Chapter 1 To Chapter 14

Human Resource Management
Angelo S. DeNisi &

Ricky W. Griffin
The Nature of Human Resource Management
CHAPTER 1
Copyright © Houghton Mifflin Company. All rights reserved. PowerPoint Slides by Charlie Cook
Learning Objectives
 Describe contemporary human resource
perspectives
 Trace the evolution of the human resource function
in organizations
 Identify and discuss the goals of human resource
management
 Discuss the setting for human resource
management
 Describe the job of human resource managers from
the perspectives of professionalism and careers
Copyright © Houghton Mifflin Company. All rights reserved. 1-2

 Human Resource Management (HRM)
 The comprehensive set of managerial activities and tasks
concerned with developing and maintaining a qualified

workforce–human resources–in ways that contribute to
organizational.
What is Human Resource Management HRM.mp4
 What is Human Resource Management.mp4
 Effective human resource management is a vital strategic
concern for organizations today.

Evolution of the Human Resource Function
 Scientific Management
 First serious study of management practice focused on
structuring individual jobs to maximize the efficiency and

productivity of workers.
 Frederick Taylor and Frank and Lillian Gilbreth used time
and motion studies of each job task to develop “the one

best way” (production standards) to do the job.

Evolution of the Human Resource Function
 Origins of the Human Resource Function
 Growth in the size and complexity of firms resulted in the
creation of specialized units to hire new employees and,

later on, to manage the existing workforce as well.
 Managerial time became more devoted to labor relations
and the administration of legal and regulatory matters.

The Human Relations Era
 Human Relations Movement
 Became the dominant management approach in the 1930s.
 The results of Roethlisbeger and Mayo’s Hawthorne

studies at Western Electric demonstrated the importance
of understanding human behavior in the workplace.
 Workers were no longer considered tools but people.
 Important contributors to the human relations movement:
 Abraham Maslow and his “hierarchy of human needs”

 Douglas McGregor and his “Theory X and Theory Y”
framework
 The managerial premise for human relations shifted from
treating workers as output resources to making workers
happier and more satisfied; this change was intended to
make them want to work harder and be more productive.

Personnel Management
 Personnel Departments
 By the 1940s, specialized units run by personnel managers
were common in large organizations.
 Primarily responsible for hiring first-line employees and
administering basic HR activities such as pay and benefits.
 During the 1940s and 50s, personnel management evolved
increasingly toward developing testing techniques for
optimizing the fit between people and jobs.
 Were generally regarded as a limited, routine-oriented
support function within organizations and not accorded any
strategic importance. Also were considered a “dumping
ground” for superfluous, poor, and non-promotable
managers.

Contemporary Human Resource Management
 During the 1960s and 1970s, firms began to recognize the
increasing strategic importance of effective HRM practices to
productivity and competitiveness.
 The HRM function–building a motivated and committed

workforce–reached its maturity as firms focused on
maximizing effectiveness and making work more meaningful
and fulfilling.
 The 1980s and 1990s era of mergers, takeovers, acquisitions,

and marketplace globalization led to the downsizing,
rightsizing, or reengineering of firms. Outsourcing of
traditionally internal functions, including HRM staff activities,
by firms became commonplace.

The Human Resource Management Process
Strategic human resource perspective
The legal The global
environment environment
Human resource planning
Recruiting human resources
Selecting and placing human resources Basic compensation

and benefits
Performance management Incentives
Training and Development Career Planning and Development
Managing the Managing Managing new

Managing labor
work diverse employment
relations
environment workforce relationships
Effective and efficient human resource practices; human resource goal attainment

A Systems View of Human Resource Management
The Organizational System

The marketing
function
The human
The finance The operations
function
resource function
function
Other fundamental
organizational
functions

Goals of Human Resource Management
Facilitating Enhancing
organizational productivity
effectiveness and quality
The human
resource function
in contemporary
organizations
Complying with Promoting

legal and social individual growth
obligations and development

Line vs. Staff Perspectives
 Organizations typically divide managers into two
groups:
 Line (now operating) managers in operations, finance, and
marketing functions supervise and direct the workforce in the
creation of goods and services. Their contributions to the
organization can be measured directly.
 Staff managers in legal, accounting, and HR departments
perform indirect or support functions, which makes their
contributions less easily measured directly.
 HR departments are assigned staff functions and staff
responsibility. HRM activities are distributed throughout
organizations, yet HR departments are responsible for
monitoring and ensuring organizational compliance with laws,
regulations, policies, procedures, and rules.

Smaller vs. Larger Organization Perspectives
 Smaller organizations make extensive use of
operating managers to carry out HRM functions.
 A single manager may handle all basic HR functions–
hiring, work scheduling, discipline.

 Very small firms are exempt from many legal regulations.
 Certain HR functions may be subcontracted out.

Smaller vs. Larger Organization Perspectives
 HRM in large firms is handled by a self-contained
separate organizational unit of HR specialists.
 The HR department may be divided into distinct subunits
that handle specific HR administration activities and

functions such as recruiting and selection, wage and salary
administration, training and development, and labor
relations.

The HRM Function at Texas Instruments
Vice President,
human resources
Director, Director, Director, Director, Director,

recruiting compensation training/ employee leadership
and staffing and benefits development relations development

HRM as a Center of Expertise
The Organizational System

The marketing
function
The human
The finance resource function The operations
function as a center of function
expertise
Other fundamental
organizational
functions

Professionalism and HRM
 What it takes to become a successful HRM
professional:
 a solid educational background;
 general management skills and abilities reflecting
conceptual, diagnostic, and analytical skills;

 a fundamental understanding of functional areas of business;
 knowledge of business and corporate strategy; and
 an understanding of the role and importance of the human
resource function for one’s organization.

Functional Areas of HRM
 Typical HRM Functions:
 Recruitment, Selection and Placement
 Compensation and Benefits
 Employee and Labor Relations
 Training and Development
 Human Resource Planning

Professionalism and HRM
 Professional associations and certification:
 Society for Human Resource Management (SHRM)
 Human Resource Certification Institute (HRCI)

LAST OF CHAPTER ONE
Copyright © Houghton Mifflin Company. All rights reserved.

Angelo S. DeNisi &
Ricky W. Griffin
The Strategic Human Resource Environment
CHAPTER 2
Strategic Human Resource Management
Organizational mission, SWOT analysis Corporate and
top management team business strategies
Human resource strategy formulation

Top management
Formulation of
oversight and
other functional
strategic Staffing Development Compensation strategies
leadership strategy strategy strategy
Organization design Organization culture
Technology Work/labor force
Human resource
strategy implementation Implementation of
other functional
strategies
Organizational
Individual Interpersonal/
systems and
Process group processes
processes
Organizational effectiveness; attainment of strategic goals

Organizational Purpose and Mission
 An organization’s purpose is its reason for
existence.
 A business’s purpose is to earn profit for its owners.
 A university’s purpose is to educate and pursue knowledge.
 An organization’s mission statement specifies how

its managers have decided to fulfill its purpose.
 It identifies the unique set of characteristics and strengths
of the organization that are its competitive advantage and

 It defines the scope of business operations in the provision
of products and services offered and the markets in which

it intends to compete.

Mission Statement
STARBUCKS MISSION STATEMENT
To establish Starbucks as the premier purveyor of the finest coffee in the

world while maintaining our uncompromising principles as we grow.
The following five guiding principles will help us measure the
appropriateness of our decisions:
• Provide a great work environment and treat each other with
respect and dignity.
• Apply the highest standards of excellence to the purchasing,
roasting and fresh delivery of our coffee.
• Develop enthusiastically satisfied customers all of the time.
• Contribute positively to our communities and our environment.
• Recognize that profitability is essential to our future success.
Courtesy—Starbucks Coffee Company.

Influence of the Top Management Team
 The top management team of an organization refers to
the group of senior executives responsible for the
overall strategic operation of a firm:
 Chairperson of the board of directors
 Chief Executive Officer (CEO)
 Chief Operating Officer (COO)
 Chief Financial Officer (CFO)
 President of the firm
 Senior executives responsible for each major functional area
 Top management’s clear communication of the

strategic vision sets the tone for the organization and
plays a major role in shaping its culture.

SWOT Analysis
Strengths Internal Analysis Weaknesses
Strategic
Actions
Opportunities External Analysis Threats
Accomplish the strategy by exploiting opportunities with strengths,

correcting weaknesses, and building defenses against threats.

Strategy Formulation
 Organizations formulate strategy at three basic
levels:
 Corporate strategy
 The set of strategic alternatives that an organization chooses

when managing operations across several industries and
diverse markets.
 Business strategy
 The set of strategic alternatives that an organization selects
from in deciding how to compete in a particular industry.
 Functional strategy
 How a firm has decided to manage each of its major internal
functions such as marketing, finance, distribution, and
human resources.

Corporate Strategy and HRM
 A grand strategy is a single overall framework for action
the top management team develops to compete in one
market or a few closely related markets.

 Growth strategies:
 Niche:
 Identifying a unique niche in a market and then succeeding in

aggressively expanding within the chosen niche.
 External
 Growth through acquisition, mergers, and joint ventures.
 Strategic HRM challenges under growth strategies:
 To successfully recruit and train sufficient numbers of qualified
employees to operate expanding niche operations.
 In external growth, HRM focuses on melding disparate
workforces into a single cohesive and integrated unit.

 A retrenchment or turnaround strategy is a grand
strategy utilized when major changes in current
operations are required to make an organization
competitive again.
 Downsizing or “rightsizing”
 Actions taken to reduce costs and scale back operations,

thus freeing up resources for investment in more promising
products and markets.
 Strategic HRM challenges during this “period”:
 To manage the process so that surviving employees feel
attached to and remain committed to the organization.
 To optimize the transition process for displaced workers
through severance packages and outplacement counseling.

 A stability strategy focuses on maintaining the
status quo after a period of change in an
organization.
 The strategy’s goals are to stay in current markets (where
no growth is anticipated) and to protect the organization

from external threats.
 Strategic HRM challenge of the stability strategy:
 To retain the firm’s existing employees when there are few

chances for advancement, no likelihood of compensation or
salary increases, and other HR negative factors.

 Diversification is a widely used strategic approach to
managing a portfolio of businesses competing in
several different markets at once.
 Related diversification:
 The relatedness of the businesses (e.g., internal operations,

suppliers, customers, locations) is used to achieve cost savings or
profit synergies and competitive advantage.
 HR practices focus on cross-organizational training and
experiences to develop overall organizational perspective.
 Unrelated diversification:
 The diversity of the businesses (no overlapping as in a related
diversification) is assumed to offer protection from business cycle
downturns.
 HR functions under unrelated diversification are customized and
decentralized to the particular business units.

Business Strategy and HRM
The Adaptation Model
Reactor
Little consideration
of environment; drift
with little concern
for strategy
Prospector Analyzer Defender

Stress maintenance Stress stability,
Stress innovation
of status quo with conservatism, and
and growth; seek
moderate innovation maintenance of
new opportunities
and growth status quo
Environmental Turbulence
Dynamic, growing Moderately stable Very stable
environment environment with environment with
characterized some uncertainty little uncertainty
by high uncertainty and risk and risk
and risk
 Competitive Strategies
 Differentiation:
 A firm develops an image or reputation for its product or

service that sets it apart or causes it to be perceived as
being different from its competitors.
– HRM activities focus on developing high quality work and customer
service satisfaction capabilities in the workforce.
 Cost Leadership:
 By minimizing costs, a firm can offer the lowest prices and
gain higher revenues. Cost leadership comes from internal
operational efficiencies and external cost controls.
– HR activities focus on developing a highly efficient workforce and
reengineering operations for higher productivity and lowered labor
costs.

