HRM1501_70510512_interactive _002_.pdf - Department of Human Resource Management Introduction to Human Resource Management Only Study guide for HRM 1501

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Unformatted text preview: Department of Human Resource Management Introduction to Human Resource Management Only Study guide for HRM 1501 Open Rubric © 2017 University of South Africa All rights reserved Printed and published by the University of South Africa Muckleneuk, Pretoria HRM1501/1/2018–2020 70510512 MNB_style InDesign HRM1501/1/2018 CONTENTS Page TOPIC 1: Introduction to human resource management (HRM) Workbook 01, 02 and 03: Defining HRM, integration of HRM with the rest of the organisation and the role and importance of HRM Workbook 04: Ethics and the professionalism in HRM TOPIC 2: HRM functions 1 3 13 19 Workbook 05: Human resource (HR) planning 20 Workbook 06: Recruitment 31 Workbook 07: Selection 44 Workbook 08: Orientation, training and development 52 Workbook 09: Performance management 63 Workbook 10: Compensation 74 Workbook 11: Employee health and safety 85 Workbook 12: Labour relations 97 TOPIC 3: People dynamics 115 Workbook 13: Organisational behaviour (OB) 116 Workbook 14: The individual in the organisation 129 Workbook 15: Groups in organisations 141 TOPIC 4: The new world of HRM 151 Workbook 16: Technology in the world of HR 152 Workbook 17: Outsourcing the HRM function 158 Workbook 18: HRM’s contribution to organisational success 165 BIBLIOGRAPHY 172 (iii) (iv) HRM1501/1 TOPIC 1 Introduction to human resource management (HRM) GENERAL ORIENTATION We hope that by now, you are familiar with the module HRM1501 and the general myUnisa environment. At this stage, you should have read the introduction and orientation to the module. Tutorial Letter HRM1501/101/3/2018 as well as the module study plan. Keep in mind that the study plan merely serves as a guideline. You are free to adjust it according to your own study needs taking into consideration your work-life balance. Here is an outline of the four topics to be addressed in this module: Each topic is divided into several workbooks as shown in the mind map below. The purpose of this mind map is to see where you are with your study material. 1 Workbook 01,02 and 03: Defining HRM, integration Topic 1 of HRM with the rest of the organisation and the role and importance of HRM Introduction to human resource management {HRM) Workbook 04: Ethics and the professionalism in HRM Workbook OS: Human resource (HR) planning Workbook 06: Recruitment Topic 2 Workbook 07: Selection HRM functions ... Workbook 08: Orientation, training and development Workbook 09: Performance management Workbook 10: Compensation Workbook 11: Health and safety Workbook 12: Labour relations Topic 3 People dynamics .,.... Workbook 13: Organisational behaviour (OB) Workbook 14: The individual in the organisation Workbook 15: Groups in organisations Workbook 16: Technology Topic 4 The new world of HRM .... ,. Workbook 17: Outsourcing the HRM function Workbook 18: HRM's contribution to organisational success 2 HRM1501/1 Workbook 01 to 03 Defining human resource management (HRM) Contents 1.1 1.2 1.3 1.4 1.5 1.6 1.7 INTRODUCTION, OUTCOMES AND KEY CONCEPTS DEFINING HUMAN RESOURCE MANAGEMENT (HRM) THE ROLE AND PLACE OF HRM IN ORGANISATIONS THE HRM MODEL FUNCTIONS AND ACTIVITIES OF HRM STAKEHOLDERS AND THEIR INFLUENCE ON HRM SUMMARY 1.1 INTRODUCTION, LEARNING OUTCOMES AND KEY CONCEPTS People meet on daily basis in organisations to perform certain tasks and activities. For these people to perform the tasks and activities, they need to have the skills and abilities, inborn talents, past work experience, educational qualifications and many more capabilities. The afore-mentioned job requirements are often referred to as human resources. The driving force behind the performance of tasks and activities is to earn a living and at the same time to assist the organisation in producing products and services for the survival of human beings as employees and as members of the society. Learning outcomes After completing this workbook, you should be able to y y y y y define the concept “human resource management (HRM)” discuss the role of HRM in organisations illustrate the HRM model identify the HR function and its various activities distinguish between the various stakeholders likely to influence HRM in organisations 3 Key concepts y y y Human resource management (HRM) HRM policy, practices and programmes Stakeholders 1.2 DEFINING HUMAN RESOURCE MANAGEMENT (HRM) The majority of researchers, authors and theorists all have different definitions of HRM. The bottom line is that HRM refers to the effort invested by human resource (HR) practitioners in ensuring that the skills and abilities, inborn talents, past experience and educational qualifications inherent in employees are used to benefit both the employees and the organisation. Employees benefit from utilising their human resources through compensation while the organisation benefits by realising a return on