Managing Human Resources, 19th Edition by Scott Snell, Shad Morris SOLUTIONS MANUAL

Solution Manual For

Purpose and Perspective of the Chapter

Think of a firm you do business with that is facing dramatic changes in order to survive. (Retailers such as Target and Macy’s, which are facing stiff competition from online retailers are an example.) How do you think the firm’s personnel can help it adapt? What role will the company’s HR staff play in helping with that goal? Which of these activities would you like to engage in your career:

• Establishing the strategic direction your firm should take

• Attracting top-notch people to come to work for you and your firm

• Determining the right people to hire so your team and company are a success

• Helping and coaching people so they become top-notch performers

If you answered yes to these questions, a job managing people might be a rewarding career for you and an excellent reason why you should study human resources management.

Having a good understanding of human resources management is important for managers and entrepreneurs of all types not just human resources (HR) personnel. All managers are responsible for at least some of the activities that fall into the category of management. Managers play a key role in selecting employees, training and motivating them, appraising them, promoting them, and so forth. It’s a job that can be incredibly rewarding like a gardener helping their crops to grow. But what if you do a poor job of these activities? Believe it or not, many businesspeople with great business strategies, business plans, and products and services fail because they do not fully grasp the importance of human resources management.

Chapter Objectives

The following objectives are addressed in this chapter:

1. Explain how human resource managers and other managers can have rewarding careers by helping their firms gain a sustainable competitive advantage through the strategic utilization of people.

2. Explain how good human resource practices can help a firm address strategic challenges such as globalization, competition, and sustainability efforts.

3. Describe how technology can improve how people perform and how they are managed.

4. Explain the dual goals HR managers have in terms of increasing productivity and controlling costs.

5. Discuss how firms can leverage employee differences to their strategic advantage and how educational and cultural changes in the workforce are affecting how human resource managers engage employees.

6. Provide examples of the roles and competencies of today’s HR managers and their relationship with other managers.

Key Terms

Agility: A firm’s ability make quick changes to gain a competitive advantage

Corporate social responsibility: Good corporate citizenship

Downsizing: The planned elimination of jobs

Employee engagement: The extent to which employees are enthused about their work and committed to it.

Employee leasing: An agreement with a professional employer organization (PEO) which takes over the management of the smaller company’s HR tasks and becomes a coemployer to its employees

Furloughing: The practice of requiring employees to take time off for either no pay or reduced pay

Homeshoring: The practice of outsourcing work to domestic workers who work out of their homes

Human capital: The employees’ knowledge, skills, abilities, and other attributes (KSAOs that have economic value to the firm

Human resources information system (HRIS): Used for everything from automating payroll used for everything from automating payroll processing to administering benefits programs

Human resources management (HRM): Involves a wide variety of activities, including analyzing a company’s competitive environment and designing jobs and teams so a firm’s strategy can be successfully implemented to beat the competition

Knowledge workers: Employee responsibilities expand to include a richer array of activities that involve analyzing information and problem-solving

Line managers: Non-HR managers who are responsible for overseeing the work of other employees

Nearshoring: The practice of bringing jobs closer to domestic countries

Offshoring: Also referred to as ―global sourcing,‖ involves shifting work to locations abroad

Organizational culture: The shared values, beliefs, assumptions, and expectations

Outsourcing: Hiring someone outside the company to perform business processes that were previously done within the firm.

Sustainability: A company’s ability to produce goods or services without depleting the world’s resources and doing the least amount of harm to the environment as possible

Workforce (H R) analytics: Using HR data, such as employee demographic information, performance ratings, pay, employee surveys, academic history, years of service, a firm can do a better job with workforce planning

What's New in This Chapter

The following elements are improvements in this chapter from the previous edition

Chapter # New component(s)

Chapter 1 ● More advice and guidance from women CEOs about the importance of managing people.

Chapter 1 ● New examples from new industries.

Chapter 1 ● A look at the increased importance of human resource managers due to the COVID-19 pandemic.

Chapter 1 ● New data pointing to the need for companies to manage disruption.

Chapter 1 ● The need to build a workforce composition able to implement multiple strategies.

Chapter 1 ● How Global issues like Brexit and the new USMCA trade agreement affect employment.

Chapter 1 ● How issues around sustainability are affecting companies.

Chapter Outline

The following outline organizes activities (including any existing discussion questions in PowerPoints or other supplements) and assessments by chapter (and therefore by topic), so that you can see how all the content relates to the topics covered in the text.

CO 1.1: Explain how human resource managers and other managers can have rewarding careers by helping their firms gain a sustainable competitive advantage through the strategic utilization of people.

1.1. Why Should You Study Human Resources Management? Will It Pay Off?

I. Having a good understanding of human resources management is important for managers and entrepreneurs of all types not just human resources (HR) personnel.

ll. All managers are responsible for some of the activities that fall into the category of management.

lll. Managers select employees, train and motivate them, appraise them, and promote them

lV. It’s a job that can be incredibly rewarding like a gardener helping the crops to grow.

1.1A. Human Capital and Organizational Culture

Figure 1.1

l. The idea that organizations ―compete through people‖ highlights the fact that achieving success depends on an organization’s ability to manage its human capital.

ll. To build human capital in organizations, managers must continue to develop superior knowledge, skills, and experience within their workforces and retain and promote top performers.

lll. Companies do ―win‖ because of the talent they find, hire, and manage

lV. Organizational culture affects how people in an organization work and treat each other and customers.

EOC (Optional) Discussion Question #1: 5 minutes total.

Discussion Activity 1

Are people always an organization’s most valuable asset? Why or why not?

Suppose your boss asked you to summarize the major people-related concerns related to opening an office in India. What issues would be on your list?

(Optional) Knowledge Check: <5 minutes total. Use Figure 1.1 to examine the framework of HRM. The box containing challenges can lead into the next section, which discusses challenges companies face

CO: 1.2: Explain how good human resource practices can help a firm address strategic challenges such as globalization, competition, and sustainability efforts.

1.2. Strategic and Global Challenges

l. When the global COVID-19 pandemic devastated economies, businesses, jobs, and families, the challenges of HRM took center stage.

ll. Never had senior leaders depended more on their HR colleagues to keep people safe, get them back to work, and help bolster the culture of collaboration and mutual support.

1.2A. Responding Strategically to Changes and Disruptions in the Marketplace

l. HR managers help their firms cope with ever-changing business conditions by helping redesign their firms to achieve agility

ll. Achieving agility often involves eliminating managerial layers that slow decisionmaking and make an organization less nimble

a. Human Resources Managers and Business Strategies

 Astute executives know that human resource professionals can help them improve, to comply with the law and help the bottom line by streamlining employment costs.

 Sometimes changing a firm’s strategy requires adjusting the composition of the work- force, Growth strategies often require increasing the size of the workforce. Transition or retrenchment strategies may involve reducing the workforce

 HR professionals can redesign work to foster innovation, forecast labor trends, recruit and motivate employees, and measure their effectiveness. HR managers also help their firms with business strategies

1.2B. Competing, Recruiting, and Staffing Globally

l. Importing and exporting goods and services is the easiest way to ―go global.‖

ll. The national identities of products are blurring.

lll. Free-trade agreements forged between nations have helped quicken the pace of globalization.

lV. GATT paved the way for the formation of many major trade agreements and

institutions, and these are continuously changing- The UK exited- ―Brexit‖-the European Union.

a. How Globalization Affects HRM

 Globalization has made firms balance issues related to different geographies, including different cultures, employment laws, business practices, and the safety of employees and facilities abroad.

 Human resource issues underlie each of these concerns.

 Relocating managers and training foreign managers to direct an international workforce often occurs through downsizing, outsourcing, and offshoring.

1.2C. Setting and Achieving Corporate Social Responsibility and Sustainability Goals

l. Globalization has led to an improvement in people’s living standards.

ll. Globalization stirs fierce debate especially when it comes to jobs.

lll. Issues have led to a new focus on corporate social responsibility, or good corporate citizenship.

lV. Corporate social responsibility is often framed within a larger context of sustainability.

V. Firms include environmental, social, and governance (ESG) criteria as part of sustainability.

EOC (Optional) Discussion Question #2: 5 minutes total.

Name a company you hope to work for someday. What is its track record in terms of corporate social responsibility and sustainability? Are these factors important to you? Why or why not?

CO: 1.3: Describe how technology can improve how people perform and how they are managed.

1.3. Technology Challenges

l. Advancements in technology have changed the business world cloud computing and social media are prime examples.

ll. The Covid-19 pandemic made web and videoconferencing applications like Zoom, Skype, and Microsoft Teams everyday necessities.

a. The Digitalization of Work: From Touch Labor to Knowledge Workers

 Automation has reduced the number of jobs that require routine tasks and little skill.

 Technology requires knowledge workers rather than touch workers. whose responsibilities include planning, decision-making, and problem-solving.

 Knowledge-based training includes massive open online courses (MOOCs) and virtual learning.

b Technology’s Effect on HRM

 A human resources information system (HRIS) provides data for control and decision-making before and after hiring employees.

 One of the newer HRIS applications is the use of big data, a buzzword that describes the massive amounts data available that can be ―crunched‖ to make decisions.

 Workforce (HR) analytics improve human resources management because a firm can do a better job with workforce planning.

 HRIS should provide HR personnel with analytical information statistics, metrics, and so forth that helps them analyze, refine, and better implement a firm’s strategic direction.

EOC (Optional) Discussion Question #3: 5 minutes total. Will technology eliminate the need for human resource managers?

CO: 1.4: Explain the dual goals HR managers have in terms of increasing productivity and controlling costs.

1.4. Productivity and Cost Challenges

l. Labor costs are often the largest expenditures companies make

ll. Employee productivity results from employees’ abilities, motivation, work environment, and technology

1.4A. Maximizing Productivity

l. Productivity is the output gained from a fixed amount of inputs.

ll. Organizations can increase productivity by reducing inputs (the cost approach)

lll. Alternatively, they can increase productivity by adding more human and/or physical capital to the process.

1.4B. Managing the Size of the Workforce

l. To manage productivity, match the size of the workforce to the demand, considering technology, the firm’s strategic direction, and global competition.

ll. Management methods include hiring additional personnel, offshoring, outsourcing, nearshoring, homeshoring, downsizing, and furloughing.

1.4C. Managing Pay and Benefits

l. Although firms closely monitor employee pay and benefit programs, health care costs are a major concern.

ll. Employee leasing and freelance employees can keep these costs down.

lll. In the gig economy, people earn income from various nonpermanent ―gigs,‖ or jobs, and work independently, rather than full time for an employer.

EOC (Optional) Discussion Question #4: 5 minutes total. Do cost-containment pressures work against the effective management of people? Why or why not?

CO: 1.5: Discuss how firms can leverage employee differences to their strategic advantage and how educational and cultural changes in the workforce are affecting how human resource managers engage employees.

1.5. Employee Challenges

l. In addition to strategic challenges, companies must attend to important employee concerns.

ll. Those challenges include job security, health care, diversity, and employee rights.

1.5A. Responding to the Demographic and Diversity Challenges of the Workforce

Figure 1.2

l. Figure 1.2 shows the U.S. labor force participation rate. The rate peaked in 2000 at about 67 percent; however, many people dropped out of the job market.

ll. By 2050, the U.S. Bureau of Labor Statistics (BLS) predicts the labor force participation rate will be about 60.2 percent.

Optional) Knowledge Check: <5 minutes total.

Use Figure 1.2 to examine the reasons workforce participation varies. What is the current trend in workforce participation? Ask students to consider the factors affecting it.

a. Ethnic and Racial Diversity in the Workforce

 Ethnic and racial diversity is growing in the workplace.

Figure 1.3

 Figure 1.3 shows the number of new temporary work visa approvals from 2010 to 2019.

 Some businesses, including those in the agricultural business, face labor shortages that would be even more severe without less-skilled immigrants willing to work for low pay and few or no benefits.

 In recent years, the federal government and state and local governments have made it harder for firms to hire undocumented workers.

(Optional) Knowledge Check: <5 minutes total.

Use Figure 1.3 to examine the growth of one ethnic group. Ask students how this affects the workforce.

b. Age Distribution of the Workforce

Figure 1.4

 The newest generation in the workplace is Generation Z, born in the mid-1990s and early 2000s.

 The millennial generation (Generation Y), with 75 to 80 million people, has a big impact on the labor market.

 Generation X, born between 1964 and 1979 are independent, like challenging work, and value job security.

 A significant proportion of babyboomers, (born between 1946 and 1964). have hit retirement age but not all are retiring.

 Older workers tend to be dependable and remain on the job longer than younger workers.

 Managers must figure out what drives each person to utilize talent and meet employment demands and career aspirations.

(Optional) Knowledge Check: <5 minutes total

Use Figure 1.4 to examine the effect of the changing age groups in the workforce. Ask students to compare how their parents approach a task to how they approach a task.

c Gender Distribution of the Workforce

 Women constitute a little under half of the U.S. workforce.

 60 percent of women 16 and older are in the labor force

 70 percent of mothers with school-age children are employed.

 Three of every five college graduates are women.

 Women’s wages have increased

 Women earn about 83 percent of what men employed full time earn.

 Top executive positions are still dominated by men (Optional) Knowledge Check: <5 minutes total

Figure 1.5

Use Figure 1.5 to examine gender trends in the workforce. Ask students who have work experience if they think they have been paid the same as others in the same job. Has gender affected their income?

1.5B. Educational Shifts Affecting the Workforce

Figure 1.6

l. Figure 1.6 shows that a college education results in higher wages and lower unemployment rates.

ll. Although the educational level of the labor force has risen, American students’ math and science test scores lag behind students in China, Japan, and other nations.

(Optional) Knowledge Check: <5 minutes total

Use Figure 1.6 to examine the education level and unemployment rate of U.S. workers. Ask students to describe how long current graduates seek a job and how long they expect to be unemployed after graduation

1.5C. Adapting to Cultural and Societal Changes Affecting the Workforce

l. Culture and society affect workers’ behavior on the job and the environment within the organization

ll. Culture and society influence workers’ reactions to assignments, leadership styles, and reward systems.

a. Changing Employee Rights

 Laws affecting employee rights are continually changing.

 Laws affecting companies today grant employees the right to equal employment opportunities, union representation, a safe and healthful work environment, unemployment and health care benefits, the regulation of pension plans, and equal pay for equal work

b. Privacy Concerns of Employees

 HR managers recognize the importance of discretion in handling information and data about employees.

 In addition to implementing privacy policies, most companies limit the use of social security numbers on employment forms.

 Globalization has added another twist to privacy compliance.

 Firms that have disciplined or fired employees for making disparaging remarks about their organizations on the Internet have found themselves sued.

c. Changing Attitudes Toward Work and How They Relate to Employee Engagement

 Though most people still enjoy work and want to excel, they focus on finding interesting work and often pursue multiple careers.

 Firms are rethinking what employee engagement means and how it can be achieved.

d. Balancing Work and Family

 Balancing work and family continues to be a major concern for firms and their employees.

 Competitive organizations find it advantageous to provide employees with more family-friendly options.

EOC (Optional) Discussion Question #5: 5 minutes total. What are the pros and cons of having a more diverse workforce? Is the United States in a better position to compete globally because of its diverse population?

CO: 1.6: Provide examples of the roles and competencies of today’s HR managers and their relationship with other managers.

1.6. The Role HR Managers Play and Their Partnership with Other Managers

Figure 1.7

l. Utilizing business statistics and surveys, HR managers can measure the engagement and effectiveness of their firms’ workforces.

ll. HR managers can help theirs firms choose the best strategies for competing globally, selecting human resource systems, maximizing productivity, and managing benefits

lll. HR managers serve as valuable partners to line managers.

1.6A. Responsibilities of Human Resource Managers

l. Responsibilities include:

 Strategic advice and counsel

 Service

 Policy formulation and implementation

 Employee advocacy.

1.6B. Competencies Human Resource Managers Require Figure 1.8

l. HR managers need:

 Leadership and navigation,

 Ethical practice

 Business acumen

 Relationship management

 Consultation

 Critical evaluation

 Global & cultural effectiveness

 Communication

 HR expertise.

EOC (Optional) Discussion Question #6: 5 minutes total. In your opinion, what is the most important role HR managers play?

(Optional) Knowledge Check: <5 minutes total. Use Figure 1.8 to discuss skills HR managers need. Ask students for examples of each skill.

Discussion Questions

You can assign these questions several ways: in a discussion forum in your LMS; as whole-class or break out discussions in person or synchronously via a virtual meeting tool like Zoom; or as a partner or group activity in class. For more best practices around the facilitation of discussion question in online courses, as well as other online teaching and learning tips, check out the Guide to Teaching Online, which can be found on the Instructor Companion Site.

1. Question: Are people always an organization’s most valuable asset? Why or why not? Suppose your boss asked you to summarize the major people-related concerns related to opening an office in India. What issues would be on your list?

Suggested Answer: Contrary to what many managers might say, people are not always an organization’s most important asset. In fact, many times managers adversely affect the impact employees can have on the organization (e.g., by designing jobs that don’t let individual talents show, by not giving employees input into decisions, and so on). Employees can be the most important asset and directly impact the competitiveness of an organization under certain circumstances. The most basic concerns about opening an office in another country include legal, cultural, and administrative differences. Students should be made aware of the options an organization has in terms of hiring people from the host country versus sending over expatriates. Depending on the people hired, training issues become important, as do issues related to pay, career development, and the like.

2. Question: Name a company you hope to work for someday. What is its track record in terms of corporate social responsibility and sustainability? Are these factors important to you? Why or why not?

Suggested Answer: Students’ answers will be based on their values and background. Some students may be more focused on day-to-day personal needs and others on broader societal or global concerns. In general, most students would prefer to work for a firm that does not have a bad reputation. The important thing is not the

answer, but the amount of thought put into it.

3. Question: Will technology eliminate the need for human resource managers?

Suggested Answer: Students’ answers will vary. Any answer is at least partially speculative Regardless of how students respond, it seems reasonable that, as long as an organization consists of human beings, HR functions need to be carried out by someone even if they are an additional duty for a person whose primary job is something other than HR.

4. Question: Do cost-containment pressures work against the effective management of people? Why or why not?

Suggested Answer: Students’ answers may vary. This is an interesting opinion question. Perhaps the class can be divided into discussion groups, who will report back to the class with their perspective. Most likely, the class will conclude that it is indeed possible to demoralize employees by cuts in pay and benefits or by creating schedules and working conditions that would normally be unacceptable. It is also possible that a group of people could experience those same problems and have high morale if they believe they are doing so for a worthy cause or that what they are enduring is only temporary and will result in a far better situation in the future.

5. Question: What are the pros and cons of having a more diverse workforce? Is the United States in a better position to compete globally because of its diverse population?

Suggested Answer: Students’ answers may vary. Probably most students will focus on the pros and say that the United States benefits from its diverse population. However, challenge the students to cover both sides. Those who suggest some cons will likely touch upon problems of communication and culture clash. Ask the students for ideas as to how such issues can be eliminated.

