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Human Resource Management

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Human Resource Management (MGT501)
Lesson 13
After studying this chapter, students should be able to understand the following concepts:
Strategic Planning
Human Resource Information Systems (HRIS)
Relationship of HRIS with overall MIS
A. Strategic planning:
It is the process by which top management determines overall organizational purposes and
objectives and how they are to be achieved. The linking of HRM with strategic goals and objectives
in order to improve business performance and develop organizational cultures that foster
innovation and flexibility." The role of HR in the strategic planning process depends on the
organization's view of HR. There are three views detailed in the text which involve HR as an
operational function, HR as a "fitting" function, and HR as an equal partner in the strategic
planning process. Obviously, it is our contention that the latter is the appropriate view. In this
view, HR's role would include environmental scanning, competitive intelligence, internal strengths
and weaknesses analysis, and the implementation of the strategies. HR process involves following
activities or steps.
I. HR Planning Process:
a. Determine the organizational mission:
It states Organization's overall purpose and basic business scope and operations it provides
information like, why does our organization exist? What unique contributions can it make?
b. Scan the organizational environment.
This is also known as SWOT analysis through this process organizations identify different
opportunities available in the market and the threats that can be faced by the organization,
and the weaknesses and strengths possessed by organizations are also measured and
identified through this process.
c. Set strategic goals:
To achieve the overall mission or purpose of the organization it is required to set specific
long-term and short term objectives and goals. The goal can be defined as desired
outcomes to accomplish mission. Following are the characteristics of effective goals.
d. Formulate a strategic plan:
Courses of action is designed to meet strategic goals, also specifies functional or
departmental goals are selected at this step.
II. Strategic Planning and Strategic Trends
a.  The Basics of Strategic Planning ­ A strategy is the company's plan for how it will balance
its internal strengths and weaknesses with its external opportunities and threats and
maintain a competitive advantage. Managers engage in three levels of strategic planning:
corporate-level strategy, business-level competitive strategy, and functional strategies.
b. The Strategic Planning Process entails conducting a SWOT analysis to identify its
strengths, weaknesses, opportunities, and threats.
Basic Strategic Trends
Globalization refers to the tendency of firms to extend their sales,
ownership, and/or manufacturing to new markets abroad.  For
Human Resource Management (MGT501)
businesses everywhere, the rate of globalization in the past decade has
been enormous, and has several strategic implications for firms.
Technological Advances have been forcing, and enabling, firms to
become more competitive.
The Nature of Work is changing due to new technological demands.
The Workforce demographics are changing as well. It's becoming
more diverse as women, minority-group members, and older workers
enter the workforce.
d. Managerial Consequences of the Basic Trends ­ Managers have to craft strategies that
balance opportunities and threats (like those previously discussed) with their firm's
strengths and weaknesses, such as global expansion and improved competitiveness
strategies. These types of strategies are driving other organizational changes.
III. HR's Strategic Role
HR's Evolving Role ­ It's the firm's workforce that provides the
competitive advantage for the firm.  HR's role is shifting from
protector and screener to strategic partner and change agent.
b. Strategic Human Resource Management refers to improving business
performance and developing an organizational culture that fosters
innovation and flexibility by linking HRM with the strategic goals and
objectives of the firm.
HR's Role As a Strategic Partner can be seen as either adapting
individual HR practices to fit specific corporate and competitive
strategies or as an equal partner in the strategic planning process.
HR's Role in Executing Strategy ­ Execution has been HR's traditional
strategic role.
HR and Value Chain Analysis ­ Strategy execution usually involves identifying
and reducing costs, and therefore value chain analysis.
HR's Role in Formulating Strategy ­ HR management can play a role in
environmental scanning by assisting in identifying and analyzing external
opportunities and threats that may be crucial to the company's success.
