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HU MAN RESOURCE

THIRTEENTH EDITION

MANAGEMENT

GLOBAL EDITION

GARY DESSLER

FLORIDA INTERNATIONAL UNIVERSITY

PEARSON

Boston

Amsterdam Cape Town Dubai London Madrid Milan Munich Paris Montreal Toronto

Hong Kong

Columbus

Mexico City

Indianapolis

Sao Paulo

New York

Sydney

San Francisco

Seoul

Upper Saddle River

Singapore

Taipei

Delhi

Tokyo

G O N T E N TS

Preface

23

Acknowledgments

27

PART ONE

INTRODUCTION

28

1

Introduction to Human Resource Management

28

WHAT IS HUMAN RESOURCE MANAGEMENT AND WHY IS IT IMPORTANT?

30

What Is Human Resource Management? 30 Why Is Human Resource Management Important to All Managers? 31 Line and Staff Aspects of Human Resource Management 32 Line Managers' Human Resource Duties 33 Human Resource Manager's Duties 33 New Approaches to Organizing HR 35 Cooperative Line and Staff HR Management: An Example 35

THE TRENDS SHAPING HUMAN RESOURCE MANAGEMENT

Globalization and Competition Trends 37 Indebtedness ("Leverage") and Deregulation Technological Trends 38 Trends in the Nature of Work 39

38

• HR AS A PROFIT CENTER: Boosting Customer Service

Workforce and Demographic Trends

Economic Challenges and Trends

42

40

THE NEW HUMAN RESOURCE MANAGERS

43

40

36

Human Resource Management Yesterday and Today 43 They Focus More on Strategic, Big Picture Issues 43

• THE STRATEGIC CONTEXT: Building LL.Bean

43

They Use New Ways t o Provide Transactional Services

They Take an Integrated, "Talent Management" Approach to Managing Human Resources 45 They Manage Ethics 45 They Manage Employee Engagement 45 They Measure HR Performance and Results 45 They Use Evidence-Based Human Resource Management 46 They Add Value 46 They Have New Competencies 47 HR Certification 48

44

THE PLAN OF THIS BOOK

48

The Basic Themes and Features

CHAPTER CONTENTS OVERVIEW

48

49

Part 1: Introduction 49

Part 2: Recruitment, Placement, and Talent Management 49

Part 3: Training and Development

49

Part 4: Compensation 49 Part 5: Employee Relations 49 The Topics Are Interrelated 50 CHAPTER SECTION SUMMARIES 51 DISCUSSION QUESTIONS 51 INDIVIDUAL AND GROUP ACTIVITIES

52

EXPERIENTIAL EXERCISE: HELPING "THE DONALD" 52 APPLICATION CASE: JACK NELSON'S PROBLEM 53 CONTINUING CASE: CARTER CLEANING COMPANY 53 KEY TERMS 54 ENDNOTES 54

8

CONTENTS

2 Equal Opportunity and the Law

56

EQUAL EMPLOYMENT OPPORTUNITY 1964-1991 58 Title VII of the 1964 Civil Rights Act 58 Executive Orders 58 Equal Pay Ac t o f 1963 59 Age Discrimination in Employment Act of 1967 59 Vocational Rehabilitation Act of 1973 59 Pregnancy Discrimination Act of 1978 60 Federal Agency Guidelines 60 Early Court Decisions Regarding Equal Employment Opportunity 60 EQUAL EMPLOYMENT OPPORTUNITY 1990-91-PRESENT 61 The Civil Rights Act of 1991 61 The Americans with Disabilities Act 62 Genetic Information Nondiscrimination Act of 2008 (GINA) 65 State and Local Equal Employment Opportunity Laws 65 Sexual Harassment 65 DEFENSES AGAINST DISCRIMINATION ALLEGATIONS 69 The Central Role of Adverse Impact 70 Bona Fide Occupational Qualification 72 Business Necessity 73 Other Considerations in Discriminatory Practice Defenses 74 ILLUSTRATIVE DISCRIMINATORY EMPLOYMENT PRACTICES 74 A Note on What You Can and Cannot Do 74 Recruitment 75 Selection Standards 75 Sample Discriminatory Promotion, Transfer, and Layoff Practices 76 What the Supervisor Should Keep in Mind 77 THE EEOC ENFORCEMENT PROCESS 77 Voluntary Mediation 79 Mandatory Arbitration of Discrimination Claims 80 DIVERSITY MANAGEMENT AND AFFIRMATIVE ACTION PROGRAMS 81 Diversity's Potential Pros and Cons 81

• HR AS A PROFIT CENTER

Managing Diversity 82 Encouraging Inclusiveness 83 Developing a Multicultural Consciousness 84 Equal Employment Opportunity Versus Affirmative Action 85 Implementing the Affirmative Action Program 85 Reverse Discrimination 86 CHAPTER SECTION SUMMARIES 87 DISCUSSION QUESTIONS 88 INDIVIDUAL AND GROUP ACTIVITIES 88 EXPERIENTIAL EXERCISE: "SPACE CADET" OR VICTIM? 89

APPLICATION CASE: THE EMIRATISATION HRM PRACTICES OF A PETROLEUM COMPANY 89 CONTINUING CASE: CARTER CLEANING COMPANY 90

82

91

ENDNOTES 91

KEY TERMS

Human Resource Management Strategy and Analysis

THE STRATEGIC MANAGEMENT PROCESS

• THE STRATEGIC CONTEXT : The Shanghai Portman Hotel

98

98

96

Goal-Setting and the Planning Process 98 Strategic Planning 99 Improving Productivity Through HRIS: Using Computerized Business Planning Software 102 Types of Strategies 102 Top Managers' Role in Strategic Planning 104

