, V.H (1964), Work and Motivation, Wiley, New York.
9. Adams, J.S (1965), Inequity in social exchange”, in Berkowitz, L. (ed.),
Advances in Experimental Social Psychology, 2, Academic Press, New York.
10. Futrell, C.F (2000), Sales Management, Dryden Press, Orlando.
Ch.14 CONLICT MANAGEMENT Chapter objectives The objectives of this chapter are to:
Differentiate the negative and positive impacts of conflicts
Understand the sources of conflicts among employees in the organization.
Explain the strategies that can be used to resolve conflicts among
employees in the firm.
Introduction Conflicts are common features of many organisations. Conflicts occur when
individuals or groups feel that other individuals or groups have frustrated or are
about to frustrate their plans, ideas, proposals, interests, resources, goals,
beliefs, or activities. The consequences of conflict and failed negotiations,
whether it is between labour and management, groups, individuals or nations can
be costly to individuals and to organisations.
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Conflict is a behaviour intended to obstruct the achievement of some other
person’s goals. It is based on the incompatibility of goals and arises from
opposing behaviour. It can be viewed from the individual, group, or
organizational level.
It should be understood that conflicts are not necessary bad in an organizational
setting. The consequences of conflicts can be better ideas generated for the way
forward, long standing problems unveiled, and clarification of individual views.
Nevertheless, extreme levels of conflicts can make some people feel defeated or
demeaned; a climate of mistrust and suspicion can also be developed and even
some employees may decide to “eliminate” others. The rate of labour turnover
can increase as other employees avoid teamwork and concentrate on their
narrow interests.
Sources of conflicts The sources of conflicts are as varied as the types of conflicts that exist. Generally
speaking there are four broad sources of conflicts namely personal differences,
informational deficiencies, role incompatibility, and environmental stress.
Personal differences imply that individuals are different in terms of their cultural
and family traditions, level of education, breadth of experience, and so on. This
often leads to a cognitive conflict which is a situation when a person or a group
holds ideas or opinions that are inconsistent with those of others. Differences in
perceptions and expectations result in different people attaching different
meanings to the same stimuli. Personal differences can also lead to affective
conflicts which occur when one group’s emotions, feelings or attitudes are
incompatible with those of others. It is common to find individuals with acute and
almost irreconcilable personality differences.
Informational deficiencies can also be a source of conflicts. Conflicts based on
misinformation or misunderstandings tend to be factual hence clarifying previous
messages or obtaining additional information generally resolves the dispute.
Role incompatibility conflicts are similar to conflicts arising from personal
differences or information deficiencies. Incompatibility can lead to goal conflicts which occur when a person or a group desires a different outcome. Inter-group
discussions should be encouraged. When the conflict occurs, avoid a win-lose
approach to solving it. Behavioural conflict occurs when one group or person does
something which is unacceptable to others. It is also known as role conflict and
occurs when a person occupying a certain office exhibits behaviour which is
contrary to what is expected. Role ambiguity is also a significant source of
conflict.
Related to role incompatibility are departmentalization, specialization,
performance standards, and violation of territory. Sometimes the activities of one
department depend on the activities of another department. For example, the
marketing department relies on the production department for the goods to be
produced before they are passed over to the customers. Many departments tend
to concentrate on the achievement of their own particular objectives. This creates
potential for conflicts. Similarly, if reward and punishment systems are perceived
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to be based on keeping up with performance levels especially when the
performance expectations are very high, then the potential for conflict is high. In
other cases, the treatment of workers by management is biased or inequitable;
this can lead to tension and conflict. And people tend to become attached to their
own “territories” within the work organization. Examples of territories are the
area of working, the type of clients dealt with, parking slots, the chair sat on and
the room worked in. if violated, then a conflict could arise.
Environmentally induced stress can also be a major source of conflicts. The stress
can be induced by resource scarcity and uncertainty. Scarcity tends to lower
trust, increase ethnocentrism, and reduce participation in decision making. The
greater the limitation of organizational resources, the greater the potential for
conflict.
Strategies for resolving conflicts in organizations.
The strategy used to manage or resolve the conflict will depend on the nature and
source of conflict. The main strategies used include forcing, accommodating,
avoiding, compromising, and collaborating.
The forcing strategy seeks to satisfy one’s own needs at the expense of the needs
of other individuals. This can be achieved through the use of formal authority,
physical threats, manipulation ploys, and ignoring the claims of the other party.
The problem with this conflict resolution approach is that it breeds hostility and
resentment. It can also take the form of Character assassination in which attempts
are made to discredit the person concerned and to distance him or her from
others in the group. The person affected can respond by taking legal action or
damaging the image of the organization.
The accommodating approach satisfies the other party’s concerns while
neglecting one’s own. The problem with this approach is that others may take
advantage of you which also lowers your self esteem.
The avoiding response neglects the interests of both parties by sidestepping the
conflict or postponing a solution. It can take the form of non action whereby a
manager strongly believes that by ignoring the problem it will eventually
disappear. It can also take the form of administrative orbiting in which the
management adapts the policy of requiring more information in order to solve the
conflict. This should be used carefully because the anger of the employees can build up. In due process non-action, the conflict resolution procedure is made
long, costly, complicated, and risky for the affected employees. The aim is to
wear down the dissatisfied employees while at the same time claiming that the
resolution procedures are open and available. Some managers keep some of the
organizational information secret (such as pay) as a way of reducing conflict.
The compromising response is an attempt to obtain partial satisfaction for both
parties. In resource distribution, managers should use their imaginations and
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initiative to help overcome conflict situations. And in situations where financial
resources are limited, greater attention should be given to non monetary rewards
such as job design, more challenging work, increased delegation or
empowerment, flexible working hours and attending courses or conferences.
Personnel policies and procedures should also be just and equitable especially in
the areas of job analysis, recruitment and selection, job evaluation, and reward
and punishment systems. Moreover, a more participative and supportive style of
leadership and managerial behaviour is likely to assist in conflict resolution.
The collaborative approach is an attempt to address fully the concerns of both
parties. It is a win-win strategy and it can take the form of clarification of goals and
objectives, role definitions, and performance standards which helps to avoid
misunderstandings and conflict. It is recommended that managers emphasize
organization- wide goals.
Strategies for minimizing conflicts in organizations Prevention is always better than cure. The implication is that managers should
seek to prevent conflicts from occurring. This may be difficult but it is possible.
Suggestions for preventing the occurrence of conflicts include the following (
Okumbe, 2001).
Physical separation of the affected employees;
Ensuring that rules and regulations are enforced and followed;
Limiting inter-group interactions especially when the groups don’t depend on
each other directly or when they are likely to conflict;
Encouraging team building exercises that involve all the departments so that
each department can learn to appreciate the other departments.
Use of integrators which perform the boundary spanning role between
groups;
Confrontation of the affected persons and negotiation of the conflict;
Third party consultation through people who understand human behaviour;
Rotation of members;
Counselling employees so that they learn to control issues that could lead to
conflicts.
Involving employees in decisions that affect them and which may bring a
change on the status quo. By so doing they will not resist the change strongly
and probability of conflicts will be minimized.
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CH. 15: EMPLOYEE RELATIONS
Chapter objectives. After reading this chapter, it is expected that the reader will be able to:
Explain the grievance settling procedure
Understand why employees join labour unions
Discuss the collective bargaining process
Analyse the different types of strikes and the conditions under which they
occur.
Appreciate the importance of managing employment relationships.
Introduction Working with other people in an organisation has many challenges. Often
disagreements occur between or among people. An employee may then have
grievances against another employee, a supervisor, team leader or even the
whole organisation. Sometimes the problem or grievance may be affecting many
employees who then opt to join labour unions.
Grievance settling Procedure: This is a formal communications channel designed to settle a grievance as soon as
possible or immediately they arise. The procedure is: -
The employee should discuss the grievance with the immediate supervisor
The employee then discusses the grievance with the shop/union steward.
If the problem is not solved at this level, the union steward discusses the
grievance with the supervisor's manager.
Where the problem still persists, the shop steward informs the union
grievance committee which discusses the grievance with the unit plant
manager or the employer’s human resource department
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The representative of the national union discusses the issue with the company
general manager
The final step may be the use of an impartial umpire or arbitrator for ultimate
disposition of the grievance
Where an individual feels that a union is not doing enough, he/she can take
legal action.
Labour/ Trade Unions
Employees may highly appreciate their jobs for quite sometimes. However, as
times go by, they may experience some dissatisfaction that may make them to
join labour unions. The aim of joining the labour union is to correct a gap which
the employees feel that the management is not ready to correct under normal
circumstances.
A trade union is an organisation that represents employees' interests to
management on issues such as wages, working hours, and working conditions.
A labour union or trade union may also be defined as an organisation of workers
formed to promote, protect, and improve through collective action, the social,
economic, and political interests of its members. The dominant interest with
which the union is concerned is economic. In this area desires and demands for
improved wages, hours, and working conditions are foremost.
Why Employees Organise Labour or Trade Unions:
Employees join trade unions for a variety of reasons. Some of them are briefly
discussed below.
a. Job Security - Employees want to be confident that the jobs they have today will
definitely exist in the future and that they will be treated fairly and will not be
discharged without just cause.
b. Good Working Conditions – a safe and healthy place to work coupled with high
quality standards in both product and job environment is important to workers. c. Opportunity to Advance – employees want to be certain that their organisations
will consider them for promotion to higher paying, more responsible jobs. d. Importance of the Work – work itself is important to employees. The employees
want to feel that their efforts are making a relevant contribution to the
organisation. Where an employee does repetitive, routine tasks, she/he may
become bored and feel they have no identity hence they seek unionisation.
Human resource managers should continually adopt job enrichment programs to
ensure the jobs of employees are challenging. e. Opportunity to be heard – a union provides a vehicle for employees to express
their dissatisfactions and disagreements with a particular job matter. f. Need to be recognised –jobs well done deserve recognition, and exemplary
performance calls for an occasional word of thanks. Workers who do not receive
recognition so as to reinforce positive behaviour may join unions. g. Need To be respected – in some cases supervisors may be treating employees in
too harsh and authoritative ways leading them to seek refuge in trade unions. h. Need to belong – people need to associate with other human beings and feel
they belong. Unions meet these needs by offering an organisation of people with
common interests. Through meetings, educational programs, social events, and
other activities designed to involve members, unions build a strong bond
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brotherhood. Many workers join a union because it gives them a means of
expressing their leadership aspirations. i. Money – Unions negotiate for the employees to receive a fair day's pay for a fair
day's work. Indeed financial incentives are probably the greatest motivation for
employees when considering entering into trade unions j. Political Gains- many individuals use the trade union movement to gain political
mileage.
COLLECTIVE BARGAINING
Whenever there are disagreements or conflicts between union members and a
firm’s management, these are solved through the collective bargaining process.
Collective bargaining is thus the process whereby representatives of
management and those of workers negotiate over wages, hours and other terms
and conditions of employment. It is a give-and-take process between
representatives of the two sides.
The Issues Discussed Include:
Discharge of Employees
Job Security
Grievances
Work Schedules
Retirement and Person Coverage
Vacations
Christmas Bonuses
Safety Rules
Profit Sharing Plans
The attitude of management toward unions is one major factor in determining the
relationship between union and management. Where management and union see
each other as enemies, the collective bargaining process can lead to conflicts
while in a situation where both parties view each other as friends, the process
may lead to collusion
THE PROCESS OF COLLECTIVE BARGAINING: The representatives of the management as well as those of the trade union go
through 4 steps in the collective bargaining process. These are listed below.
1. Preparation
2. Initial demands
3. Continued negotiations. These may lead to a bargaining disagreement or
impasse
4. Settlement and contract signing.
Preparation:
Both parties must prepare themselves for the negotiation. The management must
especially prepare itself by:
a. Approve the plan for negotiations with top management
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b. Conduct an audit and analysis of grievances
c. Review the contracts made with the workers
d. Conduct wage and benefit surveys of competitors
e. Designate a bargaining team
f. Plan for contingencies e.g. strikes etc
g. Brief directors
h. Designate date and time for bargaining with workers
2. Initial Demands:
Typical bargaining includes an initial proposal of expectations by both sides. The
way initial demands are presented will determine the direction of the
negotiations to follow.
3. Continuing Negotiations:
After opening positions have been taken, each side attempts to determine what
the other values highly so that the best bargain can be struck. It is important to
determine who has the stronger bargaining power. This depends on economic
factors, socio-demographic factors such as how easy it is to get other workers,
and the legal environment.
There are a number of bargaining tactics to use, for example:
Game playing - here a few representatives from each side hold a secret meeting
prior to the official opening of the negotiations, and they reach an agreement on
the essential issues. When the negotiations begin these individuals put on a sham
battle including table thumping, and name-calling before they all settle for
common agreements.
Bluffing - here the negotiators attempt to gain a little more than they are willing
to finally settle for. An example is a case where a 50% salary increase has been
awarded and the union tries to negotiate for at least 80% salary increase.
Bargaining Impasse:
Where the labour and management do not reach agreement on issues, then
strikes and lockouts may occur. During a strike, union members refuse to work in
order to put pressure on an employer. Often the striking union members picket
or demonstrate against the employer outside the place of business.
In a lockout, management shuts down company operations to prevent union
members from working. This action may also avoid possible damage or sabotage
to company facilities or injury to employees who continue to work.
Both strikes and lockouts are forms of pressure on the other party. By striking the
union attempts to pressurise management into making some concessions and
signing a contract. However, management may respond by hiring replacement
workers or may operate the company by using supervisors and managers to fill in
for striking workers. By locking out workers, an employer put economics
pressure on union members in the hope that they will make concessions and
support a contract agreement.
Types of Strikes:
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Economic Strikes - occur when the parties fail to reach agreement during
collective bargaining.
Unfair Labour Practice Strikes - occur when union members walk away from
their jobs over what they feel are illegal employer actions such as refusal to
bargain.
Wildcat Strikes - occur during the life of the collective bargaining agreement
without approval of union leadership and violate a no-strike clause in a labour
contract. Strikers can be discharged or disciplined.
Jurisdictional Strikes - occur when one Unions member walks out to force an
employer to assign work to them instead of to another union.
Sympathy Strikes - express one Union's support for another involved in a
dispute, even though the first union has no disagreement with the employer
During times of strikes the employer should take safety precautions by:
Making sure the plant is left in good physical condition
Explaining the employer’s side of the issue to the employees
Giving a press statement
Notifying suppliers and customers
Notifying the appropriate mediation services
Determining to what extent non-union personnel will be maintained on the
working staff
Paying off striking workers for work completed in the past
Conciliation or Mediation:
Conciliation or mediation occurs when an outside individual attempts to help two
deadlocked parties continue the negotiations and arrive at a solution.
In conciliation a third party attempts to keep the union and management
negotiators talking so that they voluntarily can reach a settlement. In mediation a
third party assists the negotiators in their discussions and also suggests
settlement proposals.
Arbitration:
This is a means of deciding a dispute in which negotiating parties submit the
dispute to a third party to make a decision. Either an individual or a panel of
individuals can conduct Arbitration.
4. Settlement & Contract Agreement – after an initial agreement is made,
the two sides usually return to their respective members to determine if what they
have informally agreed on is acceptable to them. If approval is voted, the
agreement is then formalised into a contract. The agreement also contains
language on the duration of the contract.
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CH. 16: EMPLOYEE HEALTH AND SAFETY
Chapter objectives A reader who has successfully read this chapter will be able to:
Differentiate employee health from employee safety
Explain the differentiate sources of accidents in the workplace
Analyse the critical health issues that human resource managers have to
deal with
Appreciate the importance of employee health and safety.
Introduction The management of every organisation has a responsibility to ensure that the
workplace is free from unnecessary hazards and that conditions surrounding the
workplace are not hazardous to the physical and/or mental health of employees.
The managers must also ensure that the employees are safety conscious and are
encouraged to maintain good health.
Definition of Terms: Health refers to a general state of physical, mental and emotional well being. A
healthy person is one who is free from illness, injury, or mental and emotional
problems that impair normal human activity. Health management practices in
organisations strive to maintain the overall well being of individuals.
Safety refers to protection of the physical well being of people. The main purpose
of effective safety programs in organisations is to prevent work-related injuries
and accidents.
Health & Safety Policies focus on the safe interaction between people and the
work environment. In many organizations, the management and the employees
neglect the health and safety aspect. Nevertheless, ignoring this element can lead
to a lot of pain and suffering to organizational members and to their dependants.
Its importance cannot be overemphasized.
REASONS FOR SAFETY PROGRAMS: Safety programs are undertaken for three fundamental reasons:
Moral - managers undertake to prevent accidents so as to minimise the pain and
suffering the injured worker and his family are exposed to as a result of the
accident.
Legal - Organisations are subject to fines, and supervisors can receive jail
sentences if found responsible for fatal accidents. Moreover, the image of the
organization can be damaged following an unfortunate event.
Financial - the cost to the company of even a small accident can be quite high.
These include:
Payment for settlements of injury or death claims
Legal fees for defence against claims
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Costs of rescue operations
Loss of function and operations income
Training costs for replacements
Increased insurance costs
BENEFITS OF SAFETY PROGRAMS: Tangible benefits of a well-managed safety program include:
Reduction of insurance premiums
Lower absences
Savings of accident and litigation costs
Fewer wages paid for lost time
Less expenses in training new workers
Less overtime
Meeting the demands of clients
Higher productivity
More motivated workforce
CAUSES OF ACCIDENTS: Unsafe conditions (of one sort or another) are one main cause of accidents. They
include:
Improperly guarded equipment
Defective equipment
Hazardous arrangement or procedure in, on or around machines or
equipment
Unsafe storage - congestion, overloading
Improper illumination - glare, insufficient light
Improper ventilation - insufficient air change, impure air source
Unsafe conditions refer to the mechanical and physical conditions that cause
accidents.
Human Causes: People cause accidents by unsafe acts such as:
Failing to secure equipment
Failing to use safe attire or personal protective equipment
Throwing materials
Operating or working at unsafe speeds - either too fast or too slow
Making safety devices in operative by removing, adjusting, disconnecting
them
Using unsafe equipment or unsafe use of equipment
Using unsafe procedures in loading, placing, mixing, combining
Taking unsafe positions under suspended loads
Lifting improperly
Distracting, teasing, abusing, startling, quarrelling, horseplay
Carelessness, intoxication, daydreaming, inability to do the job, or other
human deficiency
PREVENTIVE MEASURES FOR ACCIDENTS:
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Education
Safety education is aimed at inducing people to 'think safety' and is necessary to
create safety awareness. Popular methods for creating safety awareness include:
Exhibiting easily visible signs that proclaim safety slogans
Placing articles on accident prevention in organisation newsletters
Exhibiting signs e.g. "we have a zero tolerance for accidents".
Skill Training
When employees undergo training, safety issues and preventive techniques
should be discussed especially for new employees.
Protection
People should be provided with protective equipment where necessary.
Examples are safety shoes, gloves, hard hats, safety glasses, and noise mufflers.
Protective maintenance of machinery can avoid fires, explosions, and oil leakage.
Engineering Engineering methods can be used to prevent accidents through both the design
of the equipment and the design of the jobs themselves. When equipment is
being ordered, the type that will best minimise accidents rates should selected
e.g. one, which has specific lighting features.
Equipment design can also consider those elements about the process than can
reduce operator fatigue, boredom, and daydreaming, similarly the position of the
operators relative to the control devices will affect the amount of stooping,
twisting, tension etc - factors that can do increase accident rates
Regulation Enforcement
The safety rules and regulations should be enforced. No smoking signs should be
obeyed; safety helmets always worn in the plant. if the policies are not enforced,
the employer may be liable for any injuries that occur
Reducing Unsafe Conditions
Reducing unsafe conditions is primarily in the domain of safety engineers. Their
task is to remove or reduce physical hazards. This can be done through methods
such as use of better alternatives, use of barriers, warning systems, and personal
protective clothing.
Regularly conducting safety and health inspections – risk assessments are
concerned with the identification of hazards and the analysis of the risks attached
to them. A hazard is anything that can cause harm (e.g. working on roofs, lifting
heavy objects, chemicals, electricity, etc) while a risk is the chance, whether
large or small, of harm actually being being done by the hazard. Selection and Placement
Screening out accident-prone persons can reduce accidents before they are
hired e.g.
People who are visually impaired
Emotional stability and personality tests
Measures of muscular co-ordination
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HEALTH PROGRAMS
1. Alcoholism and Drug Abuse: Alcoholism is a situation whereby employees have excessive drinking habits
while common drugs abused by some employees include Marijuana and
Cocaine. Human resource managers are also expected to deal with these issues.
The effects of alcoholism on the worker and the work can be severe and include
the following.
The quality and quantity of the employees work can decline sharply
"On the job absenteeism" occurs as efficiency declines
Accidents on and off the job increase
The morale of other workers is affected, as they have to do the work of their
alcoholic workmate.
These problems can be solved by:
Disciplinary measures which include oral and written warnings.
Discharging the affected person. This should be done as the last result.
In house counselling
Referral to an outside counselling agency
2. Stress: In order to manage stress effectively, it is important to understand what it is.
stress can be defined as a strain experienced by an individual over a period of
time, which impairs the ability of the individual to perform his/her role
effectively.
Stress is not intrinsically bad. In the absence of any stress, people feel completely
bored and lack any inclination to act. A certain level of stress is manageable as it
prepares individuals to deal with difficult situations, which threaten their well
being. But when the stress level rises to the point where an individual cannot
cope with it, there are harmful results. It important to manage the stress before it
reaches the harmful level.
Normally stress progresses through three stages before it becomes harmful. The
first stage is when the individual is first exposed to the stressful event. It is called
the alarm stage. The individual may experience shock or confusion and his/her
body responds by mobilizing the energy resources including the heart rate,
blood pressure, and alertness. Where the stress does not end immediately, the
individual moves to the second stage which is the resistance stage. This involves
developing defence mechanisms which include aggression (attacking the
stressor directly), regression (adopting a behaviour that was successful at some
earlier time), repression (denying that the stressor exists), withdrawing
physically or psychologically from the stressor, and fixation (persisting in a
response regardless of its effectiveness). When the stress is prolonged, then
exhaustion may result leading to negative effects such as high blood pressure,
anxiety, and mental disorders.