B. Human Resource Information System
HRISs are systems used to collect, record, and store, analyze, and retrieve data concerning an
resources. The collection of
information on aspects of
work life as diverse as salary  M anag er
M anag em en t Inform ation S ystem
and  payroll,  compensation,
De veloping inform ation
accidents,  An aly sis
Managem ent
superannuating and employee
inform ation
benefits has always been part  P lann ing
of  the  human  resource   Leading
M anagem ent
manager's function. In the
early  history  of  personnel
inform ation
M anag em en t decisions and com m unication
collection, took up a great deal
of time. Reviews of employee
Human Resource Management (MGT501)
salary and leave entitlements often dominated the activities of earlier personnel officers, reflecting
both management priorities and their own clerical backgrounds.
Such early information systems were manual, and were mainly used to notify employees of leave
entitlements, to ensure accurate salary and wage payments and to process workers' compensation
and superannuating claims. The data was seldom used to predict trends, identify problem areas and,
or aid in the longer-term staffing process.
I. The development of human resource information systems (HRIS)
In the early development of human resource management, information systems, although often
accurate and comprehensive, were mainly used for administrative and operational purposes. Forms
were used to collect leave requests, workers compensation and accident data, and salary variation
and superannuation entitlements. During the 1970s and 1980s, several factors radically changed
attitudes towards human resource information systems. The increasing complexity of payroll
systems in this period demanded more flexibility in, and access to information system. These needs
happily coincided' with the development of increasingly sophisticated computer hardware and
software systems. In large organizations, centralized payroll processing sections began to be
separated from other human resource functions. Some organizations contracted their payroll
responsibilities to external payroll bureaus with greater technological expertise, and for reduced
II. Nature and benefits of HRIS
Modern human resource information systems are comprehensive, accurate and accessible systems
for recording employee and work data relevant to HRM, HR and organizational planning.
An HRIS is:
The system used to acquire, store. Manipulate, analyze, retrieve and distribute pertinent information
regarding an organization's human resources. Its purpose is to facilitate, or support, straight, tactical
and operational decision making, to avoid litigation, to evaluate programs, policies, or practice and
daily operations
Specific benefits of such systems include:
Improved planning and program development using decision support software. Faster
information processing and improved response times
Decreased administrative and HR costs
Accuracy of information
Enhanced Communication at all levels.
Not all systems fulfill all these requirements, nor is such a complete system suitable for all
organizations. Essentially however all HRIS contain information on:
 Jobs and work conditions
 HR events (e.g. recruitment. training and development, performance appraisals, and
III. Uses of HRIS
Comprehensive and integrated information systems can be used widely -in administrative, operational and
strategic fields by HR and other managers. On the operational level HRIS data can be used to identify
potential internal applicants for job vacancies, saying external recruitment costs and assuring employees of
career opportunities. Strategically, such information may be used to gauge the effectiveness of current
recruitment or promotional systems, their costs and/ or benefits, and enable subsequent changes of direction
in line with proposed organizational strategies.
IV. Strategic HR planning and HR information systems
Proactive HR managers ensure that their HRIS contributes to organizational performance. A recent
development in the uses of HRIS in many has been the linking of 'benchmarking' practices to the design,
choice and implementation of such systems as a directly strategic initiative. Integration with organizational
Human Resource Management (MGT501)
strategic objectives is achieved by the subsequent establishment of performance targets and quantitative
measures. As a strategic 'tool', HRIS can be used to contribute to the development and modification of HR
plans, on both quantitative and  qualitative bases, and to feed into specific HRM functions. HR data, if
collected effectively and contained within computerized, accessible systems, can both compare
organizational HR 'bottom line' outcomes by HRM function, between functions and with national or
international performance benchmark
V. HRIS Applications
A computerized HRIS contains hardware and software applications that work together to help managers
make HR decisions. HRIS software applications currently available to business include those for employee
information, applicant tracking, skills inventory, payroll, and benefits administration.
VI. HRIS Security and Privacy
The HR department must develop policies and guidelines to protect the integrity and security of the HRIS
so that private employee information does not fall into the wrong hands. To maintain the security and
privacy of HRIS records, companies should control access, develop policies and guidelines that govern the
utilization of information, and allow employees to check their records.
