shrm overall theories/concepts/principlest3.4 job analysis - components creating job descriptions...

SHRM Overall theories/concepts/principles

T2 Legal environmentT2.3 Sexual harassmentQuid pro quo

Hostile work environment

T2.4 Occupational health and safety -safety awareness programmes

Identify hazards

Reinforce safety

Promote safety

T2.2 Equal employment opportunity -3 theories of discrimination

Disparate impact

Reasonable accommodation

Disparate treatment

T3 Job analysis and work design

T3.2 Work-flow analysis - identifies:Processes

Work inputs

Work outputs

T3.3 Organisational structure

Dimensions

Departmentalisation

Centralisation

Structural configuration

Functional structures

Divisional structures

T3.4 Job analysis - components

Creating job descriptions

Creating job specifications

T3.5 Job analysis - approaches

Motivational

Biological

Mechanistic

Perceptual-motor

T1 SHRM explained

T1 Directional (growth) strategiesExternal growth

Internal growth

Downsizing (rightsizing)

Concentration

T1.4 Competitive advantage strategiesDifferentiation

Cost leadership

T1.3 Levels of linkage ee strategicplanning and HRM2. One-way linkage

3. Two-way linkage

1. Administrative linkage

4. Integrative linkage

T4 Recruitment

T4.2 Process

Set goals and strategic plans to address this

Implement and evaluate the goals and plans

Estimate labour surplus or shortage

Transition matrix

Leading indicator

T4.4 Policies

Lead-the-market pay strategies

Employment-at-will policies

Internal v external recruitment

Image advertising

T4.5 Sources

Direct applicants and referrals

Sources of recruits and forms of advertising

The recruiter

T5 Selection and retention

T5.2 Standards

1. Reliability

2. Validity

4. Utility

5. Legality

3. Generalisability

T5.3 Selection methods

References and biographical data

Physical ability tests

Interviews

Cognitive ability tests

Personality inventories

Work samples

Honesty tests and drug tests

T5.4/5 Turnover

T4.4 Involuntary

Principles of JusticeProcedural justice

Interactional justice

Outcome fairness

Fundamental principles

Progressive discipline

Alternative dispute resolution

Outplacement counselling

Employee assistance programmes

T4.5 Voluntary

Causes of Job dissatisfactionRole conflict

Role overload

Role ambiguity

Role under-load

Interventions

Job enrichment

Job rotation

T6 Training

T6.2 Effective training steps

1. Needs assessment

2. Ensuring employee's readiness for training

3. Creating a learning environment

4. Ensuring transfer of training

5. Selecting training methods

6. Evaluating training programmes

T6.5 Special training issues

Cross-cultural

Diversity

Onboarding and socialising

T6.1 Continuous learning for a competitive advantageInformal learning

Knowledge management

Formal training

T7 Performance Management

T7.2 Purposes of systemStrategic

Administrative

Developmental

T7.2 Features of system

Validity

Reliability

Acceptability

Specificity

T7.1 System parts2. Measurement through performance

appraisal

3. Performance feedback

1. Specifies which aspects of performanceare relevant to the organisation

T7.3 Measurement approaches

Attribute

Results

Comparative

Quality

Behavioural

T7.4 Limitations

Rater errors

Politics

T8 Employee Development

T8.2 Approaches Assessment

Interpersonal relationships

Formal education programmes

Job experiences

T8.3 Career management

1. Self-assessment

2. Reality check

3. Goal-setting

4. Action planning

T8.1 Considerations

Protean career

Boundary-less careers

Career resilience

Independent development plan (IDP)

T8.4 Special issues

Melting the glass ceiling

Succession planning

T9 Compensation

T9.3 ApproachesProfit-sharing

Individual incentives

Ownership

Merit Pay

Gain-sharing

Group incentives and team awards

Managerial and executive pay

T9.4 Benefits

Private group insurance

Retirement income

Social insurance

Pay for time not worked

Family-friendly policies

T9.3 Impacting theories Reinforcement Theory

Expectancy Theory

Equity Theory

Agency Theory

T10 Global environment

Transnational HRM systemTransnational representation

Transnational process

Transnational scope

T10.2 Factors to consider Education - human capital

Economic system

National cultures

Political-legal system

T10.4 - Strategic HRM

FunctionsTransformational

Traditional

Transactional

Improving effectiveness2. Measuring HRM effectiveness

3. Improving HRM effectiveness

1. Developing a strategy for HRM

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T10.1-3 SHRM in a globalenvironment (Ch15)

Challenges in theglobal environment

Expatriates

Tending to commit to shorter-terms now

High cost of compensation packages to entice people

Security/welfare is making it harder and more expensive to getpeople to take overseas postings in some places

Terrorism and increasing hostility to expats

Current global changes impacting on organisationsNorth American Free Trade Agreement (NAFTA)

(US/Canada/Mexico free trade and may expand to other SouthAmerican countries)

The growth of Asia - especially China

European Economic Community (EEC) and the EU

General Agreement on Tariffs and Trade (GATT)

Reasons for going global

Cheaper labour

Tax advantages

Gain economies of scale

Larger/new markets

Technology growth making it easier tobe geographically dispersed

Using time zones to offer 24/7 service

Increased/cheaper transport options

Factors affecting HRMin global markets

2. Education - human capital

Differences What is a common level of education in the country?

How much does the govt support education?