CONTENTS

9

Departmental Managers' Strategic Planning Roles 104

Departmental Managers' Strategic Planning Roles in Action: Improving Mergers and

Acquisitions

105

STRATEGIC HUMAN RESOURCE MANAGEMENT

106

Defining Strategic Human Resource Management 106 Human Resource Strategies and Policies 108

• HR AS A PROFIT CENTER: Albertsons Example

108

Strategic Human Resource Management Tools 108

HR METRICS AND BENCHMARKING

110

Types of Metrics

Improving Productivity Through HRIS: Tracking Applicant Metrics for Improved Talent Management 111 Benchmarking in Action 112 Strategy and Strategy-Based Metrics 113

Workforce/Talent Analytics and Data Mining

111

113

• HR AS A PROFIT CENTER: Using Workforce/Talent Analytics

114

What Are HR Audits? 115

Evidence-Based HR and the Scientific Way of Doing Things 116

WHAT ARE HIGH-PERFORMANCE WORK SYSTEMS?

High-Performance Human Resource Policies and Practices 118 CHAPTER SECTION SUMMARIES 119 DISCUSSION QUESTIONS 120 INDIVIDUAL AND GROUP ACTIVITIES 120

117

EXPERIENTIAL EXERCISE:

DEVELOPING A N HR

STRATEGY FOR STARBUCKS

121

APPLICATION CASE: SIEMENS BUILDS A STRATEGY-ORIENTED HR SYSTEM

121

CONTINUING CASE: CARTER CLEANING COMPANY

TRANSLATING STRATEGY INTO HR POLICIES & PRACTICES CASE: THE HOTEL PARIS CASE

KEY TERMS

ENDNOTES 125 PART 1 VIDEO CASES APPENDIX 126

122

124

122

PART TWO

RECRUITMENT, PLACEMENT, AND TALENT MANAGEMENT 128

4

Jo b Analysis an d th e Talent Managemen t Process

128

THE TALENT MANAGEMENT PROCESS

What Is Talent Management? THE BASICS OF JOB ANALYSIS Uses of Job Analysis Information

• TH E STRATEGIC CONTEXT : Daimler Alabama Example

130

130

131

132

133

Conducting a Job Analysis 133

• HR AS A PROFIT CENTER: Boosting Productivity through Work Redesign

Job Analysis Guidelines 136 METHODS FOR COLLECTING JOB ANALYSIS INFORMATION The Interview 136 Questionnaires 139 Observation 140 Participant Diary/Logs 140 Quantitative Job Analysis Techniques 140 Internet-Based Job Analysis 142

136

WRITING JOB DESCRIPTIONS

144

Job Identification

Job Summary

145

144

Relationships 147 Responsibilities and Duties

147

134

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CONTENTS

D MANAGIN G THE NEW WORKFORCE: Writing Job Descriptions That Comply

with the ADA

Standards of Performance and Working Conditions 148 Duty: Accurately Posting Accounts Payable 148 Using the Internet for Writing Job Descriptions 148 WRITING JOB SPECIFICATIONS 152 Specifications for Trained Versus Untrained Personnel 152 Specifications Based on Judgment 152 Job Specifications Based on Statistical Analysis 153 Using Task Statements 153 PROFILES IN TALENT MANAGEMENT 154 Competencies and Competency-Based Job Analysis 154 How to Write Job Competencies-Based Job Descriptions 156 CHAPTER SECTION SUMMARIES 157 DISCUSSION QUESTIONS 158 INDIVIDUAL AND GROUP ACTIVITIES 158

EXPERIENTIAL EXERCISE: THE INSTRUCTOR'S JOB DESCRIPTION 158 APPLICATION CASE: RECRUITING IN EUROPE 159 CONTINUING CASE: CARTER CLEANING COMPANY 159 TRANSLATING STRATEGY INTO HR POLICIES & PRACTICES CASE: THE HOTEL PARIS CASE 160

148

KEY TERMS

ENDNOTES 160

16 0

Personnel Planning and Recruiting

162

INTRODUCTION

164

WORKFORCE PLANNING

AN D FORECASTING

164

Strategy and Workforce Planning

165

Forecasting Personnel Needs (Labor Demand) 165 Improving Productivity Through HRIS: Computerized Personnel Forecasting 168 Forecasting the Supply of Inside Candidates 168 Forecasting the Supply of Outside Candidates 170 Talent Management and Predictive Workforce Monitoring 170

Developing an Action Plan to Match Projected Labor Supply and Labor Demand 171 The Recruiting Yield Pyramid 171

164

• THE STRATEGIC CONTEXT: KPMG

THE NEED FOR EFFECTIVE RECRUITING Why Recruiting Is Important 172 What Makes Recruiting a Challenge? 172 Organizing How You Recruit 172 INTERNAL SOURCES OF CANDIDATES

Using Internal Sources: Pros and Cons 173 Finding Internal Candidates 173 Rehiring 173 Succession Planning 174 Improving Productivity Through HRIS: Succession and Talent Planning Systems 174 OUTSIDE SOURCES OF CANDIDATES 175 Recruiting via the Internet 175 Advertising 178 Employment Agencies 180 Temp Agencies and Alternative Staffing 181

