human resource management basics and fundamentals

no matter what business you’re in you have to manage people to do this successfully you have to be well-versed in a variety of issues from recruiting to hiring to compensating training and managing performance and that’s what this course is all about in this course I want to share with you the fundamentals of managing people also known as Human Resources we’ll begin by taking a look at administrative and strategic HR talent management and the business case for diversity we’ll also look at training employees and managing performance finally we’ll consider culture and international assignments managing people well isn’t just a formula rather it’s about creating a work environment that allows others to do their best let’s get started you whether you work for a fortune 500 firm or for a small business you have to address people related business issues these include finding and keeping top talent as a manager in the course of your work you have to deal with financial material information and human resources the very best managers are optimizers because they get the most out of all of the resources available to them as a manager this course is designed just for you I won’t be covering every possible aspect of managing people this course is designed for general managers who will have to manage people along with other resources the course is an overview not a formula or a step-by-step approach my intent is to focus on some key concepts that will get you started on your way to managing people effectively with all of this in mind let’s dive into human resources fundamentals suppose you were starting a brand new organization you probably wouldn’t have an HR department because your organization is just getting underway nevertheless as you begin to grow you and the managers you hire will need to be concerned about five broad areas that involve people staffing retention development adjustment and managing change together these five broad areas constitute human resource management or the HRM system and much of it is administrative the first area is staffing which begins by identifying the work to be done and the kinds of personal characteristics necessary to do the work determining the numbers of people and the mix of skills that you’ll need to do the work and then recruiting selecting and eventually promoting qualified candidates retention of your new employees is more likely when you do three things wealth reward employees for performing their jobs effectively ensure harmonious working relations between employees and their managers and maintain a safe healthy work environment development focuses on preserving and enhancing your employees competence in their jobs by improving their knowledge skills abilities and other characteristics HR specialists call these competencies adjustment is concerned with compliance with federal and state laws as well as with your organization’s policies for example through discipline and business strategies such as cost leadership finally managing change is an ongoing process its objective is to enhance your new organization’s ability to anticipate and respond to developments in the environment political economic social and technical and to enable employees at all levels to cope with those changes to some these activities are the special responsibilities of the HR department but they also lie within the core of every manager’s job in fact HR departments typically don’t even appear until organizations reach 100 employees thus abroad objective of HR management is to allow all of your employees to perform to the very best of their abilities a special objective of the HR department is to help your line managers to manage those workers more effectively as Jack Welsh the legendary former CEO of General Electric noted look HR should be every company’s killer app what could possibly be more important then who gets hired developed

promoted or moved out the door business is a game and as with all games the team that puts the best people on the field and gets them playing together wins it’s that simple doing things to help line managers put the best people on the field helping people at all levels to grow getting them to play well together and to stay is really what administrative HR is all about imagine this you’re the coach of a basketball team and you’re preparing to play your archrival would you rather have your team play the game by taking the floor and simply reacting to whatever your opponent does if you were playing chess would you simply react to whatever moves your opponent makes the answer in both of these situations is an emphatic no rather you would most likely have a well-developed game plan that game plan is known more formally as a strategy in business settings firms make decisions and choices about how to position themselves for sustainable competitive advantage those decisions and choices define each firms competitive position every firm makes decisions about issues such as customers who will it serve processes how it will create value leaders their priorities focus and dedication staff who it hires develops and retains vision it’s reason and purpose for existence those decisions to find each company’s genetic code that code should be clear simple and understandable for it provides lifelong direction to an organization here are some examples of strategic visions Southwest Airlines fun low fares coca-cola a coke within an arm’s reach general electric number one or number two in what we do CNN 24-hour news and Disneyland the happiest place on earth at a broader level strategy answers questions such as why should customers buy from your company what do you do better than anyone else do you offer products or services that no other competitor can match do you offer the cheapest products or services are your products or services the highest quality ones available do you deliver your products or services faster than any competitor can does your company provide the very best customer service competitive strategy is about choices and trade-offs that firms make it’s about being different it means deliberately choosing a different set of activities in order to deliver a unique mix of value to the customer human resource strategy refers to the decisions processes and choices that firms make about how they will manage their people it parallels and supports the strategic business plan to do that well however it requires a focus on planned major changes in the organization and on critical issues such as what are the HR implications of your proposed strategy what constraints might you face in implementing that strategy what are the implications for how you’ll manage your people how you’ll develop them and the leadership succession issue what can you do in the short term to prepare for longer term needs in this approach to the strategic management of Human Resources a firm’s business strategy and its HR strategy or interdependent to illustrate consider that you’re in a startup business in a completely new market space think ebook readers versus traditional print media think 3d printing think advanced batteries and fuel cells to replace gasoline engines you’re trying to appeal to customers who want to break from the present and also to those who want to invest in a product that will see the future industry to survive you need a critical mass of early users what does all this mean for the people you hire well they should be smart technically savvy and totally committed to your vision how will you judge their performance the key consideration will be their ability to generate and execute breakthrough ideas how will you reward them because early stage companies don’t have the cash flow to pay high salaries major emphasis will be on stock options or stock grants what will you emphasize in training and development because the major emphasis at this stage is on research and development training will focus primarily on developing technical