Implications

Low-cost but high skill labour will attract outside investment

Low-skill countries will be hard to recruit for certainroles and force expatriate requirements

Explained: productive capabilities of individuals (knowledge, skillsand experience that have economic value)

Example: Ireland/NZ have high than average graduate rates due to good govt financialsupport for tertiary studies. As Ireland is so accessible to Europe and post GFC had highunemployment rates, organisations needing high-skill labour were attracted there

3. Economic systems

Socialist economy Free education so easy to build human capital

No financial incentive to do so

Capitalist economy Costly education so difficult to build human capital

Strong financial incentives to do so

Compensation packages

Explained: need to balance the trade-off betweencost control and the need for local operators tocompete in the relevant labour market

Factors to consider:

Global firm strategy

Local regulatory/political context

Institutions and stakeholders

Local markets

National culture

Implication: For expatriate managers, organisations mustpresent a package that reflects the 'take-home pay' thatis competitive in their country of origin.

1. National cultures

Impacts on all other factors listed below

Explained: 'the set of important assumptions (often unstated) thatmembers of a community share.' (beliefs and values)

Classifications

Individualism v Collectivism - (USA 91H, NZ 79H, China 20L)

Power distance (cultural impact on hierarchical relationships) Real risk ofcross-cultural misunderstandings related to respect, i.e. using John or MrSmith to address people- (Philipines 94H, NZ 22L, Israel 13L)

Uncertainty avoidance (cultural impact on unpredictable future - 'weak'avoidance = easy-going, happy with less structure, 'strong' avoidance =structured) - (Greece 100H!, NZ 49M, Singapore 8L)

Masculinity v femininity - (Japan 95H, NZ 58M, Sweden 5L)

Long-term v short-term orientation (cultural impactbalance immediate benefits with future rewards) -(Japan 88H, NZ 33L, USA 26L)

Indulgence (not in text but on Hofstede website) - (Angola 83H,NZ 75H, Egypt 4L)

HR areas impacted

Manager-subordinate relationships

Decision-making processes

Selection processes and priorities - i.e. is person-job fit more/lessimportant than person-organisation fit?

Compensation systems, i.e. reflected in the differentiation eelowest and high paid roles in an organisation.

Fundamental approaches to communication,coordination and information sharing

Link Hofstede's country comparison

Findings on economic health, p.636 - Individualistic nations were morewealthy, collectivist cultures with high power distance were all poor.

Recent findings p.637: caution is advised on viewing everything through the lensof 'culture' - wider 'cultural' diversity can be viewed within a nation or anorganisation than is sometime seen between actual 'cultures'. Also individuals,regardless of where they live, will be drawn to organisations that 'fit' them.

4. Political-legal system

HR areas impacted:

Compensation

Employees' rights

Equity

Anti-discrimination provisions

Dismissal

Labour management relations

Training

Some examples:

Legal right to 'codetermination' in Germany

Social rights of workers under EEC's Community Charter,e.g. freedom of movement, association and job choice.

Equal employment opportunity in USA

NZ - Health and Safety at Work (General Risk and WorkplaceManagement) Regulations 2016

Managingemployees in aglobal context

Types of employees

Parent-country nationals (PCNs)

Host-country nationals (HCNs)

Expatriates (key points summary p.655)

Selection considerations

2. Flexibility and adaptability (adaptive skills p.646)

perception dimension

relationship dimension

self dimension

3. Job knowledge and motivation

4. Relational skills

5. Extracultural openness

1. Family situation

New construct - Cultural Intelligence (CQ)

'Inpatriates' p.644 - people from host nations working in the parentnation head office to provide transnational representation

Training and development

Understanding of own culture and how host country perceives it

Specific aspects of new culture

Language / communication requirements

Appreciation of host country cultural

Compensation

For expatriate managers, organisations must presenta package that reflects the 'take-home pay' that is

competitive in their country of origin.

Organisation needs to cover extra costslike tax, cost-of-living, healthcare, etc

ReacculturationKey minimisers

Communication - info from home while abroad

Validation - Recognition for work done and future direction

20-25% of expat managers turnover within 1yr of return

Third-country nationals (TCNs)

Adler's Levels of global participation - p.643

International (one or more facilities in one other country)

MultinationalOne or more facilities in a number of different countries

Develop and distribute identical products worldwide

Domestic only (still face some cultural diversity challenges)

Global

Customised products or servicesfor clients in many countries

Synergy with local cultural variations

Multiple headquarters around the world -decentralised decision-making

Requires managers and executivesthat are transnationally competent

Requires Transnational HRM systems

HRM decisions with aninternational perspective - fair across the org,

but flexible for the local environments

Transnational scope -

- multiculturalcomposition of management team

Transnational representation

- planning and decision-making processes include representations and

ideas from a variety of cultures

Transnational process


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T10.4 - Strategically managing the HRMfunction (Ch16)

HRM functions

Traditional

Recruitment and selection

Training

Performance

Performance management

Employee relations

TransactionalRecord keeping

Employee services

Benefits administration

Transformational Strategic redirection and renewal

Cultural change


Management developmentTo manage the HRM function , HRexecutives need to:

strategically

Measuring HRM effectiveness -approaches

Audit approach (both quantitative and qualitative)- table of examples p.672-3

Analytical approach(quantitative in nature)

Determining whether the introduction of aprogramme or practice has the intended effect

Estimating the financial cost and benefitsresulting from an HRM practice

HR accountingCapitalisation of salary

Net present value of expected wage payments

Returns on human assets and human investments

Ultility analysis

Turnover costs

Absenteeism and sick leave costs

Gains from selection programmes

Impact of positive employee attitudes

Financial gains of training programmes

Using analytical data to increaseorganisational effectiveness Improving HRM effectiveness

Restructuring

Outsourcing

Process reengineering

Use of new HRM information systems

HRM software applications

Develop a strategy for HRM

How well are our customers' needs being met?