 Competitive Strategies (continued)
 Focus:
 Targeting a differentiated product or service with low cost or

unique features for a specific market segment by geographic
locations, by consumer preference, or by other distinct
customer characteristics.
– HR activities are focused on creating a workforce that understands the
competitive nature of the focal market.

Functional Strategy and HRM
 The third level of strategy concerns how a company
will decide to conduct its basic functional activities,
such as marketing, finance, operations, research
and development, and human resources.
 HR strategy formulation should be integrated with
corporate, business, and other functional strategies.

Human Resource Strategies
Human resource
strategy formulation
Staffing strategy Development strategy Compensation strategy

•HR Planning •Performance management •Wage/salary structure
•Recruiting •Training •Employee benefits
•Selection •Development •Incentives
•Placement •Career planning

Functional Organization Design (U-Form)
CEO
V ice P resident V ice P resident V ice P resid ent V ice P resid ent V ice P resident
O pera tio ns M a rketing Fina nce H um a n R esources R&D
P la nt R eg io na l S a les C ontro ller L a bo r R ela tio ns S cientific

M a na gers M a na g er D irector D irecto r
S hift D istrict Acco unting P la nt H um a n Lab

S upervisors S a les M a na g ers S upervisor R esource M a na ger
M a na g er

Conglomerate Organization Design (H-Form)
CEO
P erio d ica ls P ub lishing E nterta inm ent Investm ent O il S ervices F ine C hina
O pera tio ns O p era tions O pera tio ns B a nking O pera tio ns O p era tio ns
O p era tions
Divisional Organization Design (M-Form)
C EO
S tructure B a th & B o d y T he L im ited E xpress L erner V icto ria 's O ther

W o rks N ew Yo rk S ecret C ha ins

Determinants of Corporate Culture
Fo
Vi un red
si de h a es
on r’ S nc
s r ie
p e
Ex
Culture
(values)
Sy
s , ies m
oe on St bo
er m or ls,
H re ie
Ce s

Technology and Organization Design
Manufacturing
Organizations
 combine and transform
resources into tangible
outcomes that are then sold
to others.
Service
Organizations
City
Bank
 transform resources into
intangible outputs and
create time and place utility
for their customers.

Labor Trends and Workplace Issues
 Workforce diversity
 Age
 Gender
 Ethnicity
 Disabilities
 Lifestyles
Vote Unfair
Strike
 Unionization and
collective bargaining
 Union membership
 Organizing drives
 Strikes
Human Resource Strategy Implementation
Human resource
strategy implementation
Individual Organizational Interpersonal

processes systems/processes processes
•Psychological •Single-use plans •Group dynamics
Contracts – programs •Leadership
•Personality traits – projects •Communications
•Attitudes •Standing plans
•Motivation – policies
Equity Theory – standard operating
Expectancy Theory procedures
Reinforcement – rules
•Stress

High Performance Work Systems
 Human resource practices that may lead to improved
firm performance
 Self-directed work teams
 Attitude surveys
 Information sharing (e.g., newsletters)
 Contingent pay
 Favorable selection ratio (i.e., many applicants for each
opening in the firm)

 Formal performance appraisal
 Social events

LAST OF CHAPTER TWO

Angelo S. DeNisi &
Ricky W. Griffin
The Legal Environment
CHAPTER 3
 Describe the legal context of human resource
management;
 Identify key laws that prohibit discrimination in the
workplace and discuss the equal employment
opportunity;
 Discuss legal issues in compensation, labor relation,
and other areas in human resource management;
 Discuss the importance of evaluating its legal
compliance

Legal Regulation of HRM
Prospective Employees
Protection from discrimination in selection,

initial job placement, and initial
compensation
Current Employees
Protection from discrimination in performance appraisal,

subsequent job placement, training and development
opportunities, career and promotion opportunities, and all
other dimensions of work in the organization

The Regulatory Environment of HRM
 Creation of national, state, and local regulations
 New laws and statutes enacted at the national level are
adopted or extended by state and local government bodies.
 Enforcement of regulations
 The regulatory process is carried out through existing or
special agencies, regulatory groups, and the court system.
Fines and lawsuits are used as enforcement tools.
 Practice and implementation of regulations
 Organizations and managers must put into practice and
adhere to the guidelines and regulations that the courts and
regulatory agencies attempt to enforce. Compliance with
the regulatory process can be hindered by the ambiguity
and differing interpretations of the intent of new
regulations.

Equal Employment Opportunity
 Thirteenth Amendment (1865)
 Abolished slavery.
 Fourteenth Amendment (1868)

 Required the government to follow
due process and prohibited the individual

states (but not private employers) from
denying equal protection to their residents.
 Reconstruction Civil Rights Acts (1866 and 1871)
 Extended protection offered to people under 13th and 14th
Amendments. Granted the same property rights to all

citizens and established the right of individuals to sue in
federal court if deprived of their civil rights.

Protected Classes in the Workforce
 Protected Class
 Classes or categories of individuals who share
one or more common characteristics as defined

by the various laws enacted to protect against
employment discrimination.
 Race, color, religion, gender, age, national origin,
disability, and military veteran status are class

definitions that distinguish groups specifically
protected from discrimination.

Forms of Illegal Discrimination
Disparate Disparate
impact treatment
Forms of
illegal
discrimination
Pattern or
Retaliation
practice

Discrimination and Equal Employment Opportunity
Disparate Treatment Employers cannot consciously treat
Discrimination protected class individuals differently
from others.
Bona Fide Occupational Employers must prove that a

Qualification discriminatory employment
(BFOQ) preference is a business necessity.
Disparate (Adverse) The effect of an apparently neutral

Impact employment practice that results in
the disproportionate selection of the
majority group over protected class
candidates.
Four-fifths Rule Disparate impact exists when the

selection rate for protected class
candidates is less than four-fifths
(80%) of the selection rate for the
majority group.
Equal Employment Opportunity Legislation
Civil Rights Act Prohibits discrimination on the

(Title VII) 1964 basis of race, color, religion, sex,
national origin; created the EEOC
Executive Orders 11246, Prohibits discrimination by federal

11478 contractors; requires AA plans
Equal Pay Act 1963 Requires equal pay for equal work
(men and women)
Age Discrimination and Protects persons over 40 years of

Employment Act 1967 age from discrimination
Vocational Rehabilitation Requires affirmative employment

Act 1973 for disabled by federal contractors
Vietnam Era Veterans’ Requires affirmative employment

Readjustment Act 1974 for veterans by federal contractors

Equal Employment Opportunity Legislation
Pregnancy Discrimination Requires equal treatment of

Act 1978 pregnant women in the workplace;
preserves job rights after leave
Civil Rights Act 1991 Provides compensatory and

punitive damages for intentional
discrimination; covers overseas
employees of U.S. companies
Americans with Disabilities Prohibits discrimination against

Act (ADA) 1990 disabled persons (physical and
mental); requires reasonable
accommodation of disability
Family and Medical Leave Provides up to 12 weeks of unpaid

Act 1993 leave for infant care and illness;
protects employment rights and
benefits during leave

Enforcing Equal Employment Opportunity
Charge Filed
Copy to Deferred
Employer to State
EEOC Investigation
Dismiss Charge Reasonable Cause Settlement
Individual Conciliation No Filing

Files Suit (180 days)
w/o EEOC Individual
Files Suit
Consent Decree Unsuccessful
Federal District Court

Investigating & Resolving a Discrimination Complaint
Does Claim Have Merit?

No Yes
Agency finds probable cause that

EEO agency drops case
employer violated Title VII
Party can file a private Agency seeks conciliation

lawsuit against employer agreement (out-of-court settlement)
Is Case Important and No Does Conciliation Succeed?

Is Agency Likely to Win?
No Yes Yes
Case is EEOC litigates case Agreement is carried

dropped in federal court out and case is dropped

Discrimination Case in Court
Prima facie case

established; burden of proof
Does the Current System of
shifts to defendant to prove Yes Promotion Result in Fewer Qualified
innocence Women Being Promoted?
Defendant argues that plaintiff was not No

promoted for a nondiscriminatory reason
Prima facie case not established;

Plaintiff argues that this reason is a pretext plaintiff must prove some type of
and that the real reason was discrimination intent to discriminate
Does the Judge/Jury Is There Evidence of Some

No
Believe Plaintiff? Intent to Discriminate?
No Yes Yes No
Plaintiff Plaintiff wins case and may Plaintiff

loses case be entitled to damages loses case
Affirmative Action Plans
Utilization Develop Goals Develop List of

Analysis and Timetables Action Steps
comparing of non-quota specifying how
employer’s flexible goals for the organization
workforce matching internal will make efforts
composition conditions to the to reduce under-
to available external labor utilization of
labor supply market protected classes

Legal Issues in Compensation
Fair Labor Standards Act Established minimum wage and 40-

(FLSA) 1938 hour work week; overtime paid at 1½
normal wage after 40 hours
Non-exempt employees FLSA provisions apply primarily to

non-exempt employees who work on
an hourly basis
Exempt employees Executive, professional,

administrative, and outside sales
employees paid on a non-hourly
basis are exempted from FLSA
regulations on compensation
Employee Retirement ERISA provides protection for

Income Security Act 1974 employee pension benefit funds

Legal Issues in Labor Relations
 National Labor Relations Act (1935)
 Sought to counter the power of organizations by
establishing the rights of workers to organize and setting up

the process for electing representative unions with which
employers must bargain.
 Taft-Hartley Act (1947)
 Rebalanced the labor relations power relationship by
requiring the same labor relations obligations for labor as

for management.
 Landrum-Griffin Act (1959)
 Regulated the internal affairs of unions to ensure their
honest and democratic operation.

Employee Safety and Health
 Occupational Safety and Health Act (1970)
 OSHA was passed as comprehensive legislation that
focused on worker safety and health in the workplace.

 The act granted the federal government the power to
establish and enforce occupational safety and health

standards for businesses in interstate commerce.
 OSHA is premised on the General Duty Clause that every
employer has an obligation to provide a safe working

environment.
 OSHA compliance officers conduct unannounced
workplace inspections and can issue citations and impose

fines for violations of the Act.

Emerging Areas of Discrimination Law
 Employees with disabilities
 Definition of what constitutes a disability is constantly
changing and expanding:

 an impairment that limits major life activities
 having a record of impairment
 being regarded as having a disability
 includes both physical and psychological impairments
 Reasonable accommodation
 The question of “reasonable accommodation”
 AIDS
 Considered a disability against which employers may not
discriminate in any employment-related matter

 Coworker education and accommodation of the individual

Sexual Harassment
Unwelcome sexual
advances in the work
Definition of environment occurring
Sexual with sufficient frequency
Harassment to create an abusive work
environment.
The harasser offers to

Quid Pro Quo exchange something of
Harassment value for sexual favors
from the harassed.
An employee feels
Hostile Work uncomfortable or sexually
Environment harassed by conditions in
the work environment.

