Human Resources Management

Introduction to HRM
Aradhna Malik (PhD)
Assistant Professor
VGSoM, IIT Kharagpur
 Sources
Briscoe, D.R., Schuler, R. S. & Claus, L. (2009).
International human resource management: Policies
and practices for multinational enterprises. NY:
Routledge.
Cascio, W. F. (2003). Managing human resources:
Productivity, quality of work life, profits. New Delhi:
Tata McGraw Hill.
Gomez-Mejia, L. R., Balkin, D. B. & Cardy, R. L. (2012).
Managing human resources (7 th Ed.). New Delhi: PHI
Ltd.
Pande, S. & Basak, S. (2012). Human resources
 Basic concepts (Gomez-Mejia, Balkin & Cardy, 2012)
 Human resources (HR): “People who work in an
organization”
Discuss whether the above should be called
‘personnel’ or ‘human resources’ and why?
 Manager: “A person who is in charge of others and
is responsible for the timely and correct execution
of actions that promote his or her unit’s success
 Line employee: “Employee involved directly in
producing the company’s good(s) or delivering the
service(s)”
 Staff employee: “An employee who supports line
employees”
Evolution of HRM (Pande & Basak, 2012)
 1800 BC: Minimum wage rate and incentive wage plan – Babylonian
code of Hammurabi.
 300 BC: Kautilya’s Arthashastra
 India:
 1920s: interest in management as a discipline
 1931: Government intervening to protect the interests of workers through
the appointment of labour welfare officers.
 1948: Factories Act: Appointment of labour welfare officers compulsory.
 1970s: Shift of focus from concern for the welfare of people to concern
for the performance of organizations.
 1980: National Institute of Labour Management & Indian Institute of
Personnel Management merged to form the National Institute of
Personnel Management.
 1980s: Personnel management morphed into HR as new technologies
came to be discussed to manage people and their differences.
 1990: American Society of Personnel Management renamed itself as
The Society of Human Resource Management.
 Defining HRM (Pande & Basak, 2012)

 50 years ago: “Personnel management aims to

achieve both efficiency and justice. It seeks to
bring together and develop into an effective
organization the men and women who make up
the enterprise, enabling each to make his own
best contribution to its success. It seeks to
provide fair terms and conditions of
employment and satisfying work for those
employed.”
Personnel management & HRM
(Pande & Basak, 2012)

Personnel Management Human Resource Management

Reactive, servicing role Proactive, innovative role
Emphasis on implementation of Emphasis on strategy
procedures
Specialist department General management activity
Focus on employees’ need in Focus on employees’ requirements in
their own right the light of business needs
Employees seen as a cost to be Employees seen as an investment to be
controlled nurtured as well as a cost to be
controlled
Presumption of union manager Conflicts dealt with by team members
conflicts within their teams
Preference for collective Management led planning of people
bargaining of pay and working resources & employment conditions
conditions
Personnel management & HRM
(Pande & Basak, 2012)

Personnel Management Human Resource Management

Emphasis on settling pay more in Emphasis on competitive pay and
terms of the organization’s internal conditions to stay ahead of competitors
market
Serving other departments/ units Contributing ‘added value’ to business

Supporting change Stimulating change

Challenging business goals in the Total commitment to business goals
light of effect on employees
Less flexible approach to staff Completely flexible approach to staff
deployments deployment
The HRM System (Cascio, 2003)
 Staffing
 Identifying work requirements within an organization
 Determining the numbers of people and the skills mix necessary to do the
work
 Recruiting selecting and promoting qualified candidates
 Retention
 Rewarding employees for performing their jobs effectively
 Ensuring harmonious working relations between employees and managers
 Maintaining a safe, healthy work environment
 Development: To preserve and enhance employees’ competence in
their jobs by improving their knowledge, skills, abilities, and other
characteristics (Competencies)
 Adjustment: Activities intended to maintain compliance with the
organization’s HR policies (e.g. discipline) and business strategies)
 Managing change: Ongoing process whose objective is to enhance
the ability of an organization to anticipate and respond to
developments in its external and internal environments, and to enable
employees at all levels to cope with the changes
Responsibilities of HR Department
(Cascio, 2003)

Activity Responsibility of HR Department

Staffing Job analysis, human resource planning, recruitment, compliance
with civil rights laws and regulations, application blanks, written
tests, performance tests, interviews, background investigations,
reference checks, physical examinations
Retention Compensation and benefits, employee relations, health and
safety, employee services
Development Development of legally sound performance management
systems, morale surveys, technical training, management and
organizational development, career planning, counseling, HR
research
Adjustment Investigation of employee complaints, outplacement services,
retirement counselling

Managing change Provide expertise to facilitate the overall process of managing

change
Challenges of HRM (Gomez-Mejia, Balkin & Cardy, 2012)
 Environmental challenges: “Forces external to
the firm”
 Rapid change
 New company townships
 Dealing with stress
 Rise of the Internet
 Necessitating better written communication skills
 Dealing with information overflow
 Breaking down labor market barriers – workers &
companies know where to get what they need
 Using online learning
 Enabling HR to focus on management
Challenges of HRM (Contd.)
(Gomez-Mejia, Balkin & Cardy, 2012)
 Environmental challenges (Contd.)
 Globalization
 Worldwide company culture
 Worldwide recruiting
 Industrial metamorphosis
 Global alliances
 A virtual workforce
 The global enterprise
 Wage competition
 Legislation
 Evolving work and family roles: Dual career families, changing
family structure, etc.
 Skill shortages & rise of the service sector
 Natural disasters
Challenges of HRM (Contd.)
(Gomez-Mejia, Balkin & Cardy, 2012)

 Organizational challenges: “Concerns or

problems internal to a firm”
 Competitive position: Cost, quality, or distinctive
capabilities
 Controlling costs
 Improving quality
 Creating distinctive capabilities
 Decentralization
 Downsizing
 Organizationalrestructuring
 Self managed work teams
 Growth of small businesses
Challenges of HRM (Contd.)
(Gomez-Mejia, Balkin & Cardy, 2012)
 Organizational challenges (Contd.):
 Organizational culture: “Basic assumptions and beliefs shared
by members of an organization”
 “Observed behavioral regularities
 Norms
 Dominant values espoused by an organization
 Philosophy that guides organization’s policy
 Rules of the game
 Feeling or climate
 Technology
 Rise of telecommuting
 Ethics of proper data use
 Electronic monitoring
 Medical testing
 Increase in egalitarianism
Challenges of HRM (Contd.)
(Gomez-Mejia, Balkin & Cardy, 2012)

 Organizational challenges (Contd.)

 Internalsecurity
 Data security
 Outsourcing
 Product integrity
Challenges of HRM (Contd.)
(Gomez-Mejia, Balkin & Cardy, 2012)

 Individual challenges:
 Matching people and organizations
 Ethics and social responsibility
 Productivity
 Employee ability
 Motivation
 Empowerment
 Brain drain
 Job insecurity
Responses of firms to the new competitive
realities (Cascio, 2003)
 Smaller companies that employ fewer people
 The shift from vertically integrated hierarchies to networks of
specialists
 Technicians, ranging from computer repair specialists to radiation
therapists, replacing manufacturing operatives as the worker elite.
 Pay tied less to a person’s position or tenure in an organization
and more to the market value of his or her skills
 A change in the paradigm of doing business from making a
product to providing a service, often by part-time or temporary
employees
 Outsourcing of activities that are not core competencies of a firm
(e.g. Payroll, or Collections, or downsizing – movie Up in the air)
 Redefinition of work itself: Constant learning, more higher order
thinking, less nine to five mentality
Responses of firms to the new competitive
realities (Contd.) (Cascio, 2003)
 New forms of organization: Virtual, offshoring,
telecommuting
 Restructuring, including downsizing
 Total quality management
 Reengineering: Fundamental rethinking and
radical redesign of business processes to
achieve dramatic improvements in cost, quality
and speed.
 Flexibility
Why does effective HRM matter?
(Cascio, 2003)

 Personnel selection
 Job design
 Information sharing
 Performance appraisal
 Promotion systems
 Attitude assessment
 Incentive systems
 Grievance procedures
 Labour management participation
HR managers try to answer the following
questions (Cascio, 2003)
 Who specifies the content of each job?
 Who decides how many jobs are necessary?
 How are the interrelationships among jobs
determined and communicated?
 Has anyone looked at the number, design and
content of jobs from the perspective of the entire
organization? What is the big picture?
 What should training programs stress?
 How should performance on each job be measured?
 How much is each job worth?
Planning and implementing strategic
HR policies (Gomez-Mejia, Balkin & Cardy, 2012)
Strategic HR planning: “Process of formulating HR
strategies & establishing programs or tactics to
implement them.”
 Benefits:
 Encouragement of proactive rather than reactive behavior
 Explicit communication of company goals
 Stimulation of critical thinking and ongoing examination of
assumptions
 Identification of gaps between current situation and future vision
 Encouragement of line managers’ participation
 Identification of HR constraints and opportunities
 Creation of common bonds
Challenges of strategic HR planning
(Gomez-Mejia, Balkin & Cardy, 2012)
 Maintaining a competitive advantage
 Reinforcing overall business strategy
 Avoiding excessive concentration on day to day
problems
 Developing HR strategies suited to unique
organizational features
 Coping with the environment
 Securing management commitment
 Translating the strategic plan into action
 Combining intended and emergent strategies
 Accommodating change
Strategic HR Choices
(Gomez-Mejia, Balkin & Cardy, 2012)

Strategic HR choices: Options it has available in designing its

HR system
 Work flows:
 Efficiency/ innovation
 Control/ flexibility
 Explicit/ broad job descriptions
 Detailed/ loose work planning
 Staffing:
 Promoting from within/ hiring from outside
 Empowering immediate supervisors/ centralizing decisions in HR
dept
 Emphasizing good fit between applicant/ hiring most
knowledgeable applicant regardless of interpersonal considerations
 Hiring new workers informally/ formal & systematic hiring
Strategic HR Choices (Contd.)
(Gomez-Mejia, Balkin & Cardy, 2012)

 Employee separations
 Voluntary inducements (e.g.VRS)/ layoffs
 Hiring freeze/ recruiting as needed
 Continued support to separated employees/ leaving them to fend
for themselves
 Committing to rehiring laid off employees / fresh unbiased
recruitment if circumstances permit
 Performance appraisal
 Customised/ standardized appraisal system
 Appraisal data as developmental tool/ control mechanism
 Designing appraisal system with multiple objectives/ narrow
purpose
 Appraisal system with active participation/ only inputs from
employees
Strategic HR Choices (Contd.)
(Gomez-Mejia, Balkin & Cardy, 2012)

 Training and career development

 Individual/group training
 Training on the job/ by external agencies
 Job specific/ generic training
 Hiring external experts at a higher wage/ training own
employees to become experts
 Compensation
 Fixedsalary and benefits/ variable compensation
 Compensation based on position/ individual contribution
 Rewarding for length of service/ performance
 Centralizing pay decisions/ empowering supervisors to
make pay decisions
Strategic HR Choices (Contd.)
(Gomez-Mejia, Balkin & Cardy, 2012)

 Employee & labor relations

 Top-down communication/ bottom-up feedback
 Avoiding or suppressing/ dealing with unions
 Adversarial approach/ responding to employee
needs
 Employee rights
 Discipline/proactive encouragement for
appropriate behavior
 Employer’s / employee’s interest
 Informal/ explicit standards and procedures for
ethical behavior
Strategic HR Choices (Contd.)
(Gomez-Mejia, Balkin & Cardy, 2012)

 International management
 Creating common company culture to reduce
inter-country cultural differences/ expecting
foreign subsidiaries to adapt to local culture
 Sending expats to / hiring locals in foreign country
offices
 Repatriation agreement with/ no commitment to or
from employees on foreign assignments
 Centralized/ decentralized company policies for
multi-country operations
Selecting HR strategies to increase firm
performance (Gomez-Mejia, Balkin & Cardy, 2012)
 “The better the match between the HR strategy & the
firm’s overall organizational strategies
 The more the HR strategy is attuned to the
environment in which the firm is operating
 The more closely the HR strategy is moulded to
unique organizational features
 The better the HR strategy enables the firm to
capitalize on its distinctive competencies
 The more the HR strategies are mutually consistent or
reinforce one another”
 And eventually, the better the firm performance
Thank You
 Human Resources Management

Job Analysis & Design

Aradhna Malik (PhD)

Assistant Professor
VGSoM, IIT Kharagpur
 Sources
Briscoe, D.R., Schuler, R. S. & Claus, L. (2009).
International human resource management: Policies
and practices for multinational enterprises. NY:
Routledge.
Cascio, W. F. (2003). Managing human resources:
Productivity, quality of work life, profits. New Delhi:
Tata McGraw Hill.
Gomez-Mejia, L. R., Balkin, D. B. & Cardy, R. L. (2012).
Managing human resources (7 th Ed.). New Delhi: PHI
Ltd.
Pande, S. & Basak, S. (2012). Human resources
 Basic concepts (Gomez-Mejia, Balkin & Cardy, 2012)
 Human resources (HR): “People who work in an
organization”
Discuss whether the above should be called
‘personnel’ or ‘human resources’ and why?
 Manager: “A person who is in charge of others and
is responsible for the timely and correct execution
of actions that promote his or her unit’s success
 Line employee: “Employee involved directly in
producing the company’s good(s) or delivering the
service(s)”
 Staff employee: “An employee who supports line
employees”
HR managers try to answer the following
questions (Cascio, 2003)
 Who specifies the content of each job?
 Who decides how many jobs are necessary?
 How are the interrelationships among jobs
determined and communicated?
 Has anyone looked at the number, design and
content of jobs from the perspective of the entire
organization? What is the big picture?
 What should training programs stress?
 How should performance on each job be measured?
 How much is each job worth?
Basic Concepts (Cascio, 2003; Gomez-Mejia, Balkin & Cardy, 2012)
 Business processes: “Value adding, value creating activities such
as product development, customer service, & order fulfilment”
 Business process re-engineering: “Fundamental re-thinking &
radical re-design of business processes to achieve dramatic
improvements in cost, quality, service, & speed.”
 Job design: “The process of organizing work into the tasks
required to perform a specific job”
 Job analysis: The process of obtaining information about jobs
 Job description: An overall written summary of task requirements
 Job specification: An overall written summary of worker
requirements
 Work flow: “The way we work is organized to meet the
organization’s production or service goals.”
 Work flow analysis: “Examin[ation of] how work creates or adds
value to the ongoing business processes”
Why study job requirements? (Cascio, 2003)
 Organizational structure and design
 Human resource planning
 Job evaluation and compensation
 Recruitment
 Selection
 Placement
 Orientation, training, and development
 Performance appraisal
 Career path planning
 Labor relations
 Engineering design and methods improvement
 Job design
 Safety
 Vocational guidance and rehabilitation counseling
 Job classification systems
Types of organizational structure
(Gomez-Mejia, Balkin & Cardy, 2012)

 Bureaucratic organizational structure:

 Top down management approach
 Many levels of management
 Hierarchical career paths within one function
 Highly specialized jobs
 Narrowly specified job descriptions
 Rigid boundaries between jobs & units
 Employees or individuals working independently
Types of organizational structure
(Contd.) (Gomez-Mejia, Balkin & Cardy, 2012)

 Flat:
 Decentralized management approach
 Few levels of management
 Horizontal career paths that cross functions
 Broadly defined jobs
 General job descriptions
 Flexible boundaries between jobs and units
 Emphasis on teams
 Strong focus on the customer
 Boundaryless
 Joint
ventures with customers, suppliers & competitors
 Emphasis on teams whose members may cross organizational
Process based organizations (Cascio, 2003)
 A process is a collection of activities (such as
procurement, order fulfillment, product development,
or credit issuance), that takes one or more kinds of
input and creates an output that is of value to a
customer.
 Priorities of a process based organization:
 Identification of job specifications (i.e. The personal
characteristics – knowledge, skills, abilities, and other
characteristics – necessary to do the work)
 Identification of the environment, context, and social
aspects of work
 A change in emphasis, from describing jobs to describing
 Job characteristics theory
(Gomez-mejia, Balkin & Cardy, 2012)
“States that employees will be more motivated to work and more
satisfied with their jobs to the extent that jobs contain certain core
characteristics, as these will lead to psychological states that will
further lead to specific work outcomes.”
 Core job characteristics:
 Skill variety: Degree to which a job requires a person to do different
things
 Task identity: Degree to which a person can do the job from beginning
to end with a visible outcome
 Task significance: Degree to which the job has a significant impact on
others – inside & outside
 Autonomy: Amount of freedom, independence, & discretion the
employee has in areas such as scheduling the work, making decision,
& determining how to do the job”
 Feedback: Degree to which the job provides the employee with clear &
 Job characteristics theory (Contd.)
(Gomez-mejia, Balkin & Cardy, 2012)
 Physiological state affected by job characteristics
 Experienced meaningfulness: Extent to which the employee
experiences the work as important, valuable, & worthwhile
 Experienced responsibility: Degree to which the employee feels
personally responsible or accountable for the results of the work
 Knowledge of results
 Personal & work outcomes:
 High internal work motivation
 High quality work performance
 High satisfaction with the work
 Low turnover & absenteeism
 Link between core job characteristics & outcomes – Strength of
relationships which is determined by intensity of employee
growth need, which thrives on & affects feedback & commitment
Characteristics of jobs (Cascio, 2003)
 Dynamic characteristics
 Time
 People
 Environment and context
 Job specifications and people requirements
 Minimally acceptable qualifications and skills
 Ideal qualifications and skills
 Legal Issues: India
 Religious minorities and the Indian Constitution
(https://www.nls.ac.in/csseip/Files/Material%20for
%20uploading/Minorities.pdf)
 The Persons with Disabilities (Equal Opportunities,
Protection of Rights and Full Participation) Act, 1995
(http://socialjustice.nic.in/pwdact1995.php)
 National Commission for Backward Classes Act,
1993 (http://socialjustice.nic.in/pdf/ncbcact1993.pdf)
 National Commission for Backward Classes Rules,
1994 (http://socialjustice.nic.in/ncbcrules94.php)
 How do we study job requirements
(Cascio, 2003)

 Job performance: Actual experience on the job

 Observation: Physical first hand observation of people at
work
 Interview: Descriptions of workers
 Critical incidents: Reports of significant incidents
highlighting effective and ineffective worker behaviors
 Structured questionnaires: Job oriented. e.g. Position
Analysis Questionnaire – 194 items in following categories
 Information input
 Mental processes
 Work output
 Relationships with other persons
 Designing jobs (Gomez-mejia, Balkin & Cardy, 2012)
 Job design: “The process of organizing work
into the tasks required to perform a specific job”
 Influences:
 Work flow analysis
 Business strategy

 Organizational structure
 Approaches to job design (Gomez-mejia, Balkin & Cardy, 2012)
 Work simplification: “Assumes that work can be broken down
into complete, repetitive tasks that maximise efficiency”
 Work elimination: Combining tasks or eliminating parts of
tasks that one can do without
 Job enlargement: Expansion of a job’s duties
 Job rotation: “Rota[tion] of workers among different narrowly
defined tasks without disrupting the flow of work”
 Job enrichment: “Puts specialized tasks back together so
that one person is responsible for producing a while product
or an entire service”
 Team based job designs: “Focus on giving a team, rather
than an individual, a whole and meaningful piece of work to
do. Team members are empowered to decide among
themselves how to accomplish the work.”
 Job analysis (Gomez-mejia, Balkin & Cardy, 2012)
 “Task: Basic element of work that is a logical
and necessary step in performing a job duty
 Duty consists of one or more tasks that
constitute a significant activity performed in a
job
 Responsibility is one or several duties that
identify and describe the major purpose or
reason for the job’s existence.”
Methods of gathering job
information (Gomez-Mejia, Balkin & Cardy, 2012)
 Interviews
 Observation
 Diaries
 Questionnaires
 Internet-based data collection
Why analyze jobs?
(Gomez-Mejia, Balkin & Cardy, 2012)

 Recruitment
 Selection
 Performance appraisal
 Compensation
 Training & career development
 Techniques of job analysis
(Gomez-Mejia, Balkin & cardy, 2012)
 Task Inventory Analysis: “Used to determine knowledge, skills,
and abilities (KSAs)”
Steps:
 Interview
 Survey
 Generation of a task by the KSA matrix
e.g.
http://nau.edu/human-resources/management-resources/hiring-selec
tion/applicant-evaluation/sample-matrices/
 Critical Incident Technique: “Supervisors & workers generate
behavioral incidents of job performance.
Steps:
 Generate dimensions
 Generate incidents
 Retranslate
 Techniques of job analysis (Contd.)
(Gomez-Mejia, Balkin & cardy, 2012)
 Position Analysis Questionnaire (PAQ): “Seeks to determine the degree
to which different items or job elements, are involved in performing a
particular job.” 194 items in six sections:
 Information input: Where & how a worker gets information needed to
perform the job
 Mental processes: Reasoning, decision-making, planning, & information-
processing activities involved in performing the job
 Work output: Physical activities, tools, & devices used by the worker to
perform the job
 Relationships with other persons
 Job context
 Other characteristics
 Functional Job Analysis (FJA):
 What the job incumbent does to people, data, & things
 Methods & techniques the job incumbent uses to perform the job
 Machines, tools & equipment used by the job incumbent
 Advantages & Disadvantages of Job Analysis Methods
(Cascio, 2003)

Method Advantages Disadvantages

Job Exposure to actual job tasks, physical, Inappropriate for jobs that require
performance environmental, & social demands of job. extensive training or are
Appropriate for hands on jobs that can hazardous to perform
be learnt quickly.
Observation Direct exposure can provide a richer, Not suitable for jobs that require
deeper understanding of job critical thinking and analysis.
requirements than second hand
information through peers.
Interviews Information about standard & Lack of faith in the interviewer can
nonstandard & mental work. Personal lead to distortion/ falsification of
reports about work that can’t be information.
observed or documented.
Critical Insight into job dynamics. Info can be Time consuming (gathering,
incidents used for job analysis. summarizing & categorizing
incidents).
Structured Cheap, quick, easy, can be done off Difficult to develop, explanations
questionnaire work, mass administration, quantifiable, may be required, impersonal.
analyzable.
 O*Net Content Model

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el_Summary.pdf
http://www.onetcenter.org/dl_files/ContentMod
el_Detailed.pdf
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el_DetailedDesc.pdf
 Relationship of job analysis to workforce
planning (Cascio, 2003)
 Types of plans
 Strategic: Plan about changing industry rules or creating tomorrow’s
industries
 Defining philosophy
 Formulating statements of identity, purpose and objectives
 Evaluating strengths, weaknesses, and competitive dynamics
 Determining design
 Developing strategies
 Devising programs
 Tactical/ Operational planning: Addresses issues associated with
the growth of current or new operations as well as with any specific
problems that might disrupt the pace of planned growth
 Workforce planning: Focuses on questions such as
 What do the proposed business strategies imply with respect to
human resources?
Foundations for workforce planning
(Cascio, 2003)
 What level will the wage rate for an occupation
be?
 How many people will be employed?
 How much more will the firm have to pay to
attract more employees?
 How would the number of people the company
employs change if the wage were lower?
 Activities comprising a workforce planning
system (Cascio, 2003)
 Talent inventory
 Workforce forecast
 Action plans
 Control and evaluation
 Talent inventories (TI) (Cascio, 2003)
 TI facilitates assessment of the current workforce
 Forecasts of workforce supply and demand help to
determine future needs
 Typical information included on a TI
 Current position info
 Previous positions in the company
 Other significant work experience
 Education (Degrees, licences etc.)
 Language skills and relevant international experience
 Training and development programs attended
 Community or industry leadership responsibilities
 Current and past performance appraisal data
 Disciplinary actions (when specifically required)
 Uses of a talent inventory (Cascio, 2003)
 Identification of candidates for promotion
 Management succession planning
 Assignment to special projects
 Transfers
 Training
 Workforce diversity planning and reporting
 Compensation planning
 Career planning
 Organizational analysis
 Workforce forecasts (Cascio, 2003)
 Estimate labor requirements at some time in future
 External: Depends on the external business environment
 Internal: Succession plan: Includes setting a planning
horizon, identifying replacement candidates for each key
position, assessing current performance and readiness for
promotion, identifying career development needs, and
integrating the career goals of individuals with company goals
 Types
 External and internal supply of labor
 Aggregate external and internal demand for labor

* Internal supply forecasts relate to conditions inside the

organization, such as the wage distribution of the workforce,
terminations, retirements, and new hires within job classes.
Concerns Regarding Job Analysis
(Gomez-Mejia, Balkin & Cardy, 2012)

 Legal compliance
 Organizational flexibility
Guidelines for conducting a job analysis
(Gomez-Mejia, Balkin & Cardy, 2012)

 Determine the desired applications of the job

analysis
 Select the jobs to be analyzed
 Gather the job information
 Verify the accuracy of the job information
 Document the job analysis by writing a job
description
Job Descriptions (Gomez-Mejia, Balkin & Cardy, 2012)
“Job description is a summary statement of the information
collected in the job-analysis process.”
Elements of a job description
 Make sure the job titles do not refer to a specific gender
 Make sure job descriptions are updated regularly so that
the date on the job description is current.
 Avoid inflating a job title to give the job a more impressive-
sounding status than it deserves
 Ensure that the supervisor of the job incumbent(s) verifies
the job description.
“Job summary is a short statement that summarizes the
job’s duties, responsibilities, and place in the organizational
structure.”
 Job Descriptions (Contd.)
(Gomez-Mejia, Balkin & Cardy, 2012)

 “Job duties & responsibilities explain what is done on the

job, how it is done, and why it is done.”
 “Job specifications section lists the worker characteristics
(KSAs) needed to perform a job successfully.
 “Minimum qualifications are the basic standards a job
applicant must have achieved to be considered for the job.”
Caution:
 A college degree should be a minimum qualification only of it is
related to the successful performance of the job
 Work experience qualifications should be carefully specified so
that they do not discriminate against a specific gender, minorities
or persons with disabilities, etc.
The Flexible Workforce (Gomez-Mejia, Balkin & Cardy, 2012)
 Core Workers: Have full time jobs & enjoy special
benefits/ privileges
 Contingent Workers: Hired as per need and
convenience; Are usually not paid as well as core
workers; Do not usually get special benefits/ privileges
 Temporary
 Part-time
 Outsourced/ subcontracted: Employees transfer routine or
peripheral work to another organization that specializes in
that work & can perform it more efficiently.
 Local
 Offshore
 Contract workers
Flexible work schedules (Gomez-Mejia, Balkin & Cardy, 2012)

 Flexible work hours: “Divide core schedules

into core time, when all employees are
expected to be at work, and flexible time
(flextime), when employees can choose to
organize work around personal activities.”
 Compressed workweeks: “Alter the number of
workdays per week increasing the length of
the work day to 10 or more hours”, & adjust
the number of hours accordingly
 Telecommuting: Working location not
specified/ flexible
 Forecasting workforce demand
(Cascio, 2003)
 Factors affecting the forecasting of workforce
demand
 Changes in technology
 Consumer attitudes and patterns of buying behavior
 Local, national, and international economies
 Number, size, and types of contracts won or lost
 Government regulations that might open new
markets or close off old ones
…
Selection Methods (Briscoe, Schuler & Claus, 2009)
 Interviews (international assignee and
spouse/ partner)
 Formal assessment
 Committee decision
 Career planning
 Self-selection
 Internal job posting and individual bid
 Recommendations
 Assessment centers
Thank You
 Human Resources Management

Employee Testing & Selection

Aradhna Malik (PhD)

Assistant Professor
VGSoM, IIT Kharagpur
 Sources
Angell, P. (2007). Business communication design (2nd
Ed.). NY: McGraw Hill.
Briscoe, D.R., Schuler, R. S. & Claus, L. (2009).
International human resource management: Policies and
practices for multinational enterprises. NY: Routledge.
Cascio, W. F. (2003). Managing human resources:
Productivity, quality of work life, profits. New Delhi: Tata
McGraw Hill.
Gomez-Mejia, L. R., Balkin, D. B. & Cardy, R. L. (2012).
Managing human resources (7th Ed.). New Delhi: PHI
Ltd.
Pande, S. & Basak, S. (2012). Human resources
management: Text and cases. New Delhi: Pearson.
Basic Concepts (Cascio, 2003; Gomez-Mejia, Balkin & Cardy, 2012)
 Business processes: “Value adding, value creating activities such
as product development, customer service, & order fulfilment”
 Business process re-engineering: “Fundamental re-thinking &
radical re-design of business processes to achieve dramatic
improvements in cost, quality, service, & speed.”
 Job design: “The process of organizing work into the tasks
required to perform a specific job”
 Job analysis: The process of obtaining information about jobs
 Job description: An overall written summary of task requirements
 Job specification: An overall written summary of worker
requirements
 Work flow: “The way we work is organized to meet the
organization’s production or service goals.”
 Work flow analysis: “Examin[ation of] how work creates or adds
value to the ongoing business processes”
The hiring process (Gomez-Mejia, Balkin & Cardy, 2012)
 Recruitment: Process of generating a pool of
candidates
 Selection: Deciding who from this pool of
candidates would be the best fit and who may
not be suitable
 Recruitment (Cascio, 2003)
 Specifying human resource requirements
(numbers, skills mix, levels, time frame)
 Initial screening: Rapid, rough selection
 Selection process: Interview, tests etc.
 Orientation (in the case of junior management)
 Placement: Assignment of specific job (in the
case of senior management, orientation occurs
after placement)
 Performance appraisal usually leading to
confirmation or termination
 Developing recruitment policies:
Labor market issues (Cascio, 2003)
 Labor market: Geographical area within which the
forces of supply interact with the forces of demand
 Loose labor market: Supply of labor more than
demand
 Factors affecting or defining limits of a labor market:
 Geography
 Education and/ or technical background required to
perform a job
 Industry
 Licensing or certification requirements
Internal vs. external labor markets
(Cascio, 2003)
 External labor markets: labor market outside
the organization, i.e. the jobs are open to
people from within and outside the organization
 Internal labor market: Jobs are open only to
people within the organization
 Sources of recruiting (Gomez-Mejia, Balkin & Cardy, 2012)

 Current employees
 Referrals from current employees
 Former employees
 Former armed forces personnel
 Customers
 Print & radio/ television advertisements
 Advertising through the Internet (Career websites, social media sites,
etc.)
 Employment agencies
 Temporary workers
 College recruiting
 Non-traditional recruiting – prisoners, welfare recipients, senior
citizens, workers from foreign countries, e.g. Sheroes – café in Agra
that recruits only victims of acid attacks
(http://www.livemint.com/Politics/F3tFlPfsE4JjNMtsfE3FGP/Rebuildin
Evaluation hiring (Gomez-Mejia, Balkin & Cardy, 2012)
Hiring workers for a trial period of 90 days, then
deciding whether they should be retained or not
 Benefits:
 Staffing firm handles recruitment & pays salary & benefits
 Company can make a better determination of who will
best fit in an organization than with just an interveiw & test
 Tryout period helps employers avoid making bad hiring
decisions
 Ethical issues:
 Isthe uncertainty about job permanence fair?
 Should the trial period be longer/ shorter?
 Comparison with temporary hiring
 Workforce utilization (Cascio, 2003)
 A way of identifying whether or not the
composition of the workforce – measured by
race and sex – employed in a particular job
category in a particular firm is representative of
the composition of the entire labor market
available to perform that job
The process of recruitment (Cascio, 2003)
 Recruitment pipeline: Time between the receipt
of a résumé and the time a new hire starts work
 Internal recruitment:
 Jobposting
 Employee referrals
 Temporary worker pools: e.g. homeguards
 External recruitment
 Universityrelations
 Executive search firms
 Employment agencies
 Recruitment advertising
Diversity oriented recruitment (Cascio, 2003)

 Gender and cultural diversity essential among:

