HR Management & Leadership: MBA Essentials
By Harald Meier
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About this ebook
In this book, the essential basics of modern HR Management and Leadership are presented systematically and always with practical examples.
The focus is on the scope of action as a manager responsible on any hierarchical and process level or in HR Management. Step-by-step, to understand HR Management and Leadership policy, strategies and concepts as well as for current challenges in International Management, in 4.0 and in Social Business.
The target group are graduates and specialists who are systematically preparing for a new management position (e.g. in a General Management or MBA program), consultants, management trainer and lecturers.
Harald Meier
Professor Harald Meier, studies in Business Administration and Economics and PhD, University of Applied Sciences Bonn-Rhein-Sieg, after commercial vocational training working in banks, consulting, further education and NGOs in Germany and abroad, founder of the International Institute for Training Quality Certification (IfTQ-Cert) and working for certification agencies in the academic and professional educational sector world-wide.
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Book preview
HR Management & Leadership - Harald Meier
Edition Management Essentials
by IfTQ-Cert
International Institute for Training Quality Certification
Bonn/Germany (www.iftq-cert.de)
Vol. 1 Business Management (2020)
Vol. 2 HR Management and Leadership (2021)
Vol. 3 Entrepreneurship (2021/2022)
Vol. 4 Social Business (in prep.)
Vol. 5 Intercultural Management (in prep.)
Vol. 6 Intercultural Project Management (in prep.)
Edition Management Essentials
by IfTQ-Cert
International Institute for Training Quality Certification
Preface
Organisations, whether private or public, profit or non-profit oriented, need human resources and managers to accomplish the corporate strategies and operational tasks. Mostly, managers are having a specific professional expertise and work experience, when they apply or being promoted for their first leadership function. And they need to understand HR Management, which is creating and controlling the leadership tools. The basics of modern HR Management and Leadership are introduced systematically and easily understandable.
Parallel and step-by-step structured, this manual leads from the corporate policy and strategies and external socio-economic trends to day-by-day HR Management organisation and operations and Leadership situations and behaviour including the basic common theories and always with examples from practises. Also, HR Management and Leadership specifics are reflected in International Management and Diversity, in Industry 4.0 and Artificial Intelligence, and in CSR, Social Businesses and NGOs.
This book is based on the author's own experience in managing teams and organisations, in HR management and consulting as well as on conception and lectures in MBA programs worldwide. The target group is for example, lecturers and management trainer and consultants, young managers and specialists from other fields of expertise who are preparing for a management position e.g. with a degree in General Management or an MBA.
Bonn, January 2021
Since English is the first or second official language with its own expressions and spellings in more than 80 countries, no uniform spelling is considered.
Numbers are in German style: 1.000.000 is for e.g. 1,000,000 for US/UK.
Coming together is a beginning;
staying together is progress;
working together is success.
