Part

Part 1:
1: Nature
Nature of
of Human
Human Resource
Resource
Management
Management
Chapter 1: Changing Nature of Human
Resource Management

Prepared by Linda Eligh, University of Western Ontario

Copyright 2008 by Nelson, a division of Thomson Canada Limited.

11

Learning
Learning Objectives
Objectives
After you have read this chapter, you should be able to:
1. Define HR management and identify the seven
categories of HR activities.
2. Discuss management of human capital in
organizations.
3. Discuss four challenges facing HR today.
4. Describe how the major roles of HR management are
being transformed.
5. Identify the purposes and uses of HR technology.
6. Discuss why ethical issues affect HR management.
7. Explain the key competencies needed by HR
professionals and why certification is important.
Copyright 2008 by Nelson, a division of Thomson

12

Nature
Nature of
of Human
Human Resource
Resource Management
Management
Human Resource (HR) Management
The policies, practices and systems that influence
employees behaviour, attitude and performance in
the attainment of organizational goals.

Who is an HR Manager?
In the course of carrying out their duties, every
operating manager is, in essence, an HR manager.
HR specialists design processes and systems that
operating managers help implement.

Copyright 2008 by Nelson, a division of Thomson

13

HR
HR Management
Management Activities
Activities

Copyright 2008 by Nelson, a division of Thomson

Fig.
Fig.1-1
1-1

14

Nature
Nature of
of Human
Human Resource
Resource Management
Management
HR Activities:
Global forces and HR Management
Strategic HR Management
Equal Employment Opportunity
Staffing

Copyright 2008 by Nelson, a division of Thomson

15

Nature
Nature of
of Human
Human Resource
Resource Management
Management
HR Activities (contd):
HR Development
Compensation and Benefits
Health, Safety, and Security
Employee and Labour Relations

Copyright 2008 by Nelson, a division of Thomson

16

Nature
Nature of
of Human
Human Resource
Resource Management
Management
Smaller Organizations and HR Management
Shortage
ofof
Shortage
Qualified
Qualified
Workers
Workers

Increasing
Increasing
Competition
Competition

Increasing
Increasing
Costs
Costs
(Benefits)
(Benefits)

Issues
ofof
Issues
Greatest
Greatest
Concern
Concern

Increased
Increased
Wage
Wage
Pressures
Pressures

Legislative
Legislative
Changes
Changes

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17

Typical
Typical Division
Divisionof
ofHR
HRResponsibilities:
Responsibilities: Training
Training

Copyright 2008 by Nelson, a division of Thomson

Fig.
Fig.1-2
1-2

18

Management
Management of
of Human
Human Capital
Capital
in
in Organizations
Organizations
Human Capital
The collective value of the capabilities, knowledge,
skills, life experiences, and motivation of an
organizational workforce.
Also

known as intellectual capital.

How to measure the strategic value of human assets?

Human Resources as Core Competency

A unique capability that creates high value and
differentiates an organization from its competition.
HR

competencies: a source of competitive advantage.

Copyright 2008 by Nelson, a division of Thomson

19

HR
HR Management
Management Challenges
Challenges
Most prevalent challenges facing HR management:
1. Globalization of Business
2. Economic and Technological Changes
3. Labour
4. Workforce Demographics and Diversity
5. Organizational Cost Pressures and
Restructuring

Copyright 2008 by Nelson, a division of Thomson

110

HR
HR Management
Management Challenges
Challenges
1. Globalization of Business
Outsourcing and offshoring
Global security and terrorism

2. Economic and Technological Changes

Occupational shifts from manufacturing and
agriculture to service and telecommunications. Job
growth primarily in IT and healthcare
Workforce availability and quality concerns

Inadequate supply of workers with soft

skills needed for knowledge jobs
Significant shortage across Canada of
tradespeople

Copyright 2008 by Nelson, a division of Thomson

111

HR
HR Management
Management Challenges
Challenges
3. Labour
Employee retention
Growth of contingent workforce

Increases in temporary workers, independent

contractors, leased employees, and part timers
caused by need for flexibility in staffing, more
difficulties in firing regular employees, and
reduced legal liability for contractors.