6. Question: In your opinion, what is the most important role HR managers play?

Suggested Answer: Students’ answers will vary. This question is meant to stimulate conversation about the complementary roles within HRM how they fit together and support the business. Without any one of the roles, the pyramid topples. In today’s organizations, personal credibility and/or ethics may be the most central role. Without it, nothing else much matters.

Additional Discussion Questions

The following is a discussion question that does not appear in the text, PPTs, or courseware (if courseware exists) – they are for you to use as you wish. You can assign this question several ways: in a discussion forum in your LMS; as whole-class discussions in person; or as a partner or group activity in class.

EOC (Optional) Additonal Discussion Question #1: 5 minutes total.

7. Question: When the global COVID-19 pandemic devastated economies, businesses, jobs, and families, what challenges did HRM face? Why did senior leaders depend upon their HR colleagues?

Suggested answer: Students’ answers will vary. COVID-19 highlighted the fact that organizations must adapt in order to capture opportunities and overcome domestic and global obstacles. During the pandemic, senior leaders depended upon HR colleagues to keep people safe, get them back to work, and help bolster the culture of collaboration and mutual support. Ask students for their ideas on how the pandemic might have been handled differently.

Additional Activity

The following activity was developed by Cengage but not included in the text, PPTs, or MindTap.

Internet Activity:

Fortune’s 100 Best Companies to Work For https://fortune.com/best-companies/2021/

1. Prolonged shutdowns. Workforces that felt isolated and overwhelmed. COVID brought it. Still, these companies managed not just to muddle through, but to become role models.

2. The takeaway seems clear: Businesses that treat employees well during the toughest of times will attract talent, even when the war for talent heats up. Here, the 100 hottest workplaces and how they stay that way.

3. Students can do internet research individually, in pairs, or as a presentation to the class in-person or on Zoom.

Case Study 1: New HR Strategy Makes Lloyd’s a “Best Company”

1. Question: What skills does Black think employees need, to work successfully in the area of HR?

Suggested answer: The case does not specify the skills that Black thinks the workforce in general needs to work successfully in HR; however, based on the focus of her efforts and on what she has indicated regarding the ideal characteristics of future HR professionals, several things are obvious. HR professionals need to develop certain attitudes and understanding and be able to focus. As she put it, ―They must understand change and transformation, excel at operations, and balance tactical and strategic thinking and acting. They will have to be able to manage and navigate organizational complexity and ambiguities and not be afraid to say no occasionally in order to establish appropriate boundaries with the business.‖ For the general workforce, their demonstration of the ability to respond positively to change was a plus for her and a characteristic that will need to be maintained and enhanced for the future.

2. Question: What are some of the outcomes of the company’s new HR strategy?

Suggested answer: Some of the outcomes of the company’s new HR strategy include not only a more positive internal organizational environment in which employees can function more effectively but also widespread publicity regarding that environment (the newspaper recognition of the firm as one of the ―Top 100 Best Companies to Work For‖) which makes it easier to attract valuable talent to the firm.

3. Question: What do you think might be some of the challenges of establishing HR policies for a global company?

Suggested answer: Some of the challenges of establishing HR policies for a global company include culture (along with religion), communication, laws, and economic systems. A policy that is viewed as desirable in one country might be viewed as evil in another. Language barriers and subtleties in the way information is presented create the risk of misunderstanding. Laws in some countries might prohibit certain policies. The economic system and related values might make it difficult to implement some policies. Encourage students to add to this list and suggest specific applications.

4. Question: What types of situations do you think might require an HR manager to say ―no‖?

Suggested answer: Situations that might require an HR manager to say ―no‖ could involve almost any HR policy or objective that might pay off for the firm but not for a given person, department, or team. Black spoke of the need to say no in order to establish appropriate boundaries without specifying what those boundaries might be. For example, the manager of a given department has a vision of what he or she wishes to accomplish. He or she may wish to be given priority regarding new hires who have certain skills, but HR might be obligated to make those hires available to other parts of the firm where they can be used to greater advantage. Ask students to give examples

of instances in which a manager must avoid pleasing everyone if he or she is to be successful.

Case Study 2: Shell’s Top Recruiter Takes His Cues from Marketing

1. Question: What functions of HRM are similar to marketing functions? How can thinking about ―marketing‖ a company’s jobs improve the strategic focus of human resources personnel?

Suggested answer: Recruitment, by its very nature, involves marketing. Firms that have an abundance of highly qualified applicants trying to sell themselves in pursuit of a limited number of jobs do not need to recruit. However, marketing not only seeks to sell something to a customer but also to do so in a way that will result in a delighted customer one who will be satisfied with the product or service. Effective recruiting needs to do the same. Recruiting needs to result in an employee who will enthusiastically blend into the firm. In addition to recruiting, training will be more effective if it is ―sold‖ to the trainees. Implementation of various HR policies will be more successful if employees implement them because they want to do so not just because they must comply.

2. Question: If you were planning to use marketing strategies to ―brand‖ a company as an employer of choice, what are some of the factors you would consider?

Suggested answer: Students’ answers will vary. However, some may say that to become an employer of choice a firm needs to understand the needs and values of the type of employees the firm seeks to attract their age, educational level, values, etc. For instance, it might be difficult for an oil company to attract candidates who believe that the petroleum industry is a primary cause of global warming, but positioning the firm as one that is acting to reduce any negative effects might help it recruit successfully. There is no correct answer to the question the important thing is the thought put into the answer.

3. Question: Do you agree with Singh’s statement that in the future, companies will have to apply for skilled people to work for them rather than candidates applying to work at an organization? Why or why not?

Suggested answer: Students’ answers will vary. Depending on the size of the class, instructors might divide the class into two debate teams to discuss the question. The correctness of the statement may depend on the industry and the growth rate in that industry. To the extent that industries grow at a faster pace than the growth in the number of qualified applicants, Singh may be prophetic.

Instructor Manual: Snell/Morris, Managing Human Resources 19e, c23, ISBN: 9780357716519; Chapter #1: The Opportunities and Challenges of Human Resources Management

Additional Resources

Cengage Video Resources

 MindTap Videos:

o Chapter 01: Concept Clip: People Power

o Chapter 01: On The Job: Barcelona Restaurant Group: Managing Human Resources

Instructor Manual: Snell/Morris, Managing Human Resources 19e, c23, ISBN: 9780357716519; Chapter #1: The Opportunities and Challenges of Human Resources Management

Chapter 02: Strategy and Human Resource Planning Instructor Manual

Snell/Morris, Managing Human Resources 19e, c23, ISBN: 9780357716519; Chapter #2: Strategy and Human Resource Planning

Table of Contents

Purpose and Perspective of the Chapter 18

Chapter Objectives 18

Key Terms 18

New in This Chapter 20

Outline 20

Purpose and Perspective of the Chapter

Strategic human resources management (SHRM) integrates strategic planning and HR planning. It can be thought of as the pattern of human resource deployments and activities that enable an organization to achieve its strategic goals. The firm’s mission, vision, and values provide a perspective on where the company is headed and what the organization can become in the future. They clarify the long-term direction of the company and its strategic intent. Analyzing the firm’s external environment is central to strategic planning. Benchmarking is the process of looking at your practices and performance and then comparing them to those of your competitors. Environmental scanning is the systematic monitoring of major external forces influencing the organization, including forces in the business environment and the competitive environment. Conducting an internal analysis to gauge the firm’s strengths and weaknesses involves looking at a firm’s core capabilities, its talent and composition in the firm, and the firm’s corporate culture. After managers have analyzed the internal strengths and weaknesses of the firm, as well as external opportunities and threats, they have the information to formulate corporate, business, and HR strategies which must be executed. To evaluate their performance, firms need to establish a set of ―desired‖ objectives as well as the metrics to monitor how well their organizations delivered against those objectives.

Chapter Objectives

The following objectives are addressed in this chapter:

1. Explain how human resource planning and a firm’s mission, vision, and values are integrally linked to its strategy.

2. Describe how an organization’s external environment influences its strategic planning.

3. Summarize why it is important for an organization to do an internal resource analysis.

4. Explain the linkages between competitive strategies and HR.

5. Classify what is required for a firm to successfully execute a strategy and assess its effectiveness.

6. Describe how firms evaluate their strategies and HR execution.

Key Terms

Balanced scorecard (BSC): a framework that helps managers translate their firms’ strategic goals into operational objectives.

Benchmarking: the process of looking at your practices and performance in a given area and then comparing them with those of other companies

Business environment: all of the external factors in the general environment factors a firm cannot directly control but that can affect its strategy

Competitive environment: a firm’s specific industry, including the industry’s customers, rival firms, new entrants, substitutes, and suppliers

Core capabilities: abilities that distinguish an organization from its competitors and create value to customers

Core values: the strong enduring beliefs and principles that guide a firm’s decisions and are the foundation of its corporate culture

Cultural audits: to examine values, attitudes, beliefs, and expectations.

Environmental scanning: the systematic monitoring of major external forces influencing the organization, including forces in the business environment which is sometimes called the remote environment and the competitive environment

Human capital readiness: any difference between the quantity and quality of employees required versus the quantity and quality of employees available represents a gap that needs to be fixed.

Human resources planning (HRP): the process of anticipating and providing for the movement of people into, within, and out of an organization.

Management forecasts: based on the judgments of experts, supervisors, department managers, or others knowledgeable about the organization’s future employment needs.

Markov analysis: shows the percentage and actual number of employees who remain in each of a firm’s jobs from year to year and the proportions of those promoted, demoted, transferred, or who have quit.

Mission: the basic purpose of the organization, as well as its scope of operations.

Quality of fill: developed because managers understand that simply having ―bodies‖ in place is not enough.

Replacement charts: list current jobholders and identify possible replacements should openings occur

Skill inventories: prepared either manually or using a human resources information system that lists each employee’s education, past work experience, vocational interests, specific abilities and skills, compensation history, and job tenure.

Staffing tables: show firm’s jobs, along with the numbers of employees currently occupying those jobs (and perhaps future employment requirements derived from demand forecasts).

Stakeholders strategic: key people and groups that have an interest in a firm’s activities and can either affect them or be affected by them.

Strategic Human resources management: combines strategic planning and HR planning.

Strategic planning: a set of procedures for making decisions about the organization’s longterm goals and ways to achieve those goals..

Strategic vision: moves beyond the mission statement to provide a perspective on where the company is headed and what the organization can become in the future.

Succession planning: the process of identifying, developing, and tracking talented individuals so that they can eventually assume top-level positions

SWOT analysis: a simple way to summarize the major facts and forecasts derived from external and internal analyses

Talent reviews: strategic meetings to determine if a company has the human resources it needs to compete in the future

Trend analysis: plots a historical trend of a business factor, such as sales, in relation to the number of employees

Value creation: a cost-benefit scenario: value = benefits – costs.

What's New in This Chapter

The following elements are improvements in this chapter from the previous edition:

Chapter # New component(s)

Chapter 2 ● How companies like Marriott are changing their HR strategy for a changed global environment.

Chapter 2 ● New examples from new industries.

Chapter 2 ● How companies have changed the people management strategies due to the global Covid-19 pandemic.

Chapter 2 ● How strategy is no longer about competition but about collaboration.

Chapter Outline

The following outline organizes activities (including any existing discussion questions in PowerPoints or other supplements) and assessments by chapter (and therefore by topic), so that you can see how all the content relates to the topics covered in the text

CO 2.1: Explain how human resource planning and a firm’s mission, vision, and values are integrally linked to its strategy.

2.1. Strategic Planning and Human Resource Planning

l. ―Competing through people‖ is a theme for this book. But the idea remains only a premise for action until put it into practice.

ll. Strategic planning focuses on how the organization will position itself relative to its competitors, to ensure its long-term survival, create value, and grow.

lll. Human resource planning (HRP helps managers deploy human resources effectively, where and when they are needed, to accomplish the organization’s goals.

lV. Strategic human resource management is the pattern of human resource activities and investments that enable an organization to achieve its strategic goals.

EOC (Optional) Discussion Question #1: 5 minutes total.

Discussion Activity 1

Identify the three key elements of the human resources planning model and discuss the relationships among them.

2.1A: Strategic Planning and HR Planning: Linking the Processes Figure. 2.1

l. HR managers consider human resources planning and strategic planning together.

 Human resources planning provides a set of inputs into the strategic formulation process by determining whether a firm has the types and numbers of people available to pursue a given strategy.

 In strategy implementation, the company’s executives must make resource allocation decisions to implement strategy, including decisions related to the firm’s structure, processes, and human capital.

(Optional) Knowledge Check: <5 minutes total Use Figure 2.1 to discuss the connection between strategic planning and HR planning. Discuss other activities that require planning such as going on vacation, making a major purchase, and earning a college degree. This figure also serves as a map of this chapter.

2.2. Step One: Mission, Vision, and Values

l. The first step in strategic planning in a firm is establishing a mission, vision, and values for the organization.

ll. Although the terms mission and vision often are used interchangeably, the vision statement clarifies the long-term direction of the company and its strategic intent.

2-2A. Developing a Mission Statement

l. A manager or business owner can craft a mission statement by asking basic questions about the firm, its purpose, its customers, and its value

2.2B. HR’s Role in Establishing and Reinforcing a Firm’s Mission, Vision, and Values

l. HR managers help embody the firm’s mission, vision, and values within the organization by what they say and what they do.

 Communicating them frequently, both informally and formally,

 Recruiting and hiring employees whose values are consistent with the organization.

 Translating the mission, vision, and values into job descriptions and specific behaviors

CO 2.2: Describe how an organization’s external environment influences its strategic planning.

2-3. Step Two: External Analysis

l. A SWOT analysis (strengths, weaknesses, opportunities, and threats) is a way to summarize the major facts and forecasts derived from external and internal analyses.

ll. Environmental scanning monitors major external forces influencing the organization, forces in both the business and competitive environments

lll. By continuously scanning the environment for changes, managers can anticipate their

impact

2-3A. The Business Environment

l. A firm’s business environment includes factors in the external environment that affect strategy and performance:

 economic changes (booms and recessions)

 ecological changes (climate change)

 technological changes (automation and Internet)

 demographic and social changes

 legal and regulatory changes (laws and administrative rulings)

2.3B. The Competitive Environment Figure 2.2

l. The competitive environment consists of a firm’s specific industry

ll. The following factors affect the competitive environment:

 customers (create value customers want)

 rival firms (know the competition)

 new entrants (establish entry barriers)

 substitutes (adjust employee skill bases)

 suppliers (key inputs are raw materials, money, information, and people)

lll. The more power each factor has, the less profitable the industry will be.

EOC (Optional) Discussion Question #2: 5 minutes total.

Discussion Activity 1

What external forces influence a firm’s strategy?

(Optional) Knowledge Check: <5 minutes total.

Use Figure 2.2 to discuss the five forces framework. Ask students to identify a local business and identify how the five forces affect it.

lV. Stakeholders are people and groups with either a direct stake in the firm or those who affect or are affected by the company. Figure 2.3.

(Optional) Knowledge Check: <5 minutes total.

Use Figure 2.3 to discuss the difference between primary and secondary stakeholders. What happens if primary stakeholders don’t want to be involved or secondary stakeholders want to be too involved?

2-3C. HR’s External Analysis Figure 2-4

l. Firms evaluate themselves against other firms.

ll. Benchmarking is a look at other companies using:

 unemployment rates

 labor force projection figures

 population characteristics (U.S. Department of Labor)

 hiring and recruiting metrics

 informal media (blogs, press releases, etc.)

(Optional) Knowledge Check: <5 minutes total.

Use Figure 2.4 to discuss the information that can be collected and how it is used.

CO 2.3: Summarize why it is important for an organization to do an internal resource analysis.

2.4. Step Three: Internal Analysis

l. Organizations analyze their strengths and weaknesses.

ll. They compare these with external opportunities and threats.

2.4A. Core Capabilities

l. Many experts argue that the key to a firm’s success is based on core capabilities abilities that distinguish an organization.

ll. Value creation is a cost-benefit scenario. value = benefits – costs. Why does a customer buy from you?

lll. Core capabilities consist of:

 processes (standard routines for how work will be done),

 systems (technologies)

 people

2.4B. Sustaining a Competitive Advantage Through People

l. Organizations achieve a sustained competitive advantage through resources if they are:

 valuable

 rare

 difficult to imitate

 organized

EOC (Optional) Discussion Question #3: 5 minutes total.

Discussion Activity 2

What criteria must be met if firms are to achieve a competitive advantage through their employees?

2.4C. Types of Talent and Their Composition in the Workforce Figure 2.5

l. Skill groups classified according to strategic value creation and uniqueness.

 Strategic knowledge workers (unique skills linked to strategy that are difficult to replace sales and finance)

 Core employees (valuable skills that are not unique customer service and quality control)

 Supporting workers (less central skills that are generally available distribution and manufacturing)

 Complementary (external) partners (external workers with unique skills not related to the company’s core strategy management, R&D partners, and legal) (Optional) Knowledge Check: <5 minutes total.

Use Figure 2.5 to discuss the types of workers and examples of each type.

Ask students which job tasks that might be unique and valuable but not unique, and generally available.

2.4D. Corporate Culture Figure 2.6

l. Cultural audits of the culture and quality of work life in an organization help firms decide upon strategic investments and maneuvers.

ll. A firm asks its employees their opinions about several issues.

a. Conducting a Cultural Audit-employees can be surveyed about:

 company’s norms

 values, relationships

 leadership style

 communication practices

 recruitment and evaluation practices

 measurements

 pay and benefit programs

lll. Cultural audits determine whether there are subcultures that have different views about the work and how it should be done.

2.4E. Forecasting Figure 2.6

l. Managers focus on forecasting at least three key elements:

 the demand for labor

 the supply of labor

 balancing supply and demand considerations. (Optional) Knowledge Check: <5 minutes total.

Figure 2.6 will be useful to initiate a classroom discussion on forecasting.

What techniques and considerations are involved when forecasting supply

and demand? Ask students to evaluate supply and demand for different jobs.

a. Forecasting a Firm’s Demand for Employees-two approaches Figure 2.7

The two approaches to HR forecasting are quantitative and qualitative.

 Quantitative approaches: statistical or mathematical techniques. Trend analysis forecasts demand based on a factor such as sales.

 Qualitative approaches: less statistical. Management forecasts: opinions about the future employment needs.

b. Staffing Tables and Markov Analyses.

 A Staffing table shows a firm’s jobs, and the numbers of employees occupying them

 Markov analysis shows the percentage and actual number of employees remaining in each job and the proportions of those promoted, demoted, transferred, or who have quit.

 Markov analysis tracks employee movements through various jobs to develop a matrix for forecasting labor supply

 Quality-of-fill metric measures how well new hires perform have enough top performers to reach strategic objectives.

(Optional) Knowledge Check: <5 minutes total.

Use Figure 2.7 to discuss the Markov analysis method. Ask students to suggest the advantages and disadvantages of using only Markov analysis. It is based on actual data, but it doesn’t consider management’s experience to evaluate the data.

c. Skill Inventories and Management Inventories.

 Skill inventories match job openings with employee backgrounds.

 When data are gathered on managers, inventories are called management inventories.

d Replacement Charts and Succession Planning. Figure 2.8

 Replacement charts provide information on the current performance and promotability of possible replacements.