Employment-at-Will
 Employment-at-will is based on the premise that
both employer and employee have the mutual right
to terminate an employment relationship at any time,
for any reason, and without advance notice.
 Wrongful discharge suits arise from employees’
beliefs that an employer did not afford them due
process or have good cause to fire them.
 In other instances, employers’ use of employment-
at-will to discharge employees is modified by
 an implied contract that promises continued employment.
 employees’ exercising their legal rights.
 an employer’s failure to deal with employees in good faith.

Ethics and Human Resource Management
Definition of A person’s beliefs about what is right

Ethics or wrong and what is good and bad
Ethics are formed from the societal

Ethics and context in which an individual exists.
the law What is legal is not always ethical.

Evaluating Legal Compliance
Step 1 Step 2 Step 3

Have Organizations Conduct external
managers should rely on legal audits of the
develop a their own legal organization’s
clear and HR staffs to human resource
understanding answer questions procedures for
of the laws and review compliance with
that govern procedures. laws and
HRM. regulations.

LAST OF CHAPTER THREE

Angelo S. DeNisi &
Ricky W. Griffin
The Global Environment
CHAPTER 4
Global Business Centers
Europe
North America
Pacific Asia

The World’s Ten Largest Multinational Firms
Home Revenues
Rank Corporation Country $ (millions) Employees
1 General Motors U.S. 161,315.0 594,000
2 DiamlerChrysler Germany 154,615.0 441,502
3 Ford Motor U.S. 144,416.0 345,175
4 Wal-Mart Stores U.S. 139,208.0 910,000
5 Mitsui Japan 109,372.9 32,961
6 Itochu Japan 108,749.1 5,775
7 Mitsubishi Japan 107,184.4 36,000
8 Exxon U.S. 100,697.0 79,000
9 General Electric U.S. 100,469.0 293,000
10 Toyota Motor Japan 99,740.1 183,879
Source: Fortune, August 2, 1999.

Copyright © Houghton Mifflin Company. All rights reserved. Reprinted by permission of Fortune Magazine. 4-71
Global Issues in International HRM
Developing an
international HRM
strategy
International
human resource
management
Developing an Developing an
understanding of the understanding of the
cultural environment political and legal
of HRM environment of HRM

International HRM Strategy
 Home Country Nationals
 Employees whose nationality is the same as that of country
in which the parent company is based.

 Host Country Nationals
 Employees whose nationality is the same as that of the
country in which the foreign affiliate is located.

 Third Country Nationals
 Employees whose nationality is neither that of the parent
company’s country nor that of the host country where the

foreign affiliate is located.

International HRM Strategy
 Ethnocentric staffing model
 Firms using this model hire home-country nationals to staff
higher-level foreign positions. HRM prepares managers for
overseas assignments, develops their compensation
packages, and handles returning-employee adjustments.
 Polycentric staffing model
 HRM practices put more host-country nationals at all levels
throughout the foreign subsidiary.
 Geocentric staffing model
 This model puts home-, host-, and third-country nationals
all in the same category. Positions in fully internationalized
firms are filled with the best-qualified persons, regardless
of their origin.

Understanding the Cultural Environment
Be e
Va lie g
a y
lu fs, u
g nc
es n
La Flue
Cultural
Differences
l s, So
bo s ci
y m om
S st Ro eta
le l
Cu s

Political and Legal Issues of International Business
Government Trade
stability incentives
Political and
legal issues
Trade Economic
controls communities

Management Challenges in International Business
Differences in culture, level

of economic development,
and legal systems
International
business
Determination of the most Working conditions,

appropriate source of compensation,
employees and cost of living

Specific HR Issues in International Business
 Exporting
 is the process of making a product in the firm’s domestic
marketplace and selling it in another country.
 Licensing
 involves one company granting its permission to another
company in a foreign country to manufacture and/or
market the first firm’s products in the local market.
 Direct investment
 occurs when a firm headquartered in one country builds or
purchases operating facilities in a foreign country
 Joint venture or strategic alliance
 refers to two or more firms cooperating in owning or
managing an operation.

Domestic Issues in International HRM
Local recruiting and

selection issues
Domestic issues
in international
HRM
Local training issues Local compensation issues

Managing International Transfers and Assignments
 Expatriates
 are employees sent to work in another country and may be
either parent-country nationals or third-country nationals.

 Commonly required skills for expatriates
 Managerial competence, adaptability to new situations,
language training, overall physical and emotional health,

independence and self-reliance, job experience and
education.
 Avoiding costly expatriate failures (early returns)
 To increase the likelihood of success in overseas postings,
firms choose expatriates carefully, pay differential

compensation (hardship premiums), and provide cross-
cultural training for expatriates and their families.

Expatriate Compensation Balance Sheet
U.S. Domestic U.S. Expatriate

Base Salary Balance Sheet
U.S. hypothetical tax and social

Taxes security
Foreign and excess U.S. taxes
paid by company
U.S. spendable income
U.S. hypothetical housing
Consumption and utility
U.S. auto purchase
Excess foreign costs
paid by the company
Savings U.S. level savings
Foreign service / hardship

premium added by company
International Labor Relations
 Labor parties
 Many other countries have labor parties that take a direct
and active role in national politics. Labor unions in many

countries are much more concerned with social issues than
are unionized groups in the U.S.
 Labor-management relations differences
 Labor “contracts” in some instances are considered
understandings that can be broken by either party.

 Strikes and work stoppages are used more to garner public
support than as a bargaining tool against employers.

 The degree of cooperation between management and labor
ranges from confrontational in Europe to cordial in Japan.

LAST OF CHAPTER FOUR

Angelo S. DeNisi &
Ricky W. Griffin
Human Resource Planning and Job Analysis
CHAPTER 5
Staffing
 The process of determining the organization’s
current and future human resource needs and then
taking steps to ensure that those needs are met.

Strategic Importance of Human Resource Planning
 Alterations in organizational strategy create the
necessity for change in organizational structure.
Structural change affects both quantitative and
qualitative characteristics of the human resource
needs in an organization.
 The fluidity of human resources in organizations

requires effective human resource planning that
takes a careful and considered approach to
workforce changes.

Job Analysis and Other HR Functions
Human Selection process

resource
planning
Performance appraisal
Job
analysis
Training and development
Basic line
management Compensation
functions

Job Analysis and Human Resource Planning
 Job Analysis
 The process of gathering and organizing detailed
information about various jobs within the organization so

that managers can better understand the processes through
which those jobs can be most effectively performed.
 Essential Functions
 are those parts of the job (tasks, duties, and responsibilities)
which have been identified as critical to successfully

accomplishing the job.
 Identifying essential job functions is crucial to avoiding
discrimination against the disabled. Disabled persons must

be considered for employment if they can carry out the
essential functions with reasonable accommodation.

Knowledge, Skills, and Abilities (KSA)
Knowledge,
Skills, and
Abilities
(KSA)
Job A
Family
Job A1 Job A2 Job A3 Job A4

Steps in Job Analysis
Determining information needs
Determining methods for obtaining information
Determining who will collect information

Determining Information Needs
 Types of information
 general work activities
 how the job relates to other jobs
 procedures used on the job
 behaviors required on the job
 physical movements and demands
 machines, tools, equipment, and work aids
 physical environment of the job
 organizational and social context of the job
 work schedule and incentive compensation
 personal requirements (i.e., skills, education,
training, experience, physical demands)

Selecting Job Analysis Methods
 Job analysts
 individuals who
perform job analysis

in organizations
 Job analysis methods
 observing tasks and
job behaviors
 interviewing job
incumbents and supervisors

 distributing questionnaires and check lists
 having the job analyst actually perform the job

Responsibilities for Job Analysis
 Parties responsible for conducting job analysis
 line managers
 human resource group or department
 job analysts
 Dictionary of Occupational Titles (DOT)

 A federal index of occupations listed by a standardized code. It
describes the people, data, and things associated with different

jobs listed.
 O*NET
 An online job information resource that provides information
on 33 knowledge areas and on the relative importance of 46

skills, 36 cross-functional skills, and other data useful as
comparison job analysis information.

Collecting Job Analysis Data
 Subject Matter Experts (SMEs)
 are individuals presumed to be highly
knowledgeable about jobs who will provide data for

job analysis; they may be job incumbents,
supervisors, or other employees.
 Job analysis information
 identifies the major job dimensions
that can then be subdivided

into specific job tasks.
 identifies the basic KSAs
necessary to perform
the job tasks.

Specific Job Analysis Techniques
 Narrative job analysis
 One or more SMEs prepare a straight written narrative or
text description of the job.

 Fleishman job analysis system
 This approach relies on a taxonomy of 52 abilities
representative of relevant work dimensions and considered

to be enduring individual attributes that account for
differences in performance. SMEs use Fleishman scales to
represent the level of ability required for a job.

 Task analysis inventory
 is a family of job analysis methods; each method focuses
on analyzing the focal job to create task inventories. Each

task is then evaluated separately on job dimensions.
 Functional job analysis
 The first approach to a single universal instrument that can
be used to describe all jobs in common terms of people,

data, and things. The degree to which these three factors
are present in the job determines the complexity of the job.

 Position analysis questionnaire
 Developed by Ernest McCormick as a standardized job
analysis instrument consisting of 194 items in six sections

that are related to job dimensions of work behaviors.
 Critical incidents approach
 relies on critical incidents of behaviors that distinguish
effective from ineffective performers. Useful in developing

appraisal instruments and focusing on effective
performance.

Job Descriptions and Job Specifications
 Job description
 lists the tasks, duties, and
responsibilities that a
particular job entails.
 Job specification
 specifies the characteristics
of the individual who will

perform the job. It lists the
knowledge, skills, abilities,
and other characteristics that are
necessary to be able to perform
the job successfully.

The Human Resource Planning Process
Forecasting the supply of human resources
Forecasting the demand for human resources
Comparing forecasted supply and forecasted demand
Taking appropriate actions

Forecasting the Supply of Human Resources
 Sources for labor supply forecast information
 an organization’s records related to the internal supply of
human resources
 external information about the supply of human resources
 Methods to forecast future labor supplies

 mathematical models that assume linearity of current trends
 input from supervisors and managers in the organization
 Executive succession
 involves systematically planning for future promotions into
top management positions.

 includes slotting replacement candidates into successor
roles before their anticipated positions open.

Forecasting the Demand for Human Resources
 Changes in corporate strategy
 create structural changes in firms and in the human
resource requirements of firms.

 Statistical approaches
 that are based heavily on trend analysis may overlook
important dynamics in the business environment.

 Unit (bottom-up) forecasting
 relies on organizational units to predict their own future
demand for employees.

 Top-down forecasting
 is the use of top managers and top executives to develop a
forecast of human resource demand.

Labor-related Forecasting Ratios
Productivity Ratio The average number of units produced per

direct labor employee per year.
Staffing Ratio Used to calculate the number of

individuals required in jobs not directly
involved in the production of actual
products.
Learning Curve An elaboration of basic forecasting

methods that takes into account increases
in productivity related to gains in
experience and learning.
Multiple Regression A complex mathematical procedure

forecasting technique that relies on
multiple correlation indices that are
interrelated to predict HR demand.