Technological shifts and the Internet

Growth of information technology creating more

virtual employees and other challenges

Employability Skills

Copyright 2008 by Nelson, a division of Thomson

112

HR
HR Management
Management Challenges
Challenges
4. Workforce Demographics and Diversity
Multiculturalism
Visible minorities and diversity

20% of workforce born outside Canada

with growing presence of visible minorities

More women in the workforce

Single-parent households, dual career

couples, domestic partners, working
mothers and family/childcare

Aging workers

Significant numbers of experienced

employees are retiring, changing to part time etc.
Age discrimination

Copyright 2008 by Nelson, a division of Thomson

113

HR
HR Management
Management Challenges
Challenges
5. Organizational Cost Pressures, Restructuring
Mergers and Acquisitions
Right-sizingeliminating layers of management,
closing facilities, merging with other organizations,
and outplacing workers

Intended results are flatter organizations, increases in

productivity, quality, service and lower costs.
Costs are survivor mentality, loss of employee loyalty, and
turnover of valuable employees.

HR managers must work toward ensuring

cultural compatibility in mergers.

Copyright 2008 by Nelson, a division of Thomson

114

HR
HR Management
Management Roles
Roles
Administrative Role
Clerical and administrative support operations (e.g.,
payroll and benefits work)
Technology

is transforming how HR services are delivered.

Outsourcing HR services to reduce HR staffing costs

Operational and Employee Advocate Role

Champion for employee concerns
Employee

crisis management
Responding to employee complaints

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115

Changing
Changing Roles
Roles of
of HR
HR Management
Management

Fig.
Fig.1-4
1-4

Note: Example percentages are based on various surveys.

Copyright 2008 by Nelson, a division of Thomson

116

HR
HR Management
Management Roles
Roles
Strategic Role
Contributing at the Table to organizational results
HR becomes a strategic business partner by:
Focusing

on developing HR programs that enhance

organizational performance.
Involving HR in strategic planning at the onset.
Participating in decision making on mergers, acquisitions,
and downsizing.
Redesigning organizations and work processes
Accounting and documenting the financial results of HR
activities.

Copyright 2008 by Nelson, a division of Thomson

117

Operational
Operationalto
toStrategic
StrategicTransformation
Transformationof
ofHR
HR

Copyright 2008 by Nelson, a division of Thomson

Fig.
Fig.1-5
1-5

118

HR
HR Management
Management Roles
Roles
Collaborative HR
The process of HR professionals from several
different organizations working jointly to address
shared business problems.
Firms benefit from the expertise of other firms,
without having the time and expense of developing
some of their own HR practices.

Copyright 2008 by Nelson, a division of Thomson

119

HR
HR Technology
Technology
Human Resource Management System (HRMS)
An integrated system providing information used by HR
management, in conjunction with other managers, in
decision making.
Purposes (Benefits) of HRMS
Administrative

and operational efficiency in compiling HR data

Availability of data for effective HR strategic planning

Uses of HRMS
Automation

of payroll and benefit activities

EEO/affirmative action tracking
HR Workflow: increased access to HR information
Employee self-service reduces HR costs.
Copyright 2008 by Nelson, a division of Thomson

120

Web
Based
Systems
Fig.
Figure
1-6:
Web
Based
Web
Based
Systems
Fig.1-6
1-6
Figure
1-6:
Web
Based Systems
Systems
Bulletin boards
What

information will be available and what is information

needed?

Data access
To what

uses will the information be put?

Employee self-service
Who

will be allowed to access to what information?

Web-based services and access

Extended linkage
When,

where, and how often will the

information be needed?

Copyright 2008 by Nelson, a division of Thomson

121

Ethics
Ethics and
and HR
HR Management
Management
Firms with High Ethical Standards
Are more likely to reach strategic goals.
Are viewed more positively by stakeholders
Are better able to attract and retain human resources.

Ethics and Global Differences

Different legal, political, and cultural factors in other
countries can lead to ethical conflicts for global
managers.
Corruption of Foreign Public Officials Act
Prohibits

Canadian firms from engaging in bribery and other

practices in foreign countries.