What products and services do we provide?

What are their needs?

Who are out customers? (internal)

Basic process for HR strategy (p.667)

Communicate the HR strategy

Develop HR strategy

(lack of...leaders, tech savvy, diversity, etc)Identify people issues

(is it expanding,going international, needing new technology, etc)

Identify strategic business issues

(futuretalent shortage, aging workforce, etc)

Scan the external environment

Ways to involve line executives in process (p.669)Have one or two be part of the HR strategy process

Communicate the HR strategy to all of them

Interview/survey a large number (all) of them

Have senior executive team sign-off on the strategic plan


T3: Job Analysis and Work Design

Work-flow design: analysing the tasks required forthe production of a product/service (147)

Work Outputs (products/services) Quality

Quality

Work Processes (improve efficiencies through)Movement that creates no value

Inconsistent production that creates excessive inventories

Overburdening of specific people or machines

Can be leveraged to create a competitive advantage

Work InputsEquipment / facilities / systems

Human resources (KASOs)

Raw materials / data / information

The job analysis role of HR has animpact on all areas of HR (161)

Training

Performance appraisal

Selection

Career Planning

HR Planning

Job Evaluation

Work redesign

Outcomes of Job Analysis

Job Description (TDRs) (163) - (Observable)Duties

Responsibilities

Tasks

Job Specification (KASOs) (164) - (Not directly observable)

Ability

Skills

Other characteristics

Knowledge

Organisation Structure: relationship betweenroles within the organisation (153)

Can be leverages to create a competitive advantage

Dimensions of Structure : Degree to whichdecision-making resides at the top.Centralisation

Departmentalisation

Configurations (ways tocombine dimensions)

(e.g. course/foh/admin)Functional

Con: Functional Silos

Inward focus on departments, struggle tosee wider organisational goals.

Finger pointing as departments do notunderstand what others departments do

Characteristics

Values control and efficiency

Highly centralised and bureaucratic

Better for organisational based on 'cost' strategy

Jobs: Narrow and highly specialized

Pros Good in stable and predictable environments

Efficient due to reduced duplication

(based on work-flowareas, i.e. geography)

Divisional

Pros

Can be more flexible/fast/innovative

One division may fail, but others cansupport it or go on without it.

Good in unpredictable environments

Greater autonomy and responsiveness

ConsCan be inefficient due to duplications

Divisions can 'cannibalise' each other

In tough times, all divisional may cost cut in the same area, i.e.R&D, leaving the whole organisation weak

Characteristics

Decentralised with 'local' control and accountability

Research suggests 150pax is max size for efficiency -larger and people start to loose accountability

Better for organisations based ondifferentiation or innovation strategies

Or some combination of both?

Job Analysis

CharacteristicsFoundation of recruitment and selection

Basis for job descriptions TDRs and job specifications (KASOs)

Basis of job design

MethodsPosition Analysis Questionnaire (PAQ)

The Occupational Information Network (O*NET)

Sources

Current employee

Risk Anaylysis

Time Anaylsis

Supervisor over current positionPriority analysis

CustomersServices analysis

Outside job analystsSkill level analysis

Job Design


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T5: Managing Turnover (Ch10)

p.423 (Orgdecision to terminate)

Involuntary Turnover

Principles of Justice

Categories

: Was the decision delivered andimplemented in a socially sensitive, considerate and empathicway?

Interactional Justice

: Was the procedure followed consistent,unbiased, accurate, correctable, representative and ethical?Procedural Justice

: Was the outcome fair relative to how othershave been treated?Outcome Fairness

Reasons

Very much in the perception of the recipient

Moral motivation

Less likely to lead to legal action

Makes good business senseas it protects reputation with:

Current employees

Future employees

Customers and suppliers

Progressive Discipline

Discipline needs to be escalated gradually

Managers should document all steps clearly

Employees should be given feedback and the opportunity toimprove

Alternative dispute resolution

Stage 2: Peer Review

Stage 3: Mediation involving a neutral third party

Stage 1: Open door policy

Stage 4: Arbitration by a qualified arbitrator

Employee assistance programmes (EAP)

Designed to deal with personal issuesthat may be impacting on performance

Funded by the employer

Employee avoids formal disciplinary actionswhile participating in a programme

Outplacement counsellingProvided by an independent party

Can be a group arrangement

Provided to displaced employees

Funded by employee

Helps with transition to job seeking and new employment

p.433(Employee decision toleave)

Voluntary Turnover

ReasonsLow satisfaction

Sources

Personal disposition

Low self-evaluation

Negative affectivity / Theory X

Tasks and roles

Role issues

Role under-load

Role overload

Role conflict

Role ambiguity

Task aspectsFlexibility of where/when

Value employee perceives in task

Complexity

SupervisorsLevel of 'warmth'/civility

Support for work and career goals

Competence

Co-workers

Pay/benefits Relative to organisation

Relative to market

Stagnant professional growth

Values alignment

Perception and frame of reference

Unsafe working conditions

Prosocial motivation

Level of 'meaning'

