Human Resource Management 9789351194309

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Human Resource Management Dr. T. Raju Professor and Head, MBA Department Coimbatore Institute of Engineering and Technology (Formerly Regional Director of Research, Coffee Board, Govt. of India)

Dr. S. Jaya Bharathi Professor, MBA Department Coimbatore Institute of Engineering and Technology Coimbatore

© Copyright 2014 by the Authors The book may not be duplicated in any way without the express written consent of the publisher, except in the form of brief excerpts or quotations for the purpose of the review. The information contained herein is for the personal use of the reader and must not be incorporated in any commercial programmes, other books, databases, or any kind of software without written consent of the publisher. Making copies of this book or any portion thereof for any purpose other than your own is a violation of copyright laws. Limits of Liability/ Disclaimer of Warranty The authors and publishers have used their best efforts in preparing this book. The authors make no representation or warranties with respect to the accuracy or completeness of the content of this book, and specifically disclaims any implied warranties of merchantability or fitness for any particular purpose. There are no warranties which extend beyond the description contained in this paragraph. No warranty may be created or extended by sales representatives or written sales materials. The accuracy and completeness of the information provided herein and the opinion stated herein are not guaranteed and warranted to provide any particular results, and the advice and strategies contained herein may not be suitable for every individual. Neither Biztantra (Dreamtech Press) nor the authors shall be liable for any loss of profit or any commercial damages, including but not limited to special, incidental, consequential, or other damages. Trademarks All brand names and product names used in this book are trademarks, registered trademarks, or trade names of their respective holders. Dreamtech Press is not associated with any product or vendor mentioned in this book.

ISBN: 978-93-5119-430-9 ISBN: 978-93-5119-479-8 (ebk) Note: CD content is not a part of eBOOK

Dedicated to My better-half, Smt. Vasantha Raju, who stood with me through thick and thin. Dr. T. Raju

My beloved parents, sister, husband Shri Marimuthu and loving daughter Nandhini, who are behind me in all my endeavours Dr. S. Jaya Bharathi

Human Resource is the prime resource of any organization that manages the effective utilization of other resources. There is a need for thorough understanding and special knowledge base to harness this unique resource to the fullest extent. Proper Human Resource Management increases the productivity of organizations to gain a competitive edge. It helps organizations to be ahead in times of turbulence and economic uncertainty. It is in this context, many books have been written on this important and ever-growing field of management. I am glad to note that our professors, Dr.T.Raju and Dr.S.Jaya Bharathi from MBA department, Coimbatore Institute of Engineering and Technology have written a book on Human Resource Management, an area that is always in vogue. The book covers all the fundamental concepts and basic functions of the subject Human Resource Management in a clear and comprehensive manner. Further, it also highlights special areas like workplace diversity, High Performance Work Systems, ethics, SHRM etc. that have topical interest in the current scenario. The book is suited to a variety of readers particularly academicians, students, executives and HR professionals, as it covers all the topics. It can be adopted by any university offering the subject to include in their curriculum. The simple and lucid language used will attract the student community to gain basic knowledge on the concepts and to understand the latest happenings in the arena of Human Resource Management. The photographs and cartoons make the reading more interesting. I find the inclusion of HR practices being followed in Indian organizations, specialist views and the case studies certainly add value to improve the understanding of various topics. The classroom and field exercises added in every chapter will be of much help to the teachers to make the teaching more effective. The book is very interesting as topics are presented with live examples and illustrations. I congratulate the authors for their earnest efforts in writing a simple and concise book on Human Resource Management and I wish them all the best for future endeavours. Dr.K.A.Chinnaraju, M.Sc., MBA, M. Tech., Ph.D., Director/Secretary, Kovai Kalaimagal Educational Institutions, Coimbatore.

It goes without saying that human resource is the most important resource to any organization, commercial or non-commercial. It is the human resource which creates, develops and deploys other resources such as money, materials, machinery etc. Hence unless the human resource is nurtured and taken care of, the goals of any organization cannot be achieved as desired. And, of course, human resource is not that easy to manage as human beings change their attitude time and again. There are many well-written books on HRM by Indian as well as foreign experts in the domains of human resource management. But most of the books are voluminous. The present day young executives, hard-pressed for time to reach their deadline in target achievement and the management students of varied background who have to grapple with many subjects in a short span neither have time nor inclination for a serious, in depth reading. This book, written in a simple language covering the entire gamut of HRM from HR planning through recruitment, selection, training / development, performance appraisal, compensation, career planning to separation, is expected to cater to the needs of busy young executives and the students of management and allied courses. In addition to the rudiments of HRM some special topics such as workplace diversity, human resource accounting, HR audit, high performance work systems, challenges in HRM, global HRM, Strategic HRM, ethics, fair treatment, procedural justice and financial impact of HRM are also discussed. The topics covered in the book gives the readers a comprehensive overview of fundamental concepts in HRM and also the fields of HR in vogue. Care is taken to include all possible HR areas of interest in the academic as well as industrial perspective. Most of the explanations on the HRM concepts are drawn from the books written by Cascio, F.W., Decenzo, D.A. & Robbins, S.P., Dessler, G, and Noe, R.A. et al and Snell, S & Bohlander, G. Illustrations are given in a lucid manner to substantiate concepts that need diagrammatic or pictorial support for easy understanding. Every chapter in this book starts with the information on HR practices followed by Indian organizations to exhibit HR aspects in the Indian context. These vignettes throw light on current HR happenings in the industry and bring out the importance of HR in organizations. Also, the chapters are fully laden with relevant examples and photographs wherever needed to elucidate the concepts. Every chapter is concluded

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with review questions, specialists’ opinion on various topics of HR, case studies from question papers and class exercises for students. These aspects will especially help the student community to gain better understanding of the topics both from gathering knowledge and examination point of view. Though many organizations take HRM seriously, there are organizations which offer only, lip sympathy to employees. A few cartoons, “HRM-In lighter vein” are inserted here and there to highlight that all is not well with HRM. The cartoons are intended not to criticize any organization or industry in particular but to make the reading a little humorous. Dr. T. Raju Dr. S. Jaya Bharathi

This book is divided into two parts (Section A and Section B). Section A deals with the fundamentals of the subject “Human Resource Management” viz. Job analysis and design, HR planning, HRIS, Recruitment, Selection, Socialization, Orientation, Training / Development, Performance appraisal, Compensation, Employee health, Safety, Career development, Labour relations, Collective bargaining, Separation and Retention. Under each topic, the concepts are explained with relevant examples and illustrations wherever applicable. All the said topics are discussed in a logical sequence to make the reader understand the concepts in a better manner. The examples are drawn from current business scenario to give a practical orientation and analogy so as to appreciate the application of these concepts in the industry. Section B deals with special and current topics in the subject like workplace diversity, human resource accounting, and high performance work systems etc. to appreciate the latest happenings in the HR field. Every chapter is ended with review questions, specialists’ opinion on various topics of HR, case studies and classroom / field exercises for students. These aspects will specially benefit the student community to gain better knowledge and prepare for examinations. Cartoons are included to make the reading interesting. The basics of the subject and special areas in vogue make the book more suitable to be adopted by any university offering the subject and related areas in its curriculum.

Dr. T. Raju with M.A. in Personnel Management & Industrial Relations, M.Sc. in Psychology, MBA in Human Resource Management, M.Sc(Ag) in Soil Science and Ph.D in Soil Science [Nutritional Management] was with the Research Department of Coffee Board, Govt. of India, for 28 years in different capacities. During the last ten years of his service he was the Regional Director of Research monitoring the research activities of Coffee Board in Tamilnadu/Kerala. During his tenure in Coffee Board he executed many research projects and published 30 research as well as review articles. As part of the job, he conducted many training programmes for coffee planters and research workers. He arranged many seminars on research in coffee. He wrote a book titled ‘Coffee Hand Book’ based on his experience in coffee research. After his voluntary retirement from Central Government service, he worked as General Manager in a large plantation for two years and later served as a Professor in Management at SNR Sons College, Coimbatore for 10 years. Presently (since June 2009), he is the Professor & Head, Department of Management Studies and Research at Coimbatore Institute of Engineering and Technology. He has handled many papers in General Management and Human Resource Management for 15 years. He has attended many national and international seminars and workshops on HRM. He has been a Resource Person and chaired sessions on HRM in seminars/workshops/ conferences conducted by B-Schools. He has delivered lectures on topics in Human Resource Management in various colleges in and around Coimbatore as a visiting professor. In addition to teaching, he is a consultant for coffee plantations. Recently he has written a book “Organizational Behaviour” published by Biztantra. Dr. S. Jaya Bharathi with B.E. in Electrical and Electronics Engineering, MBA in Human Resource Management, and Ph.D in Management (Human Resource Development) was initially associated with electronics

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industry in Marketing Co-ordination and Human Resource Administration operations for few years. Later, she moved to academics and is serving in the management education field for the past 13 years in various capacities. She is currently (since June 2010) working as a Professor, Department of Management Studies and Research at Coimbatore Institute of Engineering and Technology. She has authored many research articles published in journals of repute. She has edited three books in the areas of Drucker’s contribution to management, Rural empowerment and Corporate strategies. She has also contributed articles to many edited books on diverse fields of management. She is an approved research guide of Bharathiar University for M. Phil and Ph.D in management and for Ph.D (management studies) in erstwhile Anna university of Technology Coimbatore. She is currently guiding seven Ph.D scholars in management sciences under Anna University, Chennai. She is invited as a subject expert to research circle meetings and is a doctoral committee member for many Ph.D scholars in management sciences. She has presented research papers in many national and international conferences in various fields of management and won few accolades of best paper awards. Her research areas of interest include HRM, HRD and Learning Organizations. She has acted as a resource person for Executive Development Programmes and Student Orientation Programmes in management. She has undertaken industrial consultancy assignments for corporates in the areas of HR, marketing and strategic management. She has coordinated various seminars, conferences and FDPs in management. She is teaching subjects in Human Resource Management for more than a decade and has conducted management games for students in various fields of Human Resource Management.

The authors are grateful to Dr.K.A.Chinnaraju, Director/Secretary, Kovai Kalaimagal Educational Institutions for the encouragement and facilities extended. They thank Dr.N.Nagarajan, Principal, Coimbatore Institute of Engineering and Technology and fellow faculty members for their kind help. They express their sense of gratitude to the Publisher, Mr. Rahul Gupta, for his faith and vision on the book and Mr. Yoginder Singh, Chief Editor, Biztantra, for his keen interest and timely help in getting the book published.

Dr. T. Raju Dr. S. Jaya Bharathi

Foreword Preface About the Book About the Authors Acknowledgements

v vii ix xi xiii

SECTION A: FUNDAMENTALS OF HUMAN RESOURCE MANAGEMENT

1

CHAPTER 1: HUMAN RESOURCE MANAGEMENT – AN INTRODUCTION

3

CHAPTER 2: JOB ANALYSIS AND JOB DESIGN

27

CHAPTER 3: HUMAN RESOURCE PLANNING AND HUMAN RESOURCE INFORMATION SYSTEM

61

CHAPTER 4: RECRUITMENT

77

CHAPTER 5: SELECTION

113

CHAPTER 6: SOCIALIZATION AND ORIENTATION

141

CHAPTER 7: TRAINING

159

CHAPTER 8: EMPLOYEE DEVELOPMENT

191

CHAPTER 9: PERFORMANCE APPRAISAL AND MANAGEMENT

225

CHAPTER 10: COMPENSATION: PAY, INCENTIVE SYSTEMS AND EMPLOYEE BENEFITS

275

CHAPTER 11: EMPLOYEE SAFETY AND HEALTH

321

CHAPTER 12: CAREER DEVELOPMENT

349

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CHAPTER 13: LABOUR RELATIONS AND COLLECTIVE BARGAINING

377

CHAPTER 14: EMPLOYEE SEPARATION AND RETENTION

413

SECTION B: SPECIAL TOPICS IN HUMAN RESOURCE MANAGEMENT

435

CHAPTER 15: DIVERSITY AT WORK

437

CHAPTER 16: MANAGING HUMAN RESOURCES GLOBALLY

459

CHAPTER 17: STRATEGIC HUMAN RESOURCE MANAGEMENT

481

CHAPTER 18: CREATING HIGH PERFORMANCE WORK SYSTEM

501

CHAPTER 19: ETHICS, FAIR TREATMENT AND PROCEDURAL JUSTICE IN HRM

525

CHAPTER 20: FINANCIAL IMPACT OF HRM

551

CHAPTER 21: HUMAN RESOURCE ACCOUNTING AND AUDIT

569

CHAPTER 22: CHALLENGES IN HRM

593

GLOSSARY

619

REFERENCES

661

INDEX

663

Foreword

v

Preface

vii

About the Book

ix

About the Authors

xi

Acknowledgements

xiii

SECTION A: FUNDAMENTALS OF HUMAN RESOURCE MANAGEMENT

1

CHAPTER 1: H UMAN R ESOURCE M ANAGEMENT – AN I NTRODUCTION

3

HRM – Indian Perspective (Infosys Technologies, Bangalore) Human Resource Human Resource Management Evolution of HRM Current Scenario Nature of HRM Scope of HRM Personnel Aspect Welfare Aspects Social Security Measures Aspect Industrial Relations Aspect Objectives of HRM Functions of HRM Roles and Responsibilities of HR Manager Role of HR Managers Responsibilities of HR Managers Competencies of HR Manager HR Policies HRM Concepts Line versus Staff Aspects of HRM Line Managers’ HRM Responsibilities

4 5 6 6 8 8 9 9 10 10 10 11 11 13 13 13 14 15 15 16 17

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HRM vs. Personnel Management Importance of HRM At the Individual Level At the Organization Level At the Society Level At the National Level Process of HRM Review Questions Specialists Speak Case Study

CHAPTER 2: J OB ANALYSIS

AND J OB

DESIGN

HRM – Indian Perspective (Tata Steel Limited) Job Analysis Methods of Collecting Job Analysis Information Techniques involved in Job Analysis O*NET and Job Analysis Approaches to Job Analysis Questions to be Answered in Job Analysis Why to Do Job Analysis? Competency Models and Job Analysis Job Description Job Title Job Identification Job Duties or Essential Functions Job Specification Job Design Job Design: Approaches and Outcomes – A Different Thinking Mechanistic Approach Motivational Approach Biological Approach Perceptual-Motor Approach Trade-offs among Approaches to Job Design Designing Work for Groups/Teams Employee Teams Forms of Teams Flexible Work Schedules Compressed Work Week Flextime Job Sharing

17 18 18 19 19 19 19 20 20 23

27 28 30 31 31 34 34 36 36 38 38 39 39 39 41 42 46 47 47 48 48 48 49 51 51 52 52 53 53

Detailed Contents

Telecommuting Review Questions Specialists Speak Cast Study

CHAPTER 3: H UMAN RESOURCE P LANNING

xix

54 55 56 59 AND

HUMAN RESOURCE I NFORMATION SYSTEM

HRM – Indian Perspective (Aditya Birla Group of Companies) HR Planning HR Planning System Talent Inventory HR Forecasting HR Forecast - Internal and External Sources Action Plans Control and Evaluation Importance of Human Resource Planning Human Resource Information System (HRIS) / Computer Applications in HRM Review Questions Specialists Speak Case Study

CHAPTER 4: RECRUITMENT HRM – Indian Perspective (Reliance Industries Limited) Recruitment Personnel Policies in Recruitment Internal vs. External Recruiting Lead-the-Market Pay Strategies Employment-at-will Policies Image Advertising Recruitment Sources Internal Sources External Recruitment – Sources Recruitment alternatives Which sources are most popular with employers and job applicants? Improving the Effectiveness of External Recruitment Constraints on Recruiting Efforts Importance of Recruitment Review Questions Specialists Speak Cast Study

61 62 63 64 64 65 68 68 68 69 70 72 72 74

77 78 79 80 80 81 81 81 82 82 87 98 102 102 104 105 105 106 108

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CHAPTER 5: SELECTION

113

HRM - Indian Perspective (Britannia Industries Limited) What is Selection? Selection Process Initial Screening Completing the Application Form Employment tests Reliability and Validity of tests Comprehensive Interview Effectiveness of Interview Types of Interview Background Examination Conditional Job Offers Medical/Physical Examination Permanent Job Offer Decision Strategy Approaches in Hiring Decisions Clinical Approach Statistical Approach Review Questions Specialists Speak Case Study

CHAPTER 6: SOCIALIZATION

AND

O RIENTATION

HRM – Indian Perspective (Wipro Technologies Limited) Socialization Assumptions of Socialization Realistic Job Preview Process of Socialization Employee Orientation Characteristics of Effective Orientation CEO’s Role in Orientation HRM’s Role in Orientation An Overview of Employee Orientation Orientation Follow-up Evaluation of Orientation Programme Review Questions Specialists Speak Case Study

114 116 117 118 118 120 122 124 124 124 130 130 131 131 131 132 132 132 134 135 138

141 142 143 144 146 146 148 149 149 150 150 152 152 153 154 157

Detailed Contents

CHAPTER 7: TRAINING HRM – Indian Perspective (ICICI Bank Limited) What is Training? Training vs. Development Need for Training Designing effective Training Programme – Training Process Step 1: Needs Assessment Step 2: Ensuring Employees’ Readiness for Training Step 3: Creating a Learning Environment Step 4: Ensuring Transfer of Training Step 5: Selecting Training Methods Hands-on Methods or On-the-job Training (OJT) Off-the-job Training Methods or Presentation Methods Step 6. Evaluating Training Programs Evaluation Designs Structural Issues in Training Characteristics of Effective Training Practice Review Questions Specialists Speak Case Study

CHAPTER 8: E MPLOYEE D EVELOPMENT HRM - Indian Perspective (Dr. Reddy’s Laboratories) Comparison between Training and Development Employee Development Methods Specific Development Activities Off-the-Job Programmes On-the-Job Development Programmes Knowledge Management Dimensions of Knowledge Management Knowledge Management Processes Mentoring Functions of Mentoring Developing Mentor-Protégé Relationship Potential Limitations of Mentoring Special Issues in Employee Development Review Questions Specialists Speak Case Study

xxi

159 160 161 162 162 163 164 165 166 167 169 171 173 178 180 181 183 183 184 188 191 192 193 194 196 196 205 212 213 213 214 214 215 216 218 219 220 222

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Human Resource Management

CHAPTER 9: P ERFORMANCE APPRAISAL

AND

M ANAGEMENT

HRM - Indian Perspective (Ashok Leyland Limited) Performance Appraisal Performance Management Performance Planning and Evaluation System Components of Effective Performance Management Purposes of Performance Appraisal Strategic Purposes Administrative Purposes Developmental Purposes Specific Purposes Requirements of Effective Appraisal Systems Appraisal Process Performance Appraisal Methods Graphic Rating Scale Mixed-standard Scales Forced-choice Method Forced Distribution Essay Method (Narrative Essay) Critical Incident Method Behavioural Checklist Method Behaviourally Anchored Rating Scales (BARS) Productivity Measures or Productivity Measurement and Evaluation System (ProMES) Management by Objectives Balanced Score Card Simple Ranking Alternation Ranking Paired Comparison Work Planning and Review Adjective Rating Scale Organizational Behaviour Modification (OBM) Assessment Centres Quality Approach Who should Appraise an Employee's Performance? Evaluating the Performance of Teams Appraisal Interview and Feedback Types of Appraisal Interviews Preparing for the Appraisal Interview

225 226 227 227 228 228 230 230 230 231 231 232 234 235 238 239 241 241 243 243 244 246 248 249 250 251 251 251 252 252 252 253 253 254 259 261 261 261

Detailed Contents

Appraisal Errors Reasons for Failure of Appraisal Systems How to Develop an Effective Performance Appraisal System Improving Performance Review Questions Specialists Speak Case Study

CHAPTER 10: COMPENSATION: PAY, INCENTIVE S YSTEMS

AND

E MPLOYEE BENEFITS

HRM – Indian Perspective (Associated Cement Companies Limited) Employee Compensation Employer’s Point of View on Compensation Employees’ Point of View on Compensation Types of Compensation Intrinsic vs. Extrinsic Rewards Financial vs. Nonfinancial Rewards Performance-based vs. Membership-based rewards Effective Compensation System Strategic Compensation Planning Fixing of Pay Rates Alternative to Pay Systems based on Job Evaluation Market-based Pay System Competency-based Pay Determinants of Pay Structure Incentive Systems Merit System vs. Incentive System Requirements of Effective Incentive Systems Administration of Incentive Plans Individual Incentive Plans Piece Work Standard Hour Plan Bonuses Merit Pay Lump-sum Merit Pay Incentive Awards and Recognition Types of Sales Incentive Plans Group Incentive Plans Team Compensation Plans Gain Sharing Plans Organization Level Incentive Plans

xxiii

262 263 264 265 267 268 271

275 276 277 277 278 278 279 279 279 279 280 282 284 284 284 285 287 287 288 288 289 289 290 290 291 291 292 292 293 293 294 297

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Profit Sharing Plans Stock Options Employee Stock Ownership Plans (ESOPs) Incentives to Professional Employees International Compensation Assessing Incentive Programs Compensation Issues Equal Pay Wage-rate Compression Low Salary Budgets Effect of Inflation Pay Secrecy Problems with Job-based pay Problems with Skill-based pay Government Regulations Changing Scenario in Compensation Employee Benefits Unique Features of Employee Benefits Why Employee Benefits? Objectives of Employee Benefits Types of Employee Benefit Schemes Strategic Considerations Requirements of a Good benefits Plan The Flip Side of Employee Benefits Review Questions Specialists Speak Case Study

CHAPTER 11: E MPLOYEE S AFETY

AND

H EALTH

HRM – Indian Perspective (Tata Consultancy Services Limited) What Causes Accidents? Chance Occurrences Unsafe Conditions Unsafe Behaviours Creating a Safe Environment Employee-management Safety Committee Safety Awareness Enforcing Safety Rules Investigating and Recording Accidents Installing Accident Prevention Mechanisms

298 298 299 300 302 303 304 304 304 305 305 305 306 306 306 307 307 308 309 309 309 312 312 313 314 314 317

321 322 325 325 325 326 327 327 327 328 329 329

Detailed Contents

Reducing Unsafe Conditions and Unsafe Acts Providing Incentives and Positive Reinforcement Emphasizing Top-Management Commitment Fostering a Culture of Safety Establishing a Safety Policy Conducting Safety and Health Inspections Protecting Vulnerable Workers Employee Health Problems and Preventive Measures Chemical Hazards Tobacco Smoke Alcoholism and Drug Abuse Computer Monitor Health Problems Maintaining a Healthy Work Environment Work Place Violence Job Stress What is Stress? Sources of Job-related Stress How to Reduce Job Stress? Employee Assistance Programmes International Safety and Health International Health Issues International Safety Issues Review Questions Specialists Speak Case Study

CHAPTER 12: CAREER D EVELOPMENT HRM – Indian Perspective (Asian Paints) Career Career Management/Development/Planning Career Development vs. Employee Development Why should Organizations Care for Employees’ Career Development? How Individuals are Benefitted by Career Development Programmes? Stages of Career Development Goal of Career Development/Management The Employee’s Role The Organization’s/Manager’s Role Most Successful Career-management Practices Identifying Career Opportunities and Requirements Competency Analysis

xxv

330 330 330 330 331 331 331 331 331 332 332 333 333 334 336 336 337 339 341 341 341 342 343 344 347

349 350 352 352 353 353 354 355 358 359 359 359 360 360

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Human Resource Management

Identifying Job Progressions Recognition of Various Possibilities Promotion Transfer Demotion Outplacement Services Dual Career Paths Boundaryless Career Avoiding the Plateau Trap Career Development Initiatives Determining Individual Development Needs Top Ten Myths about Mentors Innovative Career Development Initiatives Enhancing Career Review Questions Specialists Speak Case Study

CHAPTER 13: LABOUR RELATIONS

AND

C OLLECTIVE BARGAINING

HRM – Indian Perspective (TVS Group of Companies) Labour Relations Labour Relation or Industrial Relations System Labour Relations: Management vs. Labour Union Why Workers Join Trade Unions? Trade Unions in India Objectives of Labour unions Labour Legislations Collective Bargaining Good-faith Bargaining Negotiation Techniques Low-risk Negotiation Techniques High-risk Negotiations Failure of Negotiation Strikes Types of Strike Lockout Rules of Conduct During a Strike Union’s Claims vs. Management’s Claims Impasse Resolution (Problem Solving) Mediation

360 360 361 361 362 362 362 362 363 364 365 366 368 368 368 370 373

377 378 380 381 381 382 383 384 385 386 387 388 388 389 390 390 391 391 392 393 394 394

Detailed Contents

Fact Finder Arbitration Management’s Willingness to Face a Strike Unfair Practices in Industrial Relations Do’s and Don’ts for Supervisors Grievance Handling Employee Initiated Grievance Discharge Grievance Union or Group Grievance Present Scenario of Unionism Review Questions Specialists Speak Case Study

CHAPTER 14: EMPLOYEE S EPARATION

AND

RETENTION

HRM – Indian Perspective (Dabur India Ltd.) Employee Turnover Involuntary Turnover (Dismissal) Voluntary Turnover Managing Involuntary Turnover Progressive Discipline Alternative Dispute Resolution (ADR) Employee Assistance Programmes Outplacement Counseling Voluntary Turnover (Resignation) Process of Job Withdrawal Job Satisfaction and Job Withdrawal Sources of Job Dissatisfaction Measuring and Monitoring Job Satisfaction Survey-Feedback Interventions Managing Voluntary Turnover or Finding and Retaining the Best Employees Review Questions Specialists Speak Case Study

SECTION B: SPECIAL TOPICS CHAPTER 15: DIVERSITY

AT

IN

HUMAN RESOURCE MANAGEMENT

WORK

HRM – Indian Perspective (Essar Group of Companies) Why there is Increase in Diversity at Work?

xxvii

394 395 395 397 399 399 400 401 401 401 403 403 408

413 414 416 416 417 417 418 418 419 420 421 421 422 423 425 426 426 428 429 433

435 437 438 440

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Human Resource Management

The Shift from a Manufacturing to a Service Economy The Globalization of Markets New Business Strategies Mergers and Strategic Alliances The Changing Labour Market Managing Diversity Female Workers Generations X and Y Older Workers Differently-abled Workers People with Varied Sexual Orientation Advantages of Diversity Making the Case for Diversity Review Questions Specialists Speak Case Study

CHAPTER 16: M ANAGING H UMAN R ESOURCES GLOBALLY

440 441 441 441 442 442 442 443 443 445 446 447 448 450 451 453

459

HRM – Indian Perspective (Onida-Mirc Electronics) General Terms in Global Business Factors Influencing HRM in Global Markets Culture Education of Human Capital Politico-legal System Economic System Managing Employees Globally Level of Global Participation International Level of Participation Multinational Level of Participation Global Level of Participation International Staffing International Recruiting International Selection of Employees Review Questions Specialists Speak Case Study

460 462 463 463 465 466 466 467 467 467 467 468 468 469 470 472 473 477

CHAPTER 17: STRATEGIC H UMAN R ESOURCE M ANAGEMENT

481

HRM – Indian Perspective (ITC Limited) Strategic Human Resources Management

482 484

Detailed Contents

HR’s Role in Formulating Strategy HR’s Role in Executing Strategy Strategy Implementation and HRM Practices High Performance Work System HRM Needs in Different Types of Strategies Role of HRM in Providing Strategic Competitive Advantage Emergent Strategies Enhancing Organization Competitiveness Strategic Human Resource Executives Review Questions Specialists Speak Case Study

CHAPTER 18: CREATING H IGH PERFORMANCE WORK SYSTEM HRM – Indian Perspective (Bajaj Auto Limited) Basic Principles of HPWS Shared Information Knowledge Development Performance-reward Linkage Egalitarianism Features of HPWS Work Design HR Practices Leadership Role Information Technology HPWS as an Integrated Unit HR Scorecard – Assessing Strategic Alignment Implementing HPWS Establishing a Case for HPWS Plan for Communications Cooperation from Unions Transition to HPWS Assessing the Success of HPWS Benefits of HPWS Benefits to Employees Benefits to Organization Review Questions Specialists Speak Case Study

xxix

484 486 486 487 489 489 489 490 490 493 493 496

501 502 504 505 505 506 506 507 507 508 509 510 510 512 512 513 513 514 515 515 516 516 516 517 518 520

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Human Resource Management

CHAPTER 19: ETHICS, FAIR TREATMENT

AND

PROCEDURAL JUSTICE

HRM – Indian Perspective (Godrej Agrovet Limited) Ethics Factors Influencing Ethical Behavior at Work Role of HR Manager in Ethics and Fair Treatment Selection Training Performance Appraisal Executive Compensation Communication Employee Privacy and Ethical Issues Employee Discipline Factors to Consider in Discipline Disciplinary Guidelines for Effective HRM Types of Disciplinary Actions Progressive Discipline Managing Dismissals How to Avoid Wrongful Dismissal Suits? Termination Interview Procedural Justice Employee Voice Interactional Justice Informational Justice Grievance Procedure — Workplace Due Process Steps Involved in Grievance Redress Whistle-blowing Review Questions Specialists Speak Case Study

CHAPTER 20: FINANCIAL IMPACT

OF

HRM

HRM – Indian Perspective (Bharati Airtel Limited) Financial Impact Financial Impact of High-performance Work Practices Financial Impact of Employee Attitudes Costing Employee Absenteeism Costing Employee Turnover Components of Turnover Costs Financial Impact of Work-life Programmes

IN

HRM

525 526 528 528 530 531 531 532 532 532 533 534 535 535 536 537 539 540 541 541 542 544 544 544 544 545 546 547 549

551 552 554 555 557 559 559 561 562

Detailed Contents

Costing Impact of Training Measures of Training Outcomes Review Questions Specialists Speak Case Studies

CHAPTER 21: HUMAN RESOURCE ACCOUNTING

563 563 564 564 567 AND

AUDIT

HRM – Indian Perspective (Bharat Heavy Electricals Limited) HR in the Balance Sheet HR Accounting Should HR be Accounted in the Asset Column? An Accountant‘s View of HR Accountant’s Dilemma Staffing Performance Indicators (Carme et al., 1999) Internal External Intellectual Capital Assessment of Intellectual Capital Calculated Intangible Value Method (CIV) Market Value Added (MVA) Approach Human Resource Audit Definitions of HR Audit Objectives of HR Audit Types of HR Audit Process of HR Audit Methods of Data Collection for HR Audit Approaches to HR Audit Benefits of HR Audit Review Questions Specialists Speak Case Study

CHAPTER 22: CHALLENGES

IN

xxxi

HRM

HRM – Indian Perspective (National Thermal Power Corporation) Globalization Impact of Globalization on Business Impact of Globalization on HRM Ever Changing Technology Impact of Technology on HRM

569 570 573 573 575 575 576 576 576 577 578 578 579 579 580 581 581 581 582 582 583 583 584 585 589

593 594 596 596 597 597 597

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Change Management Role of HR in Change Management Managing Human Capital Role of HRM in Retaining and Managing Human Capital Responding to Market Forces TQM, Six Sigma and HRM HR and Six Sigma HR and Reengineering Containing Costs Demographic and Employee Concerns Demographic Changes Cultural Changes Managing Diversity Challenges Review Questions Specialists Speak Case Study

598 599 599 599 600 600 601 601 602 604 604 606 607 609 610 614

GLOSSARY

619

REFERENCES

661

INDEX

663

Fundamentals of Human Resource Management

Human Resource Management -An Introduction • • • • • • • • • • • • • • • •

Key Terms Human Resource HRM Competencies

HR Policies HR Concepts

Line Managers Personnel Management Processes of HRM

• • • • • • •

HRM - Indian Perspective Human Resource Human Resource Management Evolution of HRM Current Scenario Nature of HRM Scope of HRM Objection of HRM Function of HRM Roles and Responsibilities of HR Manager Competencies of HR Manager HR Policies HRM Concepts Line versus Staff aspects of HRM Line Managers’ HRM Responsibilities HRM vs. Personnel Management Importance of HRM Process of HRM Review Questions Specialists Speak Case Study Classroom Project Field Project

4

Human Resource Management

HRM – Indian Perspective

Infosys Technologies, Bangalore

”Our assets walk out of the door each evening. We have to make sure that they come back the next morning.” (Narayana Murthy, Infosys).

Infosys Office

Shri.N.Narayanamurthy, Executive Chairman

Infosys Office hri.N.Narayanamurthy, Executive ChairmanInfosys technology, a leading software company based in India, was voted as the best employer in the country in many HR surveys in the recent years. The company is well known for its employee friendly HR practices. Infosys attracts the best talent from across the country and recruits candidates by conducting one of the toughest selection processes. Infosys was one of the first companies to offer ESOPs to its employees. The company followed variable compensation structure where the employees’ compensation depended on the performance of the individual, the team and the company. Infosys includes its human resources on its Balance Sheet to affirm their asset value. The US Generally Accepted Accounting Principles (GAAP) was first adopted in India by Infosys. Additional disclosures are provided in the annual reports of Infosys so that the stakeholders can have deeper insights into the way the company is running its business. While recruiting new employees, Infosys took adequate care to identify the right candidates. They focus on recruiting candidates who display a high degree of ‘learnability’, the ability to derive generic knowledge from specific experiences and apply the same in new situations. Training at Infosys is an ongoing process. When new recruits from colleges joined Infosys, they are trained through fresher training courses on new processes and technologies. Later employees are trained on project management and sent for management development programs, followed by leadership development programs. Infosys TalentEdge consists of a set of functional components that provide human resource processes across the employee lifecycle. The Infosys Leadership Institute (ILI) was set up in 2001 to nurture future leaders in thecompany. As part of its inclusive HR policy, Infosys opened a satellite centre in the heart of the city to enable women employees, particularly new and to-be mothers, to cut down on travel time to work. The company has also initiated a pilot project for employees giving them an opportunity to opt for a one-year sabbatical at any point in their careers. Many working mothers and to-be-mothers have also been encouraged to work on their projects from their homes. Flexi timing of the working

Chapter 1: Human Resource Management -An Introduction

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mothers also help these techniques. Apart from these, the company also emphasizes on organizing counseling programme for their employees so as to provide solutions for better work life balance. Performance appraisal at Infosys is the evaluation of personal skills for the tasks assigned to an employee during the period of appraisal. The entire organization has restructured its compensation and reward system in order to match the performance of its employees, business needs and the growing scale of operations. The company has a variable pay structure. Salary at Infosys is linked to the topline, performance of the team and performance of the individual. The company also intends to compensate star performers more aggressively than average or poor performers. Infosys has always considered its people as its most valuable assets and fosters innovation and creativity in the workplace. Infosys tried to preserve the attributes of a small company and worked in small groups, with decision-making remaining with those who were knowledgeable about particular processes. The managers played the role of mentors and used their experience to guide their team members.

Human Resource Human resource, known as human capital or intellectual asset, is an organization’s employees/managers’ right from the shop-level workers upto the Board of Directors, described in terms of their knowledge, skill, ability, experience, training, exposure, expertise, judgement, intelligence, relationships, insight and so on.

Figure 1.1: Human Resource

HR is not just a headcount

HR is the skill, ability, intelligence and etc., of employees

Human Resource is not just a head-count i.e. it is not just the number of employees/managers. ¾ It is more of qualitative than quantitative ¾ It is people’s capabilities to drive organizational performance along with money, materials and the management system ¾ It also refers to the productive capabilities of employees, particularly, knowledge, skill and experience that have economic value

Human Resource is not just the number of employees/managers; it is the knowledge, skill, ability, experience, training, exposure, expertise, judgement, intelligence, relationships, insight and so on of the employees/ managers.

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Human Resource Management

Human Resource Management Different authors have defined HRM in different ways but the essence of HRM remains the same. Snell and Bohlander: HRM is the process of managing human talent to achieve an organization’s objectives. Raymond A Noe et al: Policies, practices and systems that influence employees’ behaviour, attitudes and performance. HRM is the process of planning, organizing, directing and controlling the functions of recruitment, selection, training, development, compensation, maintenance and separation of people in an organization keeping in view the goals of the organization / individuals, emerging trends, ethics and fair treatment and financial impact.

Gary Dessler: HRM refers to the practices and policies that are needed to carry out the personnel aspects of managing job, specifically, acquiring, training, appraising, rewarding and providing, a safe, ethical and fair environment for the company’s employees. Bratton and Gold: HRM is a body of knowledge and a set of policies and practices that shape the nature of work and regulate the employment relationship. John Bernardin: HRM concerns the personnel policies and managerial practices and systems that influence the workforce. John M.Ivancevich: HRM is the function performed in organizations that facilitates the most effective use of people (employees) to achieve organisational and individual goals. In a nutshell, HRM may be defined as a process of planning, organizing, directing and controlling the functions of recruitment, selection, training, development, compensation, maintenance and separation of people in an organization keeping in view the goals of the organization/individuals, emerging trends, ethics and fair treatment and financial impact.

Evolution of HRM HRM evolved over a period of years from the era of industrial revolution. The evolution of HRM dates back to 18th century and the concept is very old in nature involving the management of human beings. There were many phases of people management before reaching the current scenario as researched by many authors.