172

173

Offshoring and Outsourcing Jobs 183 Executive Recruiters 183 On-Demand Recruiting Services 184 College Recruiting 184 Referrals and Walk-Ins 185 Telecommuters 186 Military Personnel 186

CONTENTS

11

Recruiting Source Use and Effectiveness

Evidence-Based HR: Measuring Recruiting Effectiveness

186

187

• HR AS A PROFIT CENTER: Personnel Planning and Recruiting

188

Improving Productivity Through HRIS: An Integrated Approach to Recruiting 188

RECRUITING A MORE DIVERSE WORKFORCE

188

Single Parents 188

Older Workers 189 Recruiting Minorities 189 Welfare-to-Work 190

The Disabled

190

DEVELOPING AND USING APPLICATION FORMS

Purpose of Application Forms 190 Application Guidelines 192 Application Forms and EEO Law 192 Using Application Forms to Predict Job Performance 193 Mandatory Arbitration 193 CHAPTER SECTION SUMMARIES 193 DISCUSSION QUESTIONS 194 INDIVIDUAL AND GROUP ACTIVITIES 194 EXPERIENTIAL EXERCISE: THE NURSING SHORTAGE 195 APPLICATION CASE: YA KUN KAYA TOAST 195

CONTINUING CASE: CARTER CLEANING COMPANY 196 TRANSLATING STRATEGY INTO HR POLICIES & PRACTICES CASE: THE HOTEL PARIS CASE 196

190

KEY TERMS

ENDNOTES 197

197

6 Employee Testing and Selection

WHY CAREFUL SELECTION IS IMPORTANT

Person and Job/Organization Fit

202

200

202

• THE STRATEGIC CONTEXT: Crowd Sourcing at Google

BASIC TESTING CONCEPTS

203

Reliability

203

Validity

Evidence-Based HR: How to Validate a Test 206

Bias

Utility Analysis

204

208

208

• HR AS A PROFIT CENTER: Reducing

Turnover at Key Bank

202

209

Validity Generalization 209 Test Takers' Individual Rights and Test Security 209 How Do Employers Use Tests at Work? 210 Computerized and Online Testing 211

TYPES OF TESTS

212

Tests of Cognitive Abilities 212

Tests of Motor and Physical Abilities 213

Measuring Personality and Interests Achievement Tests 216

213

WORK SAMPLES AND SIMULATIONS

216

Using Work Sampling for Employee Selection 216 Situational Judgment Tests 217 Management Assessment Centers 217 Situational Testing and Video-Based Situational Testing 218 Computerized Multimedia Candidate Assessment Tools 218 The Miniature Job Training and Evaluation Approach 219 Realistic Job Previews 219 HR in Practice: Testing Techniques for Managers 219 Summary 220

12

CONTENTS

BACKGROUND INVESTIGATIONS AND OTHER SELECTION METHODS

220

Why Perform Background Investigations and Reference Checks? 220 The Legal Dangers and How to Avoid Them 221

How to Check a Candidate's Background 222 The Social Network: Checking Applicants' Social Postings 224 Using Preemployment Information Services 225 The Polygraph and Honesty Testing 225 Graphology 227 "Human Lie Detectors" 227 Physical Exams 227 Substance Abuse Screening 228 Complying with Immigration Law 229 Improving Productivity Through HRIS: Using Automated Applicant Tracking and Screening Systems 230

CHAPTER SECTION SUMMARIES

DISCUSSION QUESTIONS

INDIVIDUAL AND GROUP ACTIVITIES

EXPERIENTIAL EXERCISE: A TEST FOR A RESERVATION CLERK 232 APPLICATION CASE: KPMG 232

CONTINUING CASE: HONESTY TESTING AT CARTER CLEANING COMPANY 233 TRANSLATING STRATEGY INTO HR POLICIES & PRACTICES CASE: THE HOTEL PARIS CASE 233

230

231

231

KEY TERMS

ENDNOTES 234

234

7 Interviewing Candidates

238

BASIC TYPES OF INTERVIEWS

240

• THE STRATEGIC CONTEXT: Whirlpool Corp.

240

Structured Versus Unstructured Interviews

Interview Content (What Types of Questions to Ask)

How Should We Administer the Interview?

240

244

241

• HR AS A PROFIT CENTER: Great Western Bank

246

Three Ways to Make the Interview Usefulness 247

THE ERRORS THAT UNDERMINE AN INTERVIEW'S USEFULNESS

247

First Impressions (Snap Judgments) 248 Not Clarifying What the Job Requires 248 Candidate-Order (Contrast) Error and Pressure to Hire 248 Nonverbal Behavior and Impression Management 249 Effect of Personal Characteristics: Attractiveness, Gender, Race 249

• MANAGIN G THE

Interview

250

NEW WORKFORCE: Applicant Disability and the Employment

Interviewer Behavior

250

HOW TO DESIGN AND CONDUCT AN EFFECTIVE INTERVIEW

Designing a Structured Situational Interview

251

How to Conduct an Effective Interview

Talent Management: Profiles and Employee Interviews

252

255

251

CHAPTER SECTION SUMMARIES 255 DISCUSSION QUESTIONS 256 INDIVIDUAL AND GROUP ACTIVITIES 256 EXPERIENTIAL EXERCISE: THE MOST IMPORTANT PERSON YOU'LL EVER HIRE 257 APPLICATION CASE: NURSE RECRUITMENT AT GULF HOSPITAL 257 CONTINUING CASE: CARTER CLEANING COMPANY 258