OutcomesBehaviour change

Physical job withdrawal

Psychological job withdrawal

SolutionsRole analysis technique

Job rotation

Can increase meaning through understandinghow each job fits into the organisation

Supports redundancy

Job enrichment programmes

found to increase opportunity for worked to haveinput in to decisions the involve their work

found to reduce role conflict and ambiguity

Monitoring job satisfaction (strategic - survey-feedback process based on action research)

Pay Satisfaction Questionnaire (PSQ) p.445

Job Descriptive Index (JDI) p.444

Regular 'Pulse' surveys which focuson a specific topic/question p.445

Employee Survey Research - monitors trends andidentifies potential problems before the grow

Monitoring provides empirical evidence of the impact ofchanges to policy, personnel, mergers, etc p.446

If standardised (above) can allow for benchmarking p.447

Benchmarking can identify what org offers betterthan industry and therefore can provide a basis for

screening applicants for the right 'fit' p.447

Benchmarking can also be between different business unitswithin an organisation to ensure consistency and guides for

'best practice' across the organisation, p.447

Vital that survey data includes exit interviews withemployees who are leaving, this gives valuable data and

indications of problem areas p.448

Offer flexible family-friendly policies - live themReduced abseenteeism

Raises commitment levels

Attracts best applicants

Warm and competent supervisors and co-workers results in:

Working longer hours

Ok with delayed gratification

Promote regular social eventsthat promote team building

Actively monitor and deal worth workplace bullies

Monitor market pay rates and ensure you stay at or above

Preventative measures

Provide meaning and context to staff(example Edwards Lifesciences article)

Screen job applicants for negative affectivity (Zappos)

Temptations from competitive labour market


T6: Training (Ch7)

Benefits

Upskill for technology

To work effectively in teams

Increase knowledge of foreigncompetitors and markets

To boost company culture

Increase knowledge ofcompetitors and markets

To ensure job security in face ofchanging environment

To improve cohesion, especiallywith minorities and women

Ultimately to improve customer satisfactionand gain competitive advantage

Continuous LearningSystem

Informal learning

Learner initiated and controlled

Action oriented

Key to gaining 'tacit' knowledge

Example: Informal mentoring ee myself and CE


Designing and implementing tools, processes, systems, culturesto improve the creation, sharing and use of knowledge (p.266)

Enables and promotes informal learning

Formal training

Organisation initiated as part of the role

Can be action or classroom oriented

Key to gaining 'explicit' knowledge

Example: LCQ / apprenticeship

Result - Human Capital

advanced skills (know how)

system understanding and creativity (know why)

knowledge (know what)

motivation to deliver high-qualityproducts and services (care why)

Vital componentsLinked to business strategies

Linked to performance objectives

Supported by management and leaders

Use a variety of mediums

Be assessed for ROI

Training Needs Assessment (ADDIE Model- Analysis Design / Development /Implementation / Evaluation)Six step process (p.268)

4. Ensuring transfer of training

Self-management strategies

Persevere against relapses in behaviour

Ask for feedback when needed

Create intrinsic motivation / reward

Identify barriers

Set goals

Peer support

Opportunities to use learned capabilities

Work envrironment

Trainee motivation

Climate for transfer

Technological support (e.g. XeroTV/XeroU)

Manager support

Support attending training and emphasise importance

Provide opportunities to use training content

Create an with an employee 'Action Plan'

what training content will be used and how?

strategies for reaching goals and resources needed

planned feedback

expected outcome - what will be different?

5. Selecting training methods

Presentational methodsdistance learning

audio-visual techniques

classroom instruction

Hands-on method (pp.285-293)

self-directed learning

apprenticeships

on-the-job training (OJT) - key principles on p.286

simulations

business games and case studies

behaviour modelling (best for interpersonal skills)

interactive video

e-learning (e.g. MOOCs)

Group-building methods (p.293)

team training

Pit crew U example for United Airlines

Cross-training - making sure people are trained in others teammembers jobs so they can step in if needed

Coordination training - to maximise efficiencies in decision makingand sharing information

Team leader training

action learning - using an actual taskor project as the vehicle for learning

outcomes

organisational outcomes

personal learning

componentstreating each other as peers

reflecting on both the task and the process

providing a supportive challenge

experiential programmesaction learning

DaVita prosthetic hand example

How to choose? - things to consider

Consider the trainees - generationally

Is it for a group = group method

Geographically / culturally dispersed?

Consider budget and time

Business Strategy implications

3. Creating a learning environmentPractice

Feedback

Meaningful material

Observation of others

Identification of learning objectives and training outcomes

Administering and coordinating programme

'Communities of Learning'

6. Evaluating training programmes(tables outlining these on p.297)

Cognitive outcomes

Skill-based outcomes

Affective outcomes

Return on investment / cost-benefit analysis(steps/eg for ROI listed on pp.299-300)

Results

2. Ensuring employees' readiness for training'Motivation to learn' (p.275) (Attitudes and motivation)

Increases results of...knowledge gain

behaviour change

skill acquisition

How managers can increase... (p.276)

self-efficacy

understanding benefits of training

being aware of training needs, career interests and goals

understanding work environment characteristics

ensuring employees basic skill levels

Basic skills

1. Needs assessment

Task analysis (what needs to be taught)

Person analysis (who needs training - If poorperformance is a factor, will training actually help?)

