FACULTY OF MANAGEMENT STUDIES

UNIVERSITY OF DELHI

M.B.A. (Full Time): July­October 2008

Paper: F­106
HUMAN RESOURCE MANAGEMENT
Supplementary Reading Materials

Facilitator: Dr. A. Venkat Raman

Course material prepared by Dr.A.Venkat Raman, FMS, University of Delhi, for class purpose only. The supplementary 1
reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.
 HUMAN RESOURCES MANAGEMENT IN A CHANGING ENVIRONMENT

I. Introduction

™ The world of work continues to change, but at a more rapid pace.

™ Changes in the world marketplace, corporate strategies, work force composition,

and management strategies affect HRM goals and practices.

II. The Global Village and its HRM Implications

Since late 80’s, Indian companies finally realized the importance of worldwide
competition. The rise of multinational and transnational corporations places new
requirements on HR managers.

A. What is the global village?

™ This term refers to the fact that businesses today operate around the world.
™ Ensuring that employees can operate in the appropriate cultural milieu and that
communications are understood by a multilingual ‐ diverse work force.
™ Workers must also be able to operate in cultures that differ on variables such as
status differentiation, societal uncertainty, assertiveness, and individualism.
™ HRM also must help multi cultural groups work together.

B. Globalisation and HRM

Cultural environments that are diverse require more flexible management practices in
terms of Hiring, Training, Rewarding and Motivating employees and managers.

™ Indian work force is strikingly heterogeneous.

™ Employees have different aspirations while taking up job / career in an
organization depending on their social and economic background; and they learn
informally when they work with individuals from different cultures.
™ Technology, Changing demographics, and Globalization have resulted in diverse
work force in which the proportion of women is significantly increasing.
™ Need to attract and maintain a diversified work force that also reflects the
diversity among customers.
™ Managing employees in different age groups, social (sub‐cultural groups) and
helping them to work together is also an HRM challenge
™ Changing Skills Requirements: Increasing proportion of workers are now
employed in the service sector, but the quality, capability and the technical skill is
far from satisfactory.
™ Skill deficiencies cost companies billions of dollars.

Course material prepared by Dr.A.Venkat Raman, FMS, University of Delhi, for class purpose only. The supplementary 2
reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.
 C. Corporate Downsizing (Restructuring, Retrenchment, and Down Sizing) and HRM

ƒ The rationale behind downsizing: Organizations have sought greater

efficiency by reducing the numbers of workers and by increasing managers’
spans of control.
ƒ Downsizing and the HRM Implications: HRM’s role includes ensuring
adequate communications, job redesign, training, and support for both
those leaving and surviving. In many cases the overall performance has not
been drastically improved, and some companies have hired employees
back.

D. Continuous Improvement Programs

ƒ This approach to management involves making constant efforts to better

products and service to customers, use of statistical controls and
management’s role in achieving productivity.
ƒ Effective improvement processes must be supported by top management
and involve customers and employees throughout the organization. Unions
have recognized the value of improvement efforts.
ƒ HRM must prepare individuals for change and provide training.

E. Reengineering Work Process for Improved Productivity.

ƒ Reengineering occurs when more than 70 percent of the work processes

are evaluated and altered. While TQM involves ongoing incremental
changes, reengineering involves radical change of entire work processes.
ƒ Typically three features are included: customer focus, production “friendly”
organizational structure, and thinking about organizational work from
scratch.
ƒ It’s not a quick fix, and should not be used to simply downsize.
Management must be willing to change leadership styles, involve workers
and build teams.
ƒ Reengineering versus Continuous Improvements: Reengineering may be
needed to replace outdated products or systems; Continuous improvement
can be used to monitor and improve the updated processes.
ƒ HRM and Reengineering: HRM’s role includes helping employees to deal
with emotional aspects of conflict and change, providing skills training, and
adapting HR systems, such as compensation, benefits, and performance
standards.

F. The Contingent Work Force

Course material prepared by Dr.A.Venkat Raman, FMS, University of Delhi, for class purpose only. The supplementary 3
reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.
 ƒ Unpredictability of the economic environment has led to organizations’
hiring two types of workers: Core –permanent­ Staff, and Contingent –
contract­ Staff. Contingent workers include part‐time, temporary and
contract workers.
ƒ Are Contingent Workers ‘Throw‐Away’ Workers?: Although use of
contingent workers is growing, it is difficult to state their legal status is
controversial.

HRM’s role includes planning for “virtual” employees, recruiting them, and
ƒ
helping them to adapt to the organization, as well as dealing with potential
conflicts between core and contingent workers.
G. Decentralized Work Sites

ƒ Some companies are asking their employees to work out of their homes,
and to keep in touch via their computers, modems and fax machines.
ƒ Work is Where Your Computer Is: Technology makes telecommuting
possible from anywhere on the globe. Such arrangements meet the needs
of a diversified work force, reduce traffic congestion, reduce costs, and help
organizations obtain qualified workers. Currently about 15 percent of the
work force works at home, in the US.
ƒ HRM and Decentralized Work Sites: HRM can help managers supervise
home workers, and must ensure that compensation and legal protections
are appropriate in non‐traditional work settings.

H. Employee Involvement

ƒ In today’s “lean and mean” work environment, employees at all levels are
expected to be more involved in decision‐making relevant to their work.
This may include delegation of authority to lower level employees,
participative management using group decision making, and involvement
of employees on work teams.
ƒ HRM must provide training to help employees in these new roles, so that
involvement programs can achieve greater productivity, as well as
increased employee loyalty and commitment.

I. TQM and HRM

ƒ TQM is an approach based on continuous process improvement; focus on the

customer, and involvement of employees. Some organizations emphasize
statistical quality control to reduce the number of defects in a product or
number of problems with a service operation. Others have emphasized
frequent customer contact and satisfaction. Many TQM programs do not start
in the HR office, but HR definitely has a role to play in supporting an
organization’s quality efforts. In order to implement a TQM approach,
managers and employees must work together to set standards, to evaluate
their products and services, and to bring about improvement. Selecting the

Course material prepared by Dr.A.Venkat Raman, FMS, University of Delhi, for class purpose only. The supplementary 4
reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.
 right employees for a TQM environment, training them, and monitoring the
organization’s progress are all areas where HR expertise can help.

J. De­layering, Span of Control, HRM and Organizational Efficiency

ƒ In theory, de‐layering management, or cutting out middle layers of

management, makes an organization more efficient because the costs of paying
those people are eliminated. For example, suppose an organization has 3
workers reporting to a supervisor, three supervisors reporting to each director,
3 vice presidents reporting to the CEO. The span of control is 3 in that
organization. Suppose the span of control were increased to 6 at only the
lowest level of the organization. Half of the supervisors could be eliminated,
and therefore, half of the directors and one vice–president. It is usually difficult
to justify a layer of management with only one person in it, so the remaining
vice–president position might also be eliminated. If the span of control were
increased up the organization, even more savings would be realized.

ƒ In reality, however, increasing the span of control does not necessarily increase
efficiency. Work quality may suffer; morale and commitment are often
lessened; communication may become bottle necked. If fewer managers are
available to solve problems and represent their work units to customers and
others in the organization, employees need to learn to take on these
responsibilities and learn these skills, possibly as part of their new roles as self‐
managing team members. Downsizing to save costs in the short term is
effective. However, over the long term, if downsizing were done only to save
costs, there is a negative organizational impact. The role of HRM is to make
sure that downsizing is done strategically, rather than as a cost cutting
expedient.