VII. Purposes of HRIS
All organizations and their HR mangers need to consider whether their HRIS will be primarily used for
collecting, analyzing, interpreting or reporting employee information. The nature of the system chosen
should reflect this primary purpose, based upon a realistic analysis of needs prior to its introduction.
Small organizations with stable workforces and secure markets do not require complicated data analysis, but
can benefit from comprehensive and accurate databases for reporting purposes. On the other hand, large
organizations in competitive and dynamic industries demand strategic HRIS. Every organization needs to
assess its particular needs and identify the most appropriate information system for its chosen purposes.
VIII. Common HRIS Functions
Mainly following functions are performed by the HRIS in different organizations.
 Job analysis information can be placed in the HRIS.
 The program can write job descriptions and job specifications.
 Constant monitoring of compliance with EEO legislation.
 Maintain records of rejected applicants.
 Saves money and time in compiling reports.
 Ensure that women and minorities or not be adversely affected.
 Track minority hiring, recruitment, and advancement.
 Forecast supply and demand of labor from both the internal and external labor markets.
 Useful for internal recruiting.
 Can post job opening for employees to access.
 Can search for match between job specifications and applicant qualification.
 Applicant tracking system.
 Administering and scoring ability tests.
 Scanning resumes submitted online (web based or e-mail) or in person (or mail).
 Structured interviews.
 Matching qualifications with open positions (finding a good fit).
 Also, consider budgetary concerns.
 Help with registration, tracking training, monitor training costs, and schedule training.
 Used to deliver training.
 Career and managerial succession planning.
 Used to provide assessment tests to help employee's plan their own career.
 Predict career paths.
 Provide PA instruments and results.
Human Resource Management (MGT501)
Comparisons between employees, groups, or supervisors ratings.
Monitor attendance.
Monitor compliance with Labor Standards.
Individual sale data can be accessed (tracking commissions).
Benefits can be managed and administered by computers.
Planned raises and wage histories.
Provides reports for Occupational Safety and Health Administration (OSHA).
Track hazardous materials.
Track accidents and costs of accidents.
Record employee safety training.
Record employee exposure to various conditions and chemicals.
Track disciplinary actions and grievances.
Labor contract data.
Worker seniority list. Etc..
C. Relationship of HRIS with overall MIS
Information is the backbone of healthy and efficient business management. An information system allows
the collection and processing of data to produce useful information for designated users at each level of
management. Information management must conform to well-defined principles, run on appropriate
software, and be completely adapted to your organization within an integrated system usually known as
Management Information System (MIS). Management Information System is the entire set of systems and
activities required to manage, process, and use information as a resource in the organization. Stated slightly
differently, MIS is the management and use of computer-based systems, computer-resident data, and
telecommunications for the support of business decision processes. HRIS is the part of MIS that provides
the information regarding workforce in the organization and facilitates the decision makers in decision
making process in this regard.
Key Terms
Strategic planning: It is the process by which top management determines overall organizational purposes
and objectives and how they are to be achieved.
Human Resource Information System: HRISs are systems used to collect, record, and store, analyze, and
retrieve data concerning an organization's human resources.