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A brief outline of the various stages of development of HRM is stated below: Industrial Revolution: It started during 18th century in Britain and spread later to Western Europe and United States. Workers were forced to indulge in monotonous and repetitive work activities. Workers were treated earlier as machines and not as resources. The industrial revolution witnessed ill treatment and exploitation of workers. Trade Unionism: Workers joined together to form trade unions to protect their interests. The movement started within the era of industrial revolution as there were common worker demands. The origin of Trade unions can be traced back to 18th century in Europe and later it spread to many other parts of the world. Taylorism or Scientific Management: Scientific management was propounded by Frederick Winslow Taylor in 1911. It aimed to standardize workflows and improve labour productivity through reduction of effort. Human factor at work was given more importance and procedures were simplified by time and motion studies. Human Relations Movement: The concepts of scientific management led to an awareness of improving procedures and productivity through work simplification. In early 1930s the famous research by Elton Mayo et. al. namely, the “Hawthorne Studies” opened up a new horizon of human relations at workplace. It revealed the impact of social factors, informal groups, motivation and employee satisfaction on productivity. This was the beginning of behavioural approaches and soft skill training to employees. The modern concept of HRM sprouted from such movements. Organizational Behaviour & Theory: Other contemporary researchers like Abraham Maslow, David McClelland, Max Weber and others propounded different concepts on organizational behaviour and developed organizational theory. Motivation, leadership, workforce productivity and similar theoretical areas propped up and gained significance. Industrial and Labour Relations: The field of industrial and labour relations started getting importance in many industries as there were strained labour relationships. Legal framework was developed to protect the interest of labour and amicably settle any industrial disputes.

HRM has evolved through various movements, namely, industrial revolution, trade unionism, scientific management, human relations, organizational behaviour and theory, industrial and labour relations and HR approach.

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Human Resource Management

HR Approach: HR rooted itself strongly in the theoretical background of earlier researches backed by support from industrialists and professional associations. The oldest HR association is the “Chartered Institute of Personnel and Development” started in 1913 in England. The Society for Human Resource Management was later formed in 1948 in the United States. The first college level study on HR was from Cornell University, United States. At present, there are umpteen numbers of specialized courses in HRM offered by renowned universities all over the world.

Current Scenario

Figure 1.2: Separate HRM Department

Today, every organization, big or small, is having a separate department to take care of the human resources. The HRM function has become a strategic partner in organization development. Most of the organizations are striving to improve the human resources to realize their avowed objectives. Well known organizations are vying with each other in Figure 1.3: Best Employers – attracting and retaining the best Surveys by Business Magazines human resource talents. Business magazines have started conducting surveys to find out the ‘Best Employer’ emphasizing the need for maintaining a talented pool of employees.

Nature of HRM The nature of HRM is multifaceted. The major aspects are as below: Pervasive Force: HRM permeates all the levels of management, right from shop floor management up to the top management.

Chapter 1: Human Resource Management -An Introduction

Action-oriented: HRM is not just record keeping or concerned with only laying down rules, regulations or procedures. It is highly focussed on getting the things done. It relies more on rational policies. People-oriented: As the term HRM suggests, it is all people oriented at individual, group and organizational level. Future-oriented: HRM is concerned with future. It has to answer the questions such as What will happen to the organization and its people in the absence of proper HRM? How HRM is to be modified for survival in the competitive world?

Nature of HRM: It is allpervasive, action and people oriented, futureoriented, developmentoriented,

integrating

mechanism, interdisciplinary, and continuous function.

Development-oriented: As the very survival of organization depends on the development of human resources, HRM is more focussed on developing people. Integrating Mechanism: Though HRM is an auxiliary function, its role is comprehensive and integrating as the entire organization is run by people. Interdisciplinary: HRM draws heavily from disciplines such as human psychology, sociology, anthropology, economics, law and politics. Continuous Function: As long as the organization exists, HRM continues to be an important function.

Scope of HRM Scope of HRM is the range of aspects HRM deals with. In fact, it is far and wide.

Personnel Aspect This encompasses the following. ¾ Manpower forecasting and planning ¾ Recruitment: ’Selling’ the organisation for prospective employees ¾ Selection: Screening of employees through tests, interview etc. ¾ Placement and Transfer: Putting the right people in the right job.

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Figure 1.4: Scope of HRM

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Human Resource Management

The scope of HRM

¾ Training and Development

includes

¾ Promotion and Rewards

personnel

aspect, welfare aspect, social security aspect, industrial

relations

aspect, HRIS, financial impact, ethics and high performance system.

work

¾ Maintenance: Compensation through incentives ¾ Separation: Voluntary retirements or Superannuation ¾ Lay-offs and Retrenchment

Welfare Aspects These include: ¾ Working conditions ¾ Safety measures ¾ Canteen, Crèches and Rest/Lunch rooms ¾ Housing and Transport facilities ¾ Medical assistance ¾ Education for self and children ¾ Recreation facilities for physical and mental health

Social Security Measures Aspect This aspect covers: ¾ Employees’ Provident Fund ¾ Insurance ¾ Gratuity and Pension ¾ Job for dependents on retirement / death

Industrial Relations Aspect This is related to: ¾ Trade union-Management relation ¾ Labour laws ¾ Collective bargaining Miscellaneous but important functions of HRM: ¾ Human Resource Information System ¾ Financial Impact of HRM ¾ Equal Opportunity, Ethics and Fair Treatment ¾ High Performance Work System to meet the challenges

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Objectives of HRM The objectives of HRM are manifold as shown below: ¾ Utilize the skills and abilities of the workforce efficiently and effectively ¾ Provide well-trained and highly motivated employees ¾ Fulfill the employees’ job satisfaction and self actualization ¾ Develop and maintain a conducive quality of work life ¾ Communicate HR policies to all the employees ¾ Help organisation reach its goals ¾ Create a functional Human Resource Information System ¾ Make the organization globally competitive ¾ Get the organization ready to face future challenges ¾ Give equal opportunity to all ¾ Be ethically and socially responsive to the needs of the society

Objectives of HRM in organizations include skill utilization, training, motivation, self actualization, quality of worklife, HR policies, HRIS, global competitiveness, equal opportunity, ethics and meeting future challenges to achieve global competitiveness.

Functions of HRM HRM functions include many areas.

Functions of HRM in-

Managerial Functions

clude managerial func-

¾ Planning

tions, operative func-

¾ Organizing ¾ Directing ¾ Controlling Operative Functions ¾ Personnel records ¾ Job analysis ¾ Job evaluation ¾ Job design ¾ HR planning

tions

and

emerging issues.

solving

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Human Resource Management

¾ Recruitment ¾ Selection ¾ Placement ¾ Induction and Orientation ¾ Transfer ¾ Training and Development ¾ Career planning ¾ Separation and Retention ¾ Motivation and Compensation ¾ Work Scheduling ¾ Performance Appraisal ¾ Compensation: Salary, Incentives and Benefits ¾ Recognition ¾ Maintenance ¾ Health/Safety ¾ Employee Welfare ¾ Social Security benefits ¾ Integration ¾ Grievances Redressal ¾ Discipline ¾ Teams and Team work ¾ Collective bargaining ¾ Employee participation and empowerment ¾ Trade unions/employees’ associations ¾ Industrial relations Emerging Issues ¾ HR audit ¾ HR research ¾ HR accounting ¾ HR Information System ¾ Counselling ¾ Strategic HRM

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¾ Managing human resources globally ¾ Financial impact ¾ Equal opportunity, ethics and fair treatment

Roles and Responsibilities of HR Manager HR manager plays many different roles and takes up various responsibilities depending on the size of the company, characteristics of the workforce, type of the industry and the value system of the management. In some companies the HR manager takes full responsibility of human resource activities. In some other companies the HR manager may share the roles and responsibilities with managers of other departments such as finance, marketing, operations or systems. There are companies where the HR manager advises top-level management. In many companies, the HR manager makes decisions regarding staffing, training and compensation after the top management’s decision on relevant business issues.

Roles of HR Managers HR manager has many roles to play.

Figure 1.5: Roles of HR Manager

Strategic Partner (SP): Aligning HRM strategies to business strategies to help the company execute its business operations. Administrative Expert (AE): Designing and delivering efficient and effective HRM systems, processes and practices. These include selection, training, developing, appraising and rewarding employees. Employee Advocate (EA): This role entails managing the commitment and contributions of employees. Change Agent (CA): In the present scenario of cut-throat competition companies need to change and develop a capacity to change. In this regard HR managers help identify and manage processes for change.

Responsibilities of HR Managers The responsibilities of HR manager are far reaching: Employment and Recruitment: Recruiting, Testing, Interviewing and temporary Labour co-ordination.

The roles of a HR manager are strategic partner, administrative expert, employee advocate and change agent.

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Human Resource Management

HR manager has to take care of employment and recruitment, training and development, compensation, benefits, employee services, employee and community relations, health and safety, strategy planning and maintenance of personnel records.

Training and Development: Orientation, Performance Management, Skills Training and Productivity Improvement. Compensation: Job Description, Job Evaluation, Wage and Salary Administration, Executive Compensation and Incentives. Benefits: Insurance, Vacation Leave, Retirement Plans, Profit Sharing and Stock Plans. Employee Services: Employee Assistance Program, Relocation Services and Outplacement Services. Employee and Community Relations: Attitude Surveys, Labour Relations, Publications, Labour Law Compliance and Discipline. Health and Safety: Health, Wellness and Safety Inspection. Strategy Planning: International Human Resources, Forecasting, Planning and Mergers/Acquisitions. Personnel Records: Information Systems and all records pertaining to employees.

Competencies of HR Manager Figure 1.6: Competencies of HR Manager

According to Arthur Yeung et al (1994), there are four major competencies required of a HR manager. Business Mastery: HR professionals should know the organization’s business thoroughly, particularly, the economic and financial capabilities, so that they can ‘join the team’ of the mainstream business managers. They must also develop skills at external relations focused on their customers. HR Mastery: HR professionals are expected to be behavioural science experts. They must develop competencies to keep them abreast of changes in the areas of staffing, development, appraisal, rewards, team building and communication. Change Mastery: They must be able to manage change processes for effective merger of HR

Chapter 1: Human Resource Management -An Introduction

activities with the organization’s business needs. They must be conversant with interpersonal and problem-solving skills as well as innovativeness and creativity. Personal Mastery: They must establish personal credibility and trust by developing personal relationships with customers, by demonstrating the values of the firms, by standing up for one’s own belief and by being fairminded in dealing with others.

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Competencies of a HR manager include business mastery, HR mastery, change mastery and personal credibility.

HR Policies Human resource policies are developed by the HR department in tune with the overall organizational policies. It is done in consultation with the top management. The HR policies are systems of codified decisions to support administrative personnel functions. It helps as guidelines to manage performance of employees, allocation of resources and maintaining harmonious employer-employee relations. The policies should clarify the nature of the organization, mutual expectations of top management and employees, organizational procedures, appropriate behaviours, and punishments. Policies help the organization formally spell out the rules and regulations to employees. It helps build an open organizational culture that fosters employee development and maintains better industrial relations.

HR policies are systems

The policies are laid out through a systematic process of need identification, information gathering, examining alternatives, approval of written statements, communication and evaluation. Policies provide direction to the organization and employees on resource allocation. Clear-cut standards and procedures formulated in the policy statements serve as base documents for developing a better HR system in the organization. There will be less or no bias in HR related activities when clear policies are developed in the functional areas like recruitment, compensation, training, performance appraisal and so on.

With appropriate HR

HRM Concepts HRM revolves around a few welfare concepts. Commodity Concept: Earlier, labour was regarded as a commodity and wages were based on demand/supply situation. Governments had not interfered in labour affairs.

of codified decisions to support administrative / personnel functions, allocate resources, and spell out proper behaviours to develop good HR system.

policies and practices an organization can hire, develop and utilize best brains, realize its professional

goals

and

deliver results better than others.

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HRM

Human Resource Management

has

evolved

through various welfare concepts such as commodity concept, factor of production concept, goodwill concept, paternalistic

concept,

humanitarian concept, HR concept and emerging concept.

Factor of Production Concept: As in the case of commodity concept, labour was seen as any other factor of production such as money, materials or land. Workers were treated like tools. Goodwill Concept: Gradually firms realized the importance of goodwill of labour/employees and started looking into welfare measures to maintain a better goodwill. Paternalistic Concept: As the importance of employees and their wellbeing were realized seriously, a fatherly attitude developed. Humanitarian Concept: As a result of Hawthorne experiments, the human concept was given more importance than money and materials. HR Concept: Now, employees are considered as the most valuable asset. Emerging Concept: In the present trend employees are accepted as partners in progress with more emphasis on HR development.

Line versus Staff Aspects of HRM Line managers are involved in accomplishing the organization’s basic goals such as production, marketing, after-sales service, customer relationship etc. (Manager-Production, Manager-Marketing, Customer Relationship Manager). Their functions are the main functions and indispensable.

Figure 1.7: Synergy between HR Managers and Line Managers

Staff managers assist and advise the line managers in accomplishing the basic goals of the organization. Managers in the HRM/HRD department or the Finance department are staff managers. HR managers are generally staff managers. When the HR managers attend to any main function such as training in the training section they become line managers as training employees is the basic function in the training section. However, all managers are, in a sense, HR managers because they all get involved in activities such as recruiting, interviewing, selecting and training. Managers may move from line to staff positions and vice-versa over a period because of their expertise, experience, interest and need.

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Line Managers’ HRM Responsibilities HR and line managers generally share responsibility for most HR activities. The direct handling of people always has been an integral part of every line manager’s responsibility. Line managers’ responsibilities may involve: ¾

Placing the right person in the right job

¾

Orientation i.e., familiarizing the new employees with the jobs and the organization

¾

Training employees (skill development)

¾

Improving employees’ job performance

¾

Encouraging co-operation and interpersonal relationship

¾

Helping employees to interpret organization’s policies, procedures Line managers are involved in accomplishing and programmes

¾

Controlling labour costs

¾

Maintaining morale

¾

Arranging for safety measures

¾

Developing corporate citizenship

¾

Creating conducive working environment

HRM vs Personnel Management

Figure 1.8: Line Manager as HR Manager

the organization’s basic goals such as production, marketing, after-sales service, customer relationship etc. Staff managers assist and advise the line managers in accomplishing the basic goals of the organization.

There are researchers who see no difference between HRM and Personnel Management as there appears to be no difference between “human” and “personnel”. Nevertheless, there are hardcore HR managers who feel that HRM is different from Personnel Management in many ways. Personnel Management

Human Resource Management

Traditional term

Modern term

Activities to manage the workforce

Activities to manage human as resource

Narrow scope

Broader scope

Men are treated as an expense and factor of production

Men are treated as an investment and a resource

The direct handling of people always has been an integral part of every line manager’s responsibility.

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Human Resource Management

More administrative focus

Less administrative focus

Less in tune to the objectives of top management

In tune with the objectives of top management

Strong functional focus

Overall management and development focus

Reactive in nature

Proactive in nature

Full time work

Full time, part time or flexi time work

Taken care by administrative manager or personnel manager in many organizations

Taken care by separate HR department

Organizational goals are given more importance

Both organizational and individual goals are given importance

Mechanistic orientation

Organic orientation

Compartmentalized approach

Total systems approach

Functions are dealt separately

Functions are viewed as interrelated

Importance of HRM An organization’s success depends on three dimensions of employees viz. Knowledge, Skills and Abilities. These dimensions establish a set of core competencies that distinguishes an organization from its competitors. With appropriate HR policies and practices, an organization can hire, develop and utilize best brains, realize its professional goals and deliver results better than others. HRM helps an organization and its employees accomplish their respective goals.

At the Individual Level HRM is more broad, proactive and integrated than personnel management.

¾ It offers excellent growth opportunities to people who have the potential and attitude ¾ It allows employees to work with diligence and commitment ¾ It promotes team work and team spirit

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At the Organization Level ¾ It helps in attracting and retaining the best people ¾ It alerts the firm, through forecasting the types of people required in the short, medium and long run. ¾ It comes handy in training people for challenging jobs ¾ It develops right attitude toward the job and organization ¾ It promotes loyalty and commitment through appropriate reward schemes

At the Society Level ¾ It improves employment opportunities ¾ It puts the scarce talents to best use

At the National Level

HRM process includes job analysis/job design, HR planning, recruitment, selection, training and development, performance appraisal, compensation, career development and separation.

¾ Efficient and effective use of human resources helps in usage of natural, physical and financial resources in a better way ¾ People with right attitude, appropriate values and proper skills help the nation compete with the best in the world ¾ Proper HRM with HRD results in better standard of living Further, good HR practices result in the following: ¾ Attract and retain best talent with less attrition ¾ Train people for challenging roles ¾ Develop skills and competencies ¾ Promote team spirit ¾ Develop loyalty and commitment ¾ Increase productivity and profitability ¾ Improve job satisfaction ¾ Enhance standard of living ¾ Generate employment opportunities

Process of HRM HRM involves many important activities such as job analysis/ job design, HR planning, recruitment, selection, training and development, performance appraisal, compensation, career development and separation.

Figure 1.9: Process of HRM

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Human Resource Management

Review Questions

Review Questions Answer in brief 1. What is Human Resource?

8. What are the operative functions of HRM?

2. Define Human Resource Management?

9. Distinguish line managers and staff managers.

3. What is meant by HR policies?

10. How important is HRM at an individual level?

4. What are the personnel aspects of HRM? 5. What are the welfare aspects of HRM? 6. What are the social security aspects of HRM?

11. How important is HRM at the organization level? 12. How important is HRM at the society level?

7. What are the industrial relations aspects of HRM? Answer in detail 1. Describe the evolution of Human Resource Management. 2. Explain the nature of HRM. 3. What is the scope of HRM? 4. Discuss the competencies needed for a HR manager. 5. Explain the objectives of HRM. 6. Discuss the concepts of HRM. 7. Discuss the role of HR manager in detail.

8. Analyze the responsibilities of HR manager. 9. Elaborate the various functions of HRM. 10. Discuss the HR responsibilities of line managers. 11. D i f f e r e n t i a t e H R M f r o m P e r s o n n e l management. 12. Why HRM is important in today’s competitive environment?

Specialists Speak

Specialists Speak Specialists Speak - 1

Nagarajan Balanaga Vice President - HR, Cummins Group, India

Are HR personnel free from the shackles of the administration? In much the same way as Charles Darwin’s theory of evolution, the role of HR professionals in organisations has evolved dramatically over the years. Traditionally, the role of HR professionals has been primarily administrative in nature; often bucketed along with other support functions such as

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finance, IT and compliance. However, changing market dynamics and global competitive pressures have necessitated companies to revisit their entire people strategy, thus in turn leading to a reorientation of the HR function itself. Today, with the macroeconomic fundamentals within which companies operate being equal, HR leaders are required to don the role of strategic advisors to create a differentiated culture, thus coming a long way in transforming themselves from a support function to an advisory one. With growing economic uncertainty, globalisation and a dynamic competitive business ecosystem, people have emerged as the biggest assets of an organisation, with the HR function as the custodian. Given the changing times, HR has gradually broken away from the constraints of an administrative function limited to managing contract labour, canteen, transport, benefits, etc, to playing a more strategic role aligned to business strategy, and influencing the company’s business performance, overall wealth generation and sustainable growth. However, in India, a mere 30 per cent of the top-performing organisations view HR personnel as strategic business partners collaborating to achieving organisational growth, committed to upholding the company’s values, culture and ethics; striving towards diversity and grooming future leaders. No doubt, these are the companies that often earn themselves the reputation of being a ‘Great Place To Work’, wherein HR leaders act as catalysts of change by deploying effective strategies, tools and processes, thus creating a value and culture that invests in its people. Therefore, as we move away from a capital-intensive economy to a knowledge-intensive one, it is becoming increasingly important to separate the administrative processes from the integrated people processes. As a result, HR leaders are moving away from obsolete administrative tasks and instead focusing on understanding the organisation and its future direction, effective people relationship management and value creation. Furthermore, as the war for talent intensifies, HR personnel are posed with new challenges such as a growing shortage of employable talent and managing workforce aspirations. Therefore, they need to be equipped with the right skill-set and competencies including business acumen, industry expertise, and ability to mentor and coach managers to act like good bosses offering meaningful work and driving effective engagement, thus creating value for themselves and their stakeholders. Another aspect worth investing in is the integration of people processes with the right technologies. Today, many organisations are failing to leverage the full potential of technology. While HR leaders have come a long way and found a place in corporate boardroom discussions, a large percentage of companies still consider HR as a mere administrative function, thereby ignoring the changing dynamics at the workplace and the current requirements for success. Freeing HR from the shackles of administration is fundamental to building robust organisations that create value on a sustained basis. (Source: http://itsmyascent.com/cms?targeturl=web%2Fitsmyascent%2Fhr-zone%2F %2Fasset_publisher%2FzM4i%2Fcontent%2Ffreedom-for-hr)

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Human Resource Management

Specialists Speak – 2

Baba Shiv Professor - Marketing & Director Strategic Marketing Management Executive Program, Stanford Graduate School of Business

The Challenge of Critique Some feedback-generating processes, if carried out well and rather unconventionally, can lead to innovation. In my work with corporate, entrepreneurial, and student teams, I’ve found that if you want to create a culture of innovation, you have to learn to give productive feedback. In getting people to solve problems, you don’t want to create more of them. In a feedback-generating mechanism, it’s important to keep delving deeper until they arrive at a place where you can feel the emotion in their response. This may be as lofty as some version of ‘I want to impact the world’ or as personal as ‘I want to be a success and be able to call my own shots’. But it needs to move from the head to the heart. Getting them in touch with what is most deeply meaningful to them about their project will make it less likely that they will get defensive later. It sends the signal that you are on their side, and that allows them to frame your comments as help rather than criticism. The bottom-line is that when people are putting their ideas out there, you need to establish safety if you want them to stay on the innovative track. Why? Behavioural science shows that when people are stressed, their brain sends them on a beeline toward seeking comfort. This is not the time when they will be open to creative thinking; rather, they will be shutting down and sticking to the tried-andtested. In contrast, if you take the stress out of the situation, they can flip over to the other major neural pathway: the one that moves them from boredom to excitement. That’s the groove you want to get them on when you’re critiquing their work. When people are calm and not stressed, they’re better able to see critique as an exciting challenge than a failure.When people are in a ‘challenge’ rather than ‘failure’ mindset, they become like kids playing a videogame: 80 per cent of the time they’re not able to find a solution, but when they do, the hugely emotional ‘Aha!’ that comes along with it can become addictive. Sometimes, the problem is that people are so excited about their ideas that they become blind to the seriousness of the problems you’re pointing out. In that case, I use the technique called ‘pre-mortem’. Unlike a postmortem, in which you dissect why something has failed, with a pre-mortem, you ask the person or team to gaze into the crystal ball two years from now, when the venture has failed, and ask them to think creatively about what could have given rise to that. In this exercise, I often find they identify the cause of failure to be related to the professional (or sometimes personal) shortcomings of one or two people on the team, rather than outside issues such as strategy or money. Normally, these trickier issues don’t see the light of day. But in this lower-stakes hypothetical forum, they’re more likely to emerge as opportunities for change.

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The next phase is to ask the person or team to solve the problems that led to the failure. This allows the meeting to end on a positive note. It’s critical to realise that when the brain goes through an experience that spans time and has many ups and downs, it’s the last event that sets the tone for how the entire experience is viewed.Also, it’s vital that you conclude the feedback session by reframing problems as challenges, and by affirming that the experience has been constructive and helpful. Remind everyone about their bigger dream. (Source: http://itsmyascent.com/cms?targeturl=web%2Fitsmyascent%2Fhr-zone%2F%2Fasset_publisher%2FzM4i%2Fcontent%2Fthe-challenge-of-critique)

Case Study

Case Study Case 1

The Information technology (IT)-enabled Services (ITES)-Business Process Outsourcing (BPO) industry is considered to be India’s flagship sunrise industry, playing a major role in transforming the country from a slow-growth economy with recurring balance of payments problems to a fast-growth economy generating foreign exchange surpluses. It is also argued that the boom in ITES-BPO activities is instrumental in resolving the crisis of unemployment among the growing mass of educated-unemployed in the country. Call centres in India are broadly classified under ITES– BPO category. Roughly 6065% of ITES-BPO services fall within the call centre spaces and 35-40% are back office activities. Major established call centre hubs in India are located in Bangalore, Mumbai, and in the National Capital Region of Delhi. Now new IT-BPO hubs are emerging in Pune, Kolkata, Chennai and Hyderabad. Most of the work is routine call centre and back office processing work for the US, UK, Australian and domestic markets. The ITES-BPO in not only a new sector of employment, but the nature and structure of employment in this sector is also largely new to India. Therefore the unionization in the ITES- BPO sector becomes a challenging task. Although the labour laws of the land apply to the ITES-BPO sector, various exemptions from crucial labour laws have been granted to the sector by the government. The ITESBPO sector is exempted from application of the Apprentice Act. This exemption provides the sector with the opportunity to engage large number of workers as apprentices without any obligation to absorb them as regular workers or provide them with any social security benefits. The state governments of Karnataka, Tamilnadu, Maharastra, etc. have exempted IT establishments and IT-enabling services from the provisions of the Shops and Commercial Establishments Act related to working hours; and from prohibitions in the Act against night work for women and young people, subject to employers providing transport and security for those working at night. West Bengal’s IT Policy allows BPO/ITES employers ‘self-certification’ of their compliance with important labour legislations like the Minimum Wages Act, Shops and Commercial Establishments Act, Workers’ Compensation Act, and Employees State Insurance Act. Andhra Pradesh’s Policy on IT also grants similar exemptions. The IT Policy of

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Human Resource Management

Uttar Pradesh exempts ITES from routine inspections in relation to compliance with labour and pollution regulations. In 2009, the Karnataka government provided exemption to IT/ITES and software establishments from the provisions of Industrial Employment (Standing Orders) Act 1946 for two years. This Act provides for strict enforcement of provisions on classifying workers, their working hours and shifts, the wages payable, etc. Haryana Labour Policy declared the IT and ITES sector as Public Utility Services in 2006. Some other states have also made this declaration. Moreover, more and more IT and ITES units are now moving in the Special Economic Zones (SEZs) where all the activities are declared as Public Utility Services under the Industrial Disputes Act; for workers in Public Utility Services, a legal strike is almost impossible. About 50% of SEZs are especially for IT and ITES. As of September 2010, the Government of India has approved 734 SEZs to be established in different states of India. (367 out of 734 approved SEZs are already notified – either land has been already acquired for them or it is in process. 122 out of these 367 notified SEZ have already become operational.) Working Conditions in BPOs The workers in the BPOs are generally called agents. Over 80% of BPO workers are in the age group of 20-25 years. Women workers (mostly unmarried) roughly constitute 40-50% of the workforce. Workers are generally recruited as probationers for 6-12 months. Only a very small portion of these probationers are absorbed as regular workers. Studies have reported that as high as 38% workers in BPOs are probationers (workers on probation for up to one year before being formally hired as regular workers) or on project-based engagement (only 62% are permanent workers). Moreover, in the BPO sector, permanent status cannot be equated with job security. The permanent workers are also thrown out of their jobs as easily as the temporary workers. The only difference between the two categories of workers is that permanent workers get social security benefits and leave entitlements, etc. Studies have found a very small portion of workers working in the BPOs for more than two years; the attrition rate in the BPO sector is as high as more than 50%. It reflects on the high insecurity and vulnerability of BPO workers. There are also the pull factors, but the main contributor in the high attrition rate is the push factor and not the pull factor. In India BPO workers are comparatively better paid than other industrial sectors. The monthly salary of BPO workers ranges from Rs. (Indian rupees) 8,000 to Rs. 15,000 (equivalent to US$178-US$334). The major problem that BPO workers face is that they are virtually compelled to work like slaves. Using Automated Call Distribution (ACD) technology (along with providing standard scripts to facilitate the agent’s response) the firms keep the ‘free time’ between calls to the barest minimum. Moreover, the workers and their work are continuously monitored with the help of specially designed software and closed circuit cameras. This monitoring is not only at the workplace but also outside the workplace. The workers are always under psychological pressure. The other major problem is difficulty in getting leaves. The regular workers also cannot go on leave without prior permission, even when they are facing sickness. However, they are eligible for 10-11 days of leave in a year. But probationers or other temporary workers who form almost 40% of the workforce are not eligible for any leaves except casual leaves. Moreover BPO workers, whether regular or temporary, do not get any leave on national holidays and festivals. The issue of leaves is so crucial that sometimes it becomes a reason to resign. Unnatural working hours, a heavy workload, excessive overtime, continuous monotonous work without

Chapter 1: Human Resource Management -An Introduction

25

rest, and working under continuous psychological pressure cause serious health problems ranging from nervousness, chronic fatigue, body ache, insomnia, nausea, anxiety, restlessness, irritability and depression, to digestive problems such as constipation, peptic ulcer, indigestion, diarrhea, excessive gas formation, abdominal pain, etc. The individualized work culture and lack of space for social interactions either at the work centre or in society (due to odd timings), is making them asocial individuals detached from society. This is a major cause of depressions. Moreover, they also face a problem of split personality – they live in a ‘foreign’ world with foreign names and foreign culture at night, and as poor natives facing a lot of trivial problems in the daytime. If the work culture in manufacturing units automatically teaches the workers to work collectively and therefore automatically transfers in them a collective feeling and some sorts of organizing skills, the BPO culture automatically teaches the opposite and automatically transfers individualistic feelings. Probably this is also one of the reasons why they are more hesitant to join organizing efforts. But there is another aspect of this situation also – i.e. BPO workers feel comparatively more urge to socialize and join gatherings, etc. Questions: 1.

Critically examine the IR Climate in Services Sector with special reference to BPO industry in India. (20 marks)

2.

”In service industry like BPO, HRD is more relevant than IR”. Comment

(All India Management Association Ph.D Exam, June 2012)

Case 2 Rajat Sharma has been employed for six months in the Accounts Section of a large manufacturing company in Faridabad. You have been his supervisor for the past three months. Recently, you have been asked by the Management to find out the contributions of each employee in the Accounts Section and monitor carefully whether they are meeting the standards set by you. A few days back you have completed your formal investigation and with the exception of Rajat, all seem to be meeting the targets set by you. Along with numerous errors, Rajat’s work is characterized by low performance – often he does 20 percent less than the other clerks in the department. As you look into Rajat’s performance review sheets again, you begin to wonder whether some sort of remedial training is needed for people like him. Questions: 1.

As Rajat’s supervisor can you find out whether the poor performance is due to poor training or to some other cause?

2.

If you find Rajat has been inadequately trained, what will be the strategy you will use to provide remedial training programme?

3.

If he has been with the company for six months, what kind of remedial programme would be the best?

Human Resource Management

26

4.

Should you supervise him more closely? Can you do this without making it obvious to him and his co-workers?

5.

Should you discuss the situation with Rajat?

(Karunya University, April / May 2010)

Classroom Project

Classroom Project

Divide the students into small groups of 5-6 members and assign each group to a large firm. Let the groups collect all the details of the activities of the HRM departments. They are discussed in the class to find out the best firm as far as HRM activities are concerned. They can also discuss the HRM practices of the top 50 ‘Best Companies to work with’ (Business India, Business Today Survey).

Field Project

Field Project

The students are divided into many groups (each group with 4 or 5 students). The groups are assigned to various firms in different industries. Each group has to collect the following information from the firms: Does the firm have a separate HRM department? If no, ¾ Why the firm does not require a separate HRM department? ¾ What are the compelling reasons for not having a separate HRM department? If yes, ¾ How many are working in the HRM department? ¾ What is the approximate annual budget allocation for the department? ¾ Who is heading the department (VP, GM, Senior Manager or HR Manager)? ¾ What are the criteria (qualification/experience) required to get into the entry level in the HRM department? ¾ What are the major HRM activities the department undertakes (Performance Appraisal, Training and Development, Career Planning etc.)? ¾ Are the employees happy and proud of working in the HRM department? The data are tabulated and presented in the class room for discussion and interpretation.

Job Analysis and Job Design • • • • • • • • • • • • • • •

Key Terms Job Analysis O*NET Job Description

Job Design Employee Empowerment

Employee Teams Flexible Work Schedule

• • • • • •

HRM - Indian Perspective Job Analysis Methods of Collecting Job Analysis Information Techniques involved in Job Analysis O*NET and Job Analysis Approaches to Job Analysis Questions to be answered in Job Analysis Why to do job Analysis? Competency Models and Job Analysis Job Description Job Specification Job Design Job Design: Approaches and Outcomes – A Different Thinking Trade-offs among Approaches to Job Design Designing Work for Groups / Teams Flexible Work Schedules Review Questions Specialists Speak Case Study Classroom Project Field Project

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Human Resource Management

HRM – Indian Perspective

Tata Steel

Tata Steel Limited

Shri. B.Muthuraman, Former MD & Vice-Chairman

Tata Group of Companies is one of the largest and most respected business conglomerates in India, founded by Jamsetji Tata in 1868. The group comprises over 100 operating companies in seven major business sectors. Tata Steel group, a prestigious member of Tata group is the world’s second most geographically diversified steel producer, employing around 80,000 people across five continents in nearly 50 countries. Tata Steel is among the top ten steel manufacturers in the world. It was established in Jamshedpur, India, in 1907. Tata Steel has always endeavoured to offer some of the best HR practices, and the recruitment process is no exception. The Tata Steel Management Trainee Programme and the Corus Graduate Programme continue to attract and offer exciting career options to young engineers who are from amongst the best colleges of the country. The company does shadow recruitment for niche senior talent. Tata Steel is of the opinion that people are its greatest asset and has therefore adopted the best practices for its employees. To bridge functional skill gaps and to identify candidates for focussed learning in line with the current and future needs of Tata Steel, a scheme called ‘Directed Learning Initiatives’ is adopted in Tata Steel. Trade unions are present and encouraged at all locations.Tata Steel is a pioneer of joint consultation in India. A minimum of 56 Joint Departmental Council meetings are held in a year. Grievances and complaints of employees at Tata Steel are handled through well-defined and user friendly mechanisms in order to redress them at the initial stages. The informal grievance resolution mechanism is an online process and goes by the name of “Samadhan”. The formal grievance resolution is divided into three stages, with each stage being reached when a solution is not arrived in the previous stage. These are further referred to the Central Works Committee. Tata Steel has many ‘firsts’ in the area of employee welfare. The Steel Works is the only steel manufacturing unit and the largest of its kind in the world, to adopt and enforce SA 8000 as a tool to improve workplace standards. Apart from continuous preventive health surveillance of employees, a unique programme on Wellness@Workplace prevails across the company. Monetary incentives are given to employees acquiring higher technical qualifications in a related field. Tata Steel encourages a holistic approach to learning and development through

Chapter 2: Job Analysis and Job Design

its well established in-house training facilities and approaches. The Tata Steel Management Development Centre (TMDC) endeavours to provide primarily managerial training and also functional training to all officers of Tata Steel, the Shavak Nanavati Technical Institute (SNTI) provides the essential technical and functional training to all officers and non-officers of the Company. There is a Performance Improvement Committee to focus on improving both knowledge management and the adoption of best practices across the Tata Steel Group. A greater focus is given to ‘On-the-Job Learning’ for executives. There are executive committee and talent review committees to develop succession plans. The Company sends senior executives to world-class leadership development programmes at some of the world’s leading management development institutes. A Global Leadership Development Programme was also initiated with the objective of shaping future Tata Steel Group leaders across the globe. The company ensures the development and growth of its employees in the best possible ways through the following steps: 70:20:10 Learning and Development Programme: The 70:20:10 concept of Learning and Development of officers creates a culture where every manager takes ownership for the development of his/her subordinates. 70% of Learning and Development takes place from real life and on-the job experiences, tasks and problem solving. 20% of Learning and Development takes place through coaching, mentoring, discussions, guidance by superiors/experts. 10% of the learning comes from formal Class Room Training. Job Rotation and Career Planning: In order to eliminate drudgery and maximise the learning opportunities for employees, robust processes have been put in place pertaining to job rotation and career planning. Employee Contact Programme: A formal method for collecting and resolving officers’ inputs, named “Employee Contact Programme”, is operational from 2009 to capture employee concerns on an on-going basis. Ensuring Development and Growth of Employees (EDGE): The Performance Management System called ‘EDGE’ aligns the activities and behaviours of individuals with company’s corporate objectives and values and supports a culture of excellent superior-subordinate relationship.It’s their belief that businesses should provide and maintain equal opportunities irrespective of caste, creed, gender, race, religion, disability or sexual orientation. The core principles enshrined in the policy, and now applied across the Tata Steel Group worldwide are equality of opportunity, continuing personal development, fairness, mutual trust and teamwork. There are a number of initiatives for women which work under the umbrella of SWATI, the women empowerment cell of Tata Steel. They have self-development programmes such as Pehchan, Empowering Women Managers to Succeed and other developmental programmes. To deal with the challenges of managing a global workforce, their HR policies are customised to local requirements as well as global requirements. To manage global requirements, a compensation policy which covers security, political and economic risks of the location and based on which, mobility premium is inbuilt into the compensation structure.

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Human Resource Management

Before the HR department embarks upon planning for recruitment and selection of employees, it has to do a thorough analysis of the jobs involved in the company taking into consideration the type of business, basis of competition and expansion plan.

Job Analysis Job

analysis

is

the

process of obtaining information about jobs by

determining

the

duties, tasks or activities of jobs. This includes job descriptions and job specifications.

Job: It is a group of related activities Position: A position consists of different duties and responsibilities performed by only one employee Job Family: It is a group of individual jobs with similar characteristics Job Specification: It is a statement of the needed knowledge, skills and abilities of the person who is to perform the job Job Description: It is a statement of the tasks, duties and responsibilities of a job to be performed Job Analysis: It is the process of obtaining information about jobs by determining the duties, tasks or activities of jobs ¾ Job analysis involves job descriptions and job specifications ¾ Job analysis is done by systematically investigating jobs through a number of pre determined steps ¾ Ultimately this results in a report obtained from the analysis of 2030 individual job tasks or activities ¾ The information are used to develop job descriptions and job specifications ¾ These information, in turn, are used to perform and improve various HR functions, specifically performance appraisal criteria or the contents of training programme ¾ The ultimate goal of job analysis is to improve organizational performance and productivity While job design reflects subjective opinion about the ideal requirements of a job, job analysis is concerned with objective and verifiable information about the actual requirements of a job. Job descriptions and job specifications obtained through job analysis must be as accurate as possible to make HRM decisions more effective.