 Recruiters
 Public faces of the organization
 Advertisements
Managing recruitment operations
(Cascio, 2003)
 Re-engineered recruitment in the information age – Using technology
to screen résumés
 Evaluation and control of recruitment operations
 Cost of operations, i.e., labor costs of company recruitment staff,
operational costs (e.g., recruiting staff’s travel and living
expenses, agency fees, advertising expenses, brochures,
supplies, and postage)
 Cost per hire, by source
 Number and quality of résumés by source
 Acceptance offer/ ration
 Analysis of post-visit and rejection questionnaires
 Salary offered – acceptances versus rejections
 Realistic Job Previews (RJP): Requires that, in addition to telling
applicants about the nice things a job has to offer, recruiters must
also tell applicants about the unpleasant aspects of the job. Benefits
– Improvement in retention rates, more organizational involvement,
more trust in the organization
The other side of recruitment: Job search
(Cascio, 2003)
 Scenario 1: Unemployed
 Scenario 2: Employed but searching for a new
job
Challenges in the hiring process
(Gomez-Mejia, Balkin & Cardy, 2012)

 Turnover costs
 Separation: Exit interview, paperwork processing
 Recruitment: Advertising, recruiter fees
 Selection: Pre-employment testing
 Hiring: Orientation, training
 Productivity: Vacancy cost, disruption
 Determining characteristics important to performance
 Measuring characteristics that determine performance
 Motivation factor
 Who should make the decision?
Staffing
Organizational considerations in
staffing decisions (Cascio, 2003)
 Business strategy:
Developmental Embryonic High growth
• High growth rates • Refining & extending
Mature
• Maintenance of
Aging
• Struggle to hold
Stage of • Basic product lines product lines market share market share
organization • Heavy emphasis on • Building customer loyalty • Cost reduction through • Extreme cost control
product engineering economies of scale • Struggle for
• Minimal customer • Rigid management economic survival
loyalty control over
workers’ actions
• Generation of cash
to develop
new product lines

Entrepreneurs
Bureaucrats who who will cut,
Management are comfortable re-organize,
Selection survive
Entrepreneurs for growth, with repetition, and
Strategy Entrepreneurs but growth directors to can develop
build stable management economies of scale
systems
Organizational considerations in
staffing decisions (Contd.) (Cascio, 2003)
 Organizational culture:
 Transmitted through:
 Formal statements of organizational philosophy and materials
used for recruitment, selection, & socialization of new employees
 Promotion criteria
 Stories, legends, and myths about key people & events
 What leaders pay attention to, measure, and control
 Implicit & possibly unconscious criteria that leaders use to
determine who fits key slots in the organization
 Implications:
 Important consideration for prospective employees
 If consistent with the values, beliefs, and attitudes of employees,
can lead to high productivity and satisfaction among employees
Organizational considerations in
staffing decisions (Contd.) (Cascio, 2003)
 Logic of personnel selection
 Reliability and validity of measurement while
predicting the relative level of job performance
Screening and selection methods (Cascio, 2003)
 Employment application forms:
Should not contain the following:
 Questions that might lead to an adverse impact on
the employment of members of groups protected
under civil rights law
 Questions that cannot be demonstrated to be job
related or that do not concern a bona fide
occupational qualification
 Questions that could possibly constitute an invasion
of privacy
Screening and selection methods (Contd.)
(Cascio, 2003)
 Recommendations and reference checks
 Provide information about:
 Education & employment history
 Character & interpersonal competence
 Ability to perform the job
 Willingness of the past or current employer to re-hire the
applicant
 Meaningful only if the referee
 Has had an adequate opportunity to observe the applicant in
job-related situations
 Is competent to evaluate the applicant’s job performance
 Can express such an evaluation in a way that is meaningful to
the prospective employer, and

Recommendations & reference checks
(Contd.) (Cascio, 2003)
 Guidelines for writing letters of recommendation:
 Indicate degree of familiarity with the candidate in terms of time known and
time observed
 Indicate degree of referee familiarity with the job in question
 Indicate specific examples of performance
 Indicate comparison with other individuals and groups who might be
applying for the position
 Guidelines for seeking information through letters of reference
 Request job-related information only
 Obtain candidate’s written permission to check references prior to doing so
 Stay away from subjective areas like the candidate’s personality
 Evaluate the credibility of the source of the reference material
 Wherever possible, use public records to evaluate on-the-job behavior or
personal conduct
 Stay within the purview of the law governing seeking of personal information
Recommendations & reference checks
(Contd.) (Cascio, 2003)
 Guidelines for providing reference information
 Obtain written consent from the employee prior to providing reference
data
 Do not blacklist former employees
 Keep a written record of all released information
 Make no subjective statements. Provide specific information where
necessary.
 Do not provide any information esp. negative information that cannot be
backed by official records
 If you are contacted by phone, get the phone number and call people
back to give them the information they seek, as far as possible after
checking with the candidate
 Release only the following general types of information: Dates of
employment, job titles and duration, promotions, demotions, attendance
record, salary, & officially cited reason for termination/ employee
Screening and selection methods (Contd.)
(Cascio, 2003)

 Tests and inventories

 Physical tests
 Tests of physical fitness
 Drug testing
 Procedures for testing
 Inform all candidates in writing of the company’s policies
regarding fitness standards and drug use
 Include the policy, and the possibility of testing, in all
employment contracts
 Present the program in a medical & safety context
 Check the testing laboratory’s experience, its analytical
methods, & the way it protects the security & identity of each
sample

Screening and selection methods (Contd.)
(Cascio, 2003)

 Controversial selection techniques

 Handwritinganalysis
 Polygraph examinations
 Tests of integrity
 Shrinkage: Industry term for losses due to bookkeeping
errors and employee, customer, and vendor theft
 Types of tests of integrity:
 Overt
 Personality-based
 Tests of mental ability
 Validity generalization: Validity of job descriptors &
predictors: ref: O*Net Content Model
 Screening and selection methods (Contd.)
(Cascio, 2003)
 Measures of personality
 General measures
 Neuroticism
 Faking
 Projective measures: Present an individual with ambiguous stimuli and
allow him/ her to respond in an open-ended fashion
 Measures of leadership ability
 Consideration: Reflects management actions oriented toward developing mutual
trust, respect for subordinate’s ideas, and consideration of their feelings
 Initiating structure: reflects the extent to which an individual defines and
structures his or her role and the roles of his or her subordinates toward
accomplishing tasks
 Personal History Data
 Employment interviews
 Peer assessment:
 Peer nomination
 Peer rating
 Screening and selection methods (Contd.)
(Cascio, 2003)
 Work-sample tests
 Standardized measures of behavior whose primary objective is to assess the
ability to do rather than the ability to know
 Examples
 Leaderless Group Discussion
 In Basket Test
 Business Games
 Assessment centers: process that evaluates a candidate’s potential
based on multiple assessment techniques, standardized measures,
and pooled judgments, that assess the following
 Administrative skills
 Interpersonal skills
 Intellectual ability
 Stability of performance
 Work oriented motivation
 Career orientation
The employment interview (Angell, 2007)
 “An employment interview involves the
interpersonal communication exchange
between a potential employer & a job
applicant.”
 The process:

Depending upon the no. of people interviewing:

 One on one interview
 Panel interview

Depending upon the traits being tested:

 Traditional: Questions & answers
Goals of an employment interview
(Angell, 2007)

 To gather relevant information regarding a specific

topic for subsequent evaluation and use for the
purpose of:
 Assessing a match between the applicant’s
qualifications & the requirements for the position
 Evaluation of the applicant’s personality, attitude,
disposition, team skills, & general ability to fit in with
other employees
 Determining the applicant’s motivation, communication
skills, & dependability
 Orientation of the applicant to the job requirements &
What should one ask in an interview?
(Gomez-Mejia, Balki & Cardy, 2012)

 Open-ended questions:
 Setthe tone for the interview
 Help build rapport between interviewer & interviewee
 Situational questions: “Elicit from candidates how
they would respond to particular work situations.”
 Job knowledge: “Assess whether candidates have
the basic knowledge required to perform the job.”
 Worker requirements questions: “Assess
willingness of candidates to perform under
prevailing job conditions.”
What should one not ask during the
interview? (Gomez-Mejia, Balkin & Cardy, 2012)
 Do not ask applicants if they have children, plan to have
children, or what child-care arrangements they have made
 Do not ask the age of the applicants
 Do not ask whether the candidate has a physical or mental
disability that could interfere with doing the job
 Do not ask for the applicant’s height or weight even on the
job application if this information does not directly pertain to
the work the applicant is required to do
 Do not ask a female candidate for her maiden name
 Never ask any candidate about their marital status or plans
to get married if they are single
Thank You
 Human Resource Management
Orientation &
Performance Appraisal

Aradhna Malik (PhD)

Assistant Professor
VGSoM, IIT Kharagpur
 Sources
Briscoe, D.R., Schuler, R. S. & Claus, L. (2009). International human resource
management: Policies and practices for multinational enterprises. NY:
Routledge.
Cascio, W. F. (2003). Managing human resources: Productivity, quality of work
life, profits. New Delhi: Tata McGraw Hill.
Cleveland, J. N., Murphy, K. R. & Williams, R. E. (1989). Multiple uses of
performance appraisal: Prevalence & correlates. Journal of Applied
Psychology, 74(1), 130-135.
Gilmore, S. & Williams, S. (Eds.) (2009). Human Resources Management (Indian
Edition). New Delhi: Oxford.
Gomez-Mejia, L. R., Balkin, D. B. & Cardy, R. L. (2012). Managing human
resources (7th Ed.). New Delhi: PHI Ltd.
Gray, G. (2002). Performance appraisals don’t work. Industrial Management,
44(2), 15-17.
Modaff, D.P. & DeWine, S. (2002). Organizational Communication: Foundations,
Challenges and Misunderstandings. Los Angeles, CA: Roxbury.
O’Boyle, I. (2013). Training & Management Development Methods, 27(1), 201-
208.
Employee orientation/ Onboarding
(Dessler & Varkkey, 2011)

 Onboarding is a process that “…provides new

employees with the information they need to function”
effectively in an organization.
 Purposes:
 “Make the new employee feel welcome and part of the team
 Make sure the new employee has the basic information to
function effectively
 Help the new employee understand the organization in a
broad sense (Its past, present, culture, and strategies and
vision of the future)
 Start the person on the process of becoming socialized into
the firm’s culture, values, and ways of doing things”
The orientation process (Dessler & Varkkey, 2011)
 The employee handbook
 Informal orientation: Get togethers, outdoor
activities, picnics, etc.
 Orientation technology: Online learning about
organization
Organizational
Socialization
Organizational Socialization: Definitions
(Modaff & DeWine, 2002)

 Van Maanen and Schein (1979): The

process by which an individual acquires
the social knowledge and skills necessary
to assume an organizational role
 Bullis (1993): Process through which
newcomers become organizational
members. Includes newcomer
acculturation, employee attitudes and
behaviors, and the shaping of newcomers’
identities 104
Organizational socialization is the
organization’s attempts to transform an
organizational newcomer into a full-
fledged member by instilling into the
person the organization’s norms, values,
and beliefs as well as the formal and
informal role requirements associated with
the person’s position (Modaff & DeWine,
2002).
105
When new members
join an organization

106
The more experienced (organizational)
members must find ways to insure that the
newcomer does not disrupt the ongoing
activity on the scene, embarrass or cast a
disparaging light on others, or question too
many of the established cultural solutions
worked out previously (Modaff & DeWine,
2002).

107
After the new members are
accepted as part of the
organization, they are able to
(Modaff & DeWine, 2002)

108
 Share organizational secrets
 Separate the presentational rhetoric used
on outsiders to speak of what goes on in
the setting from the operational rhetoric
used by insiders to communicate with one
another as to the matters-at-hand, and
 Understand the unofficial yet recognized
norms associated with the actual work
going on and the moral conduct expected
of people in the particular organizational
segment
109
Socialization Process (Modaff & DeWine, 2002)
 Collective vs. individual socialization process
 Collective socialization involves putting a group of
recruits through a common set of experiences
together.
 Individual socialization occurs when recruits are
brought into the organization in relative isolation
from one another and put through a unique set of
experiences

110
Socialization Process (Contd.) (Modaff & DeWine, 2002)

 Formal vs. informal socialization process

 Formal socialization occurs when newcomers
are segregated, in one form or another, from
regular organizational members
 Informal socialization processes do not
segregate the newcomer in any special way or
distinguish the newcomer’s role specifically but
instead use the informal, laissez-faire
socialization for recruits

111
Socialization Process (Contd.) (Modaff & DeWine, 2002)

 Sequential vs. random socialization

processes
 Sequential socialization is the degree to which
the organization specifies a certain set of steps to
be completed in order to advance to the target
role
 Random socialization occurs when the sequence
of steps leading to the target role is unknown,
ambiguous, or continually changing

112
Socialization Process (Contd.) (Modaff & DeWine, 2002)

 Fixed vs. variable socialization processes:

 When an organization uses fixed socialization, it
provides the newcomer with a precise timetable
for when to expect progression to the target
role.
 Variable socialization processes provide no real
cues to the newcomer as to when to expect
movement to the target role

113
Socialization Process (Contd.) (Modaff & DeWine, 2002)

 Serial vs. disjunctive socialization processes

 Ifan organization uses serial socialization, it
uses an experienced organizational member,
who occupies a similar role to the one the
newcomer will occupy, to help “groom” the
newcomer
 When the organization uses disjunctive
socialization processes, no role models are
available or are provided for the newcomer and
the newcomer is left alone to discover the ins
and outs of the position 114
Socialization Process (Contd.) (Modaff & DeWine, 2002)

 Investiture vs. Divestiture Socialization

Processes
 The investiture socialization tactic affirms the
personal characteristics and identity that the
newcomer brings to the organization – “we like
you the way you are”
 Divestiture socialization, however, seeks to deny
and strip away certain personal characteristics of
a newcomer – “we love you, you are perfect, now
change”
115
To ease a newcomer’s assimilation into
the organization (Modaff & DeWine, 2002) :
 New employees should collect as much
information about the organization as
possible
 Managers need to take special note of the
progress new employees are making in the
first few days and weeks toward adopting the
values of the organization

116
To ease a newcomer’s assimilation into
the organization (Contd.) (Modaff & DeWine, 2002) :
 As a new employee, you must assess how
much of your own culture you are being asked
to set aside in order to adopt the culture of the
organization
 Managers need to consider each new
employee and determine what approach will
work best, remembering that the organization
must make some adaptations to its new
members as well as expecting adjustments
from them 117
 Managing
Performance
Definitions of performance management
(Hall, in Gilmore & Williams, 2009)
 ‘Managing the business’ (Mohrman & Mohrman, 1995, in Hall, 2009)
Effective management is managing performance and is the responsibility of
all managers.
 Term first used in the 1970s by Beer and Ruh (1976, in Hall, 2009): Emphasizes
the experiential (doing and learning) aspects of performance management,
and highlights the importance of feedback as a management activity in this
process.
 First formal definition by Chartered Institute of Personnel and Development,
UK, 1992: ‘Strategy which relates to every activity of the organization set in
the context of its human resource policies, culture, style and communication
systems.. The nature of the strategy depends on the organizational context
& can vary from organization to organization.
 Armstrong & Baron (2005): ‘Process which contributes to the effective
management of individuals and teams in order to achieve high levels of
organizational performance. As such, it establishes shared understanding
about what is to be achieved and an approach to leading and developing
people which will ensure that it is achieved.’
HRM & Managing Performance
(Hall, in Gilmore & Williams, 2009)

 Early HRM Models:

 HRM Model proposed by Fomburn, Tichy & Devanna (1984):
Described selection, appraisal, and development – influencing
performance within the human resource cycle. This early model
assumed that managing these HR activities could influence employee
performance, but it did not offer any explanation of the processes
involved.
 Harvard model of HRM: Recognizes how stakeholder interests inform
certain areas of HRM policy formulation, and how the implementation
of these policies produces outcomes that have long term
consequences, including organizational effectiveness.
 Guest’s theory of HRM: With its four HR policy goals of strategic
integration, commitment, flexibility, and quality, describes how HR
policy implementation can lead to certain organizational outcomes,
including job performance and other outcomes, that can affect
HRM & Managing Performance (Contd.)
(Hall, in Gilmore & Williams, 2009)
 Strategic HRM (Boxall & Purcell, 2003): Strategic HRM is about how HRM
influences organizational performance. Stratefic HRM ‘positions’ the
strategic responsibility for managing performance within HRM, which has
influenced the development of the rold of HR managers and helped to
define the nature of their interaction with other managers.
 The business partner model of HRM (Ulrich, 1997): Conceptual
framework that describes how HRM operates as a business partner within
organizations. Areas where HRM can ‘partner’ the business in contributing
towards achieving the organizational aims: Strategic partner, human
capital developers (strategic), functional expert, employee advocates
(operational), and HR leader at the centre spanning all areas. Model
describes how HR managers can work in partnership with other managers
to develop and implement coherent and integrated performance
strategies, based on HR policies and practices, to achieve common
business goals.
 People & performance model (Boxall & Purcell, 2003): Performance is a
Whose responsibility is the management of
performance? (Hall, in Gilmore & Williams, 2009)
 Performance related work practices
(Purcell, 2003, in Hall, 2009)
 Careful/ sophisticated recruitment and selection
 Job security
 Emphasis on providing career opportunities
 Appraising each individual’s performance and development
 Training and learning/ development
 Pay satisfaction
 Work life balance
 Job challenge/ job autonomy
 Teamworking
 Involvement in decision-making

Performance management in practice
(Hall, in Gilmore and Williams, 2009)

 Performance management system: Organizational framework or

model that supports the integration and implementation of
processes to facilitate the strategic management of performance
 Armstrong & Baron (2005): Characteristics of an organization that
indicate the existence of a performance management system:
 It (the organization) communicates a vision of its objectives to all
employees
 It sets departmental and individual performance targets that are related
to wider organizational objectives
 It conducts a formal review of progress towards these targets
 It uses the review process to identify training, development, and reward
outcomes
 It evaluates the whole process in order to improve effectiveness
 It uses formal appraisal procedures as a way of communicating
performance requirements that are set on a regular basis
Performance Appraisal
What? (Hall, in Gilmore & Williams, 2009)
 Background
 Came into prominence in 1960s with the introduction of
MBO
 Gained substantial popularity in 1990s
 An exercise undertaken by organizations typically
annually to map actual performance with goals
decided previously (Cascio, 2003)
 Psychological principles of Performance Appraisal
(Kersley et al, 2006, in Hall, 2009):
 Adequate feedback as to how they are performing
(knowledge of their output)
 Clear attainable objectives
 Why? (Cleveland, Murphy & Williams, 1989)
 Salary administration
 Promotion
 Retention or termination
 Recognition of individual performance
 Layoffs
 Identify poor performance
 Identify individual training needs
 Performance feedback
 Determine transfers and assignments
 Identify individual strengths and weaknesses
 Personnel planning
 Determine organizational training needs
 Evaluate goal achievement
 Assist in goal identification
 Evaluate personnel systems
 Reinforce authority structure
 Identify organizational development needs
 Criteria for validation research
 Document personnel decisions
 Meet legal requirements
Aims of appraisal (Hall, in Gilmore & Williams, 2009)
 Communication
 To provide an opportunity for open two – way dialogue (feedback) about all
aspects of individual performance
 To discuss & clarify expectations, roles, aspirations, & any issues affecting
performance
 To focus on how the individual with the support of the organization contributes to
the aims of the business
 Development
 To identify opportunities for professional development linked to the employee’s
role and career aspirations
 To provide training, learning, and development opportunities to enable employees
to contribute to the performance of their organization and to enhance their career
opportunities
 To develop individuals in line with organizational succession planning
 Motivation
 To influence motivation positively by providing feedback, recognition & praise
 To identify and provide opportunities for development, including appropriate
learning & training
 To empower people by encouraging them to commit & take responsibility for
tasks and objectives, and to feel that they have the personal and organizational
resources to achieve their objectives
Identifying performance dimensions
(Gomez-Mejia, Balkin & Cardy, 2012)

 Employer perspective:
 Despite imperfect measurement techniques, individual differences
in performance can make a difference to company performance
 Documentation of performance appraisal and feedback may be
needed for legal defense
 Appraisal provides a rational basis for constructing a bonus or
merit system
 Appraisal dimensions & standards can help to implement
strategic goals & clarify performance expectations
 Providing individual feedback is part of the performance
management process
 Despite the traditional focus on the individual, appraisal criteria
can include teamwork & the teams can be the focus of the
appraisal
Identifying performance dimensions
(Contd.) (Gomez-Mejia, Balkin & Cardy, 2012)
 Employee perspective:
 Feedback is needed & desired
 Improvement in performance requires assessment
 Fairness requires that differences in performance
levels across workers be measured & have an
effect on outcomes
 Assessment & recognition of performance levels
can motivate workers to improve their performance
Defining employee’s goals & efforts
(Dessler, 2005)

 Assign specific goals

 Assign measurable goals
 Assign challenging but doable goals
 Encourage participation
Assessment of objectives (Hall, in Gilmore & Williams, 2009)
 S: Specific, significant, stretching

 M: Measurable, meaningful, motivational

 A: Attainable, agreed upon, achievable,

acceptable, action oriented

 R: Realistic, relevant, reasonable, rewarding,

results oriented
Concerns regarding performance appraisals
(Gray, 2002)

 They may not be synchronized with the

developing structure of global businesses
 They may not motivate
 “No one is average”
 The timing may impact the appraisal, e.g.
before vs. after holiday season
Values, attitudes, and behavior
(Hall, in Gilmore & Williams, 2009)

 Assessed in terms of outcomes – based on

competencies demonstrated in achieving the
outputs
 Outcomes linked with learning, development, &
Experience are desirable because they are
necessary for personal development & performance
improvement
 Appraisal through generation of examples by
examples that demonstrate how their VAB
contributed towards performance. e.g. 360 degree
feedback, mapping of VAB against core values of
 Traditional performance appraisals vs. 360 deg
feedback (O’Boyle, 2013)
Criteria Traditional Performance Appraisals 360 Deg Feedback
Why? To provide an evaluation on past To provide an evaluation & feedback
performances from a single source on behavior & development needs
from multiple sources
Raters Line manager Peers, subordinates, self, line
manager, external people & groups
Feedback Line manager cannot have Multiple sources of feedback are able
anonymity to remain anonymous
Assessment Quantitative & qualitative Generally only quantitative
Outcomes Salary, promotion, transfer, Strong focus on training &
demotion, training & development development in order to improve
future performance. May also be
linked to compensation
Frequency Annual Continuous
Applicability All employees All employees
Typical employee reactions to
performance appraisals (Cascio, 2003)
 Employees are often less certain about where they
stand after the appraisal interview than before it
 Employees tend to evaluate their supervisors less
favorably after the interview than before it.
 Employees often report that few constructive actions or
significant improvements resulted from appraisal
interviews
 Employees feel that the authoritarian “tell & sell”
approach, so common in appraisal interviews, is
completely out of step with today’s emphases on
empowerment and workplace democracy
Appraising performance
(Cascio, 2003, Dessler, 2005)

Steps:
 Defining the job and performance and setting achievable goals
 Facilitating performance
 Encouraging performance
 Voice of employees
 Consistency of treatment of employees
 Relevance of rewards
 Communication about rewards process
 Appraising performance
 Feedback to the employee regarding appraisal and directions
for the future
Challenges:
 What to measure
 How to measure
Purposes of performance appraisal
systems (Cascio, 2003)
 Appraisals provide legal and formal
organizational justification for employment
decisions
 Appraisals are used as criteria in test validation
 Appraisals provide feedback to employees
 Appraisals can help establish objectives for
training programs
 Appraisals can help diagnose organizational
problems
Requirements of effective appraisal
systems (Cascio, 2009)
 Relevance:
 Clear links between the performance standards for a particular job
and an organization’s goals
 Clear links between the critical job elements identified through a job
analysis and the dimensions to be rated on an appraisal form
 Performance standards: Translation of job requirements into
levels of acceptable or unacceptable
 Sensitivity: Capability of a performance appraisal system to
distinguish effective from ineffective performers
 Reliability: Consistency of judgment
 Acceptability by employees
 Practicality: Ease of understandability and use of appraisal
Thank You
 Human Resource Management

Managing Performance
Aradhna Malik (PhD)
Assistant Professor
VGSoM, IIT Kharagpur
 Sources
Briscoe, D.R., Schuler, R. S. & Claus, L. (2009). International human resource
management: Policies and practices for multinational enterprises. NY:
Routledge.
Cascio, W. F. (2003). Managing human resources: Productivity, quality of work
life, profits. New Delhi: Tata McGraw Hill.
Cleveland, J. N., Murphy, K. R. & Williams, R. E. (1989). Multiple uses of
performance appraisal: Prevalence & correlates. Journal of Applied
Psychology, 74(1), 130-135.
Dessler, G. (2005). Human resources management (10th Ed.). New Delhi:
Pearson.
Dessler, G. & Varkkey, B. (2011). Human Resource Management (10th Ed.). New
Delhi: Pearson.
Gilmore, S. & Williams, S. (Eds.) (2009). Human Resources Management (Indian
Edition). New Delhi: Oxford.
Gomez-Mejia, L. R., Balkin, D. B. & Cardy, R. L. (2012). Managing human
resources (7th Ed.). New Delhi: PHI Ltd.
Gray, G. (2002). Performance appraisals don’t work. Industrial Management,
44(2), 15-17.
Modaff, D.P. & DeWine, S. (2002). Organizational Communication: Foundations,
 Managing
Performance
Definitions of performance management
(Hall, in Gilmore & Williams, 2009)
 ‘Managing the business’ (Mohrman & Mohrman, 1995, in Hall, 2009)
Effective management is managing performance and is the responsibility of
all managers.
 Term first used in the 1970s by Beer and Ruh (1976, in Hall, 2009): Emphasizes
the experiential (doing and learning) aspects of performance management,
and highlights the importance of feedback as a management activity in this
process.
 First formal definition by Chartered Institute of Personnel and Development,
UK, 1992: ‘Strategy which relates to every activity of the organization set in
the context of its human resource policies, culture, style and communication
systems.. The nature of the strategy depends on the organizational context
& can vary from organization to organization.
 Armstrong & Baron (2005): ‘Process which contributes to the effective
management of individuals and teams in order to achieve high levels of
organizational performance. As such, it establishes shared understanding
about what is to be achieved and an approach to leading and developing
people which will ensure that it is achieved.’
Performance management in practice
(Hall, in Gilmore and Williams, 2009)

 Performance management system: Organizational framework or

model that supports the integration and implementation of
processes to facilitate the strategic management of performance
 Armstrong & Baron (2005): Characteristics of an organization that
indicate the existence of a performance management system:
 It (the organization) communicates a vision of its objectives to all
employees
 It sets departmental and individual performance targets that are related
to wider organizational objectives
 It conducts a formal review of progress towards these targets
 It uses the review process to identify training, development, and reward
outcomes
 It evaluates the whole process in order to improve effectiveness
 It uses formal appraisal procedures as a way of communicating
performance requirements that are set on a regular basis
Performance Appraisal
Aims of appraisal (Hall, in Gilmore & Williams, 2009)
 Communication
 To provide an opportunity for open two – way dialogue (feedback) about all
aspects of individual performance
 To discuss & clarify expectations, roles, aspirations, & any issues affecting
performance
 To focus on how the individual with the support of the organization contributes to
the aims of the business
 Development
 To identify opportunities for professional development linked to the employee’s
role and career aspirations
 To provide training, learning, and development opportunities to enable employees
to contribute to the performance of their organization and to enhance their career
opportunities
 To develop individuals in line with organizational succession planning
 Motivation
 To influence motivation positively by providing feedback, recognition & praise
 To identify and provide opportunities for development, including appropriate
learning & training
 To empower people by encouraging them to commit & take responsibility for
tasks and objectives, and to feel that they have the personal and organizational
resources to achieve their objectives
Identifying performance dimensions
(Gomez-Mejia, Balkin & Cardy, 2012)

 Employer perspective:
 Despite imperfect measurement techniques, individual differences
in performance can make a difference to company performance
 Documentation of performance appraisal and feedback may be
needed for legal defense
 Appraisal provides a rational basis for constructing a bonus or
merit system
 Appraisal dimensions & standards can help to implement
strategic goals & clarify performance expectations
 Providing individual feedback is part of the performance
management process
 Despite the traditional focus on the individual, appraisal criteria
can include teamwork & the teams can be the focus of the
appraisal
Identifying performance dimensions
(Contd.) (Gomez-Mejia, Balkin & Cardy, 2012)
 Employee perspective:
 Feedback is needed & desired
 Improvement in performance requires assessment
 Fairness requires that differences in performance
levels across workers be measured & have an
effect on outcomes
 Assessment & recognition of performance levels
can motivate workers to improve their performance
Defining employee’s goals & efforts
(Dessler, 2005)

 Assign specific goals

 Assign measurable goals
 Assign challenging but doable goals
 Encourage participation
Assessment of objectives (Hall, in Gilmore & Williams, 2009)
 S: Specific, significant, stretching

 M: Measurable, meaningful, motivational

 A: Attainable, agreed upon, achievable,

acceptable, action oriented

 R: Realistic, relevant, reasonable, rewarding,

results oriented
Appraising performance
(Cascio, 2003, Dessler, 2005)

Steps:
 Defining the job and performance and setting achievable goals
 Facilitating performance
 Encouraging performance
 Voice of employees
 Consistency of treatment of employees
 Relevance of rewards
 Communication about rewards process
 Appraising performance
 Feedback to the employee regarding appraisal and directions
for the future
Challenges:
 What to measure
 How to measure
Requirements of effective appraisal
systems (Cascio, 2009)
 Relevance:
 Clear links between the performance standards for a particular job
and an organization’s goals
 Clear links between the critical job elements identified through a job
analysis and the dimensions to be rated on an appraisal form
 Performance standards: Translation of job requirements into
levels of acceptable or unacceptable
 Sensitivity: Capability of a performance appraisal system to
distinguish effective from ineffective performers
 Reliability: Consistency of judgment
 Acceptability by employees
 Practicality: Ease of understandability and use of appraisal
 Designing and operating
performance management
systems
Performance measurement
(Hall, in Gilmore & Williams, 2009)
 Results oriented: ‘Outputs’ approach using metrics, e.g.
 Financial – Sales turnover per employee, pre-tax profit per employee,
return on investments etc.
 People – Value added per employee, total leavers/ total employees
(%), early leavers/ total employees (%), days lost to absenteeism per
employee, etc.
 Customer – Complaints per customer (%), orders not delivered on time
(%), satisfied customers (%), marketing expenditure/ turnover (%), etc.
 Innovation, learning, and development – R&D expenditure/ turnover
(%), training expenditure/ turnover (%), training expenditure per
employee, etc.
 Grading methods or ranking methods – pseudo-quantitative –
used for assessing attitude and behavioral aspects of
performance, where ranking or rating methods such as
behaviorally anchored rating scales (BARS) are commonly
Graphic Rating Scale Method (Dessler, 2005)
 Lists traits (such as quality & reliability) and a range of
performance values (from unsatisfactory to
outstanding) for each trait
 Supervisor rates each subordinate by circling or
checking the score that best describes his or her
performance for each trait. Assigned values are then
totalled
 What can be measured?
 Generic dimensions such as quality & quantity
 Job’s actual duties, e.g. maintenance of records
 Competency based appraisals – focus on the employees
ability to exhibit the competencies that the employer values
Alternation ranking method (Dessler, 2005)
 Ranks employees from best to worst on a trait or
group of traits
 List all subordinates to be rated
 Cross out names of any not known well enough
to rank
 Indicate the employee who is highest on the
characteristic being measured and also the one
who is lowest
 Choose the next highest and next lowest, and
alternate between highest and lowest until all
Other methods (Dessler, 2005)
 Paired comparison method: For every trait (quality of work, quantity
of work, etc.) every employee is paired and compared with every
other
 Forced distribution method: Similar to grading on a curve. Place
predetermined percentages of ratees into performance categories
e.g. 15% high performers, 20% high average performers, 30%
average performers, 20% low average performers, 15% low
performers
 Problems:
 Possibility of bias
 High possibility of intra-office politics affecting ratings
 Critical incident method: Supervisor keeps a log of positive and
negative examples (critical incidents) of a subordinate’s work related
behavior. Every six months or so, supervisor and subordinate meet
to discuss the latter’s performance, using the incidents as examples
 Narrative forms: Final written appraisal
Behaviorally Anchored Rating Scales
(BARS) (Dessler, 2005)
 Generate critical incidents
 Develop performance dimensions
 Reallocate incidents
 Scale the incidents
 Develop a final instrument
 Advantages:
 A more accurate gauge
 Clearer standards
 Feedback
 Independent dimensions
Management by Objectives (Hall, in Gilmore & Williams, 2009)
 Introduced by Peter Drucker in 1955
 First systematic approach that attempted to align organizational goals with individual
performance and development, involving all levels of management.
 Key principles:
 The setting of objectives (goals) & targets
 The participation of managers in agreeing to objectives & performance criteria
 The continual review & appraisal of results
 Processes:
 Clarification of organizational goals & objectives
 Design of organizational structures & systems to achieve goals & objectives
 Participation of managers to gain acceptance & agreement on objectives,
targets, & performance criteria of employees at organizational, group, &
individual level
 Agreement to performance improvement plans to enable employees to contribute
to achieving individual objectives & targets, & to improving organizational
performance
 Monitoring & reviewing employee progress & performance against agreed
objectives through the use of an appraisal process
 Making changes to employees’ objectives & targets as a consequence of review
 Review of organizational performance based on outcomes of the MBO cycle of
activities
 Benefits of MBO (Hall, in Gilmore & Williams, 2009)