Human Resource Information System
Name: Cedric Cool DOB: 11/1/64

Job: Entertainer Hired: 05/1/94
Education: Charming College
Performance: Appropriately slick
Annual pay: $28,500 - $34,000
KSA: Beer Commercials

Outcomes of Human Resource Planning
Comparison of demand and supply
Demand higher Supply larger Demand equal to

than supply than demand supply
Plan for
Plan for growth workforce Plan for stability
reduction

LAST OF CHAPTER FIVE

Angelo S. DeNisi &
Ricky W. Griffin
Recruiting Human Resources
CHAPTER 6
Organizational and Individual Goals in Recruiting
•Attract a pool of qualified applicants

Organizational •
Keep pool at manageable size
Goals
•Provide realistic job previews
? ?
•Meet work-related goals
Individual •Meet personal goals
Goals
•Address personal needs

Internal and External Recruiting
Advantages Disadvantages
Internal recruiting  Increases motivation  May foster stagnation
 Sustains knowledge  May cause ripple effect
and culture
External recruiting  Brings in new ideas  May hurt motivation

 Avoids ripple effect  Costs more

Methods of Recruiting
Internal Recruiting
 Job posting
 Vacancies posted via bulletin board, memo, and intranets.
 Supervisory recommendations
 Supervisors forward their recommendations for their
employees to higher managers.

 Union halls
 Union members are able to apply for open positions on a
priority basis through the union hiring hall process.

 Recall from layoffs

Methods of Recruiting
External Recruiting
 General labor pool
 The local labor market for potential employees.
 Referrals
 Individuals who are prompted to apply by a member of the
organization.
 Direct applicants (walk-ins and drop-ins)
 Individuals who apply (without any proactive action from the
organization) whether or not an opening actually exists at the

time of application.

Techniques for External Recruiting
State
World-Wide Employment
Service
Headhunters, Inc.
(Internet-based
applications only)
Advertisements
Word of Mouth
ProTemps
l l e C ollege e
Be t Offi
c
e m e n
Plac

Realistic Job Previews
 A technique to ensure that
job seekers understand the
actual nature of the jobs
available to them.
 As a result, some candidates
will withdraw from
consideration while others
will choose to join.
 Those who remain are
generally more successful;

satisfied with both their job
choice and the organization.

The Prospective Employee’s Perspective
Now Hiring
ABC Inc.
The People Company
Through its recruiters and Prospective employees

recruiting materials, the use information gained in
organization signals its the recruiting process to
basic values and concerns assess their “fit in” with
to prospective employees. the organization.

Alternatives to Recruiting
Ov y ee
ert pl o ng
im
e Em easi
L
Help
Wanted
y Pa
ar rt-
por Wo Tim
e m er s rk e
T rk ers
o
W

Evaluating the Recruiting Process
a reasonable pool of available and

The qualified potential employees.
recruiting a recruitment process that can be
process is executed with relatively low cost.
effective if it the best yields of qualified
results in applicants with the desired skills
from each of its targeted sources.

LAST OF CHAPTER SIX

Angelo S. DeNisi &
Ricky W. Griffin
Selecting and Placing Human Resources
CHAPTER 7
Steps in the Selection Process
The recruiting process
Gather information about pool of qualified

applicants
Evaluate qualifications of each applicant
Make decisions about employment offers

Responsibilities for Selection
 Hiring new employees in the organization is the
jointly shared responsibility of human resource
managers and operating (line) managers.
 Human resource departments design and manage
the selection system and gather basic selection data
on applicants.
 Operating managers interview applicants and make
decisions about their “fit” in the organization.
 Coworkers and team members may
interview and make their
recommendations about
applicants.
Hire?

A Sample Selection System
Applications and background checks Unqualified
Qualified
Employment tests Perform poorly

Perform well
Interviews Poor impression

Good impression
References and recommendations Negative feedback

Positive feedback
Physical examination Poor impression
Selection decision /job offer

Basic Selection Criteria
 Education
 refers to the formal classroom training in an academic
setting. Education may be general or specific. Degrees and

certifications are assumed to be indicators of training and
educational level.
 Competencies
 are relatively broad capabilities that are necessary for
effective job performance. Competency goes beyond

education and deals with whether or not a person can
actually do something.

 Experience
 is the amount of time the individual may have spent
working, in either a general capacity or a specific field.

 Skills and abilities
 relate to the specific qualifications and capabilities of an
individual to successfully perform a job.

 Personal characteristics
 reflect an individual’s personality and can be important to
success on the job.

 The “big five” five personality (behavioral) traits are
 neuroticism, extraversion, openness to experience,

agreeableness, and conscientiousness.
 The issue of hiring for “fit” versus skills
 Beliefs differ among HR managers about whether they
should hire persons with the best job-specific skills rather

than those who best “fit” into the organization.

Popular Selection Techniques
 Employment applications
 ask for personal information having a bearing on the
applicant’s suitability for the job:

 name, educational background, career goals, and experience.
 cannot ask non job-related questions such as
 gender, age, or marital status.
 Weighted application blanks
 Various personal characteristics can be assigned numerical
indices reflecting specific levels of factors (e.g., education and

experience) related to performing a job effectively.
 Biodata applications
 Personal background information is used to assess applicants
and predict their future performance.

Employment Tests
Cognitive Measures of cognitive (mental) abilities such as

ability tests general intelligence (g) expressed as IQ scores.
Psychomotor Measures of physical abilities such as strength,

ability tests eye-hand coordination, and manual dexterity.
Personality Measures of personal traits, or tendencies to act,

tests which are relatively stable personal characteristics.
Self-report Measures of applicant’s responses to statements

inventories that may or may not apply to that person.
Projective Measures applicant’s subjective response to an

technique ambiguous stimulus (inkblot).
Integrity Attempt to assess an applicant’s moral character

tests and honesty.

Work Simulations
 Work simulations
 (sometimes referred to as work samples) ask the
prospective employee to perform tasks or job-related

activities that simulate or represent a sampling of the work
for which the person is being considered.
 In baskets
 are special forms of work
simulations for prospective

managers and consist of
collections of hypothetical
memos, letters, and notes
In
that require responses.

Personal Interviews
 Structured interview
 A standardized list of job-related questions asked of all
applicants is used for consistency in gathering information

about the applicant. Answer scoring is based on how well an
applicant’s responses match a predefined key.
 Semistructured interview
 An initial set of major or key questions requiring applicant
responses is used; follow-up questions are used to expand on

specific applicant answers to the primary questions.
 Unstructured Interview
 The interview is spontaneous and wide-ranging with no set of
prepared questions. Less valid than a structured interview in

predicting subsequent job performance.

Personal Interviews
Common interviewer errors

 First- impression error
 Contrast error
 Similarity error
 Nonrelevancy error
 Job-knowledge error
Errors can be eliminated or

reduced through proper training
of interviewers to make them more
aware of personal behaviors and biases
that influence their assessments of applicants.

References and Recommendations
 Problems
 Lack of credibility in self-selected
reference sources.
 Legal liability associated with negative
recommendations or assumption
of liability by the provider for
providing an incorrect reference.
 Reluctance of organizations to provide subjective or
assessment information on former employees. Verification

of information is restricted to objective factors (i.e., dates
of employment, salary history, and job title).

Physical Examinations
 Examinations are used to  Drug testing
determine if the applicant  can be required as a condition
 is physically healthy enough to of employment.
perform the job.  must be conducted under
 has any serious communicable rigorously controlled
diseases. conditions and the results
 has the stamina and physical must be true and verifiable.
conditioning to perform a
hazardous or strenuous job.
 Americans with Disabilities Act
 The Act prohibits discrimination
against applicants on the basis of

physical disabilities.
 Examinations now typically
occur after job offers are made.

Special Selection Methods for Managers
 Assessment centers
 An approach to selecting managers
that focuses on measuring and

evaluating critical work behaviors.
Typically used to assess managers
under review for promotions to
higher organizational levels.
 Networks and contacts
 Informal contacts and interpersonal
relationships that yield information

not available through other means.
Caution should be taken to avoid
biased and discriminatory actions.

Selection Technique Reliability
 Reliability
 refers to the consistency of a selection device in measuring
what it purports to measure, without random error.

 Assessing reliability
 Test-retest reliability (correlating a selection technique’s
results at two points in time) establishes the strength of the

technique’s reliability over time.
 Alternative-form reliability uses multiple forms of the
same instrument that are administered to various

individuals. To the extent to which the scores on alternative
forms are consistent, reliability across various forms can be
inferred.

Selection Technique Validity
 Validity
 refers to the extent to which a measure or an indicator is a
reliable and real reflection of what is assumed to be.

 Content validity
 is the extent to which the selection technique measures
KSAs necessary to perform the job.

 Construct validity
 is the extent to which a relationship exists between the test
scores and an underlying trait (e.g., honesty testing).

 Criterion-related validity
 is the extent to which a selection technique (predictor) can
accurately predict an element of performance (criterion).

Single- versus Multiple-Predictor Approaches
 Advantages of multiple-
predictor approaches
 Validity and reliability of the
overall selection process is

enhanced.
 Measurement error in a
single predictor is
counterbalanced by other
selection techniques.
 A wider variety and greater
depth of information about

each applicant is available.

The Selection Decision
 Banding
 involves creating clusters of job applicants who do not differ
substantially from one another. Banding allows the

organization to select an applicant from an underrepresented
group in the organization without compromising high
performance standards.
 Job Offer and Negotiation
 Offer of employment may be immediate, firm, or subject to
negotiation, depending on the applicant’s desirability and

level-of-hire in the organization.
 Determining Initial Job Assignments
 Placements of newly hired personnel should consider the
needs of both the firm and the new employees.

LAST OF CHAPTER SEVEN

Angelo S. DeNisi &
Ricky W. Griffin
Performance Management
CHAPTER 8
Performance Appraisal
Performance appraisal
 is the specific and formal
evaluation of an employee in
order to determine the degree
to which the employee
is performing his or
her job effectively.
Performance
management
 is the general set of activities carried
out
by the organization
to change (improve) employee
performance.

Why Organizations Conduct Performance Appraisals
Importance and goals of performance appraisal
Provides a benchmark for recruiting and selection processes
Identifies training needs and verifies training effectiveness
Provides guidance in structuring compensation and rewards
Documents the merit basis of organization’s selection process
Gives feedback for motivating and developing employees
Provides information for use in human resource planning

A Typical Performance Management Process
Establish
Is Performance
job duties
Improving?
Yes
Establish and communicate Additional Recognize/reward

performance standards feedback, performance,
coaching or
No foster further
Inspect/observe counseling development
may be Implement
performance
utilized performance
Performance
improvement
Document/record managed
plans
observed performance (repeat
performance
cycle)
Rate
performance Has Yes
Performance
Set up meeting Improved?
with employee No
Provide feedback, coaching
Transfer/demote/terminate employee
or counseling as needed
Sources of Information for Performance Appraisal
Supervisor Peers
Self-appraisal The Ratee Customers
Subordinates

Roles in the Performance Appraisal Process
The organization’s role is to develop the general appraisal process

and define its purposes (development and compensation),
frequency, performance standards, and the use of appraisal results.
The role of raters in the appraisal process is to assist in the

development of performance standards, collect information,
communicate the appraisal results, and engage in performance
management.
Ratees must have access to performance appraisal information in

order to develop clear and unbiased views of their work
performance and be receptive to changing their behaviors.