K. Employee Empowerment

ƒ Autonomy and control over work process has been shown to be important
for some employees decades ago (Hackman and Oldham's work on the
Motivating Potential Score.) Recent social trends and the expectations of
younger workers have made empowerment a reality for more employees.
The new expectation is for more responsibility and more autonomy. As
such, if empowerment is truly satisfying employees' needs, it will not be a
fad. Some firms may implement empowerment in a faddish way. If
managers don’t take the time to provide the training and the support
needed to develop competent empowered workers, empowerment will lead
to neither more satisfied nor more productive workers

ƒ Therefore, Empowerment is
Skilled capable workers +
Trusting environment +
Supervisors willing to let go +

Course material prepared by Dr.A.Venkat Raman, FMS, University of Delhi, for class purpose only. The supplementary 5
reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.
 Time to make it happen +
Training +
Support from the top.

L. Corporate Day Care programs and Women Employees

ƒ Females are becoming a larger portion of the labour pool. The benefits of day care
often signal a more human approach to lifestyle issues that are important not only
to females with children, but to all workers who value lifestyle considerations as
well as workplace. Figures show that absenteeism, turnover, and stress‐related
complaints are lower for organizations that provide day care and that morale and
commitment are improved in those organizations.

Most of the above‐mentioned changes represent changes in our work force, economy and
technology; some represent organization responses to these changes, such as downsizing
and empowerment. It is impossible to effectively implement any of the organizational
effectiveness programs without considering some of these trends. For example, a TQM
study may indicate that entire work processes must be reengineered, leading to changing
skill requirements and downsizing. Work force diversity and skill availability must be
considered when hiring needed individuals to fit the new organizational structures, which
are put in place to achieve competitiveness.

Notes:

Course material prepared by Dr.A.Venkat Raman, FMS, University of Delhi, for class purpose only. The supplementary 6
reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.
Course material prepared by Dr.A.Venkat Raman, FMS, University of Delhi, for class purpose only. The supplementary 7
reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.
 HUMAN RESOURCE PLANNING AND CORPORATE STRATEGIES

I. Introduction

™ Manpower Planning (MPP) is the Quantitative estimation of the number of

people required (Demand Forecasting) and the number of people available
(Supply Analysis) in an organization, in a given time frame.

™ Human Resource Planning (HRP) is a process by which an organization ensures

that it has the optimum number of people, capable of effectively and efficiently
completing those tasks that will help the organization achieve its overall strategic
objectives.

™ HRP not only includes MPP, i.e. the quantitative estimation of number of
employees needed and available, but also takes stock of the existing deployment of
the workforce, their skills, capabilities, competences, and identify any manpower
imbalances. If the existing deployment exceeds the optimum number, the
organization may resort to the option of down sizing, retrenchment, lay offs or
business expansion, diversification, enhanced production capacity, etc. If the
human resource imbalance occurs due to inadequate supply (wastage due to
turnover, etc), then retention strategies need to be explored.

™ HRP is linked to the organization’s overall strategy and planning to compete

domestically and globally. Overall plans and objectives must be translated into the
number and types of workers needed.

™ Senior HRM staff needs to lead top management in planning for HR issues.

II. Pre­requisite for HRP:

™ Outline the Business Strategies and Strategic Planning Framework of the

Organization, in terms of:

ƒ A mission statement, which defines what business the organization is in,

including why it exists, and who its customers are.
ƒ Strategic goals as set by senior management to establish targets for the
organization to achieve.
ƒ Objectives as defined for the next 5‐20 years, and a SWOT Analysis that
determines what is needed to meet objectives.
ƒ The direction (strategy) and structure of the company are determined.
ƒ Job Analysis is used to determine what knowledge, skills and abilities that are
required by the organization’s human resources.

™ Link Organizational Strategy to HRP. Ensure that people are available to meet
the requirements set during strategic planning.

Course material prepared by Dr.A.Venkat Raman, FMS, University of Delhi, for class purpose only. The supplementary 8
reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.
 ™ Assess current human resources, i.e. human resources inventory report, which
summarizes information on current workers and their skills.

™ Design and implement Human Resource Information Systems (HRIS), i.e. a

computerized database that contain important information about employees

™ Develop Replacement Charts, which portray middle‐to‐upper level management

positions, which may become vacant in the near future and list information about
individuals who might qualify to fill the positions. They are used for succession
planning.

III. The demand for Labour

A human resource inventory can be developed to project year‐by‐year

ƒ
estimates of future HR needs for each job level and type. Forecasts must be
made for needs for specific knowledge, skills and abilities.
IV. Estimating the Future Supply of Labour:

ƒ A unit’s supply of human resources comes from new hires, contingent

workers, transfers‐in or individuals returning from leaves. Transfers are
more difficult to predict since they depend on actions in other units.
ƒ Decreases in internal supply come about through retirements, dismissals,
transfers‐out, lay‐offs, voluntary quits, sabbaticals, prolonged illnesses, or
deaths. Retirements are the easiest to forecast. Some of these factors are
more controllable by management than others.

V. Matching the Demand and Supply of Labour

ƒ Current and future shortages and overstaffing should be evaluated.

ƒ Recruitment, Training, Productivity Improvement may be used to match
supply with demand.

VI. Determining Required Skills, Knowledge and Abilities

™ Job Analysis: a systematic exploration of the activities within a job; it

defines and documents the duties, responsibilities and accountabilities of a
job.

™ Job Analysis Methods are,

1. Observation method
2. Individual interview method
3. Group interview method
4. Structured questionnaire method
5. Technical conference method
6. Diary method

Course material prepared by Dr.A.Venkat Raman, FMS, University of Delhi, for class purpose only. The supplementary 9
reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.
 ™ Job Analysis Steps are
1. Understand the purpose of conducting the job analysis.
2. Understand the role of jobs and values in the organization.
3. Benchmark positions‐ Choose representative jobs.
4. Seek clarification, wherever necessary.
5. Develop the first draft of the job description.
6. Review draft with the job supervisor.

™ Position Analysis Questionnaire (PAQ)(developed at Purdue University),

in which Jobs are rated on 194 elements, grouped in six divisions and 28
sections. The elements represent requirements that are applicable to all
types of jobs. This type of quantitative questionnaire allows many different
jobs to be compared with each other.

™ Purpose of Job Analysis

Almost al HRM activities are tied to job analysis.

Job analysis is the starting point for sound HRM.

A. Job Descriptions
i. Written statement of what jobholder does, how done, under what
conditions and why.
ii. Common format: title; duties; distinguishing characteristics;
environmental conditions; authority and responsibilities.
iii. Used to give information to applicants, to guide new employees, and to
evaluate employees.
B. Job Specifications
i. States the minimum acceptable qualifications, experience and
personality traits.
ii. Used when selecting qualified employees.
C. Job Evaluation
i. Specifies the relative value of each job in the organization.
ii. Used to design equitable compensation program.

VII. Current Issues in HRP

A. Downsizing
i. HRP is often ignored in declining industries; Employee cuts are
considered to be “quick fix” solutions; Productivity often fell.
ii. Paradoxically many companies now hire and lay off employees at the
same time.
iii. Rightsizing, i.e. search for the optimal number is most challenging.

B. “Little Help” while Downsizing

Course material prepared by Dr.A.Venkat Raman, FMS, University of Delhi, for class purpose only. The supplementary 10
reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.
 i. Outplacement provides assistance to “existing employees” who must find
a job outside the company. It may include job‐help services, VRS, financial
assistance, psychological counselling, support groups, severance pay,
extended insurance benefits and detailed communications.

ii. The crucial period for out‐placed employees is the first three to six
months. Costs of outplacement range into the thousands for each individual.

iii. Layoff­survivor sickness is a set of attitudes, perceptions, and

behaviours of employees who remain following involuntary employee
reductions.

iv. Employers can provide support in the form of counselling, group

discussions to vent feelings, and implementation of employee participation
programs.

Review:

™ Defining HRP

Strategic human resource planning is the process by which an organization ensures that it
has the right number and kinds of people, capable of effectively and efficiently completing
those tasks that are in direct support of the company's mission.