 Succession planning: identifies, develops, and tracks talented individuals to assume top-level positions

2.4F. Assessing a Firm’s Human Capital Readiness: Gap Analysis Figure 2.9

l. When a company assesses supply and demand for employee talent, it understands human capital readiness.

ll. A difference between the quantity and quality of employees required versus the quantity and quality of employees available equals a gap.

(Optional) Knowledge Check: <5 minutes total.

Use Figure 2.9 to discuss the assessment of human capital readiness and how it is used. The example demonstrates the information considered when assessing readiness

CO 2.4: Explain the linkages between competitive strategies and HR

2.5. Step Four: Formulating a Strategy Figure 2.10

l. A SWOT analysis helps a company move from formulating a strategy to:

 devising a plan

 capitalizing on opportunities

 counteracting on threats

 alleviating internal weaknesses.

(Optional) Knowledge Check: <5 minutes total.

Figure 2.10 is an example of a SWOT analysis done for the women’s clothing brand Liz Claiborne. Use the information to discuss the process of creating a corporate strategy from a SWOT analysis

2.5A. Corporate Strategy

l. A firm’s corporate strategy addresses the following questions Figure 2.10

 ―where‖ we should compete

 the markets and business segments

 customers, partners and competitors

a. Growth and Diversification

 Companies formulate geographic, volume, and product-expansion strategies.

 HR planning is vital because growth requires:

o increased employee productivity

o a greater number of employees

o employees developing or acquiring new skills.

b. Mergers and Acquisitions

 Merging companies streamline r costs by eliminating duplicate functions

 Failures result from cultural inconsistencies and conflicts

c. Strategic Alliances and Joint Ventures

 In a strategic alliance or joint venture. HR:

o assesses culture compatibility

o identifies potential problems

o selects key executives

o develops teamwork

o designs performance assessment and mutual incentives

2.5B. Business Strategy

l. Business strategy is focused on how the company will compete to create value for

customers.

a. Low-Cost Strategy: Compete on Productivity and Efficiency

 Keeps costs low enough to offer an attractive price relative to competitors

 Focus: efficiency, productivity, and minimizing waste.

 HR planning:

o Increases productivity.

o Outsources to companies that perform activities or services at a lower cost.

b. Differentiation Strategy: Compete on Unique Value Added

 Compete by providing something unique and distinctive to customers.

 Based on delivering:

o high-quality products

o innovative features

o speed to market

o superior service

2.5C. HR Strategy

l. HR strategy must focus on all its workers and how they mesh.

ll. HR managers should analyze subcultures to ensure that they work together

lll. HR and line managers must plan to facilitate the firm’s competencies and drive strategies forward.

(Optional) Knowledge Check: <5 minutes total. Explain the difference between a firm’s corporate strategy and business strategy.

Why do firms need to look at both aspects?

C0 2.5: Classify what is required for a firm to successfully execute a strategy and assess its effectiveness.

2.6. Step Five: Executing a Firm’s Strategy

l. Strategy execution, not the strategy itself, determines a firm’s success.

ll. The ―4As‖ are required for successful strategy execution:

 Alignment (shared performance expectations and accountability)

 Agility (proactive in the face of change)

 Architecture (structures, processes, and systems)

 Ability (talent capacity)

(Optional) Knowledge Check: <5 minutes total.

Figure 2.11

Use Figure 2.11 to discuss the 4As framework of execution capability. Ask students what happens if one of these requirements is missing

2.6A. HR’s Role in Strategy Execution

l. Managers translate strategic priorities into functional areas of the organization.

ll. Human resources management is instrumental to almost every aspect of strategy execution.

a. Remaining Agile achieved in two ways:

 Coordination agility (ability to rapidly reallocate resources to new or changing needs)

 Resource agility (resources used in different ways and people who perform different functions in different ways)

b. Reconciling Supply and Demand

 Demand for a firm’s products is based on business forecasts.

 Supply considerations involve filling vacancies to meet the demand for products.

 Organizations can hire, outsource, and lay off employees or adjust hours.

EOC (Optional) Discussion Question #5: 5 minutes total.

Discussion Activity 4

Why is it often difficult for a firm to match its strategy to HR deliverables?

CO 2.6: Describe how firms evaluate their strategies and HR execution

2.7. Step Six: Evaluation

l. Reevaluation and assessment are important for business.

ll. To evaluate their performance, firms need objectives and metrics.

EOC (Optional) Discussion Question #6: 5 minutes total.

Discussion Activity 5

What steps does the firm need to take to execute its strategy and measure the results?

2.7A. Evaluating a Firm’s Strategic Alignment

l. HR and the organization’s strategy must be aligned.

ll. Fit can be vertical or horizontal.

a. Vertical Fit/Alignment

 Vertical fit (or vertical alignment) focuses on the alignment of business objectives with the major initiatives undertaken by HR.

 Capabilities must be aligned with its value proposition.

b. Horizontal Fit/Alignment Figure 2.12

 HR practices should be aligned internally to be mutually reinforcing.

 All HR’s practices must focus on the same objectives.

(Optional) Knowledge Check: <5 minutes total.

Use Figure 1.12 to discuss horizontal alignment. Ask students which elements

might need to be adjusted

c. Strategic Alignment and the Balanced Scorecard

Figure 2.13

 A balanced scorecard ((BSC) helps managers translate strategic goals into operational objectives.

 The model uses four related fields:

o Financial

o Customer

o Processes

o Learning

(Optional) Knowledge Check: <5 minutes total.

Use Figure 2.13 to discuss balance scorecards. Ask students how the fields are related.

Discussion Questions

You can assign these questions several ways: in a discussion forum in your LMS; as whole-class or break out discussions in person or synchronously via a virtual meeting tool like Zoom; or as a partner or group activity in class. For more best practices around the facilitation of discussion question in online courses, as well as other online teaching and learning tips, check out the Guide to Teaching Online, which can be found on the Instructor Companion Site.

1. Question: Identify the three key elements of the human resources planning model and discuss the relationships among them.

Suggested answer: Managers focus on (at least) three key elements: (1) forecasting the demand for labor, (2) forecasting the supply of labor, and (3) balancing supply and demand considerations. Employment forecasting estimates the numbers and types of people needed to meet organizational objectives. Supply analysis then determines if the numbers and types of people needed are available either externally or internally. The final step in HRP is to balance the required number of employees with those available. If inconsistencies exist, changes in the staffing requirements or firm’s strategy may be needed

2. Question: What external forces influence a firm’s strategy?

Suggested answer: The external forces that influence a firm’s strategy are customers, rival firms, new entrants, substitutes, and suppliers, as outlined in Figure 2.2.

3. Question: What criteria must be met if firms are to achieve a competitive advantage through their employees?

Suggested answer: The human capital must be valuable, rare, difficult to imitate, and organized in a way that enables their talents to be combined and deployed to work on new assignments at a moment’s notice.

4. Question: Explain the difference between a firm’s corporate strategy and business strategy. Why do firms need to look at both aspects?

Suggested answer: While we think about corporate strategy as domain selection, business strategy is viewed in terms of domain navigation. It is more focused on how the company will compete against rival firms to create value for customers. A firm’s HR strategy must work in tandem with its corporate and business strategies. Getting the right number and kinds of people in the right places at the right times doing things that benefit them and the firm is no small task. Therefore, both strategic focuses need to be honed.

5. Question: Why is it often difficult for a firm to match its strategy to HR deliverables?

Suggested answer: Strategy alone does not differentiate high- from low-performing firms. The true differentiator between winners and losers turns out to be, not what their strategies were, but how well the strategy was executed. The 4As alignment, agility, architecture, and ability are required to successfully execute a strategy.

6. Question: What steps does the firm need to take to execute its strategy and measure the results?

Suggested answer: HR managers first gauge demand based on forecasted trends in business activity using both quantitative and qualitative methods. The Monthly Labor Review and Occupational Outlook Handbook, published by the Bureau of Labor Statistics (BLS) of the U.S. Department of Labor, as well as local chambers of commerce and individual state development and planning agencies compile labor market analyses (quantitative). The firm’s functional managers should also provide a qualitative assessment of the labor supply the firm will need. This involves both tracking current staffing levels and making projections about the levels the firm will have to compete strategically in the future. Tools like staffing tables, Markov analysis, skills inventories, replacement charts, and succession planning charts can help managers with this process. Balancing the two labor supply and demand then requires HR managers to take action either by actively recruiting full- or part-time employees with the skills the firm believes it will need, hiring temporary employees, trimming back employees via attrition or downsizing, or outsourcing and offshoring employees.

Additional Discussion Questions

The following are discussion questions that do not appear in the text, PPTs, or courseware (if courseware exists) – they are for you to use as you wish. You can assign these questions several

ways: in a discussion forum in your LMS; as whole-class discussions in person; or as a partner or group activity in class.

EOC (Optional) Additonal Discussion Question #1: 5 minutes total.

7 Question: How does human resources planning assist a firm like Walmart in its domestic and global operations?

Suggested answer: Human resource planning provides inputs into the strategic formulation process in terms of what is possible, that is, whether a firm has the types and numbers of people available to pursue a given strategy. When Walmart executives contemplated the move into web-based commerce to compete with Amazon, one of the issues they had to address was whether they had the talent needed to succeed in that arena. Walmart had to go through the same exercise again prior to launching its business in India. Walmart is committed to a future where retail in India is a mix of shopping experiences that best serve Indian consumers, suppliers, producers, and retailers. Walmart is building out a holistic ecosystem that includes a wholesale cashand-carry business, eCommerce platforms, a payments and financial services platform, as well as logistics and supply chain capabilities strong local businesses that are powered by Walmart. Walmart invests in programs and initiatives that help local sellers and suppliers farmers, artisans, and women-owned businesses (Retrieved on Sept. 20, 2021 from: https://corporate.walmart.com/our-story/our-business/international/walmart-india)

Additional Activity

The Balanced Scorecard

The BSC, Figure 2.12, is a framework that translates strategic goals into operational objectives. The model has four related cells: (1) financial, (2) customer, (3) processes, and (4) learning. BSC is rooted in human resources management. People management and learning help organizations improve their internal capabilities in product development and service which lead to customer satisfaction and loyalty. They ensure productivity and contain costs for better financial performance. Customer value creation, in turn, drives up revenues, which enhances profitability. Figure 2.13 shows a BSC at Starbucks. In each cell, Starbucks would identify the key metrics that help translate strategic goals to operational imperatives. Students, individually or in small groups will develop a BSC for a real or fictitious company. They will share their results with the class.

Case Study 1: How a Strategy Change Led to Nike’s Formation

1. Question: Who is ultimately responsible for formulating a firm’s strategy its managers, employees, or both?

Suggested answer: Management is ultimately responsible for formulating strategy, but they use input from employees. Therefore, students could argue that both are responsible.

2. Question: What strategy execution problems do you think Knight and Bowerman might have faced in their effort to make Nike successful?

Suggested answer: Students could suggest a variety of problems, such as the lack of financial resources, finding a manufacturer, and making Onitsuka into a rival.

Case Study 2: Domino’s Tries to Get Its Strategic Recipe Right

1. Question: Explain how Domino’s strategy differed from its competitors.

Suggested answer: Domino’s was able to offer a different value proposition than anyone else was offering as well as align its people, processes, and systems to ―deliver‖ against that promise. This is unlike anything else offered by any other company. For this reason, Domino’s was able to set itself apart from its competition.

2. Question: Has the firm been able to achieve a long-term strategic fit between its strategy and HR practices in your opinion? Why or why not?

Suggested answer: Yes, Domino’s approach is working as the turnover has dropped and customer satisfaction has increased. This is because Domino’s invested in training and retaining good store managers who were able to motivate their team and produce good results. Additionally, Domino’s was able to create a new value proposition for its food, for example, introducing a wide variety of new products.

Additional Resources

Cengage Video Resources

 MindTap Videos:

o Chapter 02: On The Job: Ocean House- HR Business Strategy

Chapter 03: Equal Employment Opportunity and Human Resources Management

Purpose and Perspective of the Chapter

When managers ignore or are unaware of fair employment laws, they and their firms run the risk of costly and time-consuming litigation, negative public attention, potentially lower sales, lower employee morale, and even damage to their own individual careers. Because even unintentional discrimination can be illegal, supervisors need to be aware of their personal biases and how they can affect their dealings with their subordinates. Employment discrimination is not only a legal issue, but also an emotional one. It concerns all individuals, regardless of their gender, race, religion, age, national origin, color, sexual orientation, physical condition, and position in an organization. Fortunately, it is a problem that can be minimized with good HR practices. This chapter will help you better understand how to minimize employment discrimination and will also discuss the diversity efforts companies are actively pursuing as a way to gain a strategic edge.

Chapter Objectives

The following objectives are addressed in this chapter:

1. Identify the three factors that influence EEO legislation.

2. Determine how the major equal employment opportunity (EEO) laws related to age, gender, religion, disability, weight, sexual orientation, and genetic information affect you and others within companies.

3. Demonstrate how to prevent other forms of discrimination that are of particular interest to managers.

4. Explain how the Uniform Guidelines on Employee Selection Procedures are used by firms and how they relate to the issues of adverse impact and disparate treatment.

5. Describe how Equal Employment Opportunity recordkeeping and posting requirements work, including how discrimination charges are processed by the EEOC.

6. Explain what affirmative action is and how companies today are seeing the value of voluntarily having diverse workforces.

Key Terms

Adverse impact: A concept that refers to the rejection of a significantly higher percentage of a protected class for employment, placement, or promotion when compared with the successful, non-protected class.

Affirmative action: A policy that goes beyond equal employment opportunity by requiring organizations to comply with the law and correct any past discriminatory practices by increasing the numbers of underrepresented groups in specific positions.

Bona fide occupational qualification (BFOQ): Suitable defense against a discrimination charge only when age, religion, sex, or national origin is an actual qualification for performing the job.

Business necessity: A work-related practice that is necessary to the safe and efficient operation of an organization.

Charge form: A discrimination complaint filed with the EEOC by employees or job applicants

Chief diversity officer (CDO): A top executive responsible for implementing a firm‘s diversity efforts.

Disabled individual: Any person who (1) has a physical or mental impairment that substantially limits one or more of the person‘s major life activities, (2) has a record of such impairment, or (3) is regarded as having such an impairment.

Disparate treatment: A situation in which protected class members receive unequal treatment or are evaluated by different standards.

Equal employment opportunity: The treatment of individuals in all aspects of employment hiring, promotion, training, etc. in a fair and nonbiased manner.

Equal Employment Opportunity Commission (EEOC): The EEOC‘s work consists of formulating EEO policy and approving all litigation involved in maintaining equal employment opportunity.

Fair employment practices (FEPs): State and local laws governing equal employment opportunity that are often more comprehensive than federal laws and apply to small-business employers.

Four-fifths rule: A rule of thumb followed by the EEOC in determining adverse impact for use in enforcement proceedings.

Protected classes: Individuals of an underrepresented race, women, older people, and individuals with disabilities who are covered by federal laws on equal employment opportunity.

Reasonable accommodation: An attempt by employers to adjust, without undue hardship the working conditions or schedules of employees with disabilities or religious preferences.

Reverse discrimination: The act of giving preference to members of protected classes to the extent that unprotected individuals believe they are suffering discrimination

Sexual harassment: Unwelcome advances, requests for sexual favors, and other verbal or physical conduct of a sexual nature in the working environment.

Uniform Guidelines on Employee Selection Procedures: A procedural document published in the Federal Register to help employers comply with federal regulations against discriminatory actions.

Workforce utilization analysis: A process of classifying protected-class members by number and by the type of job they hold within the organization.

What's New in This Chapter

The following elements are improvements in this chapter from the previous edition: Chapter # New component(s)

Chapter 3 ● A look at discrimination due to race-based natural hair and hairstyles.

Chapter 3 ● A discussion of how the #MeToo movement changed the perception and dealings of sexual harassment.

Chapter 3 ● New research about companies' efforts amidst the Black Lives Matter movement.

Chapter 3 ● Steps to increase diversity in your workplace.

Chapter 3 ● The transgender individuals ban from the military service has been lifted.

Chapter 3 ● New legal interpretations on what reasonable accommodation means for employees with disabilities.

Chapter 3 ● Updated information on how Title VII is being interpreted to prohibit discrimination based on gender identity or sexual orientation.

Chapter Outline

The following outline organizes activities (including any existing discussion questions in PowerPoints or other supplements) and assessments by chapter (and therefore by topic), so that you can see how all the content relates to the topics covered in the text

CO 3.1: Identify the three factors that influence EEO legislation.

3.1. Historical Perspective of EEO Legislation

l. Three factors have influenced the growth of EEO legislation:

 changing attitudes toward employment discrimination

 reports highlighting the economic problems and injustices experienced by underrepresented workers

Figure 3.1

 a growing body of disparate discrimination laws and regulations that legislators feel should be standardized

3.1A. Changing National Values

l. Individual merit, hard work, and equality are American values reinforced by laws. Regardless, discrimination persists.

3.1B. Early Legal Developments

l. Several pieces of legislation address discrimination.

 Civil Rights Act (1866) race discrimination

 Unemployment Relief Act (1933) race, color, or creed

 Executive Order 8802 (1941) race, creed, color, or national origin

ll. The legislation was not effective for several reasons:

 No enforcement powers were given to agencies.

 Discriminatory practices or methods needing correction were not specified

 Employers were not required to comply.

CO 3.2: Determine how the major equal employment opportunity (EEO) laws related to age, gender, religion, disability, weight, sexual orientation, and genetic information affect you and others within companies.

3.2. Government Regulation of Equal Employment Opportunity Figure 3.2 (Optional) Knowledge Check: <5 minutes total.

Use Figure 3.2 to discuss illegal discriminatory practices. Ask students for examples

3.2A. Major Federal Laws

3.3

l. Major federal EEO laws have been enacted to prevent discrimination against groups of workers most often affected by unfair employment practices.

ll. These groups are referred to as protected classes.

lll. Figure 3.4 lists the major and separate federal laws and their provisions governing equal employment opportunity.

a. Equal Pay Act of 1963

 The Equal Pay Act makes it illegal to discriminate in pay, benefits, and pension based on gender when employees do equal work

b. Amendments to the Civil Rights Act of 1964 Figure 3.4

 The Civil Rights Act of 1964 is a landmark law that addresses discrimination in society.

c. Bona Fide Occupational Qualification.

 Employers are permitted limited exemptions from antidiscrimination regulations if preferences are based on a bona fide occupational qualification.

 BFOQ is a defense against discrimination when age, religion, gender, or national origin is a qualification for the job.

d. Religious Preference.

3.5

Figure

 Title VII of the Civil Rights Act prohibits discrimination based on a person’s religion.

e. Equal Employment Opportunity Act of 1972.

 Two changes: Coverage includes state and local governments and public and private educational institutions; the law allowed the agency to sue employers.

f. Civil Rights Act of 1991.

 Employees who can prove intentional discrimination can seek compensatory monetary damage

g. Glass Ceiling Act of 1991

 A commission reported on the obstacles faced by underrepresented groups which strive for top-level management jobs.

h. Lilly Ledbetter Fair Pay Act (2009)

 Employees can claim discrimination after years of getting unfair pay and demand to be compensated for the lost wages.

i. Age Discrimination in Employment Act of 1967

 The (ADEA) prohibits specific employers from discriminating against employees and applicants age 40 or older.

j. Amendments to the ADEA

 The Older Workers Benefit Protection Act of 1990 prohibits employers from denying benefits to older employees except in limited circumstances.

