CHAPTER 15: Human Resource Management & Chapter 3: THE WORLD MARKETPLACE

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CHAPTER 15 Human Resource Management
Chapter 3 THE WORLD MARKETPLACE

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CHAPTER 16 Human Resource Management

• BUILDING A TOP-QUALITY WORKFORCE

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HUMAN RESOURCE MANAGEMENT BRINGING BUSINESS TO
LIFE

• Recruiting world-class talent
• Promoting career development
• Boosting organizational effectiveness

• Human Resource Management maximizing the
  effectiveness of the workforce.

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HUMAN RESOURCE MANAGEMENT CHALLENGES MAJOR
HURDLES

• Older Workers
• Younger Workers
• Women Workers
• Work-Life Balance
• Wage Gap
• Outsourcing
• Lawsuits

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BEST-PAID EXECUTIVES OF PUBLIC COMPANIES DURING
THE PAST DECADE
Wall Street Journal July 27, 2010
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BEST-PAID EXECUTIVES OF PUBLIC COMPANIES DURING
THE PAST DECADE
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HUMAN RESOURCE PLANNING DRAWING THE MAP
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ANALYZING HUMAN ASSETS

• Job Analysis
• What skills does the workforce already have?
• What skills do they need?

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RECRUITMENT FINDING THE RIGHT PEOPLE

• Internal Recruiting transferring or promoting
  employees within the company.
• Boosts Morale
• Proven Track Record
• Lower Recruiting Costs
• External Recruiting looking for employees
  outside the firm.
• Recruiting Resources
• Employment Websites
• Newspaper Ads
• Trade Associations
• Employment Centers
• Colleges/Universities

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SELECTION MAKING THE RIGHT CHOICE
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STRUCTURED INTERVIEW

• Develop a list of questions prior to interview
• Focus questions on behaviors and experiences

Describe a time when you What would you do
if If you realized that a co-worker
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INTERVIEW GAFFES THINGS NOT TO DO

• What five or six adjectives best describe you?
• Really, really, really, really, really cool!
• Were you late because you got lost?
• No. It was such a nice day that I didnt mind
  driving slowly.
• Why should I hire you?
• Because they say you should always hire people
  better than yourself.
• What do you find interesting about this job?
• The money. I dont really care what your
  company does.
• How would you define a problem person?
• Anyone who disagrees with me.

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JOB OFFERS CONTINGENT WORKERS

• It is important for managers to set a
  probationary period with new hires
• Typically 3 to 6 months
• Employees will become permanent if everything
  works out
• Companies with fluctuating employment needs may
  opt to hire contingent workers
• Temporary Full-Time
• Independent Contractors
• On-call Workers

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TRAINING AND DEVELOPMENT HONING THE COMPETITIVE
EDGE

• Increase innovation
• Increase technology adoption
• Increase productivity
• Increase motivation
• Decrease liability

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ORIENTATION

• Effective orientations are the first step in the
  development process
• Introduce employees to the company culture
• Strong orientation programs reduce employee
  turnover

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ON-THE-JOB TRAINING
On-the-Job Training popular and low cost -
employees simply begin working under the
guidance of experienced employees.
Apprenticeships training programs where
beginners serve as an assistant prior to
working.
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OTHER TRAINING OPTIONS

• Off-the-Job Training
• training that takes place away
• from the job setting.
• Companies employ a variety
• of training strategies
• Vestibule Training
• Classroom
• Job Simulations

Computer-Based Training standardized
presentations using video, audio and broadband
technology.
Management Development programs to assist
current and potential executives develop
leadership skills.
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EVALUATION ASSESSING EMPLOYEE PERFORMANCE

• Performance Appraisals
• Formal feedback
• Compare actual to expected results
• May impact compensations, incentives, promotions,
  transfers and terminations
• HR should create an evaluation tool that ties
  into the companys objectives
• Evaluation should be a feedback PROCESS
• Managers should be trained
• Employees should be informed of the process

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COMPENSATION SHOW ME THE MONEY

• Compensation the combination of pay and
  benefits.