TRANSLATING STRATEGY INTO HR POLICIES & PRACTICES CASE: THE HOTEL PARIS CASE 258 KEY TERMS 259 ENDNOTES 259 APPENDIX 1 FOR CHAPTER 7 APPLICANT INTERVIEW GUIDE 262 APPENDIX 2 FOR CHAPTER 7 INTERVIEW GUIDE FOR INTERVIEWEES 264

PART 2 VIDEO CASES APPENDIX

266

CONTENTS

13

PART THREE

TRAINING AND DEVELOPMENT

268

8

Training and Developing Employees

268

ORIENTING AND ONBOARDING NEW EMPLOYEES 270 The Purposes of Employee Orientation/Onboarding 270 The Orientation Process 270 OVERVIEW OF THE TRAINING PROCESS 272 Aligning Strategy and Training 272

• THE STRATEGIC CONTEXT: CapitaLand 272

Training and Performance 273 The ADDIE Five-Step Training Process 273

Conducting the Training Needs Analysis 273 Designing the Training Program 276 Developing the Program 279

IMPLEMENTING TRAINING PROGRAMS

279

On-the-Job Training 279 Apprenticeship Training 281 Informal Learning 281 Job Instruction Training 281 Lectures 282 Programmed Learning 282 Audiovisual-Based Training 283 Vestibule Training 283 Electronic Performance Support Systems (EPSS) 283 Videoconferencing 284 Computer-Based Training (CBT) 284 Simulated Learning 284 Interactive Learning 285 Internet-Based Training 285 Improving Productivity Through HRIS: Learning Management Systems 286 Mobile Learning 286 The Virtual Classroom 287

Lifelong and Literacy Training Techniques 287

• MANAGIN G TH E NE W WORKFORCE : Diversity Training 288

Team Training 288 IMPLEMENTING MANAGEMENT DEVELOPMENT PROGRAMS 289 Strategy and Development 289 Managerial On-the-Job Training 289 Off-the-Job Management Training and Development Techniques 290 Leadership Development at GE 292 Talent Management and Mission-Critical Employees: Differential Development Assignments 293 MANAGING ORGANIZATIONAL CHANGE PROGRAMS 294 What to Change 294 Lewin's Change Process 295 Leading Organizational Change 295 Using Organizational Development 296 EVALUATING THE TRAINING EFFORT 298 Designing the Study 298 Training Effects to Measure 299

• HR AS A PROFIT CENTER: Judging Training's Impact

CHAPTER SECTION SUMMARIES 301

300

DISCUSSION QUESTIONS 301 INDIVIDUAL AND GROUP ACTIVITIES 302

EXPERIENTIAL EXERCISE: FLYING THE FRIENDLIER SKIES 302

APPLICATION CASE: THE MENTORSHIP PROGRAM AT TVH CONTINUING CASE: CARTER CLEANING COMPANY 303

303

1 4

CONTENTS

TRANSLATING STRATEGY INTO HR POLICIES & PRACTICES CASE: THE HOTEL PARIS CASE

KEY TERMS

30 4

ENDNOTES

304

304

9

Performance Management and Appraisal

308

BASIC CONCEPTS IN PERFORMANCE MANAGEMENT AND APPRAISAL

310

 

The Performance Appraisal Process

310

Why Appraise Performance?

311

• HR AS A PROFIT CENTER: Setting Performance Goals at Ball Corporation

312

 

The Importance of Continual Feedback

312

 

Performance Management

312

• TH E STRATEGI C CONTEXT : TRW

31 3

Defining the Employee's Goals and Performance Standards 313 Who Should Do the Appraising? 314 TECHNIQUES FOR APPRAISING PERFORMANCE 316 Graphic Rating Scale Method 316 Alternation Ranking Method 320

 
 

Paired Comparison Method

320

Forced Distribution Method

320

Critical Incident Method 321 Narrative Forms 322 Behaviorally Anchored Rating Scales 322 Mixed Standard Scales 325 Management by Objectives 326 Computerized and Web-Based Performance Appraisal 326 Electronic Performance Monitoring 327 Appraisal in Practice 327 DEALING WITH APPRAISAL PROBLEMS AND INTERVIEWS 328 Potential Appraisal Problems 329 Guidelines for Effective Appraisals 330 Appraisals and th e Law 332 Managing the Appraisal Interview 332 PERFORMANCE MANAGEMENT 335 Performance Management vs. Performance Appraisal 335 Using Information Technology to Support Performance Management 336 TALENT MANAGEMENT PRACTICES AND EMPLOYEE APPRAISAL 337 Appraising and Actively Managing Employees 337 ' Segmenting and Actively Managing Employees in Practice 337 CHAPTER SECTION SUMMARIES 338 DISCUSSION QUESTIONS 339 INDIVIDUAL AND GROUP ACTIVITIES 339 EXPERIENTIAL EXERCISE: GRADING THE PROFESSOR 340 APPLICATION CASE: APPRAISING THE SECRETARIES AT SWEETWATER U 340 CONTINUING CASE: CARTER CLEANING COMPANY 341 TRANSLATING STRATEGY INTO HR POLICIES & PRACTICES CASE: THE HOTEL PARIS CASE 342 KEY TERMS 34 2 ENDNOTES 342

1 0

Employee Retention, Engagement, and Careers

346

 