Chapter 2: Job Analysis and Job Design

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Figure 2.1: Job Analysis Process (Snell and Bohlander, 2007)

Job analysis process includes

job

data,

sources of data, methods of

collecting

data,

description of tasks, HR functions and specification

of

qualities

needed to do a job.

Methods of Collecting Job Analysis Information The HR managers usually collect job analysis data from several job incumbents using questionnaires and interviews. From the information collected, appropriate interpretations/inferences are made.

Techniques involved in Job Analysis The techniques or tools involved in job analysis are discussed below:

Figure 2.2: Steps in Collecting Job Analysis Information

Job analysis data is collected from several job incumbents using questionnaires and interviews.

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Human Resource Management

Job Performance: This method is used for jobs that can be relatively learned in a short period of time. The actual job tasks are studied along with physical, environmental and social demands of the job.

Figure 2.3: A Woman at Work

Figure 2.5: An Employee Filling up a Structured Questionnaire

The techniques involved in job analysis are job performance, interviews, structured questionnaires, observations, critical incidents and diaries/logs.

Interviews: The job analyst questions individual employees and managers about the job under review. The respondents are expected to be thoroughly knowledgeable about the job. Though it is the most widely used method for determining a job’s duties and responsibilities, there are chances of distorted information due to outright falsification or honest misunderstandings. Employees may view interviews as efficiency evaluations and hence may tend to exaggerate certain responsibilities. Figure 2.4: A Manager Structured Questionnaires: Interviewing a Worker Carefully designed questionnaires are circulated to be filled out individually by job holders and managers. The information collected pertain to areas of job duties/tasks performed , purpose of the job, physical setting, requirements for performing the job such as skill, education, experience and physical and mental demands, equipments and materials used and special health and safety concerns. A typical job analysis questionnaire may have several open-ended questions as well as structured questions. Observation: The details of a job can be understood by observing and recording on a standardized form. Some organizations may use standardized form. Some organizations may use videotaping also. It is more useful when the jobs consist mainly of

Figure 2.6: A Manager Observing a Woman at Work

Chapter 2: Job Analysis and Job Design

33

observable physical activity than when the jobs involve immeasurable mental activity. Diaries and Logs: The workers are required to maintain diary/logbook or list of activities of what they do during a day. The worker records the activity in a log book. This can produce a complete picture of the job especially when supplemented with subsequent interviews. Critical Incidents: The behaviours of job incumbents are monitored and measured in this method. Important incidents handled by the job holder is gathered and categorized to create a job profile.

Figure 2.7: An Employee Maintaining a Diary on Job Activities

The following are the advantages and disadvantages of job analysis methods: Method

Advantages

Disadvantages

Job Performance

There is exposure to actual job tasks as well as external demands

Suitable only for jobs that can be learned in short period of time

Interviews

· Provides information on standard as well as non-standard and mental work

· Interviewers may be looked with suspicion

· Since job performer responds, more authentic information can be obtained

· Distortion of information may occur

Structured questionnaires

· Cheaper and quicker method · Can be completed off the job · Web surveys can cover large no. of people

Misunderstandings may occur in the questionnaire Response may be poorThere is a chance for less cooperation

Observation

Can get a deeper understanding of job requirements

Less suitable for knowledge work as observation may not reveal useful information

Critical Incidents

· Provides insight into job dynamics · More reliable as behaviours are observed and measured

· Time-consuming · Difficult to develop a profile of average job behaviour

Diaries and Logs

Can be detailed as the incumbent himself/herself fills up data

Bias may be present

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Human Resource Management

O*NET collects and publishes data of job descriptions including skills, abilities, knowledge, tasks, work activities and experience of different occupations in U.S.

O*NET and Job Analysis The US department of labour published the Dictionary of Occupational Titles (DOT) for many years which contained standardized descriptions of about 20,000 jobs. DOT helped bring about a great degree of uniformity in the job titles and descriptions used nationwide. Later DOT was replaced with O*NET online database. O*NET includes 3,500 additional occupations over DOT. The job descriptions include skills, abilities, knowledge, tasks, work activities and experience. To remain current with occupational change O* NET collects and publishes data continuously.

Figure 2.8: O*NET Content Model (Peterson et al.,1999)

Approaches to Job Analysis Details on job content are the base for many HR practices. Various job analysis approaches are available to gather data, each with some merits and demerits. Functional Job Analysis: This method, developed by the US training and employment service, utilizes an inventory of the various types of functions or work activities of a job. This approach assumes that each job involves three broad worker functions viz. data, people and things.

Chapter 2: Job Analysis and Job Design

Position Analysis Questionnaire System: It is a quantifiable data collection method covering 194 different worker-oriented tasks. With a five-point scale, the PAQ seeks to determine the degree, if any, to which the different tasks or job elements, are involved in performing a particular job. The results obtained with the PAQ are quantitative and can be subjected to statistical analysis. It also permits dimensions of behavior to be compared across a no. of jobs and permits jobs to be grouped on the basis of common characteristics. The Critical Incident Method: Under this method, important job tasks are identified for job success. The object of this method is to identify critical job tasks. Critical job tasks are those important duties and responsibilities performed by the job holder that lead to job success. ¾ Information about critical job tasks can be collected through interviews with employees or managers or through self-report statements written by employees. ¾ After data collection, the analyst writes separate task statements that represent important job activities. ¾ Generally the job analyst writes 5-10 important task statements that are clear, complete, and easily understood by those who are not familiar with the job. ¾ This method teaches the analyst to focus on employee behaviours critical to job success. Task Inventory Analysis: Pioneered by the U.S. Air force to analyze jobs held by Air Force specialists, this is an organization-specific list of tasks and their descriptions used as a basis to identify components of jobs. ¾ While PAQ uses a standardized form to analyze jobs in different organizations, TIA can be tailor-made to a specific organization. ¾ The technique is developed by identifying a list of tasks and their descriptions that are components of different jobs. ¾ The objective is to produce a comprehensive list of task statements that are applicable to all jobs. ¾ The task statements are listed on a task inventory survey form to be completed by the person analyzing the job under review. ¾ The job analysis also notes the importance and frequency of use of the task to the successful completion of the job.

35

Various approaches to job analysis are functional job analysis, position analysis, questionnaire system, critical incident method, task inventory analysis and Fleishman job analysis system.

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Human Resource Management

Fleishman Job Analysis System: The system is based on taxonomy of abilities that adequately represent all the dimensions relevant to work. It includes 52 cognitive, psychomotor, physical and sensory abilities. It consists of descriptions of the ability followed by behavioural benchmark examples of different levels of ability on a 7-point scale. The ratings provide an accurate picture of the ability requirements of the job.

Questions to be Answered in Job Analysis The following questions as suggested by Cascio (2008) are to be answered in the job analysis: ¾ Who specifies the content of each job? ¾ Who decides how many jobs are necessary? ¾ How are the interrelationships among jobs determined and communicated? ¾ What are the number, design and content of jobs from the perspective of the entire organization? ¾ What are the minimum qualifications for each job? ¾ What should training programs stress? ¾ How should performance on each job be measured? ¾ How much is each job worth?

Why to Do Job Analysis? Job analysis provides a deeper understanding of the behavioural requirements of jobs. It is the basis for job-related employment decisions. Legally, it plays a crucial role in the defense of employment practices (selection, performance appraisal, promotions etc.). Job analysis helps a lot in the following domains: Organizational Structure and Design: Clear-cut job requirements and inter-relationship specify responsibilities at all levels thus promoting efficiency and minimizing overlap or duplication. Workforce Planning: Job analysis is the foundation for forecasting workforce need. It is also useful for planning, training, transfer or promotion. Nowadays, job analysis information is incorporated into HR information system (HRIS).

Chapter 2: Job Analysis and Job Design

Job Valuation and Compensation: It is used for ranking of jobs in terms of their overall worth and for comparing with jobs of other firms for pay fixation. Job analysis is a must for job evaluation and compensation decisions. The important components of job analysis viz. job descriptions and job specifications are essential. Recruitment: It is needless to state that a complete knowledge of job(s) in question and personal characteristics needed is a must for meaningful recruitment.

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Job analysis helps in designing organizational structure, planning workforce, job evaluation, compensation, recruitment, selection, placement, orientation, training, development, performance management,

Selection: Selection is based on forecast of job performance. What is expected of a person to do a job should be clear in formulating job-related interviews or test questions.

planning career paths,

Placement: To place the right person in the right place, job descriptions and job specifications help to a large extent.

vocational

Orientation, Training and Development: For effective training and development programmes, job description and job specifications are highly valuable. Performance Management: To differentiate effective employees from ineffective employees it is important to specify critical and non-critical job requirements. Job analysis accomplishes this by identifying performance standards. Career Path Planning: For effective career path planning, a thorough understanding of the requirements of available as well as succeeding jobs is necessary. Labour Relations: For contract negotiations between the management and unions and also for resolving grievances and legal disputes the information obtained through job analysis is very helpful. Engineering Designs: In the case of designing equipments to perform specific tasks efficiently, an understanding of the capabilities of the operator and what is expected of the operator is very essential. Job Design: Designing a job with focus on tasks to be done and behaviours expected of the employees doing the tasks requires a good job analysis. Safety: Job analysis looks into the unsafe conditions (environmental as well as personal) to improve safety measures.

maintaining

labour

relations, engineering designs, job design, safety, guidance,

counseling and classifying jobs.

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Human Resource Management

Vocational Guidance and Counseling: Comprehensive job descriptions and job specifications help employees make appropriate decisions on career choices. Job Classification Systems: Job analysis is a must to classify jobs and to form ‘job families’. Determining the structure of relationships among jobs in an organization is not possible without a valid job analysis.

Competency Models and Job Analysis Competency models are a form of job analysis that focus on the full range of KSAOs, i.e. Knowledge,

Skills,

Abilities and Other characteristics such as motives, traits, attitudes, personality and etc. of individuals to be used in HR practices.

Job description is a list of the tasks, duties and responsibilities that a job entails. It is a written statement of what the job holder does, how he does it and under what conditions the job is performed. It includes job title, duties and identification.

Competency models try to identify variables related to overall organizational fit. It identifies personality traits consistent with the organization’s vision such as drive for results, persistence, innovation and flexibility. Competency models are a form of job analysis that focuses on broader characteristics of individuals to be used in HR practices. These models focus on the full range of KSAOs i.e., knowledge, skills, abilities and other characteristics such as motives, traits, attitudes, personality and etc as KSAOs are necessary for effective performance on the job. They also characterize exceptional performers. This type of model consists of a set of competencies that have been identified as necessary for successful performance. How does competency model differ from job analysis? Competency modeling includes a substantial effort to understand an organization’s business context and competitive strategy. It also tries to establish a direct relationship between individual competency requirements and the broader goals of an organization. On the other hand, job analyses do not make this relationship but enable the organization to withstand the close scrutiny of a legal challenge because of the documentation. Hence, competency modeling is not a substitute for job analysis.

Job Description Job description is a list of the tasks, duties and responsibilities that a job entails. It is a written statement of what the job holder does, how he does it and under what conditions the job is performed. The manager uses the information contained in job description to write a job specification. Job descriptions are useful to both the employees and the employer. From the employees’ view, it helps them learn their job duties and remind them of the results expected. From the viewpoint of employer, written job

Chapter 2: Job Analysis and Job Design

descriptions can serve as a basis for minimizing the misunderstandings that occur between managers and the employees concerning job requirements. There is no standard for job descriptions. They tend to vary in content from one organization to another. However, any job description will contain the following three sections:

Job Title ¾ It is of psychological importance to employees as it provides a status (e.g., calling the ‘garbage collector’ as ‘sanitation engineer’). ¾ The title should provide some indications of the duties of the job holder (e.g., Electronics Assembler, Sales Executives or Production Engineer etc.) ¾ It should also indicate the relative level of the position in the hierarchy of the organization (Lab Assistant, Junior Engineer, Senior Manager or Vice-President etc.).

Job Identification Job identification usually follows job title. It includes items such as departmental location of the job, the person to whom the job holder reports and the date of the job description last revised. It may contain a payroll or code number, number of employees in the job and the number of employees in the department. ‘Statement of the job’ which distinguishes the job from other jobs usually appears at the bottom of the section.

Job Duties or Essential Functions ¾ Statements of job duties are arranged in the order of importance. ¾ The statements should indicate the importance or value of each duty. ¾ Usually the importance of a duty is gauged by the percentage of time allotted to it. ¾ The statements should stress the responsibilities of all the duties and the results they are to achieve. ¾ In case of certain technical jobs, the tools and equipments used are also indicated.

Figure 2.9: Components of Job Description

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Human Resource Management

¾ It must be remembered that the job duties section must comply with law by listing only the essential functions of the job to be performed.

Problems with Job Descriptions Though job descriptions are a valuable tool to perform HRM functions, there are several problems. ¾ Job descriptions written vaguely without specific terms will not provide any guidance to the job holder. ¾ Sometimes they are not updated when job duties or specifications change. This does not serve the desired purpose. ¾ Including specifications not related to job may violate the law. ¾ Many a time job descriptions tend to limit the scope of the activities of the job holder. This reduces organizational flexibility. ABCD COMPANY LIMITED Computer Technician Job Description Job Title Reporting to Department Job Type Location

: : : : :

Computer Technician IT Manager IT Part Time

Duties and Responsibilities: 1. Ensuring proper function of users’ computer, software and any peripherals 2. Be able to listen to any customers’ problems patiently 3. Maintain the quality of teaching and assistance 4. Perform test to customers’ computer and find out what’s wrong 5. Update and install computer’s peripherals and software 6. Update and install server 7. Ensure the administration, security and maintenance of the hardware 8. Diagnose, specify and treat the problems in customers’ computer 9. Write various procedures and technical documents 10. Provide any user supports for any equipment and software 11. Maintain the web-based programs 12. Assist in preparing procedures for reporting 13. Maintaining procedures for logging 14. Upholding and monitoring computer’s performance statistic 15. Documenting any hardware failure 16. Documenting any hardware repair and removal 17. Support development of new computer’s project 18. Develop strategies and planning to meet future hardware needs 19. Planning the computer network 20. Provide designing and implementation of computer network http.//wordtemplate.net/

Example of Job Description - 1

Chapter 2: Job Analysis and Job Design

41

Example of Job Description - 2 HRM – In lighter vein

Job Specification The personal qualifications an individual should possess to perform the duties and responsibilities contained in a job description are compiled in the job specification. Job specification covers two areas viz. the skills required to perform the job and the physical standards essential to perform the job. ¾ Skills relevant to job include education, experience, specialized training, personal traits/abilities and manual dexterities. ¾ The physical demands include the amount of walking, standing, reaching, lifting or talking to be done on the job. ¾ Job specifications also include interpersonal skills or specific behavioural attributes necessary to perform the job. ¾ The behavioural competencies include the ability to make decisions on inadequate or imperfect information, decisiveness, the ability to handle multiple tasks and conflict-resolution skills.

Example of Job Specification - 1

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Human Resource Management

PERSON SPECIFICATION POST DEPARTMENT KEY

: : :

Customer Services Adviser (Customer Service Centre) Revenues and Customer Services The following key shows at which stage each criterion needs to be evidenced

(A) = Application Form, (I) = Interview, (R) = Role Play/Test

Job specification includes the personal

Attributes Qualifications/ Experience

qualifications an individual should possess to perform the duties and responsibilities contained in a job description. It covers two areas viz. the skill job

and

the

physical standards essential to perform the job.

Desirable Experience of working within a contact centre of telephony environment (A) Previous cash credit handling experience (A)

Experience of using Windows-based computer packages (A) (I)

required to perform the

Essential Four GCSE/’O’ levels including Maths and English (A) or Equivalent vocational qualification (Level 2 NVQ) (A) or 5 years work experience in an administrative environment (A) and 2 years experience of working within a customer service environment (A)

Knowledge/Skills

Ability to communicate clearly and effectively by telephone in person and in writing (A) (I) (R)

Experience of using a database (A)

Quick and accurate keyboard skills (R)

Handling and resolution of customer complaints (A) (I)

Ability to make effective decisions within established procedures (I) A methodical and accurate approach to work activities (I) (R) Capable of following procedures and systematic processes (I) (R) Good organisational skills (I)

Figure 2.10: Elements of Job Design

Evidence of delivering a first class service to a diverse range of customers from initial point of contact (A) (I)

Job Design

Example of Job Specification - 2

Job design is an outgrowth of job analysis to improve jobs through technological and human considerations to enhance organization efficiency and employee job satisfaction. While job analysis is the study of jobs as currently performed by employees, job design is concerned with changing, modifying and enriching jobs to capture the talents of employees. This results in improving the organization performance. According to Snell and Bohlander (2007), job design is a combination of four basic considerations viz.

Chapter 2: Job Analysis and Job Design

43

organizational objectives, industrial engineering concerns, ergonomic considerations and behavioural concerns.

Job design is concerned

Organizational Objectives: These objectives include tasks, duties and responsibilities.

ing and enriching jobs to

Industrial Engineering Considerations:

with changing, modifycapture the talents of employees.

¾ It is a field of study concerned with analyzing work methods and time standards. ¾ It involves the study of work cycles. Decisions are taken as to which elements are to be modified, combined, rearranged or eliminated to reduce the time of operation. ¾ Time standards are established by recording the time required to complete each phase in the work cycle. ¾ It constitutes a disciplined and objective approach to job design. Ergonomic Considerations: Ergonomics is an interdisciplinary approach to designing equipments and systems which can be easily and efficiently used by human beings. It attempts to accommodate the human capabilities and limitations in performing jobs. It is concerned with adjusting the entire job system (the work, the work environment, the machine/equipment and the processes) to match human characteristics and needs. It tries to fit the job to the person rather than the person to the job. Ergonomics tries to minimize the harmful effects of carelessness, negligence and other human mistakes that otherwise may cause product defects, damage to equipment or even injury/death of employees. ¾ Physical ability of the operators is taken into consideration while designing equipments ¾ Controls of the equipment must be compatible with the physical characteristics as well as the reaction capabilities of the operators. ¾ It also considers the requirements of diverse workforce (menwomen, short-tall, strong physique-weak physique etc). ¾ Ergonomics improves productivity and morale resulting in higher ROI. Behavioural Concerns: Job enrichment model and job characteristics model increase job satisfaction. Both the methods strive to satisfy the intrinsic needs of employees.

Job design is the combination of organizational objectives, industrial engineering concerns, ergonomic considerations and behavioural concerns.

Ergonomics is an interdisciplinary approach to designing equipments and systems which can be easily and efficiently used by human beings.

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Human Resource Management

Job enrichment is an effort to enhance a job by adding more meaningful tasks and duties to make the job more rewarding, satisfying or meaningful.

Job Enrichment: It is an effort to enhance a job by adding more meaningful tasks and duties to make the job more rewarding, satisfying or meaningful. It fulfills the high motivational needs of employees, such as self-esteem and self-actualization. Job enrichment, otherwise known as vertical expansion of job may be accomplished by increasing the autonomy and responsibilities of employees. Herzberg suggested five factors to enrich jobs: ¾ Increasing the responsibility of the job. ¾ Allowing employees to retain more authority and control over work conditions and outcome. ¾ Providing feedback on the performance/activities directly to the employees. ¾ Adding new tasks to the job that require training. ¾ Assigning individuals specific tasks or increasing the difficulty of job, thus enabling them to become experts. The above methods allow employees to assume a greater role in the decision-making process. Job enrichment can also be accomplished by organizing workers into teams and empowering these teams with greater authority for self-management. Limitations of Job Enrichment: Though job enrichment brings in more benefits, there is no guarantee that it will overcome production problems and employee discontent. ¾ It may not work out in all types of jobs. ¾ It cannot be a solution to problems such as dissatisfaction with pay, employee benefit or employment security. ¾ Further, not all employees seek additional responsibility or challenging jobs.

Job characteristics include five core dimensions viz. skill variety, task identity, task significance, autonomy and feedback.

Job Characteristics: Richard Hackman and Greg Oldham, in their job characteristics model, proposed that three psychological states viz. experiencing meaningfulness of the work performed, responsibility for work outcome and knowledge of the results of the work performed, of a jobholder result in improved work performance, internal motivation and lower absenteeism/turnover. They believe that the following five core job dimensions produce the three psychological states:

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45

Skill Variety: It is the degree to which a job entails a variety of different activities, which demand the use of a number of different skills and talents by the job holder. Task Identity: It is the degree to which the job requires completion of a whole and identifiable piece of work. i.e. doing a job from beginning to end with a visible outcome. Task Significance: It is the degree to which the job has a substantial impact on the lives or work of other people, whether within the organization or in the external environment.

Empowerment is the process

of

granting

employees power to initiate change thereby encouraging them to take charge of what they do.

Autonomy: It is the degree to which the job provides substantial freedom, independence and discretion to the individual in scheduling the work and in determining the procedures to be used in carrying it out. Feedback: It is the degree to which carrying out the work activities required by the job results in the individual being given direct and clear information about the effectiveness of his performance. To make job characteristics model successful, employees must have the psychological desire for autonomy, variety, responsibility and challenge of enriched jobs. They must have the physical or mental skills, abilities or education needed to perform the job. There should not be any compulsion, as forcing enriched jobs on individuals lacking these traits can result in frustrated employees. Employee Empowerment: A less structured method compared to job enrichment and job characteristic models to allow employees to initiate their own job changes is the concept of empowerment. Empowerment is the process of granting employees power to initiate change, thereby encouraging them to take charge of what they do. It is a technique of involving employees in their work though inclusion. Empowerment encourages employees to become innovators and managers of their own work. It involves the employees in their jobs in many ways that give them more control over decisionmaking.

Figure 2.11: Empowering Women

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Human Resource Management

Empowerment requires participation, innovation, access to information, accountability, appropriate

organizational

culture and effective leadership.

Effective empowerment requires the following conditions: Participation: Employees must be given chance and also encouraged to take control of their tasks. Employees, in turn, must take care about improving their work process and interpersonal work relationships. Innovation: The environment must be conducive with innovative ideas. Employees are encouraged to explore new paths and to take reasonable risks at reasonable costs. Access to Information: Employees must have access to a wide range of information and the employees interested in empowerment decide what kind of information they need for performing their jobs. Accountability: Employees cannot afford to be careless. They should be held accountable for their behavior, producing targeted results, achieving credibility and operating with positive approach. Organizational Culture: Culture of the organization must be open and receptive to change. Leadership Style: Effective leadership to encourage empowerment is highlighted by managers who are honest, caring and receptive to new ideas. The managers must exhibit dignity and respect for employees as partners in progress.

Job Design: Approaches and Outcomes – A Different Thinking There are four approaches which comprehensively deal with job design issues. All the jobs are characterized in terms of how they fare according to each approach. Campion (1987) vividly characterized jobs on different dimensions of job design. Mechanistic approach

Motivational approach

Biological Approach

Perceptual-Motor Approach

· Job specialization

· Autonomy

· Strength

· Lighting

· Specialization of tools and procedures

· Intrinsic job feedback

· Lifting

· Displays

· Task simplification

· Extrinsic job feedback

· Endurance

· Programs

· Single activities

· Social interaction

· Seating

· Other equipment

· Job simplification

· Task / Goal clarity

· Size difference

· Printed job materials

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Table (Continued) · Repetition

· Task variety

· Wrist movement

· Workplace layout

· Spare time

· Task identity

· Noise

· Information input requirements

· Automation

· Ability/Skill-level requirements

· Climate

· Information output requirements

· Ability/Skill variety

· Work breaks

· Information- processing requirements

· Task significance

· Shift work

· Memory requirements

· Growth/Learning

· Stress · Boredom

Mechanistic Approach The focus of the mechanistic approach is identifying the simplest way to structure work to maximize efficiency. The different dimensions of this approach are job specialization, specialization of tools and procedures, task simplification, single activities, job simplification, repetition, spare time and automation. ¾ The objective is to make the work so simple that anyone can be trained quickly and easily to perform the task. ¾ The approach focuses on designing jobs around the concepts of task specialization, skill simplification and repetition. ¾ This approach is based on the classical Scientific Management which emphasized identification of the ‘one best way’ to perform the job.

Mechanistic approach is identifying the simplest way to structure work to maximize

efficiency.

The dimensions include job specialization, specialization of tools and procedures, task simplification, single activities, job simplification, repetition, spare time and automation.

¾ Through mechanistic approach, the organization reduces the need for high-ability individuals. ¾ This approach enables the organization train the new employees quickly with less cost.

Motivational Approach As a reaction to mechanistic approach, motivational approach is rooted in organizational psychology. It focuses on the job characteristics that affect psychological meaning and motivational potential. It views attitudinal variables such as satisfaction, intrinsic motivation, job involvement etc as the most important outcomes of job design. The different dimensions of this approach are autonomy, intrinsic and extrinsic job feedback, social

Motivational approach focuses on the job characteristics that affect psychological meaning and motivational potential.

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Human Resource Management

interaction, task/goal clarity, task variety, task identity, ability/skill level requirements, ability/ skill variety, task significance and growth/learning. It focuses on increasing the complexity of jobs through interventions such as job enlargement, job enrichment and designing jobs around sociotechnical systems. Biological

approach

focuses on outcomes such as physical fatigue, aches / pains and health complaints.

Biological Approach This approach comes primarily from the sciences of biomechanics (body movements), work physiology and occupational medicine, generally referred to as ergonomics. The different dimensions of this approach are strength, lifting, endurance, seating, size difference, wrist movement, noise, climate, work breaks and shift work. ¾ It is concerned with examining the interface between individuals’ physiological characteristics and the physical work environment. ¾ This approach aims at minimizing physical strain on the worker by designing the work environment to suit body movements. Hence, this approach focuses on outcomes such as physical fatigue, aches and pains and health complaints.

Perceptual motor approach includes different dimensions such as lighting, computerized programs,

ease

of

equipments, printed job materials, work place layout, information input – processing – output

Perceptual-motor Approach This approach focuses on human mental capabilities and limitations. The different dimensions of this approach are lighting, computerized programs, ease of equipments, printed job materials, workplace layout, information input-processing-output requirements, memory requirements, stress and boredom. The jobs are designed in such a way that they do not exceed people’s mental capabilities and limitations. It tries to improve reliability, safety and user reactions by designing jobs to reduce their information processing requirements.

requirements, memory requirements, stress and boredom.

Trade-offs among Approaches to Job Design Each approach to designing a job has its advantages and limitations. The managers who design jobs to maximize the outcomes for the jobholders and the organization must be aware of all the positive and negative outcomes of the approaches. They must be able to understand the costs and benefits associated with each approach and balance them appropriately to give the organization a competitive advantage.

Chapter 2: Job Analysis and Job Design

Summary of outcomes from the job design approaches (Campion,1987) Job Design Approach Mechanistic

Positive Outcomes

Negative Outcomes

- Decreased training time

- Lower job satisfaction

- Higher utilization levels

- Lower motivation

- Lower likelihood of error

- Higher absenteeism

- Less chance of mental overload and stress Motivational

Biological

- Higher job satisfaction

- Increased training time

- Higher motivation

- Lower utilization levels

- Greater job involvement

- Greater likelihood of error

- Higher job performance - Lower absenteeism

- Greater chance of mental overload and stress

- Less physical effort

- Higher financial costs

- Less physical fatigue - Fewer health complaints

because of changes in equipment or job environment

- Fewer medical incidents - Lower absenteeism - Higher job satisfaction Perceptual-motor

- Lower likelihood of error

- Lower job satisfaction

- Lower likelihood of accidents

- Lower motivation

- Less chance of mental overload and stress - Lower training time - Higher utilization levels

Designing Work for Groups/Teams Most of the group techniques to involve the employees more fully in their organizations have two important characteristics viz. improving collaboration and increasing synergy.

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Human Resource Management

Collaboration helps improving work processes and organizational decisionmaking. Synergy is based on the adage that contributions of two or more employees are greater than the sum of individual efforts. Working in a group strengthens employee commitment to organization’s goals, increases employee acceptance of decisions and encourages cooperate approaches to tasks. Two important collaborate techniques are employee involvement groups and employee teams.

Employee Involvement Groups (Quality Circles) They are groups of 5-10 members doing similar or related work who meet regularly to identify, analyse, and suggest solutions to common organizational problems. Known as Quality Circles in many organizations, these groups are involved in larger goals of the organization. They suggest improving product or service quality and cutting costs. Steps involved in employee involvement process ¾ Brainstorming to generate ideas to improve quality of products/ services and safety concerns and to reduce costs. ¾ Preparation of solutions and recommendations for improvement. ¾ Evaluation of group recommendations by managers for decision making. ¾ Implementation of recommendations and rewarding of the groups for their contribution. Reasons for Employee Involvement Groups: ¾ Knowledge of the employees in the specialized area. ¾ Special skills and abilities of employees. ¾ Need for technical changes. ¾ Customer requirements. How to Make Employee Involvement More Effective? ¾ Comprehensive training in problem identification, problem analysis, statistical analysis and cause-effect relationship. ¾ Recognition of the group’s recommendation whether accepted or not. ¾ Giving ideas to the group to keep the process going. ¾ Participative/democratic leadership style to encourage collaboration.

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51

Employee Teams Employee teams are the outcome of employee involvement and empowerment. Team is a group of individuals working together closely toward a common goal. The team members have complementary skills. The members’ work is mutually dependent and the group has discretion over tasks performed. Members share responsibility and accountability for the team’s performance. Work is designed for the group as a whole rather than for individuals. Factors contributing to the synergy of team are: Support: All team members take active part in the discussion and other constructive suggestions/comment. Listening: Every member listens to others with interest and seeks clarifications without hesitation. Disagreement: Disagreements are openly discussed objectively without any personal ego/conflicts.

Figure 2.12: A Happy Team

Team is a group of individuals working together closely towards a common goal.

Consensus: Decisions are made based on the common ground. Acceptance: Every member respects the other member and recognizes other’s contribution. Quality: Every member is expected to have commitment for excellence and there is emphasis on continuous improvement.

Forms of Teams

Factors contributing to the synergy of team are support, listening, agreement, consensus, acceptance and quality.

Cross-functional Team: It is a team consisting of specialists from various functional areas such as production, finance, marketing and etc. to accomplish a particular assignment. Project Team: A team formed to design a new product or service and the Forms of teams are crossmembers are selected by the management based on their ability to contribute functional team, project effectively. team, process improve-

Process Improvement Team: Appointed by the management, it is a team of ment team, self directed experienced people from different departments/functions with the purpose of team, task force team improving quality, decreasing waste or increasing productivity in all and virtual team. departments/functions. Self-directed Team: It is a natural work unit of highly trained individuals performing a set of interdependent jobs based on consensus.

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Human Resource Management

Task Force Team: Formed by the management, it is entrusted with the responsibility of solving a major problem immediately and also to formulate a long-term plan for problem resolution. Virtual Team: It is a team with widely dispersed members linked together through internet. Though formed to compete in the national/international market, it is fraught with many problems such as language/cultural barrier, unclear objectives, time conflicts due to diverse geographical locations, lack of close interpersonal contact and etc.

Characteristics of Successful Teams ¾ Commitment to common goals and objectives without any personal agenda or ulterior motives. ¾ Members are highly motivated with lots of energy to accomplish the given task. ¾ Communication is open and honest without any need to read inbetween the lines. ¾ Participative and democratic leadership. Figure 2.13: Forms of Flexible Work Schedules

¾ Clearly defined assignments and roles. ¾ Climate of collaboration, cooperation, trust and accountability. ¾ Acceptance of conflicts and resolving conflicts constructively.

Flexible Work Schedules Strictly speaking flexible work schedules do not come under the purview of job design but they are discussed under job design as they are expected to improve productivity and jack-up morale through more control over their work hours.

Compressed Work Week In this system, the number of working days in a week is reduced and the number of working hours per day is lengthened. Generally employees opt for 4/10 schedule i.e., 10 hours per day for 4 days in a week.

Chapter 2: Job Analysis and Job Design

Reasons for Implementing Compressed Work Week: ¾ Recruitment and Retention of employees. ¾ Coordinating work schedule with production schedule. ¾ Facilitating employee personal appointments. ¾ Job satisfaction. Limitations:

53

In compressed work week, the number of working days in a week is reduced and the number of working hours per day is lengthened.

¾ Government rules may not allow extended working hours. ¾ Long hours may be stressful and exhausting.

Flextime Also known as Flexible working hours, flextime allows employees the option of choosing the starting and leaving time in a day, provided they put in certain number of hours per day or per week.

Flextime allows employees the option of choosing the starting and leaving time in a day

¾ In flextime, employees are free to fix their own schedule of work.

provided they put in

¾ There may be a ‘core period’ where all are expected to be on the job.

certain number of hours

¾ It is common in service type organizations and others with large clerical operations.

per day or per week.

Advantages: ¾ Employees can reduce some of the traditional causes of tardiness and absenteeism. ¾ Employees gain more job satisfaction when they are permitted to accommodate their particular life styles. ¾ Employees can schedule their work when they are more productive. ¾ It may reduce traffic congestion at peak commuting hours. Disadvantages: ¾ Not suited to many jobs. ¾ Managers may not be able to give instructions in case of emergency.

Job Sharing It is an arrangement where two part-time employees perform a job which can be done by one full-time employee. ¾ Job sharers usually work three days a week and their salary would be three-fifths of a regular salary. ¾ Job sharers usually take up additional responsibilities for extra money.

Job sharing is an arrangement where two part-time employees perform a job which can be done by one full-time employee.

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Human Resource Management

¾ Job sharing is seen primarily in legal, advertising and financial services business. ¾ It is suited to the families where both the spouses desire to work only part-time. ¾ It may limit layoffs in hard economic times. ¾ There is enough time for employees for personal work. ¾ The disadvantage is extra training cost and unsuitability for certain jobs. Telecommuting is the use of personal computers, networks and other communication technology such as fax machines to do work at home which is traditionally done in office /workstation.

Telecommuting It is the use of personal computers, networks and other communication technology such as fax machines to do work at home which is traditionally done in office/workstation. Virtual office is a variant of telecommuting where the employees can be anywhere. Advantages: ¾ More flexibility for employees.

Virtual office is a variant of telecommuting where the employees can be anywhere.

¾ Attracts and retains good employees. ¾ Fewer burdens on working parents.

Figure 2.14: Doing Office Work at Home

¾ Reduced time/money wasted on physical commuting. ¾ Increased productivity due to reduced absenteeism. Disadvantages: ¾ Loss of creativity due to absence of regular interaction among employees. ¾ Difficulty in formulating appropriate performance standards and evaluation systems for the telecommuters. ¾ Problem of developing suitable technology for allocation of resources. ¾ Poor supervisor-employee relations due to absence of inadequate information and trust. ¾ Regular employees feel jealousy of the telecommuting employees.

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How to Make Telecommuting Successful? ¾ Identifying jobs best suited to distance work such as sales, customer service, auditing etc. ¾ Selecting responsible employees who are self-starters, motivated and trustworthy ¾ Establishing formal procedures such as guidelines on hours of availability, office reporting periods, performance expectations and progress reports/email updates ¾ Training programme can be conducted on the usage of relevant technology, maintenance of relationship, support facilities and etc. ¾ K e e p i ng the telecommuters informed of department/staff updates, project teams, attendance at meetings etc.

HRM – In lighter vein

¾ Recognizing when telecommuting is not working and terminating the system when it no longer serves the company or when the employees’ performance declines.

“Flexible hours sounds good. Put me down for any shift you’re NOT here.”

Review Questions

Review Questions Answer in brief

1. Differentiate job analysis and job evaluation.

7. What is competency model?

2. What is job family?

8. What is job specification?

3. D i s t i n g u i s h j o b d e s c r i p t i o n a n d j o b specification.

9. What is job enrichment?

4. What is O*NET?

11. What is job sharing?

5. What is a job position?

12. What is telecommuting?

6. What is critical incident method?

10. What is a cross functional team?

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Human Resource Management

Answer in detail 1. Describe the process of job analysis. 2. Describe the techniques involved in job analysis.

5. What is the role of competency model in job analysis? 6. Discuss the components of job description.

3. What are the approaches to job analysis?

7. Analyse the components of job design.

4. What is the need for job analysis?

8. What are the approaches to job design? 9. Discuss the flexible work schedules.

Specialists Speak

Specialists Speak Specialists Speak – 1

Sajiri Chidgupkar, HR Enthusiast & Freelance Consultant Competency Based Development Everyone today is talking about competency based development. Here is my attempt and version of what can be competency based development. Let’s start from the beginning, i.e. the meaning of competency. There are many definitions of competency doing rounds, for the article we’ll look at competency as a trait or characteristic that allows an individual to successfully accomplish work or task assigned. These characteristics are the culmination of individual’s; skills, knowledge and attributes. The traits or characteristics are known as competency only and only if they allow or result in superior performance. The next question is often asked why use competency as the predictor of performance? Why not simply look at the individual’s performance? Well the answer is simple while in the short term which might mean in the current role the performance of the individual might be a good indicator but for future performance competency is not only a better option but more often than not the only option. The reason being that; people perform tasks or jobs using their competency to achieve desired results. While work or jobs might change, competencies are of more enduring nature and immune to change in the job or work context. To summarize competencies are what individuals use to perform successfully and without it consistent performance is not possible. Now that we have attempted to state the meaning of competency we take on our next important phrase “employee development” is the pursuit of any activity that leads to continuous learning, personal growth, and which contributes to the

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achievement of both an individual’s and their employer’s or organization’s objective(s) on the longer term. Keeping the above two definition in mind we have tried to list down certain steps which might be used work towards doing a pilot and then institutionalize competency based employee development. 1. The Background a. Identify a champion, target employees, and structural framework for an employee development process. b. Assess the need for a competency development process; get an estimate for the organization’s competency needs. c. Complete employee competency assessments and define estimates of target employees’ competency acquisition needs. (A SWOT of the target group’s competencies) 2. The Plan and Implementation a. Understand the target groups “personal aspirations”. b. Develop a plan for implementation of the competency based employee development services. c. Brief all stake holders and obtain resource support to implement the start-up process plan. d. Create a steering committee (there should be representatives from all stat holders). e. Implement and evaluate the start-up process. 3. The Follow up a. Make case studies of the implementation and spread the learning’s amongst the stake holders. b. Institutionalize the learning and take the process to a larger group. This is what I feel organizations may try to build a sustainable competency based employee development. The above section talks about Organizations’ role in the process; in the following steps I’ll elaborate what should an employee do to ensure a holistic success of not just the process but their own careers also. - Understand the Requirement: Most organizations have a central document which lists the competency expectations from every role in the organization. Make sure that you visit this page and understand the requirement correctly. Don’t hesitate to clarify if you are in doubt, remember in the long run it will only be of your help. -

Stop Excusing Yourself from Trainings: One often ignores the soft skills (business skills) trainings that you are asked to attend. These trainings are organized for your benefit. Try to maximize the learning from these sessions. They will stand you in good stead.