Thus stress can produce severe physical or mental symptoms such as tiredness,
headache, irritability and so on. These can lead people to other problems like
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heavy drinking or excessive smoking which set up a vicious cycle by creating
even worse physical problems.
Ideally there are two types of stress namely psychological stress and
physiological stress. Psychological stress manifests itself into feelings of
emotional distress such as anxiety, excessive worry, and depression.
Physiological stress manifests itself in pain or physical discomforts like
headaches, muscular tension, fatigue, and hypertension and so on. All these
discomforts can be detected early and treated.
Effects of stress to managers
According to Whetten and Cameron (2005) when managers experience stress,
they tend to:
Selectively perceive information and see only that which confirms their
previous biases
Become very intolerant of ambiguity and demanding of right answers
Fixate on a single approach to a problem.
Overestimate how fast time is passing (hence they often feel rushed).
Adopt a short-term perspective or crisis mentality and cease to consider
long term implications.
Have less ability to make fine distinctions in problems, so that complexity
and nuisances are missed.
Consult and listen to others less
Rely on old habits to cope with current situations.
Have less ability to generate creative thoughts and unique solutions to
problems.
The manager becomes less effective in dealing with employees and is also
inefficient at listening, making good decisions, solving problems
effectively, planning, and generating new ideas.
Easily agitated by others.
Victimize employees easily
Become trivial on issues.
Get withdrawn from other people.
Causes of Stress: Different authors have tried to establish what causes stress in individuals.
Nevertheless, the main causes of stress can be categorized into four namely
anticipatory, encounters, time, and situational causes.
Anticipatory stressors are unpleasant things that have not happened but may
happen. They are actually FEARS (false evidences appearing real!). People may
fear losing their jobs or their friends losing their jobs, or they may fear changes
that may arise from organizational changes such as restructuring, or downsizing.
These types of stressors can be reduced or eliminated through the use of the
small wins strategy and goal setting. The small wins strategy is the work of Weick
(1984). It means a series of tiny but definite changes made in a desired direction.
Although each individual success may be relatively modest when considered
alone, the multiple small gains eventually mount up, generating a sense of
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momentum towards the desired goals. Goal setting implies that an individual
must set long term and short term goals.
Encounter stressors result from interpersonal interactions. These interactions
could lead to role conflicts (where roles being performed by group members are
incompatible), issue conflicts (differences that exist over how to define or solve a
problem), and interaction conflicts (where individuals fail to get along because of
antagonism). Encounter conflicts can be minimized by collaboration and team
building as well as emotional intelligence which is the ability to manage one’s
emotions and to manage his/her relationship with others.
Time stressors arise from having too much to do in too little time. They can be
eliminated through efficient and effective time management as well as by
delegating. Managing time effectively means that individuals spend their time on
important matters, not just urgent matters and that people are able to distinguish
clearly between what they view as important and what they view as urgent. It also
means that results rather than methods are the focus of time management
strategies and people have a reason not to feel guilty when they must say “no”.
By managing time effectively, one is able to accomplish more in a typical
workday; it also eliminates feelings of stress and overload that can destroy
personal accomplishments and satisfaction.
All individuals, whether managers or ordinary employees, must learn to manage
their time properly. Some rules that can help someone to manage their time more
effectively include the following:
Read selectively. This applies mainly to individuals who find themselves
with too much material they must read such as mail, magazines,
newspapers, books, brochures, instructions etc.
Make a list of things to accomplish each day. Thus there is need for
advance planning each day so that one does not just rely on memory.
Have a place for everything and keep everything in its place. This is
because when this is not the case, more time is required to find something
when it is needed, and one may be tempted to interrupt the current task to
do something else.
Prioritize your tasks. Each day you should focus on important tasks and
then deal with urgent tasks.
Do one important thing at a time but several trivial things simultaneously.
Make a list of things that are to be done within 5 or 10 minutes which time
would otherwise be spent doing nothing as it may be falling between
meetings, events, talking on the phone and so on.
To avoid feeling overwhelmed by large, important, and urgent tasks, it is
advisable to divide up large projects.
Determine the critical 20% of your tasks which produces 80% of your
desired results.
Save your best time for important matters. Use the rest of the time to do
routine work.
Reserve some time during the day when others don’t have access to you
and spend this time either thinking, or to accomplish important/nonurgent
tasks.
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Don’t procrastinate. By doing certain tasks promptly, it takes less time and
effort than if they had been put off.
Keep track of your time by dividing your activities into time logs to be
accomplished within specified time periods.
Set deadlines because work always expands to fill the available time.
Do something productive while waiting. It is estimated that up to 20% of an
average person’s time is spent in waiting. During such a time, one can try
reading, planning, preparing, rehearsing, reviewing, outlining, or
something else that could help you accomplish your work.
Specify a certain period of time during the day to do busy work.
Reach closure on at least one thing every day.
Schedule some personal time which can be used to plan, prioritize, take
stock, pray, meditate, or just to relax.
Don’t worry about anything on a continuous basis. This ensures that one
does not focus on one thing for too long. It also keeps the mind free and
energy is focused on the present task.
Write down long term objectives. This helps to maintain consistency in
activities and tasks and serves as a constant reminder.
Be alert for new ways to improve on your management of time.
Managers can become more efficient at time management by following the rules
below:
1. Hold routine meetings at the end of the day when energy and
creativity levels are low and when the quitting time ensures that the
meetings are brief.
2. Hold short meetings while standing up to ensure the meeting is
short.
3. Set a time limit for every activity.
4. Cancel meetings once in a while especially where the meetings are
unnecessary.
5. Have agendas, stick to them, and keep track of time during
meetings.
6. Start meetings on time.
7. Prepare minutes of the meetings and follow up.
8. Insist that subordinates suggest solutions to problems so that the
subordinates do not delegate to the manager.
9. Meet visitors in the doorway in order to control your time and the
use of the office space.
10. Go to subordinates offices for brief meetings.
11. Don’t overschedule the day.
12. Have someone else answer telephone calls and scan e-mail.
13. Have a place to work uninterrupted in order to meet deadlines.
14. Do something definite with every piece of paperwork handled.
15. Keep the workplace clean.
16. Delegate work; identify the amount of initiative recipients should
take with the tasks they are assigned, and give others credit for their
success.
Situational stressors arise from the environment in which a person lives or from an
individual’s circumstances. An example would be an unfavourable working
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environment. These stressors can be reduced through work redesign techniques
such as job enrichment, combining tasks, establishing customer relationships,
and open feedback channels.
Other scholars have tried to classify the sources of stress using the following
approaches:
Working conditions - pressure of time at work and high work demands with a
low level of influence and control over the work situation can contribute to
high stress levels.
Work overload - individuals are at risk from stress if they are unable to cope
with the work targets set for them. Good targets should be challenging but
achievable.
Work under load- when employees have very little work to do, they may be
stressed because they may fear the closure of the business. They sometimes
spend the idle time talking and analysing problem after problem. This gives
them more chances to be stressed.
Work role problem - stress may arise where there is role conflict (i.e. when
the individual is called upon to perform different roles at the same time) or
role ambiguity (where a person does not know what is expected of him/her in
the work situation)
Excessive demands of work - some jobs take so much out of the jobholders
such that the job holder is drained of their physical energy and exhausted
Interpersonal conflicts - personal and emotional conflicts with fellow
workers can lead to stress
Poor communications - a lack of good communication can give arise to
frustration and feelings of isolation at work and this can cause stress
Fear of change – job insecurity or fear of the effects of new technology can
give rise to stress. Also the fears of feeling trapped in a dead end job with
little hope of career development can be stressing.
Conflicting loyalties - if an individual has too many bosses all calling for
attention for their instructions, this can give rise to stress
Commuting or travelling through heavy traffic or using overcrowded trains
to and from work can be stressful
Personal circumstances - outside work circumstances/conditions like
divorce, domestic problems, financial problems and so on can interact to
make work conditions more stressful.
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Boredom - underemployment or retirement can cause depression, apathy,
and stress which is contrary to the general perception of overwork being the
prime cause.
In situations where the stress cannot be eliminated, it may be necessary to
develop resiliency which is the ability to withstand the negative effects of stress.
An individual should strive to achieve a fair balance among life’s activities which
can be categorized into physical, spiritual, family, social, intellectual, work and
cultural activities. Such a balance ensures that an individual does not concentrate
on just a single or few aspects of life.
There are three major aspects of resiliency namely physical, psychological and
social resiliencies. The physical resiliency is achieved through cardiovascular
conditioning regular physical exercises and proper dieting that includes eating a
variety of foods and maintaining optimum weight among others.
The psychological resiliency can be achieved by developing hardy personalities,
the small wins strategy, and deep relation techniques. Generally people can be
categorized into personality types A and personality types B. The personality
class in which one falls can determine their response to stressful situations.
Personality Type A refers to those people that set prestigious and high
personal goals and career objectives; they also expect their subordinates and
superiors to behave in this way. In pursuit of these standards, they are
aggressively competitive and extremely hardworking. Because of their high
personal standards, they don't trust subordinates to do the job properly hence
they find it difficult to delegate. This throws extra work pressure on them. They
tend to be inflexible both in their way of working and their view for the structure
and functions of the organisation. Type A people are work oriented (workaholics)
and have few interests outside the work environment itself. The characteristics of
Type A people are likely to exhibit or precipitate the very situation, which leads
to stress. Such people are likely to conflict with other managers and are impatient
with subordinates who criticize superiors.
Personality Type B people are able to relax; they are flexible and more
adaptable. They have empathy in that they can put themselves in other people's
shoes and take account of how others feel. They prefer co-operation to conflict.
They are not so openly ambitious but they achieve the development of their
careers through proper use of their talents. They don't create stress-inducing
situations and so they are less likely to suffer from stress.
Deep relaxation techniques include meditation, yoga, autogenic training or self-
hypnosis, and biofeedback among others. These approaches are also good at
reducing stress among individuals.
Social resiliency involves developing close social relationships with family
members, friends, relatives and other social groups that can cushion an
individual against some negative eventualities.
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Thus generally speaking stress can be managed at the personal level by using
methods such as:
Managing time effectively – poor time management significantly impacts
on stress levels of people. Techniques of time management can be effective in
coping with work overloads. This includes setting realistic goals, deciding on
priorities, finishing one task before starting another, organising work so that you
can find things when they are needed, allowing time for urgent problems and
contingencies.
Taking regular breaks – this enables the employee to refresh their minds
and bodies.
Talking about the problems – employees are often advised to share their
problems with colleagues/friends whom they trust. This will enable them to
get advice and opinions concerning their situations. Perhaps, somebody
has gone through a worse situation than the one being faced by the
employee
Relaxing and exercising - exercise helps to release the stress of the day.
Relaxation may take the form of reading a good book, meditation, yoga, or
even engaging in physical exercises. All these approaches help someone
to control their stress
Doing other things – the employees can establish outside interests (such
as joining social clubs, religious groups etc), which will help to keep them
fresh and creative.
ORGANIZATIONAL LEVEL – MEANS TO MANAGE STRESS Organisations can reduce stress at work by organising the conditions and
requirement s of the work place and the job in such a way as to minimise those
situations which are likely to cause stress. This can include job redesign ( e.g. job
rotation). Moreover, the organization should set realistic targets for the
employees, offer the appropriate training to the employees, carefully select and
place the workers, give the necessary counselling to the employees, and adopt
policies that enable the employees to balance between work life and personal
life. Organisations are expected to be accountable for the damage caused by
stress and other aspects of the health and safety of employees.
3. BURN OUT Excessive stress leads to burnout. Burnout is the total depletion of a person’s
physical and mental resources caused by excessive striving to reach some
unrealistic work related goal. Burnout is often the end result of too much job
stress, especially when that stress is combined with becoming preoccupied with
attaining unattainable work-related goals.
the signs of burnout are inability to relax, identifying so closely with an
individuals activities such that when the activities fail, the individual falls apart,
getting no meaning in the activities that someone worked so hard to achieve,
working more but enjoying the work less, being constantly irritable with family
and friends often commenting that the person looks sickly, and having an
increasing affinity for smoking, liquor, or tranquillisers.
REDUCING BURNOUT
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Prevention – the burnout should be prevented before it begins
Identification – the organisation should set in place techniques for the analysis of
the incidence, prevalence, and characteristics of burnout in individuals, work
groups, sub units or organisations Mediation – these are procedures for slowing, halting, or reversing the burnout
process Remediation – these are techniques for individuals who already burned out or
are rapidly, approaching the end of the stages of this process
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CH. 17: HUMAN RESOURCE PRODUCTIVITY Learning objectives At the end of this chapter one should be able to:
clearly define productivity;
discuss the factors affecting productivity;
elaborate on productivity measures in service and goods producing
organisations;
State the benefits of improved productivity.
Understand and analyse the various approaches that can be used to improve
on the firm’s productivity and competitiveness.
Introduction
Human resource professionals frequently implement strategies for improving
productivity and quality in their organisations. Most of these strategies depend on
employees seeing a link between what they produce and what the firm is
attempting to achieve. Without this relationship, work may be less meaningful,
and ultimately the employee will be less motivated to perform it.
DEFINITIONS OF PRODUCTIVITY
Productivity is the quantity or volume of the major product or service that an
organisation provides. In other words, it is the amount of work that is being
produced in the organisation, in terms of how much and how well.
For most workers, productivity can be determined by calculating a ratio where
by:
Productivity = Output
Input
The most widely used measure of input is worker hours, i.e. the hours
compensated by the employer rather than hours spent at the work place. The
numerator changes according to the work being accomplished i.e. the numerator
can be the number of units that employees produce per hour, the customers
served per day, or the clients contacted per week.
This definition of productivity is particularly appropriate for the private, goods
producing sector because the output can be fairly accurately determined. Thus
the focus of the definition is on efficiency of production.
Managers often rely on measures of productivity to gauge the efficiency of their
departments.
It may be more appropriate to use a broader definition of productivity for
services. This would consider both output efficiency and how effectively a service
accomplishes its goals.
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Generally speaking, productivity is a measure for the output of goods and
services relative to the input of labour, materials, and equipment.
Productivity is defined as measures or indicators of output of an individual, group
or, organisation in relation to inputs or resources used by the individual, group,
or organisation for the creation of the outputs.
FACTORS AFFECTING PRODUCTIVITY
High productivity is what makes an organisation thrive. Common productivity
measures Include the number of calls per day, the number of completed projects,
the number of customs handled each day, and the sales cycle time.
An organisation without a good product or service to sell will have many
problems.
Productivity is affected by five major factors namely:
1. Capital investment
2. Innovation
3. Learning
4. Motivation
5. Readiness to change
1. Capital Investment
It includes having the best possible machinery available that will help to improve
the efficiency of the workers. The machinery or equipment can be in many forms,
from robots to word processors. The concept behind capital investment is to
provide the latest technologically advanced equipment that will help the workers
to work smarter, not harder.
2. Innovation
It is a process whereby new and creative ideas are welcomed, studied for their
feasibility, and, it feasible, implemented. The idea for an innovation can come
from a number of sources such as the employees, among customer complaints
and suggestions among others.
3. Learning
Learning looks at training issues. The aim is to make individuals to work
effectively (doing the right things) and efficiently (doing the things right).
To be effective and efficient in their work, employees must have the proper skills;
and in many cases, these skills have to be taught - especially the skills needed to
use a new piece of equipment.
4. Motivation
A best trained employee with the ability and access to the most advanced piece
of equipment will not be productive If he/she is unwilling to be so. Attitude plays
an important role as to whether an individual has the propensity to work. Thus it is
necessary to increase the employee’s motivation as one way of increasing
productivity.
Productivity improvements can be achieved through a series of events as shown
above. Besides the workers' ability to accept and implement changes is an
important consideration.
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5. Readiness to change
Change is a fact of life whether the individuals private or work life. In some cases,
change may be resisted. A secretary who has been used t a typewriter may resist
changing from the typewriter to a word processor. Indeed the fear associated
with a possible threat to job security could negate any advantage that might
accrue by automating an office because this fear might manifest itself as
decreased morale.
Employers must make changes to remain competitive. They must identify why
changes are necessary and lend their total support in ensuring that the change
takes place. The support can be in the form of time allowed to introduce a new
system, time allowed for training, and decreased production allowed while the
employees are being trained, as well as supporting the change by budgeting
monies so that the complete change can be made. All these will create a work
atmosphere that views change as a positive and progressive endeavour.
PRODUCTIVITY FOR SERVICE ORGANIZATIONS
Defining productivity for service organisations is not easy because while out put
per hour could be measured by the number of customers served, the output in
service organizations may be influenced by other non quantitative variables.
Productivity naturally increases when more output is derived from the same input
or when the same output is derived from decreased input. In practice, the goals
of most service organisations is to provide the fastest, most efficient, and
friendliest service possible to any and all customers. In terms of productivity, this
may mean that minimising errors, eliminating reworking, smiling and offering to
go the extra mile for a customer is stressed. In any, case, the idea is to make the
service industry more productive by having better-serviced customers.
BENEFITS OF IMPROVED PRODUCTIVITY
Improving productivity simply means getting more out of what is put in, not
increasing production through the addition of resources like time, money,
materials or people. It is doing better with what you have.
Improving productivity is not working harder; it is working smarter. In fact,
today's world demands that we do more with less - fewer people, less money, less
time, less space, and fewer resources in general. More productive organisations
get more goods and service out of a given amount of labour, capital, and
equipment than do less productive organisations.
Enhanced productivity is a goal in plans for employee training, more
participative styles of administration, changes in organisation, personnel
appraisal systems, and programs to improve morale and communications, and
revised systems of compensation.
Productivity increases make it possible for wages to be increased without raising
unit labour costs and the prices of goods and services i.e. businesses can pay
higher wages without boosting inflation. This improves the standards of living for
the workers.
The more productive an industry is, the better its competitive position because its
unit costs are lower.
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APPROACHES OF IMPROVING PRODUCTIVITY AND COMPETITIVENESS
a. Employee Involvement:
It provides employees with greater amounts of four key components namely
power, information, knowledge, and rewards
Power is shared downward by various mechanisms for obtaining employee in put
into decisions. These may include quality circles or other forms of work
improvement teams; suggestion systems, job enrichment and even self managed
work teams.
Information about the business is widely shared with employees, so that they
have the understanding and background to contribute to decision making in the
organisation, and information about the company's competition.
Knowledge is enhanced by additional job skills training, cross-training on related
jobs, and teamwork training to allow employees to handle more complex jobs,
decision making responsibilities, and team-oriented work.
Reward systems are modified to provide incentives for becoming skilled and
committed to the company's overall effectiveness. Pay for skills systems are
common, to reward learning additional jobs within the team, and a focus on the
company's success is achieved with profit sharing, gains sharing, or employee
stock ownership programs.
Organisations vary in the level of involvement of employees.
b. Lean Production systems
This involves making use of small teams of multi-skilled workers who are rotated
and enriched/empowered to find better ways of doing their job. This idea is used
in Japan by Toyota and Mazda Corporations but the idea originated from Henry
Ford of the famous Ford Motor Company (USA).
c. Total Quality Management
Total Quality Management has been clearly enunciated by experts such as Philip
Crosby, Joseph Juran, W. Edward Deming, Armand Feigenbaum, and Genichi
Taguchi
These ideas were adopted and mastered by the Japanese and later spread to
American Companies. Some of the common principles underlying Total Quality
Control approaches are:
Customer-first orientation (both internal and external customers)
Top management leadership Commitment to the quality improvement
process
Focus on continuous improvement
Respect for employees and their knowledge; employees are actively
involved in the improvement process
Reduction of product and process variations
Provision of on- going education and training to employees
Familiarity with a statistical way of thinking and the use of statistical
methods throughout the organisation
Emphasis on prevention rather than detection
View of vendors as long term partners
Performance measures that are consistent with the goals of the organisation
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Product or service quality that begins with its definition and design
Co-operation and involvement of all functions within an organisation
Awareness of the needs of internal customers
Substantial cultural change
d. Business Process Improvement
Generally attributed to IBM, Business Process Improvement is a set of practices
for regularly examining and improving the processes that go on in an
organisation.
A process is a repeated set of activities, often carried out in sequence by several
departments that adds value and produces measurable outputs e.g. billing,
distribution, materials management, and procurement.
In a traditional approach to quality, each department involved in a process would
try to do its portion of the activity more quickly and accurately, but the entire
process from start to finish is unlikely to be critically evaluated or redesigned.
Business process improvement is also called "re-engineering" and may involve
benchmarking whereby an organization compares itself with other organization
in the same or in different industries. After a benchmarking exercise, the firm
may need to adopt some of the best practices of the leading firms.
e. Work Improvement Teams (Quality Circles)
Quality control circles consist of 7-10 volunteers from the same work area who
meet regularly to define, analyse and solve quality related problems in their
areas such as conditions under which people do their jobs, efficiency at work, job
satisfaction, and influence of technology among other factors. Membership to the
quality circle is voluntary and there are no payments for being a member of the
group.
An organisation may have several quality circles operating simultaneously, each
dealing with a particular work area. The members of the quality circle should be
trained on problem solving techniques.
Quality circles are very effective in the short run. However, they are less effective
at creating more permanent changes. They do not alter the nature of the
employees’ jobs and only provide the opportunity to make suggestions and
decisions on how to improve the job.
f. Self Directed Work-Teams:
These are also called "self managed work teams” or” autonomous work groups".
The team is given responsibility to produce a product or service.
The team makes most of the production decisions such as scheduling, assigning
work, deciding on methods, selecting new members, doing performance
evaluations, and allocating pay increases. The team is such that there is no
supervisor, but there may be an elected team leader.
Management is responsible for providing information to the group on costs,
quality, output requirements, and any other technical assistance that is requested.
When this concept is used throughout much of the organisation, the result is
called a "high involvement organisation".