competencies can you see how HR strategy parallels and facilitates the more general business strategy this is what HR strategy is all about talent management is the process employers use to anticipate and meet their needs for human capital that is people it’s gained increasing attention in the last decade or so as companies professional associations and even governments have become interested in it unfortunately there’s not a common understanding of what the term talent management means nor is there a common understanding of its aims and scope for example there’s disagreement among experts about whether talent management is about all employees the inclusive approach or whether it refers only to the talents of high potential or high-performing employees the exclusive approach regardless of one’s perspective a major challenge is to manage the talents of employees effectively after they are on board there are at least four broad approaches to talent management let’s consider each one of them briefly first is the people approach identify star performers and then devote special attention to developing them to vote lesser attention to workhorses high performers with little potential to move up or problem children low performers with high potential next is the practices approach connect key HR practices those used to attract recruit and retain talent identify high potential employees and manage leadership succession plans develop employees through coaching and mentoring and deliver performance through effective performance management another approach to consider is the position approach identify a B and C positions a positions are strategically important and mistakes can have serious financial consequences B positions are support roles and C positions are not strategic and can be outsourced the challenge is to get a players into a positions finally there is the strategic pools approach focus on identifying pools of internal talent for the purpose of succession planning and then devote time and resources to ensuring that replacements are ready should a need arise in practice these four approaches represent a range of dilemmas that any talent management system has to deal with most organizations use them in combination to address trends such as the following global abundance but local scarcity of talent fewer young people and more older people many heading rapidly towards retirement of course this depends on each nations demographic trends more differences across generations at work as well as similarities for example the need for respect support of bosses and credible trustworthy leaders and more diverse remote and virtual workforces with different attitudes towards work what does all of this mean for you personally recognize that you are in control of your own talent for example you may decide to work for multiple organizations at the same time after all talent can come from anywhere in the world at the same time you have more freedom than ever to manage your own career as for the role of HR in talent management it is the provider of talent guidance tools and coaching to enable you to own responsibility for your personal development the concept of diversity all the things that make us different from each other is more than just a passing blip on the corporate conscience diversity is not just things you can see like age and gender race and ethnicity it’s also the many things you can’t see like experience field of education where you grew up your personality type and cultural influences that affect how you think and what you believe diversity is not just something a company should have or ought to have it’s something that virtually all companies already do have many companies view it as a major competitive factor and something to celebrate and to leverage to their advantage as MGM Resorts says we are at our most effective as an organization when we are at our most inclusive likewise

IBM proclaims proudly we learned early on that fostering diversity is not only the right thing to do for society but for business as well in this video I want to share with you five key trends in organizations and in markets that comprise the business case for diversity the first is changing labor markets you can be sure of this over the next 25 years the US workforce will comprise more women more immigrants more people of color and more older workers globally more than 500 million people double the number today will legally work outside their home countries in the next 20 years why experts point to factors such as conflict natural disasters climate change and economic opportunism workplaces everywhere will be characterized by more diversity in every dimension next is the shift from manufacturing to services today roughly 90 percent of US employees work in service based industries such as banking financial services health care tourism and retail looking ahead virtually all of the growth in new jobs will come from service producing industries jobs in those industries require lots of interaction with customers to be effective employees need to develop the skill of customer literacy that is the ability for employees to read their customers to understand them to anticipate and monitor their needs and expectations and to respond sensitively and appropriately in the service game customer literacy is an essential skill and having a diverse workforce is an important step towards that kind of customer literacy another key trend is the globalization of markets as organizations around the world compete for customers they offer customers choices unavailable to them domestically people everywhere worship two words cheap and available with more options to choose from customers have more power to insist that their needs and preferences be satisfied to satisfy them firms have to understand their customers better to do that some firms have established a strong local presence such as Japanese carmakers using advertisements that showcase local dealerships and satisfy donors others have forged strategic international alliances such as Microsoft and Nokia Fiat and Chrysler leading global companies measure success in this area of cultural learning just as they measure other business factors a big trend today is the growth in mergers acquisitions and international alliances the managers who’ve worked out the results of all the mergers acquisitions and strategic international alliances occurring over the past 20 years already know what several large studies have found that integrating diverse company cultures is the top challenge in mergers and acquisitions corporate cultures may differ in many ways such as the customs of conducting business how people are expected to behave and the kinds of behaviors that get rewarded the challenge for both workers and managers is to understand and capitalize on that diversity as companies combine their efforts to offer goods and services to customers in far-flung markets the final trend to consider is new business strategies that require more teamwork teams mean diverse workforces because they often draw from the most talented or experienced employees young and old male and female better and less well educated members from different departments these are just some of the dimensions along which team members may differ coordinating those talents to develop new products better customer service or ways of working more efficiently is a difficult yet essential aspect of business strategy and it presents new kinds of management challenges so think about diversity in your company is the mix of people changing how is your industry changing does it require closer interaction with customers what about the actual work is more of it being done in teams are you expanding into new markets think about the short term and long term consequences of these changes by deeply considering these factors and their implications for your company you’ll be well on your way towards