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Human Resource Management

4. Appraisals Mean much for Than Hikes and Promotions: People often make the mistake of looking at appraisal only as a precursor to hikes and promotions. One must rather concentrate on the discussion of how one can better the performance. Which are the competencies that one needs to work harder on? (Source: http://www.contentwriter.in/articles/hr/competency-based-development.htm) Specialists Speak – 2

Julie Callender, SPHR, HR Manager for Talent Systems We’d like to offer our employees some flexibility in their summer work schedules. What are some innovative ideas? What are some problems to avoid? Our company is implementing a summer hours program. Summer 2012 was a pilot; the program was so successful and our leadership team received such positive feedback that the program will be offered again this year at our nonmanufacturing locations. Identifying ways to increase flexibility in how we accomplish our work is part of a larger, on-going effort in our organization. How It Works? From Memorial Day through Labor Day, participating departments offer employees the opportunity to work a full work week from Monday through a half-day Friday. Our standard work week is 37.5 hours. Employees in participating departments may rotate taking pre-scheduled half-day Fridays off, beginning at 1 p.m. on Friday, every other week, work permitting. Schedules are worked out so that departments and work groups maintain adequate coverage and high-quality services at all times. Communication with managers and colleagues is key to the success of the program. The program is communicated approximately 30 days prior to Memorial Day in order for department managers to plan scheduling. Among the Problems to Avoid Entitlement. While it was not a problem in 2012, there is no guarantee that this program will continue for years to come. Balancing the work against the positive employee experience around this program will be critical to success in the future. Even employees who—due to work obligations—are not able to participate as often are very grateful that the program exists and the opportunity to take advantage of it is there. Negative perception if departments decide to opt out of the program. While we did not have any opt out last year, if any departments decide to do so in the future, it could be viewed very negatively by employees working in those groups. (Source: http://www.shrm.org/Publications/hrmagazine/Pages/HR-Solutions-Challenge.aspx)

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Case Study

Case Study Case 1

Mr. Kishore is a Branch Manager of Indian Bank at one of its rural branches. His staff included two clerks and an attendant. Very often Mr. Kishore was left alone in the bank after 5 p.m. to tally accounts, day books and complete all other formalities. On the 30th December Mr.Kishore was working till 2 a.m. tallying the accounts since hardly one day was left for closing the accounts for the year. On this fateful night, the Branch Manager was attacked by a band of robbers, who looted 5 lakhs after brutally wounding Mr Kishore’s right hand, which had to be amputated later. After his recovery, the Branch Manager applied for compensation. The Bank Management was of the opinion that Mr. Kishore violated the job specification by working beyond the stipulated hours of work. He, in their view, was not entitled to any compensation as the accident occurred during non-employment hours. They also called for an explanation as to why the amount lost cannot be recovered from his salary. Questions: 1.

How do you justify the bank’s stand in this case?

2.

What modifications do you suggest in job specification to overcome such incidents in future?

(Annamalai University, December 2012)

Case 2 Mr. Ramachandran is the Chief Executive of ABC Ltd. Recently it was decided by the Board of Directors that it would be profitable for the corporation to set up a separate Marketing Department. Mr. Ramchandran has been directed to pick up a person whom he feels is capable of heading the department and then making the person in charge of getting the department on its feet. After considering a number of good men, Mr. Ramachandran has narrowed the field down to two possible choices: Rajesh Mehta and Pramod Kumar. Rajesh Mehta has a good track record with the company. He was hired eight years ago and through the years he has shown a good deal of drive and initiative in all of his endeavors. He is an aggressive young man and has received the nickname of ‘go getter’ in his department. Although Mehta seems to be more concerned at times with ends rather than means, he is very efficient and considered a good leader by those who work under him. As one worker stated, “Although he can get rough with you at times you always know where you stand with him and when you

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have done a good job, he lets you know it”. Mehta is also credited with accepting full responsibility in all cases and making quick decisions when action is called for. Pramod Kumar has been with the company for eleven years. He is well liked by all in his department and his work is first rate. Kumar’s leadership style differs from Mehta’s in that Kumar is not as aggressive and quick as Mehta. Before Kumar makes a decision he generally consults others whom he feels can contribute further information on a given subject. This often includes those who work under him. Those who work under Kumar consider him a good leader and state the atmosphere of participation produced by Kumar really encourages their utmost individual output while in the job. This can be seen by the production increase which soon occurred when Kumar became the head of his work force. Questions: 1.

If you were Mr. Ramachandran whom will you select as head of the Marketing Dept? Why?

2.

Will you give weightage to the length of service in the organization? Why?

(Karunya University, September/October 2010)

Classroom Project

Classroom Project

Each student is asked to find out an innovative job title which does not currently exist in organizations. The job can be from any level and any sector. It can be technical or non-technical in nature. The student has to design the job with detailed job description and specification. He/she has to prepare a collage of the job activities and present it in the classroom along with all the details listed down. The most innovative and informative title will win this activity as evaluated by other students or a panel of students from non-HR stream.

Field Project

Field Project

The students, in groups of 4-5 members, are to visit many firms in various industries. They are instructed to collect details of job descriptions and job specifications of jobs at various levels. The details are presented in the classroom and the best ones are selected. Multiple copies of the best Job description and Job specification are taken and distributed to the students for their reference.

Human Resource Planning and Human Resource Information System •

HRM - Indian Perspective

•

HR Planning

•

HR Planning System

•

HR Forecasting

• • •

Key Terms HR Planning

HRIS

HR Forecasting

Delphi Technique

HR Forecast- Internal and External Sources Importance of Human Resource Planning Human Resource Information System (HRIS)/ Computer Applications in HRM

•

Review Questions

•

Specialists Speak

•

Case Study

•

Classroom Project

•

Field Project

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Human Resource Management

HRM – Indian Perspective

Group Logo

Aditya Birla Group of Companies

Shri.Kumar Mangalam Birla, Chairman

The Aditya Birla Group is a large Indian conglomerate started in 1857 as cotton trading unit by Shiv Narayan Birla and manufacturing unit in 1919 by Ghyanshyamdas Birla. Kumar Mangalam Birla is currently heading the group from 1995. The Group companies include Grasim Industries Ltd., Hindalco Industries Ltd., Aditya Birla Nuvo Ltd., UltraTech Cement Ltd., PSI Data Systems, Idea Cellular Ltd., Aditya Birla Insulators etc. to name a few. The Aditya Birla Group is an equal opportunity employer and does not discriminate based on race, community, religion or sex. The HR initiatives are categorised under three main heads: Learning and re-learning, performance management, and organizational renewal. Gyanodaya, the group’s learning centre, facilitates the first category. It enables the transfer of best practices across group companies honing the group’s competitive edge. Aditya Disha, the group’s intranet, provides employees access to the training calendar that consists of a combination of classroom, outreach and elearning programmes. The learning channels deployed by Aditya Birla Group: The virtual campus Knowledge Integration Programme (KIP), Continued learning- mid-career education, E-360 degree instrument, Group intranet, Development Assessment Centres (DACs) and Talent reviews. The group believes that learning is a continuous process and has partnered with Singapore’s Universitas to offer an Online MBA Program to help employees acquire the latest management techniques and broaden their vision with a global perspective that is in line with group’s global ambitions. A 3600 degree feedback program was introduced in 1999 that permitted managers to raise questions over chairman’s leadership style, managerial ability and also personal traits. The organizational health survey was adopted in the late 1990s, which measured the “Happiness at work” index to track the employees’ satisfaction. The HR system at the AV Birla group is built on the foundation of a meritocracy. Development Assessment Centers (DACs) have been designed to support managers in assessing and developing their capabilities. A three-tier annual

Chapter 3: Human Resource Planning and Human Resource Information System

talent review process, held at the unit level, business level and group level, ensures a focused approach to the implementation of Individual Development Plan. All new hires on their date of joining the organization participate in a program called “Speak your Mind” in interface with HR. The group has a Leadership Program viz. LEAD conducted for grooming the exceptional employees. Another programme is LEAP –Leadership Associate Program, an intensive one year, on - the - job training program. Employees are recognized through Chairman’s Awards for Individual Excellence to felicitate individual efforts at all levels. Performance Recognition In Delivering Excellence (PRIDE) is a monetary recognition program to reward and recognize outstanding contributions in businesses and corporate functions. Employee health benefits are enormous including all possible avenues ensuring health and safety of employees. The group provides good growth opportunities for women employees through talent development programmes for middle level women executives, flexi working arrangements, counseling programmes and quarterly e-magazine for women. HR practices, employee care, people philosophy and engagement all have been well recognized through a range of external honors and awards for the group as a whole and for individual businesses. A retirement policy was introduced in 1995, early 60s had to quit the organization in the next five years and subsequently about 400 young employees replaced them. Events are designed to make the employees and their families feel as much a part of the group. Events like Annual Day, Kids’ Day Out and Family Picnics to Best Employer Celebrations and the Sawan Mela are organized.

HR Planning HR planning may be defined as a process as well as an effort to anticipate future business and environmental demands on an organization and to provide qualified people to satisfy those demands. The ultimate objective of HR planning is the most effective use of scarce human talent in the best interest of the employees and the organization. HR planning must be consistent with the overall business and HR strategies. People-related business issues will affect strategic business plans as well as workforce plans to a great extent. HR planning process involves the following 3 stages.

Figure 3.1: Planning Session in Progress

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Figure 3.2: HR Planning Process

HR Planning System HR planning system comprises several specific interrelated activities viz. Talent Inventory, HR Forecasting, Action Plans and Control and Evaluation.

Talent Inventory It is a fundamental requirement of any HR planning system. It is an organized data base of the existing skills, abilities, career interests and experience of the employees. Information included in the inventory are: ¾ Current position of the individual ¾ Previous position(s) in the present company ¾ Total work experience (present and previous companies) ¾ Educational background which includes degrees, diplomas, licenses, certificates and etc. ¾ Language skills: Number of languages known

Figure 3.3: Activities of HR Planning System

¾ International experience: Number of countries and duration of stay ¾ Training and Development programmes attended ¾ Leadership positions held and responsibilities ¾ Performance appraisal data, past and present ¾ Disciplinary actions taken, if any, in the present and past positions ¾ Awards and recognitions

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Talent inventory helps in identifying candidates for promotion, management succession planning, assignment to special projects, transfer, training, compensation planning, career planning and etc.

HR Forecasting The objective of HR forecasting is to estimate manpower requirements at some future time period. Forecasts are two types viz. manpower demand and manpower supply.

Forecasting Demand Demand depends on products/service demand, economics, technology, financial resources, absenteeism/turnover, organizational growth, management philosophy, age distribution of workforce, terminations, retirements, and etc. Techniques employed are quantitative as well as qualitative. Quantitative Approaches: These forecasts involve the use of statistical or mathematical techniques. The common technique is trend analysis, which forecasts employment requirements based on some organizational index. Steps in trend analysis are: ¾ Selection of an appropriate business factor such as sales, which is the best available predictor of HR needs. ¾ Plotting a historical trend of the business factor (eg.Sales) in relation to the employees. The ratio of employees to the business factor will provide a labour productivity ratio (eg. Sales/employee). ¾ Computation of productivity ratio for atleast the past five years. ¾ Calculating manpower demand: dividing the business factor (e.g., Sales) by the productivity ratio.

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HR planning is the process as well as an effort to anticipate future business and environmental demands on an organization and to provide qualified people to satisfy those demands. The stages of HR planning process are issues analysis, forecasting requirements and action plans.

HR planning system comprises several specific interrelated activities viz. talent inventory, HR forecasting, action plans and control and evaluation. HR forecasting helps estimate manpower requirements at some future time period. Forecasts are two types viz. manpower demand and manpower supply.

¾ Projecting manpower demand to the target year. Example: If the expected sales for 2014 is Rs.3880 Lakhs and the labour productivity (sales/employee) trend is 12.52, then the number of employees required for 2014 is 310 (i.e. 3880/12.52) While trend analysis relies only on a single factor such as sales, advanced methods combine several factors such as interest rates, gross national product, disposable income and sales to predict manpower demand. Qualitative Approaches: In contrast to quantitative approaches, qualitative approaches are less statistical. They mostly depend on the interests, abilities

Demand depends on products/service demand, economics, technology, financial resources, absenteeism/turnover, organizational growth, management philosophy, age distribution of workforce, terminations, retirements, and etc.

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Management forecasts are the opinions or judgements of supervisors, department managers, experts and others who know more about the HR need of the organization.

and aspirations of individual employees with the present and future manpower needs of an organization. In this approach, HR managers, in both small and large organizations, rely on experts. Management Forecasts: These are the opinions or judgements of supervisors, department managers, experts and others who know more about the HR need of the organization. Delphi Technique: Originally developed as a method to facilitate group decision making, Delphi technique is being used in workforce forecasting. It attempts to decrease subjectivity of forecasts by soliciting and summarizing the judgements of a preselected group of experts. It requires a great deal of coordination and cooperation to ensure satisfactory forecasts.

Delphi technique solicits and summarizes the judgements of a preselected group of experts.

Figure 3.4: Delphi Technique

(Source: http://acefinance.me/2013/07/15/delphi-method-of-predicting-thefuture-for-mankind/)

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¾ Delphi technique was developed during the late 60s by the Rand Corporation. ¾ The objective is to predict future developments in a particular area by combining the independent opinions of experts. ¾ Experts are chosen on the basis of their knowledge/expertise. ¾ Face-to-face group discussion is avoided to elicit free opinions without any inhibition. ¾ For coordination an intermediary is used. His or her job is to pool, summarize and then feedback the information generated independently by all the experts in the first round of forecasting. ¾ The cycle is repeated to enable the experts to revise their forecasts based on the feedback of others’ opinion. ¾ With 3 to 5 successive rounds there will be some sort of consensus.

Forecasting Supply Supply of manpower depends on internal considerations as well as external considerations such as demographic changes, education of workforce, labour mobility, government policies and unemployment rate. As with demand forecasts, the process of supply forecasts involve tracking of current manpower availability and making future projections. Techniques in forecasting of supply are: Staffing Tables: These are graphic representations of all organizational jobs along with the number of employees presently occupying those jobs and future (monthly or yearly) employment requirements. Markov Analysis: This shows the actual number as well as the percentage of employees who remain in the job year after year and the proportions of those who are promoted, demoted or transferred or exit the organization. It is a method of tracking the pattern of employee movements through various jobs. Skill Inventories/Management Inventories: Skill inventories list each employee’s education, past work experience, vocational interests, specific abilities/skills, knowledge, compensation history and job tenure. These inventories allow managers to quickly match job openings with employee backgrounds. When data/information on managers are collected by the management, it becomes management inventory.

Supply depends on demographic changes education of workforce, labour mobility, government policies and unemployment rate. Techniques employed are staffing tables, Markov Analysis, skill/management inventories, replacement charts and succession planning.

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Replacement Charts: These charts are made based on talent inventories (skill and management inventories) and list current job holders and people who are potential replacements if an opening occurs. Succession Planning: It is the process of identifying, developing and tracking key individuals for top-level executive positions.

HR Forecast - Internal and External Sources There are two sources to get forecast data and requirements. Internal sources for obtaining manpower forecast requirements are the existing employees of the organization. External sources for HR requirements and supply can be from competitors, consultancies, cold applications, trade associations, government agencies, economic forecasts or data and etc.

Action Plans Action plans involve balancing supply and demand through recruitment and reduction of manpower.

Action plans involve balancing supply and demand. Shortage: When demand exceeds supply, the organization goes for recruitment. Recruitment involves: ¾ Full-time employment ¾ Part-time employment ¾ Recalls (old employees) Surplus: When supply exceeds demand the organization resorts to reductions through: ¾ Layoffs ¾ Terminations ¾ Demotions ¾ Retirement

Control and evaluation guides the HR planning activities, identifying deviations from the original plan and analyses the causes for deviation.

Control and Evaluation The objective of control and evaluation is to guide the HR planning activities, identifying deviations from the original plan and analysing the causes for deviation. The objectives could be qualitative, quantitative or a combination of both. Quantitative objectives make the evaluation and control process more objective and measure deviations more precisely. But, generally,

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evaluation is likely to be more qualitative than quantitative, with little emphasis on control. As supply-demand forecasts are mostly based on ‘hunches’ and subjective opinions, HR planners are expected to assess the following: ¾ Workforce problems, opportunities and prioritization of activities. ¾ Relationship with staff specialists and line managers who provide data and use HR planning results. That is, how closely the HR planners work with these specialists and line managers on a dayto-day basis. ¾ The extent to which the decision makers, right from line managers who select employees to top level managers who develop longterm business strategy, use the forecasts, action plans and recommendations. ¾ The perceived value of HR planning among the decision makers. That is, to what extent they consider the forecasts are useful. In established HR planning systems efficacy of forecasting is measured by the following key comparisons: ¾ Actual staffing levels vs. forecast staffing requirements ¾ Actual levels of workforce productivity vs. anticipated productivity ¾ Actual workforce flow rate vs. desired rates ¾ Action programs implemented vs. action programs planned ¾ Actual results of the action programs vs. expected results ¾ Labour/action program costs vs. budgets ¾ Action program benefits vs. action programme costs

Importance of Human Resource Planning HR planning is very important as it serves as a reservoir of human talent that is available in the organization for future needs. It gives HR professionals and other line managers a clear picture of existing workforce and the gap between current and future requirements. ¾ HR plan is a blueprint of demand and supply of labour that helps organizations to clearly plan for expansion and growth activities.

HR planning is important as it serves as a reservoir of human talent; shows existing workforce and the gap between current and future needs; helps plan for expansion and growth; devises suitable day to day strategies for increasing production and OD activities; helps decision making based on employee data; helps control costs related to manpower; aids to prepare periodical and annual budgets and to arrange action plans with detailed cost implications.

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¾ Productivity records are supported by HR plans to devise suitable day to day strategies for increasing production. ¾ Organization development activities are well implemented with proper HR planning in all the functional areas. ¾ It helps in decision making that involves employee data both in present and future. HRM – in lighter vein

¾ HR planning helps to control costs in all functional areas related to manpower and to prepare periodical and annual budgets and action plans with detailed cost implications. Without proper HR planning, organizations cannot assess the real impact of manpower element in results of organizational activities as a whole. When forecast accurately, it leads to clear understanding of human resource needs and sources of supply of those needs both from internal and external means.

Human Resource Information System (HRIS)/ Computer Applications in HRM Human Resource Information System (HRIS) is a computerized system that provides current and accurate data for purposes of control and decision-making. It is a system used to acquire, store, manipulate, analyse, retrieve and distribute HR information.

HRIS

Large quantities of employee data, including training records, skills, compensation rates, benefits, cost etc. can be used easily. The database is kept in a central and accessible location. However, there is certain confidential information which is not accessed by all. ¾ As HR affects the entire workforce the impact of HRIS can be dramatic. ¾ HRIS can be used to lower administrative costs, increase productivity, speed up response times and improve decision making and customer service.

Chapter 3: Human Resource Planning and Human Resource Information System

¾ Most common HRIS applications are payroll, benefits, enrollment /administration, recruiting (tracking of applicant), personnel administration, training and development, employee self-service and manager self-service. As many options are available under HRIS, the first step in choosing an HRIS is for HR personnel to evaluate the biggest ‘headaches’ they experience or most time-consuming tasks and then choose the applications that can have the strongest impact on the organization’s financial measures. The next step is to calculate the costs based on average salaries or HR hours that could be saved by using an HRIS along with hours of increased productivity. In addition, the following items need evaluation: ¾ Fit of the application to the firm’s employee base ¾ Ability to upgrade and customize the software ¾ Compatibility with current systems

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Human Resource Information System (HRIS) is a computerized system that provides current and accurate data for purposes of control and decision-making. It is a system used to acquire, store, manipulate, analyze, retrieve and distribute HR information. The advantage of using HRIS is that the HR personnel can concent-rate more effectively on the firm’s strategic decision instead on the routine tasks.

¾ User friendliness ¾ Availability of technical support ¾ Time required in implementing and training staff members ¾ Initial costs and annual maintenance costs The biggest advantage of using HRIS is that the HR personnel can concentrate more effectively on the firm’s strategic decision instead on the routine tasks. Initially HRIS was related to cutting HR costs. But now it is used to share information with line managers to enable them go in for better production practices and cost control solutions. The other computer applications in HR are in the areas of e-recruitment, online training, telecommuting and e-payroll etc. E-recruitment: There are many online websites that are used to collect applications from potential candidates. There are specialized softwares to sort, screen and conduct interviews through electronic media. Many organizations prefer e-recruitment for the advantages of low cost and wide reach. Online Training: Many organizations adopt online training through interactive packages in specific areas. The advantage of this method is onetime installation and access by a large pool of employees. Telecommuting: Electronic networks, ICT tools and application based softwares have made it possible for employees to work from distant places.

The computer applications in HR are e-recruitment, online training, telecommuting, e-payroll, etc. The security systems have to be strong in case of e-HR as the data is confidential and sensitive. ERP helps in better planning of HR activities with its special modules on human resource applications.

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It gives the benefit of work at home and is suitable for attracting talented employees who prefer comfortable timings of work and autonomy. E-payroll: Computerized packages manage all the compensation related data of employees in the organization. It helps to calculate the salary and HRM – In lighter vein other monetary benefits payable to employees by pooling data on leave, loss of pay, performance, overtime etc.

Personnel

The list is not exhaustive and there are many other new HR areas coming up that utilize computer applications. The security systems have to be strengthened in case of e-HR as the data are confidential and sensitive. ERP helps in better planning of HR activities with its special modules on human resource applications.

“My Resume is on YouTube – here’s the URL.”

Review Questions

Review Questions Answer in brief

Answer in detail

1. Define HR planning.

1. Discuss the various stages of HR planning process.

2. What is HR forecasting? 3. What are action plans? 4. What are the internal sources of HR forecasting? 5. What are the external sources of HR forecasting? 6. What is HRIS?

2. Discuss the techniques involved in HR forecasting. 3. What are the steps involved in trend analysis? 4. Describe Delphi technique in HR forecasting. 5. Discuss the importance of control and evaluation in HR planning. 6. Discuss the areas of computer applications in HRM.

Specialists Speak

Specialists Speak Specialists Speak –1

Ankita Shreeram

Untapped Resources Here are five potentially unexploited resources that could just be the solution to a particularly taxing problem plaguing Indian organisations

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1. The side-lined employee? Especially in large organisations, it becomes impossible to devote due attention to each and every employee and the less exuberant but potentially talented ones may end up getting side-lined. “In a volatile, an uncertain and dynamic business environment, leaders in an organisation constantly prioritise their manpower to create the desired impact on the business outcome. This may result in generating a feeling of being left out amongst a few employees. Hence, organisations must ensure constant upgradation of the skill and capability inventory, create a knowledge repository and harness latent talent of resources, which may be leveraged differently at different business situations depending on their capabilities,” opines Amit Das, senior VP - group HR, RPG Enterprises. 2. An idea/plan you may have put on the back-burner? Sometimes, good ideas are temporarily set aside due to their unsuitability. However, the mistake lies in not revisiting these ideas periodically. “It is very essential to have a culture of innovation and a good knowledge management system to ensure that ideas and plans are not lost. I worked for a company that always recorded the ‘ideas’ from the meeting and very successfully used them in creating very innovative and user-friendly software applications,” shares Shamik Vora, VP-HR, The Bombay Store. 3. A candidate you didn’t end up hiring but could be a perfect fit for a current project? HR executives interview hundreds of candidates in their careers and it is not humanly possible to keep track of each one of them. It is at these junctures that technology comes to the rescue. “For the want of a decent HRIS (HR Information System), many organisations do not maintain a skill database of employees, let alone candidates interviewed. Maintaining a repository of skills across the organisation including the candidates interviewed can go a long way to activate an untapped asset,” says Vora. 4. A client that you haven’t paid full attention to? Businesses often fall into a comforting pattern with respect to interacting with clients, which may result in missing out of opportunities. “A combination of a CRM system and business intelligence tools can provide insight into customer mindsets, which are normally not very obvious. An investment in such systems will always help the business to bring focus back to the customer, which might have been otherwise lost,” avers Vora. 5. A space that you haven’t utilised? Have some spaces in your office that lie vacant and unused? Maybe they could help give shape to an unexecuted idea. “In my previous organisation, Repro India Ltd, we converted extra space exclusively into an area for office jam sessions. The result - an office band came to life. This idea got people closer and one could actually get a perspective on who the real leaders were,” reveals Girish Khare, director, marketing, Grass Roots India. “We have a section on the wall called the ‘wall of discovery’ dedicated to what our associates can discover new in the city in terms of eateries, shopping, sightseeing, hangouts and events in Mumbai every month. Our free spaces have recently been installed with music speakers running radio channels 24/7,” shares Saeid Heidari, general manager, Renaissance Mumbai Convention Centre Hotel and Marriott Lakeside Chalet Executive Apartments. (Source: http://itsmyascent.com/cms?targeturl=web%2Fitsmyascent%2Fhr-zone%2F-% 2Fasset_publisher%2FzM4i%2Fcontent%2Funtapped-resources)

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Specialists Speak - 2

Erin Huett, PHR, HR Generalist, City of Richmond Heights How should HR professionals respond when parents of minor employees want information regarding the employee’s work assignments, pay or disciplinary action? When the parent of a minor employee wants information regarding an employee’s work assignments, pay or disciplinary action, I refer the parent back to the child for this information. I would explain to this parent that the employment relationship is between the employer and the employee and that, by following this relationship, the minor child is learning responsibility and self-reliance. If the parent was asking general employment questions, such as position pay rates or typical work assignments and schedules, then I would provide as much information as I would for other general inquiries. As the HR representative, I would offer the parent my direct contact information to pass along to the child for any employment concerns or questions the child may have. While speaking with this parent, I would obtain the child’s name so that I could follow up with the child. Sometimes the minor employee may not feel comfortable walking into the HR department to ask a question or file a complaint, and sometimes the minor employee doesn’t know who to go to with a question or concern. By making the first contact, I would hopefully ease some of that discomfort and be able to address whatever issues he or she may bring forth. For many minor employees, this may be their first job. They most likely are still learning how to interact and conduct themselves on a professional level. Minor employees may benefit from a supportive employment relationship in which they can continue to grow and develop their professional skills. HR professionals can help to facilitate this relationship by being proactive and available to assist minor employees. Occasionally, this may require parental involvement with the child’s consent. Without the child’s consent, I would simply refer the parent back to the child for employment information. (Source: http://www.shrm.org/Publications/hrmagazine/Pages/HR-Solutions-Challenge.aspx)

Case Study Case Study Case 1

Wachovia Inc. headquartered in Atlanta is a leading financial holding company operating in regional, national and international markets. The member companies of Wachovia are offered services like consumer and commercial banking, asset and wealth management, capital markets and investment banking, community development finance, brokerage and insurance services. It has 700 offices and employs more than 19,300 people across different states in the US. Annually, more than 800 people retire from their services at Wachovia. The process of filing for retirement benefits is an arduous task. All the retiring employees have to travel to Atlanta for doing the required paperwork regarding the retirement benefit plans. Though the company bears the cost of traveling and arranged for the stay of the employees, the employees felt it was unnecessary

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and laborious process. On the other hand the management had to spend around $500,000 towards the stay and travel of employees. According to Gary George, Vice-President, human resources, —Retirement is a crucial moment of one’s life that comes after many years of dedicated service and as an employer; it‘s our goal to make the process as effortless as possible”. In order to solve the problem, Wachovia contacted Hewitt Associates, a global management consulting and employee benefits delivery firm, to help it solve the problem. Hewitt is the largest provider of benefits outsourcing programs and administers major benefit delivery programs to more than 12 million employees, retirees and their dependents. The firm delivers predefined benefit programs to more than 4.8 million employees and it recorded revenues worth nearly $1.3 billion in the year 2000. Wachovia asked Hewitt to develop a system that can later be integrated with its other HR processes and to enable employees of Wachovia to file their retirement papers online. Hewitt responded by saying that developing such a system would require a lot of money. Wachovia were losing so much money every year in taking care of the retirement benefits, in any case, they went ahead with the project and collaborated with Hewitt for developing an online retirement benefit system. The system was developed in record time, but the real problem lay with the implementation of the system. Employees were apprehensive about the performance of such a system and were reluctant to share pertinent details like bank details over the Net. Questions: 1. What should be the important features of an online retirement system? 2. Explain how staffing application software is useful for an organization like Wachovia Inc. 3. With which information systems can Wachovia integrate its online retirement benefits system? Explain the advantages of such an integration process. (ICFAI University, 2008)

Case 2 India Insurance was a small and upcoming insurance company that was started as a joint venture with Alliance Insurance, a US-based insurance company. India Insurance had a number of functional departments. There were departments for almost everything-from making policies to collecting premiums. There was lack of communication and coordination between these departments. Employee productivity was low, and turnover and absenteeism were high. Employees complained that their jobs were boring and monotonous. The only reason for the workers to continue on their jobs was the benefits offered by India Insurance. The company took good care of its employees and offered a range of family, health and medical benefits. At this stage, the company was planning to install an electronic data processing system for enhancing the productivity and efficiency of its employees. The executive committee of the company appointed Rajesh Katyal, the General Manager of the company, to study the feasibility of installing such a system. The study was aimed at knowing what the workers wanted from their jobs, motivational and hygiene factors at the workplace and whether installing an EDP system would really enhance the productivity and efficiency of workers. In order to conduct the study, Katyal took the help of an external Consultant. The Consultant remarked that installing such a

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system would require overhauling of the company’s present work system. During the course of their study, Katyal and the Consultant found that workers hardly had any attachment for their job. Some workers even said that they suffered from burnout and were planning to give up their jobs at the earliest. After a month, Katyal and the Consultant submitted a report to the executive committee. The major recommendation made in the report were the following: ¾ Overhaul the present functional structure and adapt a client-based structure. In the clientbased structure, each employee would be made responsible for handling transactions of a particular client at a time. ¾ The efficiency of the employee should not suffer because of the change in structure. ¾ In case of the EDP system, the cost-benefit analysis suggested that installation of such a system would certainly increase the efficiency of workers, but, on the other hand the prohibitive cost of the system would have to be absorbed by decreasing the value of benefits offered by the company. ¾ Managers in various functional departments were to be provided with cross-functional training to make them generalists. Questions: 1. Comment on the recommendations given by the Consultant and Mr. Katyal. Were they correct in their assessment? 2. How do you think workers will react if the EDP system is installed? 3. How can India Insurance improve coordination between its various departments? (ICFAI University, 2007)

Classroom Project

Classroom Project

Students can be divided into small groups of 4-5 members. Each group will be given an imaginary organization in a particular sector. A HR plan has to be prepared for the organization based on the details given and the secondary data available about labour and employment in the given sector.

Field Project

Field Project

The students, in groups of 4-5 members, are instructed to interview the heads of the HRM departments of firms in different industries and find out how HR planning is done in their firms and what are the precautions to be taken in planning HR requirement. They can also discuss the problems encountered in the planning process. The collected information is presented in the classroom to understand how HR planning is done in the corporate world.

Recruitment •

HRM - Indian Perspective

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Recruitment

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Key Terms Recruitment

Image Advertising

Lead-the-Market Pay

Yield Ratio

Personnel Policies in Recruitment Recruitment Sources Constraints on Recruiting Efforts

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Importance of Recruitment

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Review Questions

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Specialists Speak

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Case Study

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Classroom Project

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Field Project

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HRM – Indian Perspective

Reliance Industries logo

Reliance Industries Limited

Shri.Mukesh Ambani, Chairman

Reliance group of companies is a large conglomerate in India founded by Dhirubhai H. Ambani. Reliance was initially a textile company and emerged as a global leader in the materials and energy value chain businesses. Reliance Industries Limited is a Fortune Global 500 company and is the largest private sector company in India. At Reliance, to satisfy the man-power requirements, an HR Services company is set up instead of setting up an HR department in each office. Reliance Industries Ltd ensures learning activities at its manufacturing divisions. The belief in its people has been the foundation and corner stone of the group’s growth story. Campus hiring programme from the engineering, finance and management institutes has been far more robust, with wider coverage to ensure higher caliber as well as diversity. It focuses on building specialist skills and multiple cadres in the organisation to support its goals and aspirations. Several thousand man-hours of developmental intervention are undertaken to train the leadership teams on developing the second-line, compensation and benefits, executive coaching, rewards and recognition programmes and interviewing & selection. It has launched a specially tailored programme “Reliance Accelerated Leadership Programme”, in order to hire high caliber young talent into the Company and build a talent pipeline for the future. Accountability and responsibility driven variable pay programmes are designed uniquely for various levels. Six Sigma deployment focuses on improving process capability & reliability issues as per the needs of individual manufacturing sites. As a part of standardization of training & development of people with validation of their skill level, web based examination module has been developed for certification of Six Sigma Green Belts. HR policies are employee friendly keeping in view employee specific needs. The HR policies are being reviewed and benchmarked with world class organisations. An HR Shared Service Centre is established to ensure efficient and effective delivery of HR services to employees. RIL focuses on achieving excellence in occupational and personal health of its employees across locations. The Company has state-of-the-art Occupational Health Centres (OHC) at its

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manufacturing divisions and major offices. These OHCs are equipped with state-of-the-art diagnostic and therapeutic equipment and are manned by qualified occupational health specialists. RIL’s medical and occupational health departments are also in the forefront to prevent lifestyle diseases through regular health awareness sessions, daily health tips and personal counseling. Health promotional activities are also extended to employees’ family members staying at Company townships. There are full-fledged modern hospitals at its major townships catering health services to employees and their family members. The programme Change Agents for Safety, Health and workplace Environment (CASHe) is a movement encompassing the entire enterprise with thousands of improvement projects and creates a culture of implementing health, safety and environment improving projects at workplace. RIL continues to pursue world class operational excellence through the HSE Management System initiative, in strategic partnership with M/s DuPont Sustainable Solutions. Process Safety Management (PSM) has been further strengthened in FY 2010-11, through strategic initiatives for sustenance. One of the focuses was to conduct self assurance studies for the safety of the community through Process Hazard Analysis (PHA) and Quantitative Risk Assessment (QRA) in plants prioritized on risk basis. Implementation of recommendations emerging from such studies has resulted in evolving inherent safer measures in operations of such plants. RIL’s Central HSE audit programme is a critical component of the HSE governance process, which has been specifically designed to ensure that stakeholder expectations, HSE Policy and HSE Management Standards are being effectively implemented across the Group. The Company has further reinforced its ties with global institutions such as the Centre for Chemical Process Safety, the American Institute of Chemical Engineers, American Chemical Council and the British Safety Council, which give access to industry best practices.

Recruitment Recruitment is discovering potential applicants for the actual or anticipated vacancies in the organization. It involves attracting the potential employees and seeking viable candidates for particular jobs. As it is difficult to anticipate always exactly how many new employees are required in a given period of time in a given category, the role of HR recruitment is to build a supply of potential people that the organization can draw when the need arises. Recruitment creates a buffer between planning and actual selection of new employees. Recruitment activities are designed to influence: ¾ The number of people who apply for the job ¾ The type of people who apply ¾ The likelihood that those who apply will accept the positions, if offered

Recruitment is discovering potential applicants for the actual or anticipated vacancies in the organization. It involves attracting the potential employees and seeking viable candidates for particular jobs. Recruitment affects the number of people who apply for the job, type of people who apply and likelihood that those who apply will accept the positions, if offered.

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The goals of recruitment are to generate a large pool of applicants and to provide enough information for individuals to selfselect. The three areas of recruiting decisions are personnel policies, recruitment sources and the characteristics and behaviour of the recruiter.

Personnel policies are a generic term used for organizational decisions that affect the nature of the vacancies for which people are recruited. Policies in recruitment are internal vs. external recruiting lead-themarket pay strategies, employment-at-will and image advertising. Internal recruitment gives preference to current employees in promotions, transfers, and other career enhancing opportunities. External recruitment is searching for potential candidates in the open labour market.

A labour market is a geographical area within which the forces of supply interact with the forces of demand.

The two goals of recruitment are: ¾ to generate a large pool of applicants and ¾ to provide enough information for individuals to self-select out of the process. In general, all companies are required to make decisions in three areas of recruiting viz. Personnel Policies, Recruitment Sources and the Characteristics and Behaviour of the Recruiter.

Personnel Policies in Recruitment Personnel policies are a generic term used for organizational decisions that affect the nature of the vacancies for which people are recruited. Research has shown that the characteristics of the vacancy are more important than the recruiting sources or recruiters when it comes to predicting job choice.

Internal vs. External Recruiting In internal recruitment the companies give preference to current employees in promotions, transfers, and other career enhancing opportunities. There are organizations (Delta Airlines, WalMart, McDonald and etc.) where all jobs above the entry level are filled by internal promotions. There are three important components of internal labour market: ¾ Formal and informal practices that determine how jobs are organized and described ¾ Methods of selection of the internal candidates ¾ Procedures through which potential candidates are generated to fill the vacancies In an internal labour market every available job is advertised throughout the organization and any one can apply. Preference is given to internal candidates by withholding outside advertising until the job has been on the internal market for some time. External recruitment is searching for potential candidates in the open labour market. A labour market is a geographical area within which the forces of supply interact with the forces of demand. ¾ Employers seeking key employees will recruit far and wide, if necessary.

