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HR Summaries Chapter 3

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20 views3 pages

HR Summaries Chapter 3

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eenymeenys501
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Chapter 3: HRM and Business Effectiveness

High Performance Organisations


Comprehensive customer driven system that aligns all of the activities in the organisation with the
common focus of customer satisfaction through continuous improvement in the quality of good and services
High Performance Work Systems
Typical Characteristics:
 Changing the design and conduct of jobs through Flexible Working, team work, quality circles,
suggestion themes(Who does what)
 Knowledge and Competence of employees to handle high performance work, through teamwork
training.
 Resourcing and Development practices designed to attract and keep the right people with the right
motivation
Key Performance of High Commitment Managers (Pfeffer 1998)
 Build Trust – Everyone in organisation can share knowledge
 Encouraging Change
 Measuring What Matters – financial data tends to be historical rather than what matters now. Use
‘Balanced Scorecard’, a technique that weighs non-financial criteria
Balanced Scorecard
A conceptual framework used to translate an organisations vision into a set of performance indicators,
including measures of financial performance, customer satisfaction, internal nosiness processes and
learning & growth. Both current performance and efforts to learn and improve can be monitored using these
measures
Pfeffer (1998) Model of High Performance Work Systems Include 7 Key Factors:
1. Employment Security: Gain Employee Commitment
2. Selective Hiring: Competency Based Selection
3. Self-Managed Team: Replacing Traditional Supervision with peer control (see how their work affects
the work of other employees)
4. High Compensation Contingent on Performance: Fairly rewarded make employees more likely to
show commitment – Gain Sharing, Stock Options
5. Training: Up to date skills and knowledge makes employees more flexible and prepared to initiate
change
6. Reduction of Status Differences: Egalitarian workplace encourages open lines of communication,
inducing greater sense of common purpose
7. Sharing Information: Making financial information available to employees encourages trust and
commitment to company
Key Operating Practices of High Performance Systems:
 Leadership and support from top levels of management:Top managers must develop a climate of
trust where risk taking and innovation are encouraged and rewarded
 Strategic Planning:Mapping out how the organization will achieve its strategic objectives
 Ongoing Commitment to Training & Development for all Employees:Do not neglect training and
development of customer facing staff is potentially damaging
 Focus on Customer: Exceeding customer satisfaction
 Focus on Quality: Dealing with problems as they occur and providing a perfect end product.
 Empowering Employees and emphasis on Teamwork: Harness intelligence and energies of your
employees.
 Developing Measures of Progress: Data Collection mechanisms to ensure that customers are
receiving reliable and satisfactory service and that internal processes are functioning properly
Problems in Non-Manufacturing Sectors(Service Sector)
 High performance is easier to understand in manufacturing than in service.
 Competitiveness is a main motivating factor in the private sector but scarcely considered in the
public sector.
 Government is viewed as archetypal, inflexible, hierarchical structure and therefore incapable of
change.
 Outcomes not easy to measure in the service sector(eg Production costs, improved market share)
Implicit Theory
An internal or mental model of how or why a set of events or behaviours take place. A belief system
developed by individuals to explain part of their world or organization based on their own interpretations
and experiences.
Evidence from Survey Research on Relationship between HR Practices and High Performance
 Evidence is not conclusive
 Relatively weak relationships
 Language used too dramatic
 Reliance on single-source measure of HRM practices such as CEO or HR Manger(Often unknown
unreliability, sensitivity, and validity and are typically the only source of measure of performance)
 Use of Small samples couples with low response rates(Larger sample sizes are essential to reveal
the effects of complex interactions predicted from theory)
 Lack of Sophisticated Longitudinal Studies(Studies to examine how changes in HR practices relate
to subsequent changes in performance - can be retrospective or prospective)

HRM and Business Effectiveness

In order for Use of technology in HR to be considered successful, should achieve the following:

 Strategic Alignment: Must help users in a way that supports users


 Business Intelligence: Must provide users with relevant information and data, answer questions and
inspire new insights and learning.
 Efficiency & Effectiveness: Must change the work performed by HR personnel by dramatically
Improving their level of service, allowing more time for work of higher value and reducing their costs.

HR Technology Options

1. Workflow: Email with a database and built-in intelligence. User accesses a range of employee
records through a computer terminal (Only authorised personnel can access).
2. Manager Self-Service: Mangers have access to front-end applications in the form of HR portals. To
view a range of personnel details.
3. Employee Self-Service: Employees can view company information, change selected personal
details, make benefit enquiries.
1. Interactive Voice Response: Low-tech method, using push button control facility found in most
modern telephones. Restricted but easy to use and inexpensive.
2. HR Service Centres: Centralize a number of HR processes & may deal with geographically wide
spread users.
3. Human Resources Information Systems(HRIS): Primary Transaction processor, editor, record
keeper and functional applications system which lies in the heart of all computerized HR work.
4. Stand-Alone HR Systems: Online application forms, tests, appraisal databases, 360 degree
performance assessment.
5. Data-Marts and Data-Warehouses: Source of information usually held as relational databases which
can be interrogated. Data-marts normally hold data from single sources, such as HR; Data-
warehouses amass information from multiple sources.

HR Professional and the HR System

'Best -In-Class' Cover

 Payroll
 Benefits
 Health & Safety
 Compliance
 Taxes
 Employee Records/ HR Data
 Time & Attendance & Scheduling

Measuring the Impact of HRM

Benchmarking: Direct comparisons of different measures between an organisation and 'best practice'
competitors in the same business sector. This indicates the gap in performance, costs, morale between
that organisation and industry best practice.

Best Practice Findings

 Coordinate HR Roles and Responsibilities: Most benchmark companies assign corporate human
resource functions the following responsibilities: Managing benefits, leadership development &
compensation
 Centralize HR Performance Measurement: Every benchmark company monitored their
competitiveness for compensation/ benefits, and over half tracked their overall headcount,
employee turnover rates, & safety incidents.
 Maximize use of Staffing and Budgeting Resources: Ratio of Employees to HR generalist.
Companies at the high end of the spectrum run the risk of short changing some of the tasks
assigned to generalists
 Self-Service Technologies: Increasingly creating HR call centres and incorporating self-service HR
software programmes.

A 10 C Checklist for Effective HRM

1. Comprehensive
2. Coherence
3. Control
4. Communication
5. Credibility
6. Commitment
7. Change
8. Competence
9. Creativity
10. Cost - Effectiveness

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