Organisational analysis (context)Does training fit strategic objectives?

Resource allocationTime

Skills to train - internal/external

Budget

Support of managers/peers for training - this is key to thetrainee feeling confident to apply training to their job.

General notesSteps can overlap

Feedback from any stage useful for other stages

Must be systematic to be fully effective

Reasons for training - 'pressure points' (p.269) Customer requests

New products

New technology

Higher performance standards

Poor performance

New jobs

Lack of basic skills

Business growth or contraction

Legislation

Global business expansion

Special training issues (pp.300-309)

Diversity

Diversity training

Managing diversity and inclusion (key components table p.306)

There is as yet no research that shows a direct link betweendiversity and improved business outcomes. (p.304)

Onboarding and socialisation

Steps

Compliance: paperwork and understandingpolicies/rules/regulations

Clarification: understand job andperformance expectations

Culture: understanding company history,traditions, values, norms, mission

Connection: understand and developworking and interpersonal relations

Cross-cultural preparation (foreign assignments)

Preparation phases

Pre-departure phase

Family / life needs

Career pathway

Cultural norms

Language

On-site phase

Repatriation phase (avoiding re-entry shock)

Keys to success

Family support and supported

Well prepared for cultural aspects

Personality traits: agreeable/extroverted/conscientious

Factors that impact training type and extent:interaction - how much interaction with locals

job novelty - how different from current role

Cultural novelty - how different it is from the expat

Training strategies (p.170) Job enlargement

Job enrichment

Training to support four major business strategies Internal growth strategy

External growth strategy

Concentration strategy

Divestment strategy


T7: Performance Management (Ch8)

Performance management systemMeasures those aspects of performance

through performance appraisal

Provides feedback to employees through sessionsperformance feedback

Specifies which aspects of performanceare relevant to the organisation

'Model of the Effective PerformanceManagement Process'

Step 1: Define performance outcomes for company divisionand department

Step 2: Develop employee goals, behaviour, and actions toachieve outcomes

Step 3: Provide support and ongoing performancediscussions - REGULAR!!

Step 4: Evaluate performance

Step 5: Identify improvements needed

Step 6: Provide consequences for performance results

Examples

'Check-Ins' used by Adobe instead of annual performancereviews - these should be every other month. (p.319)

Weekly check-ins are also used at Deloitte, along withproject terms reviews, p.331

Purposes of performance management systemsAdministrative purpose - support decisions aroundpay/promotions/recognistion/terminations/etc

Development purpose - identify performance improvementopportunities and support decisions for planning and

resourcing these

Strategic purpose - identify things to support the strategicgoals of the organisation

Performance management systemsMUST demonstrate:

Reliabilityinterrater reliability - is there consistency from different raters

internal consistency reliability

test-retest reliability - consistency across different time periods

Acceptability

By managers

By employees

By administrators

Is it fair? (p.330)Interpersonal fairness

Outcomes fairness

Procedural fairness

ValidityContamination - evaluating things that do not directly impact onjob performance

Deficiency - not evaluating all aspects of a role

Specificity

Strategic congruence

Approaches to measuring performance, p.331-351 -summary table against criteria on p.351

Attribute approach - how much does the employee havecertain attributes, e.g. initiative, leadership, competitiveness

ProsGeneralisable across an organisation

time spent relating closely to job, can be reliable and validIF

Easy to develop

Cons

GRS version is very subjective, so needsto be backed up with hard data

If weak descriptors used, can be low on reliability and validity

Vague and therefore open to interpretation of rater

Little guidance provided on how to improve performance

Little strategic congruence

Low scores can lead to defensiveness in employees

Types Graphic rating scales, e.g. p.336

Mixed-standard scales, e.g. p.337

Results approach, e.g. p.343 - based on strategic goals,flowing down the organisation, setting goals at each level

that are linked.

Types

Balanced scorecard, p.344 Customer perspectives

Internal or operations perspectives

Financial perspectives

Learning and growth perspectives

Productivity Measurement and Evaluation System (ProMES)p.345

Pros Provides objective, quantifiable measures

Strong strategic congruence

Cons

Focused on results, not how you get there so can encourage poormethods / behaviour

Contamination - external factors influencing results

Deficient - not all job aspects can be objectively quantified

Can lead to helping co-workers less if performance is based onindividual results

Results is useful feedback but doesn't provide direction forimprovement

MethodDetermine measurements, e.g. time/quality/quantity / financialmetrics

Determin rewards / incentives

Set SMART goals related to org strategic goals

Comparative approach (p.333) - comparing against otheremployees

TypesRanking (1, 2, ...)

Paired comparison

Forced distribution (predetermined scale)

ProsGood for administrative purposes

Easy to develop and use, making them acceptable

Virtually eliminates leniency, central tendancy and strictness

ConsOpen to bias, subjective, so moderate on validity and reliability

Commonly low on strategic congruence

Low on specificity of feedback to improve

Quality approach - customer orientation, p. 347

Characteristics

Customer orientation

Prevention approach to errors

Continuous improvement

Is a combination of 'attribute' and 'results' approaches

Expected to:

Consider both person and system factors in the appraisal

Ensure managers and employees work together on performanceissues

Involve both internal and external customer in settting standardsand measuring performance

Use multiple sources to evaluate person and system factors

NOTE: These are unique to Quality approach and are allcharacteristics of an effective performance management system.