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g. Financial Incentives:
Examples of incentive systems are Commissions and pay for skills possessed
rather than skills required.
h. Suggestion Systems
these systems enable employees to raise valuable suggestions for improvement
or even to make complaints. An example is the suggestion box.
i. Behaviour Modification:
Positive reinforcements can be used to improve needed behaviour. Possible on
the job rein forcers include social reinforces ( e.g. verbal praise, special job title,
recognition in front of co workers, notes of thanks, picture in company paper,
pats on the back and greetings from boss); Material rein forcers ( awards, fringe
benefits, special badges or insignias, pay raises and bonuses, large offices and free tickets to sporting events); Special Privileges ( own parking space, longer
lunch breaks, birthday off, longer coffee breaks, flexible work schedules,
training for better jobs and earned time off); token reinforces include telephone
credit cards, points backed by prizes, coupons redeemable at local stores, and
chances to win prizes (lottery).
i. Goal setting:
This is a proven technique, which is highly successful for improving motivation
and job performance.
It is effective with employees as diverse as managers and professionals, sales
people and hourly workers like tree planters and truck drivers.
Effective goals have four characteristics
The goal must be difficult but not impossible to accomplish
The goals must be specific and measurable
The employee who then must strive to meet them must accept the goals
Feedback is necessary for goals setting to be effective over time.
Setting specific goals clarifies what behaviours are desired hence ambiguity in
one’s role is removed.
Specific and difficult goals with feedback allow people to receive motivational
respect for meeting their goals.
j. Quality of work life programs
Quality of work Life (QWL) is defined as a process buy which all members of the
organisation have some say in decisions that affect their jobs in particular and the
work environment in general, resulting in greater job involvement and
satisfaction and reduced levels of stress. They have the following characteristics.
1. Sustained commitment by management to participation by employees at all
levels in the organisation in the design, implementation, and regards of their
work.
2. Encouraging continuous learning and training toward development of
personal skills and knowledge.
3. Restructuring jobs to make them most challenging.
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4. Training supervisors toward a more participative, supportive and
collaborative style.
5. Promoting an atmosphere of open communication and trust between
management and the workforce.
6. Providing feedback on and recognition for results achieved.
k. Job Rotation
This is a technique used to enhance employee motivation and productivity. It
involves periodically assigning employees to alternating jobs or tasks
The rationale behind job rotation is that since different jobs require different skills the
intrinsic reward potential of the job will increase. Job rotation does not, however, solve
the problem of boringly repetitious jobs. This is because the depth of the job does not
change, as the jobs are similar. Nevertheless, it gives managers a means of copying with
frequent absenteeism and high turnover.
Job rotation is often effectively used as a training technique for new,
inexperienced employees. At higher organisational levels, rotation also helps
develop managerial generalists because it exposes them to several different
operations.
l. Job Enrichment
This is mainly used by organisations with employees who have high levels of
knowledge and skills. Employees love their jobs if the work is meaningful, the
worker has knowledge of operating results, and the worker is personally
responsible for the results.
Meaning can be placed into a job by providing for skill variety, task identity, and
task significance.
Opening feedback channels to the worker can affect knowledge of operating
results, and if the employee is granted some degree of discretion and autonomy
over the job, that workers sense of responsibility is increased.
Typically the worker decides how the job is performed, planned and
controlled and makes decisions concerning the entire process. The overall
purpose is to improve a job by making it more exciting and challenging.
Job enrichment requires a lot of commitment and planning by top level
management, retraining of employees, and substantial changes in leadership
styles of the supervisors and managers.
m. Job Enlargement
It involves expanding the number of tasks or duties assigned to a given job.
However, the additional tasks or duties typically require no new skills and are
very similar to the previous ones
Through job enlargement, a previously monotonous job remains monotonous
(only a larger scale before). It has achieved little success in motivating
employees.
n. Flexi-Times
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This is a German innovation. Under a flexitime system, employees are allowed
to vary their daily work schedules as long as the required number of hours is
worked each week.
Other approaches of improving productivity and competitiveness include
collective goal setting, redesigning jobs, telecommuting, and using status
symbols such as the design of the office, the type of car driven, and the kind of
house lived in.
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CH.18: PERFORMANCE APPRAISAL
Introduction Performance appraisals are part of the broader field of performance
management. It is therefore necessary to understand performance management
in order to fully understand performance appraisal
Performance management can be defined as a strategic and integrated
approach to delivering sustained success to organisations by improving the
performance of the people who work in them and by developing the capabilities
of teams and individual contributors (Armstrong and Baron, 1998).
The purpose of Performance management is to get better results from the
organisation, teams and individuals by understanding and managing
performance within an agreed framework of planned goals, standards and
competence requirements. It is a process for establishing shared understanding
about what is to be achieved, and an approach to managing and developing
people in a way that increases the probability that the goals of the organisation
will be achieved in the short run and also in the long run.
There are many tools that are used to improve performance and which are the
subjects of the performance management process. Some of them include the use
of the Balanced Score Card, performance contracts and performance appraisals.
1. Definition of Performance Appraisal (PA):
Performance Appraisal (PA) has been defined variously by different authors.
Glüeck (1978) defines PA as a personal activity by means of which the enterprise
determines the extent to which the employee is performing his/her job
effectively.
Jeffrey Gold (2003) defines PA as a process that provides an analysis of a person’s
overall capabilities and potential allowing informed decisions to be made for
particular purposes.
Graham (1999) defines PA as “the judgement of an employee’s performance in a
job, based on considerations other than productivity alone. It is sometimes called
merit rating, especially when it is to discriminate between employees in granting
increases in wages or salaries”.
Fisher (1996) says PA is the process by which an employee’s contribution to the
organisation during a specified time is assessed. It lets the employees know how
well they have performed in relation to the standards of the organisation.
Performance appraisal refers to the systematic description of the job-related
strengths and weaknesses of an individual or group (Gerald R. 2002: 19-20).
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It has also been defined as the systematic evaluation of the individual with
respect to his performance on the job and his potential for development (Beach,
1975).
Different firms use various terms to describe this process. Some of the commonly
used terms include performance review, annual appraisal, performance
evaluation, employee evaluation, and merit evaluations.
Benefits of performance appraisals
Performance Appraisal is normally done for some or all of the following reasons:
a. Performance evaluations assist decision-makers to determine who should receive
pay increases, transfers, promotions, demotions or retrenchment. Often,
promotions are a reward for past performance. Many firms actually grant part or
all of their pay increases and bonuses based upon merit, which is determined
mostly through Performance Appraisal
b. The performance feedback allows the employee, manager, and personnel
specialists to intervene with appropriate actions to improve performance. Poor
performance may indicate the need for retraining while good performance may
indicate untapped potential that should be developed
c. The performance feedback also guides career decisions about specific career
paths that one should investigate
d. Performance appraisal assists the personnel department in evaluating its
activities. Good or bad performance implies strengths or weaknesses in the
personnel department’s staffing procedures. Similarly poor performance may
indicate errors in job analysis information, Human Resource plans, or other parts
of the Personnel Management's information system. Reliance on inaccurate
information may have led to inappropriate hiring, training or counselling
decisions. Appraisals help diagnose errors in job designs
e. Sometimes performance is influenced by factors outside the work environment.
These factors may include the family, financial, health or other personal matters.
If uncovered through appraisals the personnel department may be able to
provide assistance.
f. Performance Appraisal provides the basis for validation of prediction used in
internal and external selection as well as placement.
g. Performance Appraisal may be used to weed out marginal or low performing
managers and to serve as a basis for modifying behaviour toward more effective
performance.
Performance appraisals should be held regularly. Holding regular informal one-
to-one review meetings greatly reduces the pressure and time required for the
annual formal appraisal meeting. Holding informal reviews every month is ideal
for all staff. There are several benefits of reviewing frequently and informally:
The manager is better informed and more up-to-date with his or her
people's activities (and more in touch with what lies beyond such as the
customers, suppliers, competitors, markets, etc).
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Difficult issues can be identified, discussed and resolved quickly, before
they become more serious.
Help can be given more readily. People rarely ask unless they see a good
opportunity to do so. The regular informal review provides just this
opportunity.
Assignments, tasks and objectives can be agreed completed and reviewed
quickly. Leaving actions more than a few weeks reduces completion rates
significantly for all but the most senior and experienced people.
Objectives, direction, and purpose is more up-to-date. Modern
organizations demand more flexibility than a single annual review allows.
Priorities often change through the year, so people need to be re-directed
and re-focused.
Training and development actions can be broken down into smaller more
digestible chunks, increasing success rates and motivational effect as a
result.
The 'fear factor', often associated by many with formal appraisals is greatly
reduced because people become more comfortable with the review
process.
Relationships and mutual understanding develops more quickly with
greater frequency of meetings between managers and staff members.
Staff members can be better prepared for the formal appraisal, giving
better results, and saving management time.
Much of the review has already been covered throughout the year by the
time the formal appraisal comes.
Frequent review meetings increase the reliability of notes and
performance data, and reduces the chances of overlooking things at the
formal appraisal.
Performance appraisals process
Prepare - prepare all materials, notes agreed tasks and records of
performance, achievements, incidents, reports etc - anything pertaining to
performance and achievement. This includes the previous performance
appraisal documents and a current job description. A good appraisal form
will provide a good natural order for proceedings. Organize your
paperwork to reflect the order of the appraisal and write down the
sequence of items to be covered. If the appraisal form includes a self
assessment section and/or feedback section (good ones do) ensure this is
passed to the appraisee suitably in advance of the appraisal with relevant
guidance for completion.
Inform - inform the appraisee. Ensure the appraisee is informed of a
suitable time and place (change it if necessary), and clarify purpose and
type of appraisal. Give the appraisee the chance to assemble data and
relevant performance and achievement records and materials. If the
appraisal form does not imply a natural order for the discussion then
provide an agenda of items to be covered.
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Venue - ensure a suitable venue is planned and available which is private
and free from interruptions
Layout - room layout and seating are important elements to prepare also.
Layout has a huge influence on atmosphere and mood. irrespective of
content, the atmosphere and mood must be relaxed and informal. It is
therefore necessary to remove barriers. Sitting at an angle to each other,
90 degrees ideally, is recommended in order to avoid face to face contacts
which are confrontational.
Introduction - relax the appraisee. Open with a positive statement, smile,
and be warm and friendly. The appraisee may well be terrified; it's your
responsibility to create a calm and non-threatening atmosphere.
Review and measure - review the activities, tasks, objectives and
achievements one by one, keeping to distinct separate items one by one.
Avoid going off on tangents or vague unspecific views.
Agree an action plan - An overall plan should be agreed with the
appraisee, which should take account of the job responsibilities, the
appraisee's career aspirations, the departmental and whole organization's
priorities, and the reviewed strengths and weaknesses. The plan can be
staged if necessary with short, medium and long term aspects, but
importantly it must be agreed and realistic.
Agree specific objectives - These are the specific actions and targets that
together form the action plan. As with any delegated task or agreed
objectives these must adhere to the SMARTER rules - specific, measurable,
agreed, realistic, time-bound, enjoyable, recorded.
Agree necessary support - This is the support required for the appraisee
to achieve the objectives, and can include training of various sorts
(external courses and seminars, internal courses, coaching, mentoring,
secondment, shadowing, distance-learning, reading, watching videos,
attending meetings and workshops, workbooks, manuals and guides;
anything relevant and helpful that will help the person develop towards the
standard and agreed task).
Invite any other points or questions - make sure you capture any other
concerns.
Close positively - Thank the appraisee for their contribution to the
meeting and their effort through the year, and commit to helping in any
way you can.
Record main points, agreed actions and follow-up - Swiftly follow-up the
meeting with all necessary copies and confirmations, and ensure
documents are filed and copied to relevant departments, (HR, and your
own line manager typically).
The following theoretical framework also summarises the performance appraisal
process.
THE PERFORMANCE APPRAISAL PROCESS:
Establish performance standards with employees e.g. target sales of $500,000
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Who Conducts the Performance Appraisal Process?
1. The Supervisor (or Person In Charge)
The rating of employees by supervisors is based on the assumption that the
supervisor is the most qualified person to evaluate the employee’s performance
realistically, objectively, and fairly. The supervisor is normally the best person to
observe the employee’s behaviour and determine whether the employee has
reached specified goals and objectives or not. This is because the supervisor has
direct contact with the employee.
To ensure that the judgement is objective and based on actual performance the
supervisor should keep records of each employee’s performance. The
supervisor’s appraisal should be reviewed by his/her manager to make sure the
supervisor has done a proper job of appraisal, and that any rewards
recommended are justified.
Supervisors often prefer to avoid the appraisal process because of uncomfortable
face to face confrontations that often result. Policy makers should however ensure
that performance appraisals are conducted in a professional manner because
appraisals of subordinates are a legitimate and critical part of supervision.
2. Peer Evaluations
These are often called “buddy ratings” and are used where an employee is
working with other employees in a non-competitive work group environment.
Quite often peers provide information that the organisation cannot get from the
supervisor. Each group member rates every other group member on a
recognisable quality like leadership. The group members either assigns the
Set mutually measurable goals
Measure actual performance e.g. actual sales achieved $300,000
Compare actual performance with standards and note deviations
Discuss the appraisal with the employee
Initiate corrective action, if necessary
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others a score or they nominate a specified number of fellow workers whom they
consider high or low in the quality being measured.
Peer evaluations work best when:
They are limited to people who see themselves as similar/ equals
The peer rates work best when fellow workers have had the opportunity to
see the other person perform tasks, and know who is good at what job
Peer rates work best when more objective sources of feedback are
lacking, and
Peer rates work best where there is no probability of retaliation
However, peers will often not give objective, honest appraisals because of fear of
possible retaliation. Further, researches indicate that factors such as race may
have more of a biasing effect when co-workers rate an employee than when a
supervisor does the rating.
3. Customer/ Client Evaluations
Client/ Customer Evaluations are commonly used in service-related jobs, where
the customer evaluates the employee.
Specialised customer questionnaires, telephone follow up surveys, and other
techniques are used in addition to comment cards to try to get the customer's
evaluations of the employee’s performance.
However, Client/ Customer Evaluations are usually incomplete because they only
give a part of the employee’s performance, because the client is usually with the
employee for a short period of time (unlike the supervisor).
4. The Group Summary Appraisal
Here a committee of managers is invited to assess a subordinate's performance
and possible means of improvement. The points on which all agree constitute the
appraisal.
Disadvantages:
a. It can be a cumbersome and time consuming process
b. The Committee Chairperson can influence the outcome of the appraisal
exercise.
c. Employees may perceive the Committee as being unfair
d. The Committee members may not realise that the performance
appraisal is not meant to crucify employees, but rather, help in
developing them
e. The results can be compromised. unfortunately, groups don’t always
come up with the best appraisals.
5. Self Ratings
Self-ratings are not to judge the person but to encourage employee development,
build genuine teamwork, and to connect job performance with company goals
especially for white-collar employees.
Self-Rating is a self-development tool that forces employees to think of their
strengths and weaknesses and set goals for improvement. It is also used where an
employee is working in isolation or possesses unique skills, etc.
6. Reverse Appraisals
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These are also called upward evaluations, where the employees/ subordinates
rate the supervisor. Employees are given the opportunity to give a direct, formal
feedback to their supervisors on their managerial performance; e.g. students
may rate professors in Universities or Colleges. The results are used to help
superiors improve themselves or organisations to assess the managerial
leadership potential.
Advantages:
a. Where the subordinate/ executive relationship is crucial for success, the
subordinates can be used to identify competent supervisors. An example is in
combat situations that may lead to life or death of the members.
b. The rating can also help the superior become more responsive to
employees as long as the superior does not become “nice” because “nice”
people may not be effective.
Disadvantages:
a. Fears of Retaliation – many supervisors/eExecutives have negative
reactions to being appraised by their employees/ subordinates. This fear may be
too great for employees to give realistic ratings b. Employee Resistance – many employees may resist rating their bosses
because they may not perceive it as a proper part of their job.
c. The workers may rate the superior only on the way the superior treats
them, and not on critical job requirements.
It should be noted that most organisations don’t use reverse ratings except for
self-improvement purposes. In order to be meaningful, such evaluations must
identify particular strengths and weaknesses, rather than consist of vague
comments. Anonymity is necessary unless there is a high level of trust at the work
place. Finally, the fear of retaliation must be eliminated for this employee voice
mechanism to be effective.
7. Outside Raters
Outside experts may be called to review the work of say, the Chief Executive
Officer or a College President. Outside reviewers provide managers with
professional assistance in making appraisals.
However, the outsider may not know all the important contingencies in the
organisation. The process is also time consuming and expensive.
8. The Multiple Rating System
This merely requires several superiors to separately fill-out forms on the same
employee. The results are then tabulated. Such rating of employees is especially
appealing when the preservation of organisation is important.
9. The 360 Degree Feedback/ Appraisal System
Also called the “all-round” appraisal system, since ratings are collected all
around from employees to superiors to subordinates, peers, internal or external
customers, etc. Internal customers refer to one department being the customer of
the other, e.g. the purchasing department is a customer of the marketing
department.
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Performance appraisal Methods
The appraisal method will depend or vary from organisation to organisation and
the people to be appraised. The appraisal can be targeted to executives,
managers, professionals, technical personnel, clerical staff etc.
The following factors should be considered when selecting the PA method:
1. The costs of developing and implementing the method
2. The beneficial effects of the method on personnel research and test validation
3. The effectiveness of the method in facilitating decision making on promotions,
transfers, discipline, training and compensation
4. The usefulness of the method in conveying the organisations' goals and
expectations to the employees as well as for employee development
The performance itself may be objectively or subjectively appraised. Objective
measures of performance may include production figures whereby a production
standard is first established and the employees measure of output is judged
against the standard. This is an attractive and straightforward measure of
performance.
The number of accidents and the number of times one is late or absent are other
objective measures of performance. Judgmental methods are subjective in that
they rely on individual assessments - usually by supervisors and include rating
systems, ranking systems and paired comparisons.
The Steps in Developing a Performance Appraisal System:
Determine Performance Requirements
Choose an Appropriate Appraisal Method
Train Supervisors
Discuss Methods with Employees
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THE METHODS OF PERFORMANCE APPRAISAL
The diagram below shows some of the Appraisal methods commonly used:
Each of these methods has its own combination of strengths and weaknesses, and
none is able to achieve all the purposes for which management institutes
performance appraisal systems. Nor is any one technique able to evade all of the
pitfalls. The best approach is to match an appropriate appraisal method to a
particular performance appraisal goal.
The most commonly used appraisal techniques include:
1. Essay appraisal
In its simplest form, this technique asks the rater to write a paragraph or more
covering an individual's strengths, weaknesses, potential, and so on. In most
selection situations, particularly those involving professional, sales, or
managerial positions, essay appraisals from former employers, teachers, or
associates carry significant weight. The assumption seems to be that an honest
and informed statement -either by word of mouth or in writing- from someone
who knows a person well, is fully as valid as more formal and more complicated
methods.
Performance Appraisal Systems
Rating Scales
Comparative Methods
Combination methods
Critical Incidents
Essay MBO Check List Methods
Appraise According To Job Standards
Discuss Appraisal with Employees
Determine Future Performance Goals
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The biggest drawback to essay appraisals is their variability in length and
content. Moreover, since different essays touch on different aspects of a man's
performance or personal qualifications, essay ratings are difficult to combine or
compare. For comparability, some type of more formal method, like the graphic
rating scale, is desirable.
The essay method reduces supervisory bias, halo effect, central tendency and
leniency problems. However, the supervisor may spend formidable time writing
separate essays about each employee. Further essays are not very useful for
evaluative purposes as no common standard exists.
Another drawback is the appraiser’s ability to write. A good writer will earn the
appraisee more marks while a poor writer who may be appraising a good worker
may make the employee to earn low marks due the inability to write.
2. RATING SCALES
Rating scales are satisfactory for most evaluation purposes because they provide
a mathematical evaluation of the employees' performance, which can be used to
justify compensation or job changes and to validate selection instruments.
a. The Graphic Rating Scale:
This involves using a scale to measure or gauge an employee’s relation to a
certain attribute such as using initiative, punctuality, reliability, ability to meet
targets. Questions are formulated and each question would then have a numerical
scale alongside it, similar to the one below:
Never
(0%)
Rarely/
Seldom
(25%)
Half the
Time/
Sometimes
(50%)
Usually
(75%)
Always
(100%)
For operative staff, typical qualities rated are:
Quality and quantity of work
Job knowledge
Cooperativeness
Dependability
Initiative
Industriousness
Attitude
For management personnel, typical factors are analytical ability, decisiveness,
creative ability, leadership, initiative, job performance, co-ordination, and
emotional stability.
The assessor gives the employee a score which most closely approximates his
degree in relation to the question(s) and a total score is arrived at by adding
together all of the individual item scores on the appraisal form. Although this
method is quick and requires little training, it is prone to rater errors.
This technique may not yield the depth of an essay appraisal, but it is more
consistent and reliable. Typically, a graphic scale assesses a person on the
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quality and quantity of his/her work (is he outstanding, above average, average,
or unsatisfactory?) and on a variety of other factors that vary with the job but
usually include personal traits like reliability and cooperation. It may also include
specific performance items like oral and written communication.
The graphic scale has come under frequent attack, but remains the most widely
used rating method. It is cheaper to develop and more acceptable to raters than
the forced-choice form. For many purposes there is no need to use anything more
complicated than a graphic scale supplemented by a few essay questions.
b. Non-Graphic Rating Scales
Non-graphic scales may be used when an explanation may need to be given to
justify the point raised, e.g. with regard to punctuality
Never
(0%)
Rarely/
Seldom
(25%)
Half the
Time/
Sometimes
(50%)
Usually
(75%)
Always
(100%)
Comment on your response with regard to punctuality
_______________________________________
___________________________________________________________________________
___
Non-graphic scales are more valid than graphic rating scales as they contain a
brief description of each point on the scale rather than simply high and low points
of a scale. The rater can give a more accurate description of the employee’s
behaviour on a particular attribute because a description clarifies each level of
the rating scale. It is a quick and less difficult method for supervisors to use.
c. Bars or Behaviorally Anchored Rating Scales
This method is designed to assess behaviour required to successfully perform a
job. The assumption is that personal behaviour will result in required
performance. Most bars use the term job dimension to mean those broad
categories of behaviour that make up a job. Each job will have several bars.