Copyright 2008 by Nelson, a division of Thomson

122

Ethics
Ethics and
and HR
HR Management
Management
HRs Role in Organizational Ethics:
HR management plays a key role as the keeper and
voice of organizational ethics.

What is Ethical Behaviour?

What ought to be done.
Dimensions of decisions about ethical issues in
management:
Extended

consequences
Multiple alternatives
Mixed outcomes
Uncertain consequences
Personal effects

Copyright 2008 by Nelson, a division of Thomson

123

CCHRA
CCHRACHRP
CHRPNational
NationalCode
Codeof
of Ethics
Ethics

Fig.
Fig.1-7
1-7

.
1. Preamble
2. Competence

CCHRA/CHRP

3. Legal Requirements
4. Dignity in the workplace
5. Balancing Interests
6. Confidentiality
7. Conflict of Interest
8. Professional Growth and
Support of Other
Professionals
9. Enforcement

Copyright 2008 by Nelson, a division of Thomson

124

Ethics
Ethics and
and HR
HR Management
Management
HRs Role in Organizational Ethics:
Responses to Ethical Situations
Are guided by values and personal behaviour codes
that include:
Does

response meet all applicable laws, regulations, and

government codes?
Does response comply with all organizational standards of
ethical behaviour?
Does response pass the test of professional standards for
ethical behaviour?

Copyright 2008 by Nelson, a division of Thomson

125

Examples
Examplesof
ofEthical
EthicalMisconduct
Misconduct in
inHR
HRActivities
Activities

Copyright 2008 by Nelson, a division of Thomson

Fig.
Fig.1-8
1-8

126

Ethics
Ethics and
and HR
HR Management
Management
Ethical Behaviour and Organizational Culture:
Organizational Culture
The shared values and beliefs in an organization
Common forms of unethical conduct:

Lying to supervisors
Employee drug use or alcohol abuse
Falsification of records

Fostering Ethical Behaviour

A written code of ethics and standards of conduct

Training on ethical behaviour for all employees
A means for employees to obtain ethical advice
Confidential reporting systems for ethical misconduct

Copyright 2008 by Nelson, a division of Thomson

127

HR
HR Management
Management Competencies
Competencies
and
and Careers
Careers
Important HR Competencies
Strategic contribution to organizational
success
Business knowledge of the organization and
its strategies
Effective and efficient delivery of HR services
Familiarity with HRMS technology
Personal credibility
Copyright 2008 by Nelson, a division of Thomson

128

Human
HumanResources
ResourcesProfessional
ProfessionalCapabilities
CapabilitiesProfile
Profile

Copyright 2008 by Nelson, a division of Thomson

Fig.
Fig.1-9
1-9

129

HR
HR Management
Management Competencies
Competencies
and
and Careers
Careers
HR Management as a Career Field
HR Generalist
A person with responsibility for performing a variety of
HR activities.

HR Specialist
A person with in-depth knowledge and expertise in a
limited area of HR.

Copyright 2008 by Nelson, a division of Thomson

130

Expected
ExpectedEarnings
Earningsby
byAge
Agefor
for an
anHR
HRManager
Manager

Copyright 2008 by Nelson, a division of Thomson

Fig.
Fig.1-10
1-10

131

HR
HR Management
Management Competencies
Competencies
and
and Careers
Careers
HR Professionalism and Certification
Professional Involvement and Development
Involvement by HR Professionals in professional
associations and organizations has become important
because of the broad range of issues they face.
Examples include:

Human Resources Professionals Association of

Ontario (HRPAO)
Canadian Public Personnel Management
Association (CPPMA)

Copyright 2008 by Nelson, a division of Thomson

132

HR
HR Management
Management Competencies
Competencies
and
and Careers
Careers
CHRP Designation
Administered by the Canadian Council of Human
Resource Associations (CCHRA) in partnership with
provincial Human Resources associations.
Eligibility requirements vary by provincial
associations, but the National Knowledge Exam
(NKE) and Professional Practice Exam (PPE) is the
same for everyone.

Copyright 2008 by Nelson, a division of Thomson

133