managing diversity effectively you over the past decade organizations have become more complex dynamic and fast-paced as a result senior managers recognized that attracting retaining and managing people effectively it’s more important than ever to do that effectively will examine nine critical competencies for HR success but first here’s some background on how they were developed beginning in 2011 the Society for Human Resource Management conducted a multi-year study that included input for more than 1,200 HR professionals from 33 nations and survey responses from 32,000 participants extensive analyses of these data identified nine competencies each one of them includes sub competencies and behaviors along with proficiency standards by career level early-mid senior and executive levels here’s an overview of each of these nine competencies the first is human resource expertise this is the ability to know and apply the principles and practices of human resource management to contribute to the success of a business next is relationship management this is in reference to your ability to manage interactions among people to provide services to help line managers manage and to support the organization another important competency is consultation your ability to provide guidance to employees managers and other stakeholders leadership and navigation covers your ability to direct and contribute to performance and to processes like staffing performance management and rewards a key competency at all levels is communication ensuring you can exchange information and convey understanding with employees managers and other stakeholders related to this is global and cultural effectiveness your ability to value and consider the perspectives and backgrounds of all parties the seventh competency is ethical practice meaning can you support uphold and model the values of your organization while mitigating risk the eighth competency is critical evaluation this is the ability to understand the logical connections between ideas in order to evaluate arguments and to make business decisions and recommendations the final competency is business acumen your ability to understand and apply information in order to contribute to your organisation’s strategic plan what does all of this mean for you well it’s important that you know about these competencies it’s even more important that you work on developing each of them throughout your career and that you’re able to demonstrate them on the job note that the first competency is technical expertise in the many areas of HR and that the remaining eight competencies are all behavioral technical HR knowledge certainly provides a sound foundation but consider the remaining eight behavioral competencies as a roadmap to business and career success after all employers are less interested in your ability to know and more interested in your ability to do ultimately your ability to perform will determine how successful you are in your career pay is important to many people entering the workforce today but there’s something else that young people tell us is as important if not more so the opportunity for training and development why is this so because lifelong learning is no longer a luxury it’s a necessity young people can expect to have eight to ten jobs by the time they reach their mid-30s and they can expect to be laid off three to four times by the time they reach their mid-50s training and Retraining is essential to maintain skills what is training it’s a plan program designed to improve your performance whether you’re working individually or as a member of a team consider just a few of the many benefits of training training can sharpen your technical skills build your knowledge base improve the ways you interact with managers customers and other employees promote greater innovation allow you to practice so you can perform at constantly high