Chapter 4: Recruitment

¾ Employers do not face a single, homogeneous market for labour but rather a series of discontinuous, segmented labour markets over which supply-and-demand conditions vary considerably. The merits and demerits of internal vs. external recruitment are discussed elsewhere.

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‘Lead-the-market’ pay is a policy of paying more than the current market wages.

Lead-the-Market Pay Strategies To attract potential candidates who are likely to be influenced by compensation package, companies may opt for a ‘lead-the-market’ pay. It is a policy of paying more than the current market wages. Nowadays, organizations adopt pay forms other than wages and salary such as stock options to attract people.

Employment-at-will Policies Policies state that either the employer or the employee can terminate the employment agreement/relationship at any time irrespective of any reason. Companies which do not have employment-at-will policies have Due Process Policies. They detail the steps an employee can take to appeal a termination order. These policies prevent the employers from taking indiscriminate decisions. Recruitment details which emphasize due process, right to appeal and grievances redressal mechanism send a message to the potential candidates that job security is high. Research indicated that job applicants find companies with due process policies more attractive than companies with employment-atwill policies.

Image Advertising There are organizations which advertise, though there is no specific vacancy, just to promote them as a good place to work in general. ¾ Image advertising is particularly important for companies in highly competitive labour market.

Figure 4.1: Example of Image Advertising (Source:http:// www.tatapower.com/ advertisements.aspx)

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Employment-at-will is a policy that states that either the employer or the employee can terminate the employment agreement/relationship at any time irrespective of any reason.

¾ Though no specific job information is provided, image advertising is often effective as potential applicants develop ideas about the reputation of the firm. ¾ Advertising campaigns are often used to send a positive message about the organization. ¾ Language associated with the organization’s brand image is often similar to personality traits of individuals such as innovative, competent or sincere. ¾ People feel attracted to the organization if there appears to be a fit between the individual’s personality traits and the traits that describe the organization.

Image advertising is by organizations which advertise, though there is no specific vacancy; it is just to promote them as a good place to work in general.

¾ Whether the goal is to influence the perception of the public in general or specific segments of the labour market, job seekers form beliefs about organizations well in advance before any direct interviewing experience with the companies. Hence, it is critical for organizations to build up their reputation to attract potential candidates.

Recruitment Sources It is important to note that: ¾ The overall recruitment strategy revolves around the sources of recruitment of potential employees. ¾ As the total labour market is quite huge, any organization taps only a part of the supply market. ¾ The size and nature of the labour market explored depends on how and to whom the organization communicates its vacancies. ¾ People who respond to an advertisement in newspaper will be different from those who respond to internet advertisement.

Internal Sources It is promotion-from-within concept. Many organizations develop their own low-level employees for higher positions. The internal promotions occur through internal search of current employees who have applied for the posts, identified by the HRM department or referred by fellow employees. Advantages: ¾ It generates applicants who are well known to the organization.

Chapter 4: Recruitment

¾ The applicants are relatively knowledgeable about the vacancies. ¾ It is generally cheaper and faster. ¾ It is a good public relation and builds morale among the employees. ¾ Ambitious employees are encouraged. ¾ Probability of selection will be better as the information on the individual’s performance is readily available. ¾ Promoting from within can also act as a training device for developing middle-and top-level managers. Disadvantages: ¾ It may result in a workforce whose members think alike and may not be suited to innovation. ¾ In the name of building morale, there are chances that less-qualified internal sources may be selected. ¾ Internal searches may generate infighting among rival candidates for promotion and decrease morale levels of those not selected. ¾ It may result in excessive in-breeding i.e. the organization will be full of only insiders without any new blood to generate current ideas, knowledge, enthusiasm and higher productivity. ¾ It may lead to ‘We-have-always-done-it-that-way’ mentality.

How Internal Recruitment is Done? Internal recruitment is done in many ways viz. Job posting and bidding, referrals and direct applicants. Job Posting and Bidding: Organisations may communicate information about job openings through a process known as job posting and bidding. In this process the jobs are frequently posted on electronic bulletin boards or on regular bulletin boards. It can also announce in employee publications, special hand-outs, direct mail and public-address messages. ¾ In on-line job posting, employees looking for better positions post their names, resumes and the positions they are interested.

Figure 4.2: Modes of Internal Recruitment

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¾ Whenever a position falls vacant, the list of the employees who have posted their details is retrieved to select possible candidates for interviews. ¾ The employees are notified about the interview schedule and they can track their progress electronically through the various hiring stages. ¾ This system is effective only when the employees believe that the system is administered fairly. Direct Applicants: Direct applicants are the people who apply for a vacancy without prompting from the organization. Most of the direct applicants would have done some homework and concluded that there is a fit between themselves and the vacancy. This process is known as self-selection. Internal recruitment sources are job posting and bidding, direct applicants and referrals. In job posting and bidding, the jobs are frequently posted on electronic bulletin boards, regular bulletin boards, employee publications, special hand-outs, direct mail and public-address messages. Direct applicants are the people who apply for a vacancy without prompting from the organization. Referrals are people who are prompted to apply for a job by someone within the organization.

Referrals: These are people who are prompted to apply for a job by someone within the organization. ¾ Friends, relatives and acquaintances refer people for suitable jobs. ¾ Some companies even offer financial incentives to current employees for referring people who are accepted and perform acceptably. ¾ Employee referrals are an excellent means of locating potential employees for hard-to-fill positions. ¾ This is effective because employees rarely recommend someone unless they believe that the individual can perform adequately. ¾ Employee referrals may receive more accurate information about their potential jobs as the recommender often gives the applicant more realistic information about the job than could be conveyed through employment agencies or newspaper advertisements. Negative Side of Referrals: ¾ Recommenders may confuse friendship with job performance competence. ¾ Individuals often prefer to have their friends join them at their place of employment for social or even economic reasons such as sharing of accommodation/vehicle. ¾ Employee referrals may lead to nepotism i.e. hiring only the relatives of the current employees. ¾ This method of recruitment minimizes an organization’s desire to add diversity to the workplace.

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Nevertheless, employee referrals have universal application. In many organizations lower as well as higher level positions are filled by recommendations of current employees. Higher-level positions are generally referred by a professional acquaintance rather than a close friend. In addition to the above the following are also employed in internal recruitment. Human Resource Information System: Organizations create databases that contain the complete records and qualifications of each employee within the organization. ¾ Combined with search engines, the management can access the The other internal sources needed information and identify potential candidates for available jobs. of recruitment are HRIS, performance appraisal,

¾ Companies have developed resume-tracking systems that allow skill inventories and management to query on online database of resumes. ¾ Some companies have developed automated staffing and skills management software. ¾ HRIS allows an organization to rapidly screen its entire workforce to locate suitable candidates. ¾ HRIS is also used to predict the career paths of employees and to anticipate promotion opportunities. ¾ The system includes provisions for recording changes in employee qualifications and job placements as they occur. Identifying Talent through Performance Appraisal: Detailed elsewhere, performance appraisal is also used to identify potential candidates in addition to the more important task of developmental and career decisions. While conducting formal appraisals, managers are required to identify their subordinates’ potential for managerial or advanced technical jobs. Inventorying Management Talent: ¾ Skill inventories are an important tool for succession planning ¾ These inventories provide an indication of the skills employees possess and their experiences and interests. ¾ Skill inventories are used to identify high-potential employees who may be groomed as replacements for managers who are reassigned, retire or resign

assessment centers.

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But many companies do a poor job skill inventories leading to chronically shortage of talent. Figure 4.3: In-basket Exercise in Progress

Using Assessment Centres: An assessment centre is a process (not a place) by which individuals are evaluated as they participate in a series of situations that resemble real-life job situations. Many approaches are used in these centres: In-basket Exercises: The participants are given many documents, each describing some problem or situation requiring an immediate solution. They are thus forced to make decisions under pressure of time. They have to prioritize their activities.

An assessment centre is a process (not a place) by which individuals are evaluated as they participate in a series of situations that resemble reallife job situations. The approaches used are inbasket exercises, leaderless group discussions, role-playing and behavioural situations.

Figure 4.5: Role Play in Progress

Leaderless Group Discussions: In this activity, employees are to discuss a given topic. No clues will be given either to approach the topic or to the type of decision to be taken. The participants in the leaderless situation are evaluated based on their initiative, leadership skills and ability to work as a group member. Role Playing: The emploFigure 4.4: Leaderless Group yees are assigned different Discussion in Progress roles such as a HR manager, customer-relationship manager or a team leader and instructed to ‘act’ in a given situation. A trained assessor, using a structured rating scale, assesses the participants. Behavioural Situations: The participants are explained a particular work situation or shown a video clipping and a series of questions are asked about how they would behave under those circumstances. At the end of the process the assessors’ observations are pooled to develop an overall picture of the participants. A strong relationship is, generally, observed between the results of assessment centres and future performance in job.

Chapter 4: Recruitment

External Sources The type of external sources for recruitment varies with the position to be filled. Labour market determines which source is to be tapped. Generally, an organization at any given time will find it necessary to use several recruitment sources. Further, the source also affects the employee’s subsequent tenure and job performance. Advertisements: ¾ Advertisements are one of the most common methods of attracting applicants.

Figure 4.6: Explaining Behaviour Situations in Recruitment

¾ Though newspapers, trade journals and websites are commonly used media for job advertisements, many organizations use Radio, TV, Billboards, Posters and e-mails. ¾ Well-written advertisements highlight the importance of the position. ¾ Studies have shown that there is correlation between the accuracy and completeness of information provided in the advertisements and success of recruitment process. ¾ Advertisements typically include the information that the organization is an equal opportunity employer i.e. it does not discriminate people based on gender, race, religion and etc. ¾ The two most important questions to be answered in a job advertisement are (i)What does the organization need to say? and (ii) To whom does it say? ¾ Persons going through an advertisement must be able to get adequate information to evaluate the job and its requirement vis-à-vis their eligibility. The additional cost for long advertisement is to be compared with the processing cost of huge number of applications, if the advertisement is inadequate. ¾ Advertisement to recruit people for higher positions, specialized skills or when the resource is scarce must be widespread. ¾ The three important variables which influence the rate of response to advertisement are identification of the organization, labour market conditions and the quantum of specific requirements.

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Figure 4.7: Example of Website Advertisement

Figure 4.8: Example of Newspaper Advertisement

Figure 4.9: Examples of Poster Advertisements

Figure 4.10: Example of Banner Advertisement

Figure 4.11: Example of Billboard Advertisement

Chapter 4: Recruitment

Figure 4.12: T.V. as Media for Advertisement

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Figure 4.13: Radio as Media for Advertisement

Advantages of Advertisements: ¾ Advertisements can reach a large audience of potential applicants. ¾ Some degree of selectivity can be achieved by using newspapers and journals directed to a particular group of readers. ¾ Advertisements in newspaper with several regional editions can target the entire country or the appropriate geographic area for coverage. Disadvantages: ¾ The preparation of recruitment advertisement is time-consuming. ¾ It requires creativity in developing design and message content.

External recruitment sources are advertisements, employment agencies, educational institutions, college internship, professional associations, labour unions, executive search firms, unsolicited applications, e-recruitment and walk-ins.

¾ Many people who know they do not meet the job requirements may still apply causing severe burden on the organization’s administration in processing the large applications. Blind-box Advertisement: It is an advertisement that does not identify the advertising organization. ¾ Respondents are asked to reply to a post office box number or to an employment firm which acts as an agent. ¾ Reputed organizations generally do not go in for blind-box advertisement. ¾ When an organization does not like to publicize that it is seeking to fill an internal position or when it wants to recruit for a position where the incumbent is to be removed soon, a blind-box advertisement may be appropriate.

Job advertisements are a common source in many media. Blind-box advertisement does not identify the advertising organization.

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¾ Though this type of advertisement may attract qualified people, many will be reluctant to respond as they fear that the advertisement would have been placed by the organization in which they work. ¾ Blind-box advertisement has a bad reputation because some organizations place advertisements just to test the supply of manpower, to build a backlog of applicants or to identify those current employees who seek new positions. Employment Agencies: In general there are three forms of agencies viz. Public or Government agencies, Private Agencies and Management Consulting Firms. The major difference is the type of clientele served.

Partnering with college placement centres provides recruiters with access to good source of applicants.

¾ The main functions of these agencies are closely related to the unemployment benefits. ¾ Most government agencies tend to attract and list individuals who are unskilled and raw hands. Government companies are mostly required to tap this source. ¾ Private agencies are believed to offer positions and applicants of higher order. They may offer a complete line of services. Private agencies advertise the positions, screen applications against the criteria specified by the employer, and may provide guarantee to employees’ performance to the employer for certain period. The agency’s fee is mostly absorbed by the employer. ¾ Management consulting firms, known as ’executive search’ firms or ‘’head-hunter’’ firms are specialized private employment agencies. They specialize in middle-level and top-level executive placement as well as hard-to-fill top positions. They differ from others in their fees, their nationwide contacts, and the thoroughness of their job. Educational Institutions: ¾ Educational institutes provide young candidates with formal training but relatively little full-time experience. ¾ While high schools are a source of prospective employees for clerical and blue-collar jobs, colleges can be tapped for technical people. ¾ Many a time colleges provide candidates for white-collar jobs.

Chapter 4: Recruitment

Figure 4.14: Pre-placement Talk by the Companies

Figure 4.16: Students Taking Tests

Figure 4.15: Registration Process

Figure 4.17: Group Discussions

Figure 4.18: Personal Interviews ¾ Management schools are often approached to fill up managerial positions in all the functional areas of business such as marketing, finance, HR etc. ¾ In fact, for technical and managerial positions, colleges of higher studies and universities are the primary sources.

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¾ Colleges continue to remain a good recruiting source. Campusrecruitment at IIMs is a much talked-about phenomenon. ¾ Of late, due to mushrooming of colleges without adequate infrastructure and trained/experienced faculty, many a student miserably fail to meet the requirements of the campus recruiters resulting in the companies converging on a few better-off colleges. ¾ On the other hand, some employers fail to take advantage of the college and university resources because of poor recruitment planning. Consequently, many potential candidates will be missed. ¾ Further, many of the recruiters sent to college campuses are not sufficiently trained to have a dialogue with the interested students about their ambitions vis-à-vis the career opportunities or the openings available. ¾ Many a time the inexperienced recruiters visit too many colleges losing their focus. ¾ Inability of the applicants to visit the recruiting companies and the failure to obtain hiring commitments from the higher management cause the employers to lose well-qualified candidates. College Internship: ¾ Nowadays many students get placed through internship, a recruiting approach that has grown dramatically in the recent past. A good number of students, particularly in professional colleges, undergo internship before they graduate. ¾ Internships are win-win situations for both students and employers. The students can improve their skills, check out potential employers and learn more about their likes (and dislikes). Employers can make the interns contribute meaningfully during the internship. ¾ Partnering with a college or university’s placement centres provides recruiters with relatively quick and easy access to good source of applicants. Further, there will be feedback to recruiters on labour market conditions, effectiveness of on-and-offline recruiting advertisements. Guidelines to Enhance Campus Recruitment Efforts: ¾ Establishing a regular ‘presence’ on the colleges beyond just the on-campus interviewing period through summer placement of the students, consulting projects to the faculty, invitations to placement officers to visit company office/plants and even offering gifts and grants to the institutions.

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¾ Improving the content and specificity of recruiting materials through more details about the characteristics of entry-level jobs. ¾ Providing adequate time and resources to train on-campus interviewers to answer specific, jobrelated questions from the applicants. ¾ Arranging well-planned visits to the offices/ plants and taking care of all expenses ¾ Ensuring that the job attributes such as opportunities for creativity or to exercise initiative, promotional avenues, long term income potential etc. are comparable to those of the competing recruiters ¾ Taking effective part in job fairs Professional Associations: There are professional associations such as All India Management Association and its affiliates, National Institute of Personnel Management, Institution of Engineers etc. which offer placement service to members by listing members seeking employment in their journals. Participation of members in the associations helps them locating employment opportunities through interaction with other members.

HRM – In lighter vein

Professional associations list members seeking employment in their journals.

Labour Unions: Labour Unions can be a major source for recruiting bluecollar and technical/professional jobs. Many unions maintain a list of people, who are either relatives of the employees or acquaintances, to recommend Labour Unions can be a to the management for employment. Many a time the managements main source for recruiting blue-collar and technical/ volunteer to seek the help of unions whenever there is scarcity of labour. Executive Search Firms: Executive search firms, often called ‘head-hunters’ help employers find the right person for the right job, particularly for top positions.

professional jobs.

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Figure 4.19: Logos of a Few Executive Search Firms

¾ Firms such as ABC consultants, Ma Foi etc. seek out candidates with appropriate expertise and experience to match the positions of their client firms. ¾ The search firms generally do not advertise in the media. Search is done through contacts.

Executive search firms help employers find the right person for the right job, particularly for top positions.

¾ The client firm pays the fee. The candidate who gets placed need not pay any fee. ¾ The main criticism against the searching firms is that it charges fee whether or not the recruiting efforts results in finding a suitable candidate. ¾ Hiring of new CEOs from outside the organization through executive search firms has become accepted practice nowadays. ¾ As high-calibre executives are in short supply, a significant number of large corporates seek the help of executive search firms to fill the top slots. ¾ Due to many CEO related scandals in the recent past, the HR departments demand more from these search firms and they are also required to assist the Board of Directors in the careful selection of top executives. As engaging executive search firm is expensive and maintaining confidentiality is essential in the selection process, a few guidelines are listed to identify a good search firm. ¾ Market position of the search firm is defined by industries rather than as a jack-of-all-trades. ¾ It has understood how the client firm functions within the industry ¾ The firm is performance-oriented and its executives are adequately compensated. ¾ The firm combines the research and recruitment responsibilities into one function to enable the researcher/recruiter to make a more

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comprehensive presentation to the potential candidates on behalf of the client ¾ The firm uses a more personalized approach in identifying top performers apart from the routine primary research activity and compiling of database of potential candidates ¾ The search firm functions as a task force, particularly when the job involves multiple assignments or when placement is to be done immediately ¾ The firm is a member of an association such as the Association of Executive Search Consultants and follows the association’s practice standards and code of ethics Unsolicited Applications and Resumes: Many organizations receive unsolicited applications from people seeking jobs for the first time or those who are already in some jobs. These applicants may or may not be good prospects for employment. Though it is not a dependable source it cannot be just ignored. It is believed that people who contact the organization on their own initiative will be better employees than those recruited through campus interviews or advertisements. Some guidelines to treat the unsolicited applicants:

Unsolicited applications are from people who contact the organization on their own initiative.

¾ Any person contacting an employer for a job must be treated with courtesy and respect. ¾ If employment is not possible at present or in future, the applicant must be tactfully and frankly informed of the fact. ¾ It is not fair to tell the applicants on the face that their applications would be simply filed. ¾ All the queries must be answered promptly and courteously. ¾ It is a good public relation to note that any applicant treated well by a potential employer would talk high about the employer. Those who are treated poorly with tardy rejection letter or no reply generally would speak badly of the organization. Electronic Recruiting (Internet Recruiting or Cyberspace Recruiting): Nowadays many organizations use internet for recruiting. In future, newspaper advertisements and employment agencies may fade away as primary sources of conveying information about job openings and finding job candidates.

E-recruitment uses Internet for recruiting.

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How e-recruitment is carried out? ¾ One of the easiest ways to get into “e-recruiting” is to simply use the employer’s own website to invite applications. By using their own websites organizations can tune their recruitment and focus on specific people.

Figure 4.20: Example of erecruitment

¾ A second way to use the web to interact with a large, popular job sites such as Monster.com, Hotjobs.com, Naukri.com, Timesjobs.com or Careerbuilder.com. These sites attract a vast array of applicants.

Chapter 4: Recruitment

¾ Another technical innovation is videoconferencing which eliminates travel requirements but facilitates a more personal meeting between the employer and the applicant. It is mostly used in recruiting candidates from educational institutes. It allows a technical ‘face-toface’ meeting. ¾ Aggressive job seekers set up their own web pages – frequently called ‘websumes’- to offer their job candidacy. They make requests to the potential employers to check their website. These applicants have standard resume information, supporting documentation and even a video.

Figure 4.21: Popular Job Sites

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Advantages of e-recruitment: E-recruitment provides a low-cost means for most businesses to gain easy access to potential employees worldwide. ¾ Newspaper advertisements might have a life span of around 10 days, whereas internet advertisement may attract applications for over 30 days. ¾ It is fast as responses may start coming in at once ¾ It is also a way to increase diversity and find people with unique talents. ¾ In due course, when access costs to the internet decrease, on-line recruiting will be used for all kinds of non-technical jobs. ¾ The interactive nature of ‘e-recruiting’ allows individuals to fill out surveys that describe what they are looking for and what they have to offer the organizations. This type of immediate feedback regarding the applicants’ fit is both helpful to recruits and to the organizations, by quickly and cheaply eliminating misfit for either side. Disadvantages: ¾ The relative ease of responding to internet advertisements encourages unqualified job seekers also to apply. In walk-ins, people just walk in with resumes in response to advertisements.

¾ Applications may arrive from unrealistically far away geographic areas. ¾ If more young people or fewer minorities use the internet, the automated screening system may exclude higher number of older applicants or minority applicants. ¾ Smaller and less well-known organizations may not attract any attention to their own websites.

Figure 4.22: Example of Walk-in

Walk-ins: Here, people just walk in with resumes in response to advertisements. It is mostly adopted for lower-rung jobs. To maintain company’s reputation, ‘walk-ins’ must be treated courteously and diplomatically.

Recruitment Alternatives The recruiting sources discussed above are designed to locate and hire full-time, permanent employees. But, economic realities and management trends have created a different scenario for some firms to go in for temporary help, leasing employees, using independent contractors etc.

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Temporary Help Services: There are companies which supply temporary workers. Temporary workers are valuable, particularly, in managing short-term fluctuations in HRM needs. Started in administration, temporary hiring has Alternative sources of spread to many areas such as nursing, computer programming, accounting etc. Employers can hire temporary workers (part-time, just-in-time or contingent workforce) either through direct hires or through agencies. Direct hiring involves just hiring workers and placing them on the job. The employer pays these people directly as in the case of other employees but classifies them separately from regular workers. If hired through agencies the agency usually pays the salaries and benefits, if any, received from the employer.

recruitment are temporary help services, older workers, single parents, differently-abled, employee leasing and independent contractors.

Why temporary hiring has become popular? Employing contingent or temporary workers owes its popularity to many things: ¾ Corporate downsizing resulting in many experienced workers Temporary workers are jobless. valuable in managing ¾ A contingency measure to continue production when permanent short-term fluctuations in HRM needs. Older workworkers are on vacation or sick. ¾ A desire for higher productivity. Productivity is measured in terms of output per hour paid for. Overall productivity increases if employees are paid only when they are working as in the case of contingent workforce. ¾ Temporary workers are, generally, not paid any benefits, which is a saving for the employer. ¾ Employers can reduce or increase the temporary workforce depending on their requirements which is not possible in the case of permanent workforce. ¾ Employment costs are lower than that of permanent employees. ¾ Temporary employees can be dismissed anytime. Older Workers: Because of buyouts, early retirements and rightsizing older people are available as a source of recruitment. Many organizations look to older workers for many reasons like flexibility in scheduling, low absenteeism, high motivation, skill, experience, mentoring ability etc.

ers are hired for flexibility in scheduling, low absenteeism, high motivation, skill, experience and mentoring ability. Single parents are to be given better worklife balance. Differently-abled workers make a competent workforce. Leased employees typically join an organization for longer periods. Independent contractors are employed to do specific work at a location on or off the company’s premises.

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Though recruiting and attracting older workers involves any one or more of the popular methods (advertising, employment agencies, e-recruitment etc.), a comprehensive effort is needed because older workers have some special preferences. The following efforts may be attempted to attract older people: ¾ Developing flexible work options such as ‘mini-shifts’. ¾ Creating or redesigning suitable jobs. Figure 4.23: Old People Waiting for Employment

¾ Offering flexible benefit plans such as longer vacation. Recruiting Single Parents: Surveys indicate that about two thirds of all single parents are in workforce and this group is an important source of recruitment. Why single parents hesitate to take up jobs? The reasons for single parents hesitating to take up jobs are varied: ¾ Working single parents (mostly single mothers) state that their work responsibilities interfere significantly with their family life. ¾

They feel it is a no-win situation as the challenge of having to do a good job at workplace and being a good parent is not easy.

¾

They also view themselves as having “less support, less personal time, more stress and greater difficulty balancing job and home-life” than other working parents.

How to attract single parents for recruitment?

Figure 4.24: Single Parents Waiting for Employment

Devising a suitable program for attracting single parents should begin with understanding the problems they encounter in balancing work and family life. ¾ The first step is to make the workplace as user friendly as practical ¾ Organizing regular, on-going support groups and other forms at which single parents can share their concerns

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¾ Arranging flexitime programmes to suit the single parents’ home life. ¾ Training the supervisors to have an increased awareness of and sensitivity to the challenges the single parents face. The Disabled: The disabled, now addressed as differently-abled people, provide an excellent and largely untapped source of competent, efficient labour for jobs ranging from information technology to receptionist to creative advertising. Employee Leasing: While temporary workers come into a company for specific short-term assignment leased employees typically join an organization for longer periods. Of late, employee leasing by professional employer organizations (PEOs) has become popular. Basically a PEO takes over the management of the client company’s HR tasks which include hiring, payroll, performance appraisal, benefits, administration and day-to-day activities. Under a leasing agreement, individuals work for the leasing firm. Benefits of Employee Leasing: ¾ When an organization needs specific employee skills, the leasing firm provide trained employees. ¾ It is less expensive as the acquiring organization pays only a flat fee for the employees. ¾ The company is not directly responsible for the benefit or other costs such as PF, ESI etc. ¾ As employees return to the leasing firm once the assignment is over, there is no cost associated with layoffs or discharge. ¾ Leased employees are well trained. They are screened by the leasing firm, trained appropriately and go to the client organizations with an unconditional guarantee. ¾ If an employee is found inappropriate, the company receives a new employee or the fee is returned.

Figure 4.25: Differently-abled People Waiting for Job Opportunities

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Independent Contractors: Companies may hire independent contractors, often referred to as consultants, to do specific work at a location on or off the company’s premises (claims processing or medical and legal transcription activities). Independent contractor arrangements benefit both the organization and the individual. The hiring company is benefitted by not incurring social security costs. It can also retain good workers. The hired individual can do the job assigned at his own convenient schedule.

Which Sources are Most Popular with Employers and Job Applicants? Popular sources with employers and job applicants are informal contacts, private employment services, walk-ins, write-ins and internal recruitment.

Surveys among employers indicate that: ¾ Informal contacts are used widely and effectively at all occupational levels. ¾ As required skill levels increase, use of public employment services declines. ¾ Except for entry-level, un-skilled and semi-skilled positions, internal recruitment is the major source of recruitment. ¾ Walk-ins, Write-ins and internal recruitment are frequently used by larger firms.

Improving the Effectiveness of External Recruitment Given the uncertainties in external recruitment, it is not easy to determine whether the efforts in external recruitment are effective/or cost-effective. Some of the methods to maximize the probability of success are mentioned below: Yield Ratio: It is the percentage of applicants from a recruitment source that make it to the next stage of the selection process. Eg. If 200 resumes are obtained from an agency and 20 of the applicants are asked to attend an interview, the yield ratio is 10(20X100/200=10). This yield ratio is recalculated for each subsequent stage in the selection process (Group discussion, Aptitude testing, Personal interview, Final offer etc.)which would result in a cumulative yield ratio. By calculating and comparing yield ratios for each recruitment, the efficiency of different recruitment sources can be assessed. To make the process efficient, the source which shows the highest yield ratio could be selected.

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Costs of Recruitment: The effectiveness of a source can be assessed by comparing the costs of recruitment of other sources. The cost of recruitment is calculated by the formula, SC/H = AC+AF+RB+NC/H Where SC = Source Cost H = Total number hired AC = Advertising Cost AF = Agency Fees RB = Referral Bonuses paid NC = No Cost hires, Walk-ins, No profit agencies etc. Source cost combined with yield ratios can provide valuable information to select the best source. Organizational Recruiters: Depending on the company’s policies, the people who attend to recruitment differ from company to company. In large organizations professional HR recruiters are hired. In smaller organizations HR managers themselves take up the responsibility of recruitment. In the absence of a formal HR department, recruitment may be done by managers and/or supervisors. In certain cases, members of work team take part in selecting new members. Regardless of who does the recruiting, it is important that the recruiters have a good understanding of the knowledge, skills, abilities, experiences etc. Recruiter’s Functional Area: Organizations must choose whether the recruiters are HR specialists or line managers. Many a time the applicants find a job less attractive and the recruiter less credible when he/she happens to be HR specialist. Though the role of HR specialists is not discounted, it is imperative that they are knowledgeable in the field for which they are recruiting. Recruiter’s Traits: There are two important traits required of a recruiter, one is ‘warmth’, that is the degree to which the recruiter cares about the applicant and enthusiastic about his/her potential and the other is informativeness. Applicants, generally, respond more positively to recruiters who are warm and informative. Recruiter’s Realism: As applicants are highly sensitive to negative information, recruiters are expected to exaggerate the positive features of

Effectiveness of external recruitment is determined by yield ratio, cost of recruitment and recruiters’ functional area, traits and realism. Yield ratio is the percentage of applicants from a recruitment source that make it to the next stage of the selection process. Source cost is based on total number hired, advertising cost, agency fees, referral bonuses paid, and etc.

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Constraints on recruiting efforts are organization image, job attractiveness, government influence and recruiting costs.

the job and to downplay the negative features to attract potential candidates. But, if the recruiter goes too far in a positive direction, the candidate can be misled resulting in a serious case of unmet expectations and a high turnover rate. Unrealistic job descriptions may lead the applicants to believe that the company is deceitful.

Constraints on Recruiting Efforts Constraints are factors that can limit recruiting efforts. A few specific constraints are mentioned below: Organization Image: It is quite common that a company of high repute i.e., a company with a good image can attract more applicants. A poor image may limit the company’s attraction to applicants. When the potential candidates come to know that the company is from a declining industry, engages in practices that result in a polluted environment, produces poor quality products/services, does not bother for the employees or has unsafe working conditions, they hesitate to respond the offer.

Figure 4.26: Constraints on Recruiting Efforts

Job Attractiveness: Unless the position to be filled is attractive, recruiting a large and qualified pool of applicants will be difficult. Jobs which are viewed as boring, hazardous, anxiety-creating, low paying or lacking in promotion potential fail to attract candidates. Government Influence: In certain cases the employer can no longer seek out preferred candidates based on non-job –related factors such as physical appearance, sex or religious background due to government’s instructions regarding recruitment. Recruiting Costs: As recruiting efforts are expensive, budget restrictions put a time limit on searches. When an organization considers various recruitment sources, it should consider effectiveness, that is, which source is cost-effective.

Chapter 4: Recruitment

Importance of Recruitment Recruitment is the base of human resource function as it creates a pool of manpower that is interested to work with an organization. It involves creating a better image of an organization that attracts potential applicants. In a competitive job market, when there are many avenues for work in various sectors, organizations have to carve a niche for themselves to be a preferred employer of choice. Better image of organizations cannot be achieved in a short span of time. It involves continuous efforts on all aspects of human resource policies, practices and culture in organizations that will foster better working environment thereby propagating a better brand image. Recruitment gains importance in this regard as it decides the quality of workforce that gets into an organization. It also ensures smooth supply of a pool of applications from which future vacancies can be filled up in case of requirements. It reduces costs of hiring when well planned strategies are laid out to maintain an ample reservoir of eligible applicants or choosing better avenues for sourcing them. Summing up, there is no HR system without recruitment efforts as the system depends on talented pool of employees in an organization.

Review Questions Review Questions

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Recruitment is important as it is a base of HR function, creates a pool of manpower, gives a better image of an organization, makes a firm preferred employer of choice, decides the quality of workforce, ensures smooth supply of a pool of applications, reduces costs of hiring and maintains an ample reservoir of eligible applicants.

–P arimal Joshi Parimal

HRM – In lighter vein

Answer in brief

1. What is recruitment?

7. What is assessment centre?

2. What is meant by ‘lead-the-market-pay’ strategy?

8. What is in-basket exercise?

3. What is ‘employment-at-will’ policy?

10. What is the importance of recruitment?

4. What is image advertising?

11. What is electronic recruiting?

5. What is job posting and bidding?

12. Which sources of recruitment are popular?

9. What is blind box advertisement?

6. What is meant by referrals? Answer in detail 1. Discuss the various personnel policies in recruitment.

2. Critically analyze the various internal sources of recruitment.

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3. Critically analyze the various external sources of recruitment.

5. How the effectiveness of external recruitment can be improved?

4. Discuss the various alternatives of recruitment.

6. Discuss the various constraints on recruiting efforts.

Specialists Speak

Specialists Speak Specialists Speak - 1

Pankaj Sinha HR Executive, R Systems International Ltd., Chennai

Challenges Faced in the Field of Recruitment As recruiters in the Human Resources department for an IT Company, we get to face a lot of diversified challenges through the course of our work. The biggest challenge is to find the right quality candidate for any position. For a mid level or smaller organization, it becomes tougher to find quality candidates. In India, Engineering Education has become more of a joke and shame. Ninety percent of the candidates passing out of these engineering colleges are not up to the mark as compared to the Industry standards. The quality of candidates is very poor. They do not have proper, basic communication skills or written skills. Let us not even talk about their technical skills. Leaving IITs, IIMs & a few other colleges, the quality and standard of education in our country is not up to the mark. How can we expect the industry to grow to the next level with such work force? We need major changes in our technical education system. Engineering colleges need to understand the needs of the industry. The technologies are changing every year. There are new advanced technologies coming up. There is a need to constantly update the syllabus year after year. Engineering schools do not give much importance to the soft skills of a student. Good soft skills have become an urgent need of the industry. We need people who can interact well with our clients and customers. The problem doesn’t stop with only freshers coming out of these engineering colleges. The experienced people are also not updating themselves. A lot of people do not even research about the company where they are going for an interview. This shows how much they are interested in the job. The passion for the job is clearly lacking. In IT industry especially, seventy five percent of the people lack passion for their jobs. They are more interested in monetary rewards or opportunities abroad. Needless to say, passion for your job is very important. This will keep you motivated in your work and bring in a lot more ideas within you regarding your work. It will also help you in your career, the organization and the industry. We need to think big to achieve big. The number of students graduating is large but where is the quality? As a recruiter, we still need quality candidates for our requirements. We need to search for some bright spots.

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The Industry has become bigger and the competition has risen. Candidates also generally have 2 or 3 offers in their hands. There are chances of candidates dropping out the offer at the last moment. There is constant pressure. Despite your regular follow ups, the candidate may join some other organization. You cannot have back up resources for all your requirements. This becomes a very challenging situation. Finally, there are a lot of candidates coming up with fake experiences in their resume and also fake pay slips & bank statements. Most organizations do background verifications for their employees. The truth will finally come out. It is no use showing fake experience, you will have a red mark in your career. If there is a will to get into the right job of your liking, there will be a way. You can learn some new skills and work hard on your soft skills. Initially you may get a job in a small organization, but that can be a stepping stone to your success. The dishonest candidates with no ethics will be of no value to any organization. The recruitment field has many challenges but that makes it a very interesting career option too. (Source: http://www.contentwriter.in/articles/hr/challenges-recruitment-field.htm) Specialists Speak - 2

Ashish Bakshi Senior Manager – HR, MediaTek India

The Finishing Line We have no choice but to run the rat race. However, we need to accelerate the pace As hiring activities slump amidst a sluggish and uncertain economy, it may not be the best idea to switch jobs, for the sole purpose of ridding oneself of professional frustrations. The tough macroeconomic environment has led top firms to augment their focus on people in an attempt to retain talent and ensure personal and professional growth for all employees. Companies are becoming more and more demanding, and unless one has an exceptional qualification and performance record, merely switching to a new job because one is discontented may not be the best idea. New organisations will have double the expectations and working for a paltry sum along with added exertion makes little sense. The best and wisest decision in today’s jobs scenario would be to stay with one’s current employer and engage in activities, workshops and programmes created by the organisation to boost the working atmosphere. It is necessary for both the employer and employee to feel that there are certain goals, which are yet to be achieved. Work that involves full utilisation of talent will result in greater productivity. Keeping the spirits high is a job in itself, and a constant struggle that all parties within an organisation must keep working towards for successful career growth of its employees and sustaining the workforce and retaining growth.

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Some great ways to boost your mood and growth at your workplace may well begin with something as simple as prioritising your work tasks. List down all the tasks for the day, and place the most important and urgent ones on top. Similarly, determining your short-term and long-term goals will help evaluate your progress frequently. Another step towards fast-tracking your career growth can be through ‘value-adding’ tasks. Value-adding tasks may include meeting deadlines, adding extra effort, approaching your task with different perspectives, thus enhancing productivity. ‘Value adders’ see the completion of an allocated task as only the starting point. But to add value, one has to have a certain level of knowledge and expertise. Job seekers want bright employees whose thinking will really contribute to their business. A definite way to increase your value on the job is to keep learning. When you learn, you would want to educate others and impart that knowledge. When you spread that knowledge is when you contribute and make your presence felt within the organisation. Small changes in lifestyle such as self-discipline and aligning individual goals with organisational goals as much as possible can go a long way in defining your growth chart. Companies prefer a narrow gap between individual and organisational goals. Employees who are aligned closest to the organisation’s goals and visions are likely to grow faster as compared to those who are less closely aligned. (Source: http://itsmyascent.com/cms?targeturl=web%2Fitsmyascent%2Fcareer-advice%2F%2Fasset_publisher%2FnL0N%2Fcontent%2Fthe-finishing-line)

Case Study

Case Study Case 1

Cisco sources revealed that the company had a policy of attracting the ‘top 10-15%’ people in the networking industry. It believed that if it could get the best people in the industry and retain them, it would remain the industry leader. According to Cisco’s vision statement, “Attracting, growing and retaining great talent is critical for sustaining Cisco’s competitive advantage.” Thus, effective recruitment was used as a powerful strategic weapon by the company. The company began to use revolutionary techniques like the ‘build-the-buzz’ strategy, which was centered on the primary market for its products, i.e., the Internet. Cisco’s recruiting team identified the candidates whom they felt the company ‘should hire,’ and then figured out the way those potential candidates did their job hunting and designed hiring processes to attract them to the company. Cisco recruiters targeted even passive job seekers – people who were happy and successful in their current jobs. Barbara Beck (Beck), Vice President, Human Resources said, “The top 10% are not typically found in the first round of layoffs from other companies, and they usually aren’t cruising through the want ads.”