 Pregnancy Discrimination Act of 1978 states that pregnancy is a disability and that pregnant employees must be treated on an equal basis with employees having medical conditions.

k. Americans with Disabilities Act of 1990

Figure 3.6

 ADA prohibits employers from discriminating against individuals with physical and mental disabilities and the chronically ill Reasonable accommodation is an attempt to adjust working conditions without undue hardship,

(Optional) Knowledge Check: <5 minutes total.

Use Figure 3.6 to discuss ways to make workplaces more accessible. Ask students to identify accessibility problems that they have seen or experienced

 Amendments to the ADA broadened the definition of a disability

 Genetic Information Nondiscrimination Act of 2008 protects genetic information

l. Uniformed Services Employment and Reemployment Rights Act of 1994 (USERRA)

 People in the military for five years can return to private-sector jobs without loss of seniority or benefits.

 Amendments to the USERRA. The Veterans Benefits Improvement Act requires employers to provide a notice of rights, benefits, and obligations of both employees and employers

3.2B. Other Federal Laws and Executive Orders Figure 3.7

l. Executive orders affect individuals employed by government contractors.

ll. Because many large companies have government contracts, many people are affected.

(Optional) Knowledge Check: <5 minutes total.

Use Figure 3.7 to discuss federal laws and executive orders that apply to government agencies and government contractors

a. Vocational Rehabilitation Act of 1973

 This act required private employers with federal contracts over $2,500 to hire individuals with a mental or physical disability.

 A disabled individual: has a physical or mental impairment that limits one or more major life activities; has a record of impairment; is regarded as having an impairment.

b. Executive Order 11246

 prohibits discrimination based on race, color, religion, sex, or national origin in all employment activities.

 Don’t Ask, Don’t Tell Repeal Act of 2010 ended the ban on gay, lesbian, or bisexual persons openly serving in the U.S. military.

3.2C.

Fair Employment Practice Laws (FEPs)

 state and local laws governing equal employment opportunity that are more comprehensive than federal laws and apply to small-business employers.

CO3.3: Demonstrate how to prevent other forms of discrimination that are of particular interest to managers

3.3. Other Equal Employment Opportunity Issues

l. Supervisors and managers should be familiar with workplace issues:

3.3A. Sexual Harassment

l. Unwelcome advances, requests for sexual favors, and other verbal or physical conduct of a sexual nature in the working environment

ll. Two forms of sexual harassment are illegal under Title VII:

 Quid pro quo harassment (submission to or rejection of sexual conduct is used as a basis for employment decisions)

 Hostile environment (unwelcome sexual conduct has the purpose or effect of unreasonably interfering with job performance or creating an intimidating, hostile, or offensive working environment)

3.3B. Sexual Orientation

l. Managers and supervisors should know and follow the legal rights of the LGBTQ community in their geographic area.

Figure 3.8

ll. Regardless of state or local laws, the EEOC interprets and enforces Title VII’s prohibition of sex discrimination as forbidding discrimination based on gender identity or sexual orientation.

(Optional) Knowledge Check: <5 minutes total.

Use Figure 3.8 to discuss laws in your geographic area pertaining to sexual orientation and gender identity discrimination

3.3C. Immigration Reform and Control

l. Employers must comply with the requirements of the Immigration Reform and Control Act (IRCA).

ll. The law has two employer mandates:

 All employers covered by the law are prohibited from knowingly hiring or retaining unauthorized aliens on the job.

 Employers with four or more employees are prohibited from discriminating in hiring or termination decisions based on national origin or citizenship

lll Employers must take the following actions to comply with the law:

 Have employees fill out their part of Form I-9.

 Check documents establishing an employee’s identity and eligibility to work.

 Complete the employer’s section of Form I-9.

 Retain Form I-9 for at least three years.

 Present Form I-9 for inspection to an Immigration and Naturalization Service officer or to a Department of Labor officer upon request.

3.3D. Emerging Employment Discrimination Issues

l. Weight Discrimination: Morbid obesity is a protected disability under the ADA

ll. Attractiveness and Discrimination: No federal laws prohibiting discrimination in the workplace are based on people’s attractiveness.

lll. Natural Hair Discrimination. Black women often find themselves discriminated against when they wear their natural hair.

 Many advocates are pushing for the U.S. Congress to implement national legislation against such discrimination.

lV Caregivers and Discrimination No federal statutes prohibit discrimination based solely on a person being a caregiver.

EOC (Optional) Discussion Question #1: 5 minutes total.

Discussion Activity 1

EEO legislation was prompted by significant social events. List those events and describe how they influenced the passage of various EEO laws. Cite and describe the major federal laws and court decisions that affect the employment process of both large and small organizations. After receiving several complaints of sexual harassment, the HR department of a city library decided to establish a sexual harassment policy. What should be included in the policy? How should it be implemented?

CO 3.4: Explain how the Uniform Guidelines on Employee Selection Procedures are used by firms and how they relate to the issues of adverse impact and disparate treatment.

3.4. Uniform Guidelines on Employee Selection Procedures: a procedural document in the Federal Register to help employers comply with federal regulations against discrimination

l. Validity shows how related a test or selection instrument is to the job.

ll. Adverse Impact and Disparate Treatment: the rejection of a higher percentage of a protected class for employment, placement, or promotion compared with the nonprotected class

 Disparate treatment: a situation in which protected class members receive unequal treatment or are evaluated by different standards.

lll. Adverse Rejection Rate, or Four-Fifths Rule

 Two methods show that adverse impact:

o The four-fifths rule: a rule of thumb followed by the EEOC in determining adverse impact

o Restricted policy: any evidence that an employer has a selection procedure that excludes members of a protected class, whether intentional or not, constitutes adverse impact.

lV. Workforce utilization analysis: classifying protected-class members by the number and by the type of job they hold.

. EOC (Optional) Discussion Question #4: 5 minutes total.

Discussion Activity 2

What are the Uniform Guidelines on Employee Selection Procedures? To whom do the guidelines apply? What do they cover? Joe Alverez has filed a complaint with the EEO alleging that his employer, Universal Mortgage Company, promotes more whites than Hispanics into managerial positions. Explain the statistical methods used by the EEOC to investigate this adverse impact claim.

CO 3.5: Describe how Equal Employment Opportunity recordkeeping and posting requirements work, including how discrimination charges are processed by the EEOC

3.5 Enforcing Equal Employment Opportunity Legislation

l. The EEOC ensures that covered employers comply with legislation in two ways:

 Issue guidelines and monitor the employment practices

 Protect employee rights through the investigation and prosecution of discrimination charges.

3.5A. Record-Keeping and Posting Requirements

l. Organizations subject to Title VII must maintain specific employment records and reports.

3.5B. Processing Discrimination Charges

l. The first step after experiencing discrimination is filing a charge form, a discrimination complaint, with the EEOC (Optional) Knowledge Check: <5 minutes total

Figure 3.9

Use Figure 3.9 to walk through the process of handling a discrimination charge. Ask students why an employee would not file a charge form

3.5C. Preventing Discrimination Charges

l. A comprehensive EEO policy and management training can help prevent discrimination. A comprehensive training program will include the following topics:

 The prohibitions covered in the various EEO statutes and executive orders

 Guidance on how to respond to complaints of discrimination

 Procedures for investigating complaints

 Suggestions for remedying inappropriate behavior

EOC (Optional) Discussion Question #5: 5 minutes total.

Discussion Activity 3

Understand how the EEOC affects companies and what you must do as a manager to appropriately respond to the administrative rules and

regulations published in the Federal Register As a marketing manager, you have recently turned down Nancy Conrad for a position as sales super visor. Nancy believes the denial was due to her gender, and she has filed a sex discrimination charge with the EEOC. Explain the steps the EEOC will use to process the charge; include Nancy’s options during the process.

CO 3.6: Explain what affirmative action is and how companies today are seeing the value of voluntarily having diverse workforces .

3.6 Affirmative Action and Diversity Management

l. Affirmative action: requiring organizations to comply with the law and correct past discriminatory practices by increasing the numbers of minorities and women hired

ll. A chief diversity officer (CDO): responsible for implementing a firm’s diversity efforts.

lll. A diversity program can lead to charges of reverse discrimination.

 Reverse discrimination: giving preference to members of protected classes to the extent that unprotected individuals believe they face discrimination.

3.6A. Court Decisions

l. Two cases of reverse discrimination in the 1970s: University of California Regents v. Bakke and United States Steelworkers of America v. Weber

ll. In the mid-1990s, affirmative action became less popular.

lll. In 2009, Ricci v. DeStafano underscored the importance of designing and following careful selection procedures

3.6B. Beyond Affirmative Action: Leveraging Diversity

l. Diversity is important in the workplace.

Figure 3.10

ll The steps toward leveraging people’s differences involve seeing, understanding, and valuing them.

(Optional) Knowledge Check: <5 minutes total

Use Figure 3.10 to discuss how diversity can be leveraged in the workplace. Ask students how diversity can benefit the employer.

EOC (Optional) Discussion Question #6: 5 minutes total.

Discussion Activity 4

Affirmative action is both a legal and emotional issue affecting employees and employers. Develop as many arguments as you can both supporting and opposing affirmative action as an employer policy. If you were asked to implement such a program, what steps would you follow?

Discussion Questions

1. Question: Given that the United States was founded on the principles of individual merit, hard work, and equality, how have people‘s perceptions of these values changed the way they see discrimination in the workplace? More recent events, such as the tragic killings of George Floyd, Breonna Taylor, Ahmaud Arbery, and others have laid bare the brutal costs of systemic discrimination. How would you advise a manager to root out system discrimination in an organization?

Suggested answer: Despite their shortcomings, laws and executive orders have laid the groundwork for a significant number of laws that bar employment discrimination. Part of the reason why it is so critical for managers and supervisors to understand and apply EEO laws is that employees act as agents of the firm. If a manager or supervisor violates the law, both he or she and the organization face legal consequences. Figure 3.2 shows the various prohibited HR activities related to hiring, promoting, compensating employees covered by EEO laws. The best advice for a manager to root out discrimination is to follow the EEO laws.

2. Question: EEO legislation was prompted by significant social events. List those events and describe how they influenced the passage of various EEO laws. Cite and describe the major federal laws and court decisions that affect the employment process of both large and small organizations. After receiving several complaints of sexual harassment, the HR department of a city library decided to establish a sexual harassment policy What should be included in the policy? How should it be implemented?

Suggested answer: Equal employment opportunity as a national priority has emerged slowly in the United States. Three factors seem to have influenced the growth of EEO legislation: (1) changing attitudes toward employment discrimination; (2) published reports highlighting the economic problems and injustices experienced by minority workers; and (3) a growing body of disparate discrimination laws and regulations at different levels of government that legislators feel should be standardized.

Major federal laws affecting equal employment opportunity are listed in Figure 3.4. They include Equal Pay Act of 1963, Title VII of Civil Rights Act of 1964, Age Discrimination in Employment Act of 1967, Equal Employment Opportunity Act of 1972, Pregnancy Discrimination Act of 1978, Americans with Disabilities Act of 1990, Civil Rights Act of 1991, Uniformed Services Employment and Reemployment Rights Act of 1994, and Don’t Ask, Don’t Tell Repeal Act of 2010.

Additional federal laws applicable to federal contractors and agencies are listed in Figure 3.7. They include Vocational Rehabilitation Act of 1973, Executive Order 11246, and Executive Order 11478. Highlights in HRM 2 in the textbook lists the components of an effective sexual harassment policy in the form of some sample questions that firms can ask their employees to gauge their knowledge of the topic.

3. Question: List specific behaviors that may be considered sexual harassment in terms of both quid pro quo or hostile environment harassment. Discuss some examples of LGBTQ-related claims that the EEOC might view as unlawful discrimination.

Suggested answer: Some examples of LGBTQ-related claims that EEOC views as unlawful gender discrimination include:

 Failing to hire an applicant because they are transgender

 Firing an employee because they are planning to make or have made a gender transition.

 Denying an employee equal access to a common restroom corresponding to the employee’s gender identity.

 Harassing an employee because of a gender transition, such as by intentionally and persistently failing to use the name and gender pronoun that correspond to the gender identity with which the employee identifies, and which the employee has communicated to management and employees.

 Denying an employee a promotion because of sexual orientation.

 Discriminating in terms, conditions, or privileges of employment, such as providing a lower salary to an employee because of sexual orientation, or denying spousal health insurance

 Harassing an employee because of their sexual orientation, for example, by derogatory terms.

4. Question: What is the Uniform Guidelines on Employee Selection Procedures? To whom do the guidelines apply? What do they cover? Joe Alverez has filed a complaint with the EEO alleging that his employer, Universal Mortgage Company, promotes more Whites than Hispanics into managerial positions. Explain the statistical methods used by the EEOC to investigate this adverse impact claim.

Suggested answer: The Uniform Guidelines on Employee Selection Procedures is a procedural document published in the Federal Register to help employers comply with federal regulations against antidiscriminatory actions. The Guidelines is designed to help employers, labor organizations, employment agencies, and licensing and certification boards to comply with the requirements of federal laws prohibiting employment discrimination. The guidelines apply to employee selection procedures in the areas of hiring, retention, promotion, transfer, demotion, dismissal, and referral.

The EEOC has adopted the four-fifths rule as a statistical method to determine the initial validity of adverse impact discrimination charges. According to the Uniform Guidelines, a selection program has an adverse impact when the selection rate for any racial, ethnic, or gender class is less than four-fifths (or 80 percent) of the rate of the class with the highest selection rate. This procedure allows the EEOC to monitor serious discrepancies in employment decisions.

The EEOC may also use standard deviation analysis to determine adverse impact. This procedure determines the ―chance‖ happening of an employer’s selection rate for protected groups compared to the employer’s actual selection rates. If chance is eliminated for the lower selection rate of the protected class, the EEOC assumes that the employer’s selection technique has an adverse impact on the employment opportunities of the protected groups.

5. Question: Understand how the EEOC affects companies and what you must do as a manager to appropriately respond to the administrative rules and regulations published in the Federal Register As a marketing manager, you have recently turned down Nancy Conrad for a position as sales supervisor. Nancy believes the denial was due to her gender, and she has filed a sex discrimination charge with the EEOC. Explain the steps the EEOC will use to process the charge; include Nancy‘s options during the process.

Suggested answer: Nancy has 180 days from the alleged discrimination to file a charge of discrimination. Figure 3.9 illustrates the steps followed by the EEOC when processing a charge of discrimination. Nancy has the option to withdraw the charge at any time during the EEOC’s investigation. If the EEOC dismisses the charge, Nancy can file an individual suit after receiving a right-to-sue letter from the EEOC. Should the EEOC fail to sue in Nancy’s behalf and should her charge have merit (a conciliation argument is not reached), she may begin an individual suit within 90 days.

6. Question: Affirmative action is both a legal and emotional issue affecting employees and employers. Develop as many arguments as you can both supporting and opposing affirmative action as an employer policy. If you were asked to implement such a program, what steps would you follow?

Suggested answer: Proponents of affirmative action argue that it corrects past patterns of discrimination and forces organizations to take a proactive approach to hiring and promoting protected classes. Affirmative action programs help organizations become socially responsible. Those against affirmative action believe it is a form of reverse discrimination. They argue that current employees should not suffer the ills of past discrimination. Furthermore, affirmative action reduces productivity by hiring and promoting those who may be the least productive. Highlights in HRM 4 in the chapter provides the basic steps in developing an effective affirmative action program.

Additional Discussion Questions

The following are discussion questions that do not appear in the text, PPTs, or courseware (if courseware exists) – they are for you to use as you wish. You can assign these questions several ways: in a discussion forum in your LMS; as whole-class discussions in person; or as a partner or group activity in class.

EOC (Optional) Additonal Discussion Question #1: 5 minutes total.

7. Question: As Americans have watch tv images of thousands of people crossing the southern border, what are your ideas on a fair-minded, humanitarian immigration policy? Should people who enter the United States illegally be employed? Should they be deported?

Suggested answer: Answers will vary. This is a very ―hot button‖ issue. On one hand, America has always welcomed immigrants and provided a new lease on life for those from oppressive nations. On the other hand, the open-border policy has wreaked havoc on the country. Feeding, housing, providing medical care, and education for illegal immigrants is costly and taking resources and jobs away from Americans. The discussion should include the employment laws which are specific about hiring undocumented workers.

Additional Activity

The following activity was developed by Cengage but not included in the text, PPTs, or MindTap Group Discussion- Affirmative Action. In small groups or over Zoom or Teams, students will debate the pros and cons of affirmative action. Affirmative action is both a legal and emotional issue affecting employees and employers.

 Develop as many arguments as you can both supporting and opposing affirmative action as an employer policy.

 If you were asked to implement such a program, what steps would you follow?

Case Study 1: Going to the Dogs

1. Question: What is your position on this issue? Provide two or three reasons to support your argument.

Suggested answer: Students’ answers will vary, but this should produce a lively discussion. Instructors might begin by asking their students how many of them have a pet or have had one at some time. Have they ever been employed some place where one can bring his or her pet to work? Do they think it would be okay for anyone to bring his or her pet to class even if he or she does not have a disability? Divide the class into groups who will defend Elizabeth’s actions and those who will argue that the employer’s position does not constitute discrimination.

2. Question: If you were an HR manager of a company, what pet policy would you set and how would you implement it?

Suggested answer: Student answers will vary. One possible approach might involve Employee participation in recommending a pet policy that would be satisfactory to all stakeholders.

If the person claims the animal is a service animal trained to perform specific tasks, the

employer can ask the individual to identify tasks or functions that the animal performs. Also, the employer can ask for a specific description of how tasks or functions are performed.

If a person wants an animal to accompany him or her to work, the employer can determine whether the animal is a service animal and whether the individual is a qualified individual with a disability. An individual claiming that he or she needs a companion animal to relieve his or her workplace stress will probably not be allowed to bring the animal to work since workplace stress is not a recognized disability by the EEOC.

3. Questions: How would you decide the case of Elizabeth Booth, and which laws would you base your decision on? Explain.

Suggested answer: Students’ answers will vary. Unfortunately, there is no precise statutory definition of service animal nor is there informative case law in this area. Nevertheless, employees with depression, anxiety, and other psychiatric conditions are seeking to bring their animals to work to alleviate their symptoms. However, ―companion animals‖ may not be trained to perform tasks to specifically assist a disabled individual perform his or her job duties. The EEOC’s regulations do specify that an employer may turn down a request for accommodation where it would cause an undue hardship or present ―a direct threat‖ that is a significant risk to the health or safety of others.