Bars are developed through the active participation of both managers and job
holders therefore increasing the likelihood of the method being accepted.
However, it takes time and commitment to develop different bars for different
jobs.
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3. Field review
When there is reason to suspect rater bias, or when some raters appear to be
using higher standards than others, or when comparability of ratings is essential,
essay or graphic ratings are often combined with a systematic review process.
The field review is one of several techniques for doing this. A member of the
personnel or central administrative staff meets with small groups of raters from
each supervisory unit and goes over each employee's rating with them to (a)
identify areas of inter-rater disagreement, (b) help the group arrive at a
consensus, and (c) determine that each rater conceives the standards similarly.
This group-judgement technique tends to be fairer and more valid than individual
ratings and permits the central staff to develop an awareness of the varying
degrees of leniency or severity -as well as bias- exhibited by raters in different
departments. On the negative side, the process is very time consuming.
4. Comparative Methods
They avoid the problem of central tendency or crowding employees in some
groups. They include:
a. Ranking (Individuals)
Employees are ranked on a certain attribute e.g. leadership skills, or on their
sales performance.It involves rating individuals by arranging them according to
merit, from the best to the poorest in terms of a specific characteristic or of
overall performance. No ties or balanced scores are allowed.
Advantages:
1. It is fast and easy to complete where few employees exist
2. A numerical evaluation given to the employees can be directly related to and
used to make other decisions such as compensation changes or staffing
considerations
Disadvantages:
1. It is not developmental because employees do not receive feedback about
their performance with regard to strengths, weaknesses or future direction
2. It assumes all employees in the organisation can be ranked from the best to
the worst
3. There is no common standard of performance by which to compare
employees from various departments
For comparative purposes, particularly when it is necessary to compare people
who work for different supervisors, individual statements, ratings, or appraisal
forms are not particularly useful. Instead, it is necessary to recognize that
comparisons involve an overall subjective judgment to which a host of additional
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facts and impressions must somehow be added. There is no single form or way to
do this.
Comparing people in different units for the purpose of, say, choosing a service
supervisor or determining the relative size of salary increases for different
supervisors, requires subjective judgment, not statistics. The best approach
appears to be a ranking technique involving pooled judgment. The two most
effective methods are alternation ranking and paired comparison ranking.
Alternation ranking: In this method, the names of employees are listed on the
left-hand side of a sheet of paper - preferably in random order. If the rankings are
for salary purposes, a supervisor is asked to choose the "most valuable"
employee on the list, cross his/her name off, and put it at the top of the column on
the right-hand side of the sheet. Next, he/she selects the "least valuable"
employee on the list, crosses his/her name off, and puts it at the bottom of the
right-hand column. The ranker then selects the "most valuable" person from the
remaining list, crosses his/her name off and enters it below the top name on the
right-hand list, and so on.
b. Paired-comparison ranking:
Raters here pair employees and choose one as superior in overall job
performance. The employee is given a positive comparison total and a certain
percentage of the total positive evaluation as follows:
The No. of comparisons will be = N (N-1) (where N = population)
2
While the method is quick and easy where few (2 at a time) employees are being
rated, it is time consuming where many employees are being rated. Moreover,
employees are compared to each other on overall performance rather than on
specific job criteria.
Both ranking techniques, particularly when combined with multiple rankings (i.e.,
when two or more people are asked to make independent rankings of the same
work group and their lists are averaged), are among the best available for
generating valid order-of-merit rankings for salary administration purposes.
c. Forced Distribution:
The supervisor is forced to distribute the employees to pre-determined groups
like 10% should be excellent, 20% good, 40% average, 20% below average and
10% very poor.
Like the field review, this technique was developed to reduce bias and establish
objective standards of comparison between individuals, but it does not involve
the intervention of a third party. Although there are many variations of this
method, the most common one asks raters to choose from among groups of
statements those which best fit the individual being rated and those which least fit
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him/her. People with high scores are, by definition, the better employees; those
with low scores are the poorer ones. Since the rater does not know what the
scoring weights for each statement are, s/he cannot play favorites. He simply
describes his people, and someone in the personnel department applies the
scoring weights to determine who gets the best rating.
The rationale behind this technique is difficult to fault. In practice, however, the
forced-choice method tends to irritate raters, who feel they are not being trusted.
An additional drawback is the difficulty and cost of developing forms.
Consequently, the technique is usually limited to middle and lower management
levels where the jobs are sufficiently similar to make standard or common forms
feasible.
Finally, forced-choice forms tend to be of little value- and probably have a
negative effect- when used in performance appraisal interviews.
The practice of forced distribution is that job performance is the basic factor in
determining an employee’s value to an organisation and that other elements like
co-operation and personality are worth considering only in so far as they
contribute to performance.
5. The Critical Incidents Method:
Supervisors first collect critical incidents that reflect especially favourable job
performance (such as completing a major assignment a head of schedule) and
then they scale the incidents. Lastly they construct the checklist scale.
Scaling incidents involves presenting the incidents to a group of people who are
familiar with the job in question who then assign scale values to each incident
according to its assessed desirability.
The checklist scale is drawn up containing only those items judged to indicate
'good' or 'poor' performance on the job. Workers are rated according to whether
or not they have shown any of the incidents/behaviours listed and a total score
calculated.
Advantages:
1. The method does not involve complicated statistical procedures. It is
concerned with actual on the job behaviours, which have been observed in
particular organisational circumstances
2. Supervisors are only required to indicate whether or not workers have or have
not been observed to behave in a particular way as opposed to being forced
to make judgements/rankings of the personal characteristics f their
subordinates.
Here the evaluator uses the most memorable incidence associated with the
employee whether they happened recently or sometimes ago. For instance:
always reporting to work in time, finishing a major assignment ahead of time etc.
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There are, however, several drawbacks to this approach. It requires that
supervisors jot down incidents on a daily or, at the very least, a weekly basis. This
can become a chore. Furthermore, the critical incident rating technique need not,
but may, cause a supervisor to delay feedback to employees.
Finally, the supervisor sets the standards. If they seem unfair to a subordinate,
might he not be more motivated if he at least has some say in setting, or at least
agreeing to, the standards against which s/he is judged.
6. Management by objectives (MBO)
Management by Objectives (MBO) is a developmental approach to performance
appraisal. Developmental approaches offer specific, goal oriented, jobs related
guidelines and behaviour for performance improvement.
MBO Involves the Following Steps:
Performance planning: The employee and supervisor mutually establish
a list of goals designed to accomplish the needs of the business, further
develop the employee and broaden his/her basic responsibilities. The
objective should be quantifiable and measurable, challenging yet
achievable, expressed in writing and in clear, concise and unambiguous
language, and the employees should participate in the setting them. The
objectives and action plans must serve as a basis for regular discussions
between the manager and the employee. Developing an action plan indicating how these objectives are to be
achieved Allowing the employee to implement the action plan
Review: Periodically the supervisor and employee should conduct a
formal appraisal interview to review the employee’s actual performance
against objectives Taking corrective action whenever necessary
Personal development plan (PDP). It is prepared jointly by an employee
and supervisor for the purpose of improving proficiency and preparing for
additional responsibility. Personal development plans include methods of
overcoming deficiencies and building on strengths through specific
training measures during a particular time period. Establishing objectives for the future
MBO is both advantageous and disadvantageous. For instance while it focuses on
performance results rather than personal characteristics, the time and effort
required implementing it is extensive. High standards set may be difficult and
unrealistic to achieve. Objectives for new jobs are difficult to set.
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7. Work-standards approach
The work-standards approach is set by the managers. This is used mostly for
production workers and is a form of goal setting for the employees. It involves
setting a standard or expected level of output and then comparing each
employee’s performance to the standards. The work standards should reflect
average output of a typical employee.
Standards technique establishes work and staffing targets aimed at improving
productivity. When realistically used, it can make possible an objective and
accurate appraisal of the work of employees and supervisors.
To be effective, the standards must be visible and fair. Hence a good deal of time
is spent observing employees on the job, simplifying and improving the job
where possible, and attempting to arrive at realistic output standards.
Methods used to set standards include:
Average production of work groups
Performance of specially selected employees
Time study
Work sampling
Expert opinion
The advantage of this method is that the review is based on timely objective
factors.
The most serious drawback appears to be the problem of comparability. If
people are evaluated on different standards, how can the ratings be brought
together for comparison purposes when decisions have to be made on
promotions or on salary increases? For these purposes some form of ranking is
necessary.
8. 360 degree appraisals.
360 degree appraisals involve the appraisee receiving feedback from people
(named or anonymous) whose views are considered helpful and relevant. The
feedback is typically provided on a form showing job
skills/abilities/attitudinal/behavioural criteria and some sort of scoring or value
judgement system. The appraisee should also assess themselves using the same
feedback instrument or form.
360 degree respondents can be the appraisee's peers, up-line managers/execs,
subordinate staff, team members, other staff, customers, suppliers - anyone who
comes into contact with the appraisee and has opinions/views/reactions of and to
the appraisee.
11. The checklist Method
A checklist for completion by job holders is similar to a questionnaire but
response requires fewer subjective judgements and tends to be the YES and NO
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variety. Checklists cover as many as 100 activities; job holders tick those tasks
that are included in their jobs.
The advantages of this method are that it is flexible, can provide in-depth
information and is easy to organize and prepare.
The disadvantage is that it can be time consuming and the results are not easy to
analyze.
CHALLENGES OF PERFORMANCE APPRAISAL
Important challenges include legal constraints, rater biases, and appraisal
acceptance.
1. LEGAL CONSTRAINTS:
Performance Appraisals must be free from discrimination and should not violate
laws such as the Equal Employment Opportunity or any laws such as wrongful
dismissal (discharge), lay offs, demotions or failure to promote. An appraisal
system should be fair to all irrespective of race, sex, national origin, disability,
minorities, age, etc.
2. RATER BIASES:
a. The Halo Error – this takes place when the rater allows one aspect of a
person’s character or performance to influence the entire evaluation. It is
expected that one cannot be very good or very poor in all aspects. This error
can be minimized by educating the raters to make them aware of the problem.
The supervisors can also be asked to judge all the subordinates on a single
factor or trait before going on to the next factor.
b. The Error of Central Tendency – this refers to the reluctance to give
extreme ratings (either very poor or excellent). Instead the rater marks each
employee near the centre of the rating sheet, showing an inability to
distinguish between or among them (a form of range restriction). For instance,
on a rating scale of 1-5, a rater may rate all employees as 3 – distorting the
score to make each employee appear average.
c. The Leniency and Strictness Bias:
i. The Leniency Bias results when evaluators tend to be positively lenient
in their appraisal of an individual, causing the performance of
employees to be overstated and rated higher than they should be.
ii. Similarly, the Strictness Bias is just the opposite – it results from raters
being too harsh in their evaluations, sometimes to be seen as tough
judges. This tendency underrates performance, giving the individual a
lower appraisal standard than they deserve.
If all individuals in an organisation were appraisal by the same person, there
would be no problem. Difficulty arises when we have different evaluators,
some lenient and others strict, making judgements on the same set of
employees.
d. Cross-cultural Biases:
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When people are expected to evaluate others from different cultures, they
may apply their cultural expectations to someone who has a different set of
beliefs e.g. Arabic culture expects women to play a very subservient role
especially in public. Similarly, Eastern cultures award more respect and
esteem to the elderly compared to western cultures.
e. Personal Prejudice:
A rater's dislike for a group or class of people may distort the ratings those
people receive e.g. male supervisors often give undeservedly low ratings to
women who hold traditionally male jobs. Such prejudice prevents effective
evaluations and may even violate anti-discrimination laws.
f. Similarity Error (“similar-to-me” mistake).
Occurs when evaluators rate other people in the same way that the evaluators
perceive themselves, e.g. the evaluator who perceives himself as aggressive
may evaluate others looking for aggressiveness. Those who demonstrate this
characteristic tend to benefit, while others who may lack it may be penalised.
g. The Recency Effect
Subjective performance ratings are affected strongly by the employee’s most
recent actions - either good or bad - as they are more likely to be
remembered by the evaluator.
Where subjective performance measures must be used, biases can be
reduced through training, feedback, and the proper selection of PA
techniques.
3. LOW APPRAISER MOTIVATION:
If an evaluator knows that a poor appraisal could significantly hurt the employees
future (e.g. opportunities for promotion, salary increases, etc) the evaluator may
be reluctant to give a realistic appraisal.
4. APPRAISAL ACCEPTANCE:
The employees may not accept the appraisal result and evaluators may have
difficulties “selling” the results to the ratees.
5. LACK OF ORGANISATIONAL SUPPORT
This happens when the organisation does not act on feedback received from the
evaluation.
CONCLUSION
None of these methods is mutually exclusive. All of these performance
assessment methods can be used in conjunction with others in the list, depending
on situation and organizational policy. Where any of these processes is used, the
manager must keep a written record, and must ensure agreed actions are
followed up. To achieve the best results, employees will be motivated by
providing feedback on how they are doing.
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CH. 19: DESPATCH OR SEPERATION OF
EMPLOYEES
Chapter objectives.
Following the completion of this chapter, the reader will be able to:
Explain the importance of proper separation procedures
Understand the different approaches of separating workers from the firm
Appreciate the need for planning the separation of workers.
Introduction Despite all efforts to maintain employees in an organisation, the employment
relationship between individuals and the employing organisation will inevitably
break down from time to time. In some cases, the employees terminate the
relationship by resigning in order to take up positions elsewhere. The
management of an organisation may also terminate the contract.
Employee separation occurs when an employee ceases to be a member of an
organization. Managers must develop skills for helping employees who leave the
organization either voluntarily or involuntarily. A poor separation can damage a
firm’s reputation in its industry or community and limit its ability to attract the
scarce, talented employees that it may need in the future. In some cases, the
retention of employees may be directly related to the retention of major
customers and investors. This occurs where the employees have contacts with the
customers or where the investors have confidence in the particular employees.
Service industries may be more affected because in such industries it is the
employees who provide the services. The customers may have learned to trust
certain employees.
The reasons that make employees to separate from organisations range from
retirement to layoffs, downsizing, retrenchment, resignations, discharge,
dismissal and death. Employees who enter an organisation will at one time leave
that organisation hence there is always a movement of employees into and out of
every organisation. This movement is referred to as labour turnover. Managers
need to recognise that a high turnover can be a very costly experience to an
organisation. Turnover costs include recruitment costs, selection costs, training
costs, accident costs, loss of production costs, overtime costs and replacement
costs. Consider the case for replacement of pilots or information technology
specialists especially when they are in short supply.
While separation has many costs, it also has many benefits. Some of the benefits
include the following:
When turnover rates are too low, few employees will be hired and
opportunities for promotion are reduced.
Low turnover may affect productivity negatively especially where the
workforce is complacent and does not generate innovative ideas. Thus
separation enables poor performers to be replaced, innovation is
increased, and opportunities for greater diversity are enhanced.
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Separations enable an organization to reduce its labour costs. The firm may
be incurring unnecessary expenses on marginal performers.
TYPES OF EMPLOYEE SEPERATION Separations can be either voluntary or involuntary. Involuntary separation occurs
when the turnover is initiated by the organization especially among employees
who would prefer to stay while voluntary separation is initiated by the employees
whom the organization would prefer to keep.
The main types of voluntarily separation are quits and early retirement.
1. QUITS (JOB WITHDRAWALS)
An employee may withdraw from a job because they are dissatisfied with the job
or the job environment. Some of the issues which lead to dissatisfactions include
perceived or real poor pay and benefits, difficulties with supervisors and co-
workers, inability to reconcile with the tasks and roles and other personal
predisposition issues such as joining a spouse who is elsewhere or the desire to
perform other family obligations. Other reasons include poor health, poor
working conditions and poor management.
Employees who are dissatisfied may seek to change the undesired behaviour but
where they cannot do so, they may opt to quit the job. In situations where the
employees cannot change their situation or remove themselves from their jobs,
they may psychologically disengage themselves from the jobs. This can be done
by showing less commitment to the job or to the organization and identifying less
with both items.
Sometimes, employers encourage employees to quit by using pay incentives
such as severance pay or buyouts. An example is the use of “golden handshakes”.
This method of separation should be avoided at all cost since they not only place
a heavy financial burden on an organization but they may be a manifestation of
poor worker management
2. VOLUNTARY RETIREMENTS (EARLY RETIREMENT)
Early retirement is initiated by the employee. It occurs at the end of a certain
period and results in the employee getting certain benefits. The organization
must plan for the early retirement of employees.
In all organisations there must be stipulated retirement regulations, including
mandatory and voluntary retirement schedules. Since retirement is a major stage
in one’s life progression, an organisation has an important role to play in the
facilitation of this transition.
In determining retirement regulations, it is important for managers to consider
the pros and cons of both mandatory and voluntary retirement.
Mandatory retirement may be advantageous because it is simple to administer;
it creates opportunities for younger employees to exploit their potential; it aids
human resource forecasts and plans; it enables employee to plan for their exit in
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advance and that it reduces inequities in decision making in regard to separation.
However, mandatory retirement does not recognize the fact that employees
depreciate at different rates and that crucial talent may be lost due to a rigid
regulation. It is also likely that a mandatory retirement age may be lost due to a
rigid regulation. It is also likely that a mandatory retirement age may induce
some workers to “retire” while they still holding on to the jobs during their
twilight years!
Some sociologists have come up with several phases through which employees
may experience the retirement process. These phases are:
Remote phase. This begins many years before the actual retirement date.
Awareness of an impending retirement is important so that provision can be
made for financial and social security;
Near phase. Provides the reality of an imminent retirement. An employee
begins to see and be seen in short term. The engagement of employees in
major organizational activities begins to wane. Retirement ceremonies and
long service awards are held at this stage.
Honeymoon phase. This is the stage where retirees experience unlimited
freedom away from employment. The retirees engage themselves in a
number of social activities such as visit, travel, games and picnics. It is a
spending spree;
Disenchantment phase. This is the stage when the honeymoon is over. Those
retirees who did not plan for retirement will find it difficult fitting into new
communities and changed roles in the society. They, therefore, feel bored
and disenchanted after the honeymoon;
Reorientation phase. At this stage the retirees reorient themselves into new
lifestyles. Counselling programmes are useful here in providing the retirees
with the much-needed assistance programmes. This is the time to face
realities and develop appropriate interests and capabilities necessary for
survival;
Stability phase. This is the stage when the retirement programmes and
lifestyles have been fully developed. A retiree can lead a predictable and
satisfying lifestyle because he or she has now acquired a gainful position in
society;
Termination phase. This is when the retiree is no longer self-sufficient because
he or she has exhausted both the financial and physical resources. This is the
stage when the retiree ceases to be retired and becomes dependent upon
family, relatives, friends or home for the aged. It marks the end of retirement.
INVOLUNTARY SEPERATIONS These are initiated by the employer on those employees that are considered
undesirable either due to failing to meet performance expectations are the
inability to comply to the employer’s policies.
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The main types of involuntary separations are discharges and lay offs.
1. DISCHARGES Discharges are instituted on those employees that are unable to meet
performance requirements or those who violate company policies on the job.
Failure to change some unacceptable behaviour is a very good ground for
dismissal. Employees who engage in serious misconduct, such as theft or
dishonesty, may also be discharged. Other reasons for summary dismissal
include absenting oneself from the place of work without a just cause, inability to
perform jobs because of drunkenness, use of abusive language, being arrested
for an offence that can lead to imprisonment, and committing an offence to the
detriment of the employer.
Discharges, also known as dismissals, can be defined as any one of the following:
An employer has terminated a contract of employment with or without notice;
An employee reasonably expected an employer to renew a fixed term
contract of employment on the same or similar terms, but the employer
offered to renew it on less favourable terms, or did not renew it;
An employer refused to allow an employee to assume work after she took
maternity leave in terms of any law, collective agreement or her contract of
employment;
An employer who dismissed a number of employees for the same or similar
reasons has offered to re-employ one or more, but has refused to re-employ
another;
An employee terminated a contract of employment with or without notice
because the employer made continued employment intolerable for the
employee.
Discharging employees can be a very difficult task that needs to be handled with
a lot of care and attention to the affected employees. Where the exercise is poorly
conducted, it can lead to long court battles in which employers can be fined huge
sums of money. In situations where the discharged employee wins the court case
and the employer is forced to accept the person back, uncomfortable relations
can arise with some employees being violent to the employer. Thus an
organization should have a standardized systematic approach to discipline and
discharge.
Dismissal can have serious impacts on the affected persons. They can experience
trauma arising from shattered egos. Moreover, discharges can bring financial,
social and family problems. And those who “survive” in the organization may also
experience the trauma and reduced motivation as a result of losing a colleague or
a dear friend. Some organizations rank their employees from the best to the worst
in terms of a performance variable such as the amount of sales made.
Consequently, some of the employees at the bottom are then discharged. Those
who remain know that the next performance appraisal exercise may affect them
negatively.
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Employers should be entitled to and given the opportunity to make the
appropriate justification for terminations and, having followed fair procedure, to
dismiss employees. However, all dismissals should be done fairly.
Established disciplinary procedures must be exhausted before an employee is
discharged. In the first instance the employee should be given an unofficial
verbal warning with a witness present. The second offence warrants an official
written warning. The third offence is responded to with a second official warning
with a threat of temporary suspension. Where the employee repeats the offence a
fourth time, s/he is temporarily suspended and given a last chance notification. It
is only when the employee repeats the offence that s/he is terminated but with a
right to seek arbitration.
Employees should be given the opportunity to change those behaviours that are
deemed to be undesirable. After all, who knows, they could change and become
good performers.
2. REDUNDANCY
Redundancy has been variously referred to as layoffs, downsizing, rightsizing,
reduction-in-force, or retrenchment. It occurs where some change forces the firm
to reduce its workforce. The changes include increased global competition,
reductions in product demand, changing technologies that reduce the need for
workers, and mergers and acquisitions. Dealing with redundancy is a painful
exercise for human resources managers. This is because it involves an abrupt
loss of earning, separation from colleagues, loss of personality and many
uncertainties ( Okumbe, 2001).