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Cisco changed the way it posted advertisements in newspapers. Instead of listing specific job openings, the company featured its Internet address in its ads and invited prospective candidates to apply. This move helped Cisco to direct all job seekers to its website where it could inexpensively post hundreds of openings and provide information regarding them. It also advertised its website in cyberspace to reach candidates who surfed the net from around the world. The company was thus able to monitor and measure its recruiting programs through the number of visits to its site. Since most people visited Cisco’s website from their jobs, the company could identify their place of work. Cisco worked towards removing some of the frustration associated with applying for jobs. The company learned to attract happily employed people through focus groups. These focus groups targeted senior engineers and marketing professionals in other companies and found out how they spent their free time, the websites they visited and the how they felt about job hunting. These insights helped the recruiters. For example, it was found that most professionals like to watch movies in their free time, websites on ‘corporate cartoon Dilbert’ were extremely popular and most professionals hated job hunting. Cisco, thus, linked its website to the Dilbert web page (www.dilbert.com), which registered around 2.5 million hits per day, mainly from engineers and Internet-savvy managers, It also bought space on websites like Travel Quest (www.travelquest.com), a reservation service provider. These steps turned Cisco’s website into an extremely useful recruiting tool. The website also offered features through which applicants could fill their resumes online or create one with the help of Cisco’s resume builder. In this way Cisco attracted active and passive job seekers. The focus group’s exercise made Cisco realize that a candidate would approach the company if he had been informed by a friend about better opportunities at Cisco. This led to the launch of the friends program in April 1996. Cisco also reached out to potential applicants through a variety of routes which were unusual in recruiting. It began frequenting art fairs, beer festivals and certain annual events in which people from Silicon Valley participated. These places proved to be very ‘fruitful hunting venues’ as they attracted young achievers from various successful infotech companies. Cisco recruiters mingled with the crowd, collected business cards from prospective candidates and spoke to them informally about their careers. More than 1,000 Cisco employees volunteered for the Friends program, attracted by the referral fee, which started at $ 500 and a lottery ticket for a free trip to Hawaii for each prospect they befriended and who was ultimately hired. In this program, Cisco employees were matched up with people who approached the company as prospects and who shared similar backgrounds and skills. The Cisco employees then called the prospects to inform them in their own words about life at the company. Cisco advertised the friends program in movie theaters in San Jose and received around 100 to 150 applications each week. By 1997, about one third of new recruitments were made through the Friends program. Cisco launched a tool called Profiler on the employment page of its website to accelerate and standardize online resume submission. The Profiler asked applicants to provide educational and employment information through appropriate selections from pull-down menus. Cisco also found that applicants and recruiters were not totally comfortable with, the time-consuming recruiting process. To speed up the hiring process, Cisco hired in-house headhunters to identify qualified

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candidates for managers. After streamlining its recruitment policies, 1996, Cisco conducted an employee survey to find out how the new recruits felt on their first day at work. The survey showed that some new recruits felt lost on their first day - their phones did not work, their computers had no software and if it did they had no idea how to use it. It was also found that most of the employees did not get their email addresses for two weeks. To address the above problems, Cisco launched Fast Start, a employee-orientation initiatives. Cisco installed computer software, which tracked the hiring process and alerted the team about the new recruit’s arrival. As a result, every new recruit started with a fully functional workspace and a whole day of training in desktop tools. Cisco believed that its new recruitment philosophy should also be made a part of the overall corporate culture. By late 1999, Cisco’s job page was recording around 500,000 hits per month. The company generated a stream of reports about who visited the site and fine-tuned its strategy accordingly. By the time the new recruitment initiatives were established, Cisco, which was hiring approximately 8,000 people a year, received 81% of the resumes were from the web. Eventually, 66% of the new recruitments were from the candidates who had sent their resumes through the Cisco website. It was also reported that about 45% of company’s new recruits came from the Amazing People Program. Cisco’s hiring cycle also came down to 45 days from 68 days. The recruitment costs in this ‘direct mode’ amounted to $6,556 per capita, which was around 40% below the industry average. Referral rates at Cisco were twice the industry norm and that created a performance edge as most recruits were qualified employees with vast experience. By 2001, referrals and the friends program accounted for 50-60% of new employees. Most importantly, the retention rate at the company had also increased. The employee turnover figure was 6.3% in 1999, a very low rate compared to the industry norms, which varied from 18-28%.According to company sources on average Cisco employees accessed the corporate e-HR site 16 times a day for information about job cuts. Analysts claimed that Cisco’s innovative and aggressive recruiting initiatives were to a large extent responsible for the company’s expansion at 40% per year and recruiting 250 employees every week despite the global dot-com slump. Questions: 1. According to Cisco’s vision statement, “Attracting, growing and retaining great talent is critical for sustaining Cisco’s competitive advantage.” Analyze the various recruitment strategies adopted by Cisco. 2. Cisco believed that its new recruitment philosophy should also be made a part of the overall corporate culture. Explain the various key aspects that are to be considered in recruitment philosophy by companies like Cisco. Discuss how Cisco is benefitted by adopting innovative recruitment philosophy. (ICFAI University, 2009)

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Case 2 Mr. Felix is a final year MBA student. He has done well in exams. During the campus recruitment, he was selected by a well known company in Mumbai. Firm’s Director insisted him to visit his factory. Felix spent one full day in the factory, meeting officials and visiting various sections. Before leaving the Personnel Manager confirmed that they are willing to hire him subject to passing certain selection tests and formal interviews. He was asked to report to the factory after his final examination. Having gone back to the college, he wrote to the firm thanking them for the offer but regretted his inability to join them. Questions: 1. What made Felix to refuse the job offer? 2. If you are the Director of the Management School, what steps do you like to take? (University of Madras, December 2011)

Classroom Project

Classroom Project

Students are put in small groups of 4-5 members and the following tasks are assigned for presentations and discussion to bring out more insights. (i) Each group is assigned to an e-recruitment website and the documents or data requirements needed to be uploaded in the site are to be listed and presented by the group. (ii) Each group has to collect data on recruitment opportunities and other career opportunities like competitive exams, higher studies etc. and present it to the class on a weekly basis. This will enable them to know the job market, skill sets needed, present level of compensation, etc.

Field Project

Field Project

The students, in groups of 4-5 members, are instructed to visit firms of various industries and collect the following information on recruitment: ¾ What types of recruitment the firm generally resorts to? ¾ Which mode of recruitment is effective in attracting applicants? ¾ What is the approximate annual budget for recruitment? ¾ Does the firm engage any outside agency for recruitment? ¾ Does the firm require elaborate recruitment process? If yes, what are the compelling reasons? The details are discussed in the classroom.

Selection •

HRM - Indian Perspective

•

What is Selection?

•

Selection Process

•

Decision Strategy

• •

Key Terms Selection

Reliability

Validity

Initial Screening

Comprehensive Interview

Employment Tests

Background

Approaches in Hiring Decision Best Practices in Recruitment and Hiring in Top Companies

•

Review Questions

•

Specialists Speak

•

Case Study

•

Classroom Project

•

Field Project

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HRM - Indian Perspective

Britannia Employees

Britannia Industries Limited

Shri.Nusli Neville Wadia, Chairman

Britannia Industries Limited is an Indian food-products corporation based in Kolkata, India. The Company's principal activity is the manufacture and sale of biscuits, bread, rusk, cakes and dairy products. The company was established in 1892. Britannia is one of India's 100 Most Trusted brands listed in The Brand Trust Report. They believe in creating growth opportunities by encouraging "idea leadership" and taking responsibility for decision making. Britannia gives a great learning experience in varied roles enabling adaptability in an ever changing business environment. The work culture can be characterized by strong performance focus coupled with high result orientation. Britannia is incomplete without an essential ingredient…FUN!!! Every new joinee finds a friend and a mentor in every Britannian he or she encounters during his/her tenure in this organization. The family like culture of this organization fuels the life-blood of every Britannian and has helped strengthened bonds manifold across almost a century. Britannians are hand-picked to perpetually ensure market leadership and generate exemplary performance in every function. Britannians exhibit Leadership behaviors (fondly called as BULBs - Britannia Universal Leadership Behaviors) Integrity, Team Orientation, People Development, Learning Orientation, Customer Orientation, Quality Orientation, Drive for Results, Entrepreneurial Spirit, System and Process Orientation and Communication. The entry level recruitment is trainee and lateral recruitment is for people with two or more years of experience in all functional areas. The recruitment process includes application through online, consultant, direct or employee referrals; shortlisting; multiple rounds of interview; final offer; pre employment medical examination; and appointment. The search for young, enthusiastic talent is always on at Britannia. The work culture at Britannia is characterised by strong performance focus coupled with result orientation. An innovative company like Britannia is always on the lookout for innovative, young minds. The management philosophy

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encourages nurturing of talent through grooming of bright and young entry-level managers. The organisational culture provides a perfect blend of fun and learning that helps in the overall development of talented individuals recruited into the system. The main sources of recruitment of Management Trainees are Business Schools; Engineering Institutes; Food Technology Institutes and ICAI/ICWAI/ICSI/ICFAI and other such institutes offering professional courses. An alternative route is for candidates to apply directly to Britannia or through a recruitment consultant. The distinguishing factor between MTs and other lateral hires would be in terms of their experience and qualifications. In this case, however, candidates may or may not have prior experience. For experienced candidates, 1 year or less would be the maximum cap to be eligible for the Management Training Scheme. Campus recruitment has two stages, viz. Summer Trainee Recruitment and Management Trainee Recruitment. Summer Training takes place for a period of two months where students from Business Schools and Functional Institutes (Engineering/Food Technology/Finance) work on projects with Britannia in the following functional areas - Marketing; Sales and Distribution; Operations and Supply Chain; Human Resource Management; Finance and Quality Assurance. Summer Trainees at the end of their training tenure are taken through an evaluation process to assess placement within the company as Management Trainees. This happens through a Pre-Placement Interview by a panel that assesses the candidate on his/her project and his/her potential to fit into the organisation. Management Trainees are recruited on the basis of actual vacancies in the system. They are recruited either through Pre-placement offers made to exceptional Summer Trainees or through direct Campus Recruitment. MTs join the covenant grade as Management Trainee - (function), and are absorbed into the following functions - Sales and Distribution; Operations and Supply Chain; Human Resources; Finance and Quality Assurance. The Marketing function has so far been insulated from the Management Training Route as entry level marketing positions require knowledge of Sales or prior knowledge of Marketing (lateral route). Once MTs are on-board, they are taken through a series of carefully designed Training Modules that encompass almost all functions of the business. The Training Modules are interspersed with live projects in different functions to test their knowledge and problem-solving abilities. Ideally, any Management Trainee would need to complete at least 2 live projects related to his/her stream of interest and one live project in a related function or a function of choice. At the end of the training period, all MTs are assessed on the basis of their learning and project performances by a cross-functional panel consisting of Functional Heads. On successful completion of their Training Program, MTs are confirmed as Managers in their respective functions. The total tenure of Management Training is 18 months for a Technical Trainee (Engineer/Food Technologist) and 12 months for all other trainees.

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Selection is the process of eliminating inappropriate applicants and choosing right persons who fulfill the requirements of the existing or future job openings. Selection program aims at personjob fit and person-organization fit. Applicants whose KSAOs are well matched to the jobs they are hired for, perform better and are more satisfied. Many companies select individuals who match the values and culture of the organization to have effective teams and flexibility.

Recruitment triggers the prospective employees to file applications for jobs. While recruitment is the process of encouraging people to apply for jobs, selection is the process of eliminating inappropriate applicants. Comparatively selection assumes more importance than recruitment. Careful selection is important on the following counts: ¾ The performance of a firm, to a large extent, depends on the employees. Employees with the right skills and attributes do a better job than those who lack appropriate skills or those who are abrasive or obstructionist. ¾ Screening of employees using well-defined tests, past records or references will avoid people with undesirable behaviours such as stealing, vandalism, voluntary absenteeism, alcoholism etc. ¾ As recruitment and hiring are costly, a firm cannot afford to indulge in frequent selection processes. ¾ It is time consuming. ¾ There are legal implications of incompetent selection.

What is Selection? Selection is the process of choosing right persons who fulfill the requirements of the existing or future job openings. Though selection program is the formal responsibility of the HR department, line managers make the final decision about hiring people in their units. Selection program aims at person-job fit and personorganization fit. Person-job Fit: By identifying competencies through job analysis, firms can use selection methods such as written tests, interviews, psychological tests etc to measure applicant's KSAOs (Knowledge, Skills, Abilities and Other factors) against the competencies required for the job. It has been found that applicants whose KSAOs are well matched to the jobs they are hired for, perform better and are more satisfied. Person-organization Fit: Apart from meeting the requirements of job, firms want their prospective employees to fit into the organizational set-up. Many

Chapter 5: Selection

companies place a high priority on selecting individuals who match the values and culture of the organization to have effective teams and flexibility. Many a time potential candidates with excellent technical skills are rejected as they fail to fit into the organizational culture.

Selection Process The procedure adopted in selecting candidates may differ from organization to organization and within the organization. Also it may differ based on the type of job. Nevertheless, there is a common selection process followed by many companies. The steps in the selection process as described by Decenzo and Robbins (2008) are given below:

Note: The comprehensive approach completes all steps before a hiring decision is made

Figure 5.1: The Selection Process

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Steps of selection process are initial screening, completing the application form, employment tests, comprehensive interview, background examination, conditional job offer, medical/physical examination and permanent job offer. Initial screening involves screening enquiries and screening interviews. Screening enquiries help in the elimination of applicants based on job description, job specification, experience and education. Screening interview is an opportunity to find out the seriousness of the candidates in applying for the job.

Application forms can be weighted application form, a special type of application form that uses relevant information about the applicant to determine the likelihood of job success and online application form. Nowadays many organizations are accepting online applications. There are organizations which accept only online applications.

Initial Screening Initial screening is the first step in selection process involving two components viz. Screening enquiries and Screening interviews. Screening enquiries help in the elimination of applicants based on job description, job specification, experience and education. Screening interview is an opportunity to find out the seriousness of the candidates in applying for the job. Conference call interviews or video conferencing are of help in the screening process.

Completing the Application Form After completion of initial screening, company-specific employment form is used to generate specific information needed by the company. In general, the application form gives a job-performance related synopsis of applicant's educational background, experience, skills and accomplishments and some relevant personal details. There are organizations which collect as much information as possible (Address, Birth place, Nationality, Religion, Citizenship, Education, Relatives, Experience, Gender, Age, Marital status, Family status, Disability etc.) Weighted Application Form: It is a special type of application form that uses relevant information about the applicant to determine the likelihood of job success. The information gathered help recruiters differentiate between potentially successful and unsuccessful job performers. The recruiter identifies the important items which are essential or appropriate for a particular job and selects those applications which contain these items on priority. Some firms, while allocating points to each relevant item in the application, allot extra points (weighted) to the items which are more relevant to the job. Online Applications: Nowadays many organizations are accepting online applications. There are organizations which accept only online applications. Some companies which do not want to get flooded with online applications frequently contract with companies such as Monster.com, Career builder etc. to receive only relevant applications. The major advantage of encouraging online applications is that the recruitment process is faster. Another advantage is that it generates a diversity of applicants. Further, posting job openings online is cheaper than advertisements in the media. However, the flip side is that it will be a Herculean task to process the huge number of applications.

Chapter 5: Selection

Figure 5.2: Selection Process in Progress

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The different types of employment tests are performance simulation tests, work sampling, assessment centers, polygraphic tests, honesty and integrity tests and graphology. In performance simulation tests, actual work situations are simulated and applicants have to engage in behaviours necessary for doing job successfully.

Figure 5.3: Work Sampling Work sampling is a selection method requiring the job applicant to actually perform a small part of the job.

Employment Tests Literally hundreds of tests are available and described in books on applied industrial psychology. These tests are quite helpful in predicting the successful prospective employees. These tests can measure intellect, spatial ability, perception skills, mechanical comprehension, motor ability or personality traits. Performance Simulation Tests: To avoid the criticism and potential liability from using psychological, aptitude and other types of written tests, nowadays, firms use performance simulation tests. Here, actual work situations are simulated and the applicants are required to engage in behaviours necessary for doing the job successfully. It is assumed that these tests meet the requirement of the job-relatedness more easily because they consist of actual job behaviours. Work Sampling: It is a selection method requiring the job applicant to actually perform a small part of the job. In fact, it creates a mini replica of a job. Recruiters can assess whether the applicants possess the necessary skills/talents to do the actual tasks. Carefully selected work samples based on job analysis data determine the knowledge, skills and abilities needed for the job. Assessment Centers: Assessment center is a facility (not a place) where performance simulation tests are administered. Here, the tests are elaborate and specifically designed to evaluate a candidate's managerial position. These tests involve group as well as individual exercises. Applicants undergo a series of exercises which are appraised by line managers, supervisors, supervisors and/or trained psychologists. Similar to work sampling, these exercises are designed to simulate the actual work of managers. In certain cases, assessment center includes traditional cognitive ability tests and personality tests. ¾ Cognitive ability tests measure one's mental capabilities such as general intelligence, verbal fluency, numerical ability ad reasoning ability. ¾ Aptitude tests measure a person's capacity to learn or acquire skills

Assessment center is a facility (not a place) where performance simulation tests are administered.

¾ Achievement tests measure what a person knows or can do right now While cognitive ability tests measure a person's mental capacity, personality tests measure disposition and temperament. Personality traits are summarized by the 'Big Five' factors, namely, extroversion, agreeableness,

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conscientiousness, neurotism and openness to experience. Apart from the above common tests, there are companies which administer additional tests. Honesty and Integrity Tests: Pencil-and-paper honesty tests are used to find out potential items in integrity such as protecting wrong-doers, lenient with wrongdoers, entertaining counterproductive thoughts, intending to take part in counterproductive behavior, justifying questionable behaviour, etc. A comprehensive analysis and interpretation of honesty tests reveal the candidate's suitability for the job and other disruptive behaviours such as theft, disciplinary problems and absenteeism.

Figure 5.4: Polygraphic Test

The results of honesty tests must be used cautiously, preferably in conjunction with other sources of information. Graphology It refers to a variety of systems of handwriting analysis. From characteristics such as size and HRM - In lighter vein slant of letters, amount of pressure applied and placement of the writing on the page, graphologists are able to draw inferences about the writer’s personality traits, intelligence, energy level, organizational abilities, creativity, integrity, emotional maturity, self-image, people skills and entrepreneurial tendencies. Many employers use results of graphology to make employment decision. Though the predictive validity of graphology for job performance and occupational success remains questionable, many prefer it to personality tests which are costly and time consuming.

Polygraphic tests are to find out whether the candidates use drugs, are in the habit of stealing or have committed serious undetected crimes. Honesty tests are used to find out potential items in integrity such as protecting wrong-doers, entertaining counterproductive thoughts etc.

Graphology refers to a variety of systems of handwriting analysis.

Figure 5.5: Graphologist Analyzing Handwriting

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Tests must have reliability, validity and practicality. Reliability is the degree to which the tests yield comparable data over a period of time. Validity refers to what a test or procedure measures and how well it measures. Practicality refers to whether the tests are easy to administer.

Reliability and Validity of Tests Tests conducted for employment selection must be reliable and valid.

Reliability: Reliability is the degree to which the tests yield comparable data over a period of time. A test that gives widely different scores when administered to the same individual a few days apart is unreliable. Reliability also refers to the extent to which two or more methods of tests give similar results. If a test Figure 5.6: yields almost same Characteristics of scores when administEmployment ered by two or more Selection Tests raters, it shows the consistency of the test. Unless the results on which decisions are made are reliable, in terms of both stability and consistency, they cannot be used as predictors. Validity: Validity refers to what a test or procedure measures and how well it measures. It is the degree to which a test or procedure measures a person's attributes. ¾ In personal selection, validity is an indicator of the extent to which data from a test are predictive of job performance. ¾ Like a new medicine, a selection test must be validated before it is administered. ¾ There are two reasons for validating a test. First, validity is directly related to employee performance and second, certain regulations emphasize the importance of validity in selection procedure. ¾ In technical sense, validity refers to the inferences made from the use of the test, not to the test itself. ¾ There are different approaches to validation, namely, criterionrelated validity, content validity and construct validity.

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Criterion-related Validity: The degree to which a particular test accurately predicts the important elements of work behaviour. E.g.: Performance on a test vs. the actual production records and supervisory ratings. In a sales job, it is the test scores vs. the actual sales figures. Higher the test scores and higher the sales or production, then the test has criterion-related validity. There are three types of criterion-related validity: concurrent, predictive and cross-validation. Concurrent Validity: It is validating tests by using current (present) employees as the study group. That is, the employees take a test experimentally and the test scores are immediately compared with their actual performance on the job. If there is good correlation between the test scores of the employees and their actual performance, then the test has concurrent validity. Predictive Validity: It is validating tests by using prospective applicants as the study group. Test is administered on all prospective applicants. The test scores are filed. Some applicants may get selected after successfully completing the entire selection process. After sometime, may be after a year, the employees performance is compared with their original test scores. If there is significant positive relationship between the initial test scores and the performance measured after a time gap, the test is known to have predictive validity. Cross-validation: Verifying the results obtained from a validation test by administering a test to a different sample (drawn from the same people) Content Validity: It is the extent to which a test adequately samples the knowledge and skills needed to perform a job. Example: A typing test for a typist. Content validity is the most direct and least complicated type of validity to assess unlike the criterion-related method. Content validity is not expressed in correlation terms. Instead, an index is formulated from evaluations of an expert panel which indicates the relationship between the content of the test items and performance on the job.

Figure 5.7: Types of Validity

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Construct Validity: It is the degree to which a particular trait or a theoretical construct relates to successful job performance such as IQ and job performance. These traits are usually abstract in nature, such as IQ, and are called constructs. Measuring construct validity requires showing that the psychological trait is related to satisfactory job performance and the test accurately measures he psychological trait. Practicality: In addition to validity and reliability, another input factor is 'practicality'. The tests must be practical i.e. whether the tests are easy to administer. Many a time, a certain test may be highly valid and reliable but cannot be used for certain situations.

Comprehensive Interview Comprehensive interviews are designed to probe areas not revealed in the applications or tests, such as one’s motivation, values, beliefs, ability to cope with stress and suitability to ‘fit in’ with the organization.

After successful completion of the selection tests, the candidates are required to undergo a comprehensive interview. The applicant may be interviewed by HR experts, Senior managers, Supervisors, Peers or some or all of these. Comprehensive interviews are designed to probe areas not revealed in the applications or tests, such as one's motivation, values, beliefs, ability to cope with stress and suitability to 'fit in' with the organization.

Effectiveness of Interview A common question arises whenever interviews are discussed. Are interviews effective for gathering relevant information? Interview has become a common universal tool in the selection process. There are different types of interview: one to one interview, panel interview, situational interview, stress interview etc. ¾ Interview's validity as a selection tool has been subject to debate ¾ There is no cut and try interviews. Many factors enter into the interviewing process. ¾ Interviews have been found to be expensive, inefficient and often not job-related ¾ However, interviews have become a part of every job search

Types of Interview Interview methods differ in terms of the amount of control exercised by the interviewer. In highly structured interview, the interviewer determines the course of interview whereas in less structured interview, the applicant plays a major role.

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Figure 5.8: Types of Interview

¾ It is an interview in which the applicant is allowed the maximum amount of freedom in determining the course of interview, while the interviewer carefully refrains from influencing the applicant's arguments. ¾ The interviewer asks mostly broad and open-ended questions (tell about your skills, elaborate your work experience, what do you think about our company etc.) ¾ The applicant is allowed to talk freely with minimum interruption. ¾ Generally, the interviewer listens carefully and does not argue, interrupt or change the course abruptly.

Types of interview are unstructured, structured, situational, behavioural description, panel, computer and video interviews.

¾ The interviewer uses follow-up questions to extract more details and allows pauses in the conversation. ¾ Freedom given to the applicant is valuable in bringing out any information, attitudes, or feelings that may often be concealed in structured interview. However, as there is no set procedure, it is difficult to cross-check agreement with other interviewers. Thus the reliability and validity of nondirective interview is expected to be minimal. This method is mostly used in interviewing candidates for high-level positions and in counseling. Structured Interview:

Unstructured interview gives maximum amount of freedom to applicant in determining the course of interview, while the interviewer carefully refrains from influencing the applicant’s arguments.

¾ It is an interview where a set of standardized questions having an established set of answers is used. ¾ It is based exclusively on job duties and requirement, critical to job performance. ¾ Generally, it uses four categories of questions: situational questions, job knowledge questions, job sample/simulation questions and worker requirement questions.

Structured interview uses a set of standardized questions having an established set of answers.

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Situational interview gives a hypothetical incident to applicant and is asked how he or she would respond to it.

Figure 5.9: One-to-one Situational Interview

¾ There should be standard (benchmark) answers determined in advance. The correctness of answers is rated on a five-point scale. ¾ The applicant's answers are evaluated by a panel of interviewers. ¾ Same procedure is followed for all the applicants. ¾ The interview is documented for future reference and in case of legal challenge. Situational Interview: ¾ It is an interview in which an applicant is given a hypothetical incident and asked how he or she would respond to it. ¾ It is a variation of structured interview. ¾ The applicant’s response to hypothetical situation is evaluated against the predetermined standard answer. ¾ It is commonly used to select new college graduates. Behavioural Description Interview: ¾ It is an interview in which an applicant is asked questions about what he or she actually did in a given situation. ¾ In contrast to a situational interview, which focuses on hypothetical situations, behavioural description interview focuses on actual work incident in the interviewee’s past. ¾ The applicant is asked what exactly he or she did in the given situation. ¾ It is assumed that past performance is the best predictor of future performance.

Figure 5.10: Behavioural Description Interview

¾ There are chances of faking by the applicants. It is reported that this interview method is more effective than the situational interview for selecting people for higher-level positions. Panel Interview: It is an interview in which a board of interviewers questions and observes a single candidate. The applicant meets with three to five interviewers who take turns asking questions.

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After the interview the interviewers pool their observations and their rating scores to reach a consensus about the suitability of the candidate. This method is found to have higher reliability because of multiple inputs, greater acceptance of the decision and shorter decision time. If the panels are composed of a diverse group of interviewers, selection discrimination is minimized. Computer Interview: ¾ Nowadays, more and more organizations are using computers and the internet in the interviewing process.

Figure 5.11: Panel Interview

¾ Typically, a computer interview requires applicants to answer 75 to 125 multiple choice questions related to the job. ¾ The answers are compared with key answers. ¾ Computer interview can also be used as a screening device to filter unqualified applicants. ¾ There are agencies having expertise in computer interview with relevant softwares. ¾ In addition to the benefits of objectivity, applicants are less likely to engage in ‘impression management’. ¾ Computer interview is used mainly as a complement to, rather than as a replacement for, conventional interviews.

Figure 5.12: Candidates Taking Computer Interview

Video Interview: There are many big companies such as AT&T, Dell Computer, Shell Oil and Nike which use videoconference technologies to evaluate job candidates. While some companies have their own videoconferencing facilities, some hire outside agencies. ¾ Video interviews have several advantages such as flexibility, speed and cost. ¾ Company can make preliminary assessments about the candidate’s technical abilities, energy Figure 5.13: Video Interview

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In behavioural description interview, an applicant is asked questions about what he or she actually did in a given situation.

In panel interview a board of interviewers question and observe a single candidate.

level, appearance, communication skill etc. before incurring the costs of a face-to-face meeting. ¾ There are web-based companies which allow recruiters to videotape job applicants and post video interviews to a website. Corporations log on to the sites and check out candidates free of charge or for a small fee. ¾ By recording and playing back the interviews to several executives, firms can eliminate setting up of more interviews. ¾ The ultimate goal is to enable faster, higher-quality decisions at lower cost.

Research Findings on Interviews The following are some of the inferences on interviews. Commonly, computer interview requires applicants to answer 75 to 125 multiple choice questions related to the job.

¾ Interview is valuable in determining an applicant's organizational fit, level of motivation and interpersonal skills. ¾ Structured and well-organized interviews are more reliable. ¾ Interviewer's evaluation is biased by the prior knowledge about the applicant. ¾ Interviewers generally, hold a stereotype of what a 'good' applicant should be.

Video interviews use videoconference technologies to evaluate job candidates.

¾ Interviewers tend to favour applicants who share his or her own attitudes. ¾ The order in which applicants are interviewed and also the order in which information is obtained influence evaluations. ¾ Unduly weightage is given to negative information ¾ Decision on the candidate's suitability is, usually, taken in the first few minutes.

Interviewers are misled by impression management tactics of candidates. Impression management refers to one’s attempt to project an image that will result in a favourable rating.

¾ Interviewers are more likely to forget the contents of the interview within minutes after completion. ¾ Interviewers are misled by impression management tactics of candidates. This refers to one's attempt to project an image that will result in a favourable rating. If an applicant can say or do something the interviewer approves of, that person may be viewed more favourably for the position. ¾ Interrater reliability is increased when there is adequate information about the job.

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¾ Intelligence is the trait most validly estimated by an interview, but the interview information adds nothing to test data. ¾ Interviewers can easily explain why a candidate is rejected but they cannot easily answer why a candidate is more suitable. ¾ Factual written data seem to be more important than physical appearance in decision making. ¾ Nonverbal as well as verbal communication influence rating. ¾ Experienced interviewers tend to be more selective than less experienced ones.

How to Make Interviews more Effective? Apart from the characteristics of the interviews themselves, interviewers play a major role in making the interviews effective. Organizations must select the employment interviewers judiciously. The interviewers must be humble and able to think objectively. They should have the maturity and poise. Due to diversity in the workforce, experience in associating with people from diverse backgrounds is also desirable. Qualities to be avoided in the interviewers are overtalkativeness, extreme opinions and biases. Effective interviewer must: ¾ establish an interview plan based on the purposes of interview, determine the areas and specific questions to be covered and review job requirements, application-form data, test scores and other available information before the interview. ¾ establish/maintain rapport with the applicants by greeting the applicants pleasantly, explaining the purpose of the interview, showing sincere interest in the applicant and listening carefully. ¾ be an active listener striving to understand, comprehend and gain insight into what is only suggested/implied with alert mind and appropriate body language. ¾ pay attention to nonverbal cues of the applicant such as facial expressions, gestures, body position and movements as they provide clues to the candidate's attitudes and feelings. ¾ provide information as freely and honest as possible by answering fully and frankly the applicant's questions and present a realistic picture of the job. ¾ use questions effectively to elicit truthful answers by phrasing the questions objectively without indicating what response is desired.

Interviewers must be humble, able to think objectively, establish rapport with applicants, have interview plan, look for facts, have maturity and poise, and avoid over talkativeness, extreme opinions and biases.

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¾ separate facts from inferences by recording factual information and inferences separately for comparison with those of others later. ¾ recognize biases and stereotypes, particularly, the interests, experiences and background common to both the interviewer and the interviewee. ¾ control the course of interview by establishing an interview plan and sticking to it and providing the applicant with ample chance to talk but at the same time maintaining control of the situation to reach the objectives of the interview. ¾ standardize the questions asked to increase reliability by putting the same questions to all applicants for a particular job. Background investigation is the process of verifying information provided by the candidates seeking job.

Background Examination Background investigation is the process of verifying information provided by the candidates seeking job. ¾ Background investigations or reference checks are intended to verify that the information given in the application form is correct and accurate. ¾ It is accomplished by contacting former employers, verifying the educational qualifications, checking credit references/criminal records, etc. ¾ Even third-party investigators are hired to do the background check. ¾ Background investigation is done as applicants tend to exaggerate their backgrounds and experiences. Further, a good predictor of an individual's future behavior is his or her past behavior. ¾ It is just common sense that the organization should find out as much as possible about its applicants before final hiring decision is made as failure to do so will have detrimental effect, both in cost and morale.

Conditional job offer is a tentative job offer given by HRM department that becomes permanent after certain conditions are met.

Conditional Job Offers Once the selection process is successfully completed, the job applicants are given conditional job offer. It is a tentative job offer that becomes permanent after certain conditions are met. Conditional job offers typically come from HRM department. This offer implies that if everything, such as passing a certain medical test, physical or drug abuse test etc., checks out

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the conditional nature of the job will be removed and the offer will be permanent.

Medical/Physical Examination The last-but-one-step in the selection process is medical / physical examination. ¾ Physical examination is done to screen out applicants who are unable to physically comply with the requirements of a job (fire service, security service, police department etc.). ¾ Medical examination is needed to show that minimum standards of health exist to enroll in company health and life insurance programmes. ¾ The company can use the data of medical / physical examination to provide base data in case of an employee's future claim of injury on the job.

Physical examination is done to screen out applicants who are unable to physically comply with the requirements of a job. Medical examination is needed to show that minimum standards of health exist to enroll in company health and life insurance programmes.

¾ Of late, many companies require applicants to undergo a drug test. Failing an employment drug test will result in rejecting an applicant.

Permanent Job Offer If selection is for particular positions, candidates who perform successfully in all the steps of the selection process are considered eligible to receive employment offer.

Decision Strategy Though the selection process is almost common, the decision strategy differs from category to category. The strategy in selecting personnel for managerial and executive positions does differ from that of clerical and technical cadre. Many factors are to be considered in making the final decisions when many candidates are being selected for various positions. The following points are to be taken into consideration for effective selection and placement: ¾ Are the applicants hired according to their potential or according to the needs of the organization? ¾ What should be the initial grade and compensation? ¾ Which is to be given more importance, employee-job requirement or employee-potential for advancement?

Candidates who perform successfully in all the steps of the selection process are considered eligible to receive permanent job offer.

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¾ Should the candidates who are not qualified presently but qualifiable later be considered? ¾ Should overqualified candidates be considered? ¾ Should the organization go in for almost uniform type of employees or encourage diversity among the employees? The two approaches to hiring decisions are clinical and statistical. In clinical approach the decision maker takes into account all the data gathered about the applicants. Statistical approach involves identifying the most valid predictors and weighing them through statistical methods.

Approaches in Hiring Decisions In addition to answering the above points the hiring decision makers must decide which approach they choose, clinical or statistical approach?

Clinical Approach In this approach the decision maker takes into account all the data gathered about the applicants. After comparing the job requirements and the candidates' suitability decisions are made. When there is a panel of selection members each will have his or her own evaluation making the final selection difficult. Further, personal biases and stereotype problems are covered up as rational decision making by the influential selection members.

Statistical Approach ¾ Compared to clinical approach, statistical approach in making hiring decision appears to be more effective. ¾ This approach involves identifying the most valid predictors and weighing them through statistical methods such as multiple regression. ¾ Quantified data such as test scores and interview scores are combined after giving appropriate weighted values. ¾ Candidates with the highest combined scores are selected. There are three models in statistical approach: Compensatory Model: It is a statistical selection model in which a high score in one area can compensate a low score in another area. Multiple Cutoff Model: It is a selection decision model that requires a candidate to achieve some minimum level of proficiency on all selection dimensions. Multiple Hurdle Method: It is a sequential strategy in hiring decision where only the candidates with the maximum scores at the initial test stage go on to subsequent stages. The process continues through several stages or hurdles before a final decision is made. This approach is useful when the testing procedure is lengthy or expensive.

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Each of the statistical models requires that a decision be made based on the cutoff score. Cutoff score is the point above which a person is considered for appointment and below which the person is rejected.

Best Practices in Recruitment and Hiring in Top Companies Best practices employed for recruitment in top companies are given below. ¾ Establishing a policy for recruitment and hiring, including criteria, procedures, responsible individuals, and applicability of diversity and affirmative action. ¾ Engaging in short-term and long-term strategic planning. ¾ Identifying the applicable barriers to equal employment opportunity. ¾ Ensuring a communication network notifying interested persons or opportunities, including advertising within the organization and, where applicable, not only with the general media, but with media aimed at minority people, disabled people, older people, and women. ¾ Communicating the competencies, skills, and abilities required for available positions. ¾ Expressing family-friendly and work-friendly programs. ¾ Considering arrangements with the local transit authority where transport is an issue. ¾ Participating in career and job fairs and open houses. ¾ Working with professional associations, civic associations, and educational institutions to recruit. ¾ Using recruiter, referral, and search firms with instructions to present diverse candidate pools to expand search networks. ¾ Partnering with organizations that have missions to serve targeted groups. ¾ Using internship, scholarship programs and the like to attract interested persons and to develop interested and qualified candidates. ¾ Developing and supporting educational programs and becoming more involved with educational institutions that can refer a more diverse talent pool. ¾ Ensuring that personnel involved in recruitment and hiring are well trained in their equal employment opportunity responsibilities.

The three models in statistical approach are compensatory model in which a high score in one area can compensate a low score in another area, multiple cutoff models that require a candidate to achieve some minimum level of proficiency on all selection dimensions and multiple hurdle method where only the candidates with the maximum scores at the initial test stage go on to subsequent stages. The process continues through several stages or hurdles before a final decision is made.

