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Copyright

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Learning Outcomes
 Explain how human resources managers and other
managers can have rewarding careers by helping their
firms gain a sustainable competitive advantage
through the strategic utilization of people
 Explain how good human resources practices can help
a firm’s globalization, corporate-social responsibility,
and sustainability efforts
 Describe how technology can improve how people
perform and are managed

Copyright ©2016 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly acce ssible website, in whole or in part. 2
Learning Outcomes
• Explain the dual goals HR managers have in terms
increasing productivity and controlling costs
• Discuss how firms can leverage employee differences
to their strategic advantage and how educational and
cultural changes in the workforce are affecting how
human resources manager engage employees
• Provide examples of the roles and competencies of
today’s HR managers and their relationship with
other managers

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Human Resources Management
 Process of managing human talent to achieve an
organization’s objectives
 Importance
 Managers play a key role in selecting, training,
motivating, appraising and promoting employees
 Good personnel help build business
 Helps understand one’s rights and responsibilities as an
employee

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Human Capital and HRM
 Human capital: Knowledge, skills, and capabilities of
individuals that have economic value to an
organization
 Intangible and cannot be managed the way
organizations manage jobs, products, and technologies
 Organizations should utilize employee knowledge and
invest in their development

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Figure 1.1 - Overall Framework of
Human Resource Management

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Responding Strategically to Changes in
the Marketplace
 Making adjustments in labor force
 Downsizing: Planned elimination of jobs
 Outsourcing: Hiring outside the company to perform
processes previously done within the firm
 Offshoring: Sending jobs to other countries
 Implementing cost-cutting strategies
 Enhancing benefit programs
 Improving quality
 Expanding market shares and product lines

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Responding Strategically to Changes in
the Marketplace
 People resist change as it involves modifying or
abandoning familiar ways of working
 To manage change, executives and managers have to:
 Envision the future
 Communicate vision to the employees
 Set clear expectations for performance
 Develop capabilities to execute by reorganizing people
and reallocating assets
 Make an investment in implementing and sustaining
the change

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Responding Strategically to Changes in
the Marketplace
 Organization that successfully engineers change:
 Links it to the business strategy
 Shows how it creates quantifiable benefits
 Engages key employees, customers, and suppliers early
 Makes an investment to implement and sustain it
 Strategic changes could be proactive or reactive
 To provide knowledge on core business issues,
companies:
 Assign HR representatives to core business teams
 Rotate non-HR managers into HR positions and vice
versa
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Competing, Recruiting, and Staffing
Globally
 Integration of world economies and markets have led
companies to:
 Look for opportunities abroad
 Fend off foreign competitiors domestically
 Search for the right employees
 Companies are making it possible for people to buy
anything, anytime, anywhere
 Companies of all sizes are engaging in partnerships,
mergers, and acquisitions

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Competing, Recruiting, and Staffing
Globally
 National identities of products are blurring
 Lower trade barriers with free-trade agreements
 General Agreements on Tariffs and Trade (GATT) paved
the way for North American Free Trade Agreement
(NAFTA) and European Union
 GATT was replaced by the World Trade Organization
(WTO)

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Competing, Recruiting, and Staffing
Globally
 Issues in HRM due to globalization
 Dealing with better informed employees who are willing
to pursue global job opportunities
 Gauging the knowledge and skill base of workers
worldwide
 Understanding how to hire and train them
 Relocating and training foreign managers abroad to
direct the efforts of an international workforce

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Setting and Achieving Corporate Social
Responsibility and Sustainability Goals
 Corporate social responsibility: Responsibility of
the firm to act in the best interests of the people and
communities affected by its activities
 Improves company’s earnings and helps avoid lawsuits

 Sustainability: Ability to produce a good or service


without damaging the environment or depleting a
resource
 Companies are making strides to reduce their carbon
footprints
 HR should spearhead the development and
implementation of corporate citizenship
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Technology Challenges
 Organizations are taking advantage of information
technology advancements
 Collaborative software: Allows workers to interface
and share information with one another electronically
 Shift from touch labor to knowledge workers
 Knowledge workers: Workers whose responsibilities
extend beyond the physical execution of work to include
planning, decision-making, and problem-solving
 Companies spend on training and virtual learning