levels and convince you that you can perform well in your career let’s say you’re trying to learn a new skill what does effective training look like it incorporates five key features here’s a brief description of each one the first is goal-setting more than 500 studies have demonstrated goal settings proven track record of success in improving employee performance in a variety of settings and cultures the best training programs are crystal clear about their objectives they allow you to set challenging goals and they supplement the ultimate goal of finishing the program with sub goals during the training as you clear each of these hurdles successfully your confidence about finishing the program grows next is behavior modeling you can learn a lot by observing others we will imitate other people’s actions when they lead to things we care about for example promotions increased sales or more accurate tennis serves the models actions serve as cue about appropriate behavior a model is someone who’s seen as competent powerful and friendly and has high status within an organization modeling is most effective when the model is similar to you in age gender and race he or she demonstrates the behaviors to be modeled clearly and in detail and provides lots of repetitions of them finally several models demonstrate the behaviors not just one another key feature is meaningful material it’s easier to learn and remember material when you can relate to it meaningful material is rich in associations and it’s therefore easily understood for example if I tell you that the proper way to hold your ski poles is to keep them in front of you like you were reading a newspaper can you relate to that next practice practice makes perfect anyone learning a new skill or acquiring knowledge must have an opportunity to practice what he or she is learning practice and repetition helps you to refine your technique if you’re learning a skill or to store knowledge of facts in your long-term memory and finally there’s feedback feedback is essential both for learning and to keep people motivated the best feedback is immediate it’s specific and it’s something you can control for example your presentation will be easier to follow if you use a consistent font size in many ways you’ll be training throughout your career to get the most out of it be sure that it incorporates goal-setting behavior modeling meaningful material practice and feedback suppose you manage a workgroup that’s not functioning particularly well and you know that you’re not the only manager in your organization who faces this problem what might you do to turn the situation around what can your fellow managers do to improve the performance of the workgroups that they manage one approach is called organization development which itself is based on action research a systematic long-range program designed to improve the performance of your workgroup as well as that of the broader organization while action research may assume many forms one of the most popular is survey feedback the process begins with a preliminary diagnosis for example by an outside consultant who’s known as a change agent he or she should be skilled in the methods of applied behavioral science the preliminary diagnosis may include interviews with managers and a few of the employees in each work group the purpose of these interviews is to enable the consultant to get a general sense of the key issues the workgroups are concerned about the next step is a comprehensive assessment of the way each of the work groups including yours is currently functioning one way to do this is to administer anonymous questionnaires to all group members for example using a rating scale that ranges from strongly agree to strongly disagree you and each of your employees rate a number of items typically 10 to 30 or so for example these might include items such as decisions usually are made on the basis of the best information available cooperation across different parts of the organization is actively encouraged and there is continuous investment in the skills of employees the outside consultant then tabulates responses for each individual work group

and for the organization as a whole you as well as each of your fellow managers receive a summary of this information based on the responses of the employees who report to you and for the other managers the employees who report to them then the outside consultant meets privately with you as well as with each of the other managers to maximize understanding of the survey results following this the consultant slash change agent attends a meeting face-to-face or virtual of you and your workgroup members the purpose of which is to examine the survey findings and to discuss implications for corrective action the role of the consultant is to help you and your workgroup members to understand the survey results better to set goals and to formulate action plans to improve the way the workgroup functions the consultant then repeats this process with every other workgroup throughout the organization roughly six months or so after each workgroup actually implements its action plan the consultant returns for another preliminary diagnosis and the entire process begins anew if the plans are successful your workgroup as well as the others will improve over time and the results of those improvements can be demonstrated objectively this is what organization development is all about consider the following situations the athlete searching for a coach who really understands her the student schedule to see his guidance counselor at school the worker who has just begun reporting to you his new boss what do these situations all have in common the need to manage performance effectively think of performance management as a kind of compass one that indicates a person’s actual direction as well as his or her desired direction like a compass your job as a manager is to indicate where that person is now and to help focus attention on where he or she should be heading there are solid payoffs for doing performance management well if you work for an organization with a great performance management system you will have a clear line-of-sight that links your work to the success of your organization you’ll perform better in your work and you’ll probably be amply rewarded for your excellent performance organizations with such systems are 51 percent more likely to outperform their competitors on financial measures and 41 percent more likely to outperform their competitors on non-financial measures such as customer satisfaction employee retention and quality of products or services obviously if performance management were easy to do more firms would do it one of the reasons it’s difficult to execute well throughout an entire organization is that performance management demands daily not annual attention from every manager it’s part of a continuous process of improvement over time let’s say you’re a manager with four direct reports to manage their performance effectively you need to do three things well the first is define performance if you’re crystal clear about your expectations with each of your direct reports they’ll know what’s expected of them and they’ll stay focused on meeting your expectations how do you do this by paying careful attention to three key element goals measures and assessment set specific challenging goals for each of your people for this clarifies precisely what you expect and it leads to high levels of performance merely setting goals is not sufficient though you also must be able to measure progress towards each goal a goal such as make the company successful it’s too vague to be useful but measures such as the number of defective parts produced per million or the average time to respond to a customer’s inquiry are much more tangible once you’ve set challenging goals and tangible measures your next task is to assess progress towards those goals when you do that you offer each of your direct reports a scorecard that will get their attention to define performance properly therefore you must do three things well set goals decide how to measure progress and provide regular assessments of achievement the next step is to facilitate performance to do this well recognize that one of your major responsibilities as a manager is to eliminate roadblocks that get in the way