Due to the many negative effects of redundancies, it should be done
systematically. The following steps provide a good guidance on the process.
The organization must engage in proper human resource planning to avoid
ending up in a situation where some employees are declared redundant.
Employees who are likely to be declared redundant should be warned in
advance and encouraged to resign voluntarily through the use of monetary
incentives. The organization should use contingency measures such as
terminating part-time services, eliminating over-time, removing out-sourced
contracts, job sharing, and applying temporary layoffs.
Affected employees should be assisted to get jobs elsewhere as soon as possible.
In situations where the redundancy exercise must be carried out, then it should
be done as fairly as possible.
Death ( natural attrition).
Sometimes employees die while they are still in active employment organizations
should put mechanisms in place that ensure that employees don’t die from work
related injuries while they are still in active employment. The death of an
employee needs to be handled with care and concern so that those who remain
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perceive the organization even better and continue to maintain their commitment
to it.
Outplacement counselling Some organizations provide outplacement counselling to help employees make
the transition from one job to another. This occurs mainly where the employee
lost the job involuntarily and needs to get another job as soon as possible. The
counselling seeks to help the former employees deal with the psychological
issues of associated with losing one’s job (grief, depression, fear). It also seeks to
convince them that losing one job is not the end of the world; in fact it may be the
beginning of a better engagement in life.
Ch. 20: EMPLOYEE COUNSELLING
Learning objectives After reading this chapter, you should be able to:
Explain the need for employee counselling.
Discuss the characteristics of a successful counselling program
Characteristics of a good counsellor.
Examine and understand the counselling process.
Introduction. Human beings have many problems. The problems could be personal or work
related. Stress, alcohol, drug abuse, cardiovascular disease, HIV/AIDS, obesity,
mental illness, and emotional problems are common occurrences in our society.
These problems may contribute to accidents, absenteeism and turnover, poor
decisions, decreases in productivity, and increased costs. Managers often try to
reduce the impact of such problems through the concepts of employee
counselling, training and development, as well as motivational programs.
Counselling is a part of the broader concept of employee assistance programs
(EAPs). These are job based programs operating within a work organization for
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the purposes of identifying troubled employees, motivating them to resolve their
troubles, and providing access to counselling or treatment for such employees.
EAPs attempt to ameliorate problems encountered by workers who are drug
pendent, alcoholic, or psychologically (mentally) troubled.
Definitions of counselling
The term counselling refers to a variety of activities ranging from informal
discussions with a supervisor to intensive one-on-one discussions with a trained
professional.
It is also defined as a discussion of a problem that usually has emotional content
with an employee in order to help the employee to cope with it better.
Dale Masi (1984) defines counselling as consisting of four activities namely:
Establishing a relationship between a trained counsellor and an employee;
Careful discussion of personal problems experienced by the employee;
Having an appropriate referral that secures the necessary assistance;
The provision of short-term counselling when a referral is not necessary.
Employee counselling existed since time immemorial but proper employee
counselling programmes are said to have began at the Western Electric
Company in Chicago in 1936.
Characteristics of an effective counselling program.
A successful counselling program should have the support and commitment of
the top management. Such support will ensure that the top management
formulates policies and procedures to govern the process. Specifically the policy
on confidentiality should be emphasized. The local union representatives should
also be involved. A wide range of services should be included in the program.
Proper records should be kept so that the program can be evaluated afterwards.
Functions of counselling
Counselling serves the following functions to employees( Davis & Newstrom,
1986).
Advice. Through counselling, the counsellor will be able to provide advice the
counsellee on how to come out of the present problems.
Reassurance. Counsellors seek to reassure the employees that all is not lost and
that there is abetter future.
Communication. Counselling sessions provide excellent opportunities to
communicate upwards, downwards, or even horizontally.
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Release of emotional tension. The employee may have in-built emotional tension
that has piled up over some time period. Through counselling, emotional tension
is released.
Clarified thinking. It is through counselling and open communication that
counselee may understand a problem from different perspectives. Perhaps, some
of the perspectives are positive yet they had been ignored.
Reorientation. Counselling helps employees to change their attitudes and
perspectives.
Counselling needs
Counselling is provided because of the following problems that may be
experienced by employees.
Substance abuse-common drugs abused by employees include marijuana and
cocaine. Users of such substances are at greater risks for accidents, injuries,
disciplinary problems, and involuntary turnover. Counselling is supposed to
assist such people to change their behaviour for the better.
Mental health- poor mental health can interfere with life’s major activities such as
eating, managing money, and functioning in social, family, work and educational
settings. Poor emotional and mental health can manifest itself in the form of
inability to adjust to problems; battering, incest, rape, or crime; sexual problems
such as impotence; divorce and marital problems; depression and suicide
attempts; difficulties with family or children; sexual harassment in the workplace;
pathological gambling; and legal and financial difficulties.
Retirement-. For many employees retirement presents serious challenges which
may require the employee to be counselled
Redundancies. There are numerous difficulties that may result from
redundancies. These include loss of earning opportunities and reduced self
esteem. Counselling can be very beneficial in such cases.
Other reasons for counselling include poor performance; discrimination in the
workplace; alcoholism, stress and burnout; bereavement; marital problems and
other social problems (poverty, female genital mutilation, low levels of education
etc).
The counselling process Trained counsellors are better than supervisors in providing counselling.
The counselling process can be divided into six distinct steps, namely, problem
identification, education, counselling, referral, treatment, and follow up.
1. Problem identification.
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At this stage the problem that warrants counselling is identified. The problem
could be medical or even emotional. The employee may volunteer to undertake
the medical tests or the supervisor may use a questionnaire to identify those
behaviours that indicate the need for counselling.
2. Education
This is the stage where the counsellor provides information about the nature,
prevalence, likely causes and consequences of the problem, and ways in which
the problem can be prevented. Consider the case of obesity.
3. Counselling
The employee and the counsellor discuss the problems and work out an action
plan. Ideally there are three types of counselling namely directive, non-directive,
and participative/cooperative counselling.
Directive counselling- this type of counselling assumes that the counsellor has
the solution to the problem facing the employee. The counsellor seeks to
motivate the employee to implement the solution. The two parties discuss the
problem in details but the assumption of a superior-inferior relationship is a
major weakness of this approach.
Non-directive counselling. Here, the employee is assumed to be the best source
of solutions to the problems he/she is encountering. The work of the counsellor is
to encourage the employee, through skilful listening, to explain the conflict and
issues surrounding it. The counsellor would then help the employee to develop
insights into the problem. It provides a coordinate relationship between the
counsellor and employee.
Participative and cooperative counselling. It integrates aspects of both the
directive and non directive counselling in that both the counsellor and the
employee assist each other in solving the problem. Thus there is a cooperative
exchange of ideas in order to find an amicable solution to the problem.
4. Referral
At this stage the employee may be referred to an appropriate source of
assistance. Examples are medical practitioners and specialized counselling units.
6. Treatment/ Intervention
The employee would then receive the necessary treatment. Cases of mental
illnesses can be treated in a mental health hospital.
7. Follow up
Some form of monitoring is needed to ensure that the employee is carrying out
the treatment and obtain information on the employee progress. It is also
necessary to evaluate the effectiveness or the efficacy of the counselling
programme implemented and to make adjustments where necessary.
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CH. 21
New Trends in
Human Resource Management
Chapter objectives The learning objectives for this chapter are to:
Explain new trends in the business and the effects of these trends on
human resource management.
Understand how managers respond to these changes.
1. Introduction The modern business world is experiencing various trends which are affecting
how employees are expected to perform their duties. A trend is a general move
in a particular direction. In the past, trading patterns and markets were stable,
technology was static, customers were passive, speed in getting to the market
was secondary, competition was limited to sectors and regions, and hierarchies
were generally accepted. Since the 1960s, however, much of the world has been
almost continually changing. Customers demand businesses that are better,
faster, and cheaper; employees want more pay; globalisation has opened up new
economic opportunities and knowledge workers have created a new digital
economy.
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Recruiting, managing, maintaining, and retaining workers in the new business
environment has become more challenging. The emerging trends have led to the
need to re-envision and clarify the human resource role and to articulate its
expectations to the individuals serving in this role. Employers must be keen to
identify these trends and to ensure that the employees are well taken care of in
line with the trends. Workers, commonly referred to as human capital, are assets
to an organisation, since they contribute to the organisation’s objectives. An
organisation must, therefore, invest in its people, so that they can generate
worthwhile returns.
2. The changing role of human resource management: A
historical perspective The field of human resource management has undergone tremendous changes
since the 1930s. In those earlier days, human resource departments were called
“health and happiness” departments and the people assigned to deal with
personnel issues were often those who were past their prime. The human
resource department was seen as a place where less-productive employees
could be placed with minimal damage to the organisation’s ongoing operations.
Individuals in the HR department were perceived as those responsible for
planning company picnics, vacation schedules, and retirement parties. Human
resource management, as an activity, was seen as a necessary, but unimportant
part of the organisation.
The role changed in the 1950s, when the human resource manager was viewed
as the recruitment specialist. The 1950’s and 1960’s were years of expanding
economic activity hence the focus changed from welfare to recruitment and
human resource planning since all organisations faced intense competition for
labour.
Trade unions, backed by a flood of labour legislation, came in handy in the
1960’s and 1970’s, bringing up the need for human resource officers to become
industrial relations negotiators. The human resource manager manager,
therefore, needed to possess industrial relations and negotiation skills, as well as
legal knowledge, in order to survive in those murky waters.
A weakening of general economic conditions and unemployment in labour
markets all over the world marked the 1980’s and 1990’s. This forced businesses
to carry out extensive cost-cutting measures, especially in the areas of labour.
Many governments all over the world, including the government in Kenya,
adjusted their legal frameworks to reflect the new economic realities and allowed
businesses to make substantial changes in their labour in the light of the new
business priorities.
The human resource manager had to evolve to become a visionary and
corporate philosopher in the late 1990s, as the business environment became
more challenging. The role of the contemporary human resource manager has
become more important in the face of business competition. The manager needs
to have a vision for the company, which vision should be in line with the
organisation’s vision and mission statement. The manager also needs to know the
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changing environmental conditions that occur in the marketplace.
3. Emerging Trends in Human Resource Management Emerging trends in the management of human resources can be analysed by
looking at the following aspects.
3.1 Employee Health and Safety
With the rising cost of healthcare, employees are choosing not to be insured and
treated, and are also bringing their physical and mental illnesses and injuries to
the workplace. Work intensification is also leading to stress and stress- related
illnesses. Although this problem can be addressed through adding more workers
and automation, it can easily lead to more people suffering from mental health
conditions or using medication. Further it can lead to increased workplace
violence and absenteeism or a growing number of errors causing accidents with
the resulting business costs. Therefore, the human resource manager has to be
knowledgeable in stress management. The human resource manager will need to
look into the issue of employee health to ensure that it is covered, so that the
employees do not continually bring their illnesses to the workplace.
The rising cases of terrorism in the world have also affected the mobility of
labour across the world. Human resource managers have to look into the issue of
security to ensure that expatriates are safe wherever they are posted for work;
otherwise the foreign branches may lack qualified staff. Examples of cases of
terrorism are the 1998 bombing of the USA embassy in Nairobi, followed by the
bombing of the Paradise Hotel in Kikambala, Mombasa in the same year.
Epidemics, such as HIV/AIDS, Ebola, Tsars, Asian Bird Flu and malaria, have
brought in a new challenge to human resource management. The challenge goes
all the way to the functions performed by the human resource manager, right
from planning, recruitment, employment, maintenance, compensation,
integration and separation. Discrimination due to sicknesses such as HIV/AIDS
has led to businesses being sued by aggrieved employees. These epidemics
have also affected employee output and, therefore, business performance. The
cost of medical cover for such employees has also risen tremendously, therefore,
affecting the company’s profitability. These epidemics have also affected the
recruitment and maintenance of employees, with an increase of death rates of
employees at their prime, thus making the costs of training and retention high.
The human resource manager will need to look into the issue of recruitment,
retention, development, and other areas of management in view of the changing
scenario. He/she will need to know the company’s legal position in relation to
such epidemics.
Many organisations are also striving to enhance the quality of work life and
personal lives of their employees and of the employees’ families. In-house health
clubs, yoga, and meditation centres to relief stress, sports and cultural activities,
employee get-togethers with invitations for the whole family, and day care
centres are being provided by organisations.
3.2 Employee Relations
The relationship between the employee and the employer has been changing,
with the employee becoming a partner in the business through measures such as
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employee stock ownership schemes. The implication is that the master-slave
relationship is doomed to die a natural death. The human resource manager will,
therefore, need to master ways of dealing with the employee cum employer in
the workplace. These relationships also being encouraged by the quotation of
companies in the stock exchange markets.
As the employee-employer relationship evolves, employees are demanding
more information concerning their contribution to the firm’s financial
performance. Many firms are also faced with the challenge of retaining
competent workers in the face of increased competition for top performers.
Developed countries such as the United States of America will need to cope up
with increased numbers of older workers, minorities and immigrants into their
labour force. This may not be the case in developing countries such as Kenya
where majority of the workers are relatively younger.
Corporate governance is now a common issue of concern for human resource
managers. The recruitment, selection and role played by a firm’s board of
directors and senior leadership are being continuously reviewed to ensure that
all organs of an organisation are working towards the common good for all
stakeholders.
Human resource managers are also concerned with ethical issues. The news
media has been quick to report unethical business practices towards customers,
employees, and any other stakeholders. More expectation is placed on managers
concerning the activities of businesses. The aim is to ensure that business firms
demonstrate good corporate social responsibility practices.
3.3 Globalisation
Globalisation of trade and economy are taking deep roots in all countries. This
refers to the tendency of firms to expand their sales, ownership and/or
manufacturing to new markets abroad. For example, Toyota produces the Toyota
Camry in Kentucky, while Dell produces and sells its personal computers in
China. According to the World Bank, by 2025 India and China will provide 27% of
the world’s GNP. All types of firms, whether small, medium or large sized in many
parts of the world are trying to expand their investments into China and India so
as to benefit form their large populations and resources. The world has thus
become a global village. Free trade area agreements that reduce tariffs and
barriers among trading partners (such as North America Free Trade Area,
Common Market for East and Southern Africa, and European Union) further
encourage this trend. More globalisation means more competition and more
competition means more pressure to be “world class”, to lower costs, to make
employees more productive and to do things better and less expensively. Quality
human resources have, therefore, become an important base with which to
respond to the emerging environment.
Due to globalisation, human resource management processes have had to
change. Employees have to be trained on how to sell or buy products and
services from different parts of the world. They have to learn about international
trade, since they can be sent to work in different parts of the world.
Globalisation has made it easy for businesses to trade with one another without
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much physical movement of staff. This means that employees can work in the
locality of their companies, without having to move and be far away from the
place of work and their families. The family and social life of employees is not
interrupted very much. Some companies even sponsor their senior staff to go on
holidays in foreign lands. This enhances motivation and productivity in the
organisation. Globalisation has had major implications for human resource
management.
The continued expansion of businesses and the increased interdependence of
countries have brought issues of outsourcing and off-shoring of resources,
especially labour-related resources. This may take the form of outsourcing to new
supplies or changing employment contracts to hire individuals as consultants
rather than as employees, or to hire only highly skilled professionals.
Outsourcing creates savings in investments, training, time, and other resources. It
also creates a shift toward greater intimacy with contractors, the sharing of plans
and capabilities, agreement on the level of quality in components and questions
about how to deal with points of conflicts. This leaves the core employees to
concentrate on the core activities of the organisation. The result is a change in the
corporate culture, which also affects the output of businesses.
As people intermingle with each other from different countries, they encounter
different languages, laws, skills, and culture, among other things. The challenge
here is to train people to know international laws, to have sensitivity skills, to
learn foreign languages, and also to expand their level of understanding through
education. Human resource managers will themselves need to be conversant with
international labour laws and cultures. They may also need special skills to
handle these changes.
With continued globalisation, ethical and corporate social responsibility issues
are arising in order to maintain the high visibility of the business in the eyes of
the public. The pure profit motive no longer stands alone as the unitary focus of
business. Issues such as consumer satisfaction, pollution caused by firms and
exploitation of employees and of customers are gaining prominence. Employers
must ensure that their work policies protect the environment and that employees
combine business with ecology. Businesses may also be required to provide
social amenities such as schools, hospitals, and infrastructures to the communities
in which their businesses are based.
Indeed, some organisations are often involved in unethical practices such as
price gouging, falsifying data, and misleading adverts, among many others.
Employees often require ethical treatment, especially in the areas of
confidentiality of information, the rights to privacy, sexual orientation and
harassment, exposure to safety and health hazards, equal employment
opportunities, and employee honesty. Addressing these issues is necessary in
order to create a conducive work environment in which employees are satisfied
and retained.
In the twenty first century, there is an increase in the concern for the natural
environment due to the fast depletion of the ozone layer and global warming.
Governments have enforced strict laws and regulations, in order to control the
activities of their citizens and industries against pollution of the environment.
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Firms have undertaken pollution control activities such as proper drainage of
wastewater and avoiding burning of coal, which emits dioxide into the
atmosphere. There are also regulations regarding how employees should be
treated in the workplace and firms to provide safe work environments.
Human resource managers have the obligation to ensure organisational
compliance with these laws and governmental rules concerning the hiring,
training and compensation of employees. In addition, the human resource
manager has a significant role to play in the design and execution of a social
audit, providing internal information to management and the external public on
how the firm is socially responsible. Human resource managers should also
educate the employees on environmental issues and activities that affect the
environment.
The human resource manager, therefore, together with the other managers,
may have the responsibility of fostering good corporate citizenship on the part of
the organisation. Companies will be called upon to provide more frequent
statements of social responsibility in their communications with employees and
other stakeholders, and the human resource department may have to play a very
significant role in this process.
3.4 Technology More and more businesses, large and small, are trying to incorporate the latest
technology into their operations. Indeed, many of the improvements that make
firms world class involve technology. Today, human resource professionals face
the challenge of quickly applying technology to the task of improving their
operations.
The introduction of tea-picking machines in the Kenyan tea industry, though
much resisted, has led to many employees being declared redundant. Other
technological developments, such as the use of robots in some organisations,
computerisation of operations (e.g. e-ticketing, e-banking, e-learning, etc.),
electronic communication systems (e.g. audio systems, chat systems,
teleconferencing, electronic mail systems, video conferencing), and information
technological advances (e.g. computing, electronics, biotechnology,
engineering, and transport) all have human resource implications. For example,
the use of telephone and video conferencing provides low-cost alternatives for
interviewing, by reducing the nagging costs of travel, accommodation, and
incidentals. Electronic communication ensures that more ideas are availed for
developing new products. Remote sites for video conferencing, computer
managed games and simulations, videotaped lectures and interactive video
training are relevant in providing “just in time training”. New softwares, such as
Computer Aided Design, have been developed to assist the design of new
products or modification of existing products.
It is, therefore, evident that the increase in technological advancement has
greatly affected the trend of human resource management. Technology has made
it such that employees can work from the comfort of their homes and deliver
results within deadlines. Telecommuting enables employees to balance their
work and home lives. Companies are also employing skilled workers from all
over the world. These global workers need not relocate, because they can work
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virtually through wireless technologies and videoconferences. The evolution of
the web-based employee means that human resource managers must learn to
work with the “away from office” employee; they must also initiate
telecommuting training. Managers need not meet face-to-face with the staff, as
they can hold conferences over the Internet via videophones. The human
resource manager must devise ways of managing communication changes.
Technology has also brought new methods of surveillance via the high-speed
Internet. The technology has become cheap and affordable, even to the smallest
companies. It is, therefore, easier and more effective to monitor employees’
activities, health and safety, as well as to prevent theft. Human resource
managers, therefore, need these technologies to assist in avoiding costly lawsuits
arising from criminal acts in the workplace and also to debunk false worker’s
compensation claims. Workers may also file lawsuits against employers, claiming
invasion of privacy; hence the need for legislation to limit intrusion of privacy.
The use of robots and machines has greatly reduced the role of human
resources in industries and firms. This has resulted in personnel layoffs,
redundancies and retrenchments. Human resource managers are, therefore,
required to prepare separation packages.
The composition of technical or professional employees in organisations is
increasing as work becomes more technical. Workers in non-technical areas are
being downsized, because machines are taking over most of the work. Examples
are found in banks where Automatic Teller Machines (ATMs) have taken over
most of the tellers’ work, and industries where most of the assembly lines are
automated and robots are used to do most of the manual work, especially in
developed countries. Due to this business trend, workers are forced to learn new
skills, especially in technical areas, and to look for employment in the relevant
areas. In labour-intensive countries, mostly in the Third World, there has been
resistance to introducing technology, for fear of people losing their jobs.
Although technological advancement may result in job redundancies, it cannot be
resisted and human resource managers must prepare programmes to cope with
the new developments.
3.5 Changing Values and Expectations of Employees Employees are not content with merely earning a good salary, but are also
looking for personal satisfaction and meaning in their work. Employees expect to
be recognised for the contributions they make on the job. They expect to receive
opportunities for lifelong learning that is beneficial for any career changes. Some
employees have young children or aged parents to care for; hence they juggle
work and family obligations. Consequently, there is a need to balance the
demands of their work and non-work lives.
Moreover, there is a tendency for employees to value leisure, family activities,
and avocation assignments more than work. This means, therefore, that the
human resource manager must find ways of motivating employees to work.
Employees are looking for employers who offer flexible and family-friendly
workplaces. Virtual offices, flexitime, family leave, telecommuting and other
innovative work arrangements are steps that employers can take to create this
necessary balance. Companies like Unilever, Kenya Breweries, and Kenyatta
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National Hospital have cafeteria systems to cater for the workers.
To meet these changing values and expectations and to become employers of
choice, organisations must have the flexibility to implement new compensation
and benefits concepts tailored to their business environments and strategic
workforce requirements. They should offer a broad range of benefits and quality
of work flexibilities that are tailored to the unique and changing needs of
employees. They should strengthen the leadership competencies of their
managers, in order to motivate and inspire employees and attract new diverse
workers.