Types of feedback advocated, p.348:

subjective feedback from managers, peers, customers

objective feedback based on the work process itself usingstatistical quality control methods,

Behavioural approach - assesses specific, desiredbehaviours

Types

BARS - Behaviourally Anchored Rating Scales, e.g. p.340

BOS - Behavioural Observation Scales, e.g. p.341 (like a schoolreport)

Competency model, e.g. p.342

Pros

BOS is found to be prefereed to BARS or Graphic rating scales asgive good feedback and easy to use

Can be linked to strategy

Gives good feedback and direction

Generally acceptable, reasonably reliable and valid

Cons

BOS can be very time consuming to do for multiple people

Assumes there is 'one best way' to do the job, ok for less complexjobs, but not so much for complex ones where there might bemultiple ways to get good result

Needs to be continually monitored for relevance and updated

Sources of performance information, p.350

Subordinates

Can create a power imbalance where managerstry to 'please' subordinates to improve ratings

Best used only for developmental purposes,like peers, not administrative purposes

To be effective the must be anonymousand have at least 3 raters taking part

Self

Good to create a 'conversation' about performance and issues

Empowers employees and gives them a voice

Can be inflated, especially if used for administrative purposes

People naturally have a tendency to external attribution of faults

Peers

Can have bias (good and bad)

Good technical knowledge

Regularly observe ratee

Good for development purposes, but not so muchfor administrative purposes such as pay rises asraters may feel conflicted

Customers

Great for 'services' where only the customer observes theemployee in the act of their role

Things like email databases and software like survey monkeyhave made this option much more available

Managers

Can have bias (good and bad)

Good technical knowledge

Can be difficult if not observingemployee regularly

360 degree model - uses 4(Netflixs is example of this)

Modern era

Gamification - Use game-based strategies to makea system fun, effective, transparent and inclusive.

Electronic tracking and monitoring systems - to trackwhere/how/what people are working and limit access to e.g.

porn. This can be useful for OSH/customer updates etc,e.g. truck driving/on-site servicing. BUT must be carefully

balanced with Trust/Big Brother effect.

SPM - Social Performance Management -use online platforms to provide regular 360

degree feedback opportunities

Subjective issues with ratings (p.358) Rater Errors

Contrast

Leniency

'Similar to me'

Strictness

Central tendency

Halo

Horns

Appraisel Politics - intentional distortion strategies to suitpersonal or company goals - i.e. rating someone higher thanthey are in order to justify a promotion, or rating someoneintentionally lower to make them leave.

Reducing rater errorsFrame-of-reference training / Rater accuracy training

Rater error training

Calibration meetings

Effective feedback processpraise

problem-solving approach

employee participation in session

focus on behaviours/results, not the person

self-appraisal before session

minimise criticism, 1-2 examples generally sufficient

create the right context for the discussion

agree to specific goals and timeframe to review - SMART

regular feedback, not once a year


T8: Employee Development (Ch 9)

The changing nature of a 'career'

'Protean career' - ability to change regularly, versatile. Thejungle gym, not the ladder. The driver is 'psychological

success', i.e. pride/accomplishment.

Boundary-lesscareers haveemerged becauseemployees:

move across employers/professions

may identify more with a profession than an employer

consider personal/family needs when considering careers

pursue personal goals through work, not just company goals

Career resilience - the capacity to adapt to organisationchanges by building portable knowledge and skills.

Development features

IDP - Individual development plan

70-20-10

70% comes from on-the-job

20% from relationships and informal learning

10% from formal courses

Future-oriented - focus on requirements for future changes,not directly to the employees current role

Reduces job hopping as employees feel they have goodopportunities to develop skills/experiences right where theyare

Training v Development (p.379)

Use of work experiencesD = High

T = Low

GoalD = Preparation for changes

T = Preparation for current role

FocusD = Future roles

T = Current role

Participation

D = Voluntary

T = Required

NB: The strategically integrated training anddevelopment become, the more blurred the

distinction ee them will become.

Approaches

Formal education programmes

Corporate universities

Courses

Job experiences

Projects

Overseas postings

Promotion

Downward move to focus on something specific

Transfer

Job rotation

Secondment or externships

Job exchange

Job enlargement

Sabbatical

Stretch assignments

NB: Consider if these create positive or negative stressors (p.395)

Interpersonal relationships

Modelling

Coaching

Group mentoring programmes

Mentoring

Only limited by:Access to required knowledge/skills for implementation

Willingness towards development

Awareness of options available

Assessment

Development assessments

Psychological testing or personality profiling

Assessment centres

Performance assessment (table 9.5 p. 393 - Skills related tomanagerial success)

Career management or development planningsystem (p.381)

Step 3: Goal-setting

Step 2: Reality check

Step 4: Action planning

Step 1: Self-assessment

NB: Example IDP p.383

NB: Table 9.2 Design factors of effective developmentsystems, p.384

Melting the glass ceiling, p.405

How?Gather data on problems causing the glass ceilingusing task forces, focus groups, and questionnaires.

Create awareness of how genderattitudes affect the work environment.

Make the change public

Force accountability through reviews ofpromotion rates and assignment decisions

Make a business case for change

Promote development for all employees

Make sure senior management supportsand is involved in the programme.