MANAGING EMPLOYEE TURNOVER AND RETENTION

Costs of Turnover

348

• HR AS A PROFIT CENTER

348

Managing Voluntary Turnover

348

348

Retention Strategies for Reducing Voluntary Turnover

349

A Comprehensive Approach to Retaining Employees

350

• TH E STRATEGIC CONTEXT : IBM Aims for Flexibility

Managing Involuntary Turnover 351

35 0

CONTENTS

15

PART FOUR

1

1

Talent Management and Employee Retention 351 Job Withdrawal 351

EMPLOYEE ENGAGEMENT

352

Why Engagement Is Important 352

Actions That Foster Engagement 352

Monitoring Employee Engagement

CAREER MANAGEMENT

353

352

Careers Terminology 353 Careers Today 354 Psychological Contract 354 The Employee's Role in Career Management 354 The Employer's Role in Career Management 356 Career Management Systems 356 Gender Issues in Career Development 358 The Manager's Role 359

IMPROVING COACHING SKILLS

359

Building Your Coaching Skills

359

Building Your Mentoring Skills

360

Improving Productivity Through HRIS: Integrating Talent Management and Career

and Succession Planning

362

MAKING PROMOTION DECISIONS

363

Decision 1: Is Seniority or Competence the Rule? 363

Decision 2: How Should We Measure Competence?

Decision 3: Is the Process Formal or Informal? 364 Decision 4: Vertical, Horizontal, or Other? 364 Practical Considerations 364 Sources of Bias in Promotion Decisions 364 Promotions and the Law 365 Managing Transfers 365

363

^Managing Retirements

366

CHAPTER SECTION SUMMARIES 367 DISCUSSION QUESTIONS 367 INDIVIDUAL AND GROUP ACTIVITIES 368 EXPERIENTIAL EXERCISE: WHERE AM I GOING

APPLICATION CASE: GOELECTRIX 369 CONTINUING CASE: CARTER CLEANING COMPANY 369

TRANSLATING STRATEGY INTO HR POLICIES & PRACTICES CASE: THE HOTEL PARIS CASE 369

KEY TERMS

AND WHY? 368

370

ENDNOTES 370 PART 3 VIDEO CASES APPENDIX 373

COMPENSATION

376

Establishing Strategic Pay Plans

376

BASIC FACTORS I N DETERMININ G PAY RATES

Aligning Total Rewards with Strategy

378

378

THE STRATEGIC CONTEXT: Wegmans Foods

378

Equity and Its Impact on Pay Rates 379 Legal Considerations in Compensation 380

D

MANAGIN G TH E NE W WORKFORCE : The Independent Contractor

381

Union Influences on Compensation Decisions

384

Pay Policies

384

HR AS A PROFIT CENTER: Wegmans Foods

385

JOB EVALUATION METHODS

385

Compensable Factors 386 Preparing for the Job Evaluation 386

1 6

CONTENTS

Job Evaluation Methods: Ranking 387 Job Evaluation Methods: Job Classification 388 Job Evaluation Methods: Point Method 389 Computerized Job Evaluations 389

HOW TO CREATE A MARKET-COMPETITIVE PAY PLAN

1. Choose Benchmark Jobs 390

390

2. Select Compensable Factors 390

3. Assign Weights to Compensable Factors 391

4. Convert Percentages to Points for Each Factor 391

5. Define Each Factor's Degrees 392

6. Determine for Each Job Its Factors' Degrees and Assign Points 392

7. Review Job Descriptions and Job Specifications 392

8. Evaluate the Jobs 393

9. Draw the Current (Internal) Wage Curve 393

10. Conduct a Market Analysis: Salary Surveys 394

11. Draw the Market (External) Wage Curve 396

12. Compare and Adjust Current and Market Wage Rates for Jobs 396

13. Develop Pay Grades 397

14. Establish Rate Ranges 397

15. Address Remaining Jobs 399

16. Correct Out-of-Line Rates 399

PRICING MANAGERIAL AND PROFESSIONAL JOBS

Compensating Executives and Managers

What Determines Executive Pay?

Compensating Professional Employees

400

400

401

CONTEMPORARY TOPICS IN COMPENSATION

402

400

Competency-Based Pay 402 Broadbanding 404 Actively Managing Compensation Allocations and Talent Management

406

Comparable Worth 406 Board Oversight of Executive Pay 407 Total Rewards and Tomorrow's Pay Programs 407 Improving Productivity Through HRIS: Automating Strategic Compensation Administration 408 CHAPTER SECTION SUMMARIES 408 DISCUSSION QUESTIONS 409 INDIVIDUAL AND GROUP ACTIVITIES 409 EXPERIENTIAL EXERCISE: RANKING THE COLLEGE'S ADMINISTRATORS

410

APPLICATION CASE: GATES SOLUTIONS 410 CONTINUING CASE: CARTER CLEANING COMPANY 411 TRANSLATING STRATEGY INTO HR POLICIES & PRACTICES CASE: THE HOTEL PARIS CASE 411 KEY TERMS 412 ENDNOTES 412

1 2

Pay for Performance and Financial Incentives

MONEY AND MOTIVATION

418

Linking Strategy, Performance, and Incentive Pay

418

• TH E STRATEGIC CONTEXT : The Car Sales Commission

418

416

Motivation and Incentives 419 Incentive Pay Terminology 421 Employee Incentives and the Law 421

INDIVIDUAL EMPLOYEE INCENTIVE AND RECOGNITION PROGRAMS

422

Piecework Plans 422 Merit Pay as an Incentive 422 Incentives for Professional Employees 424 Nonfinancial and Recognition-Based Awards 424 Online and IT-Supported Awards 426 Job Design 426

CONTENTS

17

INCENTIVES FOR SALESPEOPLE

Salary Plan 427 Commission Plan 427 Combination Plan 427 Maximizing Sales Force Results 428 Evidence-Based HR: How Effective Are Your Incentives? 428 INCENTIVES FOR MANAGERS AN D EXECUTIVES 429

Strategy and the Executive's Long-Term and Total Rewards Package 429 Sarbanes-Oxley 430 Short-Term Incentives and the Annual Bonus 430 Strategic Long-Term Incentives 432 Other Executive Incentives 433 TEAM AND ORGANIZATION WIDE INCENTIVE PLANS 433 How to Design Team Incentives 433

426

Evidence-Based HR: How Effective Are Your Incentives?