™ What is involved in the HRP process?

HRP is based on the strategic planning process for the organization, which determines the
organizational mission, goals and objectives. HRP includes assessing current human
resources, estimating the supplies and demand for labour, and matching demand with
current supplies of labour. Outcomes of this process include recruitment, rightsizing,
reassignment of employees, or even adjustment in the organization’s objectives, based on
availability of human resources.

™ Defining Job Analysis

Job analysis is a systematic exploration of the activities surrounding and within a job. It
defines the job’s duties, responsibilities, and accountability. It is the process used to
document job requirements, and provides the information on which to base HR systems
for selection, performance appraisal, training, compensation and discipline.

™ Advantages and Disadvantages of Observation Method, Structured

Questionnaire Method, and Diary Method of Job Analysis Techniques

Observation method can collect accurate data, quickly, and can assimilate that data easily
with other data. Behaviours can be accurately described. The observer has the advantage

Course material prepared by Dr.A.Venkat Raman, FMS, University of Delhi, for class purpose only. The supplementary 11
reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.
of a dispassionate, impartial opinion about the job. There are disadvantages when using
the observation method. Workers may act differently if they are observed. The observer
may be watching the wrong thing. Typical events may not occur in the time period
watched. The observer may not understand what he or she sees. If multiple observers
are used, they must be trained to consistently report the same behaviours.

The structured questionnaire method has several advantages. Consistent responses are
obtained because the same questions are asked of all workers. It is easy to train analysts
in the technique. The format is easy to analyse. Disadvantages of the technique are that
the wrong questions may be asked or the wrong people may be interviewed.

The diary method is useful in gathering subtle, non‐routine or complex data about a job.
It provides information that may not be obvious to the observer. It allows the incumbent,
the expert, to record important job characteristics. Analysts do not have to do the data
collection or be trained to do it. However, there are several disadvantages with the diary
method. Incumbents may record the wrong data. Different incumbents may have vastly
different ideas about the nature of their work. Their reports may be inaccurate, or duties
considered more or less important than they actually are. Keeping a diary is time
consuming. Workers often forget and may need to be prompted to record their events.
Such prompting may alter the accuracy of the recorded data. Data is difficult to analyse.
It usually requires content analysis, a messy technique.

™ Meaning of Job Description, Job Specification, and Job Evaluation

Job descriptions are written statements of what the jobholder does (duties and
responsibilities); job specifications identify the personal characteristics required to
perform successfully on the job; and job evaluation is the process of using job analysis
information in establishing a compensation system.

™ HR Implications when an organization is in a Retrenchment mode.

Organizations often do not do a good job of strategic HRP when they are in retrenchment.
However, a firm that abandons planning during retrenchment is probably doomed. The
labour pool source is focused on the internal. Long range planning is extremely important
during downsizing. Employees who may be useful should be retained if at all possible.
The focus is often more on outplacement, in which case the firm should seek to not
alienate former employees or the community at large.

™ “External supply of employees for meeting future employee needs is better

because these employees bring new blood' into an organization, resulting in
more innovative and creative ideas”

Outside employees are indeed needed to bring new ideas, new blood into an organization,
particularly if an organization is a stable bureaucracy where innovation is not valued.

Course material prepared by Dr.A.Venkat Raman, FMS, University of Delhi, for class purpose only. The supplementary 12
reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.
The outsider is good at bringing a fresh perspective to old problems. For firms that value
innovation and insight, bringing in outsiders is a good way to accomplish that goal.

But, for organizations that do not want to rock the boat, new employees hired from the
outside should be avoided. If the organization's culture dictate that the way things have
always been done is the best way to do them, new blood should not be (and usually is not)
brought in above the entry level. During orientation, employees are taught to think the
right way. Most theorists view the world as one of increasing turbulence and change,
with the traditional ways of viewing the world and doing business as no longer adequate.
The problem, then, is for stable bureaucracies to be able to change enough to accept new
ideas.
RECRUITMENT AND SELECTION

I. Introduction

Once an organization identifies its human resource needs through HRP, it can
begin the process of recruiting potentially qualified applicants.

Recruiting brings together those with jobs to fill and those seeking jobs. Selection,
which determines which candidates to hire, is the next step in the staffing process.

II. Recruiting Goals

To establish the contact with the potential sources and provide information that
will attract a good number of qualified candidates and discourage unqualified
ones from applying.

A. Factors that affect recruiting efforts

1.Organizational size
2.Employment conditions
3.Working conditions, salary and benefits offered
4.Organizational growth or decline

B. Factors that limit managers’ freedom to recruit and select a candidate of their
choice include
1. Image of the organization
2. Attractiveness of the job
3. Internal organizational policies, such as encouraging promotion from
within, than external hire.
4. Government influence, such as Reservation laws.
5. Recruiting costs

C. Recruiting from an International Perspective.

For some positions, the whole world is a relevant labour market.

Course material prepared by Dr.A.Venkat Raman, FMS, University of Delhi, for class purpose only. The supplementary 13
reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.
 1. Home­country nationals are recruited when an organization is
searching for someone with extensive company experience to launch a very
technical product in a country where it has never sold before.

2. Host­country nationals are targeted as recruits when companies want

each foreign subsidiary to have its own distinct national identity. In some
countries, laws control how many expatriates a corporation can send. Host
country nationals minimize potential problems with language, family
adjustment and hostile political environments.

3.Recruiting regardless of nationality may develop an executive cadre with

a truly global perspective.
III. Recruiting Sources: These should match the position to be filled.

The internal search:

A. Organizations that promote from within identify current employees for job
openings by having individuals bid for jobs, by using their HR Information system
or by utilizing employee references.
Advantages of promoting from within include good public relations,
morale building, encouragement of ambitious employees and
availability of information on existing employee performance, cost‐
savings, internal candidates’ knowledge of the organization, and the
opportunity to develop mid‐ and top‐level managers.
Disadvantages include possible inferiority of internal candidates,
infighting and morale problems, and potential inbreeding.

B. Employee referrals/recommendations: Current employees can be asked to

recommend recruits.
Advantages include the employee’s motivation to make a good
recommendation and the availability of accurate job information for
the recruit. Employee referrals tend to be more acceptable to
applicants, to be more likely to accept an offer, and to have a higher
survival rate.
Disadvantages include the possibility of friendship being confused with job
performance, the potential for nepotism, and the potential for
adverse impact.

The External Searches

A. Advertisements: Must decide type & location of ad, depending on job;

decide whether to focus on job (job description) or on applicant (job
specification). Blind box ads don’t identify the organization.

B. Employment agencies

Course material prepared by Dr.A.Venkat Raman, FMS, University of Delhi, for class purpose only. The supplementary 14
reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.
 i. State Public Employment Services (Employment Exchanges or
Ex­Servicemen Registry) traditionally have focused on helping
unemployed individuals with lower skill levels to find jobs.

ii. Private Employment Services (Placement Consultants) may

provide more comprehensive services. Fee may be paid by the
employer, employee or both.

iii. Management consulting, Executive Search or Head­Hunter firms

specialize in executive placement and hard‐to‐fill positions. They
charge employers up to 30% of the first year salary, have nationwide
contacts, and do thorough investigations of candidates

D. Colleges, Universities and Institutions may provide entry‐level or experienced

workers through their campus placement services. Campus placements,
accomplished by having recruiters visit campus, may cost the recruiter, for each
selected candidate or in some other form.

E. Professional Organizations: Publish rosters of vacancies, placement services at

meetings, and may control the supply of prospective applicants.

F. Cyberspace Recruiting: Nearly half of all major U.S. companies, and many Indian
companies use the Internet to recruit for jobs at all levels.