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¾ Exploring community involvement options so the company's higher profile may attract more interested persons. ¾ Eliminating practices that exclude or present barriers to minorities, women, people with disabilities, older people, or any individual. HRM - In lighter vein

¾ Including progress in equal employment opportunity recruitment and hiring as factors in management evaluation.

Review Questions Review Questions Answer in brief 1. What is selection?

9. Differentiate structured and unstructured interview.

2. Differentiate polygraphic test and honesty test.

10. What is situational interview?

3. What is graphology? 4. Differentiate reliability and validity of tests.

12. Differentiate conditional job offer and permanent job offer.

5. What is criterion related validity?

13. What is clinical approach?

6. What is concurrent validity?

14. What is statistical approach?

7. What is content validity?

15. What is compensatory model in selection?

8. What is construct validity?

16. What is multiple cutoff model?

11. What is panel interview?

17. What is multiple hurdle method?

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Answer in detail 1. Discuss the selection process step by step.

4. Discuss the various types of interview.

2. Elaborate the various employment tests.

5. How to make interviews more effective?

3. Describe the various types of validity.

6. Describe the various approaches in hiring decisions.

Specialists Speak

Specialists Speak Specialists Speak - 1

Dr. Harshit Sinha, Dean, JB Knowledge Park, Faridabad

Nail that Job Interview Here is how you can face an interview in the best possible way. For any given vacancy, at least hundreds, if not thousands, of candidates apply. It takes only a few seconds for a recruiter to reject your candidature if your resume fails to make that first impression. Thus, it is very important to succinctly outline your career objectives, work experience, projects, trainings, personal strengths and so on. Some common job interview questions: Tell me about yourself - Make a short, organised statement of your education, professional achievements and career goals. Briefly describe your qualifications for the job and contributions you could make to the organisation; Why do you want to work here? - Show the interviewer your interest in the company. Share what you learned about the job, company and industry through your own research. Talk about how your professional skills will benefit the company.; Why did you leave your last job? - The interviewer may want to know if you had any problems in your last job. If you did not have any problems, state politely what opportunity you are looking for. If you did have problems, be honest. Show that you can accept responsibility and learn from your mistakes; What are your best skills/strengths? - If you have sufficiently researched the organisation, you should be able to imagine what skills the company values. List them and give examples where you have demonstrated them; Do you prefer to work by yourself or with others? - The ideal answer is one of flexibility. However, be honest. Give examples describing how you have worked in both situations;

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What are your career goals? - The interviewer wants to know if your plans and the company's goals are compatible. Let him know that you are ambitious enough and be as specific as possible about how you will meet the goals you have set for yourself; What kind of a salary are you expecting? - The answer depends upon the profile of the candidate and situation. If you are experienced and currently working, you may negotiate a hike. If you are a fresher, 'as per the company policy and meeting my current financial requirements' are suitable answers; What do you think about (a controversial topic)? - Such questions are asked not because your opinions are very important, but to check how you can handle a controversial issue with a balanced and logical approach. Go ahead and give your opinion, but without hurting the sentiments of a group or culture. (Source: http://itsmyascent.com/cms?targeturl=web%2Fitsmyascent%2Fcareer-advice%2F%2Fasset_publisher%2FnL0N%2Fcontent%2Fnail-that-job-interview) Specialists Speak - 2

Dr. Jaideep Kaur, Faculty, HR department, Amity Business School

Hiring Competent People Leads to Organizational Effectiveness Human resource management is responsible for the people dimension of an organization. It is responsible for getting competent people, training them, getting them to perform at high levels, and providing mechanisms to ensure that its employees maintain their productive affiliation with an organization. Human resource management involves the productive use of people in achieving organizational strategic objectives and the satisfaction of individual employee needs. Human resource managements execute diverse functions as recruitment and selection, training and development, performance management, compensation management, Managing diversity, industrial relation, labor laws, International human resource management, HRIS, career planning, employee health and safety, HR audit and managing human resources in changing world. Every one of these functions has their own importance in the organization. Nevertheless getting competent people is the most important HR responsibility in my point of view. There is perhaps no more vital topic in HRM than employee selection, as right selection pushes the organization towards the right direction and trains them for competitive advantage over other competitors. An organization fails to achieve its strategic business objectives without competent people and right training. The success of an organization depends on having the right people in the right job at the right time, the organization strategic business objectives and culture should determine the people selected. In others words, the selection criteria should be consistent with the organization's strategic business objectives. Companies today are facing revolutionary changes, complex technologies and global competition. Organizations that fail to have right person at right place at the right time are at risk. A proper match between work and the employee capabilities are now an economic necessity. The pressures of competition, cost saving, downsizing and global skill shortages have made

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recruitment a top priority. The competition for talent means that skilled workers are today's prized trophies. For many companies, talented people are the prime source of competitive advantage. Charles Goode, chairman of ANZ, says 'Attracting and retaining the most talented staff and building a successful culture are critical to our future. It is true that organizations succeed or fail on the basis of talents of employees, then mangers directly influence that success by the people they hire. Regardless of whether the company is large or small, hiring the best and the brightest employees lay a strong foundation for excellence. Alternatively, it is common to hear managers who don't recognize this point lament the inordinate amount of time they spend trying to fix bad selection decisions. In addition, equal employment opportunity legislation, court decisions, and the Uniform Guidelines have also provided and impetus for making sure that the selection process is done well. The bottom line is good selection decisions make difference. So do bad ones. The first step towards getting competent people starts with Strategic recruitment (the linking of recruitment activities with organization strategic business objectives and culture) and followed by strategic selection (the linking of selection activities with organization strategic business objectives and culture) to accomplish organization business objectives. Strategic selection aligns employment activities with the organization strategic business to produce contribution to organizational performance. Jaguar UK for example uses psychometric tests to measure independence of thoughts, team working and cooperativeness. Mazda (USA) uses aptitude test, written form, personal interviews, and stimulated work exercise to weed out druggies, rowdies and unionists. The success of strategic selection processes depends on the process of analyzing job and develops job descriptions and specifications. job specifications, in particular, help identify the individual competencies employees need for success - the knowledge, skills, abilities, and other factors (KSAOs) that lead to superior performance. This is often referred to as person-job fit. The process of graduate recruitment and selection in the UK has become more person-related than job-oriented because many employers are more interested in the attitudes, personality and transferable skills of applicants than the type or level of qualification acquired. Research has demonstrated that complete and unambiguous specification of required competencies (via job analysis) reduce the influence of racial and gender stereotypes and helps the interviewer differentiate between qualified and unqualified applicants Research also shows that applicants whose KSAOs are well matched to the jobs they are hired for perform better and are more satisfied. The threshold competencies are the essential characteristics that everyone required in a job but the differentiating competencies are the characteristics that distinguish superior performers from average performers as superior performer utilize their skills and knowledge at their maximum level. Emotional, social and cognitive intelligence competencies predict effectiveness in professional, management and leadership roles in many sectors of society. In addition, these competencies can be developed in adults. The use of selection methods such as interviews, references, psychological tests (interest test, aptitude test, and personality test) helps in identifying the required competencies for the job and in accomplishing the organizations strategic selection.

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The execution of HR practices in relation to HRM activities helps the organization to function smoothly. The implementation of the systematic process of strategic recruitment, strategic selection, accurate job analysis, matching of competencies, using competency based selection procedures indeed helps the organization to get competent people which in return helps in accomplishing its strategic business objectives (mission). In the rapid changing economy, organization restructuring, international competition, global outsourcing, deregulation, social attitude, legal requirement and industrial relations, training becomes the need of the hour as to take competitive advantage over other competitors and develop them for the better future. Therefore getting competent people and training are backbone of HR as strong foundation (competent people) and (training) builds up a strong organization and prepare to sustain the organization in changing economy. (Source: http://www.contentwriter.in/articles/hr/hiring-competent-people.htm)

Case Study

Case Study Case 1

It was an important day for Abhay Mittal, a management graduate seeking an employment opportunity in the competitive business environment. He received an interview call from one of the nation's leading private sector banks for the post of Relationship Manager (RM). The responsibility of an RM includes providing important customers with complete and integrated investment advice. The RM must also seek to attract prospective customers who had the potential to make heavy investments with the bank. Mittal was excited as he had been waiting for a call from this bank for quite some time. He then prepared for his interview by reading the company's performance and history, making a quick SWOT analysis of the bank, and getting his documents ready for the interview. He also organized a mock interview with his friend who was an HR Manager in a consultancy firm. Having brushed up the fundamentals in his areas of interest and study, Mittal was all set for the interview the following day. However, the interview proved to be a nightmare. It started an hour behind schedule and Mittal was kept waiting with no intimation of the changed schedule. The reception could not provide him any relevant information. Mittal, however, kept his cool and waited patiently for his turn. Finally, after an hour, he was called in. He firmly knocked on the door before entering the interview hall. The hall was huge with the panel of members seated in a corner. The panel consisted of seven members, none of whom, according to Mittal seemed friendly and approachable. He was made to sit on a chair that seemed likely to break with the slightest jerk. He however, managed to sit, leaning forward slightly and tried to listen to the panel.

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A long silence followed. Mittal then hesitatingly ventured to initiate the conversation. “Here are the certificates in proof of my academic qualifications,” he said. This was followed by a quick response from the person sitting to his left. “It is not a bundle of certificates we are interested in, young man. They are no proof of how capable you are to handle the stress you would experience in case of your selection.” Mittal was taken aback for a moment-However, he gave a gentle smile and said that he was ready for the interview. Mittal encountered a barrage of questions, most of which seemed irrelevant to the job of an RM. Although he could answer most of the questions, he was never allowed to answer them completely. He was constantly interrupted by the panel members while trying to answer the questions posed by each one of them. Most of the questions were sarcastic and cynical in nature. Mittal was given ambiguous instructions and asked to solve a situational case. He was then put through imaginative situations that required him to make tough decisions. Mittal could feel the tension creeping into him. Although he handled the questions well, he felt he could have done better if the panel had been more approachable. There was complete silence for some time. The panel members inquired if Mittal had any questions to ask. By then, Mittal was exhausted and longed to leave the room. He kept his calm and said that there was nothing that he would like to ask, even though he had prepared a short list of questions the previous evening. The members assured him that they would get back to him soon. Mittal thanked the panel and left the room in disgust. Questions: 1.

What kind of interview do you think Abhay Mittal had to face? Describe the basic features of such an interview.

2.

Discuss the various other kinds of interviews that could be used by organizations to make their Selection process effective. Also discuss the advantages and disadvantages of each of these methods of selection.

(Lingayas University, February 2011)

Case 2 Majestic Electricals Limited Majestic Electricals Limited was engaged in manufacturing and selling electrical goods of high quality. It believed in introduction of new and sophisticated products in the market. Mr.K.S.Lal, previously the corporate development manager, was promoted to the rank of general manager the company. In his new position, he needed a bright manager to serve as his deputy to assist in carrying out his day-to-day activities and coordinating marketing, manufacturing, research and development and finance functions. There were three candidates available who could be considered to the position of Mr. Lal’s deputy. All of them had very good academic background and successful careers of varying lengths with the company. The first candidate, Mr. Rohit was with the company for the last three

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years. He had engineering and M.B.A. degrees from reputed universities. He believed in high achievement. He used to perform assigned tasks very quickly and accurately. He performed well when he had complete control over the situaion. Many critical tasks he preferred to do himself and accomplished in much shorter time.The second candidate for the position was Mr. Rahul. He had Ph.D. degree in quantitative analysis with engineering background. He joined the company about a year back. His performance in the previous job was rated to be high responsibilities at each promotion. He developed good understanding of the company’s working though he was somewhat reserved in staff meetings. The third candidate Mr. Prakash, did not have any engineering or management degree, but attained good marks in his arts degree. He had been with the company for the last fifteen years. He was quite good in his work and had good knowledge of the company’s operations. He enjoyed working with most key managers and did not have confrontation or disagreement with any manager of the company. However, he was not agressive and had difficult time in examining critically new ideas and proposals. Questions: 1. Assuming that you have to select one of the above candidates, whom will you prefer? 2. If you have to conduct interview for the selection of the candidates, what type of questions will you ask? 3. Explain the criteria employed for selection of candidates. (Annamalai University, May 2011)

Classroom Project

Classroom Project

Mock selection procedures are given in classroom for practice. The process is to start with various types of tests and interviews. Students are to take turns as interviewer and interviewee to conduct mock interviews. Every kind of interview is practiced as role plays by adopting individual interviewer or panel of interviewers. Videographing the interviews and giving feedback are used to improve the employability skills of the students.

Field Project

Field Project

The students, in groups of 4-5, are to visit different firms. They are instructed to collect information on the selection processes followed in the firms. (Group discussion, Aptitude tests, Role plays, Inbasket Exercises, Personal Interview, etc). They can also interview the employees at different levels who had experienced the selection process to find out whether they were satisfied with the selection process and if not, what are their suggestions to make the selection process effective. The information are discussed in the classroom to find out the best selection process.

Socialization and Orientation

Key Terms Socialization Pre-arrival

Encounter

Metamorphosis Orientation

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HRM - Indian Perspective

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Socialization

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Employee Orientation

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Review Questions

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Specialists Speak

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Case Study

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Classroom Project

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Field Project

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HRM – Indian Perspective

Wipro Office in Bangalore

Wipro Technologies Limited

Shri. Azim Premji, Chairman

Wipro Technologies Ltd is a global information technology, consulting and outsourcing company. Wipro is globally recognized for its innovative approach towards delivering business value and its commitment to sustainability. Wipro champions optimized utilization of natural resources, capital and talent. Today they are a trusted partner of choice for global businesses looking to ‘differentiate at the front’ and ‘standardize at the core’ through technology interventions. Wipro is well positioned to be a partner and co-innovator to businesses in their transformation journey, identify new growth opportunities and facilitate their foray into new sectors and markets. Wipro, one of the world’s most trusted brands, is a name with a long history. It was established in 1945 as Western India Vegetable Products Limited in Amalner, Maharashtra and ventured in to the fledgling IT industry in 1981. In this fast changing world, Wipro believes it can leverage on its institutionalized innovation culture to push the boundaries for delivering solutions that provide enhanced value and direct impact for their customers. This culture has brought to the fore innovations like India’s most powerful supercomputer, a cost-effective Base Terminal Station designed for GSM networks in underserved markets, a mobile switching router for emerging markets, connected home concept and Wipro Energy Manager that uses M2M communication, among others. Wipro has also developed application-based innovations like Flex and Cigma delivery models which are service-based as opposed to resource-based. Wipro is also partnering with European research institute IMEC to coinnovate and develop next-generation intelligent systems based on nanoelectronics and aimed at emerging markets through an initiative called Applied Research in Intelligent Systems Engineering (ARISE). Wipro has received the ‘NASSCOM Corporate Award for Excellence in Diversity and Inclusion, 2012’, in the category ‘Most Effective Implementation of Practices & Technology for Persons with Disabilities’. The CEO spends 3 to 4 hours with every new group of employees, briefing them about their promises, values and beliefs. Every four months they conduct an employee survey where all employees provide inputs on the health of the workplace. This survey enables to identify how strongly the person feels about the organization, and how strong is the person’s clarity

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of his / her existence in the organization. It also enables us to see the person’s own ability to identify with the vision of the organization, and whether he / she thinks the organization listens to what he has to say. He / she also reveals whether he / she feels that his supervisor takes interest in his/her development, has he / she received any word of praise from the boss for a good job done and so on. This proves to be an eye opener for the managers as well. They have the HR review in the planning cycle, which is a rigorous process involving everyone, right up to the head of the organization. They do succession planning for individuals wherein they identify the best talents - the top ten people. They also identify bottom ten people, who are asked to pull up their socks and improve, failing which they will have to leave. They carry out this exercise every quarter and this enables them to be well informed about their people asset. They have a program, which is known as “wings within’- an internal job posting system. This works well, as their people can apply for jobs in other departments and they do not have to inform their supervisors about it. If selected they can move out and nobody can stop them. This gives people the feeling that they are not buttonholed into a particular type of job. It stems from the belief that corporations are socio-economic citizens and that their objectives have to be congruent with society’s goals. Today, they wield significant capacity to influence social issues, i.e. “power to do good”. This is a responsibility and must manifest in thoughtful and deliberate set of initiatives, not in charity. These must reflect the same level of rigor & strategic thinking as in business initiatives. Wipro believes it must try to, and can make lasting impact, towards creating a just, equitable, humane & sustainable society. It has programmes to provide leadership in thought & action on key societal issues; respond to immediate issues of current generation and work towards building a good society for future generations. Both socialization and orientation are a process of helping new employees to adapt to their new organization/environment. These programmes are designed to help the employees fully understand the working environment and make them productive as soon as possible. When employees understand and accept behaviours which the organization views as desirable, each employee will attain his/her goals without any problems.

Socialization Socialization is a process of adaptation that takes place as individuals attempt to learn the values and norms of work roles. ¾ In the context of organization, socialization refers to all passages employees undergo. ¾ Employees are required to make adjustments when they begin a new job, accept a transfer or are promoted.

Figure 6.1: Socialization in Progress

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Socialization is a process of adaptation that takes place as individuals attempt to learn the values and norms of work roles. Loneliness and a feeling of isolation are usual for new employees and they need special attention to put them at ease.

¾ They have to adapt to a new environment such as different work activities, a new boss, a different and most likely diverse group of co-workers and a different set of standards for successful performance. ¾ Although socialization continues throughout people’s careers within the organization as well as between organization the most profound adjustment takes place when one joins an organization first time. It is a move from being an outsider to being an insider. An employee on the first day in a new organization will have different feelings. Anxiety over new expectations, uncertainty over what is to come, excitement at being on one’s own and experiencing new things, fear about what other colleagues feel and stress over work schedule and behaviour of the boss are some of the feelings. Organizations can help the employees in the adjustment process if a few assumptions are understood clearly. Loneliness and a feeling of isolation are not unusual for new employees, they need special attention to put them at ease.

Assumptions of socialization are that it strongly influences employee performance and enhances organizational stability; new members suffer from anxiety; it does not occur in vacuum; and individuals adjust to new situations in similar ways.

Assumptions of Socialization ¾

Socialization Strongly Influences Employee Performance: One’s work performance depends to a large extent on knowing what he or she should or should not do. Understanding the right way to do a job shows that there has been proper socialization. Fitting well into the organization, getting along well with co-workers, having acceptable work habits, demonstrating the right attitude and presenting appropriate behaviour are some of the qualities which help in better appraisal of performance. Socialization plays an important role in influencing one’s actual job performance and how others perceive it.

¾

Socialization Enhances Organizational Stability: Organization will be more stable when jobs are filled and vacated with minimum disruption. In stable organization objectives get transferred between generations smoothly. Loyalty and commitment will be maintained easily as the organization’s philosophy and objective appear consistent over time in stable organization. All these are seen where there is proper socialization.

¾ New Members Suffer from Anxiety: The outsider-insider passage, generally, creates anxiety. Though not with the work itself, a

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newcomer feels a lack of identification certainly with a new manager, new coworkers, a new work location and new rules and regulations. Loneliness and a feeling of isolation are not unusual. Anxious employees need special attention requiring adequate information to calm them. The new member is usually anxious about the new role but can be motivated to learn and accepted as HRM – In lighter vein a member of the group easily through socialization. ¾ Socialization does not occur in vacuum: Learning associated with socialization goes beyond the formal job description and expectations of people or managers. Socialization is influenced by subtle statements and behaviours of colleagues, management, employees, clients and others with whom new members interact. ¾ Individuals adjust to new situations in similar ways: Even though the types of adjustments vary, anxiety is high at entry level and every newcomer, irrespective of the environment wants to reduce that anxiety quickly. Information obtained during recruitment and selection is always incomplete and many time distorted. Even new member goes through a settling-in period that tends to follow a relatively similar pattern. Noe et al (2008) mentioned two types of socialization. Organization Socialization: It is a process by which new employees are transformed into effective members of the company. Effective socialization involves being prepared to perform the job effectively, learning about the organization and establishing work relationships. Anticipatory Socialization: This occurs before the individual joins the organization. Through anticipatory socialization, expectations about the organization, job, working conditions and interpersonal relationships are developed through interactions with representatives of the organization, namely, recruiters, prospective peers and managers, during recruitment and selection. The expectations are also based on prior work experiences in similar jobs elsewhere.

The two types of socialization are organization socialization and anticipatory socialization. Organization socialization is a process by which new employees are transformed into effective members of the company. Anticipatory socialization occurs through interactions with representatives of the organization on expectations about the organization, job and working conditions.

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Realistic Job Preview Potential employees need realistic job information. A realistic job review provides accurate and adequate information about the attractive as well as the unattractive aspects of the job, working conditions, organization and location to make sure that employees develop appropriate expectations.

HRM – In lighter vein

Realistic job preview provides accurate and adequate information about the attractive as well as the unattractive aspects of the job, working conditions, organization and location to make sure that employees develop appropriate expectations.

This information is usually given in brochures, in videos, or by the recruiters during interview. Though the influence of realistic job previews on employee turnover is not clear, unmet expectations result in dissatisfaction and turnover. However, employees’ expectations about a job and an organization may be formed by interactions with managers, peers and recruiters rather than from specific messages about the job.

Process of Socialization Socialization process involves three stages viz. Pre-arrival, encounter and metamorphosis.

Figure 6.2: Socialization Process Pre-arrival Stage: This stage recognizes that employees arrive in an organization with a set of values, attitudes and expectations. That is, it aims at understanding what the new employee has gained before joining the organization. Pre-arrival socialization goes beyond the specific job. Most organizations use the selection process to inform prospective employees about the organization as a whole. Selection interviews also make sure that only the ‘right type’ of employee is selected. Encounter Stage: In this stage, the new employee gains clear understanding of the organization and deals with the realization that expectations and reality may differ. If the expectations about job, co-workers, supervisors and the organization in general prove to have been more or less accurate, there will not be any problem. Whatever may be the information provided

Chapter 6: Socialization and Orientation

during interview and site visits, individuals beginning new jobs will experience shock and surprise. Where expectations and reality differ, new employees must be socialized to make them leave their previous assumptions and replace those with the organization’s core work culture. Challenging work and cooperation from managers and co-workers will enhance employees’ learning the job. New employees view managers as an important source of information about the job and company. Reports suggest that the nature of the new employee’s relationship with the manager has a significant impact on socialization. It has been found that negative effects of unmet expectations can be reduced if there is a good relationship between the employee and manager. Managers can help create high-quality work relationships by helping new employees understand their roles, providing information about the company and making them understand the stressors and issues that new employees experience. Employees need to become familiar with job tasks, receive appropriate training and understand company practices and procedures. However, socialization cannot solve all differences of expectations. There are cases where some of the new members may become totally upset with the reality of their jobs and resign. Proper selection and realistic briefing of the jobs and company may reduce the problem of new employees leaving the company to some extent. Metamorphosis and Settling-in Stage: Metamorphosis is the stage where the newcomer understands the problems and changes himself/herself to the new environment. Metamorphosis is complete only when the newcomers become comfortable with the organization, their work and the work teams. They understand and accept the norms of the organization. After complete metamorphosis new members will feel accepted by their peers as trusted and valued individuals. They will feel competent to complete their jobs successfully. They will understand the organizational system including their own tasks, rules and procedures. Finally, the newcomers will come to know how they will be evaluated i.e. what criteria will be used to measure and appraise their work. They will understand what is expected of them and what makes a good employee. Employees need to complete all the three socialization stages to fully contribute to the organization. Successful metamorphosis will have remarkable positive impact on employees’ productivity and their commitment to the organization. This will reduce the chances of the employee leaving the organization any time soon. Employees who experience successful socialization are more motivated and more committed to the organization and more satisfied with their jobs.

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Socialization process involves three stages viz. pre-arrival, encounter and metamorphosis. Prearrival stage recognizes that employees arrive in an organization with a set of values, attitudes and expectations. In encounter stage, the new employee gains clear understanding of the organization and deals with the realization that expectations and reality may differ. In metamorphosis and settling-in stage, the newcomer understands the problems and changes himself/herself to the new environment. Employees need to complete all the three socialization stages to fully contribute to the organization.

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Employee Orientation

Figure 6.3: New Employees in the Orientation Programme

Orientation is the process of introducing new employees to the organization and their work units. It supplements the information received during recruitment and selection stages. Orientation covers the following:

Figure 6.4: Components of Orientation

Company Goals: Goals of the organization with rules, values or principles directing the organization.

History: The organization’s traditions, customs, myths, background of founders and the present members in the top management.

Language: Jargons, slangs, and technical terms unique to the organization. Politics: Ways and means to gain formal and informal information about jobs and relationships/power structures in the organization. People: Nuances in initiating and maintaining relationships with peers. Performance Proficiency: Effectiveness in acquiring and using knowledge, skills and abilities needed for the job. In addition to the above, orientation includes communication of HRM policies such as work hours, pay procedures, overtime requirements / company benefits, and duties and responsibilities of new members; In large organization the

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members are shown the various physical facilities available. Important aspect is introduction of the new employee to his supervisor and co-workers. Orientation is taken care of by the employee’s supervisor/manager or the HRM personnel. Sometimes computer-based programmes are used.

Characteristics of Effective Orientation ¾ Encouraging employees to ask questions. ¾ Including information on both technical and social aspects of the job. ¾ Making the new employee’s manager responsible for the orientation. ¾ Avoiding embarrassment to the new members. ¾ Arranging formal and informal interaction with managers and peers. ¾ Providing relocation assistance such as house hunting, information about the local society, and etc. ¾ Giving information about the company’s products, services and customers. ¾ Familiarizing adequately with the culture of the organization such as how work is done, what matters in the organization, which workrelated behaviours are acceptable or unacceptable and etc.

CEO’s Role in Orientation In the earlier days, CEOs never bothered to take part in the orientation programmes. Consequent to the advice given by the management consultants many top managers started making themselves visible in their organizations, meeting and greeting employees and listening to employee concerns. ¾ Having the CEO present from day one, and addressing new employees, helps allay the fears about the new job/organization. ¾ The CEO’s first responsibility is to welcome new employees and talk to them about the good job choice they made. It is similar to cheerleading pep rally. ¾ The CEO is in a position to inspire new employees by talking about what it is like to work for the organization. ¾ The CEO can discuss what really matters in the company i.e. an indoctrination to the organization’s culture. ¾ When a CEO is present in the orientation programme, the organization shows that it truly cares for its employees.

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Orientation is the process of introducing new employees to the organization and their work units. It includes history of the organization, company goals, language of the organization, politics, people and performance proficiency needed for the job. Characteristics of effective orientation are encouraging employees to ask questions, including information on both technical and social aspects of the job, making the new employee’s manager responsible for the orientation, avoiding embarrassment to new members, arranging formal and informal interaction with managers and peers, providing relocation assistance, giving information about the company’s products, services and customers, and familiarizing with the culture of the organization. CEO has a major role in orientation. He/she should be present from day one and address new employees, welcome them and talk to them about the good job choice they made, inspire them talking about what it is like to work for the organization, discuss what really matters in the company and show that the organization truly cares for its employees.

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Orientation function can be performed by HRM, line management or a combination of the two. HRM plays a major role in new-employee orientation as it issues offer letters. It ensures that appropriate components are in place, serves as a participant in the program, instructs the new employee when to report, answers the long list of questions about the benefits the company offers, prepares a package focusing on important decisions the new employee is expected to take, addresses what assistance it can offer to the new employee in future, and lets the new employees know what HRM can do suppose many HRM services are outsourced.

HRM’s Role in Orientation ¾ Orientation function can be performed by HRM, line management or a combination of the two. ¾ In spite of preference for a combination strategy, HRM plays a major role in new-employee orientation. ¾ HRM ensures that appropriate components are in place. ¾ Moreover, HRM also serves as a participant in the program. ¾ As it is appropriate that offer letters should come from HRM, orientation must be coordinated by HRM. ¾ When job offers are accepted, HRM should instruct the new employee when to report. ¾ Before the new employee formally reports himself/herself for duty, HRM must be prepared to handle some of the routine needs, particularly well-prepared answers to the long list of questions about the benefits the company offers. ¾ Some organizations are proactive and prepare a package focusing on important decisions the new employee is expected to take such as choice of health insurance, banks for direct deposit of pay packs, tax deduction information etc. ¾ HRM must spend some time addressing what assistance it can offer to the new employee in future. ¾ In addition to providing an array of services such as career guidance, employee training etc, the HRM should let the new employees know what else HRM can do suppose many HRM services are outsourced.

An Overview of Employee Orientation ¾ Though many organizations provide orientation to new employees, the effort and time devoted to its design, conduct and evaluation are quite inadequate. ¾ In practice, orientation is often just a superficial indoctrination into company philosophy, policies and rules. ¾ Many a time orientation is just the presentation of an employee handbook and a quick tour of the office or plant. ¾ Upon entering a new job, the experienced worker who had experience in other organizations or a new college graduate will face the same kind of ‘culture shock’ as they are exposed to a new

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organizational culture. Both may find that the new job is not quite what imagined to be. ¾ An effective orientation programme can help lessen the impact of ‘culture shock’. ¾ The cost of hiring, training and orienting a new person is far higher than the general expectation. ¾ A new employee’s experiences during the initial period with an organization can have a major impact on the employee’s career. ¾ A new employee sits on the ‘boundary’ of the organization; i.e., no longer an outsider but not yet accepted by those within the organization. ¾ As there is great stress experienced by the new employee, he/she wants to reduce the stress by becoming a part of the ‘interior’ as quickly as possible. ¾ This is the period when an employee is more receptive to cues/ information from the organization than any other period. ¾ The cues/information come from various sources: official literature of the organization, examples set by seniors/peers, instructions from managers, rewards/punishments as a result of the employee’s efforts, responses to employee’s ideas and degree of challenge in the employee’s assignment. ¾ Special problems may arise for new college graduates. As they approach their first jobs, they may feel motivated entirely by personal creativity. ¾ New college graduates are information-rich but experience-poor, eager to apply their knowledge to new processes and problems. Unfortunately, organizational conditions may stifle their creative urge. ¾ During college days, the new employees had direct control over their work. But now they face regular hours, greater restrictions, possibly a less pleasant environment and a need to work with other people. They may feel the jobs mundane and unchallenging. ¾ The new employee will have several questions: Will he/she be acceptable to other group members? Will it be safe, i.e., free from physical and psychological harm? In addition to the information on pay/benefits, vacations and company policies, will there be adequate and unambiguous information on employee norms, company attitude and other intangibles? Does the new environment

New employees need information on areas like company standards, expectations, norms, traditions, policies, social behavior, such as approved conduct, work climate and getting to know fellow workers and supervisors and technical aspects of the job.

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help or hinder the employee development? Will the peers socialize and cooperate? ¾ The first year with an organization is the critical period during which an employee may or may not learn to become a high performer ¾ Careful matching of company and employee expectations during the first year can result in positive job attitudes and high standards, which can be reinforced in new and more demanding jobs There must be a formal and systematic follow-up of orientation through focus groups of randomly selected new employees and a review of the checklist of items covered.

Some time will certainly lapse between the acceptance of a job and the actual start date. Many organizations use this time to begin the orientation process. Some companies send new employees the employee handbook along with information about the geographical area, and ongoing projects in the department. Broadly, new employees need specific information in three areas: ¾ Company standards, expectations, norms, traditions and policies ¾ Social behavior, such as approved conduct, work climate and getting to know fellow workers and supervisors ¾ Technical aspects of the job More of paper work on day one which may deprive the new employees the opportunity to meet people, putting employees to work, a quick and superficial orientation, insignificant duties in the pretext of ‘from the group up’, and suffocating the new employees with too much information too fast must be avoided.

Orientation programme must be evaluated through an annual review to find out if the objectives of the orientation programme are achieved, to identify future improvements and to get a comprehensive feedback from everyone involved in the programme.

Orientation Follow-up Many organizations commit the blunder of ignoring the new employees after orientation. Instead of telling “see me sometime whenever you have any questions”, there must be a formal and systematic orientation followup. Focus groups of randomly selected new employees will help the organization find out what the employees like and don’t like. Sometimes many of the topics covered in the orientation need to be explained again consequent to the employees experiencing them first hand. There must be a review of the checklist of items covered. The completed check-list must be signed by the HR representative, the supervisor and the new employee.

Evaluation of Orientation Programme ¾ There must be an annual review to find out if the objectives of the orientation programme are achieved and to identify future improvements.

Chapter 6: Socialization and Orientation

¾ To improve orientation there must be candid, comprehensive feedback from everyone involved in the programme. Feedback is received through many ways: in-depth interviews with randomly selected employees and supervisors, questionnaires for coverage of all the new employees and round table discussions with the new employees after their first year. Points to Ponder in Orientation: ¾ As first impression must be the best impression, day one is crucial. It must be managed well because employees remember it for years. ¾ The impressions formed during the first 60-90 days on a job are lasting. ¾ New employees are interested in learning about the organization as a whole and how they fit into it. ¾ Employees are given major responsibility for their own orientation through guided self-learning with direction and support. ¾ Overloading of information is to be avoided; information are to be provided in reasonable amounts. ¾ It must be recognized that community, social and family adjustments are critical aspects of orientation. ¾ The immediate supervisors are made responsible for the success of orientation process.

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The critical aspects of orientation are managing ‘day one’ well, forming better impressions during the first 60-90 days on a job, making new employees learn about the organization as a whole and how they fit into it, giving guided self-learning with direction and support, proving information in reasonable amounts, including community, social and family adjustment aspects, making immediate supervisors responsible for the success of orientation process, and realizing the importance of orientation for improvement of productivity and that it is a vital part of the total management system.

¾ Thorough orientation is a ‘must’ for improvement of productivity. ¾ Orientation is a vital part of the total management system.

Review Questions Review Questions Answer in brief

1. What is socialization?

7. What is anticipatory socialization?

2. What is orientation?

8. What is realistic job preview?

3. List the assumptions of socialization.

9. What are the elements of orientation?

4. How do individuals adjust to new situations?

10. What is orientation follow-up?

5. What are the two types of socialization?

11. H o w d o y o u e v a l u a t e o r i e n t a t i o n programme?

6. What is organization socialization? Answer in detail 1. Explain the process of socialization.

2. Explain the features of orientation.

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3. Elaborate the characteristics of effective orientation.

4. Discuss the role of CEO in orientation. 5. Discuss the role of HRM in orientation

Specialists Speak

Specialists Speak Specialists Speak – 1

Unnati Narang

For Freshers at Work A first job can give anyone the jitters but if mentored correctly, they can be an asset to the organisation. Adjusting to a new person in the team can be bit of a task. However, with a little effort, companies can be sure that a fresher in a team is not only welcomed but becomes a crucial part of the team within no time. So what can the senior members of a team and management do to turn a fresher into an asset? Old vs. New Senior management often view freshers as inexperienced and hence, not sufficiently skilled. When they come in, they tend to challenge set patterns. This is the first hurdle to freshers becoming an asset to any team. “Given that experienced professionals are used to a certain way of working which has delivered results in the past, it is quite natural that the mind gets conditioned to follow the same. It is a problem of mindset which every experienced professional goes through when challenged or exposed to a new idea. At the same time, from a fresher’s perspective, he may be reluctant to bring forth or share a new idea with his seniors due to the fear of being rejected or ridiculed,” says Deepa Poncha, Head, Human Resources, Centrum Group. To avoid such a stalemate, organisations must go back to their books and take a leaf out of Fredrick Taylor’s mental revolution concepts. “Negativity at a workplace is nothing but conflict of opinions based on prior experiences. For example, an experienced professional working on a project will have a different approach from that of a fresher. Often these situations might lead to negativity due to strong biases. To mitigate unconstructive emotions at the workplace, it is essential for the companies to design strong communication platforms to motivate and encourage team building exercises to fabricate strong interpersonal skills and positive attitude,” says Prashant Bhatnagar, Director Hiring, Sapient - India. Mentoring Newbies It is important for experienced professionals to see the other side of having a fresher in the team. Saravanan, Head, Engineering at Nyootv, has been part of several mixed teams where freshers and seniors work together. What qualities does he see freshers bringing to the table? “Since they

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have no work experience, they tend to work harder. They can be put to work on any technology; this is not always possible with experienced professionals who have already trained and worked on specific technology for a while and are reluctant to change. In a typical work situation, some of the mundane tasks can be delegated to freshers. This way, they automatically motivate their senior in the team to do high-end work,” says Saravanan. Shikhar Gupta, an engineering graduate, recently started working at a tech firm in Bangalore. He works in a small team with other new joinees under the mentorship of a senior. “As a fresher in a team, you are not expected to start performing and giving results on day one. Most companies have a training period. This acts as a window for the fresher to learn. In the initial months, the fresher becomes an asset to the company by way of what he learns, thereby adding value in subsequent periods. But for that learning to take place, a supportive team is critical,” says Gupta. While the fresher should come in with an open mind, a large part of the responsibility of turning the person into a crucial asset to the team lies with the company. “The onus of ensuring that the fresher is an asset to the team rests largely with the HR and the team of experienced professionals. Thorough orientation and regular feedback sessions should be held to understand possible gaps and plug in the same. Freshers should be given a chance to work on live projects,” says Poncha. Size Matters How does the size of any team affect the role of a fresher? “Generally, freshers feel more comfortable in smaller teams; where they are not afraid to speak out and voice their opinions. In larger teams, freshers have a tendency to blend with the crowd, as they take on a role of a quiet observer. For a fresher to be an asset to a team, the team manager should bring out the best in him,” says Prashant Bhatnagar, Director Hiring, Sapient - India. Ultimately, for anyone to be an asset to the team, shared interest must prevail over personal interest of individual team members. (Source: http://articles.timesofindia.indiatimes.com/2013-05-28/work/29812219_1_fresherasset-human-resources) Specialists Speak – 2

Preethi Varma, Senior Marketing Analyst, Zoho

The Social Workplace Here are ways to put social media platforms to good use Traditionally, people used to work for set hours on set days with a set number of holidays each year. The nine-to-five schedule had made its place in workplace history. One could spot the bored office clerk, buried among his piles of files with loads of mundane chores. Thanks to the advent of technology, the clerk has transformed into a bored executive gaping into his wide-screened computer.