Table of Contents:
  1. INTRODUCTION TO HRM:Growing Importance of HRM, Road Map of the Course
  2. ESSENTIALS OF MANAGEMENT:Concepts and Essential of Management, Managerís Roles
  3. ORGANIZATION AND COMPONENTS OF ORGANIZATION:Open versus Closed Systems, The Hawthorne Studies
  4. PEOPLE AND THEIR BEHAVIOR:Why to work in organizations?, The Goals of Organizational Behavior
  5. INDIVIDUAL VS. GROUP BEHAVIOR:What Are Roles?, Problem solving Team
  6. PERSONNEL MANAGEMENT TO HUMAN RESOURCE MANAGEMENT:Records and Administration, Competitive Advantage
  7. HRM IN A CHANGING ENVIRONMENT:Productivity, New Trends at Work Place
  8. How organization Cultivate a Diverse Workforce, STEPS TOWARD MANAGEMENT OF DIVERSITY
  9. FUNCTIONS AND ENVIRONMENT OF HRM:Compensation and Benefits, Safety And Health, Interrelationships of HRM Functions
  10. LINE AND STAFF ASPECTS OF HRM:Authority, Line versus Staff Authority, Staff Manager
  11. LEGAL CONTEXT OF HR DECISIONS:Doing the Right Thing, Affirmative Action, Unintended Consequences
  12. HUMAN RESOURCE PLANNING (HRP):Benefits of HR Planning, Forecasting Human Resource Availability
  13. STRATEGIC PLANNING AND HRIS:HRís Strategic Role, Human Resource Information System, Common HRIS Functions
  14. JOB ANALYSIS:Purposes of the job Analysis, Questions Job Analysis Should Answer
  15. JOB ANALYSIS:Methods of Collecting Job Analysis Information, Observation, Source of Data
  16. JOB ANALYSIS (CONTD.):SURPLUS OF EMPLOYEES FORECASTED, Diversity through Recruiting Efforts
  17. SOURCES OF RECRUITMENT:ALTERNATIVES TO RECRUITMENT, Quantity of the Applicants, Quality of the Applicants
  18. SELECTION:Initial Screening, Advantages of Successful Screening
  19. SELECTION TESTS:Characteristics of Properly Designed Selection Tests, Guidelines for Conducting an Interview
  20. SELECTION PROCESSÖ CONTD:Background Investigations, Physical Exam, Selecting Managers
  21. SOCIALIZATION:Compensation and Benefits, Team Membership, Stages in socialization Process, Training and Development Trends
  22. TRAINING AND DEVELOPMENT:Learning, Phases of Training, Why Transfer of Training Fails
  23. MAXIMIZING LEARNING:Following up on Training, Repetition, Feedback, Purposes of T & D
  24. CAREER MANAGEMENT:Individual career planning, Career Planning and Development Methods
  25. PERFORMANCE:Determinants of Job Performance, Why is performance measured?, Performance Management
  28. COMPENSATION SYSTEM:Pay, Job Pricing, Compensation: An Overview, Compensation Surveys
  29. BENEFITS:Total Compensation, Discretionary Benefits (Voluntary), Workplace Flexibility
  30. ROLE OF MONEY IN PERFORMANCE OF EMPLOYEES:Types of Pay-for-Performance Plans, Empower Employees
  31. MOTIVATION:The Motivation Process, Motivational Theories, Challenges of motivating employees
  32. OCCUPATION, HEALTH & SAFETY:Physical Conditions, Accident Investigation, Smoking in The work place
  33. STRESS MANAGEMENT:Symptoms of Stress, Managing Stress,
  34. COMMUNICATION IN ORGANIZATION:Burnout, Social Support at Work & Home, Communication in organization, Meetings
  35. TRADE UNIONS:Collective Bargaining, The HRM Department in a Nonunion Setting, Phases of Labor Relations
  36. CONFLICT AND NEGOTIATION:Transitions in Conflict Thought, Individual Conflict Management Styles
  37. POWER AND POLITICS:Sources of Power, Advantages and Disadvantages of PowerPower and Politics in Context
  38. EMPLOYEE RIGHTS AND DISCIPLINE:Contractual Rights, Management Rights, Disciplining Employees,
  39. DISCIPLINE (CONT...):Factors to Consider when Disciplining, Disciplinary Guidelines, Employee Separations
  40. LEADERSHIP:The Leaderís Behavior, Situational Theories of Leadership, Becoming a Leader
  41. REVISION (LESSON 12-21):Plans, Job Specification, Human resource planning, Selection Process, Corporate Culture
  42. REVISION (LESSON 22-26):Training, Case Study Method, Training, Performance
  43. REVISION (LESSON 27-35):Classification Method, Compensation, Empowerment, Mediation
  44. INTERNATIONAL DIMENSIONS OF HRM:Global Corporation, Type of staff members, Approaches to Global Staffing
  45. CONCLUSION & REVIEW:Strategies for Gaining Competitive Advantage, High-performance Work System