investment, that is, by maximising profitability, sustainability, competitiveness and through growth and development. Bratton and Gold (2007) define HRM as a strategic approach to managing employment relations. This means that being able to leverage employee capabilities is critical for a competitive advantage. This may be achieved through an integration of employment policies, programmes and practices. Story (2007) is in support of Bratton and Gold’s definition of HRM by stating that HRM is a distinctive approach to employment management which seeks to achieve competitive advantage through strategic development of a highly committed and capable workforce, using an integrated array of cultural, structural and HR techniques. Erasmus, Schenk and Tshilongamulenzhe (2014:6) define HRM as the part of management that is concerned with all aspects related to people who do the work of, in and for all the organisations in society. In their opinion, HRM is rooted in work as a socio-economic human activity and is performed mainly in the context of organisations. Activity By looking at the above definitions of HRM determine what the concept “strategy” means and discuss how important strategy is for HR practitioners in managing human resources. Do this by logging onto myUnisa, going to the Discussion Forums option on the HRM1501 module site and selecting Forum 2: Workbook 01 Activities. Here you will find all the discussion activities for Workbook 01. Post your views online and also see what your fellow students have to say. This is an ideal opportunity to share ideas and interact. It has been mentioned earlier that HR practitioners have the responsibility to ensure that the skills and abilities, inborn talents, past experience and educational qualifications inherent in employees are used to benefit both the employees and the organisation. On its own, this is not sufficient. An organisation is part of the bigger system and it is influenced by factors in both the internal and the external environment in many different ways. The internal organisational environment refers to the organisation itself and all the activities happening within, for example, the mission and vision, organisational policies and 4 HRM1501/1 procedures, goals and objectives, strategies to achieve the goals and abilities as well as the management style of managers in that organisation. Factors in the external environment are likely to have either a direct or an indirect influence on the organisation and on HRM in general, for example, the economic factors, the social factors, the technological factors, the politico-governmental factors as well as the physical or the structural factors. Economic factors include the rand-dollar relationship, the rate of inflation, the changing prices of goods and products as well as rising and falling interest rates. Social factors focus on society’s changing tastes in products and services, the affordability of and its willingness to purchase such products and services. Technology makes it possible for people to perform tasks faster, produce products of good quality and render services of an above-average standard. The politico-governmental factors are concerned with the management of the employment relationship in the workplace. The basic relationship is the contract entered into between the employer and the employee. This relationship often results in conflict with employees, eventually resorting to strikes or industrial action. When conflict occurs, employees join trade unions to counter-act the power of the employer, the owner and controller of the economic resources. The government plays a role in regulating this relationship by promulgating legislation, policies and procedures. Physical or structural factors refers to the land and office space whre HR practitioners can meet and products and services can be produced. 1.3 THE ROLE AND PLACE OF HRM IN ORGANISATIONS According to Wärnich, Carrel, Elbert and Hatfield (2015:14), the primary task of the HR department is to ensure that the organisation’s human resources are utilised and managed as effectively as possible within an ever-changing work environment. HR administrators help design and implement policies and programmes that enhance human abilities and improve the organisation’s overall effectiveness (Wärnich et al 2015:14). It is clear that HRM plays an important role in ensuring that the organisation has people with the right skills and abilities to make it effective and successful. HRM is mainly concerned with ensuring that the right mix of people is available when needed through a process known as HR planning. For more information on HR planning, please refer to Workbook 05. HRM as a management function has a direct influence on the success of every organisation. According to Wärnich et al (2015:15), in the study of successful rapid-growth companies, as identified by Inc. Magazine in the USA, it was found that these companies were generally able to use the HR function to solve problems and achieve success in the following ways: y y y y y