43 4

Profit-Sharing Plans 435 Scanlon Plans 435 Other Gainsharing Plans 436 At-Risk Pay Plans 43 6 Employee Stock Ownership Plans 437 DESIGNING EFFECTIVE INCENTIVE PROGRAMS

• HR AS A PROFIT CENTER: The Impact of Financial and Nonfinancial Incentives

437

The Five Building Blocks of Effective Incentive Plans

Incentive Plans in Practice: Nucor

439

438

438

CHAPTER SECTION SUMMARIES 439 DISCUSSION QUESTIONS 440 INDIVIDUAL AND GROUP ACTIVITIES 440 EXPERIENTIAL EXERCISE: MOTIVATING THE SALES FORCE AT EXPRESS AUTO 441 APPLICATION CASE: GYC FINANCIAL ADVISORY PTE. LTD. 441 CONTINUING CASE: CARTER CLEANING COMPANY 442

TRANSLATING STRATEGY INTO HR POLICIES & PRACTICES CASE: THE HOTEL PARIS CASE 443

HNfi^fc^Bia*k

1 3

44 3

ENDNOTES 444

KEY TERMS

Benefits and Services

448

THE BENEFITS PICTURE TODAY

450

Policy Issues

450

• TH E STRATEGIC CONTEXT : NES Rentals

PAY FOR TIM E NO T WORKE D

451

45 1

Unemployment Insurance 451 Vacations and Holidays 453 Sick Leave 453 Evidence-Based HR: Tracking Sick Leave 454

• HR A S A PROFIT CENTER: Cutting Absences at the Driver and Vehicle Licensing Agency

45 4

Parental Leave and the Family and Medical Leave Act 455 Severance Pay 457 Supplemental Unemployment Benefits 458

INSURANCE BENEFITS

458

Workers' Compensation 458 Hospitalization, Health, and Disability Insurance 459 The Legal Side of Health Benefits 460

Trends in Employer Health Care Cost Control 461 Long-Term Care 463 Life Insurance 464

Benefits for Part-Time and Contingent Workers 464

464

RETIREMENT BENEFITS Social Security 464

18

CONTENTS

Pension Plans 464 Pension Planning and the Law 467 Pensions and Early Retirement 468

Improving Productivity Through HRIS: Online Benefits Management Systems 468

PERSONAL SERVICES AN D FAMILY-FRIENDLY BENEFITS

Personal Services 469 Family-Friendly (Work-Life) Benefits 469 Other Job-Related Benefits 471 Executive Perquisites 471 FLEXIBLE BENEFITS PROGRAMS 472

The Cafeteria Approach

472

469

Benefits and Employee Leasing 473 Flexible Work Schedules 474 CHAPTER SECTION SUMMARIES 475 DISCUSSION QUESTIONS 476 INDIVIDUAL AND GROUP ACTIVITIES 476

EXPERIENTIAL EXERCISE: REVISING THE BENEFITS PACKAGE 476 APPLICATION CASE: STRIKING FOR BENEFITS 47 7 CONTINUING CASE: CARTER CLEANING COMPANY 477

TRANSLATING STRATEGY INTO HR POLICIES & PRACTICES CASE: THE HOTEL PARIS CASE

KEY TERMS

ENDNOTES 479 PART 4 VIDEO CASES APPENDIX 482

47 8

478

PART FIVE

EMPLOYEE RELATIONS

484

1 4

Ethics and Employee Rights and Discipline

484

ETHICS AND FAIR TREATMENT AT WORK 486

• THE STRATEGIC CONTEXT: Berkshire Hathaway 486

What Is Ethics? 487 Ethics and th e Law 487 Ethics, Justice, and Fair Treatment 487 Ethics, Public Policy, and Employee Rights 488 WHAT SHAPES ETHICAL BEHAVIOR AT WORK? 489 There's No One Smoking Gun 489 The Person (What Makes Bad Apples?) 490 Outside Forces That Shape Ethical Decisions (Bad Barrels) 490 In Summary: Some Things to Keep in Mind About Ethical Behavior at Work 492 USING HUMAN RESOURCE MANAGEMENT METHODS TO PROMOTE ETHICS AN D FAIR TREATMENT 493 Selection 493 Ethics Training 494 Performance Appraisal 494 Reward and Disciplinary Systems 494 Managing Ethics Compliance 494 MANAGING EMPLOYEE DISCIPLINE AN D PRIVACY 494 Fairness in Disciplining 495 Bullying and Victimization 495 What Causes Unfair Behavior 496 Basics of a Fair and Just Disciplinary Process 497 Employee Privacy 500 Employee Monitoring 500 MANAGING DISMISSALS 502 Termination at Will and Wrongful Discharge 502 Grounds for Dismissal 503 Avoiding Wrongful Discharge Suits 504