• Compensation is based on
• Competition
• Contribution
• Ability to Pay
• Cost of Living
• Legislation

Wages pay in exchange for the number of
hours or days that an employee works.
Salary the pay that employees receive over a
fixed period.
Benefits noncash compensation like health
care and vacation.
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PERFORMANCE PAY OPTIONS
IBM Distinguished EngineerClient Technical
AdvisorMember, IBM Academy of Technology
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BENEFITS FROM BIRTHDAY CAKES TO DEATH BENEFITS
Legally Mandated Benefits
Optional Benefits

• Paid Vacation Holidays
• Paid Sick Days
• Health Insurance
• Retirement Programs
• Product Discounts
• Tuition Reimbursement

• Social Security
• Medicare Contributions
• Unemployment Payments
• Workers Compensation
• Federal Family and Medical Leave

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CAFETERIA-STYLE BENEFITS

• Providing employees a set dollar amount per
  person that they spend on company benefits.
• Allows employees to tailor their benefits to
  their individual needs.

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EMPLOYEE HEALTH AND WELLNESS PROGRAMS

According to the World Health Organization, every
dollar spent on wellness programs saves three
dollars in medical costs. Workplace fitness
programs reduce short-term leave by up to 32 and
increase productivity by up to 52.

(Source Share the bottom-line benefits by Sid
Kirchheimer, Time magazine, February 14, 2004)
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FLEXIBLE SCHEDULING
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SEPARATION BREAKING UP IS HARD TO DO

• Employees will leave for a variety of reasons
• Fired
• Laid Off
• Transfers
• Career Changes
• Personal Reasons
• Employers should proceed carefully to avoid
  wrongful termination lawsuits

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TITLE VII CIVIL RIGHTS ACT OF 1964

• Prohibits discrimination in hiring, firing,
  compensation or privileges of employment based on
  race, color, religion, sex or national origin
• Supplemented with legislation to cover age,
  disability and pregnancy
• Title VII created the Equal Employment
  Opportunity Commission (EEOC)

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LEGAL ISSUES HR AND THE LONG ARM OF THE LAW
Immigration Reform and Control Act of 1986
Fair Labor Standards Act of 1938
Americans with Disabilities Act of 1990
Equal Pay Act of 1963
Occupational Safety and Health Act of 1970
Family and Medical Leave Act of 1996
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Chapter 3 THE WORLD MARKETPLACE

• Business without Borders

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With technology and telecommunications booming,
and trade barriers falling, the economic
boundaries between nations have begun to blur.
AN UNPRECEDENTED OPPORTUNITY
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WORLDWIDE ECONOMIC GROWTH
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BRIC countries- Brazil, Russia, India and China
The four original BRIC countries comprise more
than 2.8 billion people or 40 percent of the
worlds population, cover more than a quarter of
the worlds land area over three continents, and
account for more than 25 percent of global GDP.
Recent forecast of the world ranking of the
biggest economies in the year 2050
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KEY REASONS FOR INTERNATIONAL TRADE

• Access to Factors of Production
• Reduced Economic Risk
• Innovation

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COMPETITIVE ADVANTAGE
Opportunity cost The cost of giving up the
second-best choice when making a decision.
A country has an absolute advantage when it can
produce more of a good than other nations,
using the same amount of resources.
Comparative advantage - the benefit a country has
in a given industry if it can make products at
a lower opportunity Cost.
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GLOBAL TRADE TAKING MEASURE

• Balance of Trade
• Trade Deficit
• Trade Surplus
• Balance of Payments
• Balance of Payments Deficit
• Balance of Payments Surplus
• Exchange Rates
• Countertrade

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United States Balance of Trade
The balance of trade is the difference between
the monetary value of exports and imports in an
economy over a certain period of time. A positive
balance of trade is known as a trade surplus and
consists of exporting more than is imported a
negative balance of trade is known as a trade
deficit or, informally, a trade gap.
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U.S. Balance of Payments (International
Transactions)
Current Account Balance 1st quarter 2009
-101.5 billion 4th quarter 2008 -154.9
billion 3rd quarter 2008 -174.1 billion 2nd
quarter 2008 -180.9 billion 1st quarter 2008
-175.6 billion
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EXCHANGE RATES WHO BENEFITS?
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American Dollar Exchange Rate
in USD
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GLOBAL MARKET DEVELOPMENT OPTIONS
Lower Risk
Higher Risk
Direct Investment
Exporting
Licensing
Franchising
Less Control
More Control
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STRATEGIES FOR FINDING GLOBAL SUPPLIERS
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STRATEGIES FOR REACHING GLOBAL MARKETS