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The undisputed champion that still remains is ‘boredom’. This undisputed champion was then challenged by social media channels like Facebook and Twitter. Now, what happened to ‘productivity’? The merits of external social media are that it facilitates open communication and information transaction; provides an opportunity to widen business contacts and engage customers; expands market research and helps in implementing marketing campaigns to interested audiences. What may be the most concerning aspect of external social networking platforms is that these networks encourage people to share information that they are not supposed to. The lack of productivity is more about many employees wishing to do something meaningful; something that really engages them. The next question is - what can the company or organisation do to capture this ‘engagement’? A recent survey from Gartner has found that only 29 per cent of employees are engaged at work, with 52 per cent identifying as unengaged, and 19 per cent as disengaged. The solution lies right before us - the Enterprise 2.0 tools, which primarily focus on communication. Like the adoption of emails, intranets and internal forums - gamification is a recent trend. How about a social networking tool within the organisation? Well, in layman terms, we may call it a Facebook-like tool for organisations which can enhance the productivity of employees and drive engagement. Enterprise social technologies can flatten organisations. A McKinsey study reveals that improved communication and collaboration through social technologies could increase productivity of interactions of workforce by 20-25 per cent. Knowledge-sharing and Finding Expertise Many employees are having a hard time finding information and expertise on a specific topic within the organisation. Much of it exists as tacit knowledge. Learning is also equally important and often occurs informally by working together and collecting information. Certainly, social technologies aid in the process by changing the way employees collect, organise and distribute this information. This can be in the form of forums or blogs incorporated within enterprise social technologies. Boosting Motivation and Innovation Appreciation is what motivates an employee. A recent survey by the American Psychological Association (APA) on employee engagement found that only 54 per cent felt valued by the employer, but of those, 93 per cent were motivated to do their best and 88 per cent felt engaged. Of those who did not feel valued, only 33 per cent were motivated to do their best and only 38 per cent felt engaged. It is easier to trumpet the achievement of performing employees using social technologies. Flow of Ideas and Feedback With ‘likes’ and comments incorporated in social media technology within an organisation, employees can voice their feedback or ideas. There is freedom of thought and democracy that is built in the company culture. It changes the way teams interact and collaborate. Promoting Transparency An open-door policy at work helps in developing a friendly and transparent organisational culture. The implementation of a secure social media technology within the organisation aids transparency,

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as all employees are aware of what’s happening within the company, irrespective of their hierarchies.The adoption of social media within workplaces is sure to change the way organisations are managed and the way people collaborate and work. It affects the company culture in a positive way. It is sure to drive efficient and effective interactions within the organisation, thus leading to a productive workforce. And if all this changes, then the organisation-customer interactions are also bound to change. (Source: http://itsmyascent.com/cms?targeturl=web%2Fitsmyascent%2Fhr-zone%2F%2Fasset_publisher%2FzM4i%2Fcontent%2Fthe-social-workplace)

Case Study

Case Study Case 1

Kavita Verma (Kavita) was a well-qualified Secretary with more than twenty years of experience in several industries. During these twenty years of experience, she worked mostly in manufacturing firms and her secretarial work was mostly restricted to organizing her work and that of her superiors. Global Financial Services, a major financial services firm in the country, advertised for a wellqualified Secretary. Kavita possessed the qualifications that the firm had advertised. Moreover, the firm offered better benefits than the present company. The salary and benefits were too good for Kavita to reject the job. Though Kavita was happy with her present job where she had been working for five years, the pay and the location of the financial services firm was better. Keeping all these factors in mind, she took up the new job, wishing to have a more challenging job. Right from the day she joined the new job, she found the work atmosphere in the financial services firms to be totally different. The job required teamwork and all the members of the team shared a range of duties and responsibilities. Kavita found that there was a lot of communication gap between her manager and herself. This was not the case in the former organization. Here, she was unable to participate in team building activities, and yearned to be able to express her own feelings and opinions openly without fear of loosing credibility with her colleagues. Being used to calm and privacy work environment, she felt uncomfortable working in the open-plan arrangement. Kavita was also not comfortable talking with her colleagues and started avoiding them during lunch hours also. Slowly she found excuses not to go to work. A slight temperature would stop her from going to work. This was not the case in her previous office. After a month, Kavita started applying for other jobs. This time she applied for jobs in manufacturing firms that would be comfortable for her to work in. Soon she was offered a job by a shipping company. Though the pay offered and the location of the firm was not as a good as Global Financial Services, she accepted the idea only to get rid of the present job. This time she took

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precaution to choose the right job. Here she was happy with the work atmosphere and was able to concentrate on her job. As a result, she was promoted twice in a year. Questions: 1. Analyze the case with the help of the “big five” dimensions of personality. 2. What steps could the HR Manager at Global Financial Services taken to avoid the problems associated with Kavita? (ICFAI University, 2008)

Case 2 Mr. Y was appointed as HR executive in an organization that produces and sells consumer goods. He was on orientation training in various departments for six months. At the end of the training period, he was asked to give some constructive feedback for the general improvement of organization. During the training, he had observed a lot of communication errors occurring at various levels. He had also provided this feedback to his authorities. One day, Mr. X’s General Manager asked him to make a power-point presentation (to employees at various levels) on “Towards minimising communication errors”. If you were in his position, what contents would you include in your presentation? Explain. (Satyabama University, December 2012)

Classroom Project

Classroom Project

Students are assigned to imaginary organizations in various industries. They have to prepare the following. 1. Anticipatory socialization report that can be given to different levels of new recruits of their chosen organization. 2. Orientation training programme design that will suit the chosen organization for different levels of employees.

Field Project

Field Project

The students are instructed to visit various firms to find out what types of socialization and orientation practices are followed. They can also interview the employees at different levels to find out whether the socialization/orientation programmes are really helpful. They can also get the suggestions from the employees to improve the socialization and orientation programme. The details are analyzed in the classroom.

Training •

HRM - Indian Perspective

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What is Training?

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Training vs. Development

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Need for Training

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Evaluation Design

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Structural Issues in Training

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Key Terms Training Development

On-the-Job Training

ROI in Training Structural Issues

Designing Effective Training Programme - Training Process

Characteristics of Effective Training Practice

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Review Questions

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Specialists Speak

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Case Study

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Classroom Project

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Field Project

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HRM – Indian Perspective

ICICI Bank

ICICI Bank Limited

Shri. K.V.Kamath, Chairman

The Industrial Credit and Investment Corporation of India Limited was incorporated in 1955 at the initiative of World Bank with the objective of creating a development financial institution for providing medium-term and long-term project financing to Indian businesses. In 1994, ICICI established Banking Corporation as a banking subsidiary. ICICI Banking Corporation was later renamed as ‘ICICI Bank Limited’. ICICI Bank is known for its good HR practices. The hierarchy levels are well defined with clear job descriptions. The career development opportunities are mostly given for internal sources. There is more horizontal growth in the organization with cordial employee relation environment. The bank has a referral forum in company’s web-page viz. ‘ATLAS’. For managerial roles, the company traces out the performance of existing employees and conduct a review of selection process. The sources of recruitment are advertisements in newspaper, radio, T.V, magazines; Campus Recruitment, Head hunters, Executive search, Job Portals, Consultancies or agencies, Employee Referrals and Walk – ins. Every job has a well defined job design in the organization. They decide Job Description Key Responsibilities Areas (KRAs) before making advertisements and then go for posting the advertisements. The selection process is done through Aptitude Test, Group Discussion, Psychometric profiling and Personal interview. Probationary officers undergo one-year intensive residential classroom training at ICICI Manipal Academy and internship. On successful completion, they get absorbed as Manager or Assistant Managers. Training at ICICI Bank covers basic training and there is a video based program to equip the branch staff with requisite service skills to deliver the better service to customers viz. “Skill Through Drill”. For B-School hires, there is an induction programme including business etiquettes for first three weeks. They are allowed to work for 3-4 months with intensive 9 to 9 technical training for one week. One week training programs are common for all employees every year. The company also has business leadership programme. It has partnered with National Institute of Securities Markets to launch Post Graduate Certificate in

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Securities Markets (PGCSM). On successful completion of the course, participants get absorbed at ICICI Bank or any other group company as a Manager. Behaviour Training Programmes are conducted for middle and senior professionals. The bank has won the prestigious “Best Use of Technology in Training and e-Learning” by Indian Banks Association (IBA) Technology Awards. The “Performance Appraisal” system in ICICI bank emphasizes individual objectives, bank objectives and also mutual objectives. The emphasis is on growth and development, harmony, effectiveness and profitability of the bank. They follow “RANK AND YANK” strategy with best-to-worst ranking methods used for identifying poor performers. The identified poor performers are then given a time period to show an improvement in their performance. If the employee fails, he / she are asked to leave the organization and a severance package is offered. If the employee refuses to leave, his service is terminated without any compensation. It continuously motivates employees to improve their performance since nobody would like to be included in the poor performance band. MBO is also used in the organization. The subordinate in consultation with the supervisor chalks out short term objectives followed by specific actions. The activities are jointly reviewed by both the subordinate and his supervisor. Depending on the performance of the subordinate, the goals are modified or redesigned for the next period of time. The performance appraisal system at ICICI bank includes self assessment, 360o degree feedback process and appraisal interview. They have a laid-out whistle blower policy to ensure ethical practices. There are interaction sessions for the employees to engage with senior management to discuss and resolve concerns. The notable rewards include ESOPs, annual promotions and bonuses. Employee benefits are salary & benefits, family health insurance, flexibility to innovate, retirement benefits, gratuity, superannuation fund, pension, provident fund, leave encashment, housing allowances, sick leave, maternity leave and the like.

What is Training? Training is a planned effort to facilitate the learning of job-related knowledge, skills and behaviour by employees. ¾ Training is to improve performance at the individual, group and/or organizational level. ¾ Improved performance implies that the changes in knowledge, skills, attitude and /or behaviour are measurable. Figure 7.1: Training Session in Progress

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Training is a planned effort to facilitate the learning of job-related knowledge, skills and behaviour by employees. Training is said to be more narrowly focused and oriented towards shortterm performance concerns while development tends to be oriented more towards broadening an individual skills for future responsibilities. The two terms are combined to recognize the combination of activities to increase the skill base of employees.

High leverage training is a training practice that is linked to strategic business goals and objectives, uses an instructional design process to ensure that training is effective and compares the firm’s training programmes of other firms.

Training vs. Development The term training is generally used to describe any effort initiated by an organization to help learning among its employees and develop them. However, many experts distinguish between training and development. Training is said to be more narrowly focused and oriented towards shortterm performance concerns while development tends to be oriented more towards broadening an individual skills for future responsibilities. In simple terms, training is present oriented that focuses on individuals’ current jobs and development is future-oriented focusing on employee personal growth. The two terms tend to be combined into a single phrase, training and development to recognize the combination of activities to increase the skill base of employees. Traditionally emphasis on training has been at the basic as well as advanced skill levels. But surveys have indicated that many jobs require extensive use of knowledge. This is possible only when the employees share knowledge and creatively use it to modify a product or service and also understand the product/service development system. This is known as high leverage training and continuous learning. High Leverage Training: It is a training practice that is linked to strategic business goals and objectives, uses an instructional design process to ensure that training is effective and compares the firm’s training programmes of other firms. Continuous Learning: It is a learning system that requires employees to understand the entire work system including the relationships among their jobs, work units and the company. Employees are expected to acquire new skills and knowledge, apply them on the job and share the acquired information with other employees.

Need for Training Continuous learning is a learning system where employees are expected to acquire new skills and knowledge, apply them on the job and share the acquired information with other employees.

Present business trend suggests that more money and time will be spent in future for training. Rapid changes such as automation, worker displacement as a result of mergers, acquisitions and downsizing and shift from manufacturing to service jobs necessitate more training. Competition: As a result of hyper competition, both domestic and international, largely due to trade agreements and technology (notably the internet), employees will be required to constantly engage in business strategies/models.

Chapter 7: Training

Customer Power: Due to internet, now, the customers compare prices and products online necessitating the firms to train the employees to satisfy the customers’ queries and needs. Globalization: Consequent to globalization resulting in formation of multinational teams, training has become an essential part to address cultural and language issues. Creating and Maintaining Talent: As products and services can be copied, there is a need for innovation, refining processes, solving problems and forming relationships. Hence, retaining and developing people through competent training programmes are critical for success.

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The factors that necessitate more training are competition, customer power, globalization, creating and maintaining talent, diversity in workforce, technology and team requirements.

Diversity in Workforce: Demographic data suggest that there are many unskilled and under-educated youth and underutilized groups. They all need adequate training to make them productive. Technology: Changes in technology impose training and retraining on the existing workforce to update their knowledge. Team Requirements: As organizations shift to employee engagement and team formation in the workplace, team members must be trained to learn behaviours such as asking for ideas, offering help without being asked, listening and feedback skills and recognizing and considering the ideas of others.

Designing effective Training Programme – Training Process Training design process is a systematic approach for developing training programmes. The two models generally adopted are ISD (Instructional System Design) and ADDIE (Analysis, Design, Development, Implementation and Evaluation). Noe et al (2008) advocated a six-step process which includes all the facets of a training programme, namely, needs assessment, ensuring employees’ readiness for training, creating a learning environment, ensuring transfer of learning, selecting selection methods and evaluating training programmes.

Figure 7.2: Training Session in a Corporate Office

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Figure 7.3

The Training Process (Developed by Noe et al , 2008) Step 1. Needs Assessment ¾ Organizational analysis ¾ Person analysis ¾ Task analysis

Training design process is a systematic approach for developing training programmes. The two models generally adopted are ISD (Instructional System Design) and ADDIE (Analysis, Design, Development, Implementation and Evaluation).

Step 2. Ensuring Employees’ Readiness for Training ¾ Attitudes and motivation ¾ Basic skills Step 3. Creating a Learning Environment ¾ Identification of learning objectives and training outcomes ¾ Meaningful material ¾ Practice ¾ Feedback ¾ Observation of others ¾ Administering and coordinating programme Step 4. Ensuring Transfer of Training ¾ Self-management strategies ¾ Peer and manager support Step 5. Selecting Training Methods ¾ Presentational methods ¾ Hands-on methods ¾ Group methods

The steps of training process are needs assessment, ensuring employees’ readiness for training, creating a learning environment, ensuring transfer of training, selecting training methods and evaluating training programmes.

Step 6. Evaluating Training Programmes ¾ Identification of training outcomes and evaluation design ¾ Cost-benefit analysis

Step 1: Needs Assessment Needs assessment refers to the process used to determine whether training is necessary. There are many factors or compelling reasons to suggest that training necessary. The factors or reasons include performance problems, new technology, requests for training, job redesign, new legislation, changes in customer preferences, new products, employees’ lack of skill etc.

Chapter 7: Training

Needs assessment generally involves organizational analysis, person analysis and task analysis. Organizational Analysis: This involves determining the business appropriateness of training compared to the company’s business strategy, its available resources for training and support by managers and peers for training activities. Person Analysis: Person analysis helps identify who needs training. This involves: ¾

Determining whether performance deficiencies result from a lack of knowledge, skills or ability or from a motivational or work-design problem

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Identifying who needs training and finding out the employees’ readiness for training

Task Analysis: This includes identifying the important tasks and knowledge, skill and behaviours that need to be emphasized in training for employees to complete their tasks. A task is a statement of an employee’s work activity in a specific job. Steps involved in task analysis are: ¾

Selecting the job(s) to be analysed.

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Developing a list of tasks performed on the job by interviewing and observing expert employees/managers and discussing with those who have performed a task analysis.

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Validating or confirming the list of tasks with subject matter specialists.

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Identifying the knowledge, skills or abilities necessary to perform each task. The information can be collected through interviews and questionnaires.

Step 2: Ensuring Employees’ Readiness for Training Readiness for training refers to whether: ¾ The employees have the personal characteristics such as ability, attitudes, beliefs and motivation necessary to learn program content and apply it on the job, and ¾ The work environment will facilitate learning and not interfere with performance.

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Needs assessment refers to the process used to determine whether training is necessary. It involves organizational analysis, person analysis and task analysis. Organizational analysis involves determining the business appropriateness of training compared to the company’s business strategy, its available resources for training and support by managers and peers for training activities. Person analysis helps identify who needs training. Task analysis includes identifying the important tasks and knowledge, skill and behaviours that need to be emphasized in training for employees to complete their tasks.

Readiness for training refers to whether the employees have the personal characteristics such as ability, attitudes, beliefs and motivation necessary to learn program content and apply it on the job. The work environment should facilitate learning and not interfere with performance.

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Managers play an important role in influencing employees’ readiness for training. They need to ensure that employees’ motivation to learn is as high as possible. This is achieved by: ¾ Ensuring employees’ self-efficacy. ¾ Making the employees to understand the benefits and consequences of training. ¾ Creating the awareness of training needs, career interests and goals, and ¾ Helping the employees to know about the work environment characteristics. Further, the motivation to learn is also influenced by basic skills (reading, writing and communication skills) needed to understand the content of a training programme and cognitive ability which includes three dimensions viz. verbal comprehension, quantitative ability and reasoning ability.

Step 3: Creating a Learning Environment To acquire knowledge and skills in the training programme and apply the same in the jobs, the training programme must include certain learning principles. ¾ Employees Need to Know Why they should Learn?: The trainees must understand the purpose or objectives of the training programme. ¾ Employees need meaningful training content: Training content includes linking of training with the current job experiences / tasks, using of concepts, terms and examples familiar to trainees and making sure that training context such as physical, intellectual and emotional environment merge with the work environment. HRM – In lighter vein

¾ Employees Need Opportunities to Practice: Unless opportunities are created for the trained employees to practice what they learnt, training becomes a futile exercise. Practice involves making the employee demonstrate the learned capability emphasized in the training. Effective practice involves repeated practice, taking appropriate time period and adequate unit of learning (amount of material). Practice must be relevant to the training objectives. ¾ Employees Need Feedback: Feedback helps trainees in understanding to what extent they learnt. To be effective feedback must be specific and provided without loss of time.

Chapter 7: Training

It is advisable to praise the employees for positive behaviour. Videotape is quite powerful for giving feedback. ¾ Employees Learn by Observing, Experience and Interacting with Others: Social learning theory tells that people learn by observing and imitating the actions of role models. For social learning to be effective, the models should have appreciable traits. Further, trainees should have the opportunity to practice the skills/ behaviour of the models. In social learning, communities of practice play an important role. Communities of practice are groups of employees who work together, learn from each other and develop a common understanding of how to get the work done.

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Social learning theory tells that people learn by observing and imitating the actions of role models. For social learning to be effective, the models should have appreciable traits.

¾ Employees Need to Memorize the Training Contents: Trainers can teach keywords, a procedure or a sequence of a visual image to make the trainees remember the training contents. Creating a link between what the trainees already know and what has been taught in the training makes things easy to remember. ¾ Employees Need the Training Programme to be Properly Coordinated and Arranged: Training administration, which refers to coordinating activities before, during and after the programme is an important aspect in making training effective. Good coordination ensures the following: ¾ Trainees are not distracted by events such as poor ventilation, uncomfortable seats, inadequate/inappropriate materials that could interfere with learning. ¾ Communicating to the trainees the purpose of the training, exact place/time, name(s) of person(s) to contact in the event of any doubt and any assignment to be completed. ¾ Preparation of books, speakers, hand-outs, videotapes etc. ¾ Allocation of rooms with needed equipments. ¾ Avoiding distraction such as phone calls. ¾ Adequate time to provide feedback about the programme.

Step 4: Ensuring Transfer of Training Learning is influenced by the learning environment such as meaningfulness of the material and opportunities for practice/feedback and employees’ readiness for training with self-efficacy and basic skill level. Transfer of

Communities of practice are groups of employees who work together, learn from each other and develop a common understanding of how to get the work done.

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Climate for transfer refers to training perceptions about the characteristics of work environment such as social support, opportunity to use the learned skill consequences for employing the learned capabilities etc.

training occurs only when learning occurs. When no learning has taken place due to one factor or the other, the question of transfer of learning does not arise. Transfer of training means the use of knowledge, skills and behaviours learned in training on the job. Transfer of training is influenced by Climate for transfer (technological support). Climate for transfer refers to training perceptions about the characteristics of work environment such as social support, opportunity to use the learned skill consequences for employing the learned capabilities etc. That may facilitate or inhibit the transfer of training. Factors influencing the climate for transfer are: ¾ Manager support ¾ Peer support ¾ Self-management skills ¾ Opportunity to use learned skills Manager support refers to the degree to which the trainees’ managers emphasize the importance of attending training programmes and stress the need for applying what has been learned to the job. ¾ The greater the level of manager support the more likely that transfer of training will occur. ¾ The basic level of support that a manager should provide it allowing trainees to attend training and the highest level is to participate in training as an instructor. ¾ Managers, who serve as instructors are likely to reinforce use of newly learned capabilities, discuss progress with trainees and provide opportunities to practice. Managers can also facilitate transfer of training through the use of action plans. An action plan is a written document that includes the steps that the trainee and manager will take to ensure that training is transferred to the job. The action plan includes identifying and use of training contents, resources needed, getting feedback and expected outcome. The action plan includes time schedule also.

“You seem to be coming along well”, Harlen

HRM–In lighter vein

Peer support is a support network among the trainees. Group of two or more trainees agree to meet and discuss their progress in using the learned capabilities on the job. This is accomplished through:

Chapter 7: Training

¾ Face-to-face meetings or communications via email. ¾ Sharing successful experiences in using training content on the job. ¾ Discussing how they obtained resources needed to use training content. ¾ Communicating how they coped with a work environment that interfered with the use of training content.

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EPSSs are computer applications that can provide skills training, information access and expert advice on request.

Technical support is provided through electronic performance support systems (EPSS). EPSSs are computer applications that can provide skills training, information access and expert advice on request. EPSSs may be used to enhance transfer of training by providing trainees an electronic information source that can be referred to as and when needed by the trainee. Self-management skills are the ability of the trainees to use the new skills Self-management skills are the ability of the and behaviour learned on the job. ¾ Trainees should set goals for using skills/behaviour on the job. ¾ Identifying conditions which are not conducive to use the training content. ¾ Finding out the positive and negative consequences of using training content. ¾ Monitoring the use of training content. ¾ Preparing to meet any failure. ¾ Creating their own reward system and asking for feedback from managers. Opportunity to use learned capabilities or opportunity to perform refers to the extent to which the trainee is provided with opportunity to use the newly learned knowledge, skills or behaviour. Opportunity to perform is influenced by: ¾ Work environment such as assigned problems/tasks. ¾ Trainee motivation, that is, the degree to which trainees take personal responsibility to actively seek out assignments that allow them to use newly acquired capabilities.

Step 5: Selecting Training Methods As the success or failure of a training programme is often related to certain principles of learning, it is to be understood that different training methods vary in the extent to which they utilize these principles. Training programmes

trainees to use the new skills and behaviour learned on the job.

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Principles of learning are goal setting, meaningfulness of presentation, familiarity, modeling, individual differences, active practice and repetition, whole-vs.-part learning, distributed learning and feedback.

are likely to be more effective if the principles of learning are followed. Selection of appropriate training programme depends on the following principles of learning. Goal Setting: When trainers take time to set goals and objectives to trainees or when trainees are encouraged to set goals on their own, the level of interest, understanding and efforts put in are likely to increase. Meaningfulness of Presentation: The material to be learned must be presented in as meaningful a manner as possible. Trainees are able to learn new information if they connect it with things which are already familiar to them. For effective presentation: ¾ Colourful examples are to be used. ¾ Examples must make the material meaningful. ¾ Materials are to be arranged in such a way that experience builds on preceding ones. ¾ Trainees must be able to integrate the experiences into a usable pattern of knowledge and skills. Modeling: Modeling increases the salience of behavioural training. People learn easily by watching. Modelling can take many forms such as real-life demonstrations, videotapes, pictures, drawings etc. Modeling demonstrates the desired behaviour or method to be learned. Individual Differences: People learn in different rates and in different ways. Some learn quickly, some take considerable time. Some do things awkwardly in large groups but excel in small groups. To the extent possible training programmes should try to accommodate the individual differences to facilitate each person’s style and rate of learning. Active Practice and Repetition: Trainees should be given frequent opportunities to practice what they learn. For example, the individual who is being taught how to operate equipment must be given opportunity to practice on it. Whole-vs-Part Learning: Most jobs/tasks can be broken down into smaller parts for analysis. Determining the most effective manner for completing each part provides a basis for giving specific instruction. In evaluating wholevs.-part learning, it is necessary to consider the nature of the task to be

Chapter 7: Training

learned. If the task can be broken down conveniently, it should be broken down to facilitate learning; otherwise it should be taught as a whole. Distributed Learning: It has been found in most cases that spacing out the training will result in faster learning and longer retention. (e.g., Giving 10hour training in five two-hour sessions than in two five-hour sessions). However, the efficiency of the distribution will vary with the type and complexity of the task. Feedback: Feedback from self-monitoring or from trainers, fellow trainees, observers and others serves two purposes, namely, knowledge of results and motivation. Feedback helps individuals to understand whether they are doing the right things or the wrong things. That is, it serves ‘shaping’ role in helping individuals approach the training objectives. Feedback always motivates people. Negative feedback makes the individual to do the right thing appropriately. Positive feedback encourages doing better. Training Methods for Non-managerial Employees There are many methods available for training employees at all levels from old methods to advanced computer aided techniques.The methods can be generally grouped into two categories, on-the-job training and off-the-job training.

Hands-on Methods or On-the-job Training (OJT) It is a method by which employees are given hands-on experience with instructions from their supervisor or other trainer. ¾ It is the most common method used for training non-managerial employees ¾ It has the advantage of providing hands on experience under normal working conditions ¾ It provides an opportunity for the trainer

Figure 7.4: Training Methods

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(manager or senior employee) to build relationships with new employees. ¾ It is considered to be potentially the most effective means of learning in the workplace as time is a critical resource. Common Drawbacks: Though used by all types of organizations, it is one of the most poorly implemented training methods. Figure 7.5: On-the-job Training Types of training methods for non-managerial employees are on-the-job and off-the-job. On-thejob methods are hands-on training, apprenticeship and internship training.

Three common drawbacks are: ¾ Lack of a well-structured training environment. ¾ Poor training skills of managers. ¾ Absence of well-defined job performance criteria. To overcome the above drawbacks experts suggest the following: ¾ Developing realistic goals and/or measures for each OJT area. ¾ Planning a specific training schedule for each trainee, including set periods for evaluation and feedback. ¾ Helping managers to establish a non-threatening atmosphere conducive to learning. ¾ Conducting periodic evaluations, after training is completed, to prevent regression.

Hands-on is a method by which employees are given hands-on experience with instructions from their supervisor or other trainer.

Snell and Bohlander (2007) proposed a ‘PROPER’ (Preparation, Reassurance, Orientation, Performance, Evaluation and Reinforcement/Review) way for effective OJT. Preparation: Deciding what employees need to be taught, identifying the best sequence or steps of the training and deciding how best to demonstrate these steps keeping the materials, resources and equipment ready. Reassurance: Putting each employee at ease, learning about the employees’ prior experience and adjusting accordingly and trying to get the employee interested, relaxed and motivated to learn. Orientation: Showing the employee the correct way to do the job, explaining why it is done in a particular way, discussing how it relates to other jobs and letting the employee ask lots of questions.

Chapter 7: Training

Performance: Letting the employees try the jobs themselves when they are ready, giving them an opportunity to practise the job and guiding them whenever there are problems and providing help and assistance initially and withdrawing gradually. Evaluation: Checking the employees’ performance and questioning them on how, why, when and where they should do something, correcting errors and repeating instructions.

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Apprenticeship is a system of training in which a worker entering a skilled job is given thorough instructions and experience both on and off the job, in the practical and theoretical aspects of the job.

Reinforcement and Review: Providing praise and encouragement and giving feedback about how the employee is doing, continuing the conversation and expressing confidence in the employee doing the job. Apprenticeship Training: It is an extension of onthe-job training. It is a system of training in which a worker entering a skilled job is given thorough instructions and experience both on and off the job, in the practical and theoretical aspects of the job. An apprentice gets a certain percentage of the worker’s wage or a fixed amount during the apprenticeship period. After Figure 7.6: successful completion of the apprenticeship, the employee will start getting Apprentices in Training full wages. Internship programmes Apprenticeships are a good way to train employees, especially in skilledtrade industries (machinist, laboratory technician, electrician and others). Internship Programmes: These are programmes jointly sponsored by colleges, universities and other organizations that offer students the opportunity to gain real-life experience while allowing them to find out how they will perform in their organizations. Organizations benefit by getting student-employees with new ideas, energy and eagerness to accomplish their assignments.

Off-the-job Training Methods or Presentation Methods Off-the-job training methods include the traditional classroom instruction, distance learning, audio-visual techniques etc. In presentation methods, the trainees are passive recipients of information.

are jointly sponsored by colleges, universities and other organizations that offer students the opportunity to gain reallife experience while allowing them to find out how they will perform in their organizations. Off-the-job training methods are classroom instruction, distance learning, teleconferencing, audiovisual instruction, simulation and vestibule method.

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Figure 7.7: Classroom Training Classroom training enables the maximum number of trainees to be handled by the minimum number of instructions. Distance learning is used by geographically dispersed companies to provide information about new products, policies or procedures as well as skills training and expert lectures to field locations.

Classroom Instruction: ¾ Classroom training enables the maximum number of trainees to be handled by the minimum number of instructors. ¾ This method is suitable for ‘blended’ learning where lectures and demonstrations are combined with films, DVDs, videotapes or computer instruction. ¾ It typically involves having the trainer lecture a group. ¾ In many cases the lecture is supplemented with question-andanswer sessions, discussion or case studies. ¾ It is one of the least time-consuming ways to present information on a specific topic to many trainees. Distance Learning: It is used by geographically dispersed companies to provide information about new products, policies or procedures as well as skills training and expert lectures to field locations ¾ Distance learning features two-way communication between people. ¾ Distance learning currently involves two types of technology viz. teleconferencing and individualized, personal- computer-based training.

Teleconferencing refers to synchronous exchange of audio, video and/or text between two or more individuals or groups at two or more locations.

Teleconferencing: It refers to synchronous exchange of audio, video and/ or text between two or more individuals or groups at two or more locations. Trainees attend training programmes in training facilities in which they can communicate with trainers (who are at another location) and other trainees using the telephone or personal computers.

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In the personal-computer-based training the employees participate in training anywhere they have access to a personal computer. This type may involve multimedia training methods such as web based training. Course material and assignments can be distributed using the company’s intranet, video or CDROM. Trainers and trainees interact through email, bulletin boards and conferencing systems. ¾

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A major advantage of distance learning is that the company can save on travel costs. It also allows employees in different locations to receive training from experts who are unable to visit each location. The major disadvantage of distance learning is the lack of interaction between the trainer and the trainees. The positive feature of training, i.e. face-to-face interaction is missing in distance learning which uses the technology to broadcast a lecture to geographically dispersed employees.

Figure 7.8: Teleconferencing

Audiovisual Techniques: Audiovisual instruction includes overheads, slides, and video. ¾

Video is one of the most popular instructional methods.

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Video is used for improving communication skills, interviewing skills and customerservice skills.

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It is usually used in conjunction with lectures to show trainees real-life experiences and examples.

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It is a major component of behaviour modelling.

Advantages of Video: ¾

The trainer can review, slow down or speed up the lesson, which permits flexibility in customizing the session depending on trainees’ expertise.

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Trainees can be exposed to equipment, problems and events that cannot be easily demonstrated (e.g., malfunctioning of equipments, angry customers or emergencies).

Figure 7.9: Training Session Using Audio-visuals

Audiovisual instruction includes overheads, slides, and video.

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¾ Trainees get consistent instruction as programme content is not affected by the interests and objectives of a particular trainer. ¾ Videographing trainees allow them to see and hear their own performance without the interpretation of the trainer. This helps the trainees understand that their poor performance is not due to external evaluators or trainers. Inspite of many advantages, video is plagued by many problems such as too much content for the trainee to learn, poor dialogue between the actors which hampers the credibility and clarity of message, overuse of humour, music or drama that makes it confusing for the trainee to understand the important learning points emphasized in the video. Simulation is a training method which represents a real-life situation, allowing trainees to see the outcomes of their decisions in an artificial environment.

Simulation: It is a training method which represents a real-life situation, allowing trainees to see the outcomes of their decisions in an artificial environment. It is a technique in which trainees learn on the actual or simulated equipment they will use on the job but receive their training off the job. ¾ Simulation aims to obtain the advantages of on-the-job training without actually putting the trainee on job. ¾ Simulation training is a necessity when it is too costly and dangerous to train employees on the job. ¾ Simulations need to have identical elements to those found in the work environment. ¾ Hence, simulators are expensive to develop and need constant updating as new information about the work environment is obtained. ¾ A recent development in simulations is the use of virtual reality technology. Virtual reality is a computer-based technology that provides trainees with a three-dimensional learning experience. Trainees operate in a simulated environment that responds to their behaviours and reactions. ¾ It is a common training method for new assembly-line workers.

Vestibule training is a simulated training which takes place in a separate room with the equipments the trainees will actually use on the job.

¾ For pilots, simulated training may be the only practical alternative. Vestibule Training: It is a simulated training which takes place in a separate room with the equipments the trainees will actually use on the job. Other off-the-job training methods such as self-directed learning, business games and case studies, behaviour modelling, interactive video, e-learning,

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blended learning, learning portals, adventure learning, team training, action learning, group methods and six sigma training are discussed under management development programme. Training for Special Purposes Today, training does more than just prepare employees to perform their jobs efficiently and effectively. Training for special purposes is also the need of the hour. Literacy Training Techniques: Functional illiteracy, that is, the inability to handle basic reading, writing and arithmetic, is a serious problem at shopfloor in many under-developed as well as developing countries. In developed countries also many companies face this problem with immigrant workforce. Teamwork and quality require employees to have a level of analytical skills which is impossible to attain without the ability to adequately read, write and understand numbers. Employers take various steps to teach literacy and other basic skills. In life skills programme employees are grouped into 3 or 4 categories and each category is given separate training. Some companies use their supervisors to teach basic skills through writing and speaking exercises. Another approach is to bring in outside professionals such as school teachers to teach reading and writing. Another option is having the employees attend adult education. Values Training: Nowadays, organizations are aiming at educating employees about the most cherished values and convincing the employees that the organization’s values should be the values of individual employee. Values training is included in the orientation programme. ¾ First two days: Discussion on benefits, safety and security and the production process such as just-in-time delivery, materials management etc. ¾ Third and Fourth days: Values training. The employees are briefed on the vision, mission and value system of the organization which includes teamwork, trust, respect for individuals and quality. Diversity Training: It refers to techniques for creating better cross-cultural sensitivity among supervisors and workers with the aim of creating more harmonious working relationships among the employees. ¾ Consequent to increase in diverse workforce many firms have implemented diversity training.

Training for special purposes include literacy training, values training and diversity training.

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¾ Firms are trying to create a better sensitivity among the supervisors about the issues and challenges women and minorities face in their careers. ¾ Diversity training combines lectures, video and employee roleplaying to emphasize sensitivity to race and religion. ¾ A poorly conceived program can backfire. There are chances for discomfort when stereotypical beliefs are blurted out during ‘awareness raising’ sessions. ¾ To counteract potential problems associated with a diverse workforce, the sessions may concentrate on improving interpersonal skills, understanding/valuing cultural differences, enhancing technical skills, socializing into corporate culture, reducing stress, indoctrinating into the company’s work ethics, mentoring, improving communication/language proficiency etc. Training outcomes are categorized as cognitive outcomes, skill-based outcomes, affective outcomes, results and return on investment.

Step 6. Evaluating Training Programs Examining the outcomes of a training programme helps in evaluating its effectiveness. According to Noe et al (2008), Training outcomes are categorized as cognitive outcomes, skill-based outcomes, affective outcomes, results and return on investment. These are measured as follows: Cognitive Outcomes: Acquisition of knowledge by pencil-and-paper tests and work sample. Skill-based Outcomes: Behaviour and skills by observation, work sample and ratings. Affective Outcomes: Motivation, reaction to programs and attitudes through interviews, focus groups, attitude surveys and observation. Results: Company payoff by data from information system or performance records. Return on Investment: Economic value of training by identification and comparison of costs and benefits of the training programme. Dessler (2008) identified reaction, learning behaviour and results as the important outcomes. Reaction: How did the trainees react to the training programme? Did they like the programme? Did they think it worthwhile?

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Learning: This is to find out to what extent the trainees learned the principles, skills and fads they were supposed to learn. Behaviour: Is there any change in the behaviour of the trainee because of the training? Results: Ultimately what are the results of the training programme? Did the programme achieve all the objectives set forth? Did the number of customer complaints drop? Did the reject rate improve? Did scrappage cost reduce? Was turnover decreased? How much did quality improve? How much it contributed to profits? How much has productivity increased? By how much have costs been reduced? Training managers are under pressure to show the training programmes produce ‘bottom-line’ results. Most organizations measure their training in terms of ROI (Return on Investment). A company’s ROI in training refers to the benefits derived from training relative to the costs incurred. The benefits include higher revenues generated, increased productivity, better quality, lower costs, more satisfied customers, higher job satisfaction and lower employee turnover. The costs include direct costs of the programme such as materials, travel, meeting site, meals, equipment, trainer salary etc. as well as the indirect costs such as participants’ salaries, productivity lost while attending the programme etc. ROI = Results/Costs If the ROI ratio is >1, the benefits of the training exceed the cost of the programme. i.e., the training is effective. If the ROI ratio is 1, the benefits of the training exceed the cost of the programme. i.e. the training is effective. If the ROI ratio is