 It communicates organizational aims to employees

 It defines work activities based on the aims of the
organization
 It enables employees to contribute towards the
aims of the organization by working towards their
individual goals
 It provides a process for employee and
organizational improvement
 It facilitates continuous and systematic
management of performance throughout the
organization
Balanced Scorecard (Hall, in Gilmore & Williams, 2009)
 Kaplan and Norton (1996): Performance measurement system to
Performance management system
 Perspectives to managing performance:
 Customer: Customer value proposition
 Business processes (operational): The internal processes & systems
 Innovation & learning (people): The human contribution through
knowledge & skills
 Goals: Strategic goals at the top level of an organization and then
‘translated’ into appropriate goals at lower levels such as business units,
teams, & individuals
 Process of translating and ‘cascading’ strategic aims into goals at every
level throughout an organization guides and encourages people to
contribute towards the overall performance of the organization
 Strategic mapping: Definition of strategic aims and relation of these aims to
organizational activities to serve as a basis for specifying goals within the
different performance perspectives
Balanced Scorecard (Hall, in Gilmore & Williams, 2009)
Financial
perspective
How we
satisfy our
shareholders

Customer
Operational perspective
perspective
How our
Vision and customers
How we excel strategy
at what we do view us

People
perspective
How our
employees
contribute
Example of a Balanced Scorecard
(Hall, in Gilmore & Williams, 2009)

Goal Measure or Objective/ target Development

(Broad objective) ‘metric’ actions
Achieve ‘excellent’ % of customers Less than 10% loss Develop ‘lost
customer lost over 12 of customers in 6 customers’ report
satisfaction months months time

% of customers More than 80% of Use customer

completed a CS customers feedback to
survey in past 6 complete a CS improve CS survey
months survey this year
Level of CS More than 75% of Develop employee
customers to rate competencies in
our service as CS
‘excellent’
Quartile for CS Upper quartile in Develop
compared to sector industry sector by benchmarking
end of financial within sector
year
Criticisms of Balanced Scorecard
(Hall, in Gilmore & Williams, 2009)

 Issues related to its interpretation and

implementation
 Issues related to time/ level of implementation
 Individual
 Reporting tool
 Distraction from business activities
 Lack of ownership and accountability
 Difficult to establish ‘cause & effect’
European Foundation for Quality Management
(EFQM) Excellence Model (Hall, in Gilmore & Williams, 2009)
 Introduced in 1992 (efqm.com)
 Based on:
 Enablers:
 Leadership
 People
 Strategy & policy
 Partnership & resources
 Processes
 Results:
 People
 Customers
 Society
 Key performance indicators
 Criticisms:
 Relies on self – assessment
 Heritage in quality management – developed as auditing frameworks with a
focus on compliance with existing standards, rather than managing performance
Advantages & disadvantages of appraisal tools
(Dessler, 2005, Hall, in Gilmore & Williams, 2009)
Tool Advantages Disadvantages
Graphic rating Simple to use, provides a Standards may be unclear, halo
scale quantitative rating for each effect, central tendency, leniency,
employee bias can be problems
BARS Provides behavioral ‘anchors’. Difficult to develop
Accuracy
Alternation Simple to use. Avoids central Can cause disagreements among
ranking tendency and other such probs employees & may be unfair if all
employees are excellent
Forced Predetermination of percentage of Results depend on supervisor’s
distribution people in each group choice of cut off points
Critical incident Helps specify what is ‘right’ and Difficult to rate or rank employees
method ‘wrong’. Ongoing evaluation. relative to each other
MBO Tied to jointly agreed upon Time consuming
performance objectives
EFQM
 Feedback on performance
(Hall, in Gilmore & Williams, 2009)

 Purpose: To provide an opportunity for

communication between managers and
employees that specifically addresses
performance issues.
 Methods:
 Top down feedback & upward feedback –
unidirectional and hence flawed
 360 degree is best: feedback from suppliers,
customers, peers, subordinates, supervisors
 Self appraisal
Managing poor performance
(Hall, in Gilmore & Williams, 2009)
Employee fails to perform effectively

Investigation of reason for poor performance

Address shortcomings – actions may include:

• Clarify role
Alternative courses of action • Set objectives
• Address issues via • Establish monitoring meetings
Performance review
• Consider alternative
employment Record issues discussed and action taken

If still no improvement

Procedures within disciplinary policy will apply

Effectiveness of performance appraisals
(Hall, in Gilmore & Williams, 2009)

 Concerns regarding
 Unintended consequences because of inappropriate (and
undesirable) employee behavior in attempting to achieve objectives
 Past reasons for current behavior
 Duration between appraisals – annual/ semi – annual, quarterly –
what is too soon?
 Feedback vs. Real encouragement and support for good
performance
 Potential rating scale appraisal problems (Dessler, 2005):
 Unclear standards
 Halo effect: Influence of the rater’s general impression about ratee
 Central tendency: Tendency of supervisors to rate all subordinates in
the middle of the rating scale
 Leniency or strictness
Appraising performance (Dessler, 2005)
 Make sure you know what you mean by ‘successful performance’.
Conduct job analysis to establish the criteria and standards
 Incorporate these criteria and standards into a rating instrument (BARS,
graphic rating scale, etc.
 Communicate performance standards to employees and to those rating
them, in writing
 When using graphic rating scales, avoid abstract trait names such as
‘loyalty’ or ‘honesty’ unless you can define them in terms of observable
behaviors
 Use subjective supervisory ratings (e.g. essays) as only one component
of the overall appraisal process
 Train supervisors to use the rating instrument properly. Give instructions
on how to apply performance appraisal standards when making
judgments & provide written instructions for using the rating scales.
 Allow appraisers substantial daily contact with the employees they are
evaluating
Appraising performance (Contd.) (Dessler, 2005)

 Base your appraisals on separate ratings for each dimension of

the job performance instead of using a single overall rating of job
performance
 Whenever possible, have more than one appraiser conduct the
appraisal, and conduct all such appraisals independently
 One appraiser should never have absolute authority to determine
a personnel action
 Employees should have the opportunity to review and make
comments, written or virtual about their appraisals before they
become final, and should have a formal appeals process through
which to appeal their ratings
 Document all information and reasons bearing on any personal
decision
 Where appropriate, provide corrective guidance to assist poor
Appraisal interviews (Dessler, 2005)
 Discussion after the appraisal between
supervisor and subordinate to review the
appraisal and make plans to remedy
deficiencies and reinforce strengths
 Types of appraisal interviews:
 Satisfactory - Promotable
 Satisfactory - Not promotable
 Unsatisfactory but correctable
 Unsatisfactory and uncorrectable
 How to conduct the appraisal interview
(Dessler, 2005)
 Conducting the interview
 Talk in terms of objective work data
 Don’t get personal
 Encourage the person to talk
 Don’t tiptoe around
 How to handle a defensive subordinate:
 Recognize that defensive behavior is normal
 Never attack a person’s defenses and try to explain someone to themselves, e.g.
statements like, “You know the real reason you are using that excuse is that you
cannot bear to be blamed for anything”
 Postpone action
 Recognize your own limitations
 How to criticize a subordinate: Praise in public, punish in private
 How to ensure that the interview leads to performance
 Ensure that the subordinate does not feel threatened during the interview
 Ensure that the subordinate has the opportunity to present his/her ideas and
feelings and has a chance to influence the course of the interview
Effective performance feedback interviews
(Cascio, 2003)

 Before the interview:

Communicate frequently
Get training in performance appraisal
interviewing
Plan to use a problem solving approach
rather than “tell and sell”
Encourage subordinates to prepare for
performance feedback interviews
 Effective performance feedback interviews (Contd)
(Cascio, 2003)
 During the appraisal interview:
 Encourage subordinates to participate
 Judge performance, not personality and mannerisms
 Be specific
 Be an active listener:
 Take the time to listen – hold all phone calls and do not allow interruptions
 Communicate verbally and non-verbally that you genuinely want to help
 As the subordinate begins to tell his or her side of the story, do not interrupt

and do not argue

 Watch for verbal as well as nonverbal cues regarding the subordinate’s

agreement or disagreement with your message

 Summarize what was said and what was agreed to
 Avoid destructive criticism because:
 It produces negative feelings among recipients and can initiate or intensify

conflict
 It reduces the preference of individuals for handling future disagreements

with the giver of the feedback in a conciliatory manner (e.g. collaboration and
compromise)
 It has negative effects on self-set goals and on feelings of self confidence
 Set mutually agreeable goals for future improvements
Effective performance feedback
interviews (Contd) (Cascio, 2003)
 After the appraisal interview
 Communicate frequently about performance and
assess progress towards goals regularly because:
 It helps keep behavior on target
 It provides a better understanding of the reasons behind a

given level of performance

 It enhances the subordinate’s commitment to perform

effectively
 Make organizational rewards contingent on
performance
Contemporary issues in managing
performance (Hall, in Gilmore & Williams, 2009)
 Human capital management: Management of
measurable contribution by the people in the
organization
 Governance: Combination of conformance or
compliance and performance
 Future of managing performance
 Increasing importance due to increasing competition
 Effective reporting and management of performance
 Need for uniformity in reporting of performance
 Need for conformity of reporting of performance
Thank You
 Human Resource Management
Assessment of Training Needs
&
Training Methods
Aradhna Malik (PhD)
Assistant Professor
VGSOM, IIT Kharagpur
 Sources
Briscoe, D.R., Schuler, R. S. & Claus, L. (2009). International human resource
management: Policies and practices for multinational enterprises. NY:
Routledge.
Cascio, W. F. (2003). Managing human resources: Productivity, quality of work
life, profits. New Delhi: Tata McGraw Hill.
Cleveland, J. N., Murphy, K. R. & Williams, R. E. (1989). Multiple uses of
performance appraisal: Prevalence & correlates. Journal of Applied
Psychology, 74(1), 130-135.
Dessler, G. (2005). Human resources management (10th Ed.). New Delhi:
Pearson.
Dessler, G. & Varkkey, B. (2011). Human Resource Management (10th Ed.). New
Delhi: Pearson.
Gilmore, S. & Williams, S. (Eds.) (2009). Human Resources Management (Indian
Edition). New Delhi: Oxford.
Gomez-Mejia, L. R., Balkin, D. B. & Cardy, R. L. (2012). Managing human
resources (7th Ed.). New Delhi: PHI Ltd.
Gray, G. (2002). Performance appraisals don’t work. Industrial Management,
44(2), 15-17.
Modaff, D.P. & DeWine, S. (2002). Organizational Communication: Foundations,
 Training &
Development
The Training Process (Dessler & Varkkey, 2011)
 Definition: “Training means giving new or
current employees the skills they need to
perform their jobs.”
 Negligent training: Insufficient training or
training not suited for the job the employee may
be assigned
 Aligning strategy and training = learning needs
+ individual needs of employees +
organizational needs + appropriate training +
individual performance aligned with
Employee Training (Cascio, 2003)
 Training consists of planned programs
designed to improve performance at the
individual, group, and/or organizational
levels.
 Improved performance implies that there
have been measurable changes in
knowledge, skills, attitudes, and/or social
behavior
Key issues in training (Gomez-Mejia, Balkin & Cardy, 2012)
 How can training keep pace with a changing
organizational environment?
 Should training take place in a classroom
setting or on the job?
 How can training be effectively delivered
worldwide?
 How can training be delivered so that trainees
are motivated to learn?
Challenges in training (Gomez-Mejia, Balkin & Cardy, 2012)
 Is training the solution to the problem?
 Are the goals of training clear and realistic?
 Is training a good investment?
 Look inside & find trainers from within the
organization
 Focus training on what is needed
 Give training a strategic alignment
 Capitalize on reduced costs of online training
(IMA, 2002, Baun & Scott, 2010, and Engebreston, 2010, in Gomez-Mejia, Balkin &
Cardy, 2012)

 Will the training work?

Making the learning meaningful
(Dessler & Varkkey, 2011)

 Overview at the beginning of training to help

trainees assess the value of training program
 Inclusion of a “… variety of familiar examples”
 Logical organization of information
 Use of familiar terms & concepts to sustain the
interest of trainees and to give them a feeling of
success during and after training
 Use of visual aids
 Creation and sustenance of training need
Making skills transfer easy (Dessler & Varkkey, 2011)
 “Maximize similarity between training situation & work situation
 Provide adequate practice
 Label of identify each feature of the machine and / or step in
the process
 Direct the trainees’ attention to important aspects of the job
 Provide “heads-up” (advance) information regarding potential
stressful conditions”
 Allow and facilitate trainees to learn at their own pace
 Reinforce learning by encouraging correct responses and
correcting the incorrect ones immediately after occurrence.
 Be sensitive to the impact the time of the day/duration of
program/ office activities and culture, etc. can have on the
learning curve.
 Training Trends (Cascio, 2003)
 Challenges
 Social pressures
 Pressure to perform in highly specialized
environments
 Maintenance of quality in the face of ever
increasing awareness and subsequent
expectations of customers
 Management of interpersonal expectations in
intercultural environments
 Off-shoring and management in a multi-
Continent environment
Structural issues in the delivery of training
(Cascio, 2003)
 Corporate commitment is lacking and uneven
 Aggregate expenditures by business on training are
inadequate
 Businesses complain that schools award degrees but they
are no guarantee that graduates have mastered skills
 Poaching trained workers is a major problem for
businesses, and provides a strong disincentive for training
 Despite the rhetoric about training being viewed as an
investment, current accounting rules require that it be
treated as an expense
 Lack of adequate support from Govt agencies
 Lack of coordination between what employers need and
what schools teach their students
 Organized labor
Characteristics of effective training practice
(Cascio, 2003)
 Commitment of top management to training and
development
 Dependence of business strategy on training/
coherence between training and business
strategy and results
 Comprehensive, systematic and continuous
approach to training
 Commitment to invest the resources necessary
to provide adequate and timely training
Training paradox (Cascio, 2003)
 Increasing an individual’s employability
outside the company simultaneously
increases his or her job security and
desire to stay with the current employer
Designing training programs (Dessler & Varkkey, 2011)
 Needs analysis: “… identify the specific knowledge &
skills the job requires & compare these with the
prospective trainees’ knowledge & skills
 Instructional design: “… formulate specific, measurable
knowledge & performance training objectives, review
possible training program content (including workbooks,
exercises, and activities), and estimate a budget for the
training program
 Implementation: “… by actually training the targeted
employee group using methods such as on the job or
online training”
 Evaluation: “… assess the program’s success or
failures”
Designing training programs (Contd.)
(Cascio, 2003)

 Assessment phase
 Organizationanalysis
 Operations analysis:
 Systematic collection of information that describes how
work is done
 Determination of standards of performance

 Determination of how tasks are to be performed to meet

the standards
 Determination of the competencies necessary for

effective task performance

 Individualanalysis
 Derivation of Objectives
Designing training programs (Contd.)
(Cascio, 2003)

 Training and development phase

 Selectionof media and learning principles
 Evaluation of transfer of skills
 Evaluation phase
 Develop criteria
 Pretest trainees
 Monitor training
 Evaluate training
 Evaluate transfer of training
 Feedback
 Needs analysis (Gomez-Mejia, Balkin & Cardy, 2012)
 Levels:
 Organizational analysis: “…examines broad factors
such as the organization’s culture, mission, business
climate, long and short term goals, & structure.
Purpose is to identify both overall organizational needs
& the level of support for training.”
 Task analysis: Examination of the job to be performed
 Person analysis: “Determines which employees need
training by examining how well employees are carrying
out the tasks that make up their jobs. Often necessary
when there is a discrepancy between a worker’s
performance & the organization’s expectations or
standards.”
Performance analysis: Assessing current
employees training needs (Dessler & Varkkey, 2011)
 The process of verifying that there is a performance deficiency
and determining whether the employer should correct such
deficiencies through training or some other means (like
transferring the employee).
 Tools of performance analysis:
 Performance appraisals
 Job related performance data
 Observations by supervisors or other specialists
 Interviews with the employee of his/ her supervisor
 Tests of things like job knowledge, skills, and attendance
 Attitude surveys
 Individual employee daily diaries
 Assessment center results

Needs analysis (Contd.) (Dessler & Varkkey, 2011)
 Task analysis: detailed study of the job to determine what specific skills
the job requires.

Task analysis record form: Form that consolidates information regarding

required tasks and skills in a form that is especially helpful for determining
training requirements. May include parameters like when and how often
specific tasks are performed, quantity and quality of performance,
conditions under which specific tasks are performed, skills or knowledge
required, and where (or during which activity) tasks are best learnt in the
organization.
Differentiate between job description, job specifications and task analysis

 Competency model: Consolidates usually in one diagram, a precise

overview of the competencies someone would need to do a job well, with
foundation competencies (Personal, interpersonal, job related) at the
base, followed by areas of expertise, and roles at the top of the
pyramidical model.
Training needs assessment model (Cascio, 2003)
Environment Training Cycle
• Unions
• Economy
• Laws Yes Individual
Yes
Analysis
Operations • Knowledge
Organization analysis Training Training
Analysis • Skills
• Objectives need? need?
• Requirements • Attitudes
• Resources
for efficiency
• Allocation of resources
Current Optimal
No Level of Level of
No performancePerformance

Alternative
Alternative
solutions
solutions
Training Yes
No need?
Alternative
solutions
Design & development of training programs
(Gomez-Mejia, Balkin & Cardy, 2012)

 Location:
 On the job training
 Off the job training
 Presentation:
 Teletraining: Many trainees, many locations, training at
the same time
 Computer based training: Training at one’s own time &
pace
 Simulations: Devices or situations that replicate job
demands at an off the job site
 Virtual reality: Absolute simulation

 Types of training (Gomez-Mejia, Balkin & Cardy, 2012)
 Skills training
 New skill training
 Retraining
 Cross functional training: Teaches employees to perform operations in areas
other than their assigned job.
 Peer trainers
 Team training
 Aspects
 Content tasks
 Group processes
 Virtual team training:
 Initial face to face team building session
 Use of technology
 Communication
 Team management
 Creativity training – Brainstorming
 Literacy training – Basic training in the rudimentary functions of programs
required for specific jobs
 Diversity training
 Types of training (Contd.)
(Gomez-Mejia, Balkin & Cardy, 2012)

 Creativity training – Brainstorming

 Literacy training – Basic training in the
rudimentary functions of programs required for
specific jobs
 Diversity training
 Crisis training
 Ethics training
 Customer service training
 Legal issues in training
 Principles of Learning (Cascio, 2003)
 Ingredients of skill learning
 Goal setting
 Goal theory: An individual’s conscious goals or intentions
regulate his or her behavior
Implications:
 Make the objectives of the training program clear at the outset
 Set challenging but achievable goals

 Achieve short term goals during the training

 Behavior modelling
 Physical similarity
 Clear portrayal of behaviors

 Rank the behaviors to be modelled

 Have several models portray the behaviors

Ingredients of skill learning (Contd.)
(Cascio, 2003)
 Meaningfulness of the material
 Provide trainees with overview of material
 Use examples, terms and concepts that trainees are
familiar with – scaffolding
 Teach simpler skills and then integrate them into
more complex skills
 Practice
 Active practice
 Overlearning
 Length of practice session: Distributed vs. massed
practice
 Transfer of training (Cascio, 2003)
 The extent to which competencies learnt in
training can be applied on the job
 Positive:Enhances performance
 Negative: Hampers performance
 Neutral: Has no effect on performance
 Action learning: Participants learn through
experience and application
 Team training (Cascio, 2003)
 Clear sense of direction
 Talented members
 Clear and enticing responsibilities
 Reasonable and efficient operating procedures
 Constructive interpersonal relationships
 Active reinforcement systems
 Constructive relationships with other teams and
key organizational players who are not
members
 Training methods (Cascio, 2003)
 Categories:
 Information presentation techniques
 Simulation methods
 On the job training methods
 Objectives:
 Promoting self insight and environmental
awareness
 Improving the ability of managers and lower level
employees to make decisions and solve job related
problems constructively
 Maximizing the desire to perform well
Selection of training methods (Cascio, 2003)

 Define training objective

 Motivate trainee to improve performance
 Clearly illustrate desired skills
 Allow the trainee to participate actively
 Provide an opportunity to practice
 Provide timely feedback on the trainee’s performance
 Provide some means for reinforcement while the
trainee learns
 Be structured from simple to complex tasks
 Be adaptable to specific problems
 Encourage positive transfer from the training to the job
Thank You
 Human Resources Management

The Training Process

Aradhna Malik (PhD)

Assistant Professor
VGSoM, IIT Kharagpur
 Sources
Briscoe, D.R., Schuler, R. S. & Claus, L. (2009). International human resource
management: Policies and practices for multinational enterprises. NY:
Routledge.
Cascio, W. F. (2003). Managing human resources: Productivity, quality of work
life, profits. New Delhi: Tata McGraw Hill.
Cleveland, J. N., Murphy, K. R. & Williams, R. E. (1989). Multiple uses of
performance appraisal: Prevalence & correlates. Journal of Applied
Psychology, 74(1), 130-135.
Dessler, G. (2005). Human resources management (10th Ed.). New Delhi:
Pearson.
Dessler, G. & Varkkey, B. (2011). Human Resource Management (10th Ed.). New
Delhi: Pearson.
Gilmore, S. & Williams, S. (Eds.) (2009). Human Resources Management (Indian
Edition). New Delhi: Oxford.
Gomez-Mejia, L. R., Balkin, D. B. & Cardy, R. L. (2012). Managing human
resources (7th Ed.). New Delhi: PHI Ltd.
Gray, G. (2002). Performance appraisals don’t work. Industrial Management,
44(2), 15-17.
Modaff, D.P. & DeWine, S. (2002). Organizational Communication: Foundations,
 Training &
Development
The Training Process (Dessler & Varkkey, 2011)
 Definition: “Training means giving new or
current employees the skills they need to
perform their jobs.”
 Negligent training: Insufficient training or
training not suited for the job the employee may
be assigned
 Aligning strategy and training = learning needs
+ individual needs of employees +
organizational needs + appropriate training +
individual performance aligned with
Challenges in training (Gomez-Mejia, Balkin & Cardy, 2012)
 Is training the solution to the problem?
 Are the goals of training clear and realistic?
 Is training a good investment?
 Look inside & find trainers from within the
organization
 Focus training on what is needed
 Give training a strategic alignment
 Capitalize on reduced costs of online training
(IMA, 2002, Baun & Scott, 2010, and Engebreston, 2010, in Gomez-Mejia, Balkin &
Cardy, 2012)

 Will the training work?

Training needs assessment model (Cascio, 2003)
Environment Training Cycle
• Unions
• Economy
• Laws Yes Individual
Yes
Analysis
Operations • Knowledge
Organization analysis Training Training
Analysis • Skills
• Objectives need? need?
• Requirements • Attitudes
• Resources
for efficiency
• Allocation of resources
Current Optimal
No Level of Level of
No performancePerformance

Alternative
Alternative
solutions
solutions
Training Yes
No need?
Alternative
solutions
 Principles of Learning (Cascio, 2003)
 Ingredients of skill learning
 Goal setting
 Goal theory: An individual’s conscious goals or intentions
regulate his or her behavior
Implications:
 Make the objectives of the training program clear at the outset
 Set challenging but achievable goals

 Achieve short term goals during the training

 Behavior modelling
 Physical similarity
 Clear portrayal of behaviors

 Rank the behaviors to be modelled

 Have several models portray the behaviors

Ingredients of skill learning (Contd.)
(Cascio, 2003)
 Meaningfulness of the material
 Provide trainees with overview of material
 Use examples, terms and concepts that trainees are
familiar with – scaffolding
 Teach simpler skills and then integrate them into
more complex skills
 Practice
 Active practice
 Overlearning
 Length of practice session: Distributed vs. massed
practice
 Transfer of training (Cascio, 2003)
 The extent to which competencies learnt in
training can be applied on the job
 Positive:Enhances performance
 Negative: Hampers performance
 Neutral: Has no effect on performance
 Action learning: Participants learn through
experience and application
 Team training (Cascio, 2003)
 Clear sense of direction
 Talented members
 Clear and enticing responsibilities
 Reasonable and efficient operating procedures
 Constructive interpersonal relationships
 Active reinforcement systems
 Constructive relationships with other teams and
key organizational players who are not
members
 Training methods (Cascio, 2003)
 Categories:
 Information presentation techniques
 Simulation methods
 On the job training methods
 Objectives:
 Promoting self insight and environmental
awareness
 Improving the ability of managers and lower level
employees to make decisions and solve job related
problems constructively
 Maximizing the desire to perform well
Selection of training methods (Cascio, 2003)

 Define training objective

 Motivate trainee to improve performance
 Clearly illustrate desired skills
 Allow the trainee to participate actively
 Provide an opportunity to practice
 Provide timely feedback on the trainee’s performance
 Provide some means for reinforcement while the
trainee learns
 Be structured from simple to complex tasks
 Be adaptable to specific problems
 Encourage positive transfer from the training to the job
Implementing programs (Dessler & Varkkey, 2011)
 On the job training (OJT): Having a person
learn a job by actually doing it.

 Types of on the job training:

 Coaching or understudy method
 Job rotation
 Special assignments: Representative projects
 The OJT Process (Dessler & Varkkey, 2011)
 Prepare the learner
 Put the learner at ease
 Explain why s/ he is being taught
 Create interest & find out what the learner already knows about the job
 Explain the whole job & relate it to some job the worker already knows
 Place the learner as close to the normal working position as possible
 Familiarize the worker with equipment, materials, tools, and trade
terms
 Present the operation
 Explain quantity and quality requirements
 Go through the job at the normal work pace
 Go through the job at a slow pace several times, explaining each step.
Explain wherever process may be perceived to be difficult
 Repeat at a slower pace, explaining the key points
 Have the learner explain the steps as you go through the job at a slow
pace
The OJT Process (Contd.) (Dessler & Varkkey, 2011)
 Try out the process
 Have the learner go through the job several times, slowly
explaining each step to the learner. Correct mistakes and, if
necessary, do some of the complicated steps the first few times.
 Run the job at the normal pace
 Have the learner do the job, gradually building up skill and
speed. As soon as the learner demonstrates ability to do the
job, let the work begin, but don’t abandon him/ her.
 Follow up
 Designate to whom the learner should go for help
 Gradually decrease supervision, checking work from time to
time
 Correct faulty work patterns before they become a habit. Show
why the method you suggest is superior.
Apprenticeship training (Dessler & Varkkey, 2011)
 Process by which people become skilled
workers, usually through a combination of
formal learning and long-term on-the-job
training.
 Apprenticeship in India: Apprentices Act 1961:
http://mhrd.gov.in/sites/upload_files/mhrd/files/A
pprenticeAct1961.pdf
Objectives:
 Promotion of new skills
 Improvement/ refinement of old skills through
theoretical and practical training in a number of
Other types of training programs (Dessler & Varkkey, 2011)

 Informal learning: Opportunities and encouragement

within an organization
 Job instruction training (JIT): Step by step learning
through a logical sequence of steps.
 Lectures:
 Don’t start out on the wrong foot by sounding unsure
 Give your listeners signals about what is to come
 Be alert to your audience
 Maintain eye contact with the audience
 Make sure everyone in the room can hear
 Control your hands
 Talk from notes rather than from a script
 Break a long talk into a series of five minute talks
Other types of training programs (Contd.)
(Dessler & Varkkey, 2011)
 Programmed learning: Step by step, self learning
method that consists of three parts:
 Presenting questions, facts, or problems to the learner
 Allowing the person to respond
 Providing feedback on the accuracy of answers
 Audiovisual based training esp. for mass training in
distance mode
 Vestibule training: Trainees learn on the actual or
simulated equipment they will use on the job, but are
trained off the job in a vestibule that resembles actual
job environment.
 Teletraining (one way) and videoconferencing
Other types of training programs (Contd.)
(Dessler & Varkkey, 2011)
 Electronic Performance Support Systems (EPSS):
Computerized tools and displays that automate training,
documentation, and phone support.
 Job aid: Set of instructions, diagrams, or similar methods
available at the job site to guide the worker
 Computer based training:
 Programmed Instruction
 CBT
 Computer managed instruction
 Intelligent computer assisted instruction
 Intelligent tutoring systems
 Simulations

Other types of training programs (Contd.)
(Dessler & Varkkey, 2011)
 Simulated learning:
 Virtual reality type games
 Step by step animated guide
 Scenarios with questions and decision trees overlaying simulation
 Online role play with photos and videos
 Software training including screenshots with interactive requests
 Internet based training
 Learning portals
 Learning management systems
 Virtual classroom: Uses special collabortion software to enable
multiple remote learners, using their PCs or laptops, to participate
in live audio and visual discussions, communicate via written text,
and learn via shared content.
Other types of training programs (Contd.)
(Dessler & Varkkey, 2011)
 Lifelong learning: Providing employees with continuing
learning experiences over their tenure with the firm, with
the aims of ensuring they have the opportunity to learn
the skills they need to do their jobs and to expand their
horizons.
 Voice and accent training in BPOs
 Management development: Any attempt to improve
managerial performance by imparting knowledge,
changing attitudes, or increasing skills.
 Assessing the company’s strategic needs
 Appraising managers’ current performance
 Developing managers
Managerial on the job training
(Dessler & Varkkey, 2011)

