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    BDS 204 : Human Resource Management


    Intro to Human Resource Management

    2010 Cosmopoint

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    Topic Outlines

    1.1 Definition of Human Resource Management (HRM)

    1.2 Why Study HRM

    1.3 Core Competencies

    1.4 Functions of a HR Manager

    1.5 Management

    1.6 Functions of Management1.7 Is HRM Part of Management?

    1.8 Authority

    1.9 Factors Influencing the Changing HRM

    2.0 Measuring HRs Contribution

    2.1 An Emphasis on Performance

    2.2 HR Metrics2.3 HR Scorecard

    2.4 The High Performance Work System (HPWS)

    2.5 The NEW HR Manager

    2.6 Need to know Employment Law

    2.7 Equal Employment Opportunity (EEO)

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    Topic Outlines

    2.8 Diversity Management

    2.9 Affirmative Action

    3.0 Diversity Management versus Affirmative Action

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    This chapter aims to:

    Chapter Aims

    1. Define human resources management

    2. Understand the importance of human resources as a competitiveadvantage

    3. Illustrate the HR management responsibilities of line and staff (HR)

    managers4. Provide good examples that illustrate HRs role in formulating and

    executing company strategy

    5. Understand the importance of metrics and measurement to HR managers

    6. Explain what is Equal Employment Opportunities, Diversity Managementand Affirmative Action Programs

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    1.1 Definition of Human Resource Management (HRM)

    Process of acquiring, training, appraising

    and compensating employees, andattending to their labor relations, health

    and safety and fairness concerns.


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    1.2 Why Study HRM

    People are the key tobuilding anorganizationscompetitive advantage

    The knowledge, skills

    and abilities of itsemployees are theingredients of theorganizations corecompetencies.




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    1.3 Core Competencies

    Core competencies are the integrated knowledge in an organization that

    distinguish it from its competitors and deliver value to customers

    Organizations can achieve sustained competitive advantage through

    people if they are able to meet the following criteria:

    Resources must be of value

    Resources must be rare

    Resources must be difficult to imitate

    Resources must be organized


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    1.4 Functions of a HR Manager



    Employee &

    Labor Relations

    Safety &



    & Benefit








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    A process where an organization ensures that its existing workforceis sufficient and has the necessary skills to achieve its organizations

    objectives. Staffing involves job analysis, human resource

    planning, recruitment and selection.

    It is vital for an organization to have a workforce that is person-

    organization fit.


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    Human Resource Development

    Purpose of the activities under HRD are: developing and motivating employees

    improving employees productivity and job satisfaction

    achieve the organizations mission and vision

    Activities under HRD are: 1. training and development, 2.individual career planning and development activities, 3.

    organization development and 4. performance appraisal


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    Compensation and Benefits

    A comprehensive compensation system that provides employees with

    sufficient and fair rewards

    Rewards such as pay and benefits

    Pay Benefits - Car Benefits Medical Insurance

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    Safety and Health

    Develop a safe and healthy working environment for employees

    Protect employee from injuries caused by work-related

    accidents and diseases

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    Employee and Labor Relations

    When a labor union represents a firms employees,this human resource activity is known as industrialrelations.

    Collective bargaining will be conducted between theTrade Union and employer on issues such as wages,employees benefits and grievance handling.

    That is

    impossible but

    we are willing

    to offer a 4%

    pay rise

    Trade Union RepEmployers Rep.

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    Human Resource Research

    Major source in revising new HRM policies.

    For instance, research on job safety may

    identify the causes of certain work-related

    accidents in the industry. Therefore, HR cantake steps to avoid such accidents in the



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    Strategic Partner

    Participate in formulating strategies bysupplying information on the companys

    external and internal environment.

    Identify HR practices that would ensure the

    success of the strategy via selecting and

    utilizing the right people and leveraging other



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    1.5 Management

    Process of getting things done, efficiently and

    effectively, through and with other people.

    Efficiency means doing things right at the

    minimum cost Effectiveness means doing the right thing.


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    1.6 Functions of Management

    Planning: Define goals, establish strategies anddevelop plans to implement the strategies andachieve the goals

    Organizing: Determine the tasks, who does them,how they are done, and responsibilities for decisionsand follow-up

    Leading: Motivate employees, direct the activities ofothers, select the most effective communicationchannels, or resolve conflicts among group members

    Controlling: Monitor and compare performance withgoals and address performance shortfalls.


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    1.7 Is HRM Part of Management?

    Management HRM FunctionsPlanning Human Resource Research;

    Strategic Partner; HR


    Organizing Organization structure; HRrelated manuals, job analysis

    Leading Employee and labor relations,

    line manager, compensation &

    benefitsControlling Monitor HR strategies, policies

    and practices on a regular



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    1.8 Authority

    Authority is the right to decide, give orders and direct thework of others

    Two types of authority i.e.

    Line authority is given to line managers who direct thework of the subordinates in order to achieve the

    organizations basic goals Staff authority refers to the authority given to staff

    managers to assist and advise line managers inaccomplishing the organizations basic goals


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    Are All Managers Also HR Managers?


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    Answer: Yes

    The HRM responsibilities of line managers are as

    follows: Placing the right person on the right job

    Starting new employees in the organization(orientation)

    Training employees for jobs that are new to them

    Improving the job performance of each person

    Gaining creative cooperation and developing smoothworking relationships

    Interpreting the companys policies and procedures

    Controlling labor costs Developing the abilities of each person

    Creating and maintaining department morale

    Protecting employees health and physical condition


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    1.9 Factors Influencing the Changing HRM

    Globalization Technological Advances

    Outsourcing Jobs

    Nature of Work Workplace Demographics


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    Definition: Firms expanding their sakes,ownership or

    operations to new markets in other countries

    Effect on HR: Employees need to increase their

    productivity and efficiency. As such, organizationswould need to provide training and development


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    Technological Advances

    The rapid technology advancement has reduced thedemand of unskilled jobs and increased the demand

    for jobs that require considerable skill.