3.6 Politics The department of human resource management has to contend with politics
ranging from parliamentary legislation, trade union politics, societal politics,
interested parties and lobby groups such as animal rights groups and
environmental concerns, among others.
Employment legislation will continue to be of great concern to human resource
managers, especially in the national and international arena. Trade union politics
is also another area that affects the trend of human resource management. The
changing mode of trade unions and activism needs a new outlook towards the
operation of human resource departments.
A flexible workforce is needed, if an organisation is able to respond to
economic and political changes effectively. This may call for redeployment of
workers, and special retirement incentive programs.
3.7 Non-Compete Contracts Organisations have come up with non-compete contracts, in which they bind the
employees not to do certain things, such as seeking for employment with client or
competitor companies for a certain period of time. These contracts may also
require the employees not to start similar businesses within given areas for
certain periods of time after leaving the employment. The human resource
manager will need to develop ways of protecting the company, using methods
such as non-compete contracts.
3.8 Demographics Demographic trends of concern to the human resource manager include an aging
workforce in some developed countries and the growing diversity of the coming
generations. This will bring about issues such as the outsourcing of labour,
immigration, succession planning, emphasis on language and cultural diversities.
This will affect the output at work, employee replacement, and recruitment. The
human resource manager will, therefore, need to come up with measures to
counter this.
There has also been an increase in the recruitment of minorities and women in
the workplace arising from legislation and affirmative action in the society.
Managers must grapple with this new trend in business.
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3.9 Productivity Productivity refers to the output of goods/services produced per unit of output.
Labour productivity specifically refers to the output per hour. Ceteris paribus,
organisations with high productivity are more responsive.
Many firms, local and foreign, have experienced productivity crisis. The
extreme effects of this have been layoffs, plant closings, mergers and
divestitures. Business firms are faced with the challenge of increasing
productivity growth rates in general, including labour productivity. Strategies
used to achieve this include gain-sharing programmes, in which employees
receive monetary bonuses for productivity increases.
Nowadays, firms are competing not only on the price dimension, but also on
product quality. The automobile industry is a classic example, where Japanese
automakers (such as Toyota, Nissan, Honda, and Mazda) are offering cars that are
more affordable and superior relative to US automakers (such as General
Motors). Human resource managers must make changes, such as employee
quality circles, increased employee participation in decision-making and self-
managing work teams. New compensation programs such as profit sharing are
also being implemented.
There has also been a trend of many organisations moving into service
businesses, such as banking, financial planning, healthcare, retailing, day care,
and mail delivery. Jobs may, therefore, need to be restructured and performance
appraisal systems must gauge how well employees are providing services and
satisfaction to the customer.
Controlling labour costs has become a key strategy in the private sector for
improving the organisation’s competitive posture and in the public sector for
maintaining taxes at levels acceptable to the public. To implement this, numerous
human resource initiatives and activities have been put in place. These include
institutionalising pay freeze or reduction programmes, tying pay more closely to
organisation success through profit-sharing schemes, and requiring employees
to pay a greater percentage of their benefit costs, especially for health insurance
premiums and pensions.
3.10 Increased Competition There is a critical shortage of skilled workers in some occupations and
geographic areas. Recruiting for highly technical occupations is becoming
difficult. Employees with high demand skills often choose from multiple
employment offers and take advantage of their marketability to negotiate for
flexibility and desirable benefits.
To curb the increased competition for skilled workers, organisations must
continue to rely on workforce planning and forecasting to ensure they have the
right people with the right skills in the right jobs. Human resource managers must
use innovative recruitment and hiring strategies to identify and quickly select the
high-quality, diverse workforce they need for the present and future purposes.
They will also concentrate on succession planning and leadership development
programmes, so as to pool highly-qualified replacements when experienced
leaders leave. There is also a need to create and sustain knowledge management
systems to preserve expertise within the organisation. Organisations should also
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be agile in the delivery of “just-in-time” training to meet rapidly changing
responsibilities and/or assignments.
3.11 A Shift in Roles Human resource management is becoming a strategic function, where line
managers are increasingly held accountable for directly delivering some human
resource management services. As line managers assume more hands-on
responsibility for managing all aspects of the workforce, human capital
practitioners will also shift to complex roles, such as business strategic
partnerships and acting as change agents.
This shift in roles requires line managers to be prepared to assume increasing
responsibility and accountability for human resource management. The human
resource manager must operate with fewer rules, expanded delegation of
authority, and line management accountability for results.
Human resource managers have to develop a new set of human resource
management competencies, while also maintaining a strong knowledge of
national human resources. This will enable them to apply human resource
management principles to solve organisational problems and support line
managers.
3.12 The Business Alliance As new relationships are set up with customers, suppliers, competitors and other
outsiders, the structure of business changes and innovation occurs in the
management and organisation of work. Therefore, these changes must be
reflected in shifting missions, roles and responsibilities for human resources.
New models for doing business have developed, which have implications for
human resources. These alliances involve two or more organisations coming
together in a joint, cooperative venture on either a long-term or a short-term
basis. The alliance is aimed to attain goals in a timely and effective way at low
risk. Each participant in the alliance enjoys the benefit of greater speed,
timeliness, complementary skills and reduced risks.
The alliance has overtaken the traditional top-down control model of business
(hierarchy) and is much more organic, intimate and cooperative. It involves
exchange of workers, sharing of plans, and joint work in business activity from
planning, manufacturing, and marketing to maintenance. The alliance calls for
management to change its attitude and facilitate and promote cooperation and
new training on how to embrace and deal with organisations within the alliance.
Organisations in the alliance may decide to continue their relationships or
terminate them once they have achieved their goals. Flexibility is one advantage
of the alliance.
For the benefit of the company, human resource managers must explore the
many forms of business alliances, staff requirements, joint activities, shared
resources such as space, training and preparation and new rules and guidelines
that have to be passed out to the company’s participants in order to make the
alliance work.
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3.13 Virtual Corporation The success of business alliances and other business-to-business relationships
has enhanced the emergence of the virtual business or virtual corporation. This is
common in the movie industry, where the long lists of credits at the end of most
films include writers, directors, producers, and actors, who come together to put
the financing and other capabilities together and, once the task is over, disperse
to new ventures.
Virtuality produces many human resource issues in terms of labour relations,
unions, worker expectations, time and performance, qualifications, location of
worksites, and the quality of the people engaged in various tasks. All these issues
have brought new challenges to the human resource work.
3.14 Performance Contracting Performance contracting is a new trend in the business world, where employment
is pegged to the performance of the worker. Traditionally, workers would be
employed on permanent and pensionable terms. In recent times, most businesses
and organisations are focusing on performance contracting, where employees
are paid according to their performance and attainment of set targets. Most
companies are employing workers on contracts of specified periods and their
performance is appraised regularly, to determine whether their contracts should
be renewed. Performance contracting is also being adopted by governments
such as Kenyan government, where civil servants are being placed on
performance contracts.
This new trend has led to job competition, with workers striving to improve
their performance and skills in order to retain their jobs. In Kenya, this new
development has resulted in more workers seeking additional knowledge and
skills by pursuing further studies in universities and colleges. More employees
are enrolling in evening classes and part-time learning. This has resulted in an
explosion of knowledge.
4. Conclusion New trends in business continue and human resource managers need to be on
the move in order to compete in the market effectively. Indeed, it is important to
realise that change is here to stay, and that all the practices that are working
today may not necessarily work tomorrow. The human asset will need to be
managed prudently, considering customer expectations, market changes, and
the strategic decisions of organisations.
Human resource managers must cope with the new models of business by
anticipating them, advocating systematic change, and recruiting, rewarding, and
retaining people who will be effective in the new business organisations and
relations.
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CH. 22
GLOBAL HUMAN RESOURCE
MANAGEMENT
Chapter objectives Following the completion of this chapter you should be able to:
Understand the motivations for global operations
Discuss significant global trends
Explain the different levels of global participation
Analyse how globalization affects the recruitment, selection, training and
development, compensation administration, maintenance, integration, and
separation of employees.
INTRODUCTION A business is an independent activity formed to produce goods and services to
be sold to people and other businesses at a profit. It can be performed at a
domestic, international or global level.
Domestic business means marketing goods and services within the home
country. This is how many businesses begin.
International business means crossing many nations and international marketing
therefore involves developing and performing marketing activities across
national boundaries. For example, the USA Supermarket chain known as Wal-
Mart serves more than 90 million customers weekly in the USA, Canada, China,
Mexico, Brazil and Argentina.
Global business means developing marketing strategies for major regions or for
the entire would. Nike, Apple computers, Delloite and Touche, and Coca Cola
gain a lot from global operations (Pride and Ferrel, 2000: 109).
Motivation for global operations There is a wide variety of reasons that make firms to start global operations. Some
of the reasons are briefly discussed below.
Accessing the Global markets promotes innovation while intensifying global
competition. The desire to make better, less expensive products has led
General Motors to develop products such as the Opel, Chevrolet, Cardillac,
and Saturn for use by customers all over the world.
When a firm engages in international marketing it becomes less exposed to
the dangers of economic fluctuations particularly in the domestic market. Thus
the firm may be faced with a declining domestic economy but the sales of its
products may be increasing in another part of the world.
Increased competition at the domestic level may lead to the loss of market
share. Consequently, the firm may be forced to go international or global.
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Occasionally firms may follow competitors who decide to operate internationally. This is known as the “me too” concept.
A firm may wish to take advantage of the faster rates of growth in demand for
its goods and services in the foreign markets.
Some firms may wish to dispose surplus commodities to increase their
production capacities.
The products sold by the firm may have reached the decline stage in the
domestic market. This creates a need for them to be introduced into the other
markets.
A firm may have special expertise/knowledge in the production of a product.
Such expertise or knowledge may not available in the foreign market.
In some countries the cost of labour is low hence setting up production
facilities in those countries ensures that the products are produced at lower
costs. With the advent of telecommunications and information technology,
work can be done more efficiently and effectively by engaging the best talent
all over the world.
Many companies, small and big, are finding that success depends on their ability
to market and manage oversees operation. This fact presents some interesting
management challenges. The market, products, and production processes must
be co-ordinated on a world wide basis and organisational structures capable of
balancing centralised home office control with adequate local autonomy must be
created. Firms must also make many decisions regarding the workforce. This
chapter will discuss all these issues.
Significant Global Changes Global marketing is a strategy in which essentially the same marketing program
is employed around the world. Probably the most re-known company around the
world associated with a globalized strategy is Coca-Cola. However, even Coca-
cola adapts its strategy to local markets. For instance, sizes of the bottles and cans
must conform to local regulations and costs.
One of the Global changes taking place is the formation of regional trade
alliances, markets and agreements. Examples of these are:
East African Community (EAC)
Economic Community for West African States (ECOWAS)
North Atlantic Free Trade Agreement (NAFTA)
European Union (EU)
Pacific Rim Nations
General Agreement on Tariffs and Trade (GATT)
Some of these trends and their human resource implications are discussed below.
a) North Atlantic Free Trade Agreement (NAFTA)
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NAFTA came to be in 1994 and effectively merged Canada, USA and
Mexico into one market of about 374 million customers. The USA and
Canada already had a free trade agreement since 1989 but NAFTA brought
Mexico into the consortium. The agreement was prompted by Mexico’s
increasing willingness to open its market and facilities in an effort to
promote economic growth. Some efforts have been made to expand the
membership of NAFTA to other Latin American countries such as Chile and
Brazil.
The aim of NAFTA was to eliminate all tariffs on goods produced and
traded between Canada, Mexico and the USA and to create a free trade
area by 2009.
NAFTA has increased USA investments in Mexico because of Mexico’s
substantially lower costs for lower skilled employees. For USA, this means
that:
Many low skilled jobs went south decreasing employment opportunity
for US citizens who lack high level skills.
It increased employment opportunities for highly skilled US citizens
because they could now work in any of those countries.
There was a greater pool for human resource managers to tap from.
b) European Union (EU) Also called European Economic Community or European Common Market,
the EU was formed in 1958 to promote trade among its members which
initially included Belgium, France, Italy, West Germany, Luxembourg and
Netherlands.
In 1991, East and West Germany united and the Berlin wall was torn apart.
By 1995, the UK, Spain, Denmark, Greece, Portugal, Ireland, Austria, Finland
and Sweden had joined the union.
In 1992, most of the EU members agreed to transform themselves to the
European Economic Community (EEC). The EEC members engage in free
trading with one another and the European Commission regulates their
business activities. To facilitate free trade, the EU is working towards the
standardisation of business requirements, import duty and VAT; the
elimination of custom checks and the creation of a standardised currency for
all members. The common currency, Euro, which began circulating in 1999
required business people to modify their pricing strategies and subjected
many firms to increased competition.
Companies selling goods and services among the European countries have
been saved the nuisance of dealing with many complex exchange rates. The
long-term goals are to eliminate all trade barriers among EU nations,
improve efficiency, and stimulate economic growth thereby making the
union economy very strong in the global market particularly against Japan
and other Asian nations.
c) Pacific Rim Nations
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Despite the economic turmoil and a recession in Asia in the 1990’s,
companies of the Pacific Rim nations – Japan, China, South Korea, Thailand,
Singapore, Hong Kong, Malaysia and Vietnam among others have become
increasingly competitive and sophisticated in global business in the last
three decades.
The Japanese in particular have made tremendous in-roads into the world
markets for automobiles, motorcycles, watches, cameras, audio and video
equipment among other products. For instance, Sony, Sanyo, Toyota,
Mitsubishi, Canon, Suzuki, and Toshiba products are sold all over the world
and have set standards of quality by which other products are often judged.
The Peoples Republic of China, a Country of more than 1.2 billion people has
launched a program of economic reform to stimulate its economy by
privatising many industries, re-structuring its banking systems and
increasing public spending on infrastructure. The potential of the Chinese
market is immense but doing business in China has many risks which
include political and economic instability (especially inflation), corruption
and erratic policy shifts. Moreover, piracy is a major issue and protecting a
brand name in China is hard.
South Korea has been very successful in the global market with brand names
such as Samsung, Daewoo and Hyundai becoming household names. Korean
companies are now grabbing market shares in Japanese markets for
videocassette recorders, colour T.V. and computers although the Korean
market for these products is limited.
Less visible and less stable Pacific Rim nations such as Singapore, Thailand,
Taiwan, Malaysia, Vietnam and Hong Kong have become major
manufacturing and financial centres.
d) General Agreement on Trade and Tariffs (GATT). This was signed by 23 nations in 1947 and provides a forum for tariff
negotiations and a place where international trade problems can be
discussed and resolved.
Currently it has over 100 member nations. One of the outcomes of GATT was
the formation of the World Trade Organisation (WTO) whose aim is to
resolve any disputes or conflicts between member countries.
In the recent past, GATT negotiations resulted in agreements to cut tariffs
(taxes on imports) by 40%, reduction of government subsidies to
businesses, expansion of the protection of intellectual property rights such
as copyrights and patents, and the establishment of rules for trading and
investing in services.
The changes taking place all over the world – the formation of trading blocks, the
growth of Asia, among others- are all examples of events that are pushing
companies to compete in the global economy. As a result of these developments,
new markets and new sources of technology are opening up very rapidly. Firms
must then be effectively managed so as to gain competitive advantages in the
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global market place. And because the success of every firm depends on the
calibre of the workers it has, then human resource management for a firm that
operates globally becomes a very important issue.
LEVELS OF GLOBAL PARTICIPATION
It is important to understand the stages through which firms pass through from
being local firms to global operators ( Adler and Ghadar, 1990). In many cases
firms go through four distinct stages or levels of operation namely:
Domestic level
International level
Multinational level
Global level
Domestic level Most firms start by operating within a domestic market place. An entrepreneur in
Kenya may have an idea to satisfy a certain need within a small area. He/she sets
production facilities in that area and the capital needed may be little. At this point
recruiting, selection, training and compensation of workers are done at the local
level. The focus of selection and training programs is on the employees’
technical competency to perform job related duties and to some extend on
interpersonal skills. Since the firm is involved in only one labour market,
determining the market rate of pay for various jobs is relatively easy.
As the product grows in popularity, the owner may choose to build additional
units in different parts of the country to reduce the cost of transporting the
product over long distances. The entrepreneur who started operations in Nairobi
may expand to Mombasa, Kisumu, or Nakuru.
In deciding where to locate these facilities the owner might consider:
The availability of workers with the necessary skills
The political stability in the area
Proximity of raw materials
Cost of labour in that area
Educational level of people in that area
Firms operating at the domestic level face challenges in relation to the political
legal cultural, human capital and economic areas but these challenges are less
than those faced by firms operating on a larger scale. A firm whose domestic
country is the US maybe faced with the challenge of an increasing number of
minorities and women in the labour force. This has to be dealt with by providing
facilities such as day-care facilities or even redesigning the jobs.
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International level of operation Increased competition at the global level may make the firm to lose market share
in which case the firm responds by seeking alternative markets for its goods and
services. The firm may opt to enter the international market gradually, beginning
with exporting the products but ultimately by building production facilities in the
other country.
A firm which decides to engage in international competition must make many
decisions such as the ones below.
In deciding where to allocate production facilities, one must consider
whether a particular location provides an environment where human
resources can be successfully acquired and managed.
The country’s legal system may also present other problems. For instance,
France has a relatively high minimum wage which drives labour costs up
and the laws in Germany allows employees to participate in the firm’s
board of directors , a concept known as co-determination. Thus there may
be a need to adapt to practices in the other country and to conform to their
labour laws. In some countries the law requires you to employ a certain
percentage of the local people ( i.e. the host country nationals) as a way of
ploughing become the profits of the firm into the society from which the
profits came.
Cultural differences may present conflicts, communication and morale
problems.
At this phase international HRM becomes manifest as managers are assigned to
posts in the foreign markets to provide general management, technical expertise
and financial control. Further, selection criteria such as technical competence,
language skills, cross cultural adaptability and sensitivity are also important. Host
country nationals are frequently recruited in the areas of sales, marketing and
personnel because they have a better understanding of the local circumstances.
Multi-national level Multinational companies build one or more facilities in another country or in a
number of countries. The South Korean firm, Samsung, has facilities in UK,
Germany, Portugal and Slovakia among other countries. Other multinational firms
include Mitsubishi, Mitsui, Itochu, General motors, Sumitomo, Marubeni, Ford
Motor Company, Toyota Motor, Exxon, and the Royal Dutch/Shell Group.
Firms locate in many countries so as to take advantage of lower costs of
production in the other country. Many firms from US have shifted to Mexico
where the cost of labour is low; General Motors has a production facility in UK.
This enables it to produce for the European market. The production and
distribution cost is lower if the production is done in Europe.
The Human Resource manager of multinational companies must understand the
definitions used in these firms:
Home country/parent country/Domestic Country - it is the country
in which the firm has its headquarters. The USA is the home country for
General Motors; Japan is the home for Mitsubishi and Toyota motor
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corporations; Germany is the ‘domestic country for the Mercedes Benz brand
of motor vehicles
Host country - This is the country in which the firm has located its
operations. The UK is a host country for General Motor Corporation.
Third country - it is any other country the firm has or doesn’t have operations
but with which it interacts eg as a source of raw materials.
Home country nationals - these are people born and living in the
domestic country; some may be working for the company.
Host country nationals – these are the employees who were born and
raised in the host country and not the parent country. Examples are the
Kenyans working for General Motors in Kenya.
Third country nationals - they are the employees working for the
company but who are not from the parent or host company. An example would
be a Tanzanian working for General Motors in Kenya.
Expatriates - these are employees of the firm who operate in many
nations. The HR Manager has the challenge of selecting expatriates, who are
capable of operating in different settings, train them, and provide them with
flexible compensation systems that take into account the different marker
rates, tax systems and cost of living.
Multinational companies should employ many “in-patriates”- managers from
different countries working in the corporate headquarters. These are mainly
highly knowledgeable and competent staff who are to spearhead the firm’s
strategy. The different managers may have different cultures therefore there may
be a need to integrate the people from the different cultures who are working in
the corporate headquarters into the culture of the company.
Multinational enterprises also take managers from other countries and place them
in facilities in other countries. An example would be a manager from Kenya
working for a USA firm in Nigeria being transferred to head operations of the
same firm in South Africa. This practise creates the need for cross-cultural
training to provide managerial skills for interaction with individuals from different
cultures.
Firms operating at the multinational level seek to recruit the best managers
regardless of their country of origin. The human resource manager is also
interested in ensuring that all members share the same organizational norms and
values, irrespective of the fact that they come from different countries. Other HR
activities involved include management development, career counselling and
periodic transfers to different assignments (after a specified number of years).
Global level of operation. Global organisations compete on the state of the art (latest, top quality) products
and services and gain competitive advantage by achieving the lowest costs
possible.
Multinational enterprises normally develop identical products and distribute
them on a large scale while global companies produce products to meet the
needs of particular clients. The products are customised, produced in masses but
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adapted to different geographical areas. For example, Nokia has different
fashions, Coca-Cola packages vary from country to country- these goods cannot
be easily moved from one country to another without being noticed. Multinational
companies locate their facilities in a country as a means of reaching that country
sufficiently and effectively; Global companies locate its production in a country as
a means of serving that region. The global firm may need to create synergy in its
operations by integrating different cultures.
As a firm enters the global market place, the HR manager must encourage
flexible systems in HRM such as the following:
Since global companies have many corporate headquarters the
employees should be selected, trained and compensated in such a way
that they can operate trans-nationally.
The trans-national scope of the global HR manager refers to the fact that
HR manager decisions must be made from a global rather than a national
or regional perspective. There should be uniformity/fairness in the
treatment of all employees with minor variations to accommodate for
differences in taxation, cost of living, security and so on since every
country is different from the other.
The employees and managers of the global company must have a trans-
national representation. This implies that every country is represented
either by a manager or employees or in the employment practices.
The trans-national process refers to the extent to which the company’s
planning and decision making process includes ideas and
representatives from different cultures. The human resource manager
should see the strength of diversity in the different cultures and consider
the best practices in each culture in decision making.
Trans-national representation reflects the multinational composition of a
company’s managers. Global participation does not mean that every
country is providing managers to the company’s branches.