If Elizabeth can show clearly that her dog is a specially trained service animal, the EEOC may decide in her favor because the tasks service animals can perform are broadening. However, what if coworkers sit next to Elizabeth and can assist with picking up occasionally dropped items? Cases of this nature are often settled on a

Case Study 2: Misplaced Affections: Discharge for Sexual Harassment

1. Question: Evaluate the conduct of Peter Lewiston against the EEOC‘s definition of sexual harassment.

Suggested answer: The EEOC defines ―sexual harassment‖ to include not only overt acts of sexual misconduct but also employee actions that have the effect of creating an intimidating, hostile, or offensive working environment. The actions of Peter Lewiston would likely fall under the EEOC’s definition of sexual harassment if those actions are viewed as offensive by Beverly Gilbury.

2. Question: Should the intent or motive behind Lewiston‘s conduct be considered when deciding sexual harassment activities? Explain.

Suggested answer: The EEOC will consider sexual harassment complaints on a case-bycase basis. Furthermore, all aspects of the incident will be considered. While the actual conduct of the harasser will be an important factor under consideration, the purpose or intent behind the actions will enter into the investigation of the case. Incidents where no severe harm was intended will be evaluated differently from cases where the sexual harassment was done for harmful motive.

3. Question: If you were the district‘s EEOC officer, what would you conclude? What disciplinary action, if any, would you take?

Suggested answer: Some students might decide that discharge was warranted. Others may believe that termination was overly harsh and that a suspension or a written reprimand would have been a more appropriate penalty. Those students who elected to overturn the discharge might cite the employee’s good work record, the short time period over which the incidents happened, or the lack of harmful intent as mitigating factors. It might be interesting to see how female and male students would finalize this case. In the actual case from which this example was drawn, the arbitrator overturned the discharge and instead gave the employee a 30-day suspension without pay.

Additional Resources

Cengage Video Resources

MindTap Videos: o Chapter 03: Concept Clip: Equal Employment Opportunity o Chapter 03: On The Job: Jet Blue- Diversity

Chapter 04: Job Analysis and Job Design

Instructor Manual

Snell/Morris,

Purpose and Perspective of the Chapter

The information a job analysis collects serves many HRM functions, including a firm‘s workflow and design of jobs, its legal compliance efforts, and the recruitment, selection, training and development, performance appraisal, and compensation of employees. To comply with the law, human resources decisions must be based on criteria objectively collected by analyzing the requirements of each job. Job analysis information can be gathered in several ways via interviews, questionnaires, observations, and diaries.

Job design focuses on restructuring jobs to capture the talents of employees, improve their work satisfaction, and an organization‘s performance. Top-down job design techniques focus more on tasks; bottom-down techniques focus more on workers and how to motivate them to do their jobs better. Increasingly, firms are using employee teams to solve unique and complex problems, enhance the collaboration among workers, improve their morale and performance, and make the most of a firm‘s scarce resources.

Chapter Objectives

The following objectives are addressed in this chapter:

1. Explain what a job analysis is and how it is used in conjunction with a firm‘s HRM functions.

2. Explain how the information for a job analysis typically is collected and incorporated into various sections of a job‘s description.

3. Provide examples illustrating the various factors that must be taken into account when designing a job, including what motivates employees.

4. Describe the different types of teams and work arrangements used to enhance the contributions of employees.

Key Terms

Job: An activity people do for which they get paid, particularly as part of the trade or occupation they occupy.

Job analysis: The process of obtaining information about a job by determining its duties, tasks, or activities.

Job description: A statement of the tasks, duties, and responsibilities of a job to be performed.

Job specifications: A statement of the specific knowledge, skills, and abilities of a person who is to perform a job needs.

Functional job analysis (FJA): A job analysis approach that utilizes an inventory of the various types of work activities that can constitute any job.

Position analysis questionnaire (PAQ): A questionnaire that identifies approximately 300 different tasks to determine the degree to which each is involved in doing a job.

Critical incident method: A job analysis method used to identify both desirable and undesirable behaviors that resulted in either a very good outcome or a very bad outcome on the job.

Task inventory analysis: An organization-specific list of tasks and their descriptions used as a basis to identify components of jobs.

Job design: An outgrowth of job analysis that improves jobs through technological and human considerations in order to enhance organization efficiency and employee job satisfaction.

Industrial engineering: A field of study concerned with analyzing work methods and establishing time standards.

Ergonomics: The process of studying and designing easy-to-use equipment and systems so the physical well-being of employees isn‘t compromised and work gets done more efficiently.

Job enrichment: Enhancing a job by adding more meaningful tasks and duties to make the work more rewarding or satisfying.

Job characteristics model: A job design theory that purports that three psychological states (experiencing meaningfulness of the work performed, responsibility for work outcomes, and knowing the results of the work performed) result in a jobholder‘s improved work performance, internal motivation, and lower absenteeism and turnover.

Job enlargement: The process of adding a greater variety of tasks to a job.

Job rotation: The process whereby employees rotate in and out of different jobs.

Employee empowerment: Giving employees the power to initiate change, thereby encouraging them to take charge of what they do.

Job crafting: A naturally occurring phenomenon whereby employees mold their tasks to fit their individual strengths, passions, and motives better.

Employee engagement: A situation in which workers are enthusiastic and immersed in their work to the degree that it improves the performance of their companies.

Employee team: A group of employees working together toward a common purpose, in which members have complementary skills, members‘ work is mutually dependent, and the group has discretion over tasks performed.

Dejobbing: Refers to a process of structuring organizations not around jobs but around projects that are constantly changing.

Virtual teams: Teams that utilize telecommunications technology to link team members who are geographically dispersed often worldwide across cultures and across time zones.

Flextime: Flexible working hours that give employees the option of choosing daily starting and quitting times, provided that they work a set number of hours per day or week.

Job sharing: An arrangement whereby two part-time employees do a job normally held by one fulltime employee.

Telecommuting (or working remotely): The use of personal computers, networks, and other communications technology to do work in the home that is traditionally done in the workplace.

What's New in This Chapter

The following elements are improvements in this chapter from the previous edition:

Chapter # New component(s)

Chapter 4 ● New discussion of the change continually happening for workflow.

Chapter 4 ● New discussion of the need for flexible work arrangements.

Chapter 4 ● Term change from ―telecommuting‖ to ―working remote‖

Chapter 4 ● New section considering the recent spike in remote work.

Chapter Outline

The following outline organizes activities (including any existing discussion questions in PowerPoints or other supplements) and assessments by chapter (and therefore by topic), so that you can see how all the content relates to the topics covered in the text

CO 4.1: Explain what a job analysis is and how it is used in conjunction with a firm’s HRM functions.

4.1 What Is a Job Analysis and How Does It Affect Human Resources Management?Figure 4.1

l. Job analysis: the process of obtaining information about a job by determining its duties, tasks, or activities.

ll. Strategic HR planning. A job analysis is used to examine a company’s organizational structure and strategically position it for the future.

lll. Workflow analysis and job design. The information generated by a job analysis can be used to analyze a company’s work processes that is, how work is done.

iv. Recruitment and selection. Some of the information provided in a job analysis is contained in job advertisements.

v. Training and development. Discrepancies between the abilities of jobholders and a firm‘s job descriptions provide clues about training.

vi. Performance appraisal and compensation. A job analysis provides the criteria for evaluating what constitutes good performance.

vii. Compensation management. Conducting a job analysis helps HR managers figure out the relative worth of positions so compensation is fair and equitable.

viii. Legal compliance. If the criteria used to hire and evaluate employees are not job related, employers are more likely to find themselves being accused of discrimination. (Optional) Knowledge Check: <5 minutes total.

Use Figure 4.1 to discuss job analysis. Ask students to name job requirements that have the potential to negatively affect protected class members (e.g., height or weight requirements).

4.1A. Major Parts of the Job Analysis

l. Two major pieces of information come out of a job analysis:

 A job description is a statement of the tasks, duties, and responsibilities of a job to be performed.

 Job specifications include a statement of the specific knowledge, skills, and abilities that a person who is to perform a job needs.

o Knowledge is what you know.

o Skills are things you have learned to do

o Abilities are your innate aptitudes

o Other attributes refer to your personality, values EOC (Optional) Discussion Question #1: 5 minutes total.

Discussion Activity 1

Assume you are the general manager of a service department. How might formally

written job requirements help you manage your work unit?

CO 4.2: Explain how the information for a job analysis typically is collected and incorporated into various sections of a job’s description.

4.2 Sources of Job Analysis Information

l. Job analysis consists of a series of logical steps that must be performed in order.

Figure 4.2

ll. The first step is collecting information.

lll. The most common information collection methods include:

 Interviews

 Questionnaires

 Observation

 Diaries

(Optional) Knowledge Check: <5 minutes total.

Use Figure 4.2 to discuss the job analysis process and the flow of information.

4.2A. Controlling the Accuracy of the Job Data Collected

l. Check any data that seem contradictory.

ll. Ask jobholders and managers to check a job analysis for accuracy.

4.2B. Other Sources of Job Analysis Information

l. Five of the most popular quantitative job analysis approaches are discussed.

Figure 4.3

a. Functional Job Analysis System: utilizes an inventory of work activities that can constitute any job. Each job function is assigned a percentage in terms of its importance to the job.

b. The Position Analysis Questionnaire System: identifies 300 different tasks to determine the degree to which each is involved in a job. The results are quantitative

c. The Critical Incident Method: identifies desirable and undesirable behaviors that resulted in a good or bad outcome on the job. Information is collected through interviews or surveys

(Optional) Knowledge Check: <5 minutes total.

Use Figure 4.3 to discuss the prevalence of good, neutral, and bad outcomes from a critical incident

d. Task Inventory Analysis: an organization-specific list of tasks and descriptions which identify components of jobs to produce a list of task statements applicable to all jobs.

e. Competency-Based Approach: job profiles that look at the competencies or capabilities needed to do jobs well.

 The objective is to identify key competencies through focus groups, surveys, or interviews.

(Optional) Knowledge Check: <5 minutes total.

Figure 4.4

Use Figure 4.4 to discuss how skills are evaluated in the competencybased approach

4.2C. Parts of a Job Description

l. Job descriptions contain:

 the job’s title and location

 a job identification section, with information such as a numerical job code, to whom the jobholder reports, and wage information

 a job duties section

(Optional) Group Activity

Have students form groups, prepare a job description, and present the results orally in class. Explain that job descriptions don’t follow a standard format. Organizations write job descriptions based on their needs. Refer students to Highlights in HRM 2 in the textbook for an example of a job description.

a. Job Title: serves three purposes

 Provide status to the Indicate the job duties.

 Indicate the level of the job in the.

b. Job Identification Section includes:

 the department and location of the job

 the supervisor

 date the job description was last revised.

 A ―Purpose‖ statement distinguishes the job from others.

c. Tasks, Duties, and Responsibilities Section: duties arranged in order of importance.

 Employers must show that job criteria to select employees are essential functions for success.

d. Job Specifications Section: two areas of qualifications

 skills required to perform the job

 job’s physical demands

 skills relevant to the job include:

o Education

o Experience

o specialized training

o personal traits or abilities and manual dexterities required

o interpersonal skills for a competency-based approach

4.2D. Writing Clear and Specific Job Descriptions

l. Problems with job descriptions:

 Lack of specifics

 Out-of-date information

 Violations of laws or union agreements

 Limited scope of the jobholder’s activities

EOC (Optional) Discussion Question #2: 5 minutes total.

Discussion Activity 2

Discuss the various ways in which a job analysis can be completed.

Compare and contrast these methods, noting the pros or cons of each.

CO 4.3: Provide examples illustrating the various factors that must be taken into account when designing a job, including what motivates employees

4.3. Job Design Figure

4.5

l. Job design is an outgrowth of job analysis that improves jobs through technological and human considerations to enhance organization efficiency and employee job satisfaction.

ll. Industrial engineering is concerned with analyzing work methods and establishing time standards.

4.3A. Ergonomics Figure

4.5

l. the process of studying and designing easy-to-use equipment and systems so the physical well-being of employees isn’t compromised, and work is done more efficiently.

ll. Factors such as the work climate, the facilities’ temperatures, noise and lighting, the length of schedules and fatigue factors.

lll. Ergonomics looks at the design of equipment and the physical abilities of the different operators.

(Optional) Knowledge Check: <5 minutes total.

Use Figure 4.5 to discuss top-down and bottom-up job design approaches.

4.3B. Enrichment

l. Job enrichment: enhancing a job by adding more meaningful tasks and duties to make the work more rewarding or satisfying.

ll. The goal: to enrich a job so that it is intrinsically motivating to employees versus extrinsically motivating.

lll. Job characteristics model: a job design theory that suggests three psychological states:

4.6

 Experiencing meaningfulness of the work performed

 Experiencing responsibility for work outcomes

 Knowing the results of the work performed

lV. These result in a jobholder’s:

 improved work performance

Figure

 internal motivation

 lower absenteeism and turnover

V. Five core job dimensions produce the three psychological states.

VI. The job dimensions:

 skill variety

 task identity

 task significance

 autonomy

 feedback

(Optional) Knowledge Check: <5 minutes total.

Use Figure 4.6 to discuss the five core job dimensions. Explain that it is important to build all five core dimensions into a job because each of these dimensions affects employee performance differently

VII. Enrich jobs by increasing the autonomy and responsibility of employees.

 Job enlargement is the process of adding a greater variety of tasks to a job.

 Job rotation is the process whereby employees rotate in and out of different jobs.

a. Employee Empowerment: giving employees the power to initiate change; encouraging them to take charge of their tasks.

 Workplace democracy: democratic principles such as voting and debate give employees more input on running an organization and the direction it takes

 Job crafting: employees mold their tasks to fit their individual strengths, passions, and motives better.

 Employee engagement: a situation in which workers are enthusiastic and immersed in their work to the degree that it improves company performance

EOC (Optional) Discussion Question #3: 5 minutes total.

Discussion Activity 3

Why is employee motivation such an important aspect of designing today’s jobs? The job characteristics model has five components skill variety, task identity, task significance, autonomy, and feedback. Provide an example of how each component can be used to improve an organization and the job of an employee. (Suggestion: Consider your present or a recent job to answer this question)

CO 4.4: Describe the different types of teams and work arrangements used to enhance the contributions of employees.

4.4.

Employee Teams and Flexible Work Schedules

l. The traditional ways of organizing can be too rigid for today‘s dynamic marketplace

ll. Companies see the advantages of redesigning work schedules to make them flexible, and adding flexibility to where employees can work.

EOC (Optional) Discussion Question #4: 5 minutes total.

Discussion Activity 4

Figure 4.8 shows the different forms of employee teams. Provide an

4.4A.

Employee Teams

example of where each type of team can be used. How do teams create synergy?

Figure 4.7

l. An employee team: a group of employees working together toward a common purpose:

 members have complementary skills

 members’ work is mutually dependent

 the group has discretion over tasks performed.

ll. Employee teams are often in a better position than managers to see how the work can be done better.

(Optional) Knowledge Check: <5 minutes total.

Use Figure 4.7 to discuss synergy. Ask students what they think is meant by team synergy. Teamwork embraces the concept of synergy. Synergy occurs when the interaction and outcome of team members is greater than the sum of their individual efforts

lll. Teams can operate in a variety of structures, each with different strategic purposes or functional activities. Figure

4.8

 Cross-functional teams

 Project teams

 Self-directed teams

 Task force teams

 Process-improvement teams

 Virtual teams

(Optional) Knowledge Check: <5 minutes total.

Use Figure 4.8 to discuss different types of teams. Ask students to describe employee teams in their experience

lV. Team members acquire multiple skills so that they can perform a variety of tasks as part of the team.

 Dejobbing: structuring organizations not around jobs but around projects that are constantly changing.

a. Virtual Teams: utilize telecommunications technology to link team members who are geographically dispersed worldwide across cultures and time zones.

b. Facilitating Teams: characteristics of successful teams:

 A commitment to shared goals and objectives

 Motivated and energetic team members

 Open and honest communication

 Shared leadership

 Clear role assignments

 A climate of cooperation, collaboration, trust, and accountability

 The recognition of conflict and its positive resolution

To prevent team problems

 Determine when a team is needed.

 Design the compensation so that the team’s members individually and jointly work for its achievements.

 Have the members undergo team training.

V. Team training would cover:

 team leadership

 mission/ goal setting

 how to conduct meetings

 team decision-making

 conflict resolution

 effective communication

 diversity awareness.

4.4B. Flexible Work Schedules

l. Common flexible work schedules: flextime, the compressed workweek, job sharing, and telecommuting.

a. Flextime: flexible working hours that give employees the option of choosing daily starting and quitting times, provided that they work a set number of hours per day or week.

 With flextime, employees are given latitude in scheduling their work.

 Advantages:

o Good employee recruiting and retention tool

o Extended operating hours

o Positive impact on reliability, quality, and quantity of the employee’s work

 Disadvantages:

o Not suited to all jobs

o Scheduling

b. Compressed Workweek: the number of days in the workweek is shortened by lengthening the number of hours worked per day.

 Advantages:

o Reducing absenteeism and improving recruitment and retention of employees

o Lengthening workers’ weekends

Disadvantage:

 The Fair Labor Standards Act has stringent rules requires the payment of overtime to nonsupervisory employees who work more than 40 hours a week.

c. Job Sharing: two part-time employees do a job normally held by one full-time employee

 Job sharers can reduce workers’ stress and reduce layoffs in hard economic times.

d. Telecommuting: the use of personal computers, networks, and other communications technology to work at home

(Optional) Knowledge Check: <5 minutes total.

Use Figure 4.9 to discuss successful telecommuting. Ask students to

discuss the advantages and disadvantages of telecommuting to the individual employee and to the organization. Also, ask them to think about the additional burdens that are placed on supervisors

Discussion Questions

1. Question: Assume you are the general manager of a service department. How might formally written job requirements help you manage your work unit?

Suggested answer: Formally written job requirements aid managers in almost all aspects of managing employees. By knowing the requirements of the job, managers can select, orient, and train employees for job success. Job requirements that are accurate descriptors of job success comply with EEOC requirements for valid job-related criteria. When managers know the requirements of jobs, they are in a defensible position to evaluate employees during performance appraisal periods.

2. Question: Discuss the various ways in which a job analysis can be completed. Compare and contrast these methods, noting the pros or cons of each.

Suggested answer: The textbook discusses the common approaches to performing a job analysis. These include interviews, questionnaires, observations, diaries, the functional job analysis (FJA), the position analysis questionnaire (PAQ), the critical incident method, the task inventory analysis, and the competency-based approach. While all job analysis techniques are subjective to some degree, those using quantitative approaches (FJA and PAQ) are often viewed as more valid by the EEOC and the courts. Techniques such as personal questionnaires, interviews, and observations are highly subject to bias and subjectivity.

3. Question: Why is employee motivation such an important aspect of designing today‘s jobs? The job characteristics model has five components skill variety, task identity, task significance, autonomy, and feedback. Provide an example of how each component can be used to improve an organization and the job of an employee. (Suggestion: Consider your present or a recent job to answer this question.)

Suggested answer: Your students should not have any difficulty responding to this question. Clearly, if there are at least two alternative ways to design a job with one that is demotivational (with one resulting in low productivity and employee turnover) and another that will produce the opposite result, the choice is obvious. Ask students if they have ever had a job that they really disliked and how it could have been designed better.

4. Question: Figure 4.8 shows the different forms of employee teams. Provide an example of where each type of team can be used. How do teams create synergy?