G. Unsolicited applicants (Walk­Ins): May provide a stockpile of potential employees

if there are no current openings.

IV. Recruitment alternatives

Temporary help services help organizations meet short‐term fluctuations in HRM

needs. Older workers can also provide high quality temporary help.
1.
Employee leasing. Trained workers are employed by a contract company, which
provides them to employers when needed for a flat fee.

Independent contractors do specific work either on or off the company’s premises.

Costs of regular employees (i.e. taxes & benefits costs) are not incurred.

Recruitment ends and Selection begins once we have located the targeted number of
diverse, qualified applicants.

V. Selection Process.

The purpose of each step in the selection process is to predict who will be a successful
employee. Successful employees meet the requirements and are a good “fit” with the

Course material prepared by Dr.A.Venkat Raman, FMS, University of Delhi, for class purpose only. The supplementary 15
reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.
company. The objective of the selection process is to find a “Person ­ Job – Organization
(PJO) fit”.

The Selection Process follows

A. Initial screening:

i.. Screening of inquiries: Make sure applicants meet minimal requirements in job
specification.
ii. Screening interviews: Clarify the job description and salary range for applicants.
B. Completion of the Application form.

i. Obtain a job‐performance‐related synopsis of applicants’

experiences and skills.
ii. Test whether applicants can follow directions.
iii. Obtain signatures attesting to truthfulness and giving permission to
check references.

C. Employment tests

i. May include intelligence, aptitude, ability and interest tests.

D. The Comprehensive Interview

i. Used to assess motivation, ability to work under pressure, ability to

fit in and other attributes not easily assessed by application or tests.
ii. Questions and topics should be job‐related.

E. Background investigation

i. Includes contacting former employers, other references, verifying

educational accomplishments and legal status, and criminal records.

F. Conditional Job Offer:

i. Implies that if everything checks out okay (medical, physical,

substance abuse test), the offer will be permanent.

G. Physical/medical Examination

i. Physical exams must be tied to job requirements.

ii. Information may be used to evaluate future insurance claims.
iii. Drug tests may be used to disqualify applicants.

H. Job Offer

i. Hiring manager should make final decision.

Course material prepared by Dr.A.Venkat Raman, FMS, University of Delhi, for class purpose only. The supplementary 16
reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.
 ii. HR dept. plays administrative role
iii. Finalists who are not hired need to be notified.

Applicant must also make a decision to accept or reject a job offer, based on perceived
compatibility of job with personality and goals. Company also must consider how rejected
candidates are treated.

VI. The Comprehensive Approach:

™ In a comprehensive selection approach, all applicants are put through every

step of the process, and the final decision is based on results from all stages. A
discrete method eliminates individuals who receive low evaluations at one
step.

™ The comprehensive approach is more costly and may build false hopes, but
helps managers make the best decisions for jobs where strengths in one area
may compensate for weaknesses in another.

VII. Key Elements for Successful Predictors: The success of the selection method
will depend on,

™ Reliability: The ability of the selection tool to measure an attribute

consistently.

™ Validity: Indicates how well a selection tool predicts job performance. There
are several ways to assess validity:
1. Content validity: The degree to which to content of a test
represents the content of the job.
2. Construct validity: The degree to which a test measures a
particular trait related to successful performance on the job.
3. Criterion­related validity: The degree to which a selection device
accurately predicts a relevant job performance criterion. May be
assessed two ways:
a. Predictive validity is determined by correlating selection
test scores of applicants with their future job performance.
b. Concurrent validity is determined by correlating the test
scores of current employees with measures of their job
performance.
4. Cut scores on a selection device can be determined by validity
studies; applicants scoring below the cut score are predicted to be
unsuccessful on the job and are, therefore, rejected.

™ The Validity Analysis: Correlation coefficients (validity coefficients)

summarize the statistical relationship between an individual’s test score
and his/her job performance.

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reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.
 ™ Cut scores and their impact on hiring: By graphing test scores vs
performance ratings, we can see the effects of various cut scores on the
success of a hiring procedure with a particular validity.

™ Validity generalization. This is a statistical procedure, which determines

the validity of a selection test for screening applicants for a variety of jobs.
Information on validity in some settings is used to estimate validity for
other job settings.

VIII. Selection from an International Perspective

™ Selection for international assignments includes factors such as interest in

working overseas, ability to relate to different cultures, and supportiveness
of the candidates’ family (“family situation factor").

™ Women executives have done well abroad in Asia and Latin America,
despite past reluctance to assign them to these countries.
Finally, despite all the efforts of the organization one must keep in mind that the final
decision to accept or reject the offer is with the Candidate

Review:

™ "Dual Objectives" of Recruitment

The two goals of recruiting are to generate a large pool of applicants from which to
choose while simultaneously providing enough information for individuals to self‐select
out of the process.

™ Factors that influence Recruiting

Factors that constrain Human Resources Management in determining recruiting sources

include image of the organization, attractiveness and nature of the job, salary and other
benefits, internal policies, career avenues and mobility options, government
requirements, the recruiting budget and even the place of posting.

™ Advantages and Disadvantages of recruiting through Internal search,

Employee Referrals and Casual or Unsolicited applicants

Advantages of an internal search are that the person already knows the culture and the
organization. Fit is more one–sided in this case. If the candidate is selected, he or she
probably will accept the job. Internal applicants have already cleared background
investigations, and other external hurdles, so the recruiting process is a simpler one.
Disadvantages of an internal search are that the pool will be restricted to attitudes, skills
and abilities already in the organization.

Course material prepared by Dr.A.Venkat Raman, FMS, University of Delhi, for class purpose only. The supplementary 18
reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.
Employee referrals have several advantages. The candidate probably already has a
realistic sense of the organization from the employee. Therefore, if the candidate is
selected, he or she probably will accept the job. The employee can serve as a reference,
thus somewhat potentially simplifying security and background investigation measures.
Disadvantages are tied to the nature of the employee who recommended the applicant. If
that employee is not a good employee, chances are that he or she has not recruited a good
employee. The applicant pool is restricted to acquaintances of current workers. The
limitation is not as severe as an internal search, but it is similar in kind.

The advantage of casual or unsolicited applicants is that the labour pool is expanded in
unexpected ways. Also, there is no recruiting expense to the employer. Disadvantages
are that more paperwork is involved, and the organization may not hire an extraordinary
potential employee if it is not aware that the person's skills and abilities are needed. If
the firm is systematic in its recruiting efforts, the casual applicant may well be matched. If
the firm is also rigid, casual and unsolicited applicants may be ignored.

™ Objectives of selection

The primary purpose of selection activities is to predict which job applicant will be
successful if hired. During the selection process, candidates are also informed about the
job and organization. These may conflict, because the best‐ qualified applicant may not
find the job desirable.

™ The Seven­Steps of Selection process

Selection is usually a series of hurdles or steps. Each one must be successfully cleared
before the applicant proceeds to the next. The discrete selection process may include the
following seven steps: initial screening interview, completion of the application form,
employment tests, comprehensive interview, background investigation, physical examina‐
tion (after initial offer is made), and final employment decision.

™ Concepts of Reliability and Validity and their Relevance

Reliability is confidence that an indicator will measure the same thing every time.
Validity is confidence that what is stated as measured is actually measured. There are
several types of validity important in the selection and recruiting phases of human
resources. Content validity is the degree to which the content of the test represents the
actual work situation. For example, a typing test has high content validity for a typist.
Construct validity refers to the degree to which a particular trait is related to successful
job performance. For instance, honesty would be important for a bank teller. Criterion‐
related validity is the degree to which a particular selection device accurately predicts the
important elements of work.

Course material prepared by Dr.A.Venkat Raman, FMS, University of Delhi, for class purpose only. The supplementary 19
reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.
Human resources professionals are concerned with validity because, legally, employment
tests must be shown to be relevant to the job for which a person is hired, as are other
selection criteria.

™ "Should an organization follow a promote­from­within policy?"

Promotion from within encourages current employees to do well in their present jobs
with the hope of reward in terms of advancement within the firm. This prospect builds
morale; helps define purpose and meaning at work. Corporate values and culture are
more defined and upheld in promote–from–within organizations. As long as the firm is
developing the skills and abilities it needs, this arrangement is a desirable one.

But, organizations who only promote from within are getting new ideas and new blood
only at the entry level, the lowest levels of the organization. Stagnation and complacency
can result. If innovation, adaptability to external circumstances are desirable, then
promote– from–within is not good.

™ "The use of leased and temporary employees in an organization will only

lead to a decrease in employee morale. These employees come in, do their
job, then leave it up to the 'full­timers' to handle the details."

Temporary and leased employees do not have loyalty to the organization, and do leave to
go elsewhere. Therefore, they may not fix problems as lovingly as an employee who has
to live with the solution. Also, temporary and leased employees do not have the
experience or cultural sensitisation to know the probable approaches to situations that an
insider would have. If they leave a mess, morale for survivors may indeed be low. The
judgment of management that would trust such responsibility to temps could well be
questioned. One alternative is to transfer full–time employees from other jobs within the
firm to meet extraordinary needs when they arise.

However, temporary and leased employees are valuable to the firm for many reasons.
They can be morale builders to other employees by doing jobs that no full‐time person
wants to do, or finds too stressful to do. They can take over seasonal overloads and help
full‐time employees do their jobs. They can be used to aid in technology transitions or
conversions, bringing needed skills with them while full‐time staff learn new skills.
Temporary employment also affords the firm a chance to evaluate new employees before
permanent hiring arrangements are made with them. Thus, new full‐time employees are
better fits, and this too is a morale builder. It is the responsibility of management and
HRM in terms of job design to make sure that temporary employees are not placed in
positions that will encourage someone to walk away from a mess for full–timers to
handle.

Notes:

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reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.
Course material prepared by Dr.A.Venkat Raman, FMS, University of Delhi, for class purpose only. The supplementary 21
reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.
 INDUCTION, ORIENTATION AND SOCILAIZATION

I. Introduction

Socialization, training and development are all used to ensure that employees
understand what is expected and can be productive on their jobs.

Ideally, employees will understand and accept the behaviours desired by the
organization, and will be able to attain their own goals by exhibiting these
behaviours.

II. The Outsider­Insider Passage

A. Socialization

i. A process of adaptation to a new work role.

ii. Adjustments must be made whenever individuals change jobs; the
most profound adjustment occurs when an individual first enters an
organization.

B. The assumptions of Employee Socialization

i. Socialization influences employee performance, by providing

information on how to do the job and ensuring organizational fit.
ii. Socialization increases organizational stability, since it promotes
consistency of philosophy and objectives.
iii. New members suffer from anxiety, which motivates them to learn,
but which requires special attention to put them at ease.
iv. Socialization does not occur in a vacuum. It is influenced by subtle
and less subtle statements and behaviours exhibited by colleagues,
management, employees, clients and others over a period of time.
v. The way in which individuals adjust to new situations is remarkably
similar. All new employees go through a settling‐in period.

C. The Socialization Process

i. Pre­Arrival stage: Individuals arrive with values, attitudes and

expectations, which they have developed, from previous experience
and the selection process.
ii. Encounter Stage: Individuals discover how well their expectations
match realities within the organization.
iii. Metamorphosis stage: Individuals have adapted to the
organization, feel accepted and know what is expected of them.

III. The Purpose of New­Employee Orientation:

Course material prepared by Dr.A.Venkat Raman, FMS, University of Delhi, for class purpose only. The supplementary 22
reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.
 Orientation may be done by the supervisor, the HRM staff or some
combination. It may be formal or informal, depending on the size of the
organization.

A. Learning the Organization’s Culture

i. Culture includes long‐standing, often unwritten rules about what is

appropriate behaviour.
ii. Socialized employees know how things are done, what matters, and
which behaviours and perspectives are acceptable.

B. The CEO’s Role in Orientation

i. Since the mid‐1980s, it has become more common for top‐level

managers to be visible during the new employee orientation process.

ii. CEOs can

a. Provide a vision for the company.
b. Introduce company culture ‐ what matters.
c. Convey that the company cares about employees.
d. Allay some new employee anxieties and help them to feel
good about their job choice.

C. HRM’s Role in Orientation

i. Coordinating Role: HRM instructs new employees when to report;

Provides information about benefits choices.
ii. Participant Role: HRM offers its assistance for future employee
needs (career guidance, etc.).

Review:

™ Benefits of Socialization for the Organization

Good socialization adds continuity and stability to an organization. Communication is

facilitated, as members share visions and values. Goals are easier to set with a shared
sense of purpose for the organization. Goals are easier to attain when workers agree
that the business in which they are engaged is worth doing.

™ Benefits of Socialization for the New Employee

Organizational entry is eased, so that new employees do not make as many mistakes.
When new employees know what is expected of them, they have better organizational
performance and less frustration and uncertainty. Turnover rates are lower for
organizations that conduct a good orientation program for new employees.

Course material prepared by Dr.A.Venkat Raman, FMS, University of Delhi, for class purpose only. The supplementary 23
reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.
 ™ Socialization Program for Employees who are Innovative and Individualistic

Notions of individuality and creativity are important. The idea that the socialization
should be consistent with the desired outcomes is important. The program should not
be a formal.

Some possibilities are,

Show the new employee the desk, give them a computer and a number to call if he or
she has questions.

Schedule an informal discussion session with co‐workers to talk about their current
projects, or current problems, or future plans, or some such.

Schedule meetings with clients or users that focus on problems or solutions or

opportunities.

Exhibit what other employees have accomplished – patents, new ideas, new processes,
whatever is deemed desirable.

Let the new employee spend the day with an innovative employee who has similar
interests.

If schedules or checkpoints are discussed, leave goals open‐ended and flexible.

™ Socialization Program, if Employees are totally loyal and committed to the

organization's goals

Notions of loyalty and commitment are important. The idea that the socialization
should be consistent with the desired outcomes is important. Rewards for desired
behaviours and penalties for undesirable behaviours should be included.

Some possibilities are,

Take the new employee to a recognition dinner for long‐term employees

Explain reward systems to the new employee that stress loyalty and commitment

Gossip about "mavericks" who of course are no longer in the organization, who did
things the wrong way

Introduce happy long‐term employees to the new hire

Course material prepared by Dr.A.Venkat Raman, FMS, University of Delhi, for class purpose only. The supplementary 24
reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.
 Let the new employee go to lunch with long‐term, committed, happy employees.

™ Role of HRM and CEO in Orientation.

Each function in HRM has a specific role in orientation. Explain how the promotion
from within process works and usually coordinates the rest of the orientation process.
Training and Development talks about development programs offered and what that
means to the employee. Compensation and Benefits has forms completed and
discusses salary and benefit offerings, and details of the compensation program.
Employee Relations discusses the company's communications programs, health and
safety issues, and employee recognition programs.

The CEO's role in orientation is to welcome the new employees, reaffirm their choice
of joining the company, and discuss the organization's goals and objectives while
conveying information about the organization's culture.

™ Is Proper Selection a Substitute for Socialization?

The facetious solution to every human resource problem is hiring the right person in
the first place. However, that is not easy to do. If an individual has the same values
and respects the same norms, and is familiar with the roles used in an organization,
then little socialization is necessary. That individual has already learned and accepted
the "Do's" and "Don'ts" of the organization. Little adjustment remains to be made.
This type of situation may be possible when children of company officers are hired, or
when new employees come from sister organizations. However, even the most
compatible individual needs to learn the peculiarities of this organization. There are
bound to be issues at one time or another where the individual and the organization
are not simpatico. Knowing which human resource professional area to go to at that
time is helpful. If a person is compatible when hired, at some time in the future,
organizational growth and personal growth may diverge. Socialization includes
getting to know the company, but also the individuals, the groups, and the nature of
the task.
.
™ Selection, Socialization and Training: The linkage

There can be a reciprocal relationship between selection and training. If both

functions are aware of the needs of the organization, they can work together to get the
right people. Selection has to hire people who are ready to perform. If training can
provide certain skills or sets of skills to new workers, the selection function has more
options open to it and can hire a variety of workers who can be "fine tuned" during
training. If the two functions do not interact well, selection is left on its own. Training
also has no early warning from selection areas, so it has less time to respond to
demands for training.

Course material prepared by Dr.A.Venkat Raman, FMS, University of Delhi, for class purpose only. The supplementary 25
reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.
 Training and Socialization can have a harmonious relationship in an organization. If
employees are socialized into thinking that training is a necessary, vibrant part of the
organization, a piece that helps them grow and change with the company, then the job
of trainers is an easier and more pleasant one. If training has partial responsibility for
an orientation program, socialization is facilitated. Training that encourages
employee growth and that is competency based, helps to create positive culture in an
organization. If employees are socialized into regarding training as a nuisance or
waste of time or punitive, they will attend training functions reluctantly, if at all. They
will not see training as an avenue of personal or professional growth. Such a
relationship makes it very difficult for training to be responsive to organizational
needs. If training functions are not integrated into the rest of the human resource
management areas, it will be irrelevant. Poor training, inadequate training,
superfluous training can help socialize employees in negative ways – to disregard
their supervisors, to have disdain for the organization, to have a sense that the
company neither knows nor cares about their well‐being.

Notes:

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reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.
 PERFORMANCE EVALUATION AND PERFORMANACE MANAGEMENT

I. Introduction

™ The Performance Appraisal process is a formal process by which each

employee’s performance is evaluated. Whereas Performance
Management process is not only that evaluates employees’ past
performance, but also documents the performance pattern, provides
adequate scope for developing employees’ potentials, and focuses on
continuous performance improvement through appropriately tailored
reinforcement mechanisms.

™ The Performance appraisal process should be based on job analysis, and

includes decisions about who should evaluate performance, what format
should be used and how the results should be utilized. The process should
be designed to strengthen the effort‐performance linkage.

II. The Linkage to Motivation:

ƒ Employees are motivated by the linkages they perceive between their efforts and
performance, and between their performance and rewards.

ƒ An appraisal system helps the organization communicate its expectations for

performance, and the connections between performance and rewards to
employees.

ƒ Performance appraisal can increase employee confidence when employees receive

feedback that their efforts are paying off.

III. Performance Management Systems

A. The purposes
i. Feedback ‐ let employees know how well they have done.
ii. Development ‐ work with employees to improve.
iii. Documentation ‐ to meet legal requirements.

B. Difficulties in performance management systems

i. Open discussions on performance may elicit emotions and may

generate conflicts when subordinates and supervisors do not agree.
ii. The formal organizational process may encourage the wrong
behaviours; e.g. managers’ focusing on the negative to make
numbers “balance.”

C. Effectively Evaluating employees

Course material prepared by Dr.A.Venkat Raman, FMS, University of Delhi, for class purpose only. The supplementary 27
reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.
 i. Prepare for, and schedule the appraisal in advance. Include review
of job descriptions, goals and performance data.
ii. Create a supportive environment to put employees at ease.
Appraisals can elicit emotions.
iii. Describe the purpose of the appraisal to employees. For example,
will the appraisal have implications for pay raises, promotions or
other decisions?
iv. Involve the employee in the appraisal discussion, including a self‐
evaluation: Ask employees to prepare and be receptive to their
perspective.
v. Focus discussion on work behaviours, not on the employees.
Describe specific behaviours you have observed, rather than
evaluate employee characteristics.
vi. Support your evaluation with specific examples. Job‐related
behavioural observations and discussions focusing on the effects of
an employee’s behaviour are most useful.
vii. Give both positive and negative feedback. Good work should be
reinforced. Suggestions for improvement should be clear.
viii. Ensure employees understand what was discussed in the
appraisal. Ask employees to summarize what has been discussed.
ix. Generate a development plan. Write down what should be done,
by when, and what you will do to assist.

IV. Performance Appraisals and Objectivity

i. HRM practices must be bias free, objective and job‐related.

ii. Valid performance appraisals are conducted at established intervals and are
done by trained appraisers.

V. The Appraisal Process

A. Establishment of performance standards

i. Derived from company’s strategy.
ii. Based on job description.

B. Communication of expectations to employee.

C. Measurement of performance using information from

i. Personal observation
ii. Statistical reports
iii. Oral reports
iv. Written reports

D. Comparison of actual performance with standards.

E. Discussion of appraisal with employee.

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reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.
 F. Initiation of corrective action where necessary.
i. Immediate action deals with symptoms.
ii. Basic corrective action deals with causes.

VI. Appraisal Methods

A. Absolute standards: In this method, employees are not compared to each

other
i. Essay appraisal: Appraiser writes narrative describing
employee performance & suggestions.
ii. Critical incident appraisal: Based on specific behavioural
anecdotes illustrating effective or ineffective job performance.
iii. Checklist appraisal: Appraiser checks off behaviours that apply to
the employee.
iv. Adjective rating scale appraisal: Appraiser rates employee on a
number of job‐related factors.
v. Forced­choice appraisal: In order to reduce bias, appraisers
choose statements which best describe the employee from sets of
statements, which appear to be equally favorable.
vi. Behaviourally Anchored Rating Scales (BARS): Appraiser rates
employees on factors which are defined by behavioral descriptions
illustrating various points along each rating scale.

B. Relative standards: In this method employees are compared to each

other.
i. Group order ranking: Employees are placed in a classification
reflecting their relative performance, such as “top on‐fifth.”
ii. Individual ranking: Employees are ranked from highest to lowest.
iii. Paired comparison: Each individual is compared to every other;
final ranking is based on number of times the individual is preferred
member in a pair.

C. Objectives Based Method

i. Employees can be evaluated on how well they achieve specific
objectives.
ii. A formal approach to using objectives is Management by
Objectives (MBO). It consists of four steps: goal setting, action
planning, self‐control and periodic reviews.

VII. Factors That Can Distort Appraisals

A. Leniency error
i. Each evaluator has his/her own value system.
ii. Some evaluate high (positive leniency) and others, low.

Course material prepared by Dr.A.Venkat Raman, FMS, University of Delhi, for class purpose only. The supplementary 29
reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.
 B. Halo error: The tendency to let an assessment of an individual on one trait
influence evaluation on other, different traits.

C. Similarity error: Occurs when an evaluator rates others in the same way
that the evaluator perceives him or herself.
D. Low appraiser motivation: Evaluators may not feel that it is worthwhile
spending the time to do a thorough evaluation, or may be reluctant to be
accurate if important rewards for the employee depend on the results.
E. Central tendency: The reluctance to use the extremes of a rating scale and
to adequately distinguish among employees being rated.

F. Inflationary pressures: Pressures for equality and fear of retribution for

low ratings leads to less differentiation among rated employees.

G. Inappropriate substitutes for performance: Effort, enthusiasm,

appearance, etc. are more appropriate for some jobs than others.

H. Attribution Theory
i. Biases often result when we decide whether someone’s performance
is due to internal factors they can control or external factors which
they cannot; e.g. if poor performance is attributed to internal control,
the judgment is harsher than when it is attributed to external
control.

ii. Impression management refers to efforts by employees to obtain

higher ratings by portraying an image desired by their supervisors.

VIII. Creating More Effective Performance Management Systems

A. Use behaviour­based measures: Measures based on specific descriptions

of behaviour are more job‐related and elicit more inter‐rater agreement
than traits, such as “loyalty” or “friendliness.”

B. Combine absolute and relative standards: Absolute standards tend to be

positively lenient; relative standards suffer when there is little variability.

C. Provide ongoing feedback: Expectations and disappointments should be

shared with employees on a day‐to‐day basis.

D. Have multiple raters: Increasing the number leads to more reliable and
valid ratings.
i. Use peer evaluations: Co‐workers offer constructive and specific
evaluations; upward appraisals allow employees to give their
managers feedback.
ii. 360­Degree appraisals: Supervisors, peers, employees, customers
and others with relevant information evaluate the employee.

Course material prepared by Dr.A.Venkat Raman, FMS, University of Delhi, for class purpose only. The supplementary 30
reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.
 E. Rate Selectively

i. Appraisers only evaluate in those areas about which they have

sufficient knowledge.
ii. More effective raters are asked to do the appraisals.

F. Train appraisers: Untrained appraisers can demoralize employees and

increase legal liabilities.

IX. International Performance Appraisal

A. Who performs the evaluation?

i. Different cultural perspectives between the parent and local country

may make evaluation difficult.
ii. Evaluation forms may not be translated accurately.
iii. Quantitative measures may be misleading because regulations,
accounting practices, and chances for success differ across countries.

B. Which evaluation format will be used?

i. May make sense to use different forms for parent‐country nationals

and host‐country nationals.
ii. Performance criteria for a particular position should be modified to
fit the overseas position and site.
iii. Include a current expatriate’s insights as part of the evaluation.

Review:

™ Purposes of Performance Management

The purposes of performance management systems are feedback, development,

and documentation. Performance appraisals are designed to support the em‐
ployees, the appraisers, and the organization.

™ Appraisal Process: A Description

The six‐step appraisal process is as follows:

a. Establish performance standards with employees.

b. Manager and employee set measurable goals.
c. Measure actual performance.
d. Compare actual performance with standards.
e. Discuss the appraisal with the employee.

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reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.
f. If necessary, initiate corrective action.
™ Advantages and Disadvantages of Absolute Standards and Relative
Standards

Absolute standards refer to a method in performance management systems

whereby employees are measured against company‐set performance
requirements. Absolute standard evaluation methods involve the essay
appraisal, the critical incident approach, the checklist rating, the graphic rating
scale, the forced‐choice inventory, and the behaviourally‐anchored rating scale
(BARS).

Relative standards refer to a method in performance management systems

whereby employees' performance is compared to that of other employees.
Relative standard evaluation methods include group order ranking, individual
ranking, and paired comparisons.

The advantage of absolute standards is that employees can be assessed as

adequate against the external standard, but there is no indication of how
employees compare to each other. With relative standards, the opposite is true.
The advantage is that employees are compared to each other, but there is no
external yardstick.

™ BARS: Is BARS better than Trait­Oriented Measures?

A Behaviourally Anchored Rating Scale (BARS) is an absolute assessment

technique. Critical incidents are identified, and a range of performance
possibilities (from poor to good) is described for each dimension. This
behavioural–based measure is preferable to a trait–oriented measure because it
captures actual observable, job performance rather than a trait that may or may
not influence performance.

™ MBO

Management by Objectives (MBO) is an approach to appraisal that makes use of

objectives. Organizational objectives are converted into individual objects in a
four–step process: goal setting, actual planning, self–control, and periodic
reviews.

™ Factors that distort Performance Appraisals

Performance appraisal might be distorted for a number of reasons, such as

leniency error, halo error, similarity error, central tendency, low appraiser
motivation, inflationary pressures, and inappropriate substitutes for
performance.

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reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.
 ™ "Performance Appraisal is a two­way street. Supervisors evaluate
their subordinates, and subordinates should evaluate their
supervisors."

The subordinate is in a unique position to evaluate the work of a supervisor. To

the extent that the supervisor's work is the direction of subordinates, those
workers are the 'experts' on that subject. However, the supervisor's job is larger
than the portion of it that the subordinate sees. Therefore, the subordinate has
no knowledge of and no valid opinion about, the rest of the supervisor's job.

™ "The higher the position an employee occupies in an organization,

the easier it is to appraise his or her performance objectively."

Externally reported figures are usually available from the business unit on up.
Performance figures can be tied to profit and loss, and overall business unit
success. But, the numbers do not always tell the whole story. Turnover, and
employee problems may not show up in the numbers. Also, some problems may
not appear in the short‐ term. Further, external influences may help determine
the numbers, beyond the performance of the employee.

™ "Using a Performance Evaluation instrument that is not valid is a

waste of time."

Such a process can be more than a waste of time. It can damage trust, loyalty,
commitment and performance for both employees and managers, if individuals
believe that the ratings are unfair or meaningless. However, it depends on how
the evaluation instrument is used. If ratings are primarily used to stimulate an
honest discussion between manager and employee, the quality of the ratings
themselves is not as important as the usefulness of the communications process.
Even if ratings are the basis for decision‐making, no form is perfectly valid but
using multiple raters, training raters, and providing behaviour‐based guidelines
to help raters make judgments, can improve ratings.

Notes:

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reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.
Course material prepared by Dr.A.Venkat Raman, FMS, University of Delhi, for class purpose only. The supplementary 34
reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.
 TRAINING AND DEVELOPMENT

I. Introduction

ƒ Organizations are dynamic

ƒ Rate of Change is faster than ever before
ƒ Change is too rapid, continuous and stressful
ƒ Response time for decisions get shorter and shorter
ƒ Rapid technological advances lead to faster obsolescence
ƒ Increasing competition and the need for competitive advantages keeps
organizations to facilitate organization wide learning and continuous
improvement
ƒ Information explosion had necessitated managers to be sophisticated and
accurate in strategic business decisions
ƒ Traditional management styles are no longer effective in the new work
places
ƒ New leadership styles are thrust on managers, as more skilled workforce is
entering the workforce. Need to move from “task masters” to “team
managers”
ƒ Globalisation had necessitated the managers to be sensitive to cultural
factors at work place

II. What is Employee Training?

A. Definitions

i. Employee training is a learning experience designed to achieve a

relatively permanent change in an individual that will improve the
ability to perform on the job.
ii. Employee development is future‐oriented training, focusing on the
personal growth of the employee

III. Organizational Factors Influencing the Training and Development

i. Size of the Organization

ii. Organization of the Training Department
iii. Organization’s Corporate Strategy
iv. Technology employed
v. Management Support and Attitude towards training
vi. Financial components (Cost & Benefit) of Training
vii. Capability of the Training Staff
viii. Training of Trainers
ix. Legal Issues in Training, if any.

III. Training Stages/ Phases.

Course material prepared by Dr.A.Venkat Raman, FMS, University of Delhi, for class purpose only. The supplementary 35
reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.
 There are four distinct but interrelated stages of training and development. They
are,
Need Assessment Stage
Design and Objective Setting Stage
Implementation or Conduct Stage
Evaluation and Feedback Stage

A. Determining Training Needs:

i. Training needs could be broadly categorised as, Performance

discrepancy needs or Anticipatory needs.
ii. Specific training goals should be based on the organization’s strategy
and a determination of what work needs to be done and the skills
necessary to complete the work.
iii. Drops in productivity or increased rejects may indicate a need for
more training.
iv. The costs of training, relative to the benefits, must be considered.
v. Understand whether training addresses the trainable deficiency or
there is a problem of motivation

B. Training Approaches

i. On­the­job training is widely used and effective when the damage

trainees can do is minimal.
a. Apprenticeship training puts trainees under the guidance
of a master worker, typically for 2‐5 years.
b. Job Instruction Training (JIT) is systematic approach
consisting of preparing the trainees, presenting the
instruction, having trainees try out the job, and placing
trainees on the job with a designated resource person.

ii. Off­the­job training includes a variety of techniques, such as

lectures, films, demonstrations and simulation exercises.

a.
Programmed instruction is an approach that puts material
to be learned into highly organized, logical sequences that
require the trainee to respond.
b. Interactive videodisks allow users to make changes and
selections as they interact with a personal computer, which
includes video pictures.
c. Virtual reality systems simulate actual work activities by
sending messages to the brain, thereby allowing individuals
to interact with the simulated environment as if they were
really there.
IV. Employee Development

Course material prepared by Dr.A.Venkat Raman, FMS, University of Delhi, for class purpose only. The supplementary 36
reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.
 A. This future‐oriented set of activities is predominantly an educational
process. In today’s work environment, all employees can benefit from the
methods previously used to develop managerial personnel
B. Employee development methods

i. Job rotation involves moving employees to various positions in the

organization to expand their skills, knowledge and abilities.
ii. Assistant­to positions allow employees with potential to work
under and be coached by successful managers.
iii. Committee assignments provide opportunities for decision‐
making, learning by watching others, and becoming more familiar
with organizational members and problems.
iv. Lecture courses and seminars benefit from today’s technology and
are often offered in a distance‐learning format.
v. Simulations include case studies, decision games and role‐plays.
vi. Outdoor training typically involves major emotional and physical
challenges, which teach trainees the importance of teamwork.

V. Organization Development

A. OD efforts support changes that are made in the organizations systems,

technology, processes and people in line with the strategic direction of the
business. In today’s business environment, change is described by the
“white water” metaphor that reflects the uncertain and dynamic nature of
change.

B. OD Methods

i. Climate Surveys ask organizational members for their perceptions

and attitudes. The summarized data are used to identify problems
and clarify issues so that commitments to action can be made.
ii. Team building may include goal setting, development of
interpersonal relationships, clarification of roles and team process
analysis to increase trust, openness, and team functioning.
iii Third­party interventions use a facilitator to help different
organizational groups to change the attitudes, stereotypes and
perceptions they have of each other.

C. The role of change agents

i. Change agents may be internal, training and development
employees, or external consultants.
ii. They must understand organizational dynamics, have outstanding
communication skills, and be skilled at taking risks to support
change.

D. The Learning Organization

Course material prepared by Dr.A.Venkat Raman, FMS, University of Delhi, for class purpose only. The supplementary 37
reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.
 1. As described by MIT Professor Peter Senge, this type of organization
values continued learning and fosters an environment where open,
trusting relationships result in organizational revitalization.
2. Learning organizations are characterized by:
a. Systems thinking
b. Personal mastery
c. Mental models (ways of doing things)
d. Shared vision
e. Team learning

VI. Evaluating Training and Development Effectiveness

A. How do we evaluate training programs? Typically, employee and

manager opinions are used. These opinions, or reactions are not
necessarily valid measures, since they are influenced by things like
difficulty, entertainment value, or personality of the instructor.
Performance‐based measures are better indicators of training’s cost‐
effectiveness.

B. Performance‐based evaluation measures

i. Post­training performance method. Employees’ on‐the‐job

performance is assessed after training.
ii. Pre­post­training performance method. Employee’s performance
is assessed both before and after training, to determine whether a
change has taken place.
iii. Pre­post­training performance with control group method. This
sophisticated technique compares the pre‐post‐training results of
the trained group with the job performance at the same points in
time of a control group, which does not undergo instruction. The
approach is used to control for factors other than training, which
may affect job performance over time.

VII. International Training and Development Issues

A. Training

i. Cross‐cultural training is necessary for expatriate managers and

their families before assignments (to learn language and culture);
during, and after foreign assignments (to adjust to changes back
home).
ii. Cross‐cultural training is more than language training; it includes
learning about the culture’s history, politics, economy, social and
business practices and may involve role‐playing, simulations and
immersion in the culture.

Course material prepared by Dr.A.Venkat Raman, FMS, University of Delhi, for class purpose only. The supplementary 38
reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.
 B. Development.

i. Often, organizations do not do a good job of planning for the return

of overseas managers. This leads to the managers’ being frustrated
with lack of recognition and opportunity back home and to others’
reluctance to take overseas assignments.
ii. Expatriates can be assigned a domestic position, can prepare for a
new overseas assignment, can retire or be terminated.

Review:

™ Why Managers could be so negative about training?

One reason for their lack of support may be that they have had previous negative
experiences. Training that is not based on needs assessment and an understanding of
learning principles may be a waste of time and money. Another reason may be that they
feel threatened by the idea. Sometimes training needs assessment and discussions with
employees during training reveal management deficiencies. Training may make
employees more aware of the support they need from management, in the form of clear
instructions, equipment, and time to pay attention to quality and customer needs.

™ Signals that warn a manager that employee training may be necessary

Training is needed when incumbents do not have the skills, knowledge or attitudes to
perform necessary behaviours to do the work of the organizations. Such needs are
signalled in various ways. Low job performance or a drop in productivity, high reject
rates or larger than acceptable scrap, all may indicate training needs. Other factors that
may cause poor performance, such as poor equipment or bad supervision, should be ruled
out before training is offered.

™ How to obtain support needed for a successful quality program?

First, the coordinator needs to understand the managers’ perspectives and the nature of
the organizational problems. This is probably best done using an OD approach, which
emphasizes the entire organizational system. The coordinator needs to start by talking to
the plant manager, and making sure that the executives recognize the need for changes
and are motivated to support change. If they are not, perhaps the coordinator can get
commitment from the plant manager to collect some data on scrap, waste, customer
satisfaction, etc. A discussion of this data and alternative ways to improve productivity
and morale may make the need for quality training clear. Or, perhaps there are other
approaches that may work best to start, such as raising work standards.

™ Why Evaluation of training effectiveness necessary?

Course material prepared by Dr.A.Venkat Raman, FMS, University of Delhi, for class purpose only. The supplementary 39
reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.
Training effectiveness should be evaluated for several reasons. First, training cannot be
improved unless its effectiveness is evaluated. Second, evaluation is a fact of life for
operational divisions of a firm. Evaluation helps give credibility to trainers and the
training function. Third, communications with other divisions are enhanced by speaking a
common language of evaluation. Fourth, tracking training effectiveness is useful to use
for long‐term planning and strategic organizational development interventions in the
firm.

™ Importance of Cultural Training for employees on overseas assignment

Most of the problems in overseas assignments are cultural, not technical, in nature.
Further, expatriates who have good cultural training before departure experience less
difficulty in the overseas assignment and when they return. It is costly to send an
employee overseas, and the company loses when a valuable employee must return early
because his/her family cannot adjust or when a frustrated manager leaves the company
shortly after his/her return from the assignment.

™ Training programs are frequently the first casualties when management

wants to cut costs. Why?

Cost cutting targets nonessential or extraneous items in the short run. Training often falls
into this category because human resource managers do not evaluate their programs
carefully enough to demonstrate value to the organization. Also, if training is performed
based on what the training department can do or likes to do, instead of on what skills and
behaviours the organization needs to have in its employees, training is not part of the
strategic goal setting of the organization. Again, it is an easy target for short‐term
solutions.
When training departments are eliminated in long‐term strategic plans, they have not
demonstrated their ability to meet needs of the organization; they have not been in tune
with the company.

Notes:

Course material prepared by Dr.A.Venkat Raman, FMS, University of Delhi, for class purpose only. The supplementary 40
reading material has been prepared based on DeCenzo & Robbins (1999), book outline, with permission from John Wiley.