y y having HR directors reporting to the general manager placing major emphasis on employee recruitment, selection and training using team-building and creating an environment of rapid decision-making at lower levels communicating key company performance objectives through all programmes and linking them to goals at all levels including HR planning as part of management’s strategic planning involving line managers and working with them in a team to manage employees more effectively using technology to assist where necessary 5 1.4 THE HRM MODEL The early HRM models focussed mainly on the four functional components of HRM, namely selection, performance appraisal, employee training and development, and employee benefits and rewards. The shortcomings of such models were that they neglected stakeholder interests, situational factors and the HR managers’ strategic choice (Joubert, Nkosi, Steenkamp & Molatsane 2014). According to Torrington, Hall, Taylor and Atkinson (2009), in 1984, two seminal works on HRM were published. One aimed at promoting a “soft” version of HRM was developed at Harvard Business School by Beer et al (1985). This, the Harvard model of HRM, starts by analysing stakeholder interests in the business’s situational factors. It provides a map of the determinants of HR policy choices and HR outcomes for developing employee commitment in organisations. HR policy choices include employee influence and rewards. HR outcomes include employee commitment, competence, congruence and cost-effectiveness. In the mode, business strategy is developed in relation to employee needs, with the long-term consequences of HRM being individual, organisational and societal wellbeing. The other important work was the Michigan model of HRM promoted by Fombrun et al (1984). This, the “hard” version of HRM, emphasises the importance of having a tight “fit” between HR strategy and business strategy. This model defines and determines the types of employee performance required by organisations. The aim of this model was to improve overall organisational performance with the underpinning goal of creating a strategically based value system promoting high employee performance (Torrington et al 2009). Figure 1.1 provides a schematic representation of the Harvard HRM model. Figure 1.1: The Harvard Model of HRM (Adapted from Bratton and Gold 2007) 6 HRM1501/1 The above HRM model demonstrates a systems theory orientation in which the output of one component serves as input for the next component. A system is a number of related elements that are coordinated to reach a common goal. From an organisation’s perspective, inputs represent the four factors of production which need to be explored through some processes, for example machines and other means of technology, for output to occur. Examples of output are products and services as well as profitability. y y y y y y Stake holder interests: The stakeholders of an organisation include shareholders, clients, employees (trade unions), management (employer’s organisations), the government, the community (national as well as international). Stakeholder interests determine the manner in which employees are managed in organisations. For example, if the government fails to provide social security, employees will provide their own life assurance policies, retirement pension and health benefits (Coetzee et al 2011). Situational factors: Situational factors may include things such as workforce characteristics, organisational/business strategy, management philosophy, labour market, trade unions, technology, legislation and societal values. These factors influence the manner in which employees are managed. For example, workforce characteristics such as ethnicity, age and educational levels have a direct influence on remuneration packages, recruitment practices and employee training and development (Coetzee et al 2011). HRM policies: Labour legislation and trade unions influence the manner in which reward systems are structured which in turn influence pay policies. The expansion of every organisation will have a direct influence on the overall strategy of such an organisation, for example, its recruitment policy as well as its HRM strategy. This means that, during high unemployment levels, the selection criteria may be applied very strictly (Coetzee et al 2011). HRM outcomes: HRM outcomes refer to the overall objectives of the organisation and include commitment, competence, congruence and cost effectiveness. All HR objectives should focus on outcomes that provide the organisation with a competitive advantage (Coetzee et al 2011). Long-term consequences: Long-term consequences include employee wellbeing and organisational effectiveness. It is known that employees work hard if they can benefit from doing this. This is the reason why employee wellbeing should be categorised as a long-term objective. Long-term objectives are manifested in three levels, that is, individual, organisational and societal objectives. At individual level, long-term outputs comprise the psychological