Business Management and Strategy PHR 11% - SPHR 30%
Discussion Question: How do human resource functions contribute to the strategic alignment of a company?
Major HR Functions • Staffing • Performance evaluations • Compensation and benefits • Training and development • Employee relations • Safety, health, & security • HR research
Strategic Alignment • Identifies business • - Provides guidance Corporate Strategy • Identifies competitive advantage • Provides a plan Business Unit Strategy R&D Strategy Operations Strategy Sales/Marketing Strategy HR Strategy - Functional units’ strategies should align with business strategy
HR Practices Organizational Capabilities Business Strategy Organizational Capabilities Organizational capabilities allow a firm to implement its business strategy.
HR Policies Guide Actions of an Organization toward the achievement of its objectives
Discussion Question: How do human resource policies differ from human resource objectives? What is the value of such policies and why should they be written?
HR Policies Serve Three Major Purposes • Reassure employees they will be treated fairly and objectively. • Help managers make rapid and consistent decisions. • Give managers confidence to resolve problems and defend decisions.
Employee Handbooks • What is the purpose of an Employee Handbook? • What topics are typically found in an Employee Handbook?
HR Positions by Size of Organization • 60-80 Employees = No HR position • 100-200 Employees = 1 HR position • 200+ Employees = HR Manager + specialists
An Organization Chart for a Company Organized by Function President Finance Legal HR R & D PR Purchasing Sales Manufacturing Product A Product B Product A Product B
Vice President of Human Resources Employment Manager Human Resources Planning Manager Compensation Manager Benefits & Services Manager Training & Development Manager Labor Relations Manager Risk Management Manager Equal Employment Manager An Organization Chart Showing the HR Dept
Discussion Question: How much authority should the human resource department have over line managers? Which issues and activities call for the human resource department to serve in an advisory role, which in a service role, and which in a control role?
HR Competencies Skills and abilities all HR managers need to possess to be successful.
Organizational Strategy HR managers serve as strategic partners with other corporate executives in executing strategy.
Vision Product or service the company ought to provide.
Discussion Question: What is the relationship between a generic strategy and the mission of an organization? How are mission statements formed and how are they beneficial?
Mission Statements What elements are usually found in mission statements?
Three Grand Strategies What are the three grand strategies identified by Michael Porter?
Managers seek to formulate strategies that align internal organizational characteristics & external environment.
Strategy Formulation • Selecting the right competitive strategy is vital to a firm’s success. • How are strategies formulated?
Identify the Organization’s Mission & Objectives Analyze Environment: Opportunities & Threats Analyze Resources: Strengths & Weaknesses Formulate Strategy Implement Strategy Evaluate and Monitor Results Strategic Management Process (SWOT Method)
Writing a Business Plan How the company plans to compete successfully within it’s industry.
Aligning the Organization Good strategies depend on good alignment and implementation
Vision/Mission Strategy Feedback Systems Structure Processes Culture ORGANIZATION Designing Effective Organizations
Resource-based Theory of the Firm Control of resources that are rare, nontradable, nonsubstitutable, valued by the market, and difficult or impossible to imitate.
Potential Entrants Rival Firms Suppliers Buyers Substitute Products Five Forces Model of Competition
Competitor Analysis • future objectives • current strategy • assumptions • capabilities
HR Control & Evaluation
HR Budgeting Process A budget is an itemized estimate of the operating results of a company for a future time period.
Discussion Question: If a human resource manager was required to do an elaborate cost-benefit analysis of the department, what kinds of items should he or she list under costs? What should the manager list under benefits?
Step 1: Define responsibilities of HR Dept Step 2: Collect data Step 6: Implementation & follow-up Step 3: Analyze results Step 4: Data feedback and evaluation Step 5: Develop an action plan Human Resource Audit
Discussion Question: What is the value of human resource accounting measures? How could this information help managers or investors make better decisions?
Measures of HR Accounting • Outlay cost • Replacement cost • Human resource value
Key Performance Indicators Organizations need HR metrics that measure both efficiency (time & cost) and effectiveness (ROI & profitability). What are some of the most common performance indicators?
HR Practices & Business Performance HR activities are expected to contribute to a firm’s profitability.
Balanced Scorecard Analyzing the traditional HR measures concurrently with performance metrics.
Outsourcing • Outsourcing can be a cost-effective method for companies to operate. • What are the benefits of outsourcing HR functions?