Suggested answer: Figure 4.8 describes common team forms. They include crossfunctional teams, project teams, self-directed teams, task force teams, processimprovement teams, and virtual teams.

A cross-functional team is a group staffed with a mix of employees from an organization’s marketing, production, engineering departments, and so forth and is formed to accomplish a specific objective.

A project team is a group formed specifically to design a new product or service. The members are assigned by their managers on the basis of their ability to contribute to the team’s success. The group normally disbands after the task is completed.

A self-directed team is a group of highly trained individuals performing a set of interdependent job tasks within a natural work unit. The team members rely on consensus-type decision-making to perform their work duties, solve problems, or deal with internal or external customers.

A task force team is a group formed by management to immediately resolve a major problem.

A process-improvement team is a group made up of experienced people from different departments or functions. The group is charged with improving quality, decreasing waste, or enhancing the productivity of processes that affect all departments or functions. The members are normally appointed by management.

A virtual team is a team that utilizes telecommunications technology to link team members who are geographically dispersed often worldwide across cultures and across time zones.

Synergy occurs when the interaction and outcome of team members is greater than the sum of their individual efforts. However, synergy in teams does not automatically happen, rather, it must be nurtured within the team environment. Team synergy is heightened when team members engage in the following behaviors:

 Support. The team exhibits an atmosphere of inclusion. All team members speak up and feel free to offer constructive comments.

 Listening and Clarification. Members honestly listen to others and seek clarification on discussion points. The team members summarize discussions held.

 Disagreement. Disagreements are seen as natural and are expected. The members’ comments are nonjudgmental and focus on factual issues rather than personality differences.



Consensus. The team’s members reach agreements through consensus. Proposals that are acceptable to all team members are adopted, even if they are not the first choice of some of the individual members. Common ground among ideas is sought.

 Acceptance. The team members value one another as individuals. They recognize that each person brings a valuable mix of skills and abilities to the

 Quality. Each team member is committed to excellence. There is emphasis on continuous improvement and attention to detail.

Additional Discussion Questions

The following are discussion questions that do not appear in the text, PPTs, or courseware (if courseware exists) – they are for you to use as you wish. You can assign these questions several ways: in a discussion forum in your LMS; as whole-class discussions in person; or as a partner or group activity in class.

5. Question: In the era of COVID when many jobs moved from the office to the home, flexibility on the job has become the new norm for many workers. Discuss the advantages and disadvantages of a flexible work schedule?

Suggested answer: Advantages: Besides being a good employee recruiting and retention tool, flextime allows organizations that want to improve customer service to extend their operating hours. Younger workers in particular want flexibility on the job. For example, a lack of it made it difficult for PricewaterhouseCoopers, a Big-4 accounting firm, to retain millennials, especially during the busy tax auditing season. The company implemented a program that encouraged employees to customize their schedules to avoid burnout. Kathie Lingle, national director of work/life at KPMG, a competing Big-4 accounting firm, says flextime is the number-one driver of retention for her firm. Disadvantages: First, flextime is not suited to some jobs, such as those that require specific workstations to be staffed at all times. Second, it can create problems for managers trying to supervise and schedule meetings with employees who aren‘t onsite when they are. To keep in closer touch with employees when they are working offsite, some firms utilize work-oriented social media tools such as Slack, Yammer, and Workplace by Facebook

Additional Activity

The following are activities and assignments developed by Cengage but not included in the text, PPTs, or courseware (if courseware exists) – they are for you to use if you wish.

Internet Activity: Reshaping the World of Work

How future-forward organizations are transforming the employee experience. The future of work blurs the lines between physical and digital environments. Employees expect employers to

Instructor

provide a seamless user experience where they can work from anywhere, on any device. But the journey to transforming the employee experience is beset with complexity. Students will go to the following website and learn about the changing work environment. They will then share their thoughts with the class.

https://www.teksystems.com/en/insights/version-next-now/2021/digital-workplaceissue?ecid=ps_tek_p_cli-gen_xx_vrsnnxt,nwd_google_xx_xx_20210924_vn654321&vendor_id=4100&gclid=CjwKCAjwsqKBhBjEiwAVaQ9axcOsIqxZZX6jJw2RgTcCR1Qg3GfGPzwyvyyTUdt4qEtZHyDshgozxoCp wYQAvD_BwE

Case Study 1: The Zappos Experiment

1. Question: Is a self-managing organization a good idea? Why or why not?

Suggested answer. Students’ answers may vary. Some may say that a self-managing organization can grow in a unique way that benefits the organization. Others will say that a managed organization is safer, more predictable, and has a better chance of success.

2. Question: Could Zappos have done anything to make the transition to the new system smoother? If so, what?

Suggested answer: Students’ answers may vary. Some may say that a transition team could have prepared the people better by managing expectations, training employees, and assisting former managers.

Case Study 2: Apple’s Design Team

1. Question: What made Apple‘s design team so unique? How did the members work together? What made it so successful?

Suggested answer: Jobs and Ive had complementary styles and complementary strengths. ―Ive could translate futuristic concepts into physical objects with simplicity and sophistication…Jobs was the inspiration and the editor needed to bring these ideas to life.‖ But Jobs and Ive were alike in their design philosophies: both put beauty before everything. The design team worked apart from the company: the team was secretive. Team members were not allowed to discuss their work with friends but shared everything with each other. Although each designer had a specialty, and each project had a team leader, they cross-pollinated continuously, and everyone contributed to each other‘s work, sharing the credit. The team described itself as a family, socialized after work, and created a work-hard, play-hard culture that continued for years. The design team enjoyed a level of influence at Apple unimaginable at other firms.

2. Question: What happened to the team? How could Apple have prevented its decay?

Suggested answer: Steve Jobs died in 2011. Ive remained the creative soul of

Apple, and without Jobs, he had more responsibility. Ive‘s role expanded; he was in charge of both hardware and software design and had a much bigger team reporting to him. In 2015 Ive‘s responsibilities changed, and others took them over. This change proved to be disruptive. Tim Cook worked to keep Ive engaged and committed, in part with a large pay package, a point of friction with others on the executive team. Cracks started to form in his design team as well. Several members left over the next few years. The departures heralded a new era. On Thursday, June 20, 2019, Ive gathered his design team in their new headquarters at Apple Park. He explained that he was leaving the company,

3. Question: Now that there is a new team, what should Apple do to recreate the magic?

Suggested answer: Answers will vary. It is clear that the relationships built between the founders of Apple and the members of the original design team fostered Apple‘s innovation and success. When the design team became greatly enlarged, the camaraderie among members decreased. When a leader like Ive leaves the company, there is a profound repercussion. Apple will have to reconstitute its design team based on common goal of developing new innovative products. To accomplish this goal, everyone must contribute to each other‘s work, sharing the credit.

Additional Resources

Cengage Video Resources

MindTap Videos:

o Chapter 04: Concept Clip: Job Analysis

o Chapter 04: On The Job: Intermountain Healthcare-

o Job Analysis & Design

Chapter 5: Expanding the Talent Pool: Recruitment and Careers

Instructor Manual: Snell/Morris, Managing Human Resources 19e, c23, ISBN: 9780357716519; Chapter #1: The Opportunities and Challenges of Human Resources Management

Instructor Manual

Snell/Morris, Managing Human Resources 19e, c23, ISBN: 9780357716519; Chapter #5: Expanding the Talent Pool: Recruitment and Careers

Table of Contents

Purpose and Perspective of the Chapter 65

Chapter Objectives 65

Key Terms 65

What's New in This Chapter 67

Chapter Outline 67

Discussion Questions 11

Additional Discussion Questions 13

Additional Activities and Assignments……………………………………………………………………………….18

Case Study 1: A Lifecycle Approach to Talent……………………………………………………………………..19

Case Study 2: Homegrown Talent: Mary Barra Rises to GM’s Top Post 19 Additional Resources………………………………………………………………………………………… ………………20

Purpose and Perspective of the Chapter

In this chapter, we discuss the many strategies and techniques organizations use both internally and externally to acquire the talent they need. The competition for top talent requires firms not only to look for talented pools of employees, but also to figure out what they want, determine how to develop relationships with them, and establish the firm as an employer of choice. In this chapter, we also discuss the approaches organizations take to help employees manage their careers over time. This issue is important because, unlike physical assets, human assets (employees) can decide to leave the firm. Finally, at the end of the chapter, we devote special attention to the recruitment and career development of diverse employees.

The decisions a company makes about talent need to be considered within the context of the business‘s strategies: What types of positions are needed; where the talent is needed and where can it be found; the strength of the firm‘s employment ―brand‖; how the talent can be attracted; and who will recruit the talent and make the final hiring decision. Which internal and external sources and methods are used in recruiting will depend on the strategy and goals of the organization, conditions of the labor market, and specifications of the jobs to be filled. Outside candidates are recruited when internal talent is lacking or a firm wants to hire employees with expertise from other organizations for competitive reasons. HR managers have many tools available to them to gauge their efforts and improve their recruiting. Identifying and developing talent is a responsibility of all managers. The first step toward facilitating the career development of women and underrepresented groups is to eliminate barriers to their advancement.

Chapter Objectives

The following objectives are addressed in this chapter:

1. Describe how a firm‘s strategy affects its recruiting efforts, and the elements that are part of a strategic recruiting strategy.

2. Describe the methods firms use to recruit externally and internally.

3. List some of the ways firms can improve their recruiting and the metrics they use to do so.

4. Explain how career management programs integrate the needs of individual employees and their organizations.

5. Explain why recruitment and career development activities focused on diversity and inclusion are important to companies.

Key Terms

Acceptance rate: The percentage of applicants who accept a firm‘s jobs after being offered them.

Applicant tracking system (ATS): A system recruiters use to post job openings, screen résumés and uploaded profiles, contact via email potential candidates for interviews, and track the time, costs, and other metrics related to hiring people.

Branding: A company‘s efforts to help existing and prospective workers understand why it is a desirable place to work.

Career paths: Lines of advancement in an occupational field within an organization.

Career plateau: A situation in which for either organizational or personal reasons the probability of moving up the career ladder is low.

Demotion: A downward transfer that moves an individual into a lower-level job that can provide developmental opportunities.

Employee leasing: The process of dismissing employees who are then hired by a leasing company (which handles all HR-related activities) and contracting with that company to lease back the employees.

Employee profiles: A profile of a worker developed by studying an organization‘s top performers to recruit similar types of people.

Independent contractors: Workers who are self-employed and do project work on a contract basis for different organizations.

Internal labor markets: Labor markets in which workers are hired into entry-level jobs and higher-level jobs are filled from within.

Job progressions: The hierarchy of jobs a new employee might experience, ranging from a starting job to jobs that successively require more knowledge and/ or skill.

Mentors: Individuals who coach, advise, and encourage employees of a lesser rank.

Mobile recruiting: The process of recruiting candidates via their mobile devices.

Nepotism: A preference for hiring the relatives of current employees

Nine-box grid: A comparative diagram that includes appraisal and assessment data to allow managers to easily see an employee‘s actual and potential performance.

Outplacement services: Services provided by organizations to help terminated employees find a new job.

Passive jobseekers: People who are not looking for jobs but could be persuaded to take new ones given the right opportunity.

Promotion: A change of assignment to a job at a higher level in the organization.

Quality-of-fill: A metric that measures how well new hires have gotten ―up to speed,‖ are performing, and their retention levels.

Realistic job preview (RJP): Informing applicants about all aspects of the job, including both its desirable and undesirable facets.

Recruiting process outsourcing (RPO): The practice of outsourcing an organization‘s recruiting function to an outside firm.

Re-recruiting: The process of keeping track of and maintaining relationships with former employees to see if they would be willing to return to the firm

Reverse mentoring: A program whereby younger employees are called on to mentor older employees and executives about social media trends, new technology, and marketplace trends.

Sabbatical: An extended period of time in which an employee leaves an organization to Time-to-fill: Metrics that refer to the number of days from when a job opening is approved to the date a person accepts the job and begins it.

Transfer: The placement of an employee in another job for which the duties, responsibilities, status, and pay and benefits are approximately equal to those of the previous job the person held.

Virtual job fair: Job fairs conducted online.

Yield ratio: The percentage of applicants from a particular source that make it to the next stage in the selection process.

What's New in This Chapter

The following elements are improvements in this chapter from the previous edition:

Chapter # New component(s)

Chapter 5 ● Expanded discussion about the benefits and challenges of having open-ended application collection.

Chapter 5 ● New facts related to online recruiting and social media examination.

Chapter 5 ● Language adjustments to focus on inclusivity.

Chapter 5 ● New information about veteran job seekers and the VETS agency who helps place veterans in jobs.

Chapter Outline

The following outline organizes activities (including any existing discussion questions in PowerPoints or other supplements) and assessments by chapter (and therefore by topic), so that you can see how all the content relates to the topics covered in the text.

CO 5.1: Describe how a firm’s strategy affects its recruiting efforts, and the elements that are part of a strategic recruiting strategy.

5.1. Business Strategies and Their Link to Strategic Recruiting

l. Decisions about talent need to be considered within the context of your business’s strategies and priorities.

5.1A. Elements of a Recruiting Strategy

l. The elements include:

 the strength of the firm’s employment ―brand‖

 the types of positions the company is recruiting for

 where it needs them

 when it needs them

Figure 5.1

 who is responsible for doing the recruiting and making the recruiting decision.

ll. More than one recruiting strategy can be used at a time, and an organization should continuously refine its recruiting efforts.

(Optional) Knowledge Check: <5 minutes total.

Use Figure 5.1 to discuss the elements of a recruitment strategy. As you discuss the elements in this section, ask students to select the best strategy. Is the same element always the most important?

a. Brand: How Do We Attract Talent?

 Branding is a company’s efforts to help existing and prospective workers understand why it is a desirable place to work.

 Companies with a strong brand have lower hiring costs and less turnover than companies with a weak brand.

 Branding is particularly helpful in other countries where applicants aren’t familiar with the company. Methods include:

o Reach out via social networks such as LinkedIn and Facebook.

o Consider applicants to be like customers and provide what they need.

o set up ―storefronts‖ in major cities to promote brands.

 Create online games.

 Participate in philanthropic activities.

b. Focus: What Types of Positions Are Needed?

 The condition of the labor market affects recruiting plans.

 During periods of high unemployment, an organization can fill its needs from unsolicited résumés and applications and from internal labor markets.

 Internal labor markets are labor markets in which workers are hired into entrylevel jobs and higher-level jobs are filled from within.

 In a tight labor market with low unemployment, the employer might advertise heavily and use local employment agencies.

c. Location: Where Do We Need the Talent, and Where Will We Find It?

 Internal candidates are found inside the firm. External candidates are found outside the firm.

 Several recruiting location characteristics can be considered:

d. Internal versus external recruiting markets: Recruiting internally is generally easier, faster, and less expensive.

 Applicants hired externally can be a source of new ideas, creativity, the latest knowledge, and revenue from loyal clients.

e. Regional recruiting markets: Competing firms are often located in the same areas because the resources they need are located in some areas and not others.

f. Global recruiting markets: Global organizations recruit globally.

 Firms want to attract the best workers wherever they may be

 Employers also have to take into account\ different labor costs, preemployment and compensation practices, and cultural differences

g. Timing: When Do We Need the Talent? HR professionals should understand their firm’s business strategies to recruit at the appropriate times, resulting in several actions:

 Translate succession plans into ongoing recruiting plans.

 Prioritize filling jobs that have the biggest impact on the firm’s financial results.

 Consider the length of the recruiting process.

h. Method: How Do We Find the Talent?

 Firms use different methods to try to recruit different types of people for different jobs.

 The methods also change over time as technology changes and the sources of candidates change.

i. Decision: Who Does the Recruiting and Makes the Final Hiring Decision?

 Organizations that want to focus on their core functions, outsource their recruiting functions to outside firms.

 Recruiting process outsourcing (RPO) is the practice of outsourcing an organization’s recruiting function to an outside firm.

EOC (Optional) Discussion Question #1: 5 minutes total.

Discussion Activity 1

Name some companies with whom you have done business. Then discuss how you view their employer brands. Would you want to work for them or not? How might these firms improve their employer brands?

CO 5.2: Describe the methods firms use to recruit externally and internally.

5.2.

External and Internal Recruiting Methods

l. Employers search for the right employees and the right places to find them.

ll. Applicants looking for the best companies they can find and ways to connect with them.

5.2A. External Recruiting

Methods

l. The external source of applicants varies with the type of position to be filled.

ll. Detailed statistics kept by organizations help human resources managers make better decisions about the sources of new employees.

(Optional) Knowledge Check: <5 minutes total.

Figure 5.2

Use Figure 5.2 to discuss sources of external recruitment. Ask students for examples of external recruiting for jobs they have had and how they expect to find jobs after graduation

a. Advertisements

 Advertising reaches a large audience, but organizations should be selective in placing ads to reach the right people.

 Although preparing an ad can be time consuming, accuracy and completeness are related to recruiting success.

b. Walk-Ins and Unsolicited Applications and Résumés

 Walk-in applicants for hourly wage jobs and unsolicited applications and résumés are common.

 if an employer accepts unsolicited resumes or applications, it should accept all unsolicited resumes or applications, and it should have a written policy for handling them.

c. The Internet: Recruiting Online

 Both companies and applicants find the Internet to be cheaper, faster, and potentially more effective than other methods of finding each other.

 Niche job boards are useful for finding specialized applicants or applicants in a specific industry.

 Recruiters use big data, robots and AI software to find qualified applicants.

d. Social Media

 Firms are using social media to build their brands and recruit applicants.

o LinkedIn is the most popular for recruiters.

 Passive jobseekers are not looking for jobs but could be persuaded to take new ones given the right opportunity.

 A drawback of using social media as a recruiting tool is that some groups of people are underrepresented online: older individuals, people with less than a high school education, and people with disabilities

e. Mobile recruiting: the process of recruiting candidates via their mobile devices.

 Because people are on their phones so much, an organization should have a mobile application that people can use to search for jobs and apply for them.

 Recruiters use text messages to communicate with applicants.

f. Job Fairs attract diverse applicants, but many are not qualified

 A virtual job fair, conducted online, attracts applicants from other geographic areas in a cost-effective way for recruiters and attendees

g. Employee Referrals

 Word-of-mouth recommendations fill most job positions

 A potential negative factor of employee referrals is the possibility of corporate ―inbreeding.‖

 According to the attraction-selection-attrition (ASA) model, inbreeding occurs gradually in a three-stage trend:

 Attraction: People with values similar to an organization’s values are attracted and become employees.

 Selection: These employees then choose applicants similar to themselves.

 Attrition: Employees who do not fit in leave.

h. Nepotism is a preference for hiring the relatives of current employees.

 This can invite charges of favoritism.

i. Re-recruiting or Boomerang: the process of maintaining relationships with former employees to rehire them.

 Recruiting ―boomerang‖ employees has better retention rates.

j. Executive Search Firms: (―headhunters‖) help find the right person for a job.

 The employer pays 25 to 40 percent of the annual salary for filling the position.

 k. Educational Institutions and Career Centers

Figure 5.3

 Educational institutions are a source of young applicants with formal training but little full-time work experience.

 Campus recruiting is a win-win for companies that need talent and schools trying to place students.