Succession planning - table 9.11, p.407

Blockers, p.409

Talent inventory, p.410

9 Box grid, p.408

Do you make the 'potentials' list public? advantagesand disadvantages discussed on p.411


T9: Compensation

If pursuing a Concentration Strategy

Define: Focus on retaining current skills (p,88)

Appraisal implications: focus on behaviour as this is a stableenvironment with clear effectiveness guidelines (p.88)

Compensation implications (tg):

Centralised pay system

Job-based pay - stable workforce with low growth rate

Fairly fixed base salary - low risk, less variable pay

Offer above market benefits - to attract quality people

Questions to consider in acompensation approach:

What is the expected ROI?

How is the approach to be communicated tomanagers and staff?

What are the costs?

What level of participation in decision-making will be given to employees?

How does the approach fit with strategy?

Pay structures and decisionsPay levels

p.459EQUITY THEORY

External equity - same jobs /different organisations

Internal equity - different jobs /same organisation

Explained: That people with calculate theperceived outcomes and the perceived inputs,

then compare these to others and come up witha favourable or unfavourable judgement.

Result: If they find things unfavourable, theywill work to rectify this situation through:

Increase outcomes, i.e. theft / asking for a payrise

Leave or stay but become dysfunctional

Reduced input

Pressures

Upper limit contraint - what the productmarket will allow to remain competitive

Lower limit constraint - what the labourmarket with allow to remain competitive

Are the employees an expenses or an asset?

(p.463) - When does the benefitsof higher pay outweigh the cost?

EFFICIENCY WAGE THEORY

When technology or structure requires high skill

When employees are not highly supervised

Benchmarking with help determinewhat the market rate is

Method: Market Pay Surverys (p.463)

Consider both product and labour market surveys, weighting eachdepending on problem areas

Also consider revenues/employee and revenues/labour cost to geta better understanding of ROI in other organisations

Also need to consider; product quality, customer satisfaction,workforce quality (i.e. education/skills levels)

Strategic goals will determine where an organisation should sitagainst the market norms, at/below/above

Job-based pay structure

Job evaluation

Determines compensable factors - aspects ofvalue that the organisation will pay forLevel of decision-making

Required education

Job complexity

Responsibility / reports

Working conditions

Required experience

Point-factor system - system of job evaluation

Problems - bureaucracyplus see topic guide

See list on topic guide

Government regulations

Overtime regulations

Taxation

Minimum wages

Superannuation entitlements

Bureaucracy

Responses to problems

Delayering and banding

Paying the person

Knowledge based systems

Competency based system

Skills based system

Fundamental theories of human behaviour

p.459EQUITY THEORY

External equity - same jobs /different organisations

Internal equity - different jobs /same organisation

Explained: That people with calculate the perceived outcomesand the perceived inputs, then compare these to others and come

up with a favourable or unfavourable judgement.

Result: If they find things unfavourable, theywill work to rectify this situation through:

Favourable comparisonIncreased cooperation

Increased effort

Unfavourable comparisonReduced input

Increase outcomes, i.e. theft / asking for a payrise

Leave or stay but become dysfunctional

REINFORCEMENT THEORY

Explained: When reward is clearly linked to and follows highperformance.

Result: Continued high performance

Best when:

Link is clear and recognised by employee

Reward closely follows behaviour

EXPECTANCY THEORY

Explained: Focuses on the power of incentives - similarto reinforcement theory but focuses on the 'expected'

rather than a previously experienced reward

Three primary determinants of successful incentivesEmployees perception of how strong the link is

The value of the reward to the employee

Strength of the link ee performance and reward

AGENCY THEORY

Players'Principal' (Owner OR Manager)

'Agent' (Manager OR Employee)

Explained: Risk-reward trade-off of the divergent interests of theorganisations stakeholders

Examples where interests diverge and cause agency costs:

Goals: Shareholder goal to maximise wealth, manager goal tomaximise prestige or personal pay = manager may expend on

extravagant but non-value-adding endeavours

View on risk: With diversification, shareholders can be morewilling to take risks than managers whose job/income will be on

the line and therefore make them risk averse. - This may be seenin the projects they pursue but also in their own pay structure

which if they can control it, may be more likely to be focused on agood base salary than contingent on a bonus structure that is

more at risk

Decision-making horizons: Manager may focus on short-termgoals as they will likely move to other companies, owners are in it

for the long haul so may focus on long-term goals.

How to reduce 'agency costs'?

Options'Outcome based pay contract' - greater risk for 'Agent' so

'Principal' offers greater reward (compensating wage differential)

'Behaviourally based pay contract - greater risk for 'Principal' soreduced reward for 'Agent' - may require more monitoring to avoid

information asymmetry

Factors to consider when choosing and option:

Risk aversion - favours 'behavioural'

Outcome uncertainty - managers will favour 'behavioural'

Job programmability - less routine means monitoring is moredifficult and therefore favours 'outcome'

Measurable job outcomes - favours 'outcome'

Ability to pay - 'Outcome' costs more in good times, so may beless likely if the organisation simply cannot afford it. (Self - could

greatly benefit where high economies of scale can be gained)

Tradition - 'Outcome' is becoming more popular, but if tradition isagainst it, it may not be viable.

The principal must choose a contract structure / compensationpackage that will more closely align the agent with the principals

goals/risk comfort/decision making tendencies.

