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Human Resource Management (HRM)


Title: Landkarte f r HRM I und II Author: Gudela Grote Last modified by: Gudela Grote Created Date: 9/29/2004 10:08:30 AM Document presentation format – PowerPoint PPT presentation

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Title: Human Resource Management (HRM)

Human Resource Management (HRM)
  • What?
  • the functional area of an organization that is
    responsible for all aspects of hiring and
    supporting employees (e.g., providing and
    administering employee benefits).
  • all the activities related to the recruitment,
    hiring, training, promotion, retention,
    separation, and support of employees.
  • functions within a company that relate to people.
  • Why?
  • is the effective use of human resources in order
    to enhance organisational performance.
  • the process of evaluating human resource needs,
    finding people to fill those needs, and getting
    the best work from each employee by providing the
    right incentives and job environment, all with
    the goal of meeting the needs of the firm.
  • applying human resources within complex systems
    such that people succeed, performance improves,
    and human error decreases.

(Source web definitions for HRM)
Road map for HRM Leading teams (Spring Semester)
Task / Work process
Topics HRM Leading teams
Core functions of HRM
  • Job analysis and design
  • Recruitment and selection
  • Training and development
  • Performance management and compensation
  • Labor and employee relations

Examples in the news HR implications?
  • Bonus payments in banks
  • Swiss Re CEO Aigrain quits after major losses
  • SR Technics closes Dublin plant with more than
    1000 employees
  • Hitzfeld on managing a national football team as
    a distributed team of club players
  • Increasing use of short time work

Topics HRM Leading teams
Strategic Human Resource Management
  • "a pattern of planned human resource deployments
    and activities intended to enable an organization
    to achieve its goals" (Noe et al., 2005)
  • Derive human resource needs (skills, behaviors,
    culture) from strategy formulation
  • Strategy implementation by means of HRM
    practi-ces, which further individuals'
    capabilities and motivation as well as actual

HRM practices Strategic choices
  • Job analysis and design
  • e.g. simple vs. complex tasks, specific vs.
    generic job descriptions
  • Recruitment and selection
  • e.g. external vs. internal recruitment, specific
    vs. general skills
  • Training and development
  • e.g. focus on current vs. future skills, train
    few vs. all employees
  • Performance management and compensation
  • e.g. behavioral vs. results criteria, internal
    vs. external equity, input vs. behavior vs.
    output control
  • Labor and employee relations
  • e.g. GAV vs. individual contracts

Examples of contingencies in strategic HRM (Snell
Youndt, 1995 Lepak Snell, 1999)
  • Input vs. behavior vs. output control
  • behavior control only works with low
  • input control most effective with high
  • output control has no effect on performance in
    any condition
  • Uniqueness and value of human capital
  • traditional, loyalty based employment
    relationship when knowledge and skills are
    firm-specific and of high competitive value
  • purely economic employment relationship when
    knowledge and skills are neither firm-specific
    nor of high competitive value

HRM practices Operational decisions
  • Job analysis and design
  • e.g. adaptations in job assignments support for
    job crafting
  • Recruitment and selection
  • e.g. defining specific job requirements
    composition of selection teams
  • Training and development
  • e.g. individual career planning
    internal/external course offers
  • Performance management and compensation
  • e.g. defining pay scales specifying appraisal
  • Labor and employee relations
  • e.g. adjusting contributions/inducements in the
    psychological contract

HRM as operational leadership taskLinking
motivation, satisfaction and performance
Topics HRM Leading teams
Influence of normative assumptions on strategic
and operational HRM
  • Example assumptions about human nature (Schein,
  • Economic man Employees will do whatever affords
    them the greatest economic gain
  • Social man Social needs are the prime motivator
    of human behavior, and interpersonal
    relationships the prime shaper of a sense of
  • Self-actualizing man People seek a sense of
    accomplishment in their work and are primarily
    self-motivated and self-controlled
  • Complex man Human needs fall into many
    categories and vary according to stage of
    development and total life situation

Leadership instruments based on the "complex man"
  • Management by objectives based on goal-oriented
    theories of leadership
  • Psychological contract based on social exchange

MbO How to make it work
  • Coherent company strategy
  • Increasing personal resources through job design
    and personnel development for dealing with
    complex goals and tasks
  • Sufficient control over the work situation
    (transparency, predictability, means of
  • Leadership through coaching instead of
  • Systematic, transparent and participative goal
    agreement and evaluation of goal attainment
  • Rules for handling conflicts

Complementing MbO Designing psychological
  • Psychological contracts ...
  • complement and super-impose legal contracts.
  • contain reciprocal, though not necessarily
    correspon-ding expectations and offers between
    employee and employer.
  • are derived from verbal agreements as well as
    from behaviors of contract partners and other
    members of the organization.
  • The more corresponding
  • and
  • the more explicit the agreement
  • the sounder the psychological contract.