Successful organizations need HR managers who will treat employees and
managers from different cultures equally. This can be accomplished through
combining selection, training, appraisal and compensation systems in such a way
that managers have a trans-national, rather than a local orientation.
GLOBAL RECRUITMENT AND SELECTION Introduction
There are four approaches to managing and staffing international subsidiaries.
These are:
Ethnocentric approach
Polycentric approach
Regiocentric approach
Geocentric approach
Ethnocentric approach This is a situation whereby top management and key positions are occupied by
people from the home country. This applies to those firms where the top
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management believes that home country attitudes, management styles,
knowledge, evaluation criteria, and managers are superior to anything the host
country may have to offer. At Royal Dutch Shell, for example, most financial
officers around the world are Dutch nationals. Japanese firms are also famous for
being ethnocentric.
The ethnocentric approach is used where there is no qualified host country senior
management talent, where there is a desire to maintain a unified corporate
culture and tighter control, and where there is a desire to transfer the parent
firm’s core competences to the foreign subsidiary more expeditiously.
Polycentric approach International subsidiaries are managed and staffed by personnel from the host
country while the home office is run by parent country nationals. Examples are:
General Electric’s operations in Hungary include 8 factories and more than
8,000 employees most of whom are Hungarians.
Coca-Cola operates in over 160 countries and employs half a million
people world-wide.
In the polycentric corporation, there is a subconscious belief that only host
country managers can ever really understand the culture and behaviour of the
host country market; therefore the foreign subsidiary should be managed by
local people.
This approach reduces the cultural misunderstandings that would arise if
expatriates were used. The locals may also be less costly to hire.
Regiocentric approach This occurs where the staffing of the foreign subsidiaries is done on a regional
basis. An example is a situation where a European subsidiary is staffed by
Europeans from Britain, France, Germany and so on. A firm in Kenya may be
staffed by employees from the East African Region. The catholic University of
Eastern Africa draws the majority of its employees from Kenya, Uganda, Tanzania,
Rwanda, Burundi, Malawi, Ethiopia, and Eritrea.
Geocentric approach The firm ignores nationality deliberately and it searches on a world-wide basis
for the best employees to fill its positions. This is because of the assumption that
the best manager for a specific position anywhere may be in any of the countries
in which the firm operates.
This approach is used by global trans-national firms such as:
- Bosch ( for handsets, iron boxes, car spark plugs)
- Electrolux ( vacuum cleaners)
- Ford motor company.
The geocentric approach ensures a global culture is built. The human resource
department is also able to use its resources more efficiently by being able to
transfer its managers any where in the world.
Local and expatriate staff
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The human resource manager makes a careful decision whether to use locals or
expatriates. Expatriate staffs are very costly. In the year 2000, the average cost of
an expatriate in Japan was $473,390 per person per year; in the US it was
approximately $88,000- $253,000 per person per annum. Due to the high cost of
expatriates their use should be limited to situations where the local talent is not
available. The use of locals and expatriates has both advantages and
disadvantages ( Hamil, 1989).
Use of locals
Advantages Disadvantages
Lower labour costs
It makes it difficult to balance local
demands with global priorities
It demonstrates trust of the company in
the local citizens. Locals then perceive
the company as a better citizen. In some
cases, the host country government may
press for the “nativization” of local
management.
It makes it difficult to take decisions
that affect locals negatively
examples of which are lay offs.
Maximises the number of options
available in the local environment
It is difficult to recruit qualified
personnel because the recruitment
pool is limited.
It leads to recognition of the company as
a legitimate participant in the local
economy
It reduces the amount of control
exercised by the head office.
It effectively represents local
considerations and constraints in making
decisions specifically the culture of the
country is easily incorporated.
They are familiar with local markets, the
local communities, the local setting and
the local economy.
They speak the local language and they
are culturally assimilated.
They can have a longer term perspective
of the operations of the firm as opposed
to expatriates.
Use of Expatriates
Advantages
i. Since they come from the parent country, it is easier for them to transfer
business and management practices from their country to the other. They
are assumed to be well versed with the firm’s policies and cultures.
ii. It is easier for the headquarters to control them because they have been
sent by the headquarters.
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iii. The employees are given a multinational orientation since they are rotated
in different countries. In fact multinationals view a successful stint abroad
as a required step in developing managers.
iv. The use of expatriates creates a pool of experienced employees who can
be taken to any part of the world to head operations.
v. They possess unique skills which are not available at the local level. Thus
they should have more technical competences than local employees.
vi. They have a broader global perspective in decision making.
Disadvantages
i. They make the firm look “Foreign”
ii. They may have difficulties in adapting to the cultures of the host country.
iii. They are very costly e.g. high transfer costs, high salaries and other costs.
iv. It may result in personal and family problems for the affected employees.
v. It may discourage the local people when employment positions in the firms
are taken by foreigners.
vi. The expatriates may be subject to government restrictions in areas such as
salaries earned.
When to use Expatriates
Although expatriates are very expensive sometimes a firm may be forced to use
them. Firms rely on expatriates when:
i. Local talent is not available - this occurs mainly in developing countries (in
Africa, Latin America, etc).
ii. Where the firm wants to develop a global corporation -wide vision. Some
firms want their subsidiaries to have the same vision as the headquarters.
This can be achieved using expatriates from the headquarters.
iii. When the operations at each subsidiary are highly interdependent. In
some cases the output of one subsidiary is the input of another subsidiary.
To ensure quality each subsidiary is staffed by expatriates. Examples are
IBM, Hewlett – Packard and Xerox which have specialized manufacturing
facilities in different parts of the world. The output of these facilities
(computer chips, software) must be integrated to produce highly
sophisticated products such as computers, medical equipment and
photocopying machines. Linking production processes generally calls for
greater reliance on expatriate managers and specialties which can bridge
the gaps and tie the units of the entire organization together.
iv. When the political climate is unstable - corporations tend to rely on
expatriates for top management when the risk of government interventions
is high, when actual or potential turmoil within the country is serious, when
the threat of terrorism exists and when there has been a recent history of
social and political upheavals in the country. Generally, expatriates are
less prone to the demands of local political parties. The expatriates
provide reassurance to the home office that its activities are well taken
care of.
Off shoring
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This is using local employees abroad to do jobs that the firm’s domestic
employees previously did in -house. This trend is growing especially in US
because it provides cheap labour which substantially reduces the costs of
operation. Off shoring can be done electronically through the use of call centres
e.g. Kencall. Nevertheless, off shoring remains a controversial topic.
Off shoring is a HR dependent activity because employers expect the HR
directors to help identify high quality, low cost talent abroad and to provide the
necessary background data on things like wage rates, working conditions, and
productivity.
The HR challenges of off shoring are:
Identifying the source of low paid, high quality, technically competent
workers.
Establishing an effective supervisory and management structure to
manage the workers.
Ensuring that all the employees receive the careful selection and training
they require.
Ensuring that the compensation policies and working conditions are
satisfactory.
Failure of expatriate assignments Despite the many advantages associated with expatriates, many expatriates
assignments end up in failure. Failure may be indicated by an early return,
increased operation costs, lower productivity, low morale and poisoned customer
and staff relations.
Some of the reasons why expatriate assignments fail are:
i. Career Blockage
Initially many employees are excited about the opportunities for travelling
abroad. Afterwards they may feel that their home office has forgotten them
and that their careers have been side tracked as they get reports of their
counter parts at home climbing the corporate ladder. Women face
additional difficulties in international assignments especially where the
majority of male managers believe that women are less likely to succeed
overseas. Japan, Arabic and other Asian countries are examples of places
where women are rarely promoted to management positions. Nevertheless
it should be noted that what matters most is core competences, not gender.
ii. Cultural shock
Many people who take international assignments may not be able to adjust
to a different cultural environment. This leads them to impose their own
country’s culture on host country’s employees, a practice which may lead
to cultural clashes and misunderstandings. Occasionally the clashes may
escalate until the expatriate decides to return home after being frustrated
and frustrating others.
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iii. Lack of pre-departure cross cultural training
Few multinational enterprises provide cross–cultural training and those
who do so provide limited training. Often expatriates and their families
pack their bags and travel to their destination with only their passports and
legal documents and limited information gained from maps, tourist
brochures, and the library.
iv. Over emphasis on technical qualifications
A person chosen to go abroad may have impressive credentials and an
excellent reputation in home office for getting things done. Nevertheless, it
should be noted that the traits needed to succeed in another country may
be different from those needed at the domestic country.
v. Getting Rid of a troublesome employee
Sometimes firms may send an employee on an international assignment as
a way of getting rid of them. This may look very good in the short run but it
will lead to the manager failing and by extension the firm failing. Thus the
wrong intentions can lead to failure.
vi. Family problems
In some cases, the expatriates spouse or children may be unable or
unwilling to adapt to life in another country. This is one of the most
important reasons for failure.
To ensure success, the spouse could be provided with language training.
Couples chosen for international assignments should be those with pre-
school age children; it is easier for them to adjust. The family should also
have a strong bond of closeness and mutual sharing.
Other approaches to achieve success include shortening the length of the
assignment, providing realistic views of what to expect, careful screening,
improved orientation, improved benefit packages and treating the
expatriate with dignity.
vii) Personality
Expatriate employees who are extroverted, agreeable, and emotionally
stable are less likely to fail.
Difficulties experienced on return
Often, expatriates returning home may have many difficulties. These
difficulties may force the repatriates to leave the organization shortly after
returning home. Ideally some of the difficulties that may be experienced
on return include Lack of respect for acquired skills, Loss of status, Poor
planning for return position, and reverse cultural shock.
Failures can be very expensive - some of the more tangible costs of failure
include business interruptions, lost business opportunities, negative
impact of the firm’s reputation, and personal hardships on the people
involved and their families. These hardships can take the form of
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diminished self-image, marital strives, destabilized children, tarnished
career reputation, and lost income.
Selecting expatriate managers. The success of an international assignment is influenced by job knowledge
and motivation, relational skills, flexibility/adaptability, extra cultural
openness and the family situation.
An interview worksheet for international candidates will look at variables
related to motivation for the assignment, health, family considerations,
resourcefulness and initiative, adaptability, career planning and financial
considerations.
To ensure that expatriates don’t fail, it is important to look at the following
factors:-
i. Emphasize cultural sensitivity as a selection criteria
The firm should assess the candidate’s ability to relate to people from
different backgrounds.
ii. Establish a selection board of expatriates
Some human resource managers/specialists strongly recommend that all
international assignments be approved by a selection board consisting of
managers who have worked as expatriates for a minimum of 3 – 5 years.
This is because such managers have the experience required to detect
who can fail and who can succeed.
iii. Require previous international experience
In some cases, it is highly desirable to choose candidates who have
already spend some time in a different country.
Business schools which offer overseas internships make their students
acquire some knowledge of a country’s language and customs by taking on
a full blown expatriate assignment.
Companies like Colgate-Palmolive therefore look for overseas candidates
whose work and non-work experience, education, and language skills
already demonstrate a commitment to and facility for living and working
with different cultures.
iv. Explore the possibility of hiring foreign born employees who can
Serve as “expatriates’ at a future date
Japanese firms have been quite successful at hiring young foreign born
(non-Japanese) employees immediately they are out of college so as to
work in their home office in Japan. Such people can later be posted as
expatriates else where.
v.Screen the candidate’s spouses and family
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An unhappy family can be a source of frustration and failure for an expatriate. It is
therefore necessary to screen the candidates’ spouses and children. For
example, Ford Company normally screens the spouses on qualities such as
patience, flexibility and adaptability. Exxon also meets with spouses and
children during the selection process.
Global Training and Development Careful recruitment and selection is just the first step in ensuring that the foreign
assignment succeeds. The trainee must be prepared for the upcoming
assignment. One such preparation is through training. An example of training
would be a one day pre-departure training workshop. This would emphasize
language skills, nation and culture orientation, personal and family orientation,
and career planning.
However, many firms prefer a continuous in-country cross cultural training during
the early stages of an overseas assignment. Here, the emphasis is on language
skills, local mentoring, stress training, and training on business issues. The first
session of the training could be orientation training.
Training tends to be individually focussed with a present or near future time
frame. It seeks to address particular deficiencies in individuals and to develop
competences so as to improve the performance of the individual.
Development is broader than training because it seeks to improve organizational
performance over the long run. In fact most training is done for the managers of
the organization.
Training and development for global firms is constrained by the concepts of
geographic dispersion and multi-culturism. This implies that the firm operates
across cultures yet its workers, customers, and suppliers are from different
cultural backgrounds. This is complicated by the fact that the management may
need to balance between centralization (degree of tight control by the
headquarters) and decentralization. Both centralization and decentralization have
advantages and disadvantages. Some of the advantages of each of them are
briefly listed below.
The advantages of extreme centralization are:
Economies of scale in areas such as in purchase of raw materials
Improved value chain linkages
Product/service standardization
Global branding.
Extreme decentralization can be strategic in that it will enable a firm to modify its
products or services to fully meet local customer needs, respond to local
competition, remain compliant with various government regulations in different
countries, attract local employees, and penetrate local business networks.
The main objective for training in global firms is to provide managers with the
competencies needed for the successful transfer of technology, organizational
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culture and organizational philosophy from the headquarters to the subsidiaries,
to work effectively with and manage subsidiary staff, and for expatriates to live
comfortably in the new culture (Adler and Bartholomew, 1992). Those managers
who are returning home could be very instrumental in training the ones who are
beginning their assignments.
One major approach of developing managers is through rotating assignments.
These assignments permit managers to form bonds with colleagues around the
world and to make cross border decisions more expeditiously. IBM uses rotating
assignments to help its managers to grow professionally. At other times, a firm
may decide to have periodic seminars which bring together the managers from
around the globe so that they can share their experiences with each other. The
use of software and internet (including video clips) for cross cultural training is
also becoming common.
The table below indicates some of the main types of training and development
initiatives used by global firms.
Training & development initiatives Goals Cross-cultural orientation ( pre-
departure)
Comfortably live and work in the
host country.
Cross-cultural training ( in-country) Increase cross cultural adjustment.
Diversity training Increase ability to understand and
appreciate multiple cultural
perspectives.
Language training Fluency in another language
Traditional education in
international management
Increase international business
acumen and knowledge
Organisational Behaviour To learn how attitudes are formed
and how change is managed
Individualized coaching or
mentoring on cultural experiences
Build cultural awareness; work on
cultural “blind spots”; develop
competencies for becoming an
effective global leader.
(Deep) Immersion cultural
experiences
Build extensive understanding of the
local culture and increase ability to
understand and appreciate multiple
cultural perspectives.
Cross border global teams with
debriefing
Learn skills to be a better leader (or
team member) with multiple
cultures involved in the team.
Global meetings with debriefing or
coaching
Learn skills to conduct a better
meeting when multiple cultures are
involved in the meeting
International assignment rotations
with debriefing or coaching
Develop a deep appreciation for the
challenge of working in another
culture; increase global leadership
competencies.
Repatriation training To help the employees manage their
careers and finances better on
return and to avoid re-entry shock.
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From the above table, it can be summarized that oversees candidates require to
be trained in four areas namely:
a. Cultural information This level of training focuses on the impact of cultural differences and it aims to
raise the trainees’ awareness of such differences including how such differences
impact on business outcomes.
The beginning point will be to make the expatriate clear about his or her own
cultural background and how their culture is perceived by the host country
nationals. For example Tanzanians perceive Kenyans as always being in a hurry,
Europeans perceive Kenyans as being poor time keepers and Kenyans perceive
Nigerians as being aggressive, fraudsters and drug traffickers. Americans are
perceived to be in a perpetual hurry (in India), to keep a distance (Kenya),
always obey rules even when the rules look minor (Turkey), motivated only by
work (Colombia), talk and analyze even minor issues (Indonesia), answer with a
“yes” or a “no” response (Ethiopia), and ready to admit what they don’t know
(Iran). With an accurate cultural self awareness managers can modify their
behaviours to reduce dysfunctional characteristics.
It is also important for the expatriate to understand the culture of the host country
and possibly adapt to it. The emphasis is on those types of behaviours and
interpersonal styles that are considered acceptable in both business meetings
and social gatherings. For example, Germans value promptness for meetings. An
important aspect of adaptation is the ability to speak the host country language. It
is rare for expatriates to speak the host country language fluently, but the ability
to communicate in that language is extremely important.
Training on the host country’s culture helps the expatriate to avoid costly
mistakes and to adjust to the new work environment more quickly.
b. Factors influencing behaviour This type of training is aimed at getting participants to understand how attitudes,
both positive and negative, are formed and how they influence behaviour. This
relies heavily on behavioural sciences such as Organizational Behaviour and
Principles of Management
c. Information on the target country This level of training provides factual knowledge about the target country where
the expatriate is going to be based. As much information as possible should be
provided at this stage. In this way, “surprises” can be avoided. For expatriates to
adjust quickly to the new environment, it is recommended that they engage in
activities such as walking around to know the neighbourhood, using public
transport especially taxis to get around, doing shopping in a mall, learning the
local values of currencies rather than calculating their equivalents, talking to the
local people, reading local newspapers, watching local news, attending social
functions including religious services, visiting the museums and go sight seeing
among other activities.
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d. Change management It provides skill building in areas such as adjustment and adoption of new skills.
This is because accepting the global assignment is accepting change. One must
then be competent in change management.
Besides these special training needs managers abroad should continue to
undergo additional training and development using methods such as Seminars
and workshops, University and college programs like the Executive MBA among
others. Business schools that have a global reputation for training managers
include London Business School, INSEAD in France, Harvard Business School, and
Massachusetts Institute of Technology among others.
After a successful period of a global assignment, repatriation training is offered in
the areas of financial management, re-entry shock, and career management.
The concept of training and development varies from country to country but in
many countries it is supposed to improve the technical abilities of the employees.
In Asia, employees are trained for an average of 26 hours, while in Europe, they
are trained an average of 49 hours per year. Classroom training is the most
common method of training workers.
INTERCOUNTRY DIFFERENCES AND SIMILARITIES
Dealing with human resources on a global scale presents many complex issues
especially in the areas of candidate selection, terms and conditions of service,
relocation processing, immigration processing, cultural and language
orientation, compensation administration, payroll processing, tax administration,
career planning and development, and the handling of spouse and dependants.
Besides, the human resource manager has to deal with differences that exist
between one country and another. Some of the inter-country differences and
similarities are explained below.
1. Cultural Differences
Countries differ widely in their culture, where culture refers to the things valued
and adhered to by the citizens.
There are many definitions of culture; however cultural elements include
language, religion, social organisations, aesthetics, and education and so on.
The main cultural factors of interest to a human resource manager are
summarised as below:
Language
Religion (belief systems)
Aesthetics (art, music, drama, dance, folklore)
Cultural universals
Cultural adaptations
Cultural borrowing
Attitude and values
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Social organisations (education, political structure)
Material culture (technology and economics)
Reference groups
Culture is shared and transmitted from one generation to another. Family units,
social institutions, religious organisations or even the state passes on the Culture.
Moving from one culture to another is problematic and employees may need to
make adjustments in order to work or even communicate in different areas.
Employees who are not able to make cultural changes may be caught up in a
cultural trap.
Some of the cultural variables that are of interest to global human resource
managers across the globe include:
a. Religion Three quarters of the world’s population can be classified into the
following religions in order of numbers:
Christianity
Islam
Hinduism
Buddhism
Shintoism
Animism
Some of the impacts of religion on human resources and business activities
are as follows:
i. In most Western European countries, the work ethic is seriously
encouraged. Hard work and success is a key value of the Christian
teaching. Success is often measured in terms of wealth acquisition.
In contrast Hinduism, as practised in India does not encourage the
acquisition of wealth. Employees who embrace the Hindu religion
may not be so determined to work hard since they lack the
motivation to acquire wealth.
ii. Certain religions prohibit certain businesses. For example,
Hinduism prescribes abstinence from beef consumption; Islam
prohibits pork and alcohol; and Judaism prohibits the consumption
of pork and shellfish. In these markets there is a large market for
non alcoholic beverages and vegetarian products.
iii. Religion also influences dress, gender roles, and social institutions.
For instance, the role of the Muslim woman is mainly restricted to the
household.
iv. Religious divisions can also cause instabilities in certain areas. For
example, in the Middle East, clashes between Muslims and
Christians have been common. Religious conflicts have also been
noticed in the Indian Kashmir region.
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v. Religious holidays also affect working patterns. For instance, before
1996, all shops in Germany remained closed on Sundays while in the
Muslim world virtually all type of work slows down during the month
of Ramadan. In the Muslim world, religion is a total way of life while
in the western world, religion is an aspect of life and causes minimal
business interruptions.
b. Language It is important to understand the official and business language in every
country. In some countries such as Canada, China, Switzerland, Nigeria,
India, and Belgium, two or more languages are spoken. English is the
official language while French is considered as the language of diplomacy.
One must recruit employees who can speak the language of the area the
business operations are located in.
Occasionally language translators may be required. Care should be taken
in the process of translating because words can lose meaning or have poor
connotation. For example “Body by Fisher’ was translated as “Corpse by
Fisher”.
In different countries, the same word may have a different substitute. For
instance, in Britain petrol, biscuits, plimsolls, and pavement will be
translated respectively in USA to gasoline, cookies, sneakers, and
sidewalk.
In the UK a large office is reserved for a very important person while in
Japan offices are shared. In European countries keeping time is
considered polite and reliable; in Indonesia, coming late for an important
meeting is respectable. In Germany, lateness is never tolerated and senior
people are always addressed formally and with their titles.
c. Education The educational system in a country leads to the creation of human capital. Thus
human capital is the availability of skilled manpower in a country. It is
determined by the educational system. In USA there is a high human capital
shortage because the jobs created require more skills than are available.
Germany also has a human capital shortage. In Netherlands the education system
is free all through to the university, thus there is plenty of human capital; Russia
has a free education system in spite of its poor infrastructure and economy. Some
third world countries (e.g. Nicaragua, Haiti, Sudan, and Somalia) have relatively
low levels of human capital because of little investment in education.