of successful performance here are just a few examples of obstacles that can inhibit maximum performance outdated or poorly maintained equipment delays in receiving supplies and inefficient work methods employees are well aware of these and they’re only too willing to identify them if you just ask for their input then it’s your job to eliminate these obstacles once you do this the next step is to provide adequate resources more money better equipment or more staff after all if employees lack the tools to reach the challenging goals they’ve set they’ll become frustrated and disenchanted conversely employees really appreciate it if you provide everything they need to perform well and they will respond in kind a final aspect of performance facilitation is the careful selection of employees after all the last thing you need is a manager is to have people who just don’t have the skills or the temperament to do their jobs well for example a customer service agent with a toxic personality that’s why leaving companies like Apple Google and Disney expect even top managers to get actively involved in selecting new employees encourage performance all of this leads to the final element of a solid performance management system namely encourage performance to do that well you have to do three more things provide rewards in a timely fashion soon after your people achieve their goals and distribute it rewards fairly explaining clearly why and how you rewarded your people in summary managing for maximum performance requires that you do three things well define performance facilitate performance and encourage performance remember like a compass your role as a manager is to provide orientation direction and feedback do those things well and you too will be richly rewarded you have you ever visited a foreign country where the language or customs were vastly different from your own often that results from a lack of understanding why people do what they do culture is software of the mind it refers to characteristic ways of doing things and behaving the people in a given country or region have evolved over generations it helps people to make sense of their part of the world and it provides them with an identity cultural differences profoundly affect how different people view the world and operate in business to help you navigate cultural landscapes let’s briefly consider ten factors this framework does not consider every aspect of culture and by no means is it the only way to analyze culture rather it’s a useful beginning for cultural understanding the first factor is sense of self and space people may adopt humble bearings in some places and macho behavior in others Americans have a sense of space that requires more distance between people while Latins and Vietnamese prefer to get much closer each culture has its own unique ways of doing things dress and appearance may vary dramatically around the globe dress includes outward garments as well as body decorations many cultures wear distinctive clothing the Japanese kimono the Indian turban the Polynesian sarong even uniforms that distinguish wearers from everybody else food and feeding habits also very extensively the manner in which food is selected prepared presented and eaten often differs by culture most major cities have restaurants that specialize in the cuisines of various cultures everything from Afghan to Zambian feeding habits also differ ranging from bare hands to chopsticks to full sets of cutlery communication and language may appear impenetrable to an hour cider moreover in many cultures directness and openness are not appreciated an open person may be seen as weak and untrustworthy and directness can be interpreted as abrupt hostile behavior providing specific details may

be seen as insulting to one’s intelligence insisting on a written contract may suggest that a person’s word is not good time and time consciousness to Americans time is money we live by schedules deadlines and agendas we hate to be kept waiting and we’d like to get down to business quickly in many countries however people simply will not be rushed they arrive late for appointments and business is preceded by hours of social rapport the opposite is true in Switzerland Sweden and Germany where prompt efficiency is the watchword relationships may be based on age gender status and family relationships as well as on wealth power and wisdom they also vary by category in some cultures the elderly are honored in others they are ignored in some cultures women must wear veils and act deferentially in others the female is considered the equal if not the superior of the male well most US firms frown upon the practice of hiring or contracting work directly with family members in Latin America or Arab countries it only makes sense to hire someone you can trust values reflect what is important in a society one such norm is that in Eastern countries businesspeople strive for successful business outcomes after personal relationships have been established while Westerners develops social relationships after business interests have been addressed international managers ignore those kinds of norms at their peril beliefs and attitudes in many countries religion expresses the philosophy of a people important facets in life while Western culture is largely influenced by judeo-christian traditions and Middle Eastern culture by Islam Buddhism Confucianism Taoism and Hinduism dominate oriental and Indian cultures work motivation and practices your knowledge of what motivates workers in a given culture combined with the knowledge of what they think matters in life will be critical to your success as an international manager Europeans pay particular attention to power and status which results in more formal management and operating styles in comparison to the informality found in the United States in the United States individual initiative and achievement are rewarded but in Japan managers are encouraged to seek consensus before acting and employees work as teams finally consider mental processes and learning linguists anthropologists and other experts who have studied mental processes and learning found vast differences in the ways people think and learn in different cultures while some cultures favor abstract thinking and concepts others prefer rote memory and learning what can we conclude from this what seems to be universal is that each culture has a reasoning process but it manifests that process in its own distinctive way if you don’t understand or appreciate those differences you may conclude erroneously that certain cultures are inscrutable admittedly all of this information is complex and this is a very broad area but you need to start somewhere this framework should help you understand global cultures better even though it’s a journey that has no finish line so continue to research and be curious about global cultures doing so will have immediate payoffs for you and for your organization you