3600 Performance Appraisal
Supervisor
Team
Peers
Self
Customers
Subordinates
Ranking Methods
Simple The manager ranks from top to bottom or best to

ranking worst each member of a particular work group.
Paired- The manager compares each employee with every

comparison other employee, one at a time.
Forced- The manager groups employees into predefined

distribution frequencies of performance ratings.

Rating Methods
Graphic The manager selects a point on a scale that
rating scale consists of a statement or question about
some aspect of an individual’s performance.
Critical- Managers are required to recall, or consult a

incident log of, instances of good or bad employee
performance when evaluating performance
and giving feedback.
Behaviorally BARS are a combination of graphic rating

Anchored scales and the critical-incident method that
define various dimensions of performance.
Rating The scales place work behaviors in a
Scales hierarchy of importance.

Rating Methods
Behavioral A BOS is developed from critical incidents,
Observation like BARS, but uses more critical incidents to
define effective performance measures and to
Scale indicate their frequency of occurrence.
Management A goal-based appraisal system that focuses

by on collective goal setting by subordinates and
their managers. Goals are periodically
Objectives reviewed for progress and attainment.

Examples of Graphic Rating Scales
Please rate the target subordinate on the following characteristics:
Attitude
1 2 3 4 5
Poor Below Average Above Outstanding
Average Average
Working with Others

1 2 3 4 5 6 7
Poor Average Outstanding
Meeting Deadlines
____ Needs improvement
____ Meets expectations
____ Exceeds expectations
Quality of Work
Poor Outstanding

Deficiencies and Weaknesses of Performance Appraisals
Projection The tendency to see in others characteristics
that we have, which we think contribute to
effectiveness.
Contrast An error that occurs when comparing people

error against one another rather than to an objective
standard.
Distribu- An errors of severity, leniency, or central

tional error tendency made when a rater uses only one part
of the scale.
Halo One positive performance characteristic causes

error the manager to rate all performance aspects
positively.
Horns A manager downgrades all performance

error because of a single negatively viewed
performance dimension.
Behaviorally Anchored Rating Scales
Performance Dimension 1.
Interpersonal skills: Instructor’s ability to establish
rapport with students in and out of the classroom.
7
Instructor encourages students to ask questions.
6
Instructor comes down to level of students.
Instructor maintains an informal relationship with the students
5
4
Instructor doesn’t draw out students who don’t ask questions.
3
2
Instructor “puts down” students who ask questions.
Instructor lowers students’ self-esteem.
1

Management by Objectives (MBO)
Supervisor Subordinate
Collectively set goals
Goals review Periodic review Feedback
Annual review

Performance Management and Providing Feedback
Improving the performance feedback interview
Provide timely and ongoing feedback to employees.
Have individuals appraise their own performance.
Encourage participation and two-way communication.
Balance negative and postive feedback during the interview.
Maintain a developmental and problem-solving orientation.
Set clear and specific goals for improving performance.

LAST OF CHAPTER EIGHT

Angelo S. DeNisi &
Ricky W. Griffin
Training, Development, and Organizational Learning
CHAPTER 9
The Nature of Training and Development
 Employee training  Development
 is a planned attempt by an  refers to teaching managers
organization to facilitate and professionals the skills

employee learning of job- needed for both present and
related knowledge, skills, future jobs.
and behaviors.  helps managers better
 is intended to help the understand and solve
organization function more problems, make decisions,
efficiently. motivate employees, and
 is aimed at improving capitalize on opportunities.
employee productivity.
New Stuff
 is used to accommodate
changes in the workplace.

Learning Theory and Employee Training
 Learning
 is a relatively permanent change in behavior or behavioral
potential that results from direct or indirect experience.

 A learning organization
 is one whose employees continuously attempt to learn new
things and to use what they learn to improve product or

service quality.
 The bottom line
 All managers should understand the basic purposes and
processes of both training and development. Moreover,

managers should also recognize the role of learning theory in
training and development and be familiar with how the
aspects of learning relate to training and development.

Learning and Employee Training and Development
Motivation
to learn
Learning reinforced
by the organization
Practice
Training and activity
Meaningful
and
development learning
Behaviors seen
as meaningful
Content effectively
communicated
Content transferable
to job setting
Goals of Orientation
Reduce anxiety and Help new employees get

uncertainty for new acquainted and integrated
employees into their work group
Orientation
Program
Provide favorable initial

job experiences for new
employees

Basic Issues in Orientation
Issues to consider when planning an orientation
The content of the orientation program:

• basic understandings of organizational policies and procedures
• hours of work, compensation, and vacation schedules
• general overview and introduction to the business
• work rules, disciplinary and grievance procedures
The length of the orientation period:

• the more material included, the longer the orientation period
• whether to use a single orientation period or an initial period
with a follow-up session at a later date
The choice of who will conduct the orientation:

• HR managers, operating mangers, and operating employees
• union officials and retired employees

Sample New Employee Orientation Schedule
ΞΞ PACIFIC LABORATORIES
A LIFE-LABS
COMPANY
9:00 Welcome and overview of the day (with refreshments)

9:30 Introduction to the company
10:00 Overview of the employment relationship
 wage and salary policies  performance appraisal policies
 work schedules  discipline procedures
 parking  grievance procedures
 training opportunities
11:00 Overview of benefit options
12:00 Lunch
1:00 Benefit enrollment
2:00 Tour of the workplace
3:00 Introduction of supervisor and coworkers

Assessing Training and Development Needs
Needs analysis
•Organization’s job-related needs
•Capabilities of the existing
workforce
Setting training and

development goals
Determining approach
•In-house programs
•Outsourced programs

Developing a Training Program Outline
Objectives
of
Training
Training Program
Intended
Audience
Outline
Proposed
Content of
Training
Time
Estimates
for
Training
In-House
or
Outsource Training
Cost
Estimates

Selecting Training and Development Instructors
In-house experts don’t always make

good instructors
Effective instructors facilitate learning
Professional trainers may lack
expertise
Ineffective instructors create learning barriers

Gagne’s Learning Categories
1. Intellectual skills include concepts, rules, and

procedures and are often referred to as procedural
knowledge.
2. Verbal information enables the individual to state
something about a subject and is also referred to as
declarative information.
3. Cognitive strategies enable a learner to know when and
how to use intellectual skills and verbal information.
4. Motor skills include basic human physical activities such
as writing, lifting, and using tools.
5. Attitudes are learned preferences for different activities.
Source: Robert M. Gagne, “Learning Outcomes and

Their Effects: Useful Categories of Human Performance,”
Copyright © Houghton Mifflin Company. All rights reserved. American Psychologist,
Psychologist, Vol. 39, 1984, pp. 377-385. 9-163
Training and Development Techniques and Methods
 Work-Based Programs
 On-the-job training
 Apprenticeship
 Vestibule training
 Systematic job rotations
and transfers
 Instructional-Based Programs
 Lecture or discussion approach
 Computer-assisted instruction
 Programmed instruction

Training Technology
New technologies
 Video teleconferencing
 Interactive video
Team-building and Group-based Methods

 Outdoor training exercises
 Cooking classes

Special Techniques for Management Development
 In basket exercise
 Individuals are confronted with a hypothetical in basket of
letters, memos, reports, and notes. Feedback is given on

how to improve trainee’s time management and
prioritization skills
 Leaderless group exercise

 Trainees are put in a group setting and told to make a
decision or to solve a problem. The group must appoint a

leader who then takes action to help the group accomplish
its goal.

Organization Development (OD)
 Organization development
 is the planned systemwide effort that is managed from the
top of the organization to increase the organization’s

overall performance through interventions that rely
heavily on behavioral science technology.
 OD assumes that employees desire to grow and to
develop, and have a strong need to be accepted by others

in the organization.
 OD is used to foster collaboration between managers and
employees to take advantage of the skills and abilities of

employees and to eliminate aspects of the organization
that limit employee growth, development, and group
acceptance.

Organization Development (OD) Techniques
Survey Third-party
feedback peacemaking
Diagnostic
activities Process
consultation

Evaluating Training and Development
Trainee evaluations of
Pre-test and post-test of
training/development
trainee performance
program
Sources of
evaluation
information
Measurements of change
in organizational
performance

LAST OF CHAPTER NINE

Angelo S. DeNisi &
Ricky W. Griffin
Basic Compensation
CHAPTER 11
Compensation
 Compensation
 is the set of rewards that organizations provide to
individuals in return for their willingness to perform

various jobs and tasks within the organization.
 Internal equity
 in compensation refers to comparisons that employees
make to other employees within the same organization.

 External equity
 in compensation refers to comparisons employees make to
others performing similar jobs in different organizations.

Basic Purposes of Compensation
Internal External
equity equity
Expense Compensatio Legal

control n compliance
Reward and
motivate

Wages versus Salaries
 Wages
 generally refer to hourly compensation paid to
operating employees; the basis for wages is time.
 Salary
 is income that is paid an individual not on the
basis of time, but on the basis of performance.

Strategic Options for Compensation
Anticipation of
setting pay level
Determination
of market pay
Pay below Pay market Pay above

market rate rate market rate

Organizational Pay Rates
Disadvantages Advantages
• Additional compensation • Attracts better employees
Pay
costs • Minimizes voluntary
• Sense of entitlement above turnover
market • Fosters strong culture and
rate competitive superiority
• Does not attract higher • Higher quality of human

Pay at resources at midrange of
performers
• Turnover will vary with labor market market-driven compensation
demands of competing firms rate costs
• Lower-quality employees Pay • Lower compensation costs

• Low morale/job satisfaction below • Useful in labor markets
• Higher turnover; especially market where unemployment is
among high performers rate high

Determinants of Compensation Strategy
Factors contributing to a firm’s compensation strategy
Relationship of overall strategy to compensation strategy
Growth rate of firm and demand for human resources
Financial condition of the firm (i.e., ability to pay)
Overall attractiveness of firm (i.e., location, culture)
Legal context of federal, state, and local labor regulations
Union influence and presence in labor market

Pay Surveys and Compensation
 Pay surveys
 are surveys of compensation paid to employees by other
employers in a particular geographic area, an industry,

or an occupational group.
 assist firms in avoiding problems of external equity
when attempting to set compensation strategy for

themselves.

Determining a Wage and Salary Structure
Job ranking Classification

method system
Regression- Job
based system Point system
Evaluation
Factor
comparison
method

Job Evaluation and Job Worth
Job Ranking
Job A B C D Total
A 0
B 1 1 2
C 1 1 1 3
D 1 1
Point System
Compensable Degree Degree Degree Degree Degree Total
Factors 1 2 3 4 5 Points
Knowledge 10 20 30 40 50 150
Experience 15 30 45 60 75 225
Job responsibilities 25 50 75 100 125 375
Working conditions 5 10 15 20 25 75

Job Evaluation and Job Worth
 Factor comparison method

 assesses jobs on a factor-by-factor basis, using a factor
comparison scale as a benchmark.

 Regression-based system
 uses a statistical technique called multiple regression to
develop an equation that establishes the relationship

between different dimensions of the job and compensation.

