With today’s workforce becoming increasingly diverse and organizations doing more to maximize the benefits of the differences in employees, Human Resource managers are evolving from the “old school” sideline player to the front-line fighters. Organizations are relying on managers to get the people who get the job done, and of course, make the company money. People have always been central to organizations, but their strategic importance is growing in today’s knowledge-based business world like never before. An organization’s success increasingly depends on the knowledge, skills, and abilities of its employees, particularly as they help establish a set of core competencies which distinguish one organization from its competitors.
When employees’ talents are valuable, rare, difficult to imitate and organize, an organization can achieve a sustained competitive advantage. In order to “compete through people”, an organization has to be able to do a good job of managing their human capital: the knowledge, skills, and capabilities that add value to the organizations. Managers must develop strategies for identifying, recruiting, and hiring the best talent available. Develop these individuals in ways that are specific to the needs of their individual firms, encourage them to generate new ideas while familiarizing them with the company strategies, invite information sharing, and rewarding collaboration and team work. The basis on which compensation payments are determined, and the way they are administered, can significantly affect employee productivity and the achievement of organizational goals. Establishing compensation programs require both large and small organizations to consider specific goals. Employee retention, compensation distribution and adherence to the budget must be carefully weighted against the overall organizational goals and expectations. Compensation must reward employees for past performance while serving as a motivation tool for future performances. Internal and external equity of the pay program will affect employees’ concepts of fairness. Organizations must balance each of the concerns while still remaining competitive.
For internal equity an organization can use one of the basic job evaluation techniques to determine relative worth of job. The most common are the ranking and classification methods. The job ranking system arranges jobs in numerical order on the basis of the importance of the job’s duties and responsibilities to the organization. Job classification slots jobs into preestablished grades with higher rated grades requiring more responsibilities, working conditions, and job duties. External equity can be determined by a wage survey. Data obtained from the surveys will facilitate establishing the organization’s wage policy while ensuring that the employer does not pay more, or less, than needed for jobs in the relevant labor market. Base salary is only one aspect of a retention plan for important employees. Benefits and incentive plans are valuable perks in recruiting and retaining essential employees. Benefits are an established and integral part of the total compensation package. In order to have a sound benefits package there are certain basic considerations. It is essential that a program be based on specific objectives that are compatible with the organizational philosophy and policies as well as affordable to the company. By utilizing a flexible benefits package, employees are able to choose those benefits that are best suited to their individual needs. Incentive pay plans can be advantageous to both the employer as well as the employee. The success of an incentive pay plan depends on the organizational climate in which it must operate, employee confidence in it, and its suitability to employee and organizational needs. Importantly, employees must view the incentive plan to be equitable and related to their performance.
Performance measures should be quantifiable, easily understood, and bear a demonstrated relationship to organizational performance. Performance appraisal programs serve many purposes, but in general those purposes can be clustered into two categories: administrative and developmental. The administrative purposes include decisions about who will be promoted, transferred, or laid-off. They can also include compensation decisions and the like. Developmental decisions include those related to improving and enhancing an individual’s capabilities. These include identifying a person’s strength and weaknesses, eliminating external performance obstacles, and establishing training needs. Within many organizations, performance appraisals are seen as a necessary evil. Managers frequently avoid conducting appraisals because they dislike playing the role of judge. As a result appraisals are conduct annually, for good or evil, and forgot about. Largely the success of an organization depends on the performance of its human resources. To determine the contributions of each individual, it is necessary to have a formal appraisal program with clearly stated objectives. Carefully designed performance standards that are reliable, strategically relevant, and free from either criterion deficiencies or contamination are essential foundations for evaluation. The use of multiple raters is frequently a good idea because different individuals see different facets of an employee’s performance. The supervisor, for example, has legitimate authority over an employee and is in a good position to discern whether he or she is contributing to the goals of the organization. Peers and team members, on the other hand, often have an unfiltered view of an employee’s work activity, particularly related to cooperation and dependability.
By offering enticing compensation packages, equitable pay, flexible benefits and known incentives an organization allows itself the luxury of identifying and selecting those which meet the needs of the organization. This selection process should provide as much reliable and valid information as possible about applicants so that their qualifications can be clearly matched with job specifications. The information gathered from applications and interviews must be reliable and valid, clearly job-related or predictive of success on the job and free from potential discrimination. The interview is an important source of information about the job applicant. It can be unstructured, wherein the interviewer is free to pursue whatever approach and sequence of topics that might seem appropriate or structured where each applicant receives the same set of questions, which have preestablished answers. Regardless of the technique chosen, those who conduct interviews should receive specialized training with interviewing methods. This gives the Human Resource manager the most relevant information for making a knowledgeable decision about which applicant will fulfill the needs of the organization. In filling job openings above the entry level an employer usually finds it advantageous to use transferring and internal promotions. By recruiting from within, an organization rewards employees for past performances and sends a signal to other employees that their future efforts will payoff, while capitalizing on previous investments made in recruiting, selecting, developing, and training its current employees.
Today organizational operations cover broad areas and require continuous training for effective job performance, evolutions in product areas, and corporate growth. In order to have effective training programs organizations can utilize a systems approach. Key areas of this approach include needs assessment, program design, and evaluation. Needs assessment begins with organizational analysis. Managers must establish a context for training by deciding where training is needed, how it connects with strategic goals, and how organizational resources can best be used. In designing a training program, managers must utilize principles of learning in order to create an environment that is conducive to learning. The evaluation of a training program should focus on several criteria: participant reactions, learning, behavior changes on the job, and bottom line results. Human Resource Management’s front-line fight is to get the organization in order. As Tom Peters stated “Trust people treat them like adults, enthuse them by lively and imaginative leadership, develop and demonstrate an obsession for quality, make them feel they own the business, and your work force will respond with total commitment”. Evidence points to a more active interest in and careful implementation of human resource management. Management is, by definition, getting things done through people. If managers are to increase productivity, reduce costs, and improve their organization’s competitive advantage, they must focus on how to properly manage personnel. Creating effective motivation and leadership, recruiting and retaining the right personnel, rewarding and treating employees fairly, establishing an environment that supports the people and benefits the organization, the Resource Manager looks towards a future with exciting challenges and opportunities for managing an organization’s most valuable resource – its people.