• Licensing
• Authority given by domestic firm for rights to
  produce/market its product and use
  trademarks/patents.
• Franchising
• Providing the right to produce and market
  products under its operating requirements.
• Direct Investment
• Firms acquire businesses or develop new
  facilities in foreign countries.
• Joint Ventures
• Two or more companies joining forces to pursue
  specific opportunities (Partnership or Strategic
  Alliances

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MULTINATIONAL FIRMS
Do you know where the firm that ultimately owns
each brand is headquartered?
Nestle Quick
Switzerland
Nokia Cell Phones
Finland
Jaguar Automobiles
India
Michelin Tires
France
Shell Oil
Netherlands/England
Columbia Records
Japan/Germany
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BARRIERS TO INTERNATIONAL TRADE

• Sociocultural Differences
• Economic Differences
• Political Legal Differences

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SOCIAL/CULTURAL DIFFERENCES
Think beyond the obvious differences.
Social/cultural differences can rapidly
undermine business relationships.

• Nonverbal Communication
• Forms of Address
• Attitudes toward punctuality
• Religious Celebrations
• Business Practice/Gifts

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OOPS TRANSLATION GAFFS

• It takes a virile man to make a chicken
  affectionate
• Perdue Farms slogan It takes a tough man to make
  a chicken tender translation in Mexico.
• Irish Manure Liquor / Silver Dung Rolls Royce?
• Several foreign companies have introduced
  products in Germany with the word mist which
  roughly translates into dung or manure
• Nothing sucks like an Electrolux
• Electrolux, a Swedish maker vacuum cleaners,
  introduced their vacuums in the U.S. with a
  literal translation of their slogan.
• Come Alive
• Pepsis campaign in China failed because its
  message came across as Pepsi brings your
  ancestors back from their graves.

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ECONOMIC DIFFERENCES

• Exchange Rates
• Population
• Per Capita Income
• Infrastructure
• Transportation
• Communication
• Energy
• Finance

Can you profitably provide your product or
service to meet the needs of the market?
Can you profitably provide your product or
service to meet the needs of the market?
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POLITICAL LEGAL DIFFERENCES

• Political regimes differ around the world
• Legal Differences
• Lack of Enforcement
• Bribery
• Political Climate
• Stability
• Violence
• Piracy and intellectual property is a problem in
  several foreign nations

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PROTECTIONISM
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TRADE RESTRICTIONS

• Tariffs
• Taxes levied against imports
• Quotas
• Limitations on the amount of specific products
  that may be imported from certain countries
• Voluntary Export Restrictions
• Limitations on the amount of specific products
  that one nation will export to another
• Embargo
• Total ban on international trade of a certain
  item or a total halt in trade with a specific
  nation

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GLOBAL EMPLOYMENT

A new study suggests that 2.3 million service
jobs will have moved from the United States to
other countries by 2008, up from 900,000 as of
2003.

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REVERSE BRAIN DRAIN

• Many talented immigrants are moving home to take
  advantage of new economic opportunities.
• US companies can cut costs by sourcing employees
  from overseas.
• But is America losing potential innovators such
  as Sergey Brin, founder of Google?

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FREE TRADE THE MOVEMENT GAINS MOMENTUM

• There has been a global move toward free trade
  the unrestricted movement of good and services
  across borders.

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GATT AND WORLD TRADE ORGANIZATION (WTO)

• General Agreement on Tariffs Trade (GATT)
• Established in 1948
• Now encompasses 125 nations
• Slashed tariffs by about 30
• Promote International Trade
• Settle Trade Disputes

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FREE TRADE

• The World Bank
• 185 Member Countries
• Reduce World Poverty in Developing World
• Influence Global Economy
• Provide Financial Assistance
• Low interest loans
• The International Monetary Fund
• Support Stable Exchange Rates
• Facilitate International Payments
• Adopt Economic Policies
• Promote Trade
• Lend money to member nations

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TRADING BLOCS/COMMON MARKETS
Groups of Countries promoting the free flow of
goods and services

• The North American Free Trade Agreement (NAFTA)
• The largest trading bloc
• US, Canada, Mexico
• European Union (EU)
• The largest common market
• 27 nations combined GDP 15Trillion
• Goal is to bolster Europes trade position