Henry Ford, 1863-1947
Brief Contents
Preface
HR Management Policy and Strategy
1.1 HR Management Policy
1.2 Concepts and Instruments of HR Policy
Leadership
2.1 Organisational Psychology and Leadership
2.2 Operational Leadership Instruments
2.3 Leadership Development
HR-Organisation and Operations
3.1 HR Management Organisation
3.2 HR Management Operations
3.3 HR Controlling
Challenges in HR Management and Leadership
4.1 International HR, Leadership and Diversity
4.2 HR Management and Leadership in Industry 4.0
4.3 Social Business HR Management and Leadership
Contents
Preface
Figures
Abbreviations
HR Management Policy and Strategy
1.1 HR Management Policy
1.1.1 Corporate Policy and HR Management
1.1.2 Governance, Compliance and Co-determination
1.1.3 HR and Leadership related Megatrends
1.1.4 Strategic HR and Human Capital Management
1.2 Concepts and Instruments of HR Policy
1.2.1 HR and Leadership Guidelines
1.2.2 Employee Relations, HR Research and Survey
1.2.3 Works Agreement
1.2.4 Employer Branding
1.2.5 Annual HR Report and Staff Meeting
1.2.6 Change Management
Leadership
2.1 Organisational Psychology and Leadership
2.1.1 Organisational Theory, Behaviourism and Work
2.1.2 Motivational Theory
2.1.3 Leadership Roles
2.1.4 Leadership Theory
2.1.5 Leadership Styles
2.2 Operational Leadership Instruments
2.2.1 HR Policy related Leadership instruments
2.2.2 Personnel Planning, Job Profile and Staff Selection
2.2.3 Work Introduction and Onboarding
2.2.4 Staff Dialogue and Team Meeting
2.2.5 Employee Evaluation Report
2.2.6 Team Development
2.3 Leadership Development
2.3.1 Action Maze: Leadership case
2.3.2 Management Development
HR-Organisation and Operations
3.1 HR Organisation
3.1.1 Organisational Theory and HR Management
3.1.2 HR Management Organisation
3.2 HR Management Operations
3.2.1 Personnel Planning Scheme
3.2.2 HR Marketing and Recruitment
3.2.3 Onboarding and Retention Management
3.2.4 Training and Development
3.2.5 Personnel Downsizing
3.2.6 HR Administration and Feelgood Management
3.3 HR Controlling
3.3.1 HR Information System
3.3.2 Personnel Costs, Budgeting and Index Analysis
3.3.3 Personnel Statistics and Key Factors
3.3.4 HR Early Warning System
3.3.5 HR Portfolio and HC Reporting
Challenges in HR Management & Leadership
4.1 International HR, Leadership and Diversity
4.1.1 International HR Management
4.1.2 Intercultural Leadership
4.1.3 Diversity Management
4.2 HR Management and Leadership in Industry 4.0
4.2.1 Artificial Intelligence and Industry 4.0
4.2.2 HR Management and Leadership with AI
4.3 Social Business HR Management and Leadership
4.3.1 Ethics, CSR and Social Business
4.3.2 HR and Leadership in NGOs and Social Business
Bibliography
Index
Figures
Fig. 1.1: Corporate Business Plan and HR Management
Fig. 1.2: Development of the Age Structure
Fig. 1.3: International Demography
Fig. 1.4: Potential Workers till 2060
Fig. 1.5: Personnel Management – HR Management
Fig. 1.6: HR Management Concept
Fig. 1.7: HR Commitment Index
Fig. 1.8: Life phase-oriented Personnel Policy
Fig. 1.9: Generations XYZ
Fig. 1.10: Employee Survey
Fig. 1.11: Change in the Corporate Organisation
Fig. 2.1: Theory X, Theory Y
Fig. 2.2: Pyramid of Needs
Fig. 2.3: Two-factor Theory
Fig. 2.4: Dynamic Leadership Roles and Hybrid Skills
Fig. 2.5: Trait Theory of Leadership
Fig. 2.6: Behavioural Leadership Theory
Fig. 2.7: Leadership Situation Theory
Fig. 2.8: Managerial Grid
Fig. 2.9: Leadership Styles and Leadership Corridor
Fig. 2.10: Job Requirement Profile
Fig. 2.11: Checklist Employee Introduction
Fig. 2.12: Checklist Supervisor Conversation Rules
Fig. 2.13: Checklist Conflict Moderation
Fig. 2.14: Employee Evaluation Report
Fig. 2.15: Project Team Size
Fig. 2.16: Management Seminar Moderation
Fig. 2.17: Corporate Career Models
Fig. 3.1: Centralised HR Department
Fig. 3.2: Decentralised HR Department
Fig. 3.3: HR Department
Fig. 3.4: Planning the Manpower Demand
Fig. 3.5: Personnel Planning Scheme
Fig. 3.6: Traineeship Program
Fig. 3.7: Change in Company Qualification Structures
Fig. 3.8: HR in a Management Information System
Fig. 3.9: HR Marketing Budget
Fig. 3.10: Calculation Personnel Process Costs
Fig. 3.11: Distribution of Salary Groups
Fig. 3.12: Balanced Scorecard
Fig. 3.13: HR Portfolio
Fig. 3.14: Strategic HR Planning Portfolio