A country’s human capital may affect a foreign company’s desire to locate there
or enter that market. Countries with low human capital attract facilities that
require low skills and low wage levels. This explains why Japan has shifted low
skilled work to some of its neighbours while maintaining high skilled work at
home. Countries with high human capital have attractive opportunities for direct
investment. An example is Ireland, which has 25% of all its youth attending
college. This is much higher than many other European countries.
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The combination of high educational levels, a strong work ethic, and high
unemployment makes a country attractive for investors because of the resulting
high productivity and low turnover.
The educational system in a country also has many other implications. Examples
are:
Where the educational system is poorly developed, there will be a shortage of
trained people.
The level of education determines how the business will be conducted. The
promotion of products depends on the educational level of the citizenry.
d. Aesthetics This deals with perceptions of beauty and different meanings of colour. For
example, In the UK, the colour black is normally worn in funerals while in Brazil
funerals are attended in purple. In Japan, gift items should not have the name four
in them because its pronunciation is associated with death. Similarly white
flowers are associated with death in Japan while red is a good luck colour in many
oriental cultures such as in China. White and green are associated with death in
Muslim countries. In Kenya, green is associated with “mother nature”, white with
purity, black with sophistication, blue with high levels of achievement, and
red/yellow with “fast moving”, “hot”, “trendy things”.
e. Social Organisations This defines how people relate to each other and is expressed in:
The roles of men and women in the society
Social classes
Family
Group behaviour
Marriage
Rituals
The role men and women play in the society varies from culture to culture.
Some cultures are feminine while others are masculine. For example, in Germany
and Japan the masculine aspect is emphasised and is shown through showing off,
achieving something visible and making money. The human resource manager in
that culture must stress assertiveness, performance, success, and competition.
Feminine cultures are found in Sweden and Norway and emphasise on putting
relationships before money, helping others, and protecting the environment. The
human resource manager should stress on service and care for others.
In developed countries such as the USA, the women and men are competing in
the work place. Gender roles are becoming invisible and less predictable. In
some less developed countries, women and men compliment each other. For
instance, in the Middle East it is women who purchase goods hence all
promotional and selling activities should be directed towards the women.
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Social class – In every country, people are grouped into social classes using
criteria such as income, occupation, education levels, religion, wealth and so on.
In the UK there are three main social classes namely the Lower, Middle, and
Upper social classes as determined by occupation. In some cases it is possible to
move from one social class to another through say, attaining higher levels of
education. In other cases such as the Indian “caste” system the social class is
defined by purity, spiritual quality and power and these are determined at birth.
In such cases, one cannot change their social class.
Values and attitudes - these are beliefs about products, businesses and so on
and they maybe based on real facts, opinion, or faith. They are very hard to
change and managers should learn to take advantage of them. A person with
appositive attitude towards Kenyan products will continue to purchase them.
The family unit is a fundamental unit of social organization in many societies. In
many parts of Europe, the typical household is nuclear in nature while in other
countries (India, parts of Africa, the Far East), the family can be extended to even
two or three generations. The family unit can determine many decisions ranging
from the sizes of goods purchased to the most appropriate communication
methods.
F) Cultural universals
These activities occur across cultures and include gestures, music, personal
names, courtship, and trade among others.
Implication of Culture on Human Resource Management
Some of the effects of culture on human resource management are briefly
explained below.
a. Culture determines how the employees perceive managers, what
motivates the employees and roles that managers are expected to play. In
Germany all managers are expected to show technical competence. Employees
therefore perceive managers as solutions to all their technical problems.
Moreover, senior people are always addressed formally with their titles. In
Netherlands, managers focus on seeking consensus among all parties and they
encourage open exchange of views and a balancing of interest. In Mexico,
workers expect managers to keep their distance, to be formal rather than
informal; they also expect the managers to occasionally give them gifts such as
food baskets. The managers selected for each region must be able to meet
expectations for that region.
b. Culture affects the selection, training, performance appraisal,
compensation administration systems among other personnel practices.
Examples are as follows:
In individualistic cultures such as found in the USA and UK, people are
expected to look after their own interests and those of immediate family
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members. In these countries, every individual is analysed alone when it comes to
selection, training, and performance appraisal.
In collectivist cultures (e.g. Columbia, Pakistan, Taiwan) people are
expected to look after the interests of society. Performance appraisals would
emphasise how one fits into the larger organisation.
c. Culture influences compensation systems. Individualistic cultures are such
that the gaps between the highest paid and the lowest paid individual in the same
organisation can be even 200 times. Collectivist cultures emphasise flat pay
structures with the gap between the highest and lowest paid being less than
twenty times.
d. Culture affects the common systems and co-ordination system. For
example, collectivist cultures promote participative decision making as opposed
to individualistic decision-making.
2. Economic Systems
A country can be practising capitalism, socialism, or communism. In socialist
economic systems, there are many opportunities to develop human capital
because the education system is free. A case in point is Russia. However, such
systems have little incentives for the developed workforce.
In capitalistic systems, the cost of developing human capital is high. Consider the
case for Kenya. However, those who invest in education benefit greatly. The level
of education has some relationship with income levels. Additional years of
schooling may result in increased income.
The health of the economic system also has a bearing on human resource
management practices. For example, wealthy nations have relatively high cost of
labour.
A 2001 study revealed the following wage rates in different capitalistic countries:
Country Cost in $/Hour Sri Lanka 0.47
Mexico 2.12
Portugal 5.48
Greece 8.91
Britain 16.56
Italy 16.60
France 17.98
USA 19.20
Japan 20.89
Netherlands 20.94
Sweden 21.58
Austria 21.83
Switzerland 23.56
Germany 26.18
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The economic system determines the tax systems. Socialist countries have a tax
system that aims to redistribute wealth.
Different countries have different tax rates;
Country Highest Tax USA 40%
Germany 56%
France 54%
Britain 40%
Netherlands 60%
Sweden 55%
Japan 46%
South Korea 44%
Kenya 30%
Companies must compensate their expatriates considering differences in tax
rates among other factors.
Per capita incomes also vary from country to country and it may be necessary to
adjust for the purchasing power parity from one country to another. Other
economic variables of interest to a global human resource manager are
consumption patterns, infrastructure, urbanization, economic integration and
trade blocs, inflation rates, and the influence of the World Bank/International
Monetary Fund in each area where the firm is operating.
Differences in economic systems affect human resource practices. For example,
France is a capitalistic country but has put many limitations on workers. The
human resource managers are legally forbidden from discharging workers and
the government limits the maximum numbers of hours one can work. This
contrasts the situation in other capitalistic countries (USA, UK) where workers can
be laid off anytime and there are no maximum working hours.
There are also other differences in labour costs that need to be considered. These
include the number of hours worked per day or per year. Examples are given
below:
In Portugal an average worker works for 1980 hours per year
A Kenyan employee puts in around 1752 hours per year
In Germany an average worker works for 1648 hours per year
Severance pay varies from country to country. For instance, in UK departing
workers should be paid an amount equivalent to what they would earn in 2 years.
In Germany, the severance pay is at least one year’s salary. In Kenya, the
severance pay is calculated at not less than 15 days pay for every year worked.
(Source: the Kenyan Employment Act 2007).
3. Political, Legal and Industrial Relations Differences
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Each country has its own laws which have a bearing on its recruitment, training
and compensation of employees. The European Economic Community legal
system allows employees’ fundamental freedoms such as:
Freedom of movement.
Freedom to choose one’s occupation and be fairly compensated.
Social protection via social security benefits.
Freedom of association and collective bargaining.
Equal treatment for men and women.
Safe and health working environment.
In Germany, the law allows for co-determination whereby employees participate
in making decisions that affect payment methods, training, transfer, and working
hours among other areas. The workers representatives also sit in the Board of
Directors meetings. This contrasts the situation in USA where policies, rules, and
regulations are set by the employer and workers’ representatives never sit in the
board. Similarly, in Kenya very few firms would allow employees to sit in their
board of directors.
In USA the laws allows for:
Non-discrimination (based on age, gender, nationality etc.) in the
Workplace.
Equal employment opportunities (the Equal Employment Act
regulates the hiring and firing practices of firms)
Fair labour standards- the minimum wages Act regulates minimum
wages for a variety of jobs.
Regulations governing negotiations between unions and
management have also been set in place.
In many European countries, there are no trade unions. Workers channel their
grievances through “workers councils.” A work council is a formally elected
group of workers’ representatives that meet with the management every month to
discuss issues affecting workers ranging from non-smoking policies to holidays,
bonuses, profit sharing, lay offs and so on.
Thus, every country varies in terms of its culture, human capital, legal systems,
and economic systems. These variations directly influence the type of human
resource management systems that must be developed to accommodate each
particular situation.
Compensation of expatriates Firms can use compensation packages to enhance the effectiveness of expatriate
assignments. In compensating expatriates, some of the thorny issues considered
include:
What components to include in the wages (base pay, variable pay,
perquisites, benefits, incentives)
Where to establish the compensation basis (is it the home country, the host
country, or some other variation?)
Tax protection (how to protect expatriates’ compensation packages against
the effects of additional foreign taxation)
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Who should be paying (is it the home, host, or parent companies or should
it be split among the companies?).
Compensation policies can create conflicts if local employees compare
themselves with expatriates and find there is a big disparity between them. The
following guidelines can assist in compensation of expatriates:
i. Provide the expatriate with income which is equal to what they
receive at home. This approach of equalizing income of expatriates
across the countries considering the purchasing power in each country is
known as the “balance sheet” approach.
The basic idea is that each expatriate should enjoy the same standards of
living he/she should have at home. The balance sheet approach focuses
on the following main expenses:
Income taxes ( paid to federal and local governments)
Cost of housing ( for a principal residence)
Cost of goods and services ( food, personal care, clothing, recreation,
transportation)
Discretionary expenses (child support, car expenses etc.)
Reserve (savings, payments for benefits, pension contributions).
Shipment and storage (costs associated with moving and/or storing
personal belongings).
The employer estimates what each of these expenses is, in the expatriates
home country and what it is in the host country. The employer then pays
any differences between the two.
ii) Provide an explicit “add on” incentive for accepting an
international assignment. These incentives take many forms. The
company may provide a ‘sign on’ bonus before departure or it may
offer the employee a percentage increase of the home based salary.
Other firms may offer a lump sum upon successful completion of the
foreign assignment while others offer a combination of these incentives.
The greatest incentives are normally reserved for the least desirable
location such as Eastern Europe (Russia) where there is poor air quality,
political instability, and unattractive housing.
iii) Avoid having expatriates fill the same jobs held by locals or lower
ranking jobs. This is to prevent perceptions of inequity. Local
employees tend to compare their pay and living standards to
expatriates and feelings of inequity are more likely to arise if an
expatriate at the same level with a local employee is paid the same
level of pay.
Generally, the total pay package has four elements namely base salary, tax
equalization allowances, benefits, and allowances. Expatriates are often offered a
salary premium beyond that of their present salary so as to induce them to accept
the assignment. Tax equalization allowances are necessary because tax rates vary
all over the world. Examples of allowances given include cost of living
allowances, housing allowances, hardship allowances, mobility premiums,
education allowances, relocation allowances and Foreign Service premiums.
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Employee health and safety at the global level.
The increased threat of terrorism is affecting the human resource activities both
domestically and abroad. For example the USA and British governments have
passed many laws that make it difficult to import and export workers since 9/11
terrorists attacks.
Employers have had to institute more comprehensive safety plans including
evacuation plans to get employees to safety if that becomes necessary. Other
approaches include insuring the expatriates.
It is important to keep travellers out of crimes way. Suggestions for include:
Provide expatriates with general training about travelling, living abroad
and information on the place they are going to. In the process of travelling,
expatriates must resist gifts from strangers no matter how friendly the
strangers look like.
When the expatriates arrive in the host country, they should not use public
means other than taxis. This is particularly the case where they would be
“unique” in the vehicle or train they are travelling in.
Tell them not to draw attention of their identity or nationality. Wearing flag
emblems, T-shirts or shirts with their country names are some possible
ways of drawing attention to identity.
Have travellers arrive at airports as close to departure time as possible and
waiting in areas away from the main flow of traffic where they are not easily
observed.
Equip the expatriates’ vehicles and homes with adequate security system
Tell employees to vary their departure and arrival times and take different
routes to and from work.
Where the expatriates are housed in a hostel, discourage them from
inviting strangers into the hostel. They should also not be involved in late
night deals.
Advise them not to take antagonistic positions against their host country
governments.
Expatriates should also be advised on those areas which are considered
unsafe to visit.
Keep employees constantly informed of crimes, threats and other
problems in almost every part of the world.
Advice employees to remain confident at all time. Body language can
attract perpetrates and those who look like victims become victimized.
Another health issue affecting workers is the spread of HIV/AIDS. This disease
is ravaging Africa and spreading rapidly across other areas of the world such as
Asia and Eastern Europe. It is depriving communities and nations of their people,
thereby draining the human and institutional capacities that fuel sustainable
development. HIV/AIDS has serious human resource implications. Organizations
may be subjected to lower productivity stemming from absenteeism, skill
shortages, and lower morale. According to the International Labour Office (ILO),
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there are four focus areas in the fight against HIV/AIDS. These are prevention of
the HIV/AIDS, management and mitigation of the impact of HIV/AIDS on the world
of work, care and support of workers infected and affected by HIV/AIDS, and
elimination of stigma and discrimination on the real or perceived HIV status.
Ch. 22 ORGANIZATIONAL CHANGE AND
DEVELOPMENT Chapter objectives
After reading this chapter, it is expected that the reader will be able to:
Define organizational change and development (OD).
Understand the basic theories and concepts of OD
Describe the planned change model
Explain the roles of the change agent, manager, and people within the
system in developing an intervention strategy
Explain the different types of intervention strategies
Management of change Change is making things different. It is basically a departure from the status quo.
Change, whether it originates from within an organization or from the external
environment, is a constant feature of organizational life and understanding
change is extremely important to successful management. Managers need to be
able to adapt to change themselves, create organizations that are responsive to
change and assist in the introduction of specific change programs.
Forces for change and innovation
The pressure for change can arise from a number of sources within the
organization. These include declining performance, growth of the firm, and
changes in the top management.
External forces for change include the need to comply with new political or legal
forces, economic changes, or even changes in technology.
In managing change it is necessary to understand the role played by the change
manager and the change agents. These roles are briefly listed below.
The role of change manager
In the change process the change manager:
- Oversees the design of the intervention strategy
- Has the overall responsibility for assessing the need for change
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- Is responsible for determining the appropriate intervention activities
- The change manager is also responsible for implementing the strategy and
evaluating the strategy implementation process.
- This manager must understand the nature of planned change as opposed to
‘forced’ change
- He or she should be able to balance the short-term needs with the potential
for the more permanent long-term benefits of planned change
- This manager should pay the necessary attention to the change initiative
and see it through to its conclusion
Change Agents:
The role of a change agent can be filled by an outside consultant, an OD specialist
who is an employee of the organization, a new manager or an enlightened
manager who is able to look beyond traditional approaches. This person assists
the change manager in designing and implementing change strategies,
facilitating all the activities surrounding the design and implementation of the
strategy, advises the change manager on implementation issues and the efficacy
of different intervention strategies. Such a person must have knowledge of OD
theories, concepts, practices and applied research.
a) Internal Change agents:
These are people who work in the organization. Consequently, they posses better
knowledge regarding the organization’s mission, structural components,
technology, internal politics, and social factors. Thus, they can easily establish a
trusting relationship with the change manager and members of the organization
that will undergo the change.
Internal change agents are more quickly available and are less costly to the
organization. It is easier for the organization to control them grant them the
necessary authority for performing their duties.
Nevertheless, internal change agents may be too close to the problem and they
may have biased views thus lacking objectivity. In situations where they are
viewed as part of the problem, this may create additional resistance. The internal
change agent may not possess the specialized knowledge needed for a particular
intervention strategy. Moreover, they may be reassigned to other work in the
organization even when they are implementing change in a certain department.
b) External change agents.
These may be consultants who are hired to fulfil a specific function or role for a
specified period. they work on a contract basis. As such, they may have more
objective views of the organization besides having more experience in dealing
with diverse problems. It is expected that they have more technical knowledge,
competence and the skills needed to implement the change.
Role of the change agent:
Burke (1987) describes eight roles that a change agent may play. The change
agent plays the roles of an advocate, technical specialist, trainer or educator,
collaborator in problem solving, alternative identifier, fact finder, process
specialist, and reflector:
219
MODELS OF PLANNED CHANGE
The change process theory seeks to explain the dynamics through which
organizational improvement and changes take place. The main theories include
the work of Kurt Lewin (1958) and Edgar Schein (1987).
According to Kurt Lewin (1958), a model for change would include the elements
of unfreezing, changing, and refreezing. The unfreezing part seeks to make the
employees aware that the status quo is not good and that a change is necessary.
The change is then implemented. Afterwards it is reinforced as the accepted
behaviour in the organization.
Generally, the process of implementing change in any organization can have six
steps namely:
- Perceiving an opportunity
- Diagnosing the situation and generating ideas
- Presenting a proposal and adopting the change
- Planning to overcome resistance
- Implementing the change
- Monitoring the results.
RESISTANCE TO CHANGE
Employees often resist change even when the change is for the better. This is an
aspect of human behaviour.
In organizations, there are two major reasons for resisting change. These are
general reasons and change specific reasons.
The general reasons for resistance include inertia where people do not want to
disturb the status quo, poor timing of the change, the change being too sudden or
unexpected, and at times peer pressure.
The change specific reasons for resistance are as follows:
- Self interest- this is resistance based on the fear of losing something (
power, resources, friendships, freedom to make decisions, quality of work,
prestige or other benefits) which the person values
- Misunderstandings and lack of trust in those individuals initiating change.
- Different assessments of the effects of the change
- Low tolerance for change
METHODS OF OVERCOMING RESISTANCE TO CHANGE
There are many methods of overcoming resistance to change. Some of them
include education and communication with the organizational members before
the change occurs, participation and involvement of all the people that are to
participate in the change process, showing support to those who are likely to be
negatively affected by the change, use of rewards for those who comply,
negotiating and agreeing with the stakeholders, manipulation and cooptation, as
well as explicit and implicit coercion. Scholars of ethics may question
manipulation, cooptation and coercion as methods of overcoming resistance.
ORGANIZATION DEVELOPMENT (OD).
220
Organization development is a process used to enhance both the effectiveness of
an organization and the well-being of its members through planned interventions.
It is also a top management supported long range effort to improve an
organization’s problem solving and renewal processes particularly through a
more effective and collaborative diagnosis and management of organizational
culture with a special emphasis on the formal work team; it borrows the
assistance of a consultant or facilitator who uses behavioural sciences to
implement his or her efforts.
Thus it can be summarized that OD is:
Planned- it is a proactive and not a reactive process
It focuses on the entire organization or a large subsystem of the
organization such as a division.
It is managed from the top level of the organization.
It is aimed at enhancing organizational health and effectiveness by
ensuring the organization achieves its goals and objectives. The well-being
of organizational members is a primary concern of OD.
It is based on planned change or interventions made with the help of a
change agent or third party who is well versed in the behavioural sciences
such as psychology, sociology, anthropology and management
Organizations must be ready to cope with changing environments. One way to
increase their long term prospects is by using OD.
OD INTERVENTION STRATEGIES
There are four types of intervention strategies namely:
Human process based interventions
Techno-structural interventions.
Socio-technical interventions.
Organizational transformation strategies
These types of interventions are briefly explained below.
Human process-based interventions.
They are directed at improving interpersonal, intra-group, and inter-group
relations. The main interventions here are survey feedback and team building. a) Survey feedback:
Nicholas (1982) defines survey feedback as the systematic feedback of survey
data to groups with the intent of stimulating discussion of problem areas,
generating potential solutions, and stimulating motivation for change.
b) Team building:
It is aimed at helping workgroups to become effective at task accomplishment.
Techno-structural type of strategy intervention:
These strategies are intended to improve work content, technology, methods and
relationships among workers (Friedlander and Brown, 1974). They include: a) Job enlargement:
This is an attempt to increase satisfaction and performance by consolidating work
functions from a horizontal level of the work unit so as to provide greater variety
and a sense of the whole task.
221
b) Job enrichment:
This approach Involves varying some aspect of the job in order to increase the
potential to motivate workers. There are five aspects that constitute an enriched
job. These are skill variety, task identity, task significance, autonomy, and
feedback.
c) Alternative work schedules (AWS):
These allow employees to modify their work requirements to satisfy their
personal needs. The two most common AWS interventions are the compressed
workweek and the flexitime.
Sociotechnical Systems (STS) type of intervention:
These include the following. a) Quality circles (QC):
This approach seeks to get employees involved in making meaningful work
decisions like solving job-related problems. The QC meets on a regular basis to
discuss issues like improvement of the work procedures and product quality,
working conditions and facilities. Priority is given to the problems and nearly all
employees are given time off to attend the meetings.
c) Total quality management (TQM):
This approach seeks to sustain the organizational competitiveness by instilling
quality in all its operations.
d) Self-managed teams (SMTS):
This is a team whose members have discretion over such things as work
assignments, work methods, work schedules, training, and dealing with
external customers and suppliers.
Organizational transformation (OT) strategies
They focus on articulating a new vision for the organization with a purpose of
redefining the desired organizational culture, mission and strategy. The main
approaches here are as follows.
a) Cultural changes/interventions
Cultural change is a complex process of replacing an existing paradigm, way of
thinking, with another. An organization that wants to become multicultural must
be able to make some fundamental changes to existing organizational paradigms
(value cultural differences). The organizational take on the new set of values will
affect how individual workers relate to others in and outside the work setting.
b) Strategic changes
Lawler et al (1989) define strategic change as any fundamental change in the
organizational purpose or mission requiring system-wide changes.
c) Becoming a learning organization
A learning organization is one in which everyone is engaged in identifying and
solving problems, enabling the organization to continuously experiment,
improve, and increase its capability.
222
d) High performance work systems (HPWS)
These are multifaceted approaches that involve different combinations of
intervention strategies such as self-managed teams, quality circles, flatter
organizational structures, new flexible technologies, innovative compensation
schemes, increased training and continuous improvement programs.
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