Factor Comparison Method of Job Evaluation
 Six steps:
 Comparison factors are selected and defined.
 Benchmark or key jobs are identified.
 Benchmark jobs are ranked on each compensation factor.
 A part of each benchmark job’s wage rate is allocated to
each job factor.

 Two sets of ratings are prepared, based on the ranking and
the assigned wages, to determine the consistency

demonstrated by the evaluators.
 A job comparison chart is developed to display the
benchmark jobs and the monetary values that each job

receives for each factor.

A Sample Wage Structure
Maximum
Maximum Midpoint
Salary (in dollars)
Maximum Midpoint
Minimum
Maximum Midpoint
Minimum
Midpoint
Maximum
Minimum
Midpoint
Minimum
Minimum
| | | |
Grade (class): 1 2 3 4 5
Containing jobs: ABC DEF GHI JKLM NOP

Wage and Salary Administration
 Managing compensation
 allows the organization to control compensation costs and
to maintain a compensation structure that fits the needs of

both the organization and its employees. As organizational
circumstances change, it may become necessary to modify
or change the compensation strategy.
 Determining individual wages

 has its basis in the organization’s awarding differential
compensation to employees on the basis of qualifications,

seniority, or other job-related factors.

Wage and Salary Administration
 Pay secrecy
 refers to the extent to which an individual’s compensation
in an organization is secret.
 Arguments for pay secrecy
 An individual’s compensation is a private matter and not for

public knowledge.
 Knowing pay levels fosters jealousy and resentment.
 Argument against pay secrecy
 Public knowledge about an open-pay system creates proper
perceptions of equity and motivates performance.
 Pay compression
 occurs when individuals of substantially different levels of
experience or seniority are paid similar wages or salaries.

Angelo S. DeNisi &
Ricky W. Griffin
Incentives and Performance-Based Rewards
CHAPTER 12
Rewards and Motivation in Organizations
Perception that
motivated behavior
Personal needs Motivated effort
will result in rewards
and goals and behavior
aligned with needs
and goals

Expectancy Theory
Environment
Motivation Effort Performance Outcome
Ability

Reinforcement Theory
Positive consequence
(reinforced by reward)
Repeated
Behavior
Not repeated
Negative consequence
(no reward)

Agency Theory
Owners Agents
Minimize costs as a Spend resources

way of maximizing Compensation (incur costs) to
personal wealth operate business
Accept more risk to Take fewer risks to

maximize wealth Risk guarantee success
(return) (income)
Focus on longer time Easier to maximize

frame for Time horizon performance in the
performance short term
Agency theory is concerned with the diverse interests and goals held by
the organization’s stakeholders, including its employees and managers,
and the methods through which the organization’s reward system can be
used to align these diverse interests and goals.

Rewards, Motivation, and Performance in Organizations
Ability
Motivated effort
Performance
and behavior
Environmental
context

Rewards and Other Employee Behaviors
Turnover Absenteeism
Rewards
Attendance

Merit Compensation Systems
 Merit pay
 is awarded to employees on the basis of the relative value
of their contributions to the organization.

 Merit pay plans
 are compensation plans that formally base at least some
meaningful portion of compensation on merit.

 Limitations of merit compensation systems
 Focus on individual performance, which may be affected
by factors outside the control of the individual.

 Rely on potentially erroneous appraisal systems.
 Based on a period of performance that is too lengthy.
 Result in permanent increase to base pay.

Incentive Compensation Systems
 Piece-rate incentive plans
 involve the organization
paying an employee a
certain amount of money
for every unit she or he
produces
50¢ pay per piece produced

x 15 pieces per hour (standard)
$7.50 hourly wage

Incentive Pay Plans
 Individual incentive plans
 reward individual
performance on a real-time
basis for meeting a goal or
hitting a target.
 Sales commission plans
 reward individuals engaged
in sales work. Incentive pay

is typically a percentage of
the total volume of sales.
$100,000 sales for period
x 15% commission rate
$15,000 commission pay

Team and Group Pay Systems
 Gainsharing
 is a team- and group-based incentive system designed to
share with employees the cost savings from productivity

improvements. Gainsharing begins with a clear and
measurable standard for team- or group-level productivity.
The gains from cost savings or productivity improvements
are allocated between the organization and the employees.
 The Scanlon plan
 is a type of gainsharing plan in which the distribution of
rewards for cost savings gains is tilted toward employees

and spread across the entire organization. The Scanlon plan
focuses on improvements in productivity (cost reductions)
and not on profitability.

Other Types of Team and Group Rewards
 Group and team incentives
 are paid as they are earned, rather than being added to
employees’ base salaries.

 Profit sharing
 is an incentive system in which, at the end of the year, some
portion of the company’s profits is paid into a profit-sharing

pool, which is then distributed to all employees.
 Employee stock ownership plan (ESOP)
 is a group-level reward system in which the employees are
gradually given a major stake in ownership of a corporation.

The company uses a loan to purchase a block of its own stock
to be held in trust for the employees and then repays the loan
from its profits.

Executive Compensation
Bonus Stock options
Base
salary Perquisites
Chief Executive Officer

Angelo S. DeNisi &
Ricky W. Griffin
Employee Benefits and Services
CHAPTER 13
Typical Employee Compensation
Work wages
$32,000
68%
Benefits
$15,000
32%

Differences in Social Contracts
United
Germany States
Workweek (hours) 37.6 40
Days off 42 23
Yearly hours worked 1,499 1,847
Mandated benefits 30% 10%
(% of wages)
Efficiency wage theory:

Firms can save money and become
more productive because their higher
compensation attracts better employees.

Indirect Compensation and Employee Benefits
Improve
satisfaction/
decrease turnover
Indirect
Meet employee compensation Respond to
expectations and employee external forces
benefits
Attract better
employees

Types of Employee Benefits
Benefits refer to rewards, incentives, and other things of value

that an organization provides its employees beyond their wages,
salaries, and other forms of direct financial compensation.
Mandated by Law Optional
Social Security Health Care
Unemployment Insurance Time Not Worked Pay
Workers’ Compensation Life & LT Care Insurance
Unpaid Leave (FMLA) Retirements & Pensions

Legal Considerations
Tax Reform Act Created Roth IRA, increased
1997 deductible for self-employed health
insurance premiums; relaxed home
office deduction rules.
Tax Reform Act Limited contributions to tax-exempt

1986 and Revenue pensions; stipulated that top
executive pay over $1 million a year
Reconciliation Act cannot be tax exempt.
1993
Family and Medical FMLA requires organizations with 50

Leave Act 1993 or more employees to grant up to 12
weeks of unpaid leave for childbirth
and health-related problems.

Legal Considerations
Economic Allowed tax-deductible employee

Recovery Tax Act contributions ($2,000 limit) to
individual retirement accounts (IRAs);
1981 eased company requirements on
ESOP financing.
Pregnancy Protects women from discrimination

Discrimination Act due to pregnancy (i.e., firing).
1978
Employee ERISA set rules for employee vesting,

Retirement Income pension portability, and requirements
for qualified retirement plans to
Security Act 1974 ensure funds for retirees.

Unemployment Insurance
Intent: Provide basic subsistence payment

to employees who are between jobs
Act covers employees
who have worked a minimum number of weeks
who are involuntarily unemployed (e.g., laid off)
who must be willing to accept a suitable position

Social Security Insurance (1935)
Intent: Provide limited supplemental

income to retired individuals
Coverage and eligibility
Survivors’ insurance for underage children
Provides long-term disability and related Medicare

benefits
Must be at least 62 and have worked forty quarters
Benefits paid are determined by individual’s lifetime

average monthly earnings

Workers’ Compensation Insurance
Intent: Provide compensation to employees who

suffer a job-related illness or accident
Covers Employers Covers Employees
Assumed Employment Risk Cost of Injury
Negligent Co-Workers Temporary, Permanent,

Partial, or Total Disability
Contributory Negligence
Survivors’ Insurance

Optional Protection Plans
 Insurance coverage
 Health insurance is provided
through group plans.

 Health maintenance organizations
(HMOs) are medical organizations

that provide medical and health
services on a prepaid basis.
 Private Pension Plans

 Defined benefit plans provide a
predetermined level of benefit

based on a formula.
 Defined contribution plan
benefits depend on how much

money was contributed to the
plan and its growth.

Paid Time Off
Paid vacations Sick leave
Paid holidays
Personal leave

Minimum Annual Vacation in Different Countries
Country Minimum Vacation Required by Law

Belgium 4 weeks
Denmark 36 days
France 36 days
Greece 4 weeks
Ireland 3 weeks
Italy National Collective Bargaining Agreement
The Netherlands 4 weeks
Portugal 21-30 days
Source: Reprinted from G. Milkovich and J. Newman, Compensation, 5th ed. (Chicago:
Richard D. Irwin, 1996). Copyright © 1996 by The McGraw-Hill Companies. Reprinted
Copyright © Houghton Mifflin Company. All rights reserved. with the permission of The McGraw-Hill Companies. 13-211
Life Cycle-Based Benefits
 Life cycle benefits
 are based on a person’s stage of life and include childcare
and elder-care benefits.

 Childcare benefits
 are becoming increasingly popular. “Family-friendly”
organizations offer this benefit plan in the form of referrals,

reimbursement, or company-paid or on-site childcare.
 Elder care benefits
 are provided in the form of referral to approved facilities
and the availability of long-term health-care insurance to

provide for nursing homes or at-home care.

Other Types of Benefits
 Wellness programs
 are special benefits programs that concentrate on keeping employees from
becoming sick, rather than simply paying expenses when they become sick.
 Employee assistance plans (or EAPs)
 assist employees who have chronic problems with alcohol or drugs or serious
domestic or personal problems.

 Perquisites
 “Perks” are extra benefits that may have no direct financial value but are
considered important rewards by employees.

Trends in New Benefit Offerings
Percentage of 509 Companies Surveyed That Offer the Following Benefits to Employees:
60
50
40
Percent
30
20
10
0
*
Alternative work Long-term care Group financial Prepaid legal Group auto Group
arrangements insurance planning services insurance homeowners
insurance
1994 1997 2000 (projected)
* Not Applicable
Source: “What about benefits?” Time, November 9,
Copyright © Houghton Mifflin Company. All rights reserved. 1998. © Time Inc. Reprinted by permission. 13-214
Cafeteria-Style Benefit Plans
 Cafeteria-style benefit plans
 allow employees to choose the benefits they really want.
 maximize the effectiveness of the benefit program for the
organization and the employees.

 can lead to increased satisfaction and reduced turnover.
 can be used to encourage employees to chose more cost-
effective benefits (e.g., HMO versus traditional medical plans).

 can entail significant administrative costs.
 mean that costs of some benefits cannot be amortized across
less-intense users (adverse selection).

 must be monitored to ensure that employees make rational
choices about benefits.