Fig. 4.1: Employees and Turnover of large Companies
Fig. 4.2: Cultural shock and assimilation process
Fig. 4.3: Personnel Costs International Assignments
Fig. 4.4: Cultural Map – World Value Survey
Fig. 4.5: Telemetry – Smart Factory Connection
Fig. 4.6: Leadership Styles in Industry 4.0
Fig. 4.7: Distribution of employee structures
Abbreviations
1. HR
Management Policy and Strategy
1.1 HR Management Policy
1.1.1 Corporate Policy and HR Management
1.1.2 Governance, Compliance and Co-determination
1.1.3 HR and Leadership related Megatrends
1.1.4 Strategic HR and Human Capital Management
1.2 Concepts and Instruments of HR Policy
1.2.1 HR and Leadership Guidelines
1.2.2 Employee Relations, HR Research and Survey
1.2.3 Works Agreement
1.2.4 Employer Branding
1.2.5 Annual HR Report and Staff Meeting
1.2.6 Change Management
1.1 HR Management Policy
1.1.1 Corporate Policy and HR Management
Corporate Policy (policy: consciously enforcing will) is decision making and design of the long-term corporate goals and their adaptation to internal and external framework conditions or influences – as basis for following operationalized divisional, department etc. planning activities (see following example in the HR Division).
Fig. 1.1: Corporate Business Plan and HR Management
Example Corporate Policy Operationalisation
The example is showing a typical corporate policy objective (increase profit and rentability) operationalised top down to an individual workplace objective:
Corporate Policy: Increase Profit + Rentability
Influences on Corporate Policy
The diversity and complexity of influences on an HR and Leadership policy are resulting from many different internal and external stakeholders, company history and culture, megatrends (demography, globalisation …) and socio-political discussions (minimum wage, work-life balance …) in the society. Typical HR and Leadership related claims of stakeholders are e.g.:
Manager: job satisfaction, high income, prestige, power and career, self-development, ...
Employees: job and social security, healthy work conditions, training and career opportunities, social contacts, ...
Collective partner (e.g. union, works council): compliance with and participation in a collective agreement, fairness of the negotiations, …
Economy: labour market situation, purchase power, …
Compliance environment: labour law, co-determination due unions and works council, …
Socio-political: values, education, demography, diversity, income tax, policy, income distribution, minimum wage, working time regulations, …
Technology: ICT acceptance, home office, virtual work, …
Shareholder Value- and Stakeholder orientated HR Policy
While a traditional shareholder value-orientated corporate policy is mainly stability-, conservative- and short term-oriented, the stakeholder-oriented approach is progressive and focused on long-term corporate development, investing in training and personal development of the employees.
Shareholder Value-oriented HR and Leadership:
HR is seen as a cost factor, e.g.:
focus on short-term oriented individual and team performance to create profit/corporate value,
short-term oriented personnel planning and recruitment,
performance related income concepts,
more training for direct work success than long-term development programs.
This traditional one-dimensional focus on a short-term return on invest equity has becoming increasingly critical, not only because of the discussion about ethics.
Stakeholder orientated HR and Leadership policy:
HR Development seen as an investment,
primary goal is searching and creating new potential candidates, and
feelgood-, talent- and career management for long term employer branding,
In the same as in the general corporate policy companies often move between these polarities due situational factors and corporate policy dynamics, or larger ones follow different policies parallel in their different divisions. Especially in the last two decades in the background of corporate ethics, work-life balance and CSR more and more companies are tending to become more stakeholder-oriented.
The individual corporate profit orientation as a guiding principle must to be see critically today, as it often leads beside environmental damage to individual psychological and social problems (e.g. mental problems, unemployment).