Using the psychological contract to handle
employment uncertainties
  • Communicate and match reciprocal expectations and
  • Early, comprehensive information also on
    uncertain developments (individual and
  • Support employability through training, job
    design, and systematic career management
  • Distribute risks between organization and
    employee according to individual coping
  • Further organizational commitment which allows
    for flexibility and "thinking in options"

Topics HRM Leading teams
Purposes of appraisal
  • Improving performance
  • Making reward decisions
  • Motivating staff
  • Developing subordinates
  • Identifying potential
  • Formal recording of unsatisfactory performance
  • Note Conscious decision on which purpose(s) to
    focus on is important

Appraisal criteria
  • Assessment of personal characteristics/
  • Recommendation Focus on assessing behaviors,
    e.g. by means of behaviorally anchored rating
    scales (BARS), and on assessing outcomes based on
    achievement of objectives
  • Compare performance between individuals
  • rank order
  • grouping according to a predetermined percentage
    per evaluation category

Typical errors in appraising others
  • Primacy/recency
  • Halo
  • Implicit theories
  • Stereotypes
  • Central tendency and positive skew
  • Persistence of impression despite information to
    the contrary
  • Attribution errors

Attribution errors
  • Attributionattributing causes to behaviors
  • evaluating differences in behavior by comparing
    people, tasks, and situations in terms of causes
    for behavior (dimensions e.g. internal/external
    causes stable/variable causes)
  • Examples of attribution errors
  • Fundamental attribution error overemphasizing
    the actor as a cause of events
  • Protecting self-esteem Underestimating
    person-related causes for ourselves especially
    for failure
  • Underusing consensus information little use of
    information from comparisons with others
  • Confirming expectations e.g. assuming
    person-related causes for behaviors that are
    atypical for a particular situation assuming
    situation-related causes in highly structured

Measures to avoid rating errors
  • Systematic preparation of appraisal interview
  • Conscious reflecting of potential errors and
    their influence on the appraisal
  • Use of structured assessment scales (e.g. BARS)
  • Open communication climate that also allows
    critical feedback on the appraisal by the
    appraised person

Topics HRM Leading teams
Pay is ...
  • money
  • compensation
  • reward
  • incentive
  • recognition
  • Procedural and distributive justice at least as
    important as absolute amount

Basics for determining pay
  • Decomposition of pay into
  • base/fixed pay (task-related) and
  • variable pay (person-related, e.g. performance,
    experience, social situation)
  • Considering value of the work done for the
    company, the market rate for the job, and
    individual needs
  • Considering task requirements and qualification

Problems of current job evaluation systems
  • Overestimation of intellectual and leadership
  • Underestimation of physical, social and emotional
  • Consequence Low evaluation of many
    female-dominated jobs and person-related
    service jobs in general

Personnel development
  • Systematic furthering of personal aptitude in
    relation to individual expectations and
    organizational requirements by means of
  • - education/training
  • - counselling/coaching
  • - management by objectives
  • - team development
  • - job design

"Fit human to task"Linking personnel
development to strategic HRM demands
  • Analyze requirements
  • define goals and target group(s) for personnel
  • define required qualification profiles
  • identify indivdiual employees who need
  • Personnel development intervention
  • Evaluation concerning learning, behavior, and
    performance outcomes

"Fit task to human"Tailoring personnel
development to individual career demands
  • Define possible career paths
  • e.g. management versus technical career
  • Identify individual career needs
  • e.g. locals versus cosmopolitans
  • Continuous adaptation of career needs and career

Topics HRM Leading teams
Leadership is
  • the process of influencing the activities of an
    organized group towards goal achievement.
  • the ability of an individual to motivate others
    to forego self-interest in the interest of a
    collective vision (House Shamir, 1993)
  • the influential increment over and above
    mechanical compliance with the routine directives
    of the organization (Katz Kahn, 1978)

Basic leadership functions
  • group internal functions
  • Task orientation/initiating structure
  • Set goals, distribute tasks, check work results
  • Employee orientation/consideration
  • resolve conflicts, support/coach team members
  • group external functions
  • Boundary regulation
  • Adjusting external demands in terms of group
    internal demands and possibilities

Prerequisites of effective leadershipThe
"right" ...
  • Person
  • extravert, intelligent, emotionally stable,
    conscientious, dominant, self-confident, socially
  • However
  • Differences on personality dimensions between
    people with/without leadership positions are
    often small (overlapping distributions).
  • Personality differences may be causes and/or
    effects of being in leadership positions.
  • Different situations may demand different
    personality profiles.