 Job rotation: Moving managers from department to

department to broaden their understanding of the
business and to test their abilities
 Coaching/ understudy approach: Similar to
apprenticeship
 Action learning: Give managers and others released
time to work analyzing and solving problems in
departments other than their own
 Framework phase of 6 to 8 weeks – planning & collection of
data
 Action forum – 2 to 3 days – actual designing of action plans
to solve problems listed above
Off the job management training & development
techniques (Dessler & Varkkey, 2011)
 Case study method: Presents a trainee with a written description of an organizational
problem. Trainee analyzes the case, diagnoses the problem, & presents findings &
solutions in a discussion with other trainees.
 Management games: Simulated marketplace situation.
 Outside seminars
 University related programs: In house training programs by Institutes of Higher
Education
 Role playing: Creation of realistic situations and have trainees assume the parts of
specific persons in that situation
 Behavior modelling:
 Modelling: Trainer models
 Role playing: Trainees try
 Social reinforcement: Reinforcement & feedback to trainees
 Transfer of training: Trainees apply training to real life
 Corporate Universities: In house development centres
 Executive coaches: Outside consultant
 Professional associations: All India Management Association, Institution of
Creating your own training program
(Dessler & Varkkey, 2011)
 Step 1: Set training objectives
 Step 2: Use a detailed job description
 Step 3: Develop an abbreviated task analysis
record form
 Step 4: Develop a job instruction sheet
 Step 5: Compile training program for the job
Evaluating training programs
(Cascio, 2003; Dessler & Varkkey, 2011)
 Training effects one needs to measure:
 Reaction
 Learning
 Behavior
 Results
 Questions one needs to ask to measure these effects
 Have the trainees achieved a specific level of skill knowledge or
performance?
 Did the change occur?
 Is the change due to the training?
 Is the change positively related to the achievement of
organizational goals?
 Will similar changes occur with new participants in the same
Thank You
 Human Resource Management

Career Planning & Management

Aradhna Malik (PhD)

Assistant Professor
VGSOM, IIT Kharagpur
 Sources
Briscoe, D.R., Schuler, R. S. & Claus, L. (2009). International human
resource management: Policies and practices for multinational
enterprises. NY: Routledge.
Cascio, W. F. (2003). Managing human resources: Productivity, quality of
work life, profits. New Delhi: Tata McGraw Hill.
Dessler, G. (2005). Human resources management (10th Ed.). New Delhi:
Pearson.
Dessler, G. & Varkkey, B. (2011). Human Resource Management (10th Ed.).
New Delhi: Pearson.
Gilmore, S. & Williams, S. (Eds.) (2009). Human Resources Management
(Indian Edition). New Delhi: Oxford.
Gomez-Mejia, L. R., Balkin, D. B. & Cardy, R. L. (2012). Managing human
resources (7th Ed.). New Delhi: PHI Ltd.
McIntyre-Smith, S. (2005). Practising succession planning. CA Magazine,
138(6), 30-36.
Modaff, D.P. & DeWine, S. (2002). Organizational Communication:
Foundations, Challenges and Misunderstandings. Los Angeles, CA:
Roxbury.
Career planning
and
management
 Definitions (Cascio, 2003; Dessler & Varkkey, 2011)
 Career: sequence of positions occupied by a person during the course of
a lifetime.
 Career consists of a sense of where one is going in one’s work life.
 Perceived talents and abilities
 Basic values
 Career motives and needs
 Career management: Process for enabling employees to better
understand and develop their career skills and interests and to use these
skills most effectively within the company and after they leave the firm.
 Career development: The lifelong series of activities that contribute to a
person’s career exploration, establishment, success, and fulfillment
 Career planning: The formal process through which someone becomes
aware of his or her 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
Challenges to career management
(Cascio, 2003)

 Should employees be responsible for their own

career development?
 Is the new approach to corporate career
management likely to be a passing fad, or is it
here to stay?
 What kinds of support mechanisms are
necessary to make career self management
work?
Challenges to planning careers
(Cascio, 2003)

 Rising concerns for quality of work life and

for personal life planning
 Pressures to expand workforce diversity
throughout all levels of an organization
 Rising educational levels and occupational
aspirations coupled with
 Slow economic growth and reduced
opportunities for advancement
Signs indicating the need for a career
management system (Gomez-Mejia, Balkin & Cardy, 2012)
 Is the employee more interested in capitalizing
on opportunities for advancement than in
maintaining adequate performance?
 Does the employee devote more attention to
managing the impressions s/he makes on
others than to reality?
 Does the employee emphasize networking,
flattery, and being seen at social functions over
job performance?
Career success (Cascio, 2003)
 Occupational success?
 Job satisfaction?
 Growth and development of skills?
 Successful movement through various
stages of life?
Career management: Organizations
focusing on individuals (Cascio, 2003)
 Socialization: Already discussed
 Mentoring & reverse mentoring (Older
employees learn new skills from new
entrants)
 Early career: Impact of the first job
 Priorhistory of promotions
 Functional area background
 Number of different jobs held
Career management:
Individuals focusing
on themselves
Self-reliance: Key to career
management for the 21st century (Cascio, 2003)
 Self-assessment
 Career planning
 Supervisory training
 Succession planning
Selecting a field of employment
and an employer (Cascio, 2003)
 Macro-long-range objective: Think in terms of
where you ultimately want to be, recognizing that
your career goals will change over time
 View every potential employer and position in
terms of your long range career goal.
 Accept short-term trade-offs for long-term benefits.
 Consider carefully whether to accept highly
specialized jobs or isolated job assignments that
might restrict or impede your visibility and career
development
 Knowing where you are (Cascio, 2003)
 Always be aware of opportunities available to
you in your current position – for instance,
training programs that might further your career
development
 Carefully and honestly assess your current
performance. How do you see yourself, and
how do you think higher management sees
your performance?
 Try to recognize when you and your
organization have outlived your utility for each
other.
Self development
Domains of self development
(Smith, 2010, Hopke, 2010, & North, 2008, in Gomez-Mejia, Balkin & cardy, 2012)

 Money:
 How much do you want to make?
 How important is money to you?
 What are you willing to sacrifice to make money?
 Work:
 What kind of work do you want to do?
 What kind of work fits your strengths & values?
 What kind of work do you not like to do?
 What level of responsibility do you want?
 Life:
 What do you want outside of work?
 How important is family to you?
Development suggestions
(Gomez-Mejia, Balkin & Cardy, 2012)

 Identify your mission: Business you would like

to be in & the role you would like to play
 Keep learning: Identify what you can learn to
improve your potential, and the skills that can
add to what you currently know and help you in
your larger goal in life
 Develop competencies: Look ahead and do
what you need to do to take care of the larger
goal in life.
 Find a mentor
Advancement suggestions
(Gomez-Mejia, Balkin & Cardy, 2012)

Steps you can take to improve your chances of

being considered for advancement
 Market yourself
 Understand business trends
 Resolve problems
 Improve your communication skills
 Focus:
Career Objective

Planning helps you decide:

1. The number of steps you need to

take to reach your objective
2. The total time you need to reach
your objective
3. The amount of energy you need to
reach your objective
4. The number of times you need to/
can recharge your batteries
5. The time you can spend at each step
or landing
Career Objective and Profile Summary

 Career objective – one short, crisp sentence

about where you want to be at the peak of your
career

 Profile summary – a short paragraph that

summarizes your life and persuades the
employer to read the rest of your résumé
Exercise
1. Taking this time as your starting point, write down
as crisply as possible, where you would like to be at
the peak of your career, in not more than 20 words.
2. Taking this time as your starting point, develop a
profile summary not more than 50 words long, to
highlight your achievements till date and focus them
towards the career objective you have talked about
earlier.
3. Develop a roadmap for your career taking this time
as your starting point, and make an outline for your
plan for your journey from now to the time you
Hewlett Packard’s Career Self-management
Program (Cascio, 2003)
 A written self interview regarding their life and dreams
outside of the workplace
 Strong vocational interest inventory: 325 questions to
determine their preference about occupations, academic
subjects, types of people, etc. – interest profile developed
 Allport-Vernon-Lindzey study of values: 45 choices among
competing values in order to measure the relative strength
of theoretical, economic, aesthetic, social, political, and
religious values
 24 Hour Diaries: Log of activities during one workday
 Interviews with two significant others regarding the
employee
 Lifestyle representations using tools other than words
 Planning your exit (Cascio, 2003)
 Try to leave at your convenience, not when the
organization wants you to
 Leave your current organization on good terms
and not under questionable circumstances
 Don’t leave your job till you’ve got another one
Proactive career management
(Cascio, 2003)

 Boundaryless careers:
 Portable knowledge, skills, and abilities
across multiple firms
 Personal identification with meaningful work
 On the job action learning
 Development of multiple networks of
associates and peer learning relationships
 Responsibility for managing one’s own career
Methods of career management
(Dessler & Varkkey, 2011)

 Role of employer:
 Tailored in house career management methods e.g.
HP Career Self management program
 Career planning workshops
 Lifelong learning budgets
 Role reversal
 Career success teams
 Career coaches through organization
 Online programs
 Methods… (Contd.) (Dessler & Varkkey, 2011)
 Commitment oriented career development efforts,
e.g. Career oriented appraisals
 Mentoring:
 Coaching focuses on daily tasks that you can easily re-
learn
 Mentoring focuses on relatively hard – to reverse longer
term issues, and often touches on the person’s psyche.
 Effective mentoring:
 Trust
 Professional competence
 Consistency
 Ability to communicate
 Readiness to share control
Meeting the challenges of effective career
development (Gomez-Mejia, Balkin & Cardy, 2012)
 The assessment phase: “To identify the strengths
& weaknesses of employees” to help employees
 Choose a career that is realistically obtainable and a
good fit
 To determine the weaknesses they need to overcome
to achieve their career goals
Ways:
 Self assessment
 Career workbooks
 Skills assessment exercise:
 Values clarification
 Career-planning workshops
Career anchors (Kanchier, 2006, Danziger, Rachman-Moore & Valkency, 2008,
Wong, 2007, & Wils, Wils & Trembley, 2010, in Gomez-Mejia, Balkin & Cardy, 2012)

 What?: Core values of a worker

 Identification: Career anchors orientation inventory by Schien
 Implications for each career anchor so identified:
 Give the worker opportunity to develop work standards & to mentor others
 Give the worker opportunities to lead projects or teams
 Ask the worker to take on the role of an internal consultant and tackle a
workplace problem
 Let the worker know that staying in his or her current position is an option
 Give this worker new projects & let him or her develop ideas as an internal
entrepreneur
 Offer this worker some responsibility for a company program, such as
diversity, or the opportunity to partner with a local charity
 Set stretch goals with the worker & empower him or her to make the
decisions needed to get there
 Offer this worker flexibility in his or her work schedule & the opportunity to
work from home.
Assessment phase (Contd.)
(Gomez-Mejia, Balkin & Cardy, 2012)

 Organizational assessment
 Assessment centers:
 Situational exercises such as interviews, in-basket exercises &
business games, that are often used to select managerial talent
 Give feedback & direction to worker
 Measure competencies needed for a particular job & provide
participants with feedback about their strengths & weaknesses in the
competency areas as uncovered in the exercises
 Psychological testing: Personality, attitudes, interest inventories
 Performance appraisal
 Promotability forecasts: Decisions made by managers
regarding the advancement potential of their subordinates. High
potential candidates are given developmental experiences to
help them achieve their advancement potential
 Succession planning
Direction phase of career development
(Gomez-Mejia, Balkin & Cardy, 2002)

 Involves determining the type of career that

employees want & the steps they must take to
realize their career goals.
 Individualcareer counseling: One on one sessions with
the goal of helping employees examine their career
aspirations. E.g. careerplanning.com, careerjournal.com
 Information services:
 Job positing systems
 Skills inventories
 Career paths
 Career resource centre: Collection of career development
materials such as workbooks, tapes, & texts
Development phase of career development
(Gomez-Mejia, Balkin & Cardy, 2012)

Involves taking actions to create & increase skills to prepare

for future job requirements
 Mentoring: Developmentally oriented relationship between
senior & junior colleagues or peers that involves advising,
role modeling, sharing contacts, & giving general support.
 Coaching: Ongoing, sometimes spontaneous, meetings
between managers & their employees to discuss the
employee’s career goals & development.
 Tuition assistance programs: To support the education &
development of employees
 Job rotation: Assigns employees to various jobs so that
they acquire a wider base of skills
Ways to rotate jobs
(HRFocus, 2008, in Gomez-Mejia, Balkin & Cardy, 2012)

 Project rotation: Rotation across special projects

 Partial rotation: Rotation to other departments for specific
time periods, e.g. once a week or one week in a month,
etc.
 Cross-functional rotation: : Movement of employees
between business units or functions.
 Cross-region rotation: Rotation between regions or
countries
 Temporary rotations: Rotations to fill short-term needs
created by vacations, sick leave, turnover, etc.
 Inter-departmental mentoring: Coaching new employees in
different departments
Thank You
 Human Resource Management

Self Development

Aradhna Malik (PhD)

Assistant Professor
VGSoM, IIT Kharagpur
 Sources
Briscoe, D.R., Schuler, R. S. & Claus, L. (2009). International human resource
management: Policies and practices for multinational enterprises. NY: Routledge.
Cascio, W. F. (2003). Managing human resources: Productivity, quality of work life,
profits. New Delhi: Tata McGraw Hill.
Dessler, G. (2005). Human resources management (10th Ed.). New Delhi: Pearson.
Dessler, G. & Varkkey, B. (2011). Human Resource Management (10th Ed.). New
Delhi: Pearson.
Gilmore, S. & Williams, S. (Eds.) (2009). Human Resources Management (Indian
Edition). New Delhi: Oxford.
Gomez-Mejia, L. R., Balkin, D. B. & Cardy, R. L. (2012). Managing human resources
(7th Ed.). New Delhi: PHI Ltd.
Leibman, M. Bruer, R. A. & Maki, B. R. (1996). Succession management: The next
generation of succession planning. HR. Human Resource Planning, 19(3), 16-29.
McIntyre-Smith, S. (2005). Practising succession planning. CA Magazine, 138(6), 30-
36.
Nieh, L-C, McLean, G. N. (2011). Succession planning and managerial ethics in the
retail industry. Organizational Development Journal, 9(2), 36-45.
Tabatabaeee, S. A. N., Lakeh, A. A. & Tadi, A. A. (2014). A study of succession
planning challenges in governmental organizations. Kuwait Chapter of Arabian
Journal of Business & Management Review, 3(11a), 231-238.
Self development
Domains of self development
(Smith, 2010, Hopke, 2010, & North, 2008, in Gomez-Mejia, Balkin & cardy, 2012)

 Money:
 How much do you want to make?
 How important is money to you?
 What are you willing to sacrifice to make money?
 Work:
 What kind of work do you want to do?
 What kind of work fits your strengths & values?
 What kind of work do you not like to do?
 What level of responsibility do you want?
 Life:
 What do you want outside of work?
 How important is family to you?
Development suggestions
(Gomez-Mejia, Balkin & Cardy, 2012)

 Identify your mission: Business you would like

to be in & the role you would like to play
 Keep learning: Identify what you can learn to
improve your potential, and the skills that can
add to what you currently know and help you in
your larger goal in life
 Develop competencies: Look ahead and do
what you need to do to take care of the larger
goal in life.
 Find a mentor
Advancement suggestions
(Gomez-Mejia, Balkin & Cardy, 2012)

Steps you can take to improve your chances of

being considered for advancement
 Market yourself
 Understand business trends
 Resolve problems
 Improve your communication skills
 Focus:
Career Objective

Planning helps you decide:

1. The number of steps you need to

take to reach your objective
2. The total time you need to reach
your objective
3. The amount of energy you need to
reach your objective
4. The number of times you need to/
can recharge your batteries
5. The time you can spend at each step
or landing
Career Objective and Profile Summary

 Career objective – one short, crisp sentence

about where you want to be at the peak of your
career

 Profile summary – a short paragraph that

summarizes your life and persuades the
employer to read the rest of your résumé
Exercise
1. Taking this time as your starting point, write down
as crisply as possible, where you would like to be at
the peak of your career, in not more than 20 words.
2. Taking this time as your starting point, develop a
profile summary not more than 50 words long, to
highlight your achievements till date and focus them
towards the career objective you have talked about
earlier.
3. Develop a roadmap for your career taking this time
as your starting point, and make an outline for your
plan for your journey from now to the time you
Meeting the challenges of effective career
development (Gomez-Mejia, Balkin & Cardy, 2012)
 The assessment phase: “To identify the strengths
& weaknesses of employees” to help employees
 Choose a career that is realistically obtainable and a
good fit
 To determine the weaknesses they need to overcome
to achieve their career goals
Ways:
 Self assessment
 Career workbooks
 Skills assessment exercise:
 Values clarification
 Career-planning workshops
Career anchors (Kanchier, 2006, Danziger, Rachman-Moore & Valkency, 2008,
Wong, 2007, & Wils, Wils & Trembley, 2010, in Gomez-Mejia, Balkin & Cardy, 2012)

 What?: Core values of a worker

 Identification: Career anchors orientation inventory by Schien
 Implications for each career anchor so identified:
 Give the worker opportunity to develop work standards & to mentor others
 Give the worker opportunities to lead projects or teams
 Ask the worker to take on the role of an internal consultant and tackle a
workplace problem
 Let the worker know that staying in his or her current position is an option
 Give this worker new projects & let him or her develop ideas as an internal
entrepreneur
 Offer this worker some responsibility for a company program, such as
diversity, or the opportunity to partner with a local charity
 Set stretch goals with the worker & empower him or her to make the
decisions needed to get there
 Offer this worker flexibility in his or her work schedule & the opportunity to
work from home.
Assessment phase (Contd.)
(Gomez-Mejia, Balkin & Cardy, 2012)

 Organizational assessment
 Assessment centers:
 Situational exercises such as interviews, in-basket exercises &
business games, that are often used to select managerial talent
 Give feedback & direction to worker
 Measure competencies needed for a particular job & provide
participants with feedback about their strengths & weaknesses in the
competency areas as uncovered in the exercises
 Psychological testing: Personality, attitudes, interest inventories
 Performance appraisal
 Promotability forecasts: Decisions made by managers
regarding the advancement potential of their subordinates. High
potential candidates are given developmental experiences to
help them achieve their advancement potential
 Succession planning
Direction phase of career development
(Gomez-Mejia, Balkin & Cardy, 2002)

 Involves determining the type of career that

employees want & the steps they must take to
realize their career goals.
 Individualcareer counseling: One on one sessions with
the goal of helping employees examine their career
aspirations. E.g. careerplanning.com, careerjournal.com
 Information services:
 Job positing systems
 Skills inventories
 Career paths
 Career resource centre: Collection of career development
materials such as workbooks, tapes, & texts
Development phase of career development
(Gomez-Mejia, Balkin & Cardy, 2012)

Involves taking actions to create & increase skills to prepare

for future job requirements
 Mentoring: Developmentally oriented relationship between
senior & junior colleagues or peers that involves advising,
role modeling, sharing contacts, & giving general support.
 Coaching: Ongoing, sometimes spontaneous, meetings
between managers & their employees to discuss the
employee’s career goals & development.
 Tuition assistance programs: To support the education &
development of employees
 Job rotation: Assigns employees to various jobs so that
they acquire a wider base of skills
Ways to rotate jobs
(HRFocus, 2008, in Gomez-Mejia, Balkin & Cardy, 2012)

 Project rotation: Rotation across special projects

 Partial rotation: Rotation to other departments for specific
time periods, e.g. once a week or one week in a month,
etc.
 Cross-functional rotation: : Movement of employees
between business units or functions.
 Cross-region rotation: Rotation between regions or
countries
 Temporary rotations: Rotations to fill short-term needs
created by vacations, sick leave, turnover, etc.
 Inter-departmental mentoring: Coaching new employees in
different departments
Methods of career management
(Dessler & Varkkey, 2011)

 Role of employer:
 Tailored in house career management methods e.g.
HP Career Self management program
 Career planning workshops
 Lifelong learning budgets
 Role reversal
 Career success teams
 Career coaches through organization
 Online programs
 Methods… (Contd.) (Dessler & Varkkey, 2011)
 Commitment oriented career development efforts,
e.g. Career oriented appraisals
 Mentoring:
 Coaching focuses on daily tasks that you can easily re-
learn
 Mentoring focuses on relatively hard – to reverse longer
term issues, and often touches on the person’s psyche.
 Effective mentoring:
 Trust
 Professional competence
 Consistency
 Ability to communicate
 Readiness to share control
Succession planning
 “Succession planning is about developing
potential employees for success” (Harrison, McKinnon &
Terry, 2006, in Nieh & McLean, 2011)

 “A strategic process to assist organizations in

identifying, selecting, training, & developing
potential employees.” (McConnell, 1996, in Nieh & McLean, 2011)
 “Structured approach to create consistent &
continuous leadership in the organization” (Wilcox,
2002, in Tabatabaee, Lakeh & Tadi, 2014)
Significance of succession planning
(Leibman, Bruer & Maki, 1996)

 Assuring the continuity of prepared leaders for key

executive positions
 Engagement of senior management team in a disciplined
process of reviewing the corporation’s leadership talent
 Putting the diversity issue on the corporate agenda
 Guiding the development activities of key executives
 Re-examining corporate & business unit structure,
processes & systems
 Alignment with other HR that support the leadership
renewal process (e.g. selection systems, rewards
 Contributing to the shareholder value
Challenges to succession planning
(Tabatabaee, Lakeh & Tadi, 2014)

 Managerial factors:
 Management’s fear of succession planning due to the possibility of
change
 Lack of scientific HR management
 Managers being changed regularly, lack of responsibility by the
manager
 Lack of skills, information, & awareness by the manager
 Incompetent manager
 Cultural factors
 Lack of succession planning culture
 Ignoring talent in the organization
 Inappropriate organizational culture
 Fear of succession planning, not believing in successors in the
Challenges to succession planning (Contd.)
(Tabatabaee, Lakeh & Tadi, 2014)

 Legal factors
 Politicalfigures being overinvolved in position assignments
 Rules & regulations
 Lack of formal succession planning in the government
 Legal factors
 Lack of training opportunities
 Lack of legal requirements regarding strategic planning
 Educational factors: Lack of time & resources
 Cost factors
 Lack of a proper system of management
 Lack of skilled managers
Steps to effective succession planning
(McIntyre-Smith, 2005)

1. Get your house in order

2. Prepare an information package
3. Determine price range/ compensation
4. Determine negotiables
5. Set a date
6. Spread the word
7. Meet & greet
8. Select the winner
9. Come to an agreement
10. Announcements & transitions
11. Honor post-deal commitments
Making promotion decisions (Dessler & Varkkey, 2011)

 Types of decisions:
 Decision 1: Is seniority or competence the rule?
 Decision 2: How should we measure competence?
 Decision 3: Is the process formal or informal?
 Decision 4: Vertical, horizontal, or other?
 Sources of bias:
 Gender
 Race/ community
 Horns/ halo effect
Managing retirements (Dessler & Varkkey, 2011)
 Methods:
 Create a culture that honors experience
 Modify selection procedures
 Offer flexible or part time work
 Phased retirement
 Pre-retirement counselling:
 Retirement benefits
 Leisure time
 Financial and investment counseling
 Health
 Psychological counseling
 Counseling for re-employment outside/ within the same
Dual career couples: Problems and
opportunities (Cascio, 2003)
 Work schedules
 Working in the office vs. flexi-timings vs.
telecommuting
 Balancing and sharing work and family
responsibilities
 Travel
 Finances
 Transfers
Managing men and women mid career
(Cascio, 2003)
 Challenges:
 Awareness of advancing age and an awareness of
death
 Awareness of body changes related to aging
 Knowing how many career goals have been or will
be attained
 Search for new life goals
 Marked change in family relationships
 Change in work relationships: senior vs. newbie
 Growing sense of obsolescence at work: Plateaued
worker
 Feeling of decreased job mobility and increased
concern for job security
 Managing older workers (Cascio, 2003)
 Productivity: Coherence between ability and activity and job
 Preparedness for change
 Absence
 Tendency for accidents on the job
 Interpersonal relationships at work
 Cost of employee benefits
 Flexibility regarding the work assigned
 Interruptions and ego issues
 Training opportunities
 Maintenance of records
 Suitability and modification of performance appraisal
systems
 Career management:
Organizations focusing on
their own maintenance and
growth
Development of a career system composed
of individual career paths (Cascio, 2003)
 Step 1: Analyze jobs to determine similarities and
differences among them
 Step 2: Group jobs with similar behavioral
requirements into job families
 Step 3: Identify career paths within and among job
families
 Step 4: Integrate the overall network of career paths
into a single career system
Requirements of career paths (Cascio, 2003)
 Representation of real progression possibilities,
without implied ‘normal’ rates of progress or forced
specialization in a technical area
 Tentativeness and responsiveness to changes in
job content, work priorities, organizational patterns,
and management needs
 Flexibility in terms of recognition of employee
needs and priorities
 Specification of skills, knowledge, and other
attributes to perform effectively at each position
along the paths, and clear directions on how they
Reasons for failure of organizational
career management systems (Cascio, 2003)
 Employees believe that supervisors do not care
about their development
 Neither the employee nor the organization are
fully aware of the employee’s needs and
organizational constraints
 Career plans are developed without regard for
the support systems necessary to fulfill the
plans
Internal staffing decisions: Patterns of
career change (Cascio, 2003)
 Promotions
 Demotions
 Transfers and relocations
 Layoffs, retirements, and resignations
Direct costs Indirect costs
Severance pay, pay in lieu of Recruiting and employment cost of new hires
notice
Accrued vacation & sick pay Training and recruiting
Supplemental unemployment Increase in unemployment tax rate
benefits
Outplacement Potential charges of unfairness & discrimination
Pension & benefit payoffs Low morale among remaining employees
Administrative processing costs Heightened insecurity and reduced productivity
Employee separations (Gomez-Mejia, Balkin & Cardy, 2012)
 Concepts
 “Employee separation occurs when an employee
ceases to be a member of an organization.”
 “Turnover rate is a measure of the rate at which
employees leave the firm”
 Benefits
 Reduced labor costs
 Replacement of poor performance
 Increased innovation
 Opportunity for greater diversity
 Costs involved in employee separations
(Gomez-Mejia, Balkin & Cardy, 2012)
 Recruitment
 Advertising
 Campus visits
 Recruiter time
 Search firm fees
 Selection
 Interviewing & Testing
 Reference checks
 Relocation
 Training
 Orientation
 Direct training
 Trainer’s time
 Lost productivity during training
 Separation
 Separation pay & benefits
 Benefits
 Unemployment insurance cost
 Exit interview
 Outplacement assistance
 Vacant position
Types of separation (Gomez-Mejia, Balkin & Cardy, 2012)
 Voluntary separation: Occurs when an employee
decides, for personal or professional reasons, to end the
relationship with the employer.
 Quitting
 Retirement
 Involuntary separation: “Occurs when management
decides to terminate its relationship with an employee
due to (1) economic necessity, or (b) poor fit between
employee & the organization
 Discharge due to poor fit (poor performance or unacceptable
behavior)
 Layoff, downsizing & rightsizing due to necessity to cut costs
& improve efficiency by reallocation of responsibility among
Handling layoffs in small business
(Aubry, 2009, Karlin, 2010, & Robertson & Sullivan, 2010, in Gomez-Mejia, Balkin & Cardy, 2012)

 Be clear about the reason for the layoff

 Explain layoff criteria
 Take legal precautions
Implementing a layoff (Gomez-Mejia, Balkin & Cardy, 2012)
 Notifying employees ahead of time
 Developing layoff criteria
 Communicating to laid off employees as
sensitively as possible
 Coordinating media relations
 Maintaining security
 Reassuring survivors of the layoff
 Handling survivors of layoffs
(Gomez-Mejia, Balkin & Cardy, 2012)
 Reasons for survivor anxiety (Brink, 2008, Kennedy, 2005, & Atchison, 2009, in Gomez-

Mejia, Balkin & Cardy, 2012):

 More work
 Unsettling changes
 Self-assessment of contribution
 Guilt
 Depression
 Keeping up morale & performance of survivors (Marshall, 2005, in

Gomez-Mejia, Balkin & Cardy, 2012):

 What can you control

 Do you show appreciation to your employees & make work fun?
 Are you listening?
 Are you helping employees see the importance of their work?
Alternatives to Layoffs (Gomez-Mejia, Balkin & Cardy, 2012)

 Employment policies
 Reduction through attrition
 Hiring freeze
 Cut part-time employees
 Cut internships or co-ops
 Give subcontracted work to in-house employees
 Voluntary time off
 Leaves of absence
 Reduced work hours
 Changes in job design
 Transfers
 Relocation
 Job sharing
 Demotions
 Pay & benefits policies
 Pay freeze
 Cut overtime pay
 Use vacation & leave days
 Pay cuts
 Profit sharing or variable pay
One of the most acceptable alternative to
layoffs: Job sharing (Cascio, 2003)
 Advantages
 Availability
of complete pool of talent and creativity
 Continuation of benefits for everyone
 Reduction of overtime
 Retention of career orientation and potential for upward
mobility
 Elimination of the need for training temporary employees
 Disadvantages
 Perceived lack of job continuity
 Inconsistent supervision
 Accountability scattered/ divided among several
employees
 No reduction in non salary expenses
Thank You
 Human Resource Management

Compensation
Aradhna Malik
Assistant Professor
VGSOM, IIT Kharagpur
 Sources

Cascio, W. F. (2003). Managing Human

Resources: Productivity, Quality of Work Life,
Profits. New Delhi: Tata McGraw Hill.
Gomez-Mejia, L. R., Balkin, D. B. & Cardy, R. L.
(2012). Managing human resources (7th Ed.).
New Delhi: PHI Ltd.
Compensation
 What is compensation?
(Gomez-Mejia, Balkin & Cardy, 2012)

 Total compensation = Base compensation + pay incentives

+benefits
 Base Compensation: “Fixed pay an employee receives on a
regular basis, either in the form of a salary or as an hourly
wage.”
 Pay incentives: “Programs designed to reward employees for
good performance.”
 Benefits or indirect compensation: Additional programs to
enhance the level of comfort of the employee in the non-work
aspect of life. These include health insurance, vacations, etc.
 Perquisities: Type of benefits (also called perks) that are “…
available to employees with some special status in the
organization.”
Designing a compensation system
(Gomez-Mejia, Balkin & Cardy, 2012)

 Challenges of offering a wide variety of pay

policies & procedures:
 Designing a compensation system that is aligned
with the strategic objectives of the organization
 Rooted in and adapted to the “…firm’s unique
characteristics & environment.”
 Assessment of equity
(Cascio, 2003, Gomez-Mejia, Balkin & Cardy, 2012))

 Internal equity: In terms of the relative worth of

individual jobs to an organization, are pay rates
fair?
 External equity: Are the wages paid by an
organization ‘fair’ in terms of competitive market
rates outside the organization?
 Individual equity: Is each individual’s pay ‘fair’
relative to that of other individuals doing the
same or similar jobs?
 Fair pay: “Pay that employees generally view
Determination of equitable pay for work
(Cascio, 2003)
 Each assumes that employees perceive a fair
return for what they contribute to their jobs
 All include the concept of social comparison,
whereby employees determine what their
equitable return should be after comparing their
inputs and outcomes with those of their peers
and coworkers
 The theories assume that employees who
perceive themselves to be in an inequitable
situation will seek to reduce that inequity.
 Internal vs. external equity
(Gomez-Mejia, Balkin & Cardy, 2012)

 Fair pay: “Pay that employees generally view

as equitable.”
 Internal equity: “The perceived fairness of the
pay structure within a firm.”
 External equity: “The perceived fairness of pay
relative to what other employees are paying for
the same type of labor.”
 Criteria for developing a compensation plan
(Gomez-Mejia, Balkin & Cardy, 2012)