Example Criticism of the Shareholder Value approach
In our times almost 200 of the leading US-entrepreneurs (e.g. from Apple to Pepsi and Walmart) are moving away from maximizing profits in a public statement. They distanced themselves from a pure shareholder-value approach by defining new principles of corporate management: … we know that many Americans have problems. Too often hard work is not rewarded and enough is not done to allow workers to adapt to the rapid pace of economic change. In the future, the focus will be more on investing in employees, in environmental protection and in fair and ethical dealings with suppliers.¹
1.1.2 Governance, Compliance and Co-determination
Corporate Governance and Corporate Compliance are partly interdepend-dent: the governance focus in on the corporate's constitutional (legal) basis, compliance aims at whether and how these are followed, and if necessary other voluntary rules of conduct such as Business Ethics and CSR. Co-determination due unions and works council or employee participation is (culturally depending) by laws and/or a lived social standard in a society.
Corporate Governance and Compliance
Traditionally, corporate governance in the sense of shareholder value-oriented management aims at responsible management and corporate control to create value.
This has played an important role for HRM and Leadership in recent years, esp. against the backdrop of spectacular bankruptcies and the legally and ethically dubious management behaviour of known consulting firms (e.g. Arthur Anderson, EY) and companies (e.g. Wirecard, Enron, Volkswagen Dieselgate). Frequent criticism (esp. from foreign investors) is e.g. lack of transparency in company management or lack of independence of German supervisory boards. Or the unusually high manager salaries or success bonuses in Germany with the simultaneous systematic destruction of company values. Accordingly, more and more socially recognized rules for responsible corporate management are being discussed in public.
Example Corporate Governance in Germany
Corporate Governance
The German Corporate Governance Code (DCGK) developed by a government commission in 2002 contains various rules and recommendations on different levels of commitment:
important legal regulations (e.g. from the German Stock Corporation law like renumeration of the executive board or the supervisory board),
voluntary recommendations and suggestions for action, e.g. on the ethical management behaviour.
Corporate Governance Report (DHL Group, excerpt)²
Essential elements of its corporate governance structures: the declaration of conformity by the executive board and the supervisory board, essential corporate governance practices that go beyond the legal requirements, e.g. as
Code of Conduct and Compliance Management as ... guidelines for all employees and at all hierarchy level daily behaviour with focus on respect, tolerance, honesty, openness, integrity towards employees and customers, to assume social responsibility, e.g. with an anti-corruption policy or mandatory staff training and compliance auditing.
Management Ethics
Even if there is little talk on corruption and fraud in industrialized countries, corruption in and by companies is more widespread than is publicly known. For example, in Germany approx. 70% of companies have corporate compliance guidelines (see example below). There are just a few cases shown in the media (e.g. emission scandal by Volkswagen, known as Dieselgate), but for years the number of corruption and fraud cases uncovered has been increasing – also through the corporates' compliance policy. The spectrum ranges from culturally expected invitations (restaurants, events) to company services (e.g. untaxed private use of company vehicles/aircraft) to active bribery.
Example Global Fraud Survey – results for Germany
A study of over 2.500 companies in 55 countries worldwide by EY shows, among other things:³
that e.g. almost no manager in Scandinavia, in Switzerland or in Germany regards this as widespread in their own country, but
contrary to this subjective assessment, cases of fraud or corruption registered in Germany have been increasing for years (in more than every sixth company there was a major fraud case in 2016/2017), and
every 6th manager also holds e.g. restaurant/event invitations for justified.
Examples of ethical goals for managers should be:
Knowledge and implementation of ethical aspects in their functional responsibility (e.g. customers, purchasing, production),
as well as in relation to their employees and team leadership.
Induce and empower your team members to self-critically examine their own values and actions.
They should encourage their employees to raise ethical concerns, and
support them in making decisions about ethical behaviour.
Ensure that everyone feels committed to the common corporate values and basic social values.
Freedom and support for ethically justified changes in the work area.
Example Corporate Compliance Policy (Bayer)⁴
With its corporate compliance policy as a basis for action, Bayer (active in nearly all countries, 104.000 employees) wants to be successful in