Chapter 7
Human Resources Management: the strategic approach to the effective management of an
organization’s workers so that they help achieve its objectives and gain a competitive
advantage.
Functions of HR:
- Human resource planning
- Talent management
- Training and development of employees
- Reward and performance management
- Employee relations
- Employee welfare
- Human resource compliance
Human resource planning: analyzing and forecasting the numbers of workers and the skills of
those workers that will be required by the organization to achieve its objectives.
Workforce plan: numbers of workers and skills of those workers required over a future period.
Workforce audit: checks on the skills and qualifications of all existing employees.
Labor turnover: measures the rate at which employees are leaving an organization
Internal Factors External Factors
Demographic Change Flexi-time
The potential supply of labor to any organization is affected by A flexible way of working that allows employees to fit
demographic changes. their working hours around their individual needs to
allow for other commitments outside of work.
Changes in labor mobility Gig economy
High occupational mobility of labor: the extent to which A labor market characterized by the widespread use
workers are willing and able to move to different jobs requiring of short-term contracts or freelance work rather than
different skills. jobs with permanent contracts.
Geographical mobility of labor: the extent to which workers are
willing and able to move geographically to take up new jobs.
Resistance to change in the workforce:
- Fear of the unknown
- Fear of failure
- Self-interest – losing something of value
- Misinformation – false beliefs about the need for change
- Low tolerance – lack of trust
- Inertia – reluctance to change
Change management: planning, implementing, controlling, and reviewing the movement of an
organization from its current state to a new one.
, Causes of Change
Nature of Change Managing Change
Technological innovation: leading to - Need for employee retraining
new products and new processes. - Purchase of new equipment
- Need for quicker product development
Macroeconomic changes: fiscal policy, - Need for flexible production systems
interest rates, fluctuations in the business - Training should be offered to allow multi-skills to be learned
cycle. - Explain the need for extra capacity or the need to rationalize
- Deal with workforce cutbacks in a way that encourages employees
who remain to accept change
Takeover by another business - Inform employees of reasons for the takeover
- Reassure employees
- Meeting with the new management team to discuss its plans
- Training and guidance on new corporate culture
- Financial assistance for relocation, if necessary
Project champion: a person assigned to support and drive a project forward and who explains
the benefits of the change and assists and supports the team in putting change into practice.
Project group: these are created by an organization to address a problem that requires input
from different specialists.
Chapter 8
Organizational structure: a sense of formal structure.
Types of Organizational Structure
Name Description Advantages Disadvantages
Passing authority - Gives senior managers more time to - High possibility for it to be
down the focus on important, strategic roles inefficient
organizational - Shows trust in subordinates - Unsuccessful if insufficient
hierarchy. (motivation) authority is given to the
- Trains employees for more senior subordinate who is
positions performing the tasks
Delegation - Helps employees achieve fulfillment - Managers may only
- Encourages employees to be delegate the boring jobs (not
accountable for their work-based motivating)
activities - Delegation requires
managers to exercise less
control over the work
subordinates and some find
this difficult to accept
, An organizational
structure with
Bureaucracy standardized
procedures and
standards.
Keeping all of the - A fixed set of rules and procedures in
important decision- all areas of the firm should lead to
making powers within rapid decision-making
the head officer or the - The business has consistent policies
Centralization center of the throughout the organization (prevents
organization. conflicts)
- Senior managers make decisions in
the interest of the whole business
- Central buying should allow for
greater economies of scale
- Senior managers at head office will
be experienced decision-makers
Decision-making - More local decisions can be made
powers are passed which reflect different conditions
down the organization - More junior managers can develop
Decentralization to empower skills and this prepares them for more
subordinates and challenging roles
regional/product - Delegation and empowerment are
managers. made easier
Removal of one or - Reduces business costs - Could be one-off costs of
more of the levels of - Shortens the chain of command and making managers redundant
hierarchy from an should improve communication - Increased workloads for
organizational - Increases spans of control and managers who remain
Delayering structure. opportunities for delegation (overworked, and stressed)
- May increase workforce motivation - Fear that redundancies
due to less remoteness from top might be used to cut costs
management and increased chances could reduce the sense of
of having more responsibilities security of the whole
workforce
Creates project teams - Allows total communication between - There is less direct control
from across traditional all members of the team from the top
functional - Less chance of people focusing on - Reduced bureaucratic
departments. just what is good for their department control, may be rejected by
Matrix structure - The crossover of ideas between managers
people with specialist knowledge in - Conflicts of interest
different areas tends to create more between project leaders.
successful solutions
- Created quickly, this system is well-
designed to respond to changing
markets and technology
Human Resources Management: the strategic approach to the effective management of an
organization’s workers so that they help achieve its objectives and gain a competitive
advantage.