Agency costs caused by two factors:Player goal incongruence

Player information asymmetry

Different pay programmes(summary table p.504)

Managerial and executive pay

ContingentIncreasingly oriented to 'contingent pay'

Contingent on short or long term goals

Relatively low base salary with significant bonus potential

This supports 'Agency Theory' ideas ofaligned owners/managers goals

Balanced scorecard can be used to link different incentivesand pay programmes together on a combination of areas.

can be used to link different incentives and pay programmestogether on a combination of areas

Example p.518

Includes financial kpis along with other areas such asservice/quality/development

Financial performance can be seen as a 'lagging indicator' -picture of the past

Service and employee metrics can be seen as 'leading indicators;- predictor of the future

Intrinsic v Extrinsic Motivation, p.499

Some evidence suggests some area find an increase in extrinsicrewards, decreases intrinsic motivation, such as education

However in the workforce, where pay is the norm and is anextrinsic reward, there is some evidence to suggest higherextrinsic rewards results in an increase in intrinsic motivation,perhaps as overtime people end up in jobs that 'fit' them in termsof the rewards they need to be motivated.

Individual focus

Merit pay

Characteristics

generally based on annual appraisals

Pay rises linked to performance

Very common but scarce evidence of effectiveness

Often uses a 'merit increase grid' to determine % increases

Weaknesses

Ignore factors out of the employees control

Generally only one judge - supervisor/manager

Even best performers only get minimal reward compared tomediocre performers

Early large raise can reduce motivationwhen minimal raises follow

Can individualise people and discourage teamwork

Can encourage dysfunctional behaviour just to meet results

Individual incentives

CharacteristicsNeed to be earned and re-earned

Tied to objective, measurable outcomes

Not part of base pay

Weaknesses

Administrative complications

Can lead to dysfunctional behavioursimply to get the reward

Do not fit team or group approach

Some jobs have no 'measurable' outcomes

Discourage development as this may taketime away from earning reward

Can reward volume at the expense of quality/service

Group focus

Organisation-wide

Profit sharing

Characteristics Reduce self-interest and promote teamwork, collaboration andcontribution

Not a fixed cost, variable with organisation performance

Not tied to base salary

Get employees to think more like owners

Weaknesses

Reduce motivation due to negativeeffects of business downturn

Some uncertainty about the realmotivational impact of profit sharing

Reduce motivation if payments are deferred

Can be negatively comparedto other organisations

Agency Theory implication - lower wage agents assume more riskin this situation, so need to be given larger reward as a result

Ownership

Stock Options Some organisation, e.g. McDs, have extended this to all levels

Popularity is waining, in part due to tax changes

Employee stock ownership plans (ESOPs)

Similar to profit-sharing but even stronger link to overallorganisation performance

Does not meet 'Reinforcement theory' requirements of'experiencing the rewards as benefit is not experienced untilshares are sold and this is often upon leaving the org

Links to 'Agency theory' in getting employees to think like owners- at least at the higher levels - not clear about lower levelemployees

Specific groups

Gain-sharing

Sharing productivity gains with employees in specificdepartments/groups

Works people with the 'workers' than profit sharing because theyhave more input/control over the results

'Scanlon Plan' is an example of this - see p.517

Evidence shows does improve performance

Needs a number of measures in place to work - see TG

Group incentives and team awards

Like gain-sharing but with a small work group

Can benefit from being part of a balanced scorecard

The ' 'sorting effect ExamplesPay linked to individual performance willattract individualistic, risk-oriented people

Pay based more of 'team performance' willattract people who are team-oriented

Explain: The effect pay structures can have onattracting and retaining certain types of employees.

Implications: Organisation must link their pay structuresto their overall organisation and HR strategies

Fairness assessment on any pay-for-performance programme (p.507)

Procedural fairness - how it is decided

Distributive fairness - how much one receives

, p.513, great extractwith multiple examples of this practice. Especiallyrelevant to profit-sharing situations.

OPEN BOOK MANAGEMENT

Employee Benefits

Factors to growth Schemes can use stock options instead of cash

Group buying power can lead to more value

Deferred income (i.e. retirement fund) further reduces tax liability

Focus of union negotiations as there is more flexibility

Greater value than dollar equivalent

Used to differentiate in the labour market - can stronglysignify the 'culture' of the organisation and therefore attractemployees who are a good 'fit' - e.g. Patagonia p.540

Tax benefits for both parties

Self: Generational factor and changing nature of workforce

Increased legislation

Some categories

Social insurance (not applicable in NZ as covered by Govt/Acc)

workers compensation

unemployment insurance

social security

Private group insurancei.e. health insurance

Retirement income Not as common in NZ as covered by Govt and KS

Higher level positions may have additional benefits

Pay for time not worked

Sick leave / maternity leave / holidays

In NZ minimums prescribed by law

Benefits therefore are those that go beyond the minimumrequirements, i.e. birthday leave, additional maternityleave such as teachers union agreement

Family-friendly policiesThis area has considerable scope for additional benefitsand with the increasing focus on women in theworkforce is becoming a key differentiation strategy fororganisations who want to target this market

Exampleschild-care support

parental leave

work hours/location flexibility

Topic guide outlines considerations for effectivemanagement of these types of benefits

Characteristicsspecific to benefits

over standardcompensation

Some have become expected and therefore not offering them canreduce competitive edge in labour market

Hard to understand and communicate value

Require careful legal compliance, from mandatory minimums tospecific tax treatments

Somewhat subjective to value, i.e. health benefits may be morevalued by older employees than younger ones, so the org doesnot necessarily get the same ROI on across the board benefits

Before instituting ANY benefits, an organisation mustunderstanding if it is a true benefit to their specific employeesneeds


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