Employee Awareness of Their Benefits
Percentage of Employees Reporting Accurate Knowledge of Benefits Available to All
100
80
Percent
60
40
20
0
y
y
t
n
n
ys
e
P
ce
e
e
t
en
lit
li t
en
io
nc
tio
nc
EA
av
da
an
bi
m
bi
at
em
ra
ca
ra
le
sa
sa
oy
ur
ns
al
su
su
ck
va
ir
di
on
di
ns
pl
pe
et
in
in
Si
id
m
rm
li
m
rs
R
m
al
fe
Pa
ne
ta
er
Pe
co
-te
ic
Li
en
U
t-t
ed
ng
s'
or
er
M
Lo
Sh
k
Manufacturing firm, n = 357 Insurance firm, n = 125
or
W
Source: Andrew Muonio, “How Aware Are Employees of Their Benefits?” HRMagazine, May
Copyright © Houghton Mifflin Company. All rights reserved. 1997, p. 53; Danehower and Lust, Benefits Quarterly, Fourth Quarter 1996. 13-216
Angelo S. DeNisi &
Ricky W. Griffin
Managing Labor Relations
CHAPTER 14
The Role of Labor Relations in Organizations
 Labor relations
 is the process of dealing with employees who are represented
by a union.
 A labor union
Vote Unfair
 is a legally constituted group of Strike
individuals working together to
achieve shared job-related goals,
including higher pay and shorter
working hours.
 Collective bargaining
 is the process by which managers and union leaders negotiate
acceptable terms and conditions of employment for workers

represented by unions.

A Historical Time Line of Unionization in the U.S.
United Auto Workers (1935) International

Longshoreman’s
National Federation of Federal Employees (1917) Union (1937)
American Federation of Labor (1886) Congress of

Industrial
National Education Association (1857) Organizations
(1938)
Many small
craft unions United Cigarmakers (1856) AFL-CIO
(1955)
National Trades
Union (1834)
1750 1775 1800 1825 1850 1875 1900 1925 1950
International Brotherhood
National Typographical Union (1852) of Teamsters (1903)
Iron Molders (1859)
International Ladies Garment
Knights of Labor (1869) Workers Union (1900)
United Mine Workers (1890)
Source: Ricky Griffin and Ronald Ebert, Business, 3rd ed.. © 2000.
Copyright © Houghton Mifflin Company. All rights reserved. Reprinted by permission of Prentice-Hall, Inc., Upper Saddle River, N.J. 14-219
Legal Context of Unions
Cordwainer Doctrine Local Philadelphia courts declared

cordwainers an illegal conspiracy in
restraint of trade and subject to injunction.
Commonwealth v. Massachusetts Supreme Court ruled that

Hunt 1843 unions were not a restraint of trade, but it
offered no protection for union organizers
from firing.
Sherman Antitrust Act Businesses returned to using injunctions

1890 against unions for restraint of trade.
National Labor Established rights of workers to organize

Relations Act unions and to concerted actions (e.g.,
(Wagner Act) 1935 strike); required employers to recognize
and to collectively bargain with unions and
refrain from unfair labor practices. Set up
the National Labor Relations Board (NLRB)
to administer labor law (oversee union
elections and collective bargaining).

Legal Context of Unions
Labor Management Passed in response to public outcry over

Relations Act (Taft- strikes after WWII. Curtailed and limited
Hartley) 1947 union power. Outlawed closed shops, and
gave states the option to restrict union
security clauses (right-to-work). Empowered
the U.S. president to invoke a 60-day
“cooling off” period in labor disputes that
threaten nation interests.
Landrum-Griffin Act Focused on eliminating various unethical,

(Labor Management illegal, and undemocratic union practices.
Reporting and Union officials must stand for election, and
Disclosure Act) 1959 no felons may hold national office.

The Basic Structure of a Union
National or
international union
Local Local Local Local Local

union union union union union
Shop Shop Shop Shop Shop

steward steward steward steward steward
Source: Ricky Griffin and Ronald Ebert, Business, 3rd ed.. ©

Copyright © Houghton Mifflin Company. All rights reserved. 2000. Reprinted by permission of Prentice-Hall, Inc. 14-222
Trends in Union Membership
Union or Association Members as Percent

of Wage and Salary Employment (percent)
25
20
15
Percent
10
0
1983 1989 1995
Source: Wall Street Journal Almanac 1999, p. 248. Reprinted by
permission of Dow Jones, Inc. via Copyright Clearance Center, Inc. © 1999
Copyright © Houghton Mifflin Company. All rights reserved. Dow Jones and Company, Inc. All Rights Reserved. 14-223
Union or Association
Union or Employee Members as Percent of
Association Members Wage and Salary
Year (thousands) Employment (percent)
1983 17,717 20.1
1984 17,340 18.8
1985 16,996 18.0
1986 16,975 17.5
1987 16,913 17.0
1988 17,002 16.8
1989 16,960 16.4
1990 16,740 16.1
1991 16,568 16.1
1992 16,390 15.8
1993 16,598 15.8
1994 16,748 15.5
1995 16,360 14.9
1996 16,269 14.5
1997 16,110 14.1
Source: Wall Street Journal Almanac 1999, p. 248. Reprinted by

permission of Dow Jones, Inc. via Copyright Clearance Center, Inc. © 1999
Copyright © Houghton Mifflin Company. All rights reserved. Dow Jones and Company, Inc. All Rights Reserved. 14-224
Reasons for declining union membership
Lack of success in union organizing campaigns
Change in the the composition of the workforce
Management’s use of aggressive anti-union strategies
Increases in employee-friendly work environments

Decertification of Union
The process for decertifying a union:
The previous labor contract must have expired and no

new contract have been approved.
The union must have served as the official bargaining

agent for at least one year.
30% of the bargaining unit members must sign

decertification cards.
If the majority of voters in a decertification election

favor decertification, the union is removed as the
official bargaining representative.

Significant Labor Relations Trends
 Shifts in the overall economy
 The economy is changing to more knowledge workers and
downsizing to fewer workers in the smokestack industries

from which unions have traditionally drawn their strength.
 Union-management relations
 Labor unions, weakened due to loss of membership, have
become less confrontational and adopt a more conciliatory

approach to union-management relations.
 Bargaining perspectives
 Unions have shifted away from wage demands to focus
their bargaining efforts on maintaining current benefits and

job security issues.

Steps Employees Use to Form a Union
Generate union interest among employees

If less than 30% of
bargaining unit
Collect signed authorization cards
members sign
cards, process ends
Petition NLRB to hold election
If union is rejected
Secret ballot election held by majority vote,
process ends
Union signs up members, elect officers
Collective bargaining over first contract
Labor contract signed
Grievance procedure used to resolve

disputes during the life of the contract
Source: Ricky Griffin, Management, 6th ed. (Boston: Houghton Mifflin, 1999), p.
Copyright © Houghton Mifflin Company. All rights reserved. 439. Copyright © 1999 by Houghton Mifflin Company. Reprinted with permission. 14-228
The Collective Bargaining Process
 Mandatory items
 Items (e.g., wages, working hours, and benefits) that must
be included in the collective bargaining process if either
party expresses a desire to negotiate over one or more of
them. Mandatory items can be bargained to impasse.
 Permissive items
 Items that may be included in collective bargaining if both
parties agree to their inclusion. Permissive items cannot be
bargained to impasse.
 Impermissible (illegal/non-permissive) items
 Items that are illegal or discriminatory or that violate
federal, state, or local laws are not permitted in collective
bargaining.

Negotiating Labor Agreements
Develop a bargaining strategy from

Negotiation
previous experience and current
Preparation
labor market conditions.
Meet, discuss, bargain over

mandatory issues of wages, hours,
Conducting
working conditions. Both bargaining
Negotiations
teams make proposals and counter-
offers that lead to an agreement.

The Bargaining Zone
Employer’s Employer’s Employer’s

maximum limit expectation desired result
Bargaining zone
Union’s Union’s Union’s

demand expectation minimum limit
Source: Ricky Griffin and Ronald Ebert, Business, 5th ed. Reprinted
Copyright © Houghton Mifflin Company. All rights reserved. by permission of Prentice-Hall, Inc., Upper Saddle River, N.J. 14-231
Impasse
Don’t
ere
On Unfair B u y H
ke Locked
Stri
Out
Buy
Union-
Made
Striking Boycotting Picketing

Resolving Impasses
 Mediation
 A neutral third party (the mediator) reviews the information
presented by both sides and then makes an informed

recommendation and provides advice to both parties. The
mediator does not decide the matter, but rather provides a
channel through which negotiations can be revived after an
impasse has been reached.
 Arbitration
 Both parties agree in advance that they will accept the
recommendations made by the independent arbitrator.

 Final-offer arbitration
 The parties submit final offers to the arbitrator, who has to
choose one of the offers as an imposed settlement.

Angelo S. DeNisi &
Ricky W. Griffin
Managing the Work Environment
CHAPTER 15
Employee Rights in the Workplace
Discrimination law
Minimum wage
Employment
at
Labor law
Will
Rights to privacy

The Role of Discipline in Organizations
 Discipline
 is a formal organizational action taken against an
employee as a result of a rules violation, subpar

performance, or other dysfunctional behavior.
 Punishment
 is any behavior or action,
formal or informal, that

results in unpleasant effects
or consequences for
someone else.

The Dysfunctional Employee
Poor performance
Substance abuse
Criminal activity
Rules violation

The Hot Stove Approach to Discipline
Gives Fair
Warning
Certainty of
Application Uniformity of
Discipline

Typical Progressive Discipline System
First Offense: Verbal Warning
Second Offense: Written Warning
Third Offense: Suspension
Fourth Offense: Termination

An Alternative Approach to Discipline
First Second Decision-

Conference Conference Making Leave
Oral Written Decision

Reminder Reminder Day
Managerial reinforcement Commitment

or
Termination

The Physical Environment
 Hours of Work
 Circadian rhythms
are natural cycles that indicate

when a body needs to eat or
sleep.
 Illumination, temperature, and

office and work space design
 Have strong effects on employee
attitudes, decision making, and

job satisfaction.
Injury-Prone Businesses
Nonfatal Occupational Injuries: Number of Cases and Incidence Rates per 100
Full-Time Workers, for Industries with 100,000 or More Injury Cases, 1996
Total Cases Incidence

Industry (Thousands) Rate
Eating and drinking places 309.7 6.1
Hospitals 300.2 10.0
Nursing and personal care facilities 221.9 16.2
Grocery stores 211.6 9.7
Department stores 172.8 9.8
Trucking and courier services, except air 153.3 10.2
Motor vehicles and equipment 148.9 14.9
Air transportation, scheduled 148.4 18.6
Hotels and motels 118.3 8.9
Source: The Wall Street Journal Almanac 1999, p. 253. Republished by

permission of Dow Jones, Inc. via Copyright Clearance Center, Inc. © 1999 Dow
Copyright © Houghton Mifflin Company. All rights reserved. Jones and Company, Inc. All Rights Reserved. 15-242
Dangerous Occupations
Index of Relative Risk and Number of Occupational Fatalities Resulting from 1996
Injuries, for 10 High-Risk Occupations (Index for All Workers = 1.0)
Index of Number of Major Deadly

Occupation Relative Risk Fatalities Event
Fishers 37.5 66 Drowning (74%)
Timber cutters 33.1 118 Struck by object (76%)
Airplane pilots 18.5 100 Airplane crash (100%)
Structural metal workers 17.9 52 Fall (77%)
Extractive jobs 14.1 87 Vehicular (26%)
Water transportation jobs 12.8 42 Fall from ship (36%)
Garbage collectors 10.3 21 Vehicular (81%)
Public transportation attendants 8.4 38 Airplane crash (92%)
Construction laborers 7.5 291 Vehicular (29%)
Taxicab drivers and chauffeurs 6.7 65 Homicide (71%)

Common Workplace Hazards and Threats
The U.S. Department of Labor has identified seven

major categories of occupational illnesses:
1. Occupational skin diseases or disorders
2. Dust diseases of the lungs
3. Respiratory conditions due to toxic agents
4. Poisoning
5. Disorders due to physical agents
6. Disorders associated with repeated trauma
7. Other categories of occupational illness

Organizations and OSHA
 Occupational Safety and Health Act of 1970 (OSHA)
 authorized the U.S. government to create and enforce
various standards regarding occupational safety and health.
 The Department of Labor

 enforces OSHA standards through
on-site inspections of the workplace.