1 5

CONTENTS

19

• HR AS A PROFIT CENTER: Wrongful Terminations

Personal Supervisory Liability 506 The Termination Interview 507 Layoffs, Downsizing, and the Plant Closing Law 509 Adjusting to Downsizings and Mergers 511 CHAPTER SECTION SUMMARIES 512 DISCUSSION QUESTIONS 513 INDIVIDUAL AND GROUP ACTIVITIES 513 EXPERIENTIAL EXERCISE: DISCIPLINE OR NOT? 513 APPLICATION CASE: ENRON, ETHICS, AND ORGANIZATIONAL CULTURE 514 CONTINUING CASE: CARTER CLEANING COMPANY 515 TRANSLATING STRATEGY INTO HR POLICIES & PRACTICES CASE: THE HOTEL PARIS CASE 515 KEY TERMS 516 ETHICS QUIZ ANSWERS 516 ENDNOTES 516

505

Labor Relations and Collective Bargaining

THE LABOR MOVEMENT

• THE STRATEGIC CONTEXT: The "Anti-Walmart"

522

Why Do Workers Organize?

What Do Unions Want?

TheAFL-CIOandtheSEIU 524

522

523

UNIONS AND THE LAW

524

522

520

Period of Strong Encouragement: The Norris-LaGuardia (1932) and National Labor Relations (or Wagner) Acts (1935) 525 Period of Modified Encouragement Coupled with Regulation: The Taft-Hartley Act (1947) 527 Unfair Union Labor Practices 527

THE UNION DRIVE AND ELECTION

528

Step 1. Initial Contact 528

Step 2. Obtaining Authorization Cards 530 Step 3. Hold a Hearing 531

Step 4. The Campaign

Step 5. The Election 532 How to Lose an NLRB Election 533

531

'

 

Evidence-Based HR: What to Expect the Union to Do to Win the Election

534

The Supervisor's Role

534

Rules Regarding Literature and Solicitation 535 '

 

Decertification Elections: Ousting the Union

535

THE COLLECTIVE BARGAINING PROCESS

535

 

What Is Collective Bargaining?

535

What Is Good Faith? 536 The Negotiating Team 536

 

-

HR AS A PROFIT CENTER: Costing the Contract

537

 

Bargaining Items 537 Bargaining Hints 537 Impasses, Mediation, and Strikes 538 Improving Productivity Through HRIS: Unions Go High-Tech 542 The Contract Agreement 542

 

DEALING WITH DISPUTES AND GRIEVANCES

543

 

Sources of Grievances

543

The Grievance Procedure

544

 

Guidelines for Handling Grievances

545

 

THE UNION MOVEMENT TODAY AND TOMORROW

546

 

Why Union Membership Is Down

546

An Upswing for Unions?

546

Card Check and Other New Union Tactics

547

High-Performance Work Systems, Employee Participation, and Unions

547

2 0

CONTENTS

1 6

CHAPTER SECTION SUMMARIES 549 DISCUSSION QUESTIONS 550 INDIVIDUAL AND GROUP ACTIVITIES 550 EXPERIENTIAL EXERCISE: THE UNION-ORGANIZING CAMPAIGN AT PIERCE U. 550 APPLICATION CASE: NEGOTIATING WITH THE WRITERS GUILD OF AMERICA 551 CONTINUING CASE: CARTER CLEANING COMPANY 551

TRANSLATING STRATEGY INTO HR POLICIES & PRACTICES CASE: THE HOTEL PARIS CASE 552

KEY TERMS

552

ENDNOTES 553

Employee Safety and Health

556

SAFETY AND THE MANAGER

558

Why Safety Is Important

Management's Role in Safety What Top Management Can Do

558

558

558

• THE STRATEGIC CONTEXT: Deepwater Horizon

558

The Supervisor's Role in Safety

OCCUPATIONAL SAFETY LAW

559

559

OSHA Standards and Record Keeping

Inspections and Citations

Responsibilities and Rights of Employers and Employees

559

561

WHAT CAUSES ACCIDENTS?

565

564

What Causes Unsafe Conditions and Other Work-Related Safety Problems?

What Causes Unsafe Acts? (A Second Basic Cause of Accidents)

566

HOW TO PREVENT ACCIDENTS

566

Reducing Unsafe Conditions

566

565

MANAGING THE NEW WORKFORCE: Protecting Vulnerable Workers

571

Reducing Unsafe Acts

572

Reducing Unsafe Acts through Selection and Placement

572

Reducing Unsafe Acts through Training

572

Q

MANAGIN G THE NE W WORKFORCE : Safety

Training for Hispanic Workers

573

Reducing Unsafe Acts through Motivation: Posters, Incentives, and Positive Reinforcement 573

Reducing Unsafe Acts through Behavior-Based Safety 574 Reducing Unsafe Acts through Employee Participation 574 Reducing Unsafe Acts by Conducting Safety and Health Audits and Inspections 575

 

Controlling Workers' Compensation Costs 576

 

HR AS A PROFIT CENTER: Reducing Workers Compensation Claims

577

WORKPLACE HEALTH HAZARDS: PROBLEMS AND REMEDIES

The Basic Industrial Hygiene Program 578 Asbestos Exposure at Work 578 Infectious Diseases 579 Air Quality 579 Alcoholism and Substance Abuse 579 Stress, Burnout, and Depression 581