Prerequisites of effective leadershipThe
"right" ...
  • Behavioral style
  • task-centred and employee-centred
  • democratic rather than autocratic
  • transformational rather than transactional
  • However
  • Individualized leader-member-exchange is also
  • Different situations may demand different
    behavioral styles.

Prerequisites of effective leadershipThe
"right" ...
  • Instruments
  • Management by objectives
  • Systematic performance management
  • Standardized HRM processes for selecting,
    appraising, compensating, developing people
  • However
  • Instruments can support, but not replace personal
  • Most instruments tend to work better in stable

Topics HRM Leading teams
Core concept of job designSelf-regulating teams
  • Teams several people who work together over a
    period of time to reach common goals and who
    share a sense of belonging together
  • Self-regulation individual and collective
    autonomy in order to coordinate work processes
    and to cope with process variances and
    uncertainties locally

Prerequisites for good team work
  • Adequate common task
  • Complexity higher than individual competencies
  • Clear performance criteria
  • Collective decision competence
  • Shared goal orientation
  • Positive goal coupling
  • Goal transparency and feedback
  • Adequate group composition
  • Different perspectives on the task
  • Shared language
  • Development of group rules
  • Adequate group size
  • Support for team development (form, storm, norm,
  • Explicit handling of conflicts between individual
    and collective autonomy

Team diagnosisCharacteristics of effective teams
  • Goals are clear and accepted
  • Individual and team goals melt together
  • Responsibilities are clear and change depending
    on situational demands
  • Leadership is seen as a shared responsibility
  • Conflicts are dealt with
  • Team learns and develops
  • Contributions are recognized and valued
  • Communication is open and engaged
  • Group processes are reflected upon and discussed

Changing leadership roles depending on stage in
work processes
  • Providing structure at the start of a process
  • Deciding in critical phases
  • Coach/motivator in on-going work processes
  • Team member ( no leadership) in routine
  • Moderator in decision processes
  • Evaluator at the end of a process

New demands on leadership in distributed teams
Increasing complexity of situation also requires
increasingly complex leadership behaviors
situated and shared leadership
Topics HRM Leading teams
What is meant by team diversity?
  • Demographic diversity differences in observable
    attributes such as age, gender, ethnicity
  • Psychological diversity differences in
    underlying attributes such as abilities,
    personality, attitudes, values

Why are organizations concerned with diversity
  • demographic change
  • e.g. problems in recruiting personnel
  • globalization of business
  • e.g. international supply chain relationships and
    mergers/acquisitions/international cooperations
  • increasing service orientation
  • e.g. responding to special needs in regional
    markets and of particular target groups
  • new concepts of organization
  • e.g. increasing mix of functions/professions in
    work teams

Success of Diversity Management ?
  • Studies on the relationship between team
    diversity and performance
  • Negative effects through social categorization
  • Positive effects through increased information
    however sharing information is generally
  • With time negative effects of demographic
    diversity (? social categorization) decrease and
    positive effects of psychological diversity (?
    information sharing) increase (Harrison et al.,
  • Cultural majorities profit from cultural
    minorities more than vice versa in student groups
    (Brodbeck, 2005)

Success of Diversity Management ?
  • Studies on the relationship between team
    diversity and performance (contd.)
  • Positive attitude towards diversity is important
    to achieve positive effects (Van Dick et al.,
  • More complex tasks are dealt with better by
    heterogeneous groups (Bowers et al., 2000).
  • Group goals support performance in diverse
    (individualists/collectivists) and non-diverse
    teams (Crown, 2007)
  • No studies available on diversity and firm

Topics HRM Leading teams
"Benchmarking" Characteristics of HRM in
successful companies (Pfeffer, 1998)
  1. Employment security
  2. Selective hiring
  3. Self-managed teams and decentralization
  4. High compensation contingent on organizational
  5. Extensive training
  6. Reduction of status differences
  7. Sharing information

Topics HRM Leading teams
Sample questions for exam preparation
  • written, closed (!) book, 1.5 h
  • Friday June 5, 815 - 945, HG G3
  • five essay questions, four have to be answered
  • sample questions
  • (1) Coaches of successful football teams are
    often taken as models for effective leadership in
    companies. Based on the leadership concepts
    dicussed in the lecture, is this justified?
  • (2) What would you do when conducting a
    performance appraisal interview in order to avoid
    attribution errors?
  • Exam counts for 50 and semester project for 50
    of total course grade.

Master thesis topics
  • Currently offered thesis topics
  • Analysis of organizational routines in high-risk
  • Organizational dynamics of regulation in the
    finance sector
  • Collaborative planning and the role of
    information uncertainty in Air Traffic Management
  • Planning and coordination in health care
  • It is always possible to directly contact any
    member of the research group to discuss
    possible topics, see also the description of
    research on our webpage