Inspectors can issue citations and
fines for major violations
of the standards.

Job Design in the Workplace
Job Job
specialization rotation
Job Job
enrichment Job Design enlargement
Job
characteristics

 Job design
 is the determination of an individual’s work-related
responsibilities.
 Job specialization
 is the degree to which the overall task of the organization is
broken down and divided into smaller parts.

 Job rotation
 involves systematically moving employees from one job to
another.

 Job enlargement
 was developed to increase the total number of tasks
workers perform on the assumption that doing the same

basic task over and over is the primary cause of worker
dissatisfaction.
 Job enrichment
 attempts to increase both the number of tasks a worker
does and the control the worker has over the job.

The Job Characteristics Approach
 The job characteristics approach
 is an alternative to job specialization that takes into account
the work system and employee preferences; it suggests that

jobs should be diagnosed and improved along five core
dimensions:
 Skill variety: the number of things a person does in a job.
 Task identity: the extent to which the worker does a
complete or identifiable portion of the total job.
 Task significance: the perceived importance of the task
the worker does.
 Autonomy: the degree of control the worker has over how
the work is performed.
 Feedback: the extent to which the worker knows how well
the job is being performed.

Job Characteristics Model of Job Design
Core job Critical Personal and
dimensions psychological states work outcomes
Skill variety
Experienced High internal
Task identity meaningfulness work motivation
of the work
Task significance High-quality work
performance
Experienced
Autonomy responsibility for
outcomes of the work High satisfaction
with the work
Knowledge of the actual
Feedback results of work Low absenteeism
activities and turnover
Strength of employee’s
growth needs
Source: J. R. Hackman and G. R. Oldham, “Motivation through the
Design of Work: Test of a Theory,” Organizational Behavior and
Human Performance, Vol. 16, 1976, pp. 250-279. Republished by
permission of Academic Press via Copyright Clearance Center, Inc. ©
Copyright © Houghton Mifflin Company. All rights reserved. 1976 by Academic Press, Inc. 15-250
The Causes and Consequences of Stress in Organizations
Organizational Individual
stressors consequences
Task demands Behavioral
• Occupation • Alcohol and drug abuse
• Security • Violence
• Overload Psychological
Physical demands • Sleep disturbances
• Temperature • Depression
• Office design Medical
Role demands • Heart disease
• Ambiguity • Headaches
• Conflict
Interpersonal demands
• Group pressures Organizational
• Leadership style consequences
• Personalities
• Decline in performance
• Absenteeism and turnover
Life stressors • Decreased motivation and
satisfaction
•Life Change
•Life trauma Burnout
Source: Reprinted from James C. Quick and Jonathan D. Quick, Organizational Stress and Preventive
Management, McGraw-Hill, 1984, pp. 19, 44, and 76. Copyright © 1984 by The McGraw-Hill Companies.
Copyright © Houghton Mifflin Company. All rights reserved. Reprinted with the permission of The McGraw-Hill Companies. 15-251
Most and Least Stressful Jobs
The most and least stressful jobs, based on such factors as quotas and
deadlines, long work weeks, the hazards involved, level of competitiveness,
physical demands, environmental conditions, contact with the public, need for
precision, and amount of stamina required.
Most Stressful Jobs Least Stressful Jobs

1. U.S. president 1. Medical records technician
2. Firefighter 2. Janitor
3. Senior corporate executive 3. Forklift operator
4. Race car driver (Indy class) 4. Musical instrument repairer
5. Taxi driver 5. Florist
6. Surgeon 6. Actuary
7. Astronaut 7. Appliance repairer
8. Police officer 8. Medical secretary
9. Football player (NFL) 9. Librarian
10. Air traffic controller 10. Bookkeeper

Angelo S. DeNisi &
Ricky W. Griffin
Managing the Diverse Workforce
CHAPTER 16
The Meaning of Workforce Diversity
Race
Gender Age
Religion Workforce Ethnicity

diversity
Disability

Trends in Workforce Diversity
 Changing demographics
in the labor force
 more women
 more minorities
 Increased awareness of
the competitive advantage
and benefits of organizational diversity
 Legislation and laws that outlawed discrimination
in the workplace
 Globalization of business, increasing the need for
businessess to learn to deal with different customs,
social norms, and mores

Immigration Trends into the United States
Immigration Rate Rises

The immigration rate reached a high just after the turn of the twentieth century,
when 11 of every 100 U.S. residents were immigrants. Today the rate is higher than
at any time since the 1910s. The immigration rate per 100 U.S. residents:
12
Rate per 100 U.S. Residents
0
1830 1840 1850 1860 1870 1880 1890 1900 1910 1920 1930 1940 1950 1960 1970 1980 1990
Years
Source: USA TODAY, February 28, 1997, p. 7A. Copyright 1997,

Copyright © Houghton Mifflin Company. All rights reserved. USA Today. Reprinted with permission. 16-256
Immigration Trends into the United States
National origin of immigrants is changing. A hundred years age, the greatest
number of immigrants were Europeans. Now they are Asians and Latin
100
Americans.
80
60
Percent
40
20
0 * *
Europe Asia Other Caribbean Central and Mexico 1 Africa
South America
1901-1910 (total: 8.8 million)
1951-1960 (total: 2.5 million)
1991-1995 (total: 5.2 million) 2
1
Mexico is singled out because of the large number of immigrants from that country.
2
Includes illegal immigrants granted amnesty.
*Not reported
Source: USA TODAY, February 28, 1997, p. 7A. Copyright 1997,
Copyright © Houghton Mifflin Company. All rights reserved. USA Today. Reprinted with permission. 16-257
Diversity Management versus EEO
Equal employment opportunity Diversity management
means treating people fairly and places a much heavier role on
equitably and taking actions recognizing and appreciating
that do not discriminate differences among people at
against people in work and attempting to
protected classes accommodate those
on the basis of differences to the
some illegal extent that is
criterion. feasible and
possible.

Age Distributions and the Workforce
Baby-boomers Declining
birth rates
Aging
workforce
Later Improved health

retirements and medical care

Age and Accident Rates
Fatal Injuries (1992-1993 data*)
25
20
Per 100,000 workers
15
10
0
15-19 20-24 25-34 35-44 45-54 55-64 65+
Age (in years) *Based on hours worked
Source: Michael Moss, “For Older Employees, On-the-Job Injuries Are More Often
Deadly,” Wall Street Journal, June, 17, 1997, pp. A1, A10. Reprinted by permission of
Copyright © Houghton Mifflin Company. All rights reserved. Dow Jones Company via the Copyright Clearance Center. 16-260
Changing Composition of the U.S. Workforce
10.6% 6.9% 1986
2.8%
 Black
 Hispanic 79.8%
 Asian and other
 White
11.0% 9.5%
4.1% 1996
75.3%
10.7% 11.7% 2006 (projection)

4.9%
72.7%
Copyright © Houghton Mifflin Company. All rights reserved. Source: The Wall Street Journal Almanac 1999, p. 226. 16-261
Diversity and Competitiveness
Resource Cost
acquisition argument
argument
Creativity Competitive Marketing

argument argument
advantage
Systems Problem-solving
flexibility argument
argument
Source: Ricky W. Griffin, Management, 6th ed. Copyright © Houghton Mifflin

Copyright © Houghton Mifflin Company. All rights reserved. Company, p. 181. Reprinted by permission. 16-262
Diversity and Conflict
Diversity Inappropriate
status behaviors
Gender Age
differences Conflict differences
Fear and Cultural

mistrust insensitivity

Individual Strategies for Dealing with Diversity
Understand
diin
ng Empathy unication
Commun
Tolerance

Organizational Strategies for Dealing with Diversity
Policies Practices Culture
Diversity
training

The Multicultural Organization
Pluralism
Full structural integration
Full integration of the informal network
Absence of prejudice and discrimination
No gap in organizational identification based on cultural identity group
Low levels of intergroup conflict
Source: Based on Taylor H. Cox, “The Multicultural Organization,” Academy of

Management Executive, May 1991, pp. 34-47. Reprinted by permission of the Academy
Copyright © Houghton Mifflin Company. All rights reserved. of Management via the Copyright Clearance Center. All rights reserved. 16-266

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Human Resource Management

Angelo S. DeNisi &

The Nature of Human Resource Management

Copyright © Houghton Mifflin Company. All rights reserved. 1-2

concerned with developing and maintaining a qualified

 Effective human resource management is a vital strategic

concern for organizations today.

Copyright © Houghton Mifflin Company. All rights reserved. 1-3

structuring individual jobs to maximize the efficiency and

and motion studies of each job task to develop “the one

Copyright © Houghton Mifflin Company. All rights reserved. 1-4

creation of specialized units to hire new employees and,

and the administration of legal and regulatory matters.

Copyright © Houghton Mifflin Company. All rights reserved. 1-5

 The results of Roethlisbeger and Mayo’s Hawthorne

 Important contributors to the human relations movement:

 Abraham Maslow and his “hierarchy of human needs”

Copyright © Houghton Mifflin Company. All rights reserved. 1-6

Copyright © Houghton Mifflin Company. All rights reserved. 1-7

 The HRM function–building a motivated and committed

 The 1980s and 1990s era of mergers, takeovers, acquisitions,

Copyright © Houghton Mifflin Company. All rights reserved. 1-8

Recruiting human resources

Selecting and placing human resources Basic compensation

Performance management Incentives

Training and Development Career Planning and Development

Managing the Managing Managing new

Copyright © Houghton Mifflin Company. All rights reserved. 1-9

The Organizational System

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Complying with Promoting

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Copyright © Houghton Mifflin Company. All rights reserved. 1-12

hiring, work scheduling, discipline.

 Certain HR functions may be subcontracted out.

Copyright © Houghton Mifflin Company. All rights reserved. 1-13

that handle specific HR administration activities and

Copyright © Houghton Mifflin Company. All rights reserved. 1-14

Director, Director, Director, Director, Director,

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The Organizational System

Copyright © Houghton Mifflin Company. All rights reserved. 1-16

 general management skills and abilities reflecting

conceptual, diagnostic, and analytical skills;

 knowledge of business and corporate strategy; and

 an understanding of the role and importance of the human

resource function for one’s organization.

Copyright © Houghton Mifflin Company. All rights reserved. 1-17

 Compensation and Benefits

 Employee and Labor Relations

 Training and Development

 Human Resource Planning

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 Human Resource Certification Institute (HRCI)

Copyright © Houghton Mifflin Company. All rights reserved. 1-19

Copyright © Houghton Mifflin Company. All rights reserved.

The Strategic Human Resource Environment

Human resource strategy formulation

Organization design Organization culture