    Effect on HR : Employees require retraining in order to

    handle their new responsibilities and role.


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    Outsourcing Jobs

    Intense competition and the pursuit of lower costs andhigher efficiency have prompted more employers tooutsource their jobs abroad.

    Effect on HR: The HR Department needs tounderstand the culture of other countries and developcompensation, staffing and selection and trainingpolicies to meet the requirements of each country.


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    Nature of Work

    Among the changes to the nature of work due to theever-changing technology are as follows:

    An increase in knowledge-intensive high techmanufacturing industries

    An increase shift of manufacturing jobs to low-wagecountries

    An increase in integrated supply chains

    An increase demand in skilled workers inmanufacturing jobs

    A shift towards part-time workers, independentcontractors, flexi hours working arrangements andjob sharing arrangements


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    Effect on HR :

    There is a high need for knowledge workers and human

    capital. Human capital refers to the knowledge, education,

    training, skills and expertise of a firms workers. This means

    continuous training and development as well as careerplanning for employees.


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    The workforce demographics in Malaysia isbecoming more diverse today as more womenand foreign workers enter the workforce.

    Effect on HR: The HR Department needs to be

    aware of the different needs of their differentemployees. They need to be aware of the latestpolicy in recruiting foreign workers and providesome family-friendly benefits


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    2.0 Measuring HRs Contribution

    Strategy The companys

    long-term plan forhow it will balanceits internal strengths

    and weakness withits externalopportunities andthreats to maintain acompetitiveadvantage




    nce Strateg




    Point APoint B


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    HR mangers today are more involved inpartnering with their top managers in both

    designing and implementing their

    companies strategies Top management wants to see, precisely,

    how the HR managers plans will make

    the company more valuable


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    2.1 An Emphasis on Performance

    Need to increase productivity HR manager needs to adapt their HR

    systems to:

    suit the organizations strategic needs manage these changes effectively


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    2.2 HR Metrics

    A set of quantitative HR performancemeasures

    Examples include: Workerscompensation cost per employee,

    turnover rate, turnover costs, etc. Top management expects moreforward-looking information such as

    How will the new incentive

    compensation plan assist theorganization in improving the profitabilityof the organization?.


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    2.3 HR Scorecard

    The HR Scorecard measures the HRfunctions effectiveness and efficiency in

    producing employee behaviors needed

    to achieve the organizations strategicgoals.


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    The HR Scorecards answers two


    Do HR policies and practices create

    value to an organization?

    Does it help the organization in achieving

    its objectives?


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    Service levels and process measures such as

    cost per recruit, number of learning plans

    implemented and number of projects completed

    are used to measure employees performance. These measures will be used to gauge and

    measure their employees more effectively.


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    2.4 The High Performance Work System (HPWS)

    Its main purpose is to maximize the competenciesand abilities of all employees in the organization,thus, achieving the following:

    Generate more job applicants

    Employee screening is more effective Better training

    Linking pay more explicitly to performance

    Safer and healthier working environment


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    2.5 The NEW HR Manager

    The HR manager today needs to be proficient inthe following areas:

    Leadership Proficiencies

    Learning Proficiencies

    HR Proficiencies

    Business Proficiencies


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    2.6 Need to know Employment Law

    Types of HR-related Law in Malaysia are asfollows:

    Employment Act 1955

    Industrial Relations Act 1967

    Trade Unions Act 1959Occupational Health and Safety Act 1994

    Immigration Act

    Employees Provident Fund Act 1991

    Human Resources Development Act 1992Ethics Law such as Sarbanes-Oxley Act 2003


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    2.7 Equal Employment Opportunity (EEO)

    Equal employment opportunity (EEO) refersto the fair and nonbiased treatment ofindividuals in all aspect of employmentregardless of age, gender, colour, national

    origin and race. This means practicing workplace rules,

    policies, practices and behaviors that do notdiscriminate people.


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    2.8 Diversity Management

    Diversity management focuses on managingthe difference within an organizations

    workforce, capitalizing on the benefits of

    diversity and minimizing on workplace



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    Provide Strong Leadership Assess the Situation

    Provide Diversity Training andEducation to Employees

    Change Culture and ManagementSystems.

    Evaluate the Diversity Management


    Organizational activities that would ensure the success of these programs:


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    2.9 AffirmativeAction

    Affirmative action aims at eliminating thecurrent effects of past discrimination byhiring and promoting the minority group

    Steps taken by employers are: Issue a written EEO policy and astatement indicating the employerscommitment to affirmative action

    Appoint a top official to direct andimplement the program


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    Publicize the policy and affirmative action commitment

    Conduct a survey on the present minority and female employees todetermine their suitability for promotion

    Establish goals and timetables to improve the utilization of minorities,males and females in each identified area

    Develop and implement specific programs to achieve these goals

    Develop an internal audit and reporting system for monitoring andevaluating the progress of the programs

    Build support for the program both internally and externally


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    3.0 Diversity Management versus Affirmative Action

    DiversityManagement Affirmative ActionVoluntary Mandatory

    Focuses onproductivity,

    efficiency and


    Focuses on legal,social and moral


    Includes allelements of


    Includes only race,gender and



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    Diversity Management versus Affirmative Action

    Diversity Management Affirmative


    Emphasizes changing

    systems and operation

    Emphasizes changing the

    mix of people

    Offers a perception of equity Offers a perception of


    Long-term and ongoing Short-term and limited

    Is grounded in individuality Is grounded in assimilation