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Technology Challenges
 Human resources information system (HRIS)
 Provides current and accurate data for purposes of
control and decision-making
 Used to:
 Automate payroll processing and administer benefits program
 Access employee records
 Recruit, screen, and pretest applicants online
 Train, track, and select employees
 Open source HRIS software can be good low cost
solution for startups and small businesses

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Productivity and Cost Challenges -
Maximizing Productivity
 Productivity - Output gained from a fixed amount of
inputs
 Can be increased by:
 Reducing inputs
 Adding more human and physical capital to the process
 Additional productivity will have to come from:
 Enhanced ability of employees
 Motivation
 Work environment

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Productivity and Cost Challenges -
Managing the Size of the Workforce
 Should match the firm’s demand requirements,
strategic decision, and competition
 Offshoring - Aids quicker delivery of products
 Outsourcing - Helps reduce costs and focus on
important activities
 Nearshoring: Bringing jobs closer to domestic
countries

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Productivity and Cost Challenges -
Managing the Size of the Workforce
 Homeshoring: Outsourcing work to domestic workers
who work out of their homes
 Furloughing: Practice of requiring employees to take
time off for either no pay or reduced pay
 Hiring part-time employees

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Productivity and Cost Challenges -
Managing Pay and Benefits
 Concerns - High health care costs and compliance with
new health reforms
 Companies are charging higher premiums to cover
spouses
 Provide employees a set amount to purchase health
insurance on their own
 Employee leasing: Dismissing employees who are then
hired by a leasing company and contracting with that
company to lease back the employees
 Provides benefits that small companies cannot afford

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Responding to the Demographic and
Diversity Challenges of the Workforce
 HR managers analyze the capabilities of demographic
groups and how well each is represented in fast-
growing and slow-growing occupations
 Forecast trends to support organizational strategies
 Labor force participation rate - Number people
employed or actively looking for work
 Ethnic and racial differences
 Age and gender distribution

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Figure 1.2 - Labor Force Participation Rates of Workers of
Hispanic origin versus Non-Hispanic Origin

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Figure 1.3 - Labor Force Participation Rates
of Workers in the Labor Force by Their Ages

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Figure 1.4 - Labor Force Participation
Rates by Gender

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Adapting to Educational Shifts Affecting
the Workforce
 Education attainment of the labor force has risen
dramatically
 Helps a person stay out of the ranks of the unemployed
 American students are said to lag behind in math and
science test scores
 HR managers have to find strategies to help their firms
compete, despite challenges

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Adapting to Cultural and Societal
Changes Affecting the Workforce
 Culture and society affect one’s behavior on the job
and the environment within the organization
 Influences reactions to:
 Work assignments
 Leadership styles
 Reward systems
 HR policies should be adjusted to cope with ongoing
changes
 Changing employee rights
 Heightened privacy concerns of employees

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Adapting to Cultural and Societal
Changes Affecting the Workforce
 Employers are implementing privacy policies, limit the
use of social security numbers and conduct
background checks
 Excessive monitoring could lead to ligation
 Changing attitudes toward work and how they relate
to employee engagement
 Employees are focused on finding interesting work
and pursuing multiple careers
 Employee engagement: Extent to which employees are
enthused about their work and committed to it
 Balancing work and family
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Role of HR Managers and T heir
Partnership with Other Managers
 HR managers help firms choose the best strategies to
compete globally
 Select ideal HR systems, maximize productivity and
manage benefits
 Successful organizations combine the experience of
line managers with the expertise of HR managers
 To develop and utilize the talents of employees to their
greatest potential
 Line managers: Non-HR managers who are responsible
for overseeing the work of other employees
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Role of HR Managers and Their
Partnership with Other Managers
 Responsibilities of human resources managers
 Strategic advice and counsel
 Service
 Policy formulation and implementation
 Employee advocacy

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Figure 1.7 - Human Resource Competency
Model

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