Functions of HR:
- Human resource planning
- Talent management
- Training and development of employees
- Reward and performance management
- Employee relations
- Employee welfare
- Human resource compliance
Human resource planning: analyzing and forecasting the numbers of workers and the skills of
those workers that will be required by the organization to achieve its objectives.
Workforce plan: numbers of workers and skills of those workers required over a future period.
Workforce audit: checks on the skills and qualifications of all existing employees.
Labor turnover: measures the rate at which employees are leaving an organization
Internal Factors External Factors
Demographic Change Flexi-time
The potential supply of labor to any organization is affected by A flexible way of working that allows employees to fit
demographic changes. their working hours around their individual needs to
allow for other commitments outside of work.
Changes in labor mobility Gig economy
High occupational mobility of labor: the extent to which A labor market characterized by the widespread use
workers are willing and able to move to different jobs requiring of short-term contracts or freelance work rather than
different skills. jobs with permanent contracts.
Geographical mobility of labor: the extent to which workers are
willing and able to move geographically to take up new jobs.
Resistance to change in the workforce:
- Fear of the unknown
- Fear of failure
- Self-interest – losing something of value
- Misinformation – false beliefs about the need for change
- Low tolerance – lack of trust
- Inertia – reluctance to change
Change management: planning, implementing, controlling, and reviewing the movement of an
organization from its current state to a new one.
, Causes of Change
Nature of Change Managing Change
Technological innovation: leading to - Need for employee retraining
new products and new processes. - Purchase of new equipment
- Need for quicker product development
Macroeconomic changes: fiscal policy, - Need for flexible production systems
interest rates, fluctuations in the business - Training should be offered to allow multi-skills to be learned
cycle. - Explain the need for extra capacity or the need to rationalize
- Deal with workforce cutbacks in a way that encourages employees
who remain to accept change
Takeover by another business - Inform employees of reasons for the takeover
- Reassure employees
- Meeting with the new management team to discuss its plans
- Training and guidance on new corporate culture
- Financial assistance for relocation, if necessary
Project champion: a person assigned to support and drive a project forward and who explains
the benefits of the change and assists and supports the team in putting change into practice.
Project group: these are created by an organization to address a problem that requires input
from different specialists.
Chapter 8
Organizational structure: a sense of formal structure.
Types of Organizational Structure
Name Description Advantages Disadvantages
Passing authority - Gives senior managers more time to - High possibility for it to be
down the focus on important, strategic roles inefficient
organizational - Shows trust in subordinates - Unsuccessful if insufficient
hierarchy. (motivation) authority is given to the
- Trains employees for more senior subordinate who is
positions performing the tasks
Delegation - Helps employees achieve fulfillment - Managers may only
- Encourages employees to be delegate the boring jobs (not
accountable for their work-based motivating)
activities - Delegation requires
managers to exercise less
control over the work
subordinates and some find
this difficult to accept
, An organizational
structure with
Bureaucracy standardized
procedures and
standards.
Keeping all of the - A fixed set of rules and procedures in
important decision- all areas of the firm should lead to
making powers within rapid decision-making
the head officer or the - The business has consistent policies
Centralization center of the throughout the organization (prevents
organization. conflicts)
- Senior managers make decisions in
the interest of the whole business
- Central buying should allow for
greater economies of scale
- Senior managers at head office will
be experienced decision-makers
Decision-making - More local decisions can be made
powers are passed which reflect different conditions
down the organization - More junior managers can develop
Decentralization to empower skills and this prepares them for more
subordinates and challenging roles
regional/product - Delegation and empowerment are
managers. made easier
Removal of one or - Reduces business costs - Could be one-off costs of
more of the levels of - Shortens the chain of command and making managers redundant
hierarchy from an should improve communication - Increased workloads for
organizational - Increases spans of control and managers who remain
Delayering structure. opportunities for delegation (overworked, and stressed)
- May increase workforce motivation - Fear that redundancies
due to less remoteness from top might be used to cut costs
management and increased chances could reduce the sense of
of having more responsibilities security of the whole
workforce
Creates project teams - Allows total communication between - There is less direct control
from across traditional all members of the team from the top
functional - Less chance of people focusing on - Reduced bureaucratic
departments. just what is good for their department control, may be rejected by
Matrix structure - The crossover of ideas between managers
people with specialist knowledge in - Conflicts of interest
different areas tends to create more between project leaders.
successful solutions
- Created quickly, this system is well-
designed to respond to changing
markets and technology