 “Internal vs. external equity: Will the compensation plan be perceived as

fair within the company, or will it be perceived as fair relative to what other
employers are paying for the same type of labor?
 Fixed vs. variable pay: Will compensation be paid monthly on a fixed basis
– through base salaries – or will it fluctuate depending on such pre-
established criteria such as performance & company profits?
 Performance vs. membership: Will compensation emphasize performance
& tie pay to individual or group contributions, or will it emphasize
membership in the organization – logging in a prescribed number of hours
each week & progressing up the organizational ladder?
 Job vs. individual pay: Will compensation be based on how the company
values a particular job, or will it be based on how much skill & knowledge
an employee brings to that job?
 Egalitarianism vs. elitism: Will the compensation plan place most
employees under the same compensation system (egalitarianism) or will it
establish different plans by organizational level and/ or employee group
(elitism)?
 Criteria for developing a compensation plan
(Contd.) (Gomez-Mejia, Balkin & Cardy, 2012)
 Below-market vs. above-market compensation: Will employees
be compensated at below-market levels, at market-levels, or at
above-market levels?
 Monetary vs. nonmonetary awards: Will the compensation plan
emphasize motivating employees through monetary rewards like
pay & stock options, or will it stress nonmonetary rewards such
as interesting work & job security?
 Open vs. secret pay: Will employees have access to information
about other workers’ compensation levels & how compensation
decisions are made (open pay) or will this knowledge be withheld
from employees (secret pay)?
 Centralization vs. decentralization of pay decisions: Will
compensation decisions be made in a tightly controlled central
location, or will they be delegated to managers of the firm’s units?
 Models that can be used to ensure equity of
compensation (Gomez-Mejia, Balkin & Cardy, 2012)
 Distributive justice model: “Holds that employees
exchange their contributions or input to the firm (skills,
effort, time, & so forth) for a set of outcomes.”:
 “Employees are constantly comparing what they bring to the
firm & what they receive in return, &
 Employees are constantly comparing this input/outcome
ration with that of other employees within the firm.”
 “Employees will think they are fairly paid when the ration of
their inputs & outputs is equivalent to that of other
employees whose job demands are similar to their own.”
 Labor market model: “Wage for any given occupation is
set at a point where the supply of labor equals the
demand for labor in the marketplace.
 Balancing equity (Gomez-Mejia, Balkin & Cardy, 2012)
 A firm should try to establish both internal &
external equity
 Challenges:
 Overperforming employees / ‘Superstars’
 Underperforming employees/ laggards
 Retention of needed expertise without having to
raise salary
 ….
Discuss in class/ with peers: Try to come up with
strategies to establish internal & external equity in
different types of organizations.
Strategic integration of compensation
plans and business plans (Cascio, 2003)
 Recognition of compensation as a pivotal control
and incentive mechanism that can be used flexibly
by management to attain business objectives
 Integration of pay systems and business strategy
formulation
 Integration of pay considerations into strategic
decision making processes
 Viewing organization’s performance as the
ultimate criterion of the success of strategic pay
decisions and operational compensation programs
 Performance vs. membership
(Gomez-Mejia, Balkin & Cardy, 2012)

 Performance-contingent compensation:
Traditional piece-rate plans (pay based on units
produced), sales commissions, awards.
 Membership-contingent compensation:
“Provision of same or similar wage to every
employeein a given job, as long as the
employee achieves at least satisfactory
performance… Salary progression occurs by
moving up in the organization, not by doing the
present job better.”
 Job vs. individual pay
(Gomez-Mejia, Balkin & Cardy, 2012)
 Knowledge based pay or skill-based pay: “Employees
are paid on the basis of the jobs they can do or the
talents they have that can be successfully applied to a
variety of tasks & situation.”
Works best in situations where:
 Technology is stable
 Jobs do not change often
 Employees do not need to cover for one another frequently
 Much training is required to learn a given job
 Turnover is relatively low
 Employees are expected to move up through the ranks over
time
 Jobs are fairly standardized within the industry
Individual based pay system works best when
(Gomez-Mejia, Balkin & Cardy, 2012)

 “The firm has a relatively educated workforce with both

the ability & the willingness to learn different jobs
 The company’s technology & organizational structure
change frequently
 Employee participation & teamwork are encouraged
throughout the organization
 Opportunities for upward mobility are limited
 Opportunities to learn new skills are present
 The costs of employee turnover & absenteeism in terms
of lost production are high
 Individual-based pay plans are common in manufacturing
environments that rely on continuous-process
Determinants of pay structure and level
(Cascio, 2003)

 Labor market conditions

 Legislation
 Collective bargaining
 Levelof wages
 Behavior of workers in relevant labor markets
 Managerial attitudes and an organization’s
ability to pay
Overview of pay system mechanics
(Cascio, 2003)
 Updated job descriptions
 Purposes
 Identification of important characteristics of each job so
that the relative worth of jobs can be determined
 Identification, definition and weighing of compensable

factors
 Job evaluation method
 Pay surveys
 Pay structure
Traditional job based compensation
model (Cascio, 2003)
1. Important job characteristics
2. Compensable factors
3. Job evaluation to rate the relative worth of jobs
4. Job hierarchy
5. Pay rates to attach pay rates in jobs
6. Pay structures to classify jobs by grade levels
7. Assignment of individual pay within a range for
each job
Policy issues affecting job evaluation
(Cascio, 2003)
 Perception of management regarding
differences between jobs
 Possibility to identify and operationalize
meaningful criteria for distinguishing between
jobs
 Ability to communicate these differences
convincingly to employees
 Current and future stability of jobs
 Consistency in job evaluation
Linking internal pay relationships to
market data (Cascio, 2003, Gomez-Mejia, Balkin & Cardy, 2012)
 Benchmark jobs: Assurance of similarity of
salary for similar jobs in the industry by using
salary surveys
 Relevant labor markets:
 Assurance of an accurate job match
 At-risk forms of pay, some of which are based on
individual performance and some on the profitability
of the organization
Developing a pay structure (Cascio, 2003)
 Jobs of the same general value should be
clustered into the same pay grade
 Jobs that clearly differ in value should be in
different pay grades
 There should be a smooth progression of point
groupings
 The new system should fit realistically into the
existing allocation of pay within a company
 The pay grades should conform reasonably
well to pay patterns in the relevant labor
Compensation tools (Gomez-Mejia, Balkin & Cardy, 2012)
 Job-based approaches: “Assume that work gets done
by people who are paid to perform well-defined jobs.
Each job is designed to accomplish specific tasks, & is
normally performed by several people. Because all
jobs are not equally important to the firm, & the labor
market puts a greater value on some jobs than on
others, the primary objective of the compensation
system is to allocate pay so that the most important
jobs pay the most.”
 Skill based approach: “Assumes that workers should
be paid not according to the job they hold, but rather by
how flexible or capable they are at performing multiple
Thank You
 Human Resource Management

Pay & Incentive Systems

Aradhna Malik (PhD)

Assistant Professor
VGSoM, IIT Kharagpur
Pay and incentive
systems
 Sources

Cascio, W. F. (2003). Managing Human

Resources: Productivity, Quality of Work Life,
Profits. New Delhi: Tata McGraw Hill.
Gomez-Mejia, L. R., Balkin, D. B. & Cardy, R. L.
(2012). Managing human resources (7th Ed.).
New Delhi: PHI Ltd.
 The trust gap (Cascio, 2003)
 Why?
 Disparityin incentives between top management,
middle management, and frontline workers
 Dwindling confidence in competence of top
management
 Challenges posed by trust gap
 Unfairness and the reasons thereof
 Predictable consequences of trust gap
 Strategies to deal with trust gap
Changing philosophies regarding
pay systems (Cascio, 2003)
 Increased willingness to reduce the size of the
workforce and to restrict pay to control the
costs of wages, salaries, and benefits
 Less concern with pay position relative to that
of competitors and more concern with what the
company can afford
 Implementation of programs to encourage and
reward performance – variable pay
Changing salary administration systems
(Cascio, 2003)
 Cost containment actions:
 Understand economic and legal factors that
determine pay levels
 Tie compensation strategy to general business
strategy
 Address key policy issues
 Develop systematic pay structures
 Paying what the company can afford
 Programs that encourage and reward
performance
 Components and objectives of organizational
reward systems (Cascio, 2003)
 Includes anything an employee values and desires that an
employer is able and willing to offer in exchange for
employee contributions
 Reward systems
 Financial
 Direct (Salaries)
 Indirect (Benefits)

 Nonfinancial
 Protection programs
 Employee engagement in decision making
 Effective supervision
 Recognition
 Training opportunities
 Supportive nurturing organizational culture
Alternatives to pay systems based on
job evaluation (Cascio, 2003)
 Market based pay: Direct market pricing approach for all of
the firm’s jobs
 Competency based pay: Workers are paid not on the basis of
the job they currently are doing but rather on the basis of the
number of jobs they are capable of doing
 Supportive HRM philosophy
 Profit sharing and participative management
 Job enrichment
 Frequent changes in technology and organization structure
 Employee exchanges: Rotation and transfers
 Learning opportunities
 High employee turnover
Policy issues in pay planning and
administration (Cascio, 2003)
 Pay secrecy
 Based on
 Work and business related rationale on which the system is based
 Pay ranges
 Pay increase schedules
 Availability of pay related data from the compensation department
 Forces managers to defend their pay decisions and practices
publicly
 Cost of mistaken pay decision escalates, since all the system’s
inconsistencies and weaknesses become visible once the cloak of
secrecy is lifted
 Open pay might induce some managers to reduce differences in
pay among subordinates in order to avoid conflict and the need to
 Policy issues (Contd.) (Cascio, 2003)
 Effect of inflation
 Pay compression: Narrowing of the ratios of pay
between jobs or pay grades in a firm’s pay structure
 Higher starting salaries for new hires, which lead long term
employees to see only a slight difference between their
current pay and that of new hires
 Hourly pay increases for unionized employees that exceed
those of salaried and nonunion employees
 Recruitment of new college graduates for management or
professional jobs at salaries above those of current
jobholders
 Excessive overtime payments to some employees or
payment of different overtime rates
 Rewarding
Performance
 Performance incentives (Cascio, 2003)
 Requirements:
 Simplicity
 Specificity
 Attainability
 Measurability
 Incentives for executives (Cascio, 2003)
 Why use long term incentive plans for senior
executives?
 Since short term incentives are indicative of and a
result of short term productivity, their perceived
value is short-lived
 Long term plans encourage
 Stability for senior management
 Development of new processes, plants and products that

open new markets and restore old ones

 Designing of strategic gains rather than short term

contribution to profits
 Ownership of processes and results
Incentives for lower level employees
(Cascio, 2003)
 Setting workload standards:
 Management’s responsibility
 Describe the job by means of job analysis
 Do a motion study – decide how the job is to be done
 Do a time study – decide how fast the job should be done
 Guidelines
 High repetitiveness
 Short job cycle
 Clear measurable output
 Affected by
 Type of product or service
 Method of service delivery
 Degree of quantification of service and/ or product
 Organizational needs including legal and social pressures
Thank You
 Human Resource Management

Pay & Incentive Systems

Aradhna Malik (PhD)

Assistant Professor
VGSoM, IIT Kharagpur
Pay and incentive
systems
 Team incentives (Cascio, 2003)
 Advantages
 Make it possible to reward workers who provide
essential services to line workers (indirect labor), yet
who are paid only regular base pay
 Encourage cooperation, not competition, among workers
 Disadvantages
 Fear that management will cut rates (or employees) if
employees produce too much
 Competition between teams
 Inability of workers to see their individual contributions to
the output of the team. If they don’t see the link between
their individual effort and increased rewards, they will not
be motivated to produce more
Organization-wide incentives (Cascio, 2003)
 Profit sharing: A percentage of the annual profit
is disbursed to employees annually
 Gain sharing: Productivity based. Disbursed
more frequently – quarterly or semiannually.
Encouraged through participative management
and cooperation to result in behavior
modification
Differences between profit sharing and gain
sharing to be tabulated by students
Organization incentives (Contd.) (Cascio, 2003)
 Employee stock ownership plans (ESOPs)
 Reasons
 Mergers and acquisitions
 Inexpensive way of borrowing money

 Enhance belief in employee ownership

 Additional employee benefit

 Conditions for success

 Large contributions by company to the plan
 Commitment of management to employee ownership

 Involvement of employees in decision making

 Transparency in communication

 Employee centric plans

Pay for performance systems
(Gomez-Mejia, Balkin & Cardy, 2012)

 Assumptions:
 Individual employees and work teams differ in how
much they contribute to the firm – not only in what
they do, but also in how well they do it
 The firm’s overall performance depends to a large
degree on the performance of individuals and
groups within the firm
 To attract, retain, & motivate high performers & to
be fair to all employees, a company needs to
reward employees on the basis of their relative
performance
Challenges of pay for performance
systems (Gomez-Mejia, Balkin & Cardy, 2012)
 “The ‘Do only what you get paid for’ syndrome
 Unethical behaviors
 Negative effects on the spirit of cooperation
 Lack of control
 Difficulties in measuring performance
 Psychological contracts (Set of expectations based
on prior experience)
 Credibility gap
 Job dissatisfaction & stress

Steps in creating job-based compensation plans
(Gomez-Mejia, Balkin & Cardy, 2012)
 Achieving internal equity: Job evaluation (“Process intended to
provide a rational orderly, & systematic judgment of how
important each job is to the firm”)
 Conduct job analysis
 Write job descriptions
 Determine job specifications
 Rate worth of all jobs using a predetermined system using
compensable factors (work-related criteria that the organization
considers most important in assessing the relative value of different
jobs)
 Create a job hierarchy based on the above
 Classify jobs by grade levels using:
 Ranking system (Sorting jobs into grades without using a point system)
 Factor comparison (Jointly using point and ranking system)
 Policy capturing (Estimation of relative value of each job based on the firm’s
Drawbacks of job-based compensation plans
(Gomez-Mejia, Balkin & Cardy, 2012)
 Do not take into account the nature of the business & its unique
problems
 Subjective & arbitrary
 With new developments, jobs have become more broadly defined
& generalized. Evaluation of relative importance of jobs is difficult.
 Tend to be bureaucratic, mechanistic, & inflexible. Difficult to
implement variable pay. Also difficult to adapt to changes in
economy.
 Wage & salary data obtained from market surveys are not
definitive.
 Employee’s perception of equity counts more than employer’s
perception of equity. These plans are not employee friendly.
 Not comfortable for freelancers and knowledge workers like
educators & researchers who compete for work in an open
market, and are creative multitaskers.
Job-based compensation plans: Suggestions
for practice (Gomez-Mejia, Balkin & Cardy, 2012)
 Think strategically in making policy decisions concerning pay
 Secure employee input
 Increase each job’s range of pay while expanding its scope of
responsibility
 Suggestions for job banding:
 Examine statistical evidence periodically to ensure that the job-
evaluation system is doing what it is supposed to
 Expand the proportion of employees’ pay that is variable (bonuses,
stock plans, & so forth)
 Develop policies for so-called knowledge workers that specify the types
of paid external opportunities they may pursue while still remaining
employed by the firm
 Establish dual-career ladders for different types of employees to that
moving into management ranks or up the organizational hierarchy is
Meeting the challenges of pay-for
performance systems (Gomez-Mejia, Balkin & Cardy, 2012)
 Link pay & performance appropriately:
 Piece rate systems: “Workers are paid per unit produced”
 Use pay for performance as part of a broader HRM
system
 Build employee trust
 Promote the belief that performance makes a difference
 Use multiple layers of rewards
 Increase employee involvement
 Stress the importance of acting ethically
 Use motivation & nonfinancial incentives
Types of pay for performance plans
(Gomez-Mejia, Balkin & Cardy, 2012)

 Individual based plans:

 Merit
pay: “Consists of an increase in base pay,
normally given once a year.”
 Bonus programs: Lump-sum payments: One
time
 Awards: Tangible prizes
 Merit pay systems (Cascio, 2003)
 Reasons for low success rates:
 Incentive value is too low (net cash in hand after taxes)
 Link between performance and rewards is weak
 Supervisors often resist performance appraisal
 Union contracts influence pay for performance decisions within and between
organizations
 Annuity problems: Money received as lump sum, so employees tend to slack.
Topping out – employees reach the top of their pay scale and then start
slacking as there is no real incentive to move on.
 Solution to the above
 Change from merit based to target based
 Guidelines for effective merit pay systems
 Establish high standards of performance
 Develop accurate performance appraisal systems
 Train supervisors in the mechanics of performance appraisal and in the art of
giving feedback to subordinates
 Tie rewards closely to performance
Advantages of individual pay-for
performance plans (Gomez-Mejia, Balkin & Cardy, 2012)
 Performance that is rewarded is likely to be
repeated: Expectancy theory
 Individuals are goal oriented & financial
incentives can shape an individual’s goals over
time
 Assessing the performance of each employee
individually helps the firm achieve individual
equity
 Individual based plans fit in with an individualistic
Disadvantages of individual-based pay
for performance plans (Gomez-Mejia, Balkin & Cardy, 2012)
 Tying pay to goals may promote single-
mindedness
 Many employees do not believe that pay &
performance are linked
 Individual pay plans may work against
achieving quality goals
 Individual based plans promote inflexibility in
some organizations
 Individual based plans are most likely
to succeed when (Gomez-Mejia, Balkin & Cardy, 2012)
 When the contributions of individual employees
can be accurately isolated
 When the job demands autonomy
 When cooperation is less critical to successful
performance or when competition is to be
encouraged
Factors commonly blamed for the failure of individual
based pay for performance systems (Gomez-Mejia, Balkin & Cardy, 2012)
 Performance appraisal is inherently subjective, with supervisors
evaluating subordinates according to their own preconceived biases
 Regardless of the appraisal form used, supervisors tend to manipulate
the ratings
 Merit systems emphasize individual rather than group goals, & this may
lead to dysfunctional conflict in the organization
 To maintain an effective working relationship with all subordinates &
prevent interpersonal conflict within the team, the supervisor may be
reluctant to single out individuals for special recognition with play
 The use of a specified time period for the performance evaluation
encourages a short-term orientation at the expense of long-term goals
 Employees try to defend their ego by ignoring negative performance
feedback blaming the organization for their problems
 Supervisors & employees seldom agree on the evaluation, leading to
interpersonal confrontations
 Supervisors often do not know how to justify a particular pay raise
recommendation to an employee
 Factors commonly blamed …(Contd.)
(Gomez-Mejia, Balkin & Cardy, 2012)
 Increments in financial rewards are spaced in such a way that their
reinforcement value for work behaviors is questionable.
 Individual merit pay systems are less appropriate for the service sector. In
knowledge-based jobs, it is even difficult to specify what the desired
product is.
 Supervisors typically control a rather limited amount of compensation, so
merit pay differentials are normally quite small &, therefore, of questionable
value
 A number of bureaucratic factors that influence the size & frequency of
merit pay (e.g. position in salary range, pay relationships within the unit &
between units, & budgetary limitations) have little to do with employee
performance
 Performance appraisals are designed for multiple purposes (training &
development, selection, work planning, compensation, etc.) When a
system is used to accomplish so many objectives, it is questionable
whether it can accomplish any of them well. It is difficult for the supervisor
to play the role of a counselor or advisor, and evaluator at the same time
Team based plans (Gomez-Mejia, Balkin & Cardy, 2012)
 Reward all team members equally, based on group
outcomes.
 Advantages:
 Foster group cohesiveness
 Aid performance measurement
 Disadvantages:
 Possible lack of fit with individualistic cultural values
 Free-riding effect
 Social pressures to limit performance
 Difficulties in indentifying meaningful groups
 Intergroup competition leading to a decline in overall
performance
 Team based performance plans are
likely to succeed when (Gomez-Mejia, Balkin & Cardy, 2012)
 Work tasks are so intertwined that it is difficult to single out who
did what
 Firm’s organization facilitates the implementation of team-based
incentives when:
 There are few levels in the hierarchy, & teams of individuals at the same
level are expected to complete most of their work with little dependence
on supervisors or upper management
 Technology allows for the separation of work into relatively self-
contained or independent groups
 Employees are committed to their work & are intrinsically motivated
 The organization needs to insist on group goals
 Team based incentives can help blend employees with diverse
backgrounds
 The objective is to foster entrepreneurship in self-managed work
 Plant-wide plans (Gomez-Mejia, Balkin & Cardy, 2012)
 Reward all workers in a plant or business unit
based on the performance of the entire plant or
unit
 Advantages:
 Productivity
 Efficiency
 Commitment
 Disadvantages:
 Protection
of low performers
 Problems with the criteria used to trigger rewards
 Management-labor conflict
Conditions favoring plantwide plans
(Gomez-Mejia, Balkin & Cardy, 2012)

 Firm size
 Technology
 Historical performance
 Corporate culture
 Stability of the product market
 Corporatewide plans (Gomez-Mejia, Balkin & Cardy, 2012)
 Reward employees based on the entire
corporation’s performance, e.g. profit sharing,
employee stock ownership plans, etc.
 Advantages:
 Financialflexibility for the firm
 Increased employee commitment
 Tax advantages
 Disadvantages:
 Employees may be at considerable risk as in ESOPs
 High exposure to macroeconomic forces
 Large effect on productivity
 Long-run financial difficulties
Conditions favoring corporatewide plans
(Gomez-Mejia, Balkin & Cardy, 2012)

 Firm size
 Interdependence of different parts of the
business
 Market conditions
 Presence of other incentives
Thank You
 Principles of HRM

Benefits
Aradhna Malik (PhD)
Assistant Professor
VGSoM, IIT Kharagpur
 Sources

Briscoe, D.R., Schuler, R. S. & Claus, L. (2009).

International human resource management:
Policies and practices for multinational
enterprises. NY: Routledge.
Gomez-Mejia, L. R., Balkin, D. B. & Cardy, R. L.
(2012). Managing human resources (7th Ed.).
New Delhi: PHI Ltd.
What? (Gomez-Mejia, Balkin & Cardy, 2012)
 Employee benefits: “Group membership
rewards that provide security for employees
and their family members.”
 Indirect compensation: “They are given to
employees in the form of a plan (such as
health insurance) rather than cash.”
Why? (Gomez-Mejia, Balkin & Cardy, 2012)
 Benefits issues are important to employees
 Benefits are a powerful recruiting tool
 Benefits help retain talented employees
 Certain benefits play a part in managerial
decisions
 Benefits are important to managers
Basic terminology (Gomez-Mejia, Balkin & Cardy, 2012)
 Contributions
 Coinsurance
 Copayment
 Deductible
 Flexible benefits program
Types of benefits (Gomez-Mejia, Balkin & Cardy, 2012)
 Legally required benefits
 Health insurance
 Retirement
 Insurance
 Paid time off
 Employee services
Benefits strategy (Gomez-Mejia, Balkin & Cardy, 2012)
 Benefits mix: “Complete package of benefits
that a company offers its employees.”
 Total
compensation strategy
 Organizational objectives
 Characteristics of the workforce
 Benefits amount
 Flexibility of benefits choice: “Degree of
freedom an employees have to tailor the
benefits package to their personal needs.
Corresponds to the ‘centralization versus
decentralization of pay’
Legally required benefits (Gomez-Mejia, Balkin & Cardy, 2012)
 Social security (US): Provides:
 “Income for retirees, the disabled, and survivors
of deceased workers
 Health care for the aged”
 Retirement income: Commonly known as
pension in India
 Medical care
 Survivor benefits: Pension schemes for
surviving dependent family members of
personnel killed in the line of duty
Workers’ Compensation (Gomez-Mejia, Balkin & Cardy, 2012)

 “Provides medical care, continuation, and

rehabilitation expenses for people who sustain job-
related injuries or sickness.”
 Management of workers’ compensation:
 Provision of safe work procedures
 Auditing claims of workers’ compensation
 Aligning workers’ compensation with health insurance
schemes of employees
 Ensuring safe work design to minimize work related injuries
 Provision of ‘modified duty plans’ for injured or temporarily
disabled personnel – e.g. permitting an employee flexible
work hours during recovery, or assigning shop floor workers
to desk jobs during recovery
 Unpaid Leave (Gomez-Mejia, Balkin & Cardy, 2012)
 Conditions:
 Personal reasons – family care, death in the family, etc.
 Further education
 Personal health issues
…
 Management of return to work after unpaid leave:
Laws vary by country
 Employment assured
 Re-assignment of work/ position equal to or higher than
the one at the time of proceeding on leave
 Receipt of unconditional pay raises, e.g. DA,
increments, etc.
 Voluntary benefits (Gomez-Mejia, Balkin & Cardy, 2012)
 Health Insurance: “Provides health care coverage for
both employees and their dependents.”
 Traditional health insurance: “Provided by an insurance
company that acts as an intermediary between patient and
health care provider”
 Health maintenance organization: “Health care plan that
provides comprehensive medical services for employees and
their families at a flat annual fee”
 Preferred provider organizations: “Health care plan in which an
employer or insurance company establishes a network of
doctors & hospitals to provide a broad set of medical services
for an annual flat fee per participant.”
 Health savings accounts: “Let individuals save money for a
qualified health plan that has a high deductible” Usually non
taxable. Prevalent in the US.
Managing health care benefits
(Gomez-Mejia, Balkin & Cardy, 2012)

 Develop a self-funding arrangement for health

insurance
 Coordinate health insurance plans for families
with two working spouses
 Develop a wellness program for employees
 Offer high deductible health plans for
employees
 Insurance plans (Gomez-Mejia, Balkin & Cardy, 2012)
 Life insurance: “…benefit to the survivors of a
deceased employee”
 Long term disability insurance: “Provides
replacement income to disabled employees
who cannot perform their essential job duties.”
 Paid time off (Gomez-Mejia, Balkin & Cardy, 2012)
 Sick leave: “Provides full pay for each day that
an employee experiences a short term illness
or disability that interferes with his or her ability
to perform the job.”
 Management of sick leave:
 “Wellness pay programs”: Incentives for people who
do not fall sick – Ethical issues ….
 Flexible working hours to help employees balance
work and personal lives and family needs
 Accruing sick leave as encashable leave
 Provision of casual leave
Paid time off (Contd.) (Gomez-Mejia, Balkin & Cardy, 2012)

 Vacations
 Severance pay: Golden handshake
 Holidays and other paid time off
Employee services (Gomez-Mejia, Balkin & Cardy, 2012)
 Services provided to employees to “…
enhance the quality of [their] work or personal
lives.”
 Types:
 Childcare
 Health club memberships
 Subsidized company cafeterias
 Discounts on company products
…
Administering benefits (Gomez-Mejia, Balkin & Cardy, 2012)
 Flexible benefits program: “Allows employees to
choose from a selection of employer provided benefits
such as vision care, dental care, health insurance, child
care, more paid vacation days, legal services, [etc.]”
Types:
 Modular plans: “Consist of a series of different bundles of
benefits or different levels of benefits coverage designed for
different employee groups.”
 Core plus options plans: “Consist of a core of essential
benefits and a wide array of other economic security for
employees, & usually includes basic health insurance, life
insurance, [etc.]”
 Flexible spending accounts: Individual employee accounts
funded by the employer, the employee, or both.
 Challenges with flexible benefits
(Gomez-Mejia, Balkin & Cardy, 2012)

 Adverse selection: “When an employee uses

a specific benefit more than the average
employee does.” e.g. vacation days or
cosmetic surgery, etc.
 Employees who make poor choices and later
regret
 Administrative complexity especially when
determining equivalence of various benefits
Benefits communication
(Gomez-Mejia, Balkin & Cardy, 2012)

 Challenges:
 Increasing complexity of benefits packages
 Employers reluctance to devote enough resources
to explain these complex packages to employees
Thank You
 Principles of HRM

Retirement & Separation

Aradhna Malik (PhD)
Assistant Professor
VGSoM, IIT Kharagpur
 Sources

Briscoe, D.R., Schuler, R. S. & Claus, L. (2009).

