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HRM Study Guide - Questions Chapter 2 will help managers...

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Questions Chapter 2 will help managers answer How can HR measures improve talent-related decisions in organizations? What factors should I consider to calculate the cost of employee turnover? What’s the business case for work-life programs? Is there evidence that high-performance work policies are associated with improved financial performance? How do we cost HRM? Direct measures refer to the actual costs, such as the accumulated, direct cost of recruiting. Indirect measures do not deal directly with cost; they are usually expressed in terms of time, quantity, or quality. Indirect measures have value in and of themselves, and they also supply part of the data needed to develop a direct measure. Controllable Costs and Uncontrollable Costs To the extent that people leave for reasons of “better salary,” “more opportunity for promotion and career development,” or “greater job challenge,” the costs associated with turnover are somewhat controllable. If turnover is due to such factors as death, poor health, or spouse transfer, the costs are uncontrollable. Behavior Costing The behavior-costing approach to employee attitude valuation is based on the assumption that measures of attitudes are indicators of subsequent employee behaviors. Behaviors can be assessed using cost-accounting procedures, and they have economic implications for organizations. Employee Attitudes Attitudes are internal states that focus on particular aspects of or objects in the environment. Elements include cognition, emotion, and action Examples of Attitudes Job Satisfaction – is a multidimensional attitude; it is made up of attitudes toward pay, promotions, coworkers, supervision, the work itself, and so on. Organizational Commitment – a bond or linking of an individual to the organization that makes it difficult to leave. Sears applied behavior-costing methodology to study the relationship between employee attitudes, customer behavior, and profits They found how employee attitudes drove not just customer service, but also employee turnover and the likelihood that employees would recommend Sears. An employee’s ability to see the connection between his/her work and the company’s strategic objectives was a driver of positive behavior. Process: Impact on Mangers’ Behavior and on the Firm Sears now bases all long-term executive incentives on the TPI (total performance index). Across other types of organizations, the direction of causality may not be as clear as it is in retailing. It may well be that the financial performance of a firm predicts satisfaction with security and overall satisfaction, rather than vice versa.
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Training Costs Information Literature Instruction in a formal training program Instruction by employee assignment Absenteeism : Any failure of an employee to report for or to remain at work as scheduled, regardless of reason In 2005, the cost of unscheduled absences in U.S. workplaces was about $660 per employee per year.
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