(Optional) Knowledge Check: <5 minutes total.

Use Figure 5.3 to discuss methods of strengthening a firm’s relationship with an educational institution Ask students how this can benefit students and employers

l. Work-Study Programs and Internships

Figure 5.4

 To attract high-demand graduates, programs and offer low-interest loans for promising recruits, scholarships, and internships.

 Many internships are unsuccessful because the sponsoring firms haven’t effectively utilized their interns.

(Optional) Knowledge Check: <5 minutes total.

Use Figure 5.4 to discuss the guidelines for an unpaid internship. How does each guideline affect the intern and the company?

m Professional Associations and Labor Unions

 Professional associations and societies offer a placement service to members as one of their benefits.

 Labor unions are a source of applicants for blue-collar and some professional jobs.

n Public Employment Agencies

 Each states maintains an employment agency that administers its unemployment insurance program, matches unemployed applicants with job openings, and assists employers with apprenticeship programs, employment testing, job analysis, evaluation programs, and community wage surveys.

o. Private Employment Agencies: match people with full-time jobs for a fee.

 It charges employers a 25 to 30 percent fee based on the position‘s annual salary if the employer hires an applicant found by the agency.

 Private employment agencies often specialize in specific occupational or geographic areas

p. Staffing Agencies hire and place workers in temporary positions for short-term assignments.

 ―Temps‖ give organizations added flexibility, but they have less incentive to be loyal or to perform well.

q. Independent contractors: self-employed workers who do project work on a contract basis for different organizations.

 Independent contractors give organizations added flexibility, but they have less incentive to be loyal or to perform well.

 The U.S. Supreme Court has ruled that there is no single test to determine whether an employee is an independent contractor or not.

r. Employee leasing: dismissing employees who are hired by a leasing company (which handles all HR-related activities) and contracting to lease back the employees.

 Employee leasing has grown rapidly.

5.2B. Internal Recruiting Methods

l. Most companies try to fill job vacancies above the entry-level position through promotions and transfers for several reasons:

Figure 5.5

 Internal candidates are readily available, they get up to speed faster, and there is less uncertainty about how they will perform.

 Advertisements, which can be costly, are not needed.

 An organization can capitalize on the investment it has made in recruiting, selecting, training, and developing its current employees.

 It can improve morale and support employee engagement. (Optional) Knowledge Check: <5 minutes total.

Use Figure 5.5 to discuss warning signs of a weak internal talent pool. Ask students how a company can improve its talent pool. Students should consider training, education, and applicants with better qualifications

a. Internal Job Postings

 Internal job postings are a quick way to find qualified employees interested in a position.

 Technology can be used to track employees through the process.

b. Identifying Talent through Performance Appraisals

Figure 5.6

 A nine-box grid: a comparative diagram with appraisal and assessment data

 Managers see an employee’s actual and potential performance. (Optional) Knowledge Check: <5 minutes total.

Use Figure 5.6 to discuss the information in a nine-box grid.

c. Skills Inventories, Replacement Charts, and Succession Plans: track data about an employee, including education, past work experience,

 More firms are electronically capturing the qualifications of their employees. EOC (Optional) Discussion Question #2: 5 minutes total.

Discussion Activity 1

Think of a new type of business you would like to start up or manage. Which sources would you use to recruit employees who could help you make it a success?

CO 5.3: List some of the ways firms can improve their recruiting and the metrics they use to do so.

5.3. Improving the Effectiveness of Recruiting

l. How can a firm improve its recruiting?

 Acquire an accurate job analysis.

 Involve line managers and employees.

 Establish a job-starting date that works for the organization and the applicant.

 After an applicant is hired, identify ways to improve the recruiting process.

ll. HR managers have many tools to gauge their efforts and improve recruiting.

5.3A.

Using Realistic Job Previews

l. A realistic job preview (RJP) informs applicants about all aspects of the job, including both its desirable and undesirable facets.

ll. RJPs reduce turnover.

EOC (Optional) Discussion Question #3 >5 minutes total.

Discussion Activity 2

Explain how realistic job previews (RJPs) operate. As a manager or business owner, would you use them?

Answer: The purpose of a realistic job preview (RJP) is to provide job applicants with information concerning all aspects of the job, including both its desirable and undesirable facets. The RJP might also include a tour of the working area, combined with a discussion of any negative health or safety considerations and time to talk candidly with the firm’s employees about the upsides and downsides of the job. Students’ answers will vary as to whether they would use an RJP. Proponents of RJPs believe that applicants who are given them are more likely to remain on the job. and be successful because they will experience fewer unpleasant surprises. Yet some companies avoid RJPs because they worry that presenting both the positive and negative aspects of a job could discourage job applicants

5.3B.

Surveys and Employee Profiles

l. Survey managers about their satisfaction with the recruiting process and develop employee profiles.

ll. An employee profile of a worker: developed by studying an organization’s top performers to recruit similar types of people.

5.3C. Recruiting Metrics

5.7

l. Recruiters should keep statistics on the sources from which candidates are recruited and hired as well as the costs of each source.

a. Time-to-fill metrics: the number of days from when a job opening is approved to the date a person accepts the job and begins it.

(Optional) Knowledge Check: <5 minutes total.

Use Figure 5.7 to discuss how time-to-fill metrics are calculated

b, Quality-of-fill metrics: measure how well new hires have gotten ―up to speed,‖ are performing, and their retention levels.

Quality of fill = (PR + HP + HR) ÷ N where

Figure

PR = Average job performance rating of new hires

HP = Percentage of new hires reaching acceptable productivity within acceptable timeframe

HR = Percentage of new hires retained after 1 year

N = Number of performance indicators

c. Yield Ratio: the percentage of applicants from a particular source that make it to the next stage in the selection process.

 Yield ratios help indicate which recruitment sources are most effective at producing qualified job candidates.

d. Acceptance Rate: the percentage of applicants who accept a firm’s jobs after being offered them.

e. Cost of Recruitment:

Total recruiting costs ÷ Number of people hired = Average recruiting cost per hire

 The applicant tracking system (ATS): recruiters post job openings, screen résumés and uploaded profiles, contact via email potential candidates for interviews, and track the time, costs, and other metrics related to hiring people.

5.3D. Retention: How Do We Keep Our Talent?

l. Leadership is the key reason for turnover.

ll. Supervisors have to demonstrate interest in and empathy toward their employees and help then grow and develop.

lll. People quit their jobs because they think their input isn’t valued.

CO 4.4: Explain how career management programs integrate the needs of individual employees and their organizations.

5.4. Career Management: Developing Talent over Time Figure 5.8

l. Proactive companies see career development and recruiting functions as a strategic imperative and, therefore, as an ongoing process.

ll. Good managers ―grow‖ talent by listening to their employees‘ aspirations, act as coaches, identify their strengths and areas for improvement, and offer feedback. (Optional) Knowledge Check: <5 minutes total.

Use Figure 5.8 to discuss the steps in the career management process.

5.4A. The Goal: Matching the Needs of the Organization to the Needs of Employees

l. A career development program: matches the needs of the organization with the needs of employees as those needs change.

a. The Employee’s Role: an active role in planning careers.

 Managers can offer: continual feedback about performance and providing selfassessment tools, training, and information about the organization and career paths within it.

b. The Organization’s Role: Establishing a Favorable Career Development Climate

 Senior line managers and HR department managers should work together to design and implement a career development system that reflects the goals and culture of the organization.

c. Blending the Goals of Individual Employees with the Goals of the Organization

Figure 5.9

 Employees should have a good understanding of the goals of their firms so they can set career goals that match the needs of the firm.

(Optional) Knowledge Check: <5 minutes total.

Use Figure 5.9 to discuss the relationship between individuals and the organization’s needs

5.4B. Identifying Career Opportunities and Requirements

Figure 5.10

 To identify career opportunities and requirements, managers have to analyze the competencies required for jobs, progression among related jobs, and supply of ready (and potential) talent available to fill those jobs.

a. Begin with a Competency Analysis

 Firms analyze jobs carefully to identify and assign weights to the knowledge and skills that each one requires.

b. Identify Job Progressions and Career Paths

 Job progressions: the hierarchy of jobs a new employee might experience,

 Career paths: lines of advancement in an occupational field within an organization.

(Optional) Knowledge Check: <5 minutes total.

Use Figure 5.10 to discuss career paths in an organization

 A promotion: a change of assignment to a job at a higher level in the organization.

 A transfer: the placement of an employee in another job for which the duties, responsibilities, status, and pay and benefits are approximately equal to those of the previous job the person held.

 A demotion: a downward transfer that moves an individual into a lower-level job that can provide developmental opportunities.

 Outplacement services: provided by organizations to help terminated employees find a new job.

c. Track Employees’ Career Stages

Figure 5.11

 Knowledge, skills, abilities, and attitudes as well as career aspirations change with age and maturity.

d. Offer Different Career Paths

 Career advancement can promote employees out of their area of specialization into management.

 Dual career paths, or tracks, provide for progression in special areas with compensation comparable to that received by managers.

 Fast-track programs give employees exposure to different types of jobs.

 Rapid movement to managerial positions in different functions.

5.4C. Career Development Initiatives

l. Employers can take action to prevent employees from leaving.

a. Career Counseling

 Employers can help employees create an action plan or employers can institute a career self-management program.

b. Mentoring Programs

 Mentors: individuals who coach, advise, and encourage employees of a lesser rank.

 Reverse mentoring: younger employees mentor older employees and executives about social media trends, new technology, and marketplace trends. Informal mentoring occurs as well.

c. Tuition Assistance Programs

 Large corporations offer their employees tuition assistance to help them further their careers if they take courses related to the firms’ businesses.

 The terms of the programs vary as do the reimbursements

d. Career Plateau Initiatives: a situation in which, the probability of moving up the career ladder is low.

5.12

 Three types of plateaus:

o Structural plateau marks the end of promotions.

o Content plateau: a person has learned a job too well and is bored

o Life plateau is more profound and may feel like a midlife crisis.

 A sabbatical is an extended period of time in which an employee leaves an organization to pursue other activities and later returns.

 Sabbaticals can help prevent employee burnout and increase loyalty to a company EOC (Optional) Discussion Question #4: 5 minutes total.

Discussion Activity 3

How can a career management program help an organization forced to downsize its operations?

CO 5.5: Explain why recruitment and career development activities focused on diversity and inclusion are important to companies.

5.5. Developing a Diverse Talent Pool

l. A diverse talent pool helps organizations meet their legal obligations.

ll. It also helps organizations target customers and enables them to find the best employees.

5.5A. Women

l. Women are the largest of the protected classes.

ll. Stereotypes are a major employment obstacle for women.

a. Eliminating Women’s Barriers to Advancement

 Practices that hinder the upward mobility of qualified women and minorities create glass ceilings that prevent promotions to an organization’s upper management.

 Glass ceiling audits are conducted by the Department of Labor.

b. Accommodating Families

 One of the major problems women have faced is balancing their careers with their families.

 Many employers have launched programs such as alternative career paths, extended leave, flextime, job sharing, and telecommuting.

 Retaining employees who are part of dual-career couples can also be a challenge.

5.5B. Minorities

l. Many members of minority groups have experienced social and economic improvements.

ll. Online job boards, social media, internships, and company networks for minority employees provide ways to reach potential employees who are members of minority groups.

5.5C. People Who Are Disabled

l. Many unemployed people who have a disability want to work.

ll. The Job Accommodation Network (JAN), sponsored by the U.S. Department of Labor, is a site that connects disabled jobseekers with employers.

5.5D. Veterans

l. The federal government requires firms that do business with it to hire a certain percentage of workers who are veterans.

ll. Numerous websites are dedicated to recruiting veterans.

5.5E. Older Employees

l. More people over 65 continue to work.

ll. They make good employees because they have experience, they are reliable, and they are more likely to remain with the company.

lll. Age discrimination is still a problem.

EOC (Optional) Discussion Question #5: 5 minutes total.

Discussion Activity 4 What barriers to career advancement do women and minorities face?

Discussion Questions

1. Question: Name some companies with whom you have done business. Then discuss how you view their employer brands. Would you want to work for them or not? How might these firms improve their employer brands?

Suggested Answer: Individual responses will vary. After students have answered, ask them why they felt the way they did about the firms. If they stated that they viewed certain organizations favorably, then ask them if they have ever applied for a job at a given place because of its ―brand‖ but later found that the reality was different.

2. Question: Think of a new type of business you would like to start up or manage. Which sources would you use to recruit employees who could help you make it a success?

Suggested answer: Individual responses will vary. The sources students select should match the skills needed for the business.

3. Question: Explain how realistic job previews (RJPs) operate. As a manager or business owner, would you use them?

Suggested answer: The purpose of a realistic job preview (RJP) is to provide job applicants with information concerning all aspects of the job, including both its desirable and undesirable facets. The RJP might also include a tour of the working area, combined with a discussion of any negative health or safety considerations and time to talk candidly with the firm’s employees about the upsides and downsides of the job.

Students’ answers will vary as to whether they would use an RJP. Proponents of RJPs believe that applicants who are given them are more likely to remain on the job and be successful because they will experience fewer unpleasant surprises. Yet some companies avoid RJPs because they worry that presenting both the positive and negative aspects of a job could discourage applicants.

4. Question: How can a career management program help an organization forced to downsize its operations?

Suggested answer: A career management program can enable managers to utilize the KSA of its retained employees more effectively and can provide assistance to those who must be discharged. By providing assistance, the organization not only performs a service to the individual but also improves the image of the organization. In better times, ex-employees may want to return.

5. Question: What barriers to career advancement do women and minorities face?

Suggested answer: A major employment obstacle for women, both skilled and unskilled, is the stereotyped thinking that persists within our society. Women traditionally have been at a disadvantage because they have not been part of the socalled ―good old boys’ network.‖ That network is an informal one of interpersonal

relationships that has traditionally provided a way for senior (male) members of the organization to pass along news of advancement opportunities and other career tips to junior (male) members as well as to recommend them. Women also still make less than men, on average, and sometimes feel as if the workplace is a ―man’s world,‖ and the proportion of women in top echelons of management, although growing, still remains extremely low.

For many minorities, employment opportunities still remain limited because of educational and societal disadvantages. The unemployment rates for minority youths are particularly high

Additional Discussion Questions

The following are discussion questions that do not appear in the text, PPTs, or courseware (if courseware exists) – they are for you to use as you wish. You can assign these questions several ways: in a discussion forum in your LMS; as whole-class discussions in person; or as a partner or group activity

The following are activities and assignments developed by Cengage but not included in the text, PPTs, or courseware (if courseware exists) S– they are for you to use if you wish.

6. Question: Why should a company hire older workers?

Suggested answer: For one, because they have proven employment experience, are reliable, and are more likely to remain with a firm than job hop. They are also an excellent recruitment source to staff part-time and full-time positions that are otherwise hard to fill. Independent contracting or consulting, on-call work (such as substitute nursing or teaching), and temporary work in administrative or IT roles are examples. Some retirees return or stay in the workforce at the request of their employers, who cannot afford to lose the knowledge accumulated by longtime employees or their reliable work habits that have a positive effect on the entire work group.

Additional Activity

The following are activities and assignments developed by Cengage but not included in the text, PPTs, or courseware (if courseware exists) – they are for you to use if you wish.

Glass

Ceiling Audits

Invite the Human Resources Officer from J.C. Penney or Walmart to speak to the class in-person or over Zoom addressing their glass ceiling audits. Students will prepare questions in advance to ask the HR officer.

Background: Organizations are increasingly conducting their own glass ceiling audits prior to government review to avoid fines and externally imposed corrective action. These audits can

document any ceilings and the reasons they exist. Self-audits are one step toward tapping the potential of a diversified workforce. Following the largest class-action suit ever brought in the United States, Walmart began conducting self-audits. The company now has certain promotion goals for women and other underrepresented groups. For example, if 40 percent of the qualified people who apply for assistant store manager positions are women, 40 percent of those hired should be women. JCPenney created advisory teams to help increase the representation of underrepresented groups at the senior management level and to find ways to make the company‘s affirmative action plan more effective.

Case Study 1: A Lifecycle Approach to Talent

1. Question: In what ways does the Scripps lifecycle approach lead to a more diverse workforce?

Suggested answer: Students’ answers will vary. The Scripps lifecycle approach supports diversity by enabling employees to continue working by adapting a work schedule to suit the employees’ needs.

2. Question: Why are managers increasingly being encouraged to act as coaches? Do you see any problems with a manager acting as both a coach and a supervisor?

Suggested answer: Student‘s answer will vary. Some students may say that employees want support and encouragement that a coach provides rather than orders from a boss.

Case Study 2: Homegrown Talent: Mary Barra Rises to GM’s Top Post

1. Question: Mary Barra‘s father worked at General Motors. Was her hiring an example of nepotism? If you were a business owner, would you want to hire relatives of your employees? What would the pros and cons of doing so be?

Suggested answer: Students’ answers will vary. Hiring Mary Barra at GM is an example of nepotism. Some students might say that as a business owner, they would hire a relative of an employee. The pros of this decision could be that the employee could be familiar with the company and the way it functions. However, this could be a con because the employee might be overconfident about the skill sets. Ideally, candidates should be hired based on the merit of their performance.

2. Question: What role did Mary Barra play in advancing her career? What role did GM play in ―growing‖ her career?

Instructor Manual: Snell/Morris, Managing Human Resources 19e, c23, ISBN: 9780357716519; Chapter #1: The Opportunities and Challenges of Human Resources Management

Suggested answer: Student’s answer will vary. Some students may say that Barra was able to advance her career because she was able to perform well in multiple roles, which GM offered her. In this way, she was able to understand the business well and it helped her become the CEO of the company.

Additional Resources

Cengage Video Resources



MindTap Videos:

o Chapter 05: Concept Clip: Selection Tools

o Chapter 05: On The Job: Money Desktop- Recruiting

Chapter 06: Employee Selection Instructor Manual

Snell/Morris, Managing Human Resources 19e, c23, ISBN: 9780357716519; Chapter #6: Employee Selection

Table of Contents

Purpose and Perspective of the Chapter 83

Chapter Objectives 83

Key Terms 83

What's New in This Chapter 84

Chapter Outline 85

Discussion

Questions……………………………………………………………………………………………

Discussion Questions 92 Additional Activities and Assignments 93

Case Study 1: Job Candidate Assessment Tests Go

3

Case Study 2: Pros and Cons of Cleaning Up the ―Resu-mess‖……………………………………………14 Additional Resources 94

Instructor Manual: Snell/Morris, Managing Human Resources 19e, c23, ISBN: 9780357716519; Chapter #1: The Opportunities and Challenges of Human Resources Management

Purpose and Perspective of the Chapter

The employee selection process should start with a job analysis. The steps in the selection process and their sequence will vary, not only with the organization, but also with the type and level of jobs to be filled. The employee selection process should provide reliable and valid information about applicants so that their qualifications can be carefully matched with the job‘s specifications. The information that is obtained should be clearly job related, predict success on the job, and be free from discrimination.