International human resource management:
Policies and practices for multinational
enterprises. NY: Routledge.
Gomez-Mejia, L. R., Balkin, D. B. & Cardy, R. L.
(2012). Managing human resources (7th Ed.).
New Delhi: PHI Ltd.
 Retirement benefits (Gomez-Mejia, Balkin & Cardy, 2012)
 Defined benefit plan: Pension
 Defined contribution plan: “Retirement plan in
which the employer promises to contribute a
specific amount of funds into the plan for each
participant.”
Employee separations (Gomez-Mejia, Balkin & Cardy, 2012)
 Concepts
 “Employee separation occurs when an employee
ceases to be a member of an organization.”
 “Turnover rate is a measure of the rate at which
employees leave the firm”
 Benefits
 Reduced labor costs
 Replacement of poor performance
 Increased innovation
 Opportunity for greater diversity
 Costs involved in employee separations
(Gomez-Mejia, Balkin & Cardy, 2012)
 Recruitment
 Advertising
 Campus visits
 Recruiter time
 Search firm fees
 Selection
 Interviewing & Testing
 Reference checks
 Relocation
 Training
 Orientation
 Direct training
 Trainer’s time
 Lost productivity during training
 Separation
 Separation pay & benefits
 Benefits
 Unemployment insurance cost
 Exit interview
 Outplacement assistance
 Vacant position
Types of separation (Gomez-Mejia, Balkin & Cardy, 2012)
 Voluntary separation: Occurs when an employee
decides, for personal or professional reasons, to end the
relationship with the employer.
 Quitting
 Retirement
 Involuntary separation: “Occurs when management
decides to terminate its relationship with an employee
due to (1) economic necessity, or (b) poor fit between
employee & the organization”
 “Discharge due to poor fit (poor performance or unacceptable
behavior)”
 “Layoff, downsizing & rightsizing due to necessity to cut costs
& improve efficiency by reallocation of responsibility among
Handling layoffs in small business
(Aubry, 2009, Karlin, 2010, & Robertson & Sullivan, 2010, in Gomez-Mejia, Balkin & Cardy, 2012)

 Be clear about the reason for the layoff

 Explain layoff criteria
 Take legal precautions
Implementing a layoff (Gomez-Mejia, Balkin & Cardy, 2012)
 Notifying employees ahead of time
 Developing layoff criteria
 Communicating to laid off employees as
sensitively as possible
 Coordinating media relations
 Maintaining security
 Reassuring survivors of the layoff
 Handling survivors of layoffs
(Gomez-Mejia, Balkin & Cardy, 2012)
 Reasons for survivor anxiety (Brink, 2008, Kennedy, 2005, & Atchison, 2009, in Gomez-

Mejia, Balkin & Cardy, 2012):

 More work
 Unsettling changes
 Self-assessment of contribution
 Guilt
 Depression
 Keeping up morale & performance of survivors (Marshall, 2005, in

Gomez-Mejia, Balkin & Cardy, 2012):

 What can you control

 Do you show appreciation to your employees & make work fun?
 Are you listening?
 Are you helping employees see the importance of their work?
Alternatives to Layoffs (Gomez-Mejia, Balkin & Cardy, 2012)

 Employment policies
 Reduction through attrition
 Hiring freeze
 Cut part-time employees
 Cut internships or co-ops
 Give subcontracted work to in-house employees
 Voluntary time off
 Leaves of absence
 Reduced work hours
 Changes in job design
 Transfers
 Relocation
 Job sharing
 Demotions
 Pay & benefits policies
 Pay freeze
 Cut overtime pay
 Use vacation & leave days
 Pay cuts
 Profit sharing or variable pay
One of the most acceptable alternative to
layoffs: Job sharing (Cascio, 2003)
 Advantages
 Availability
of complete pool of talent and creativity
 Continuation of benefits for everyone
 Reduction of overtime
 Retention of career orientation and potential for upward
mobility
 Elimination of the need for training temporary employees
 Disadvantages
 Perceived lack of job continuity
 Inconsistent supervision
 Accountability scattered/ divided among several
employees
 No reduction in non salary expenses
Unemployment Insurance (Gomez-Mejia, Balkin & Cardy, 2012)

 “Provision of temporary income for people during periods

of involuntary unemployment”
 Conditions for denial of unemployment insurance:
 “An employee who quits voluntarily
 An employee who is discharged for gross misconduct
 An employee who refuses an offer of suitable work”
 An employee who knowingly participates in activities that are
unlawful or that can legally be considered as being harmful for
the organization, or country or the public good
 Supplemental unemployment benefits: Additional
benefits provided at the time of layoffs – sometimes
referred to as the ‘golden handshake’, e.g. six months
salary when a person is laid off, etc.
Management of unemployment insurance
(Gomez-Mejia, Balkin & Cardy, 2012)

 Hiring short term employees during short term

or limited term crises
 Auditing all unemployment claims
 Conducting exit interviews with all discharged
employees to:
 “Come to a mutual understanding on the reason
for termination
 Advise them that the company will fight
unemployment claims not made for good reason”
Thank You
 Principles of HRM

Business Ethics
Aradhna Malik (PhD)
Assistant Professor
VGSoM, IIT Kharagpur
 Sources
Christy, R. & Christy, G. (2009). Ethics & human
resource management. In S. Gilmore & S.
Williams (Eds.). Human resource management
(Indian Edition). New Delhi: Oxford University
Press, 306-326.
Crane, A. & Matten, D. (2014). Business ethics
(3rd Ed.) (South Asia Edition). New Delhi:
Oxford University Press.
Gomez-Mejia, L. R., Balkin, D. B. & Cardy, R. L.
(2012). Managing human resources (7th Ed.).
New Delhi: PHI Ltd.
Business ethics & the law (Crane & Matten, 2014)
 “The law might be said to be a definition of the
minimum acceptable standards of behavior.”
 Business ethics is primarily concerned with
those issues not covered by the law, or where
there is no definite consensus on whether
something is right or wrong. Begins where the
law ends.
Defining morality, ethics and ethical
theory (Crane & Matten, 2014)
 Morality is concerned with the norms, values,
and beliefs embedded in social processes
which define right and wrong for an individual or
a community.
 Ethics is concerned with the study of morality
and the application of reason to elucidate
specific rules and principles that determine right
and wrong for a given situation.
 These rules are called ethical theories.
Relationship between morality,
ethics & ethical theory (Crane & Matten, 2014)
…to
Ethics …that can
produce
rationalizes be applied to Potential
ethical
Morality… any situation
theory… Ethical solutions
Morality Ethics
theory to ethical
problems
Why is business ethics important
(Crane & Matten, 2010)
 The power and influence of business in society is greater than ever
before
 Business has the potential to provide a major contribution to our
societies in terms of producing the products and services that we
want, providing employment, paying taxes, and acting as an engine
for economic development, etc.
 Business malpractices have the potential to inflict enormous harm on
individuals, communities and the environment
 The demands being placed on business to be ethical by its various
stakeholders are constantly becoming more complex and challenging.
 Few businesspeople have received formal business ethics education
or training
 Ethical violations continue to occur in business, across countries and
sectors.
 Differences in business ethics across
organizational types (Crane & Matten,2010)
Large Small Civil Society Public Sector
Corporations Businesses Organizations Organizations
Main priorities Financial Employee Delivery of mission to Rule of law,
in addressing integrity, issues clients; integrity of corruption,
ethical issues employee/ tactics; legitimacy & conflicts of
customer accountability interest; procedural
issues issues,
accountability
Approach to Formal, public Informal, Informal, values- Formal,
managing relations &/ or trust-based based bureaucratic
ethics systems-based

Responsible Shareholders & Owners Donors & clients General public,

&/ or other higher level
accountable to stakeholders government
organizations

Main Shareholder Lack of Lack of resources & Inertia, lack of

constraints orientation; size resources & formal training transparency
& complexity attention
Globalization & business ethics
(Crane & Matten, 2010)

“Globalization is a process which diminishes the

necessity of a common & shared territorial
basis for social, economic, & political activities,
processes, & relations”
Ethical issues in globalized businesses:
 Cultural issues: What is right in one culture may
not be right in another
 Legal issues
 Accountability
 Ethical impacts of globalization on different
stakeholder groups (Crane & Matten, 2010)
Stakeholders Ethical impacts of globalization
Share- Globalization provides potential for greater profitability, but also greater risks. Lack of
holders regulation of global financial markets, leading to additional financial risks & instability.
Employees Corporations outsource production to developing countries in order to reduce costs in
global marketplace – this provides jobs, but also raises the potential for exploitation of
employees through poor working conditions
Consumers Global products provide social benefits to consumers across the globe, but may also
meet protests about cultural imperialism & westernization. Globalization can bring
cheaper prices to customers, but vulnerable consumers in developing countries may
also face the possibility of exploitation by MNCs.
Suppliers & Suppliers in developing countries face regulation from MNCs through supply chain
competitors management. Small scale indigenous competitors are exposed to powerful global
players.
Civil society Global business activity brings the company in direct interaction with local
(NGOs etc.) communities thereby raising the possibility for erosion of traditional community life.
Globally active pressure groups emerge with aim to ‘police’ the corporation in
countries where governments are weak & corrupt
Government Globalization weakens governments & increases the corporate responsibility for jobs,
& regulation welfare, maintenance of ethical standards, etc. Globalization also confronts
governments with corporations from regions with different cultural expectations about
issues such as bribery, corruption, taxation, & philanthropy
Corporations & business ethics
(Crane & Matten,2010)
 Key features of a corporation:
 Corporations are typically regarded as ‘artificial persons’ in
the eyes of the law
 Corporations are nationally ‘owned’ by shareholders
 Managers & directors have a ‘fiduciary’ responsibility to
protect the investment of shareholders
 The debates:
 “Only human beings have a moral responsibility for their
actions”
 “It is the responsibility of managers to act solely in the
interests of shareholders”
 “Social issues and problems are the proper province of the
state rather than corporate managers”
The role of ethical theory (Crane & Matten, 2010)
 Ethical absolutism:
 There are eternal, universally applicable moral principles
 Right and wrong are objective qualities that can be rationally
determined
 Ethical relativism:
 Morality is context dependent and subjective
 There are no universal right and wrongs that can be
rationally determined – it simply depends upon the person
making the decision and the culture in which they are located
 Pluralism
 Accepts different moral convictions and backgrounds while
at the same time suggesting that a consensus on basic
principles and rules in a certain context can, and should, be
Normative ethical theories (Crane & Matten, 2010)
 The debates:
 Individual versus institutional morality
 Questioning versus accepting capitalism
 Justifying versus applying moral norms
 Western modernist theories: start with an assumption
about the nature of the world, and more specific
assumptions about the nature of human beings.
Normally provide us with a fairly unequivocal solution
to ethical problems.
 Non consequentialist
 Consequentialist: Moral judgment is based on the
outcomes, aims of goals of a certain action. Also referred
Major normative theories in business ethics
(Crane & Matten, 2010)
Egoism Utilitarianism Ethics of duties Rights and
Justice
Contributors Adam Smith Jeremy Immanuel Kant John Locke,
Bentham, John John Rawls
Stuart Mill
Focus Individual desires Collective Duties Rights
or interests welfare
Rules Maximization of Act/ rule Categorical Respect for
desires or self- utilitarianism imperative human beings
interest

Concept of Man as an actor Man is controlled Man is a rational Man is a being

human with limited by avoidance of moral actor that is
beings knowledge & pain & gain of distinguished by
objectives pleasure dignity
(hedonism)
Type Consequentialist Consequentialist Non- Non
consequentialist consequentialist
 Consequentialist theories (Crane & Matten, 2010)
 Egoism:
 “An action is morally right if the decision maker freely decides in order to
pursue either their (short-term) desires or their (long-term) interests
 Different from selfishness in that selfishness includes insensitivity to the
needs of the other
 Utilitarianism
 “An action is morally right if it results in the greatest amount of good for the
greatest amount of people affected by the action”
 Also called the greatest happiness principle because it focuses solely on the
consequences of an action, weighs the good against the bad results, and
finally encourages the action that results in the greatest amount of good for
all people involved
 Utility is measured in terms of a cost benefit analysis of pleasure & pain
(Hedonistic view) or happiness & unhappiness (Eudemonistic view)
 Problems:
 Subjectivity
 Quantification
 Distribution of utility
 Example of a utilitarian analysis in the case of
child labor (Crane & Matten, 2010)
Action 1: Doing the deal Action 2: Not doing the deal
Pleasure Pain Pleasure Pain
Product Good deal for the Bad Good conscience; Loss of a good
manager business; potential for conscience; less risk deal
personal bonus possible risk
for company
reputation
Thai Good deal Loss of a good
dealer deal; search for
new customer
Parents Secure the family’s Limited Search for other
income prospects for sources of income
children
Children Feeling of being Hard work; no No hard work; Potentially forced
needed, being ‘grown chance of time to play & go to do other, more
up’; approval of parents school to school painful work
education
Grand- Family is able to Loss of economic
mother support her support
 Principles of HRM

Ethical aspects of HRM activities

Aradhna Malik (PhD)
Assistant Professor
VGSoM, IIT Kharagpur
 Sources
Christy, R. & Christy, G. (2009). Ethics & human
resource management. In S. Gilmore & S.
Williams (Eds.). Human resource management
(Indian Edition). New Delhi: Oxford University
Press, 306-326.
Crane, A. & Matten, D. (2014). Business ethics
(3rd Ed.) (South Asia Edition). New Delhi:
Oxford University Press.
Gomez-Mejia, L. R., Balkin, D. B. & Cardy, R. L.
(2012). Managing human resources (7th Ed.).
New Delhi: PHI Ltd.
 Ethical aspects of HRM activities
(Christy & Christy, 2009)
 Whistleblowing : “…revealing unethical behavior by individuals or
organizations”
Whistle blowing is a good idea when:
 “… the firm, through its product or policy, [is likely to] do serious and
considerable harm to employees or to the public
 “… once employees identify a serious threat, they [are able to] report it
to their immediate superior & make their moral concern known”
 “… [the employee’s] immediate superior [has done] nothing effective
about the concern, [and] the employee [has exhausted] other internal
procedures and possibilities within the firm” before resorting to
whistleblowing
 “… [the employee has] documented evidence that would convince a
reasonable impartial observer that the company’s product or practice
poses a serious and likely danger to the public or user”
 “… the employee [has] good reasons to believe that, by going public,
he or she will ensure that the necessary changes will be brought about”
 Ethical aspects of HRM (Contd.)
(Christy & Christy, 2009)

 Employee rewards: Fair and objective systems

 Fairness & ‘Fat-cat’ pay: Issues regarding the
exorbitant salaries paid to senior officials/
consultants in light of the benefit their
contributions have brought to the organization
 Ethical aspects of HRM (Contd.)
(Christy & Christy, 2009)

 Implications of fairness in reward:

 Transparency
 Comprehensibility vs. complexity
 Equality of opportunity: Fairness and Justice: John Rawls
 Equal opportunity: Shareholder value perspective: “….it might be
expected that fair & open recruitment, training, & promotion
practices would make good sense from a business point of view.”
Any form of discrimination will eventually pull an organization
down
 The law of unintended consequences: “… being forced to behave
in a certain way means that the subsequent act is no longer one
of ethical choice”
 Equality of opportunity: Cultural considerations: Equality vs.
equitability of treatment based on culturally determined demands
Conflicting strategies for fair employment
(Gomez-Mejia, Balkin & Cardy, 2012)

 Fair employment vs. Affirmative action

 Fair employment: “…situation in which employment
decisions are not affected by illegal discrimination”
 Affirmative action: “… aims to accomplish the goal
of fair employment by urging employers to hire
certain groups of people who were discriminated
against in the past.”
 Discrimination (Gomez-Mejia, Balkin & Cardy, 2012)
 Meaning: “… making distinctions among
people”
 Types:
 Disparate treatment: “… occurs when an employer
treats an employee differently because of his or her
protected-class status.”
 Adverse impact or disparate impact: “… when the
same standard is applied to all employees, but that
standard affects the protected class more
negatively (adversely).”
Differences between disparate treatment &
adverse impact (Gomez-Mejia, Balkin & Cardy, 2012)
Disparate Treatment Adverse Impact
Direct discrimination Indirect discrimination
Unequal treatment Unequal consequences or results

Decision rules with a racial/ Decision rules with racial/ sexual

sexual premise or cause consequences or results
Intentional discrimination Unintentional discrimination
Prejudiced actions Neutral actions
Different standards for Same standards, but different
different groups consequences for different groups
Managing discrimination charges
(Gomez-Mejia, Balkin & Cardy, 2012)

 Demonstrate job relatedness as the reason for the

respective decision
 Bona fide occupational qualification: “… a characteristic
that must be present in all employees for a particular job.
e.g. PhD for faculty in institutes of higher education, or
perfect eyesight for pilots
 Seniority: System must be well established and
communicated to all employees as far ahead of time as
possible
 Business necessity: “… when the employment practice is
necessary for the safe and efficient operation of the
organization and there is an overriding business purpose
Reasonable accommodation for differently
abled employees (Gomez-Mejia, Balkin & Cardy, 2012)
 “Employers must make reasonable accommodation
for the known disabilities of employees”
 “Employers cannot deny a [differently abled] person
employment to avoid providing the reasonable
accommodation, unless providing the
accommodation would cause an undue hardship” or
unless the organization is physically or financially
unable to provide reasonable accommodation e.g.
equipment for paraplegic employees in India
 “No accommodation is required if the individual is not
otherwise qualified for the position.”
 Affirmative action plans
(Gomez-Mejia, Balkin & Cardy, 2012)
Steps:
 Utilization analysis:
 “Determining the demographic composition of the current workforce
by dividing all the jobs in the organization into classifications.”
 “Determining the percentage of those same protected classes in
the available labor market.”
8 factor availability analysis determines the percentage of protected
class members for:
“Local population, local unemployed workers, local labor force,
qualified workers in the local labor market, qualified workers in the
labor market from which you recruit, current employees who might
be promoted into the job classification, graduates of local education
and training programs that prepare people for this job classification,
& participants in training programs sponsored by the employer”
Steps in making affirmative action
plans continued (Gomez-Mejia, Balkin & Cardy, 2012)
 Goals and timetables: Should take into account:
 Sizeof underutilization
 How fast the workforce turns over
 Whether the workforce is growing or contracting
 Types of actions employer intends to take
Steps in making affirmative action
plans continued (Gomez-Mejia, Balkin & Cardy, 2012)
 Action plans: “…deciding exactly what affirmative actions
to take”
Some suggestions from the US system:
 “Recruiting protected class members
 Redesigning jobs so that the underrepresented workers are
more likely to be qualified
 Providing specialized training sessions for underprepared
applicants
 Removing any unnecessary barriers to employment”
 Challenge: Reverse discrimination: “Discrimination
against a nonprotected-class member resulting from
attempts to recruit & hire members of protected classes.”
Avoiding pitfalls in equal employment
opportunity (Gomez-Mejia, Balkin & Cardy, 2012)
 Provide training
 Establish a complaint resolution process
 Document decisions
 Be honest
 Ask only for information you need to know
Thank You
 Human Resources Management

Employee Health
Aradhna Malik (PhD)
Assistant Professor
VGSoM, IIT Kharagpur
 Sources
Cascio, W. F. (2003). Managing human resources: Productivity, quality of work life,
profits. New Delhi: Tata McGraw Hill.
Dickson-Swift, V., Fox, C. Marshall, K., Welch, N. & Willis, J. 2014). What really
improves employee health & well being: Findings from regional Australian
workplaces. International Journal of Workplace Health Management, 7(3), 138-
155.
Gilmore, S. & Williams, S. (Eds.) (2009). Human Resources Management (Indian
Edition). New Delhi: Oxford.
Gomez-Mejia, L. R., Balkin, D. B. & Cardy, R. L. (2012). Managing human
resources (7th Ed.). New Delhi: PHI Ltd.
Idris, M. A., Dollard, M. F. & Tuckey, M. R. (2015). Psychosocial safety climate as a
management tool for employee engagement and performance: A multilevel
analysis. International Journal of Stress Management, 22(2), 183-206.
Robbins, S. P., Judge, T.A. & Vohra, N. (2012). Organizational Behavior
(14th Ed.). New Delhi: Pearson.
Smith, S., Makrides, L., Lebel, F. S., Allt, J., Montgomerie, J., MacDonald,
M. J. & Szpilfogel, C. (2012). The healthy lifeworks project: The role of
organizational health in the personal health of employees. International
Journal of Workplace Health Management, 5(3), 196-209.
Psychosocial safety climate and psychological
health & well being in the workplace
(Idris, Dollard & Tuckey, 2015)

 “Psychosocial safety climate represents the priority

given to psychological health & well being in the
workplace.”
 Elements:
 Management support & commitment
 Management priority
 Organizational communication
 Organizational participation & involvement
 “If employees feel safe & not under threat, they are
likely to think that conditions are safe for them to take
risks to obtain more sources, learn new things & grow.”
 Work stress & its management
(Robbins, Judge & Vohra, 2012)

 Stress: Dynamic condition in which an individual is

confronted with an opportunity, demand, or resource
related to what the individual desires and for which the
outcome is perceived to be both uncertain and
important.

Types of stressors:
Challenge stressors: Stressors associated with
workload, pressure to complete tasks, and time
urgency
Hindrance stressors: Stressors that keep you from
 Potential sources of stress
(Robbins, Judge & Vohra, 2012)

 Environmental factors
 Organizational factors
 Personal factors
Sources of workplace stress (Smith et al, 2012)
 Stress: “Individual’s response to challenging or
difficult situations in their environment.”
 Sources:
 Workload not matched to employee capacities
 Work pace
 Career concerns
 Role conflict
 Interpersonal relationships
 Perceived job control – including availability of and
access to resources
 Emotional demands at work
Effects of psychological stress in the
workplace (Smith et al 2012)
 Individual level:
 Psychological well being of employees
 Depression
 Burnout
 Anxiety disorders
 Behavioral avoidance such as reduced affective commitment
 Increase in deleterious behaviors like smoking or alcoholism or
eating disorders
 Organizational level
 Increased compensation claims
 Increased intention to turnover
 Reduced productivity
 A model of stress Consequences

(Robbins, Judge & Vohra, 2012) Physiological

Potential sources Individual differences Symptoms
• Perception • Headaches
Environmental factors • Job experience • Hypertension
• Economic uncertainty • Social support • Heart disease
• Political uncertainty • Belief in locus
• Technological change Psychological
of control
• Self-efficacy Symptoms
Organizational • Anxiety
factors • Hostility
• Depression
• Task demands • Decreased job
• Role demands
Experienced stress satisfaction
• Interpersonal demands
Behavioral
Personal factors symptoms
• Family problems • Productivity
• Economic problems • Absenteeism
• Personality • Turnover
 Management of stress (Robbins, Judge & Vohra, 2012)
 At the Individual level
 Time management
 Physical exercise
 Relaxation techniques
 Delegation
 Cleaning up physical and psychological clutter
 Prioritizing
 Breaking up larger tougher goals into smaller
achievable goals
Management of stress (Contd.)
(Robbins, Judge & Vohra, 2012; Healy, 2000)

 At the Organizational level

 Training
 Goal setting
 Regular and appropriate feedback
 Redesigning jobs
 Increasing employee involvement
 Increasing formal organizational communication
with employees
 Organizationally supported wellness programs
 Flexi-times and telecommuting
Improving employee health &
well-being at the workplace
(Dickson-Swift, 2014)
 Workplace Health (Dickson-Swift, 2014)
 From the perspective of employers: “Workplace health
[includes] providing the conditions for personal
development & allowing individuals to become the
best they can be through opportunities provided to
them within the workplace.”
 From the perspective of employees: Workplace health
is much more a function of ‘emotional health, well-
being and happiness’ than physical health which can
be taken care of outside office. “Good emotional
health comes from working in a respectful place,
whereas poor emotional health can be caused by or
made worse by an unhealthy working environment.”
Factors affecting workplace health
(Dickson-Swift, 2014)

 Organizational culture
 Workplace Health Promotion programs
 Amenities
Organizational culture and its
influence on health (Dickson-Swift, 2014)
 Personal relationships
 Rewards
 Workplace flexibility
 Communication – perceived ease of
communication with superiors and subordinates
 Management support
 Physical spaces
Workplace Health Promotion Programs
(Dickson-Swift, 2014)

 What are WHP programs?: “Add-on programs often

about specific health topics that are run at work in or
outside normal working hours.”
 Examples: Health information sessions, fitness
programs, medical screening, training in personal and
life skills, ergonomics, first aid, bullying prevention,
manual handling, etc.
 Benefits: “Improvements in happiness, confidence,
job satisfaction, physical health, work ethic, healthy
behaviors such as increasing fruit & veg consumption
& decrease in alcohol intake, & gain in enthusiasm for
healthy choices, often shared with family members.”
Characteristics of preferred WHP
Programs (Dickson-Swift, 2014)
 Free
 Confidential
 Easy to participate in
 Enjoyable
 Make employees feel valued
 Offer opportunities for socializing
 Increase health & Well-being knowledge
 Increase motivation
 Develop personal skills
Characteristics preventing engagement
in WHP Programs (Dickson-Swift, 2014)
 Lacking in choice
 Lacking opportunities for staff engagement
 Lacking in management support
 Poorly timed
 Focussed on just provision of information
 Not targeted to specific issues
 Not targeted to specific audiences
 Repetitive

Amenities and workplace health &
well-being (Dickson-Swift, 2014)
 “Amenities […] include physical aspects of the
organization’s property such as a large staff
room with outdoor seating, child care center,
homework room for employees’ children,
comfortable chairs and opening windows”;
possibly a nice lunch room or employer
provided refreshments; possibly even a gym or
game room.
Safety, Health & Environment at the
Workplace (Govt. of India, 2009)
 Ministry of Labour and Employment,
Government of India:
http://labour.nic.in/content/innerpage/environme
nt-at-work-place.php
 National Policy on Safety, Health & Environment
at the Workplace (Government of India, 2009):
http://labour.nic.in/upload/uploadfiles/files/Policie
s/SafetyHealthandEnvironmentatWorkPlace.pdf
 Updated paper on NPSHE by Sardana: Institute
for Studies in Industrial Development, New
Thank You
 Human Resources Management

Organized Labor
Aradhna Malik (PhD)
Assistant Professor
VGSoM, IIT Kharagpur
 Sources

Gilmore, S. & Williams, S. (Eds.) (2009). Human

Resources Management (Indian Edition). New Delhi:
Oxford.
Gomez-Mejia, L. R., Balkin, D. B. & Cardy, R. L. (2012).
Managing human resources (7th Ed.). New Delhi: PHI
Ltd.
 Unions (Gomez-Mejia, Balkin & Cardy, 2012)
 “A union is an organization that represents
employees’ interests to management on issues
such as wages, work hours, and working
conditions.”
 Union dues are fees union members pay for the
services provided by the unions they are a part
of.
Employees join unions when they
(Gomez-Mejia, Balkin & Cardy, 2012)

 “…are dissatisfied with certain aspects of their

job
 Feel that they lack influence with management
to make the needed changes
 See unionization as a solution to their
problems”
Indian laws related to industrial relations
(Govt. of India)

 http://labour.nic.in/content/innerpage/industrial-r
elations.php
Labor relations (Gomez-Mejia, Balkin & Cardy, 2012)

 Labor relations strategy: “A company’s labor

relations strategy is its management’s overall
plan for dealing with unions.”
 Union acceptance strategy: “… management
chooses to view the union as its employees’
legitimate representative & accepts collective
bargaining as an appropriate mechanism for
establishing workplace rules.”
 Example of union acceptance strategy
(Gomez-Mejia, Balkin & Cardy, 2012, p. 514)
“Our objective is to establish a labor policy that is consistent and fair. The purpose
is to develop an agreeable working relationship with the union while retaining our
full management rights. The rationale behind our labor relations policy is
consistency, credibility, & fairness to union representatives, & the workers who are
in the union. In order to make our policy effective, the Company will:
Accept union representation of employees in good faith, provided the union
represents the majority of our employees
Maintain the right of management to manage
Adopt procedures by which top management continuously supports the positions
of its representatives in implementing the firm’s policies and practices in the area of
industrial relations
Enforce disciplinary policies in a fair, firm, and consistent manner
See to it that union representatives follow all Company rules except those from
which they are exempted under specific provisions of the labor contract
Handle all employee complaints fairly, firmly & without discrimination
See that every representative of management exercises a maximum effort to
follow Company policies fairly & consistently, and
See to it that all decisions and agreements pertaining to the present contract are
documented in writing.”
Union Avoidance Strategy (Gomez-Mejia, Balkin & Cardy, 2012)
 “Management selects a union avoidance
strategy when it fears that the union will have a
disruptive influence on its employees or fears
losing control of its workers to a union.”
 Approaches:
 Union substitution
 Union suppression
 Union substitution approach to union
avoidance strategy (Gomez-Mejia, Balkin & Cardy, 2012)
 “Also known as the proactive human resource management
approach: Management becomes so responsive to employees’
needs that it removes the incentive for unionization.”
 Representative policies:
 “Job security policies that protect the jobs of full-time workers. Among
these is a policy that subcontracted, temporary, and part-time workers
must be discharged before permanent employees can be laid off.
 Promoting-from-within policies that encourage the training &
development of employees
 Profit sharing & employee stock ownership plans that share the
company’s success with its employees
 High involvement management practices that solicit employee input into
decisions
 Open-door policies & grievance procedures that try to give workers the
same sense of empowerment that they would have under a union
Union suppression approach to union
avoidance strategy (Gomez-Mejia, Balkin & Cardy, 2012)
 “Management uses the union suppression
approach when it wants to avoid unionization at
all costs & does not make any pretense of
trying ‘to do the right thing’ for its employees.”
 Can backfire and cause employee-employer
conflict, loss of reputation, and high turnover
 Managing the labor relations process
(Gomez-Mejia, Balkin & Cardy, 2012)

 Union organizing
 Collective bargaining
 Contract administration
 Union organizing (Gomez-Mejia, Balkin & Cardy, 2012)
 “Takes place when employees work with a union
to form themselves into a cohesive group.”
 Issues:
 Union solicitation: Reach out to interested employees
in an attempt to woo them to joining the union
 Pre-election conduct of organization towards union
formation:
 Threats
 Intimidation
 Promises
 Surveillance of meetings
 Determining eligibility of candidates who can be voted
for
Collective bargaining (Gomez-Mejia, Balkin & Cardy, 2012)
 “Collective bargaining consists of negotiations
between an employer and a group of employees so as
to determine the conditions of employment. ” (Legal Information
Institute, Cornell University)

 Issues:
 Bargaining behavior: “Good faith bargaining means treating
the other party reasonably even when disagreements arise.”
 Bargaining power: Using the tactic (distributive or
integrative) that is likely to yield better results
 Bargaining topics: Issues important to both, the employees
and the Company. Could include ‘wages, hours, and
employment conditions’
 Impasses in bargaining: Dead ends or issues that remain
unresolved
 Bargaining etiquette
(Tyler 2005, Friedman, 2009, and Dolan 2011, in Gomez-Mejia, Balkin & Cardy, 2012)

 “Show courtesy to the other bargaining team

 Set the tone by being friendly to the other
bargaining team
 Maintain team solidarity
 Establish ground rules to deal with difficult
bargaining issues
 Keep negative emotions under control
 Exercise silence”
Bargaining power (Gomez-Mejia, Balkin & Cardy, 2012)
Tactics:
 Distributive: “Focuses on convincing your counterpart in
negotiations that the cost of disagreeing with your terms
would be very high.”
 “Labor [tends to use] distributive bargaining when it attempts to
convince management that it is willing and able to sustain a long
strike that will severely damage the company’s profits and weaken
the company’s position against its competitors.”
 “Management [tends to use] distributive bargaining when it tries to
convince the union that it can sustain a long strike much better than
union members, who will have to survive without their paychecks.”
 “Union leaders may also adopt distributive bargaining tactics when
they believe union members are willing to accept the cost of a long
strike that is likely to cause a vulnerable company severe economic
damage.”
Integrative bargaining
(Gomez-Mejia, Balkin & Cardy, 2012)

 “Focuses on convincing your counterpart in negotiations

that the benefits of agreeing with your terms would be
very high.” Win-win.
 Guidelines for effective bargaining (Lewicki, Saunders & Barry, 2006, Das &
Teng, 1998, in Gomez-Mejia, Balkin & Cardy, 2012) :

 “Attempt to understand the other negotiator’s real needs &

objectives
 Create a free flow of information
 Emphasize the commonalities, & minimize the differences
between the parties
 Search for solutions that meet both parties’ goals & objectives
 Develop flexible responses to the other negotiator’s proposals”
Bargaining topics (Gomez-Mejia, Balkin & Cardy, 2012)
 Mandatory Bargaining Topics: “Topics that both
union & management consider fundamental to
the organization’s labor relations.”
 Permissive Bargaining Topics: “May be
discussed during collective bargaining if both
parties have agreed to do so, but neither party
is obliged to bargain on these topics.”
 Illegal Bargaining Topics: Topics that at least
one party considers as an infringement of their
rights or detrimental to their existence, and that
 Impasses in Bargaining
(Gomez-Mejia, Balkin & Cardy, 2012)

 “If the parties cannot agree on one or more

mandatory issues, they have reached an
impasse in bargaining.”
 Ongoing, unresolved impasse can lead to strike
 Types of strikes (Gomez-Mejia, Balkin & Cardy, 2012)
 Sympathy strike: When one union goes on strike to
support another union in the industry, even if they are
not directly affected by the issue, just to show solidarity
 Economic strike: Strike over compensation including
salary and benefits
 Wildcat strike: “Spontaneous work stoppage […] when
workers are angered by a disciplinary action taken by
management against one of their colleagues.”
 Lockout: “When the employer shuts down its operations
before or during a bargaining impasse to protect
themselves from unusual economic hardship when the
timing of a strike may ruin critical materials.”
Contract Administration (Gomez-Mejia, Balkin & Cardy, 2012)

 “…involves application and enforcement of the labor

contract in the workplace.”
 Grievance procedure: “Systematic, step by step
procedure designed to settle disputes regarding the
interpretation of the labor contract
Advantages:
 “Provides the employee with an advocate dedicated to
representing the employee’s case to management – Union
steward”
 “Arbitration: A quasi-judicial process that is binding on both
parties…. Arbitrator is a neutral person selected form outside
the firm & compensated by both the union & management.”
 Steps in the grievance procedure
(Gomez-Mejia, Balkin & Cardy, 2012)

1. “Employee tells the union steward [and

immediate supervisor] about his/her grievance
orally”
2. Employee gives the grievance in writing to the
union steward and immediate supervisor in the
organization
3. Escalation to supervisor of supervisor and
union representative supervising union
steward
4. Arbitration
Types of grievances (Gomez-Mejia, Balkin & Cardy, 2012)
 Contract interpretation grievance: Deals with
ambiguity in the language of the labor contract
and any inconvenience caused due to this
ambiguity
 Grievance due to employee discipline: Deals
with the use of due process in dealing with
perceived indiscipline of employee
Benefits of union grievance procedures
(Gomez-Mejia, Balkin & Cardy, 2012)

 “Grievance procedure protects union employees

from arbitrary management decisions: it is the
mechanism for organizational justice.
 The grievance procedure helps management
quickly and efficiently settle conflicts that could
otherwise end up in the courts or result in work
stoppages
 Management can use the grievance procedure as
an upward communications channel to monitor &
correct the sources of employee dissatisfaction
with jobs or company policies.”
 Impact of unions on HRM
(Gomez-Mejia, Balkin & Cardy, 2012)

 Staffing
 Employee development
 Compensation
 Employee relations
Thank You
 Principles of HRM

International HRM
Aradhna Malik
Assistant Professor
VGSOM, IIT Kharagpur
 Sources

Briscoe, D.R., Schuler, R. S. & Claus, L. (2009).