Solving Computer-Related Ergonomic Problems 583 Repetitive Motion Disorders 583

Workplace Smoking

584

• HR AS A PROFIT CENTER: Wellness Pays

584

577

Violence at Work 584

Workplace Violence Supervisory Training 586

OCCUPATIONAL SECURITY AND SAFETY

587

Basic Prerequisites for a Crime Prevention Plan 588

Setting Up a Basic Security Program 588

Evacuation Plans 589 Company Security and Employee Privacy 589

CHAPTER SECTION SUMMARIES

DISCUSSION QUESTIONS

590

590

CONTENTS

21

INDIVIDUAL AND GROUP ACTIVITIES 591 EXPERIENTIAL EXERCISE: HOW SAFE IS MY UNIVERSITY? 591 APPLICATION CASE: HEALTH AND SAFETY AT EDMUND CAFE 595 CONTINUING CASE: CARTER CLEANING COMPANY 596

TRANSLATING STRATEGY INTO HR POLICIES & PRACTICES CASE: THE HOTEL PARIS CASE 596

KEY TERMS

ENDNOTES 597

597

1 Managing Global Human Resources

7

602

 
 

The Manager's Global Challenge

604

THE STRATEGIC CONTEXT : Trident Support LLC: Tall, Lean, and Mean

604

 

ADAPTING HUMAN RESOURCE ACTIVITIES TO INTERCOUNTRY

DIFFERENCES

604

Cultural Factors 605 Economic Systems 606 Legal, Political, and Labor Relations Factors 606 Ethics and Codes of Conduct 607 HR Abroad Example: The European Union 607 HR Abroad Example: China 607

 

STAFFING THE GLOBAL ORGANIZATION

608

International Staffing: Home or Local? 608

HR AS A PROFIT CENTER: Reducing Expatriate Costs

609

Offshoring 611

Management Values and International Staffing Policy 611 Selecting Expatriate Managers 612

 

Avoiding Early Expatriate Returns

615

TRAINING AND MAINTAINING EMPLOYEES ABROAD

616

Orienting and Training Employees on International Assignment 616

 

^Appraising Managers Abroad

616

Compensating Managers Abroad 617 Labor Relations Abroad 619 Terrorism, Safety, and Global HR 619 Repatriation: Problems and Solutions 620

 

'

Improving Productivity Through HRIS: Taking the HRIS Global 621

MANAGIN G HR LOCALLY: HO W TO

PUT INTO PRACTICE A GLOBAL HR SYSTEM

621

Developing a More Effective Global HR System 622 Making the Global HR System More Acceptable' 622 Implementing the Global HR System 623 CHAPTER SECTION SUMMARIES 623 DISCUSSION QUESTIONS 624 INDIVIDUAL AND GROUP ACTIVITIES 624 EXPERIENTIAL EXERCISE: A TAXING PROBLEM FOR EXPATRIATE EMPLOYEES—625 APPLICATION CASE: EUROPE—IT'S ALL ABOUT PERSPECTIVES 625 CONTINUING CASE: CARTER CLEANING COMPANY 626 TRANSLATING STRATEGY INTO HR POLICIES & PRACTICES CASE:

THE HOTEL PARIS CASE 626 KEY TERMS 627 ENDNOTES 627

1 Managing Human Resources in Small and Entrepreneurial Firms 630

8

 

THE SMALL BUSINESS CHALLENGE

Why Small Business Is Important

632

632

How Small Business Human Resource Management Is Different

Why HRM Is Important to Small Businesses

633

• THE STRATEGIC CONTEXT: Le Charcutier Aoun

634

632

USING INTERNET AND GOVERNMENT TOOLS TO SUPPORT THE HR EFFORT

634

2 2

CONTENTS

Complying with Employment Laws 634 Employment Planning and Recruiting 637 Employment Selection 637 Employment Training 638 Employment Appraisal and Compensation 639 Employment Safety and Health 640

LEVERAGING SMALL SIZE: FAMILIARITY, FLEXIBILITY, FAIRNESS, INFORMALITY, AND HRM 640

Simple, Informal Employee Selection Procedures 640

A Streamlined Interviewing Process

Work-Sampling Tests

640

642

Flexibility in Training 642 Flexibility in Benefits and Rewards 643

Improved Communications 646

• HR AS A PROFIT CENTER: IHOP

646

Fairness and the Family Business

646

USING PROFESSIONAL EMPLOYER ORGANIZATIONS

How Do PEOs Work?

647

647

Why Use a PEO? Caveats 648

647

MANAGING HR SYSTEMS, PROCEDURES, AND PAPERWORK

Introduction 649 Basic Components of Manual HR Systems 649 Automating Individual HR Tasks 650 Human Resource Information Systems (HRIS) 650 Improved Transaction Processing 651 Online Self-Processing 651 Improved Reporting Capability 651 HR System Integration 651 HRIS Vendors 651 HR and Intranets 651 CHAPTER SECTION SUMMARIES 652 DISCUSSION QUESTIONS 652 INDIVIDUAL AND GROUP ACTIVITIES 653 EXPERIENTIAL EXERCISE: BUILDING AN HRIS 653 APPLICATION CASE: NETFLIX BREAKS THE RULES 653 CONTINUING CASE: CARTER CLEANING COMPANY 654 TRANSLATING STRATEGY INTO HR POLICIES & PRACTICES CASE: THE HOTEL PARIS CASE 654 ENDNOTES 655 PART 5 VIDEO CASES APPENDIX 657

649

APPENDICES

APPENDIX A

PHR and SPHR Knowledg e Base

659

APPENDIX B

Comprehensive Cases 667

Glossary 681 Name and Organization Index 689 Subject Index 704