rewards, for example, recognition, responsibility, growth and achievement that individual employees receive in exchange for their efforts. At organisational level, increased effectiveness ensures organisational survival while at societal level, growth and employment are likely to be attained (Coetzee et al 2011). Feedback loop component of Harvard model: The feedback loop is the last component of the Harvard model. In this component, we witness how the situational and stakeholder factors influence HRM policy and choices, and how long-term outputs can influence the situational and stakeholder interests, as well as HRM policies. Although the Harvard model is a good point of departure, let us have a look at the South African HRM model which is more relevant to our South African work environment: 7 Figure 1.2: South African model of HRM: National Standards (Reprinted with kind permission of SABPP) The above model contains 12 standard elements grouped according to the classic quality assurance model of plan, implement, review and improve. 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. Strategic HR management Talent management HR risk management Workforce planning Learning and development Performance management Reward and recognition Employee wellness Employment relations Organisation development HR service delivery HR technology As you progress through this and other HRM modules during your studies, you will encounter each of these elements of modern HRM practice. At present this serves as an overview of the functional HRM competency areas that you may be involved in as an HRM practitioner in an organisation. These standards also summarise the role that the HRM function plays in supporting the achievement of organisational goals and strategies through its human capital. 8 HRM1501/1 Activity Log onto the internet and visit the websites of the South African Board for People Practices at and the UK’s Chartered Institute for People Development (CIPD) at . Browse through some of the links for an overview of what the HRM profession is all about. • • Are you excited about the prospect of becoming part of this world of HRM? Is this what you expect from your professional career in HRM? Use the link below for an interesting insight into the role of HRM in future organisations: /research/changing-hr-operating-models/executive-summary.aspx Boxall and Purcell (2011) have identified four underpinning motives of HRM: y y y y Cost-effectiveness: This refers to managing HR functions within budgetary constraints or ensuring that profitability is maximised. Legitimacy: This refers to managing employees in an ethical and morally legitimate manner. Flexibility: This refers to ensuring that HRM is conducted in such a manner that the organisation remains flexible, adaptable and agile. Autonomy: This refers to ensuring that HRM provides organisational management with the necessary skills and tools to manage with autonomy. According to Grobler, Wärnich, Carrel and Hatfield (2011), the adoption of the HR approach is an emerging field in HRM and comprises the following principles: y y y Employees are investments and should be managed is such a way that they provide long-term rewards to the organisation. Policies, programmes and practices must support the economic and emotional needs of employees. The working environment must promote development and allow employees to utilise their skills. Activity Consult the recommended text book (Joubert et al 2014:2–3) for further reading. Discuss the four motives of HRM and share your opinions with your group by logging onto myUnisa, going to the Discussion Forums option on the HRM1501 module site and selecting Forum 2: Workbook 01 Activities. Here you will find all the discussion activities for Workbook 01. Post your views online and also see what your fellow students have to say. This is an ideal opportunity to share ideas and interact. Feedback y Cost-effectiveness: This refers to managing HR functions within budgetary constraints or ensuring that profitability is maximised. 9 y y y Legitimacy: This refers to managing employees in an ethical and morally legitimate manner. Flexibility: This refers to ensuring that HRM is conducted in such a manner that the organisation remains flexible, adaptable and agile. Autonomy: This refers to ensuring that HRM provides organisational management with the necessary skills and tools to manage with autonomy. 1.5 FUNCTIONS AND ACTIVITIES OF HRM HRM, as one of the seven functions of management, has already been discussed in section 1.3. In this section, we discuss the remaining six functions which include general management, financial management, production and operations management, marketing management, purchasing management and public relations. General management General management is a function of management which is concerned with the planning, organising, leading and controlling of the various functions and activities in an organisation. Financial management The fina...
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