International human resource management:
Policies and practices for multinational
enterprises. NY: Routledge.
Gomez-Mejia, L. R., Balkin, D. B. & Cardy, R. L.
(2012). Managing human resources (7th Ed.).
New Delhi: PHI Ltd.
The internationalization of business
(Briscoe, Schuler & Claus, 2009)

 Increased travel
 Rapid and extensive global communication
 Rapid development and transfer of new technology
 Free trade
 Education
 Migration
 Knowledge sharing
 Pressure on costs
 Search for new markets
 Homogenization of cultures

International orientation
(Briscoe, Schuler & Claus, 2009)

 Ethnocentrism
 Polycentrism or regiocentrism
 Geocentrism
 Internationalization of HRM
(Briscoe, Schuler & Claus, 2009)
 IHRM is the study and application of all human resource
management activities as they impact the process of
managing human resources in enterprises in the global
environment.
 Challenges to HRM in multinational enterprises (MNEs):
 Developing a global mindset inside the HR function, particularly
awareness and understanding of the new global competitive
environment and the impact it has on the management of
people worldwide
 Aligning core HR processes and activities with the new
requirements of competing globally, while simultaneously
responding to local issues and requirements
 Enhancing global competencies and capabilities within the HR
function
 The development of IHRM
(Briscoe, Schuler & Claus, 2009)

 Country selection
 Global staffing
 Recruitment and selection
 Compensation
 Standardization or adaptation
Differences between international
and domestic HRM (Briscoe, Schuler & Claus, 2009)
 More HR functions and activities
 A broader expertise and perspective
 More involvement in people’s lives
 Managing a much wider mix of employees
 More external factors and influences
 Greater risk
Creating the international organization:
Strategy & structure (Briscoe, Schuler & Claus, 2009)
 Opportunities available to firms in the global
environment:
 Adapting to local market differences
 Exploiting global economies of scale
 Exploiting global economies of scope
 Tapping into the best locations for activities &
resources
 Maximizing knowledge and experience transfer
between locations
Stages in the development of MNEs
(Briscoe, Schuler & Claus, 2009)

 Evolution of MNEs: Geographic spread: Bartlett

and Ghoshal (….) stages of internationalization
of companies:
 Domestic
 International
 Multinational
 Global
 Transnational
Stages in the development of MNEs
(Contd.) (Briscoe, Schuler & Claus, 2009)
 Internationalization through export
 International division or global product division
 Multi-country/ multi-domestic strategy
 Regionalization
 The global firm
 The transnational firm
 The born global firm
 The globally integrated enterprise
Choice of method for entry into
International Business (Briscoe, Schuler & Claus, 2009)
 Licensing and subcontracting
 Outsourcing
 Offshoring
 Wholly owned subsidiary:
 Greenfield: “Acquisition of an open (green) “field” in
order to build the subsidiary facilities from scratch”
 Brownfield: “Purchase of existing facilities (buildings) &
developing the subsidiary inside those facilities”
(sometimes referred to as a turnkey operation)
 “Acquisition of an existing enterprise that is already
established in the target country”
Choice of method for entry into International
Business (Contd.) (Briscoe, Schuler & Claus, 2009)
 Mergers and Acquisitions
 International Joint Ventures
 Strategic alliances, partnerships and consortia
 Maquiladoras (Mexican): Special form of
foreign subsidiary with special characteristics
favorable to foreign parents
 Principles of HRM

International HRM
Aradhna Malik
Assistant Professor
VGSOM, IIT Kharagpur
 Sources

Briscoe, D.R., Schuler, R. S. & Claus, L. (2009).

International human resource management:
Policies and practices for multinational
enterprises. NY: Routledge.
Gomez-Mejia, L. R., Balkin, D. B. & Cardy, R. L.
(2012). Managing human resources (7th Ed.).
New Delhi: PHI Ltd.
The internationalization of business
(Briscoe, Schuler & Claus, 2009)

 Increased travel
 Rapid and extensive global communication
 Rapid development and transfer of new technology
 Free trade
 Education
 Migration
 Knowledge sharing
 Pressure on costs
 Search for new markets
 Homogenization of cultures

International orientation
(Briscoe, Schuler & Claus, 2009)

 Ethnocentrism
 Polycentrism or regiocentrism
 Geocentrism
 Internationalization of HRM
(Briscoe, Schuler & Claus, 2009)
 IHRM is the study and application of all human resource
management activities as they impact the process of
managing human resources in enterprises in the global
environment.
 Challenges to HRM in multinational enterprises (MNEs):
 Developing a global mindset inside the HR function, particularly
awareness and understanding of the new global competitive
environment and the impact it has on the management of
people worldwide
 Aligning core HR processes and activities with the new
requirements of competing globally, while simultaneously
responding to local issues and requirements
 Enhancing global competencies and capabilities within the HR
function
 The development of IHRM
(Briscoe, Schuler & Claus, 2009)

 Country selection
 Global staffing
 Recruitment and selection
 Compensation
 Standardization or adaptation
Differences between international
and domestic HRM (Briscoe, Schuler & Claus, 2009)
 More HR functions and activities
 A broader expertise and perspective
 More involvement in people’s lives
 Managing a much wider mix of employees
 More external factors and influences
 Greater risk
Creating the international organization:
Strategy & structure (Briscoe, Schuler & Claus, 2009)
 Opportunities available to firms in the global
environment:
 Adapting to local market differences
 Exploiting global economies of scale
 Exploiting global economies of scope
 Tapping into the best locations for activities &
resources
 Maximizing knowledge and experience transfer
between locations
Stages in the development of MNEs
(Briscoe, Schuler & Claus, 2009)

 Evolution of MNEs: Geographic spread: Bartlett

and Ghoshal (….) stages of internationalization
of companies:
 Domestic
 International
 Multinational
 Global
 Transnational
Stages in the development of MNEs
(Contd.) (Briscoe, Schuler & Claus, 2009)
 Internationalization through export
 International division or global product division
 Multi-country/ multi-domestic strategy
 Regionalization
 The global firm
 The transnational firm
 The born global firm
 The globally integrated enterprise
Choice of method for entry into
International Business (Briscoe, Schuler & Claus, 2009)
 Licensing and subcontracting
 Outsourcing
 Offshoring
 Wholly owned subsidiary:
 Greenfield: “Acquisition of an open (green) “field” in
order to build the subsidiary facilities from scratch”
 Brownfield: “Purchase of existing facilities (buildings) &
developing the subsidiary inside those facilities”
(sometimes referred to as a turnkey operation)
 “Acquisition of an existing enterprise that is already
established in the target country”
Choice of method for entry into International
Business (Contd.) (Briscoe, Schuler & Claus, 2009)
 Mergers and Acquisitions
 International Joint Ventures
 Strategic alliances, partnerships and consortia
 Maquiladoras (Mexican): Special form of
foreign subsidiary with special characteristics
favorable to foreign parents
Factors influencing how MNEs organize
for global business (Briscoe, Schuler & Claus, 2009)

 Strategies
 Goals
 Environment
 Technology
 People
 Size
Factors influencing how MNEs organize for
global business (Contd.) (Briscoe, Schuler & Claus, 2009)
 Firm’s forms and stages of international development
 Amount of cross-border coordination required by the
firm’s strategy (I.e. degree of desired standardization
& centralization vs. degree of acceptable and/ or
necessary localization & decentralization)
 Nature of host governments’ involvement in the
economic process
 Diversity and complexity of the MNE’s business
operations
Stages of international involvement
(Gomez-Mejia, Balkin & Cardy, 2012)

 Stage 1: Primarily domestic market

 Stage 2: “Firm expands its market to include
foreign countries but retains is production
facilities within domestic borders”
 Stage 3: “Firm physically moves some of its
operations out of the home country”
 Stage 4: “Firm becomes a full fledged
‘multinational corporation … with assembly and
production facilities in several countries and
regions of the world”
Global employment law,
industrial relations, and
international ethics
The institutional context of international
business (Briscoe, Schuler & Claus, 2009)
 International organizations
 UN
 ILO
 OECD
 WB & IMF
 International trade organizations & agreements
 WTO
 NAFTA
 Mercosur/Mercosul
 Andean Community
 ASEAN
 APEC
 EU
The institutional context of international
business (Contd.) (Briscoe, Schuler & Claus, 2009)
 Commercial diplomacy
 Trade negotiations
 Impact of policy decision making
 Government regulations
 Legislation
 Standards
 Industrial subsidies
 Corporate conduct
Equivalent employment standards as stated
by various international organizations
(Briscoe, Schuler & Claus, 2009)

 Freedom of association (i.e. the right to organize and bargain

collectively)
 Equal employment opportunity and non-discrimination
 Prohibitions against child labor and forced (prison or slave)
labor
 Basic principles concerning occupational safety and health
 Consultation with workers’ groups prior to carrying out
substantial changes such as work force reductions and plant
closures
 Grievance or dispute resolution procedures
 Use of monitors (internal or external) to audit employment
practices
 MNEs and issues in IHRM
(Briscoe, Schuler & Claus, 2009)

 Understanding international labor standards and

regulations
 Conducting an analysis of the labor and employment
laws and practices in each of the countries within
which the MNE operates
 Determining the extent to which extraterritorial laws
apply especially for countries that have enacted such
laws
 Analyzing labor and employment issues that are
common to all MNEs such as problems with
adaptation to labor relations and local cultural
Extraterritorial laws (Briscoe, Schuler & Claus, 2009)
 Factors that govern the extent to which the
extent to which two operations are determined
to be integrated:
 The interrelations of their operations
 Common management
 Centralized control of labor relations
 Common ownership or financial control
Application of national law to local
foreign-owned enterprises (Briscoe, Schuler & Claus, 2009)
 Comparative law
 Immigration/ Visas
 Data privacy/ protection
 Anti-discrimination
 Termination and reduction in force
 Business closure
 Workplace closure
 Diminishing economic need for the work
 Intellectual property
International Labor Relations
(Briscoe, Schuler & Claus, 2009)
 International union membership
 Evolution of international labor relations and
organizations
 World Federation of Trade Unions (WFTU)
 International Confederation of Free Trade Unions
(ICFTU)
 International Trade Union Confederation (ITUC)
 European Trade Union Confederation (ETUC)
 World Confederation of Labor (WCL)
 Trade Union Advisory Committee (TUAC) of the OECD
 Global Union Federations (GUFs)
 In practical terms, unions view MNEs
as being able to (Briscoe, Schuler & Claus, 2009)
 Locate work in countries with lower social protections and lower
wages and benefits, staying away from countries with stronger
unions and stronger protections and higher wages and benefits
 Force workers in one country, faced by competition from workers
in other countries, to ‘bid down’ their wages and benefits to keep
their jobs
 Take advantage of differences in legally mandated benefits for
workers by restructuring the operations in countries where the
costs of work force adjustments are lowest and thus force
excessive dislocation burdens on workers in these low-benefit
countries
 Outlast workers in the event of a labor dispute in one country
because cash flows (and the ability to maintain business) are at
least partially maintained by operations in countries where there
 Obstacles to multinational bargaining
(Briscoe, Schuler & Claus, 2009)

 Diverse industrial relations laws and practices in

different countries
 Lack of any central, international authority for labor
relations or global labor law
 Major economic and cultural differences among
different countries
 Employer opposition
 Union reluctance at the national level, because the
national leadership often fears that multinational
bargaining will transfer power from them to an
international leadership
 Obstacles to multinational bargaining
(Contd.) (Briscoe, Schuler & Claus, 2009)
 Absence of a centralized decision-making authority for
unions
 Lack of coordination of activities by unions across
national boundaries
 Differing national priorities
 Employee unwillingness to subordinate local concerns
to the concerns of workers in other countries
Questions to be addressed during
global collaborations (Briscoe, Schuler & Claus, 2009)

 What rules will apply to the resolution of

disputes?
 What rules will apply to the process of
negotiations?
 What law will cover the negotiations, e.g.
between companies in two or more countries?
 Multinational enterprises and labor
relations: Approaches (Briscoe, Schuler & Claus, 2009)

 Hands off: Local managers handle everything

 Monitor: Local managers handle everything but report to
senior management who keep a tab on things
 Guide and advise: Constant advice from central
management to local management
 Strategic planning: Global strategy governs local operations
and management
 Set limits and approve exceptions: Very limited freedom of
action. Exceptions need to be approved by headquarters.
 Managing totally from headquarters
 Integration of headquarters IHR and line management in the
field: Global strategy works hand in hand with local mgmt.
Issues of concern to local union environments
(Briscoe, Schuler & Claus, 2009)
 Existing trade unions
 Level of organization
 Focus breadth
 Affiliations
 Type of workers
 Union density
 Focus of labor relations
 Negotiation partner
 Employers associations
 Operation method
 Issues typically covered by union agreements
 Binding force of union agreements
 Strikes and industrial action

 International Labor Relations (Contd.)
(Briscoe, Schuler & Claus, 2009)
 Works councils:
 Made up of elected representatives of the firm’s work force
 Have the right to receive information and consultation relative to
many decisions a firm makes
 Co-determination
 Legal requirement in which employees are represented on
supervisory boards or boards of directors and participate in major
strategic decisions – agreement of employees required
 Systems of co-decisions
 Dual system: Supervisory board (consisting of 1/3 employees)
supervises the board of directors
 Single tier system: Only one board of directors & employees have
one or two representatives
 Mixed system: with obligatory participation of employees but only an
advisory role
International Labor Relations (Contd.)
(Briscoe, Schuler & Claus, 2009)

 Litigation risks in global labor relations

 Development of a strategic global industrial
relations policy
International framework of ethics
(Briscoe, Schuler & Claus, 2009)
 Ethical relativism to ethical absolutism
 Bribery and corruption:
 Some countries consider bribery to be an
acceptable business practice
 Mexico: La mordida
 South Africa: Dash

 Middle East, India & Pakistan: Bakhsheesh

 Germany: Schimmengelt

 Italy: Bustarella
 Challenges to
International HRM
International HR Information Systems
(Briscoe, Schuler & Claus, 2009)

 Computer programs that help manage HR related data

 Problems:
 Keeping track of work forces in each country of operation
 Keeping track of long-term international assignees,
including home country contact information as well as
foreign addresses, etc.
 Keeping track of short-term international assignees who
may be commuting, on extended business trips or on
assignment that last only a few months
 Keeping track of international assignee compensation &
benefits packages in some form of comparable information,
since most international assignees have unique
compensation packages
Problems with International HR Information
Systems (Briscoe, Schuler & Claus, 2009)
 Providing identification numbers for all employees around the
globe (and a way to standardize these, since many countries
have their own identification numbers
 Having multilingual capabilities & fields that accommodate
diverse requirements (length of names, addresses, multiple
spouses, etc.)
 Foreign currency conversions for payroll, which can vary daily
 Standard formatting for compensation & benefits variations
from country to country
 Budgeting & tracking payroll, given various currencies &
currency fluctuations
 Government vs. private health & pension benefits in various
countries
Problems with International HR Information
Systems (Contd.) (Briscoe, Schuler & Claus, 2009)
 Major variances in leave of absence & paid time off from
country to country (even standard definition of what
constitutes time off & when someone is included in the
active head count)
 Employment contracts (with their major variances from
country to country)
 No. of hours worked & vacation days
 Termination liabilities
 Tracking visas (for various types of international assignees
& families & business travellers, schedules for renewal, etc.)
 Tracking family information for international assignees,
including educational support
Problems with International HR Information
Systems (Contd.) (Briscoe, Schuler & Claus, 2009)
 International job postings – locations, timing, job
responsibilities, applicable employment contracts
 Terms & conditions of employment variances from
country to country
 Keeping track of all the firm’s union contracts & their
variances
 Data privacy laws that protect personal information
residing in HR Information Systems & the backup
systems(often in another country)
 Laws regarding the transfer of personal data from
one country to another
 Global HR Challenges (Briscoe, Schuler & Claus, 2009)

 Not enough opportunities perceived to be in HR

because of higher priority to other aspects of
businesses
 Increased no. of employee relations issues
 Globalization and freer trade are leading many
countries to change their legal frameworks,
which impacts International HR practices &
local country management
 There is very little consistency in HR
infrastructure for delivery of International HR
 Global HR Challenges (Contd.)
(Briscoe, Schuler & Claus, 2009)

 What employees want in various locations

around the world is constantly changing & often
creates new & difficult challenges:
 Global work forces want top level leadership from
within their own countries not just from
headquarters
 Local work forces & local HR staffs want their local
office dynamics to be respected by corporate
headquarters
 Local subsidiary & joint venture managements want
expatriates to take ownership of becoming part of
the country they are assigned to.
Continuous change in needs of employees
worldwide (Contd.) (Briscoe, Schuler & Claus, 2009)
 Local employees want defined career paths for
themselves & want to be included in corporate career
planning, as well. They expect the parent firm to initiate
development opportunities for local employees.
 Local offices often feel left out of corporate planning
 Local business units expect to be included in executive
visits from headquarters, not to be taken for granted
 Employees in foreign subsidiaries around the globe
want:
 Variable compensation schemes to include them
 To be included in parent company decisions regarding total
 Challenges to IHR functions in evolving
multinational enterprises (Briscoe, Schuler & Claus, 2009)
 True globalization and standardization of IHR functions
 Global redistribution & relocation of work due to changing
organizational design
 Absorption of acquired businesses, merging of existing
operations on a global scale, staffing of strategic integration
teams, & attempts to develop & harmonize core HR
processes within these merged businesses
 Rapid start-up of international operations & organization
development as they mature through different stages of the
business cycle
 Changing capabilities of international operations with
increased needs for up-skilling of local operations & greater
 Challenges to IHR functions in evolving
MNEs (Contd.) (Briscoe, Schuler & Claus, 2009)
 Need to capitalize on the potential of technology to facilitate
HR functions, while ensuring that social & cultural insights are
duly considered when required
 Changes to the need of intermediaries in HR service supply
chain due to increased dependence on web-based HR related
services
 Articulation of appropriate pledges about the levels of
performance that can be delivered to the business by the IHR
function, & the requirement to meet these pledges under
conditions of tight cost control
 Learning about operating through formal or informal global HR
networks, acting as knowledge brokers across international
operations, & avoiding a “one best way” HR philosophy
 Challenges to IHR functions in evolving
MNEs (Contd.) (Briscoe, Schuler & Claus, 2009)
 Offering a compelling value proposition to the
employees of the firm, & understanding & then
marketing the brand that the firm represents across
global labor markets that in practice have different
values & different perceptions
 Identification of problems faced by HR professionals
as they experience changes in the level of
decentralization/ centralization across constituent
international businesses.
Opportunities for strengthening International
HR (Briscoe, Schuler & Claus, 2009)
 Professionalization of International HR
 Global HR certification: Human Resource Certification
Institute (HRCI) - http://www.hrci.org/
 Society for Human Resource Management:
http://www.shrm.org/pages/default.aspx
 Narrowing the international HR competency gap
 Development of organizational initiatives that can
effectively attract, retain, & engage employees on a
global scale who can achieve the organization’s
strategic global objectives
 Developing international HR sustainability
 International HR Jobs of the future
(Briscoe, Schuler & Claus, 2009)

 Ability to educate & influence line managers on IHR

policies, practices & importance
 Being computer & technology-literate, so as to be
able to create & use global databases for IHR advice
& decision making & delivery worldwide of IHR
transactional services
 Being able to anticipate internal & external changes,
particularly of importance to the availability &
qualification of HR talent around the world
 Exhibiting leadership for the IHR function & within the
corporation, at headquarters level & at the business
International HR Jobs of the future (Contd.)
(Briscoe, Schuler & Claus, 2009)

 Focusing on the quality of IHR services within the

enterprise
 Defining an IHR vision of the future &
communicating that to the IHR department & to the
organization
 Developing broad knowledge of many IHR functions
 Being willing to take appropriate risks in the
development & implementation of innovative IHR
policies & practices
 Being able to demonstrate the financial impact of
IHR policies & practices
 What must the IHR department do
(Briscoe, Schuler & Claus, 2009)

 Hire people with international experience as far as possible

 Disperse people with international experience throughout
the firm
 Learn how to recruit and assign on a global basis
 Increase the firm’s international information inputs
 Train everyone in cross-cultural communication, etiquette,
protocol, negotiation styles & ethics
 Ensure international developmental assignments
 Pursue Global Programs in HR certification
 Understand and appreciate the importance of developing
themselves to better carry out the global objectives of the
organization
Thank You
Human Resource Management
Strategic HRM
Aradhna Malik (PhD)
Assistant Professor
VGSoM, IIT Kharagpur
 Sources
Barney, J. B. & Wright, P. M. (1997). On becoming a strategic partner:
The role of human resources in gaining competitive advantage. CAHRS
Working Paper Series. 4-1-1997, WP # 97-09. Cornell University.
Gomez-Mejia, L. R., Balkin, D. B. & Cardy, R. L. (2012). Managing human
resources (7th Ed.). New Delhi: PHI Ltd.
Hall, D. (2009). Managing performance. In S. Gilmore & S. Williams (Eds.).
Human Resource Management (Indian Edition). New Delhi: Oxford.
139-167.
Lengnick-Hall, C. A. & Lengnick-Hall, M. L. (1988). Strategic human
resources management: A review of the literature and a proposed
typology. The Academy of Management Review, 13(3), 454-470.
Schuler, R. S. & Jackson, S. E. (1987). Linking competitive strategies with
human resource management practices. Academy of Management
Executive, 1(3), 207-219.
Wright, P. M. & McMahan, G. C. (1992). Theoretical perspectives for
strategic human resource management. Journal of Management, 18(2),
What is strategic HRM? (Lengnick-Hall & Lengnick-Hall,
1988, Wright & McMahan, 1992)

 Management of a firm’s human resources in such a way so

as to achieve strategic objectives of the firm.
 “SHRM is concerned with ensuring that ‘human resources
management is fully integrated into strategic planning; that
HRM policies cohere both across policy areas and across
hierarchies & that HRM practices are accepted and used by
line managers as part of their everyday work.” (Guest, 1989, in Wright &
McMahan, 1992)

 “All those activities affecting the behavior of individuals in

their efforts to formulate and implement the strategic needs
of the business.” (Schuler, in Wright & McMahan, 1992)
 “The pattern of planned human resource deployments and
activities intended to enable an organization to achieve its
Why strategic HR? (Lengnick-Hall & Lengnick-Hall, 1988)
 To help a firm achieve competitive advantage,
“… by lowering costs, by increasing sources of
product and service differentiation, or by both”
Competitive strategies (Schuler & Jackson, 1987)
 Strategic initiative: “Ability to capture control of
strategic behavior in the industries in which a
firm competes.”
 Competitive strategies that can be used to gain
competitive advantage:
 Innovation strategy: “…used to develop products or
services different from those of competitors […]
offering something new and different”
 Enhancement strategy: “”Enhancing product and/or
service quality”
 Cost reduction strategy: “… being the lowest cost
 Strategic theories of HRM (Wright & McMahan, 1992)
 Resource based view of the firm:
 “Competitive advantage can only occur in situations
of firm resource heterogeneity and firm resource
immobility (inability of competing firms to obtain
resources from other firms)”
 “…given resource heterogeneity and resource
immobility and satisfaction of the requirements of
value, rareness, imperfect imitability, and non-
subtitutability, a firm’s resources can be a source of
sustained competitive advantage.”
 Strategic theories of HRM (Contd.)
(Wright & McMahan, 1992)

 The behavioral perspective:

 “… focuses on employee behavior as the mediator
between strategy and firm performance”
 “…assumes that the purpose of various employment
practices is to elicit and control employee attitudes and
behaviors. The specific attitudes and behaviors that will
be most effective for organizations differ, depending
upon various characteristics of organizations, including
the organizational strategy. In the context of SHRM,
these differences in role behaviors required by the
organization’s strategy require different HRM practices
to elicit and reinforce those behaviors.”
 Behavioral perspective (Contd.)
(Wright & McMahan, 1992)
Schuler and Jackson’s Model for linking HRM practices with firm performance

Business Needed HRM Actual Role

Characteristics Role Practices Behaviors
Behaviors

Role Role
Information Information
Employee role behaviors for competitive
strategies (Schuler & Jackson, 1987)
 Predictability vs. creativity and innovation
 Short-term vs. long-term focus
 Cooperation and interdependence vs. independence and
autonomy
 Concern for quality and quantity
 Risk taking ability and orientation
 Concern for process
 Avoiding vs. assuming responsibility
 Flexibility to change
 Preference for stability vs. tolerance of ambiguity and
unpredictability
 Range of skill application

 Strategic theories of HRM (Contd.)
(Wright & McMahan, 1992)

 Cybernetic Systems:
 “…organizations consist of the patterned activities of
individuals aimed at some common output or outcome.
These activities can be characterized as consisting of
the energic input into the system (i.e. inputs of people,
money, technology, etc.), the transformation of energies
within the system (i.e., putting the inputs to work
together), and the resulting product or energic output
(i.e., the product that results from the patterned activities
of the input and throughput phases.”
 “…negative feedback loop informs the system that it is
not functioning effectively, thereby allowing for changes
to reduce any discrepancies.”
Cybernetic model of HR Systems
(Wright & McMahan, 1992)

Input Throughput Output

HR HR Behaviors Productivity,
Knowledges, Satisfaction,
Skills, & Turnover, etc.
Abilities

Firm Strategy
 Cybernetic model (Contd).
(Wright & McMahan, 1992)

 Inputs: “Competencies of the individuals in the

organization that the firm must import from its
external environment.”
 Throughput: “Behaviors of those individuals in
the organizational system.”
 Outputs: “Consist of both performance and
affective outcomes.”
 Cybernetic model (Contd).
(Wright & McMahan, 1992)

 Responsibilities of SHRM:
 Competence management: “Those things that the organization
does to ensure that the individuals in the organization have the
skills required to execute a given organizational strategy.”
 Competence acquisition: “Refers to the activities such as training &
selection that seek to ensure that the individuals in the organization have
the required competencies.”
 Competence utilization deals with activities that seek to utilize latent
skills or skills that had been deemed unnecessary under a previous
strategy.”
 Competence retention is a strategy aimed at retaining various
competencies in the organization through reduction of turnover &
constant training.”
 “Competence displacement consists of activities aimed at eliminating
competencies that are no longer necessary for the organizational
strategy.”
Responsibilities of SHRM (Contd.)
(Wright & McMahan, 1992)

 Behavior management: “Concerned with

ensuring that once individuals with the required
skills are in the organization, they act in ways
that support the organizational strategy.”
 Behavioral control: “Activities such as performance
appraisal & pay systems that seek to control
employee behavior to be in line with organizational
goals.”
 Behavioral coordination: “Appraisal and
organizational development activities that seek to
coordinate behavior across individuals to support the
Strategic theories of HRM (Contd.)
(Wright & McMahan, 1992)

 Agency/ Transaction cost theory:

 “Transaction costs are the costs associated with negotiating,
monitoring, evaluating and enforcing exchanges between parties,
and they are incurred in order to make exchanges more efficient.”
 “Agency problem exists when one party requires services from
another in a situation where uncertainty exists and both parties will
behave self-interestedly.”
 “Agency costs are the costs associated with establishing efficient
contracts between parties.”
 “The central premise of the transaction cost approach is that
employees have strong incentives to shirk (reduce their
performance) and free-ride (rely on the efforts of others in the
group) and no incentive to increase their performance, unless task
conditions allow employees to demonstrate their unique
Competitive strategy of a firm is
dependent upon (Lengnick-Hall & Lengnick-Hall, 1988)
 Economic conditions
 Industry structure
 Distinct competence
 Competitive Advantage
 Product/ Market scope
Human resource strategy is dependent
upon (Lengnick-Hall & Lengnick-Hall, 1988)

 Labor market
 Skills and values
 Economic conditions
 Culture
 Non strategic models of HRM
(Wright & McMahan, 1992)

 “Determinants of HRM practices that are not the

result of rational strategic decision making
processes, but rather derive from institutional &
political forces in the firm.”
 Resource dependence/ power models:
 “Assumes that all organizations depend on a flow of
valuable resources into the organization in order to
continue functioning. The ability to exercise control over
any of these valued resources provides an individual or
group with an important source of power. To the extent
that the valued resource is scarce, the power of the
entity that controls that resource increases.”
Non strategic models of HRM (Contd.)
(Wright & McMahan, 1992)

 Institutionalism or Institutional perspective:

 “Many structures programs & practices in
organizations attain legitimacy through the social
construction of reality.”
 Premises:
 “What many view as rationally derived organizational
structures & practices may only appear to be so
 Structures may serve some functional goal, although they

had not been designed for that particular purpose.”