Reliability refers to the consistency of test scores over time and across measures. Validity refers to what a test or other selection procedure is supposed to measure and how well it actually measures it. Initial applicant screening tools include résumés and cover letters, application forms, references, Internet checks and phone screening, and sometimes short electronic questionnaires. Preemployment tests are more objective than interviews and can give managers a fuller sense of the capabilities of different candidates. A wide range of tests exist. In the process of making decisions, all ―can do‖ and ―will-do‖ factors should be assembled and weighted systematically so that the final decision can be based on a composite of the most reliable and valid information.

Chapter Objectives

The following objectives are addressed in this chapter:

1. Explain what the objectives of the employee selection process are, its steps, and why the information gathered during the process must be reliable and valid.

2. Describe the tools used to screen applicants, the types of employment interviews and methods to administer them, and the post-interview screening tools firms use.

3. Compare the value of different types of employment tests and how to assess their reliability and validity

4. Explain how firms evaluate the information they collect on candidates and the decision strategies they use to select employees.

Key Terms

Assessment center test: A process by which managerial candidates are evaluated at an assessment center as they participate in a series of situations that resemble what they might need to handle on the job

Automated interview: Interviews in which the questions are administered to applicants via computers. The interviews can be conducted at a firm‘s facilities, using kiosks, online, or via phone

Behavioral description interview (BDI): An interview in which an applicant is asked questions about what he or she actually did in a given situation

Compensatory model: A selection decision model in which a high score in one area can make up for a low score in another area

Concurrent validity: The extent to which the test scores of current employees correlate with their job performance

Construct validity: The extent to which a selection tool measures a theoretical construct or trait

Content validity: The extent to which a selection instrument, such as a test, adequately samples the knowledge and skills needed to do a particular job

Criterion-related validity: The extent to which a selection tool predicts, or significantly correlates with, important work behaviors

Cross-validation: Verifying the results obtained from a validation study by administering a test or test battery to a different sample (drawn from the same population)

Multiple cutoff model: A selection decision model that requires an applicant to achieve some minimum level of proficiency on all selection dimensions

Multiple hurdle model: A selection decision model in which only the applicants with the highest scores at an initial test stage go on to subsequent stages

Negligent hiring: The failure of an organization to discover, via due diligence, that an employee it hired had the propensity to do harm to others

Nondirective interview: An interview in which the applicant is allowed the maximum amount of freedom in determining the course of the discussion, while the interviewer carefully refrains from influencing the applicant‘s remarks

Panel interview: An interview in which a board of interviewers questions and observes a single candidate

Predictive validity: The extent to which candidates‘ test scores match criterion data obtained from them after they have been hired and on the job for a period of time

Preemployment test: An objective and standardized test used to gauge a person‘s knowledge, skills, abilities, and other characteristics (KSAOs) relative to other individuals

Reliability: The degree to which an interview, test, or other selection procedures result in consistent information about a candidate

Remote or virtual interviews: Interviews conducted via videoconferencing or over the Web

Selection: The process of choosing individuals who are qualified to fill existing or projected job openings

Selection ratio: The number of applicants compared with the number of people to be hired

Sequential interview: A format in which a candidate is interviewed by multiple people, one right after another

Situational interview: An interview in which an applicant is given a hypothetical incident and asked how he or she would respond to it

Structured interview: An interview in which a set of standardized questions having an established set of answers is used

Validity: The degree to which a test or selection procedure actually measures or predicts a person‘s ability to do a job

Video résumés: Short video clips that highlight applicants’ qualifications beyond what they can communicate on their resumes.

What's New in This Chapter

The following elements are improvements in this chapter from the previous edition:

Chapter # New component(s)

Chapter 6 ● New information regarding remote and virtual interviews, particularly in response to the COVID-19 pandemic.

Chapter 6 ● New tips for conducting effective interviews.

Chapter Outline

The following outline organizes activities (including any existing discussion questions in PowerPoints or other supplements) and assessments by chapter (and therefore by topic), so that you can see how al the content relates to the topics covered in the text.

CO 6.1. Explain what the objectives of the employee selection process are, its steps, and why the information gathered during the process must be reliable and valid.

6.1. Overview of the Selection Process

l. Selection: the process of choosing individuals who are qualified to fill existing or projected job openings

(Optional) Knowledge Check: <5 minutes total.

Use Figure 6.1 to discuss the overall goal of selection maximizing hits and avoiding misses.

6.1A. Begin with a Job Analysis

Figure 6.1

l. Job specifications help identify the competencies employees need for success the knowledge, skills, abilities, and other factors (KSAOs) that lead to superior performance.

ll. This is referred to as ―person-job fit.

lll. Involved line managers, interviewers, and HR personnel should be familiar with the job opening and its KSAOs.

lV Values-based hiring: organizations hire individuals with the same values and cultures, but this leads to a lack of diversity.

6.1B. Steps in the Selection Process

Figure 6.2

l. Treating all applicants alike ensures that none receives special treatment and the best candidate is hired.

(Optional) Knowledge Check: <5 minutes total.

Use Figure 6.2 to discuss the major steps in the selection process. Emphasize that the order may vary and that some steps may be omitted. In some situations, a person goes through all the steps, whereas in others, a candidate may be rejected after one or two steps.

6.1C. Obtaining Reliable and Valid Information

l. Reliability is the degree to which an interview, test, or other selection procedures result in consistent information about a candidate

ll, Interrater reliability agreement among two or more raters is one measure of a method’s consistency.

lll. Validity is the degree to which a test or selection procedure accurately measures what it intends to, and accurately predicts how well a person performs on the job.

EOC (Optional) Discussion Question #1: 5 minutes total.

Discussion Activity 1

Is there a “best” employment process stepwise? What steps must come first and last?

CO 6.2. Describe the tools used to screen applicants, the types of employment interviews and methods to administer them, and the post-interview screening tools firms use.

6.2. Initial Screening

l. Many methods screen out unqualified applicants.

6.2A. Initial Screening Methods:

a. Cover Letters and Résumés: used to assess applicants for salaried positions

 Well-written cover letters are important if a requirement of the job is having good written communication skills.

 A customized cover letter shows genuine interest (Optional) Knowledge Check: <5 minutes total.

Use Figure 6.3 to discuss how to assess résumés objectively

b. Internet Checks: researching candidates on social media has three problems:

 Authenticity is questionable.

 Information isn’t job related.

 Discrimination against protected classes can result.

. c. Phone and Video Screening

 Video résumés: short video clips that highlight applicants’ qualifications beyond what they can communicate on their résumés.

 Companies should be careful to consider only job-related qualifications.

d. Application Forms: ask about the applicant’s job qualifications

 Employers must ask only job-related questions and follow state laws

CO 6.3: Compare the value of different types of employment tests and how to asses their reliability and validity.

6.3

6.3. Employment Interviews: subjective and poor at predicting performance. Figure 6.4

l. The interview is used for three reasons:

Figure

 They are practical when there are only a small number of applicants.

 They serve other purposes, such as public relations.

 Interviewers trust their judgment

ll. Tips for interviews:

 Be prepared

 Be respectful

 Build rapport

 Communicate well and often

 Review your work.

(Optional) Knowledge Check: <5 minutes total.

Use Figure 6.4 to discuss the variables in the employment interview. Ask students how one or more variables affect the process

6.3A.

Types of Interviews

l. Structure determines the actions of the interviewer.

ll. The more structure an interview has, the more the interviewer directs it.

a. Nondirective Interviews: the applicant determines the course of the discussion without the interviewer’s remarks.

b. Structured Interviews: standardized questions with an established set of answers

c. Situational Interviews: an applicant gets a hypothetical incident and is asked how to respond to it.

d. Behavioral Description Interview (BDI): an applicant is asked about what was done in a given situation.

e. Sequential and Panel Interviews: a candidate is interviewed by multiple people, one after another

f. A panel interview: a board of interviewers questions and observes a single candidate.

6.3B.

Methods for Administering Interviews

l. Most interviews take place in person.

ll. They can be administered in ways to broaden the talent pool and make interviewing easier, faster, and less costly

a. Remote or Virtual Interviews

 Remote interviews via video are convenient, low cost, and make it easier to interview people in different geographic areas

 After the Covid-19 pandemic, 86 percent of companies use virtual interviews

 The results can be mixed.

 The remote interview has the potential to minimize the power differential between the interviewer and the interviewee.

b. Automated interview: pre-recorded questions that interviewees need to answer, on video

6.3C. Diversity Management: Could Your Questions Get You into Legal Trouble?

l. The EEOC discourages direct or indirect questions related to race, color, age, religion, sex, sexual orientation, national origin, caregiver status, and gender identity.

EOC (Optional) Discussion Question #2: 5 minutes total.

Discussion Activity 2

Compare briefly the major types of employment interviews described in this chapter. Which type would you prefer to conduct? Why?

6.4. Post-Interview Screening

After a candidate has been interviewed and appears to be a good potential new hire, information about the person‘s previous employment as well as other information provided by the applicant is investigated.

6.4A Reference Checks: Organizations check references in many ways phone checks

6.4B. Background Checks

l. State courts have ruled that companies can be held liable for negligent hiring if they fail to do adequate background checks.

ll. Negligent hiring: the failure of an organization to discover, via due diligence, that an employee it hired had the propensity to do harm to others.

a. Criminal Records Checks

 If criminal histories are taken into account, employers must consider the nature of the job.

 Federal law does not prohibit employers from asking job candidates about their criminal history.

 EEO laws prohibit employers from discriminating when they use criminal history information

b. Credit Checks: sometimes performed when they are not job relate

 Some states prohibit the practice.

6.5. Preemployment Tests: objective and standardized tests used to gauge (KSAOs) relative to others Figure

6.5

l. It can be legally challenged, and it requires time and money.

6.5A. Types of Tests: Different tests can be used

 Job Knowledge Tests: achievement tests to measure understanding, or knowledge, about a job.

 Work Sample Tests: require the applicant to perform tasks that are required on the job

 Assessment Center Tests: managerial candidates are evaluated at an assessment center as they participate in situations that resemble the job.

 Cognitive Ability Tests: measure mental capabilities such as general intelligence, verbal fluency, numerical ability, and reasoning ability.

 Biographical Data (Biodata) Tests ask questions about events and behaviors that reflect attitudes, experiences, interests, skills, and abilities

o The pattern of responses enables the prediction of success on the job.

 Personality and Interest Inventories Five dimensions can summarize personality traits:

o Extroversion the degree to which someone is talkative, sociable, active, aggressive, and excitable

o Agreeableness the degree to which someone is trusting, amiable, generous, tolerant, honest, cooperative, and flexible

o Conscientiousness the degree to which someone is dependable and organized and perseveres in tasks

o Neuroticism the degree to which someone is secure, calm, independent, and autonomous

o Openness to experience the degree to which someone is intellectual, philosophical, insightful, creative, artistic, and curious

 Polygraph Tests: devices that measures the changes in breathing, blood pressure, and pulse of a person who is being questioned

o Normally, they are used only for law-enforcement personnel and highsecurity CIA- and FBI-type jobs.

 Honesty and Integrity Tests: predict job performance, while some studies disagree.

 Physical Ability Tests: Strength and endurance tests are valid for jobs such as firefighting.

o They must be used carefully to be fair for all applicants.

 Medical Examinations: The law prohibits medical examinations before an applicant receives a conditional employment offer and agrees to the examination. All exams must be related to job responsibilities

 Drug Tests: Different states have different laws regarding drug testing. Companies should follow procedures established by the Substance Abuse and Mental Health Services Administration (SAMHSA).

6.5B. Determining the Validity of Tests: different approaches to validating tests

l. Criterion-Related Validity: The extent to which a selection tool predicts, or significantly correlates with, important work behaviors

ll. The two types of criterion-related validity: concurrent and predictive.

 Concurrent validity: the extent to which the test scores of current employees correlate with their job performance.

 Predictive validity: the extent to which candidates’ test scores match criterion data after they have been hired and on the job.

lll. Regardless of the method used, cross-validation is essential.

 Cross-validation: verifying the results from a validation study by administering a test or test battery to a different sample . Figure 6.6

(Optional) Knowledge Check: <5 minutes total.

Use Figure 6.6 to discuss the types of validity used.

EOC (Optional) Discussion Question #4: 5 minutes total.

Discussion Activity 4

What is meant by the term criterion as it is used in personnel selection? Give some examples of criteria used for jobs with which you are familiar

 Content Validity: the extent to which a selection instrument, such as a test, adequately samples the knowledge and skills needed for a job. used when the criterion-related approach is not feasible

 Construct Validity: the extent to which a test measures a theoretical construct, or trait: typical construct intelligence, mechanical comprehension, and anxiety.

CO 6.4: Explain how firms evaluate the information they collect on candidates and the decision strategies they use to select employees.

6.6. Reaching a Selection Decision Figure 6.7, Figure 6.8

6.6A. Summarizing Information about Applicants

l. Systematic organization of the applicants’ information makes it easier to objectively evaluate all applicants.

ll. Evaluation centers on what each applicant can and will do. (Optional) Knowledge Check: <5 minutes total.

Use Figures 6.7 and 6.8 to discuss the importance of can-do and will-do characteristics of an applicant. Ask students how these should be weighed when considering an application

6.6B. Decision-Making Strategy: The strategy used for making personnel decisions is not the same for every job.

l. Questions firms must consider when deciding who to hire:

 Should the individuals be hired according to their highest potential or according to the needs of the organization?

 At what grade or wage level should the individual be hired?

 Should the selection be based on finding an ideal employee or should a candidate‘s potential for advancement in the organization be considered?

 Should unqualified buy trainable individuals be considered?

 Should overqualified individuals be considered?

 What will be the effect on affirmative action, diversity, and inclusion goals?

ll. Clinical Approach: includes many subjective ratings.

 Personal biases might be hidden in clinical terms.

lll. Statistical Approach: uses and weights the most valid predictors. Three models are

 A compensatory model: a selection decision model in which a high score in one area can make up for a low score in another area.

 A multiple cutoff model: a selection decision model that requires an applicant to achieve some minimum level of proficiency on all selection dimensions.

 A multiple hurdle model: a selection decision model in which only the applicants with the highest scores at an initial test stage go on to subsequent stages.

lV. Selection ratio: the number of applicants compared with the number of people to be hired.

 A low selection ratio selects only the best candidates.

6.6C.

Final Decision

l. In large firms, the final decision has several steps:

 Manager selects a candidate and informs HR.

 HR makes a job offer to the candidate, usually by phone. This offer is contingent on passing any required medical exams.

 Medical exams and drug tests are performed.

 HR makes a written offer to the candidate.

 After the candidate accepts the offer, candidates who were not chosen should be informed.

ll. Although the steps may vary for internal candidates, all candidates should be informed when a decision is final.

lll. Treating applicants with respect is important.

lV. Some candidates may be customers or employees in other departments.

 The process should begin with a job analysis that yields a job specification.

 The number of steps and activities involved in the process will vary depending on the job and organization.

 The final step in the process involves systematically reaching a decision.

Discussion Questions

1. Question: Is there a ―best‖ employment process stepwise? What steps must come first and last?

Suggested answer: The process should begin with a job analysis that yields a job specification. The number of steps and activities involved in the process will vary depending on the job and organization. The final step in the process involves systematically reaching a decision.

2. Question: Compare briefly the major types of employment interviews described in this chapter. Which type would you prefer to conduct? Why?

Suggested answer: In highly structured interviews, the interviewer determines the

course that the interview will follow as each question is asked. In the less structured interview, the applicant plays a larger role in determining the course the discussion will take. The major types of employment interviews described in this chapter are nondirective, structured, situational, behavioral description, sequential, and panel interviews. The major difference among them is the degree of structure or control, with the nondirective type having minimal structure. In the structured interview, the interviewer adheres closely to a highly detailed set of questions on specially prepared forms. Students will have different choices for different reasons.

3. What characteristics do job knowledge and job sample tests have that often make them more acceptable to candidates than other types of tests?

Suggested answer: Job knowledge tests and job sample tests are often more acceptable to examinees because they appear to be job related. Job knowledge tests are achievement tests designed to measure people’s level of understanding, or knowledge, about a particular job. Work sample tests, or job sample tests, require the applicant to perform tasks that are actually a part of the work required on the job. Therefore, when both of these tests are constructed from a carefully developed outline that expert agree includes the major job functions, the tests are considered effective, reliable, valid, and fair

4. What is meant by the term criterion as it is used in personnel selection? Give some examples of criteria used for jobs with which you are familiar.

Suggested answer: The term criterion refers to measures of job performance such as production records, supervisor‘s ratings, training outcomes, and other measures of on-the-job success. Students may give several examples of criteria. It is important that they understand that criterion, used in this context, refers to a measure of job success and not to the various types of predictor information (education, job experience, and so on).

Additional Discussion Questions

The following are discussion questions that do not appear in the text, PPTs, or courseware (if courseware exists) – they are for you to use as you wish. You can assign these questions several ways: in a discussion forum in your LMS; as whole-class discussions in person; or as a partner or group activity in class

Question: What characteristics do job knowledge and job sample tests have that often make them more acceptable to candidates than other types of tests?

Suggested answer: Job knowledge tests and job sample tests are often more acceptable to examinees because they appear to be job related. Job knowledge tests are achievement tests designed to measure people‘s level of understanding, or knowledge, about a particular job. Work sample tests, or job sample tests, require the applicant to perform tasks that are actually a part of the work required on the job. Therefore, when both of these tests are constructed from a carefully developed outline that experts agree includes the major job functions. The tests are considered effective and reliable.

Additional Activities and Assignments

The following are activities and assignments developed by Cengage but not included in the text, PPTs, or courseware (if courseware exists) – they are for you to use if you wish.

Step 1: Submit a report on preemployment tests you would use in a company of your choice (such as investment, consulting, banking, contracting, etc.). The report should emphasize the rationale behind the use of those tests and also state their advantages and disadvantages.

Step 2: Share your report to discuss the suitability of the tests.

Case Study 1: Job Candidate Assessment Tests Go Virtual

1. Question: What do you think are the prime advantages and disadvantages of ―virtual tryouts‖?

Suggested answer: Prime advantages of virtual tryouts are that they provide better qualified candidates, faster recruiting, and lower turnover among employees hired. Also, a unique impression among applicants is created as this kind of assessment provides a more realistic job preview and makes them feel like they are being chosen for jobs on more than just their personalities or how they performed during an interview. However, HR experts warn that companies need to be sure they are not simply buying glitzy simulations that do not translate well to the jobs for which they are hiring. Another prime disadvantage is that it could potentially eliminate candidates who have trouble with simulation or computers but might make good employees.

2. Question: Do you think there would be any EEOC concerns regarding this system?

Suggested answer: Although the virtual tryout has its advantages, it must be validated (either by content or criterion-related validity). Certain people who are more nervous in such a setting might be wrongly eliminated from the applicant pool. To avoid EEOC concerns, firms using this approach should definitely check to see the distribution of applicants who do well in this test-taking environment versus those who do better in a traditional interview.

3. Question: Do you think virtual job tryouts might be better suited for some jobs than others? If so, which ones?

Suggested answer: Encourage students who have experienced job tryouts to respond to this question. Given the cost of the equipment, jobs best suited for virtual tryouts would be those that are not likely to change significantly in terms of technology and skill requirements in the short run.

Case Study 2: Pros and