 Institutional perspective (Contd.)
(Wright & McMahan, 1992)
 Ways of institutionalizing practices:
 Coercion
 “Practices can be authorized or legitimized through an
organization voluntarily seeking approval of a superordinate
entity, e.g. accreditation”
 “Practices can be induced through outside agents providing
rewards to organizations that conform with the wishes of the
agent.”
 “Practices can be acquired through one organization
modeling its practices based on practices of other
organizations as a means of appearing legitimate or up-to-
date”
 “Imprinting: […] the practices adopted at the beginning of the
Thank You
Human Resource Management
Strategic HRM (Contd.)
Aradhna Malik (PhD)
Assistant Professor
VGSoM, IIT Kharagpur
 Sources
Jiang, K., Takeuchi, R. & Lepak, D. P. (2013).
Where do we go from here? New perspectives
on the Black Box in strategic human resource
management research. Journal of Management
Studies, 50(8), 1448-1480.
Swart, J., & Kinnie, N. (2014). Reconsidering
boundaries: Human Resource Management in
a networked world. Human Resource
Management, 53(2), 291-310.
 Multilevel model of strategic HRM
(Jiang, Takeuchi & Lepak 2013)

Organizational Organizational human capital Organizational

level HR systems Organizational motivation states outcomes
Organizational involvement

Bottom up process
Top-down process

Team level Team human capital

Team
HR systems Team motivation states
outcomes
Team involvement

Employee Individual KSAOs Employee

perceived Individual motivation outcomes
HR systems Individual opportunity to perform

Mediation process
 Strategic HRM:
Implications for the
future
Strategic HRM in a networked world
(Swart & kinnie, 2014)

 Management of human capital and relational

capabilities of the firm
 Focuses on “…development of skills that
facilitate relationship building & specifically,
team-based effectiveness”
 Defining characteristics:
 Buffering model – Fluidity
 Borrowing model – “Leveraging experience at the
level of the network”
 Balancing model – “Duality of membership & HRM
Challenges of networked organizations
(Swart & Kinnie, 2014)
 “Networked working [is] the co-creation of
products and services that have economic
value for stakeholders extending beyond the
boundaries of a single organization.”
 “…need to consider how suppliers, partner,
clients and customers influence the way in
which people are managed.”
Networked working (Contd.) (Swart & Kinnie, 2014)
 Individual perspective:
 “Identitiesof ‘employees’ in [the] liminal space
(space between the connection employees have to
their organizations and their clients) are formed
through a dialogue between themselves & the
parties with whom they interact.”
 Challenges:
 “Multiple time target demands from various stakeholders
placed on the individuals which may create both
synergies (creation of value for both) and conflicts.”
 Emotional pulls from both sides

 Sense of commitment
 Types of networks (Swart & Kinnie, 2014)
 Interactive networking:
 “Organizations work with partners & suppliers to provide
products & services to clients.”
 “Aim is to meet the needs of clients by actively engaging
with network partners while ‘protecting’ firm-specific skills,
often via strong commitment to the organization.”
 Characteristics: “Frequent interaction between various
stake-holders at senior levels within each partner”
 Tensions:
 “Establishment of internal employment practice equity”
 “Management of boundary between its own HRM practices and
network partners’ employment practices”
 “Ambiguous power relationships & client demands”
 Provision of most updated specialized knowledge vs. creation of
new knowledge that can be sold through expensive
experimentation – who absorbs the costs?
 Types of networks (Contd.) (Swart & Kinnie, 2014)
 Interwoven networking: “Collaboration of
several firms to produce a particular network
level output.” e.g. film production, consulting,
construction of a bridge/ apartment complex/
mall, etc.
 Relational tensions include, “Agreement of outputs,
collaboration, decision regarding the ‘best’
professional solution and the most cost-effective
solution, organizational commitment, access to
scarce resources, trust, keeping employment costs
down, etc.”
Types of networks (Contd.) (Swart & Kinnie, 2014)
 “Aim […] is concerned with improving the
performance of the network [e.g.] sharing best
practices”
 Tensions:
 Knowledge sharing vs. loss of competitive
advantage
 Power struggles regarding ownership and decisions
regarding direction of work.
 HRM Models in a networked context
(Swart & Kinnie, 2014)

 Models discuss “…how HRM practices are

used to manage networked tensions identified
earlier”
 Models:
 Bufferingthe network
 Borrowing from the network
 Balancing the network
Buffering the network: Human Capital Agility
(Flexible resourcing model) (Swart & Kinnie, 2014)
 “HRM practices exist at the level of the firm.
 “Firms […] retain flexibility to respond to changing network
demands while anchoring knowledge and specialist skills within
the organizational boundaries”
 “Achieved by linking HRM systems to organizational values,
which illustrates awareness of the intensity of the opportunities
to join a collaborator or a client in a cross-boundary setting”
 “Relationships are described as the most important criteria for
staff allocation to teams”
 Focus on “…development of a broad range of skills”
 “Performance management & reward systems are linked with
cultural and strategic objectives that strengthen commitment to
the organization”
 Borrowing from the network: Leveraging
complementarity (Swart & Kinnie, 2014)
“HRM practices exist at the level of the firm with some practices,
such as resourcing, emergent at the level of the network”
“Focus on the development of complementary skills, which will
benefit the network while leveraging the learning to benefit the
individual & the firm.”
Complex internal resourcing process due to continuous “tensions
between pursuing a deep expertise approach which involves keeping
project teams together over long periods, & providing employees
with new opportunities for challenging work.”
“Development is focused on deepening professional skills that
enable future business winning.”
“High degree of involvement [of employees] in networked activities.”
Sustenance of network depends upon “relationship building &
opportunities for involvement”
 Balancing the network: Multidimensional agility
(Swart & Kinnie, 2014)
 “Portfolio of HRM practices exists at the level of the network
& within the firm”
 “Balance between strong social relationships & network level
processes”
 Talent management – one of the primary goals in sharing of
best practices
 “Performance management practices are generally
established at the level of the network with efficiency targets
set for each firm and performance measured weekly.”
 Result:
 “Generation of flexible human capital, which can be effectively
deployed across the network as well as within the individual
firms.”
 “Cost saving & […] further networked ways of working”
Thank You
Human Resource Management
Strategic HRM (Contd.)
Aradhna Malik (PhD)
Assistant Professor
VGSoM, IIT Kharagpur
 Sources
Gerpott, F. H. (2015). The right strategy?
Examining the business partner model’s
functionality for resolving Human Resource
Management tensions and discussing
alternative directions. Zeitschrift für
Personalforschung, 29(3-4), 214-234.
Kramer, R. (2014). Beyond strategic human
resource management: Is sustainable human
resource management the next approach? The
International Journal of Human Resource
Management, 25(8), 1069-1089.
Paradoxical tensions in HRM (Gerpott, 2015)
 “Paradoxes are defined as contradictory yet
interrelated elements that exist simultaneously and
persist over time”
 “Paradoxical tensions constitute the states &
phenomena caused by the two opposing poles of
paradoxes.”
 “HRM professionals are struggling with the tension
between the high appreciation they feel they are
eligible for because they manage employees as
organizations’ most important competitive resource
& the low status HRM professionals actually receive
as administrative staff in companies.”
Categories of paradoxical tensions
in HRM (Gerpott, 2015)
 Tensions of identity: Employee advocate vs.
‘Ward of managers’
 Tensions of learning: “When should HRM gain
new knowledge?” – Stability vs. change
 Tensions of organizing: “How should HRM
organize processes?” – Retention of processes
vs. delegation
 Tensions of performing: “What are the primary
goals of HRM?” Operational vs. strategic
Coping strategies (Poole & Van de Ven in Gerpott, 2015)
 “Spatial separation: Allocating the different
poles of a tension across different
organizational units”
 “Temporal separation: Choosing the poles of a
paradox one after another in different time
periods”
 “Synthesis: Reducing tensions verbally through
abstraction or actively through the
accommodation of the opposing poles”
 Sustainable HRM (Ehnert 2009, in Kramar, 2014)
 “Sustainable HRM is the pattern of planned or
emerging human resource strategies and practices
intended to enable a organizational goal
achievement while simultaneously reproducing the
HR base over a long-lasting calendar time and
controlling for self induced side and feedback
effects on the HR systems on the HR base and
thus on the company itself.”
 “”Sustainable HR assumes that an organization is
an open system that needs to develop &
regenerate its HRs at least as fast as it consumes
them.”
 Objectives of sustainable HRM
(Ehnert, 2006, in Kramar, 2014)

 “To balance the ambiguities & duality of

efficiency & sustainability over a long-lasting
calendar year
 To sustain, develop & reproduce an
organization’s human & social resource base,
e.g. help the mutual exchange relationships, &
 To evaluate & assess negative effects of HR
activities on the HR base & on the sources for
HR”
 Sustainable HRM Model (Ehnert, 2009, in Kramar, 2014)
Socioeconomic, ecological, institutional & technological contexts
Sustainability
Interpretations
Organizational
context Strategy Normative Efficiency Substance

Organizational effects

HRM Strategy
Source of HR Human
(origin of HR) Capital Social effects

Policies

Individual effects

HR Practices
Ecological effects
 Sustainable HRM Model (Ehnert, 2009, in Kramar, 2014)
 Source of HR (‘origin’ of HR):
 Human Capital:
 HRM Strategy
 Policies

 Practices

Which influence and are influenced by:

 The organizational, social, individual and ecological effects of
 Normative, Efficiency and Substance interpretations of
sustainability
 Overall strategy of a company

Within an organizational context

Within the overall socioeconomic, ecological, institutional
and technological context of the environment.
Which in turn feeds into the source of human resources
 Sustainable HRM Model (Contd.)
(Ehnert, 2009, in Kramar, 2014)

 Normative interpretations of sustainability:

 Organizational effects: Responsibility, ethics, care,
good employment relationship, workplace quality
 Social effects: Social legitimacy, accountability, trust
(/worthiness), quality of life, good relations, etc.
 Individual effects: Well being, quality of life, sense
of identity
 Ecological effects: Energy use, paper, location of
work
 Sustainable HRM Model (Contd.)
(Ehnert, 2009, in Kramar, 2014)

 Efficiency interpretations of sustainability:

 Organizational effects: Sustained competitive
advantage, innovativeness, productivity
 Social effects: Human capital
 Individual effects: Performance, satisfaction,
motivation
 Ecological effects: Reduce costs, travel for work
 Sustainable HRM Model (Contd.)
(Ehnert, 2009, in Kramar, 2014)

 Substance interpretations of sustainability:

 Organizational effects: Durable supply with HR,
long-term viability, problem solving ability, healthy
workforce
 Social effects: Viability of sources of HR (families,
schools, universities, etc.), employee of choice
recognition
 Individual effects: Employability, lifelong learning,
work-life balance, regeneration, health
 Ecological effects: Green products & services,
volunteer programs
Factors influencing the formulation &
implementation of HR policies (Kramar, 2014)
 Appropriateness in the context of economic, social and
ecological outcomes
 Relevance to current needs and future needs
 Support from the management
 Resources
 Perception regarding fairness
 Visibility and ease of understanding
 Perception of consistency among decision makers
 Employee support
 Clear and action oriented communication (including
Thank You
Human Resource Management
HR Measurement & Accountability
Aradhna Malik (PhD)
Assistant Professor
VGSoM, IIT Kharagpur
 Sources
 Hall, D. (2009). Managing performance. In S.
Gilmore & S. Williams (Eds.). Human Resource
Management. (Indian Edition). New Delhi:
Oxford, 139-167.
 Phillips, J. J. (2005). CHAPTER 10: Creating and
Using the Human Capital Scorecard.
In, Investing in Your Company's Human
Capital (pp. 211-233). American Management
Association International.
 Srimannarayana, M. (2010). Status of HR
measurement in India. Vision – The Journal of
 Results-based approach to HRM
(Phillip, 1999, in Srimannarayana, 2010)
 “Performance measurements should be developed for all HR functions.
When that is not feasible, at least a few key measures should be in place
in each function.
 Major organizational decisions should always involve input from the HR
function.
 Return on investment in HR should be measured by improvements in
productivity, cost savings, & quality.
 The concern for the method of evaluation should occur before the
program is developed.
 HR programmes should never be implemented without a provision for at
least some type of formal method of measurement & evaluation.
 The costs of all individual HR programmes should be continuously
monitored
 The cost of absenteeism, turnover, & leave should be routinely
calculated & monitored.
 Cost benefit comparisons of HR programs should be conducted
frequently
 In an economic downturn, the HR function should go untouched in staff
reductions or possibly beefed up.
 The cost of employee benefits should be routinely monitored &
compared to national data, industry norms & localized data.”
 Results-based approach to HRM (Contd.)

 (Phillip,
“The CEO 1999, in Srimannarayana,
should 2010) with the executive responsible for
frequently interface
human resources
 The top HR executive should report directly to the CEO
 Line management involvement in the implementation of HR programs
should be significant
 The entire HR staff should have some responsibility for measurement &
evaluation
 HRD efforts should consist of a variety of education & training programs
implemented to increase the effectiveness of the organization
 When an employee completes an HR program, his or her supervisor
should require the use of the program material & reward the employee
for meeting or exceeding program objectives
 Pay for performance programs should be considered for most
employees, both line & staff
 Productivity improvement, cost reduction, or quality work life programs
should be implemented in many locations & should achieve positive
results
 The results of HR programs should be routinely communicated to a
variety of selected target audiences
 The impact of the HR function on the bottom-line contribution can be
estimated with little additional cost.”
 Scorecard
 A formal method of quantifying the construct
that is being assessed on a pre-determined set
of parameters.
 “A printed program or card enabling a spectator
to identify players & record the progress of a
game or competition” (American Heritage Dictionary, in Phillips, 2005)
 A small card used to record one’s own
performance in sports such as golf” (American Heritage
Dictionary, in Phillips, 2005)
Why use human capital scorecards
(Walsh, 2002, in Phillips, 2005)

 “Measure human capital in a recognized way

 Track changes in the value of human capital
 Specify how to increase human capital
 Form the basis of performance management/
reward systems
 Justify investment in human capital”
 Criteria for developing effective measures of human
output (Kerr, 1995 & Mayo, 2003, in Phillips, 2005)
Criterion Definition: The extent to which a measure…
Important Connects to strategically important business objectives rather than to what is
easy to measure
Complete Adequately tracks the entire phenomenon rather than only a part of the
phenomenon
Timely Tracks at the right time rather than being held to an arbitrary date
Visible Is visible, public, openly known, & tracked by those affected by it rather than
collected privately for management’s eyes only
Controllable Tracks outcomes created by those affected by it, who have a clear line of sight
from the measure to the results
Cost-effective Is efficient to track by using existing data or data easy to monitor rather than
requiring a new layer of procedures
Interpretable Creates data that re easy to make sense of & translate to employee actions
Simplicity Simple to understand from each stakeholder’s perspective
Specific Is clearly defined so people quickly understand & relate to the measure
Collectable Can be collected in a way where the effort required is proportionate to the
resulting usefulness of the measure
Team-based Will have value with a team of individuals & not just an individual judgment
Credible Provides information that is valid & credible in the eyes of the management
 Workforce measures scorecard
(Corporate Leadership Council, 2004, in Phillips, 2005)
Category Description
Demographic Describes & compares organizational segments on a range of
profile demographic & personal attributes, e.g. age, employment status,
occupational group, tenure, gender & ethnic diversity
Productivity Combines a range of ‘input’ & ‘output/ outcome’ measures that can be
examined together to gauge organizational effectiveness
Availability Measures & compares availability & absence patterns of employee
segments
Mobility Monitors & compares flow of the workforce into, within & out of the
organization
Performance & Quantifies current & emerging skills profile of the organization & the
development resources devoted to organizational development
Compensation Monitors & compares the compensation & benefits made available to
& benefits reward & retain employees
Workforce Measures labor relations effectiveness & costs
relations
Basic Input Process Output (IPO)
Scorecard (Phillips, 2005)
Input Process Outcome
Measures Measures Measures

• Programs • Time to recruit • Retention

• Participants • Participation rates • Productivity
• Volume • Promotion rates • Job satisfaction
• Costs • •
• Employees • •
•
 Causal Chain Scorecard (Phillips, 2005)
Input Measures:
Cost Measures: Cost Reaction Measures:
People, programs,
of all inputs Reaction & satisfaction
projects, times, etc.
data from stakeholders

Learning Measures:
Changes in knowledge
skills & perceptions

Return on Investment Impact Measures:

Measures: Studies Application/ Impact
Intangible & tangible
comparing monetary Measures: Activity,
data linked to human
benefits with costs of behavior, & use data
capital programs
human capital programs
The HR Process Scorecard(Phillips, 2005)
Acquisition/ Profile: Maintenance/
Preparation/ Readiness:
Job growth, Compensation: Pay,
Experience, Learning,
Recruitments, Benefits, Variable pay,
Knowledge, Education
Recruiting efficiency, Employee ownership
Demographics

Motivation/ High
Performance:
Engagement, Productivity,
Leadership

Removal/ Departure: Retention/ Loyalty:

Exit interviews, Turnover, Tenure,
Complaints, Charges, Satisfaction
Litigation
Kaplan & Norton Balanced Scorecard
(Phillips, 2005)

Employee Internal
Learning & Processes Customer Financial
Growth
• No. of programs • Participation rates • Stakeholder • Costs of
• Hours of training • Completion rate satisfaction human capital
• Process times • Reaction • Costs of
• Perceived program
value • Costs of
processes
• ROI
 Best Practice Scorecard: Common Human
Capital Measures (Phillips, 2005)
1. Innovation & creativity 7. Productivity:
2. Employee attitudes: a. Unit productivity
a. Employee satisfaction b. Gross productivity
b. Organizational commitment 8. Workforce profile: Profile
c. Employee engagement
3. Workforce stability: 9. Job creation & acquisition:
a. Turnover & termination a. Job growth
b. Tenure & longevity b. Recruitment sourcing & effectiveness
4. Employee capability: c. Recruiting efficiency
a. Experience 10. Compensation & benefits:
b. Learning a. Compensation
c. Knowledge b. Employee benefits
d. Competencies c. Variable compensation
e. Educational level d. Employee ownership
5. Human capital investment:
a. HR department 11. Compliance & safety:
b. Total HC investment a. Complaints & grievances
c. Investment by category b. Charges & litigation
6. Leadership: c. Health & safety
a. 360 deg feedback 12. Employee relations:
b. Leadership inventories a. Absenteeism & tardiness
c. Leadership perception b. Work/ life balance
Balanced Scorecard (Hall, in Gilmore & Williams, 2009)
 Kaplan and Norton (1996): Performance measurement system to
Performance management system
 Perspectives to managing performance:
 Customer: Customer value proposition
 Business processes (operational): The internal processes & systems
 Innovation & learning (people): The human contribution through
knowledge & skills
 Goals: Strategic goals at the top level of an organization and then
‘translated’ into appropriate goals at lower levels such as business units,
teams, & individuals
 Process of translating and ‘cascading’ strategic aims into goals at every
level throughout an organization guides and encourages people to
contribute towards the overall performance of the organization
 Strategic mapping: Definition of strategic aims and relation of these aims to
organizational activities to serve as a basis for specifying goals within the
different performance perspectives
Balanced Scorecard (Hall, in Gilmore & Williams, 2009)
Financial
perspective
How we
satisfy our
shareholders

Customer
Operational perspective
perspective
How our
Vision and customers
How we excel strategy
at what we do view us

People
perspective
How our
employees
contribute
Example of a Balanced Scorecard
(Hall, in Gilmore & Williams, 2009)

Goal Measure or Objective/ target Development

(Broad objective) ‘metric’ actions
Achieve ‘excellent’ % of customers Less than 10% loss Develop ‘lost
customer lost over 12 of customers in 6 customers’ report
satisfaction months months time

% of customers More than 80% of Use customer

completed a CS customers feedback to
survey in past 6 complete a CS improve CS survey
months survey this year
Level of CS More than 75% of Develop employee
customers to rate competencies in
our service as CS
‘excellent’
Quartile for CS Upper quartile in Develop
compared to sector industry sector by benchmarking
end of financial within sector
year
Criticisms of Balanced Scorecard
(Hall, in Gilmore & Williams, 2009)

 Issues related to its interpretation and

implementation
 Issues related to time/ level of implementation
 Individual
 Reporting tool
 Distraction from business activities
 Lack of ownership and accountability
 Difficult to establish ‘cause & effect’
 Using the scorecard (Phillips, 2005)
 Select the measures & ensure that all stakeholders agree
 Set the target from minimum acceptable levels to ideal
levels of performance
 Monitor the data
 Conduct a gap analysis regarding the gap in a specific
measure
 Identify/ select action/ solution
 Implement action/ solution
 Forecast the value
 Monitor the progress
 Show the value by calculating the impact of the solution to
close the gap.
 Repeat the process
 Useful Links
 Balanced Scorecard Institute:
balancedscorecard.org
 Kaplan & Norton 2007: Using the balanced scor
ecard as a strategic management system
Thank You
 Principles of HRM

Discipline in organizations
Aradhna Malik (PhD)
Assistant Professor
VGSoM, IIT Kharagpur
 Sources

Gomez-Mejia, L. R., Balkin, D. B. & Cardy, R. L.

(2012). Managing human resources (7th Ed.).
New Delhi: PHI Ltd.
Williams, S. & Rumbles, S. (2009). Grievance,
discipline & absence in organizations. In S.
Gilmore & S. Williams (Eds.). Human Resource
Management (Indian Edition). New Delhi:
Oxford. 259-281.
 Discipline (Gomez-Mejia, Balkin & Cardy, 2012)
 “Tool that managers rely on to communicate to
employees that they need to change a behavior”
 Forms:
 Progressive discipline: “Series of management
interventions that gives employees opportunities to
correct their behavior before being discharged.” –
primarily warning steps, e.g. Verbal warning – written
warning – suspension – discharge
 Positive discipline: “…encourages employees to monitor
their own behaviors and assume responsibility for their
actions.”. Four step process – Counselling session
between employees and supervisors – follow up and
formation of a new timetable & plan – final warning -
Why are disciplinary procedures
necessary? (Williams & Rumbles, 2009)
 “…so employees know what is expected of them in terms
of performance or conduct (and the likely consequences
of continued failure to meet these standards)
 To identify obstacles to individuals achieving the required
standards (e.g. training needs, lack of clarity of job
requirements, additional support needed, etc.)
 As an opportunity to agree to suitable goals and
timescales for improvement in an individual’s
performance or conduct
 As a point of reference for an employment tribunal should
someone make a complaint about the way they have
Basic standards of discipline
(Gomez-Mejia, Balkin & Cardy, 2012)

 Communication of rules & performance criteria

 Documentation of the facts
 Consistent response to rule violations
 The just cause standard of discipline
(Gomez-Mejia, Balkin & Cardy, 2012)
 “Notification: Was the employee forewarned of the
disciplinary consequences of his or her conduct?”
 “Reasonable rule: Was the rule the employee violated
reasonably related to safe & efficient operations?”
 Investigation before the discipline
 “Fair investigation: Was the investigation fair & impartial?”
 “Proof of guilt: Did the investigation provide substantial
evidence or proof of guilt?”
 “Absence of discrimination: Were the rules, orders &
penalties of the disciplinary action applied evenhandedly &
without discrimination?”
 “Reasonable penalty: Was the disciplinary penalty
reasonably related to the seriousness of the rule
violation?”
Administration of discipline (Gomez-Mejia, Balkin & Cardy, 2012)

 Hot stove rule: “Model of disciplinary action:

Discipline should be immediate, provide ample
warning, & be consistently applied to all.
 Mistakes to avoid when administering
discipline (Gomez-Mejia, Balkin & Cardy, 2012)
 Losing your temper
 Avoiding disciplinary action entirely
 Playing therapist
 Making excuses for an employee
 Using a nonprogressive approach to discipline
– avoid immediate punishment
Steps for effective disciplinary sessions
(Cottringer, 2003 & Day, 1993, in Gomez-Mejia, Balkin & Cardy, 2012)
 “Determine whether discipline is called for. Is the problem an isolated
infraction or part of a pattern? Consult with HR experts & get some
feedback before making a disciplinary decision.
 Outline clear goals for the discussion in your opening remarks. Do not rely
on indirect communication or beat around the bush. The employee should
gain a clear idea of your expectations for improvement.
 Ensure two-way communication. The most helpful disciplinary meeting is
a discussion, not a lecture. The objective of the meeting, after all, is to
devise a workable solution, not to berate the employee.
 Establish a follow-up plan. The agreement to a follow-up plan is crucial in
both the progressive & positive disciplinary procedures. It is particularly
important to establish the time frame in which the employee’s behavior is
to improve.
 End on a positive note. You may want to emphasize the employee’s
strengths so that he or she can leave the meeting believing that you – and
the company – want the employee to succeed.”
The content of disciplinary & grievance
procedures (Williams & Rumbles, 2009)
 “A statement of principles – something that among other things
sets out the purposes for which it will be used & the nature of the
approach to be taken”
 “Provisions for dealing with instances of minor misconduct
informally”
 “A list of behaviors classified as misconduct that would lead to
disciplinary procedure being invoked”
 “Provisions for how the alleged misconduct should be
investigated, & also for a meeting at which the employee is
presented with the case against her/ him & given a chance to
present her/ his side of the story”
 “Disciplinary procedures provide for the appropriate sanctions to
be applied should the case against the employee be upheld
following the disciplinary meeting”
 “Provision for the right of an employee to appeal against the
outcome of a disciplinary meeting, commonly to a senior manager
who has had no previous involvement in the case”
Thank You
 Principles of HRM

Handling Difficult Employees

Aradhna Malik (PhD)
Assistant Professor
VGSoM, IIT Kharagpur
 Sources
Cook, N. (2014, June). Bullying in the workplace.
ROSPA Occupational Safety & Health Journal, 17-
19.
Gomez-Mejia, L. R., Balkin, D. B. & Cardy, R. L.
(2012). Managing human resources (7th Ed.). New
Delhi: PHI Ltd.
HR Specialist (2012, September). Avoid the
perception of bullying, 6.
Security Director’s Report (2010, October). The next
step in curbing workplace bullying. 2-4.
Teller vision (2015, May). Dealing with workplace
bullying. 4-5.
Handling difficult employees
(Gomez-Mejia, Balkin & Cardy, 2012)

 Issues:
 Positive drug use tests
 Indiscipline detected during electronic monitoring
 Office romance
 Absence/ poor attendance
 Poor performance
 Insubordination
 Workplace bullying
 Alcohol related misconduct
Positive drug use tests (Gomez-Mejia, Balkin & Cardy, 2012)
 Find out if the employee’s behavior has been
disruptive to her/ his own work or anyone else’s
work in the workplace
 Legitimacy of drug use, and false positives, e.g.
pain medication or poppy seeds (khus khus)
 Treatment of positive drug use test –
rehabilitation & counselling vs. discharge
 Security and confidentiality of test results
Indiscipline detected during electronic
monitoring (Gomez-Mejia, Balkin & Cardy, 2012)
 Necessity of electronic monitoring
 Communication of electronic monitoring to
employees
 Casual browsing of harmless websites and
occasional personal emails vs. disruption of
work due to habitual electronic loafing
 Confidentiality of information regarding
detection of indiscipline
Handling office romance
(Gomez-Mejia, Balkin & Cardy, 2012)

 Clarity of policies regarding office romance –

allowed or not allowed, and allowed under
which conditions (among peers, supervisor-
subordinate, etc.)
 Impact of office romance on official work and
output of employees involved
 Confidentiality regarding discovery of office
romance
Absence/ poor attendance
(Gomez-Mejia, Balkin & Cardy, 2012)

 Reasonability of the attendance rule: Allowance

for emergencies and flexibility regarding diverse
needs of a diverse workforce
 Warning regarding the consequences of poor
attendance
 Giving the employee a chance to defend
her/himself - Reasonable assessment of
situation
 Confidentiality of meeting details
Poor performance (Gomez-Mejia, Balkin & Cardy, 2012)
 Reasonability of performance standards
 Provision of reasonable accommodation for
exigencies
 Communication of the organization’s
performance standards to all employees
 Documentation of poor performance followed
by counselling and remedial measures before
punishment
 Confidentiality regarding need for corrective
action and punishment
 Managing issues with telecommuting
(Gomez-Mejia, Balkin & Cardy, 2012)

 “Select telecommuters with care, considering the work

habits of the employee& the type of work involved.
 Maintain schedules & make sure telecommuters stick
to deadlines.
 Make sure that the technology works.
 Have phone based workers come in to the office on a
regular basis so they can attend meetings & interact
with managers.
 Develop a well-planned telecommuters plan that
includes performance expectations with measurable
results.
 Don’t make telecommuting a term of employment.”
 Insubordination (Gomez-Mejia, Balkin & Cardy, 2012)
 “Insubordination [is] an employee’s refusal to
obey a direct order from a supervisor, [and] is a
direct challenge [to] the management’s right to
run the company”
 “… also occurs when an employee is verbally
abusive to a supervisor”
 Permissible only when:
 Orders relate to an illegal activity
 Orders put the employee in some kind of danger
Onus lies on the employee to prove the reason for
insubordination
 Managing insubordination
(Gomez-Mejia, Balkin & Cardy, 2012)

 Written vs. oral orders

 Proof of insubordination
 Seriousness of issue
 Reason for insubordination
 Confidentiality
Workplace bullying (Gomez-Mejia, Balkin & Cardy, 2012)
 “Workplace bullying [is] a form of harassment that
results in employees experiencing mental distress,
physical illness, loss of productivity, & a higher
propensity to quit to avoid being in a toxic workplace.”
 “… consists of persistent, offensive, abusive,
intimidating, malicious or insulting behavior, abuses
of power or unfair penal sanctions, which makes the
recipient feel upset, threatened, humiliated, or
vulnerable, which makes the recipient feel upset,
threatened, humiliated, or vulnerable, which
undermines their self-confidence & which may cause
them to suffer stress.”
Types of workplace bullying (Teller vision, 2015)
 False accusations
 Ignoring/ dismissing comments/ inputs
 “A different set of standards or policies […] used for the
worker”
 “Gossip spread about the worker”
 Constant criticism by the boss or coworkers
 Belittling comments made about the worker in public or in
private
 Yelling at the subordinate
 Purposeful exclusion from projects or meetings
 Giving credit of targetted employee’s work to other workers
or denying credit to targetted employee

 Managing workplace bullying
(Teller Vision, 2015, Cook, 2014, HR Specialist, 2012)
 As detailed documentation as possible
 “Consider talking to the bully”
 “Always focus on the resolution” or a way forward
 “Devise & implement a workplace bullying & harassment policy”
 “Promote a culture where bullying & harassment are not tolerated”
 Be aware of the organizational factors that are associated with bullying
& take steps to address them”
 “Follow procedures laid down in their organization’s bullying &
harassment policy”
 “Be sensitive, objective & seek information”
 Know what is bullying and what is not
 Focus on the issue and not on the persons involved
 “Don’t single out an employee for discipline”
 “Don’t respond to employee mistakes with an accusing tone & loud
voice”
 “Be cautious of jokes”
 “Keep reprimands private”
 Specific strategies to manage workplace
bullying (Security Director’s Report, 2010)
 In response to the relational aggressor (bully):
 “Act quickly”
 “Notifications & sanctions: Inform the relational aggressor
that the behavior is not acceptable, first verbally, then in
writing”
 Change job responsibilities primarily to avoid contact
between aggressor & victim
 Supervision: Monitor closely after informing employees
about monitoring
 “Training: Include relational aggression as part of awareness
education of bullying behavior, including the consequence of
these behaviors upon victims & their colleagues”

 Specific strategies to manage workplace
bullying (Contd.) (Security Director’s Report, 2010)
 For the victim:
 “Relocation or reassignment” primarily to avoid
contact with aggressor
 Mentoring
 Individual treatment and support
 Group treatment and support
 Specific strategies to manage workplace
bullying (Contd.) (Security Director’s Report, 2010)
 For the organization:
 Hiring practices: Review job candidates’ applications carefully, including
directly questioning potential applicants’ references regarding any history
of bullying & relationally aggressive behavior
 Firing practices: Willingness and ability to fire aggressive employees
 Policies and procedures: Development and implementation of anti-
bullying policy that addresses identification of bullies and lays down
procedures for dealing with them
 “Reporting: Create a formal, nonjudgmental reporting procedure for
victims to identify relational aggressors without fear or retaliation”
 “Naming the problem: Employees should be given an opportunity to
discuss workplace bullying in all forms & to identify the mechanisms that
perpetuate the behavior”
 “Education: Provide employees information to illuminate bullying and
relational aggression within the workplace, including definitions &
examples of bullying, its effects on bullies, victims & organizational
culture, & strategies for addressing the problem”
Alcohol related misconduct
(Gomez-Mejia, Balkin & Cardy, 2012)

 Chronic alcoholism vs. inebriated employees in

the workplace vs. use of alcohol at work
 Severity of misconduct – disruption of work –
self & others
 Public nuisance issues
 Counselling and remedial action leading to
discharge
 Confidentiality
Thank You
 Principles of HRM

Using HRM to Prevent the Need for Discipline

Aradhna Malik (PhD)
Assistant Professor
VGSoM, IIT Kharagpur
 Source
Gomez-Mejia, L. R., Balkin, D. B. & Cardy, R. L.
(2012). Managing human resources (7th Ed.).
New Delhi: PHI Ltd.
Calming angry workers when you are the
target (HR Specialist, 2012)
 “Abstain from interrupting
 Agree to the extent you can
 Acknowledge the problem
 Apologize to the extent that you can
 Act within your authority
 Assess the outcome”
Preventing the need for discipline
with HRM (Gomez-Mejia, Balkin & Cardy, 2012)
 Recruitment & selection:
 Person-job fit
 “Checking references & gathering background
information on applicants’ work habits & character”
 “Multiple interviews that involve diverse groups in
the company can reduce biases that lead to poor
hiring decisions.”
 Personality tests administered over a period of a
few days to assess their disposition and ability to
work as expected
Preventing the need for discipline
with HRM (Gomez-Mejia, Balkin & Cardy, 2012)
 Training & Development:
 Effective orientation program – “…communicates to new
employees the values important to the organization”; orients
them towards the expectations of the organization; and helps
them “… manage their own behavior better”
 Reduction of skill gaps & improvement of competencies
through initial training & periodic re-training programs
 “Training supervisors to coach & provide feedback to their
subordinates encourages supervisors to intervene early in
problem situations with counselling rather than discipline”
 Development of career ladders or clear and achievable career
progression programs and provision of support for career
progression
Preventing the need for discipline
with HRM (Contd.) (Gomez-Mejia, Balkin & Cardy, 2012)
 HR planning:
 “Jobs should be designed to use the best talents of
each employee”
 Job banding: “…[replacement of] traditional
narrowly defined job descriptions with broader
categories, or bands, of related jobs.”
 “Job descriptions & work plans should be
developed to communicate effectively to employees
the performance standards to which they will be
held accountable”
Preventing the need for discipline
with HRM (Contd.) (Gomez-Mejia, Balkin & Cardy, 2012)
 Performance appraisal:
 Reasonable standards of performance appraisal criteria
 Provision of continuous feedback to subordinates with
interventions as often and as promptly as required
 Proper documentation of employee appraisals to “…
protect employees against wrongful discharge or
discrimination suits”
 Ability of performance appraisals to “…measure
employee behaviors in addition to performance
outcomes so that employees receive feedback on the
methods they use to achieve their expected
Preventing the need for discipline
with HRM (Contd.) (Gomez-Mejia, Balkin & Cardy, 2012)
 Compensation:
 Perception of pay policies as fair by all employees
 “An appeal mechanism that gives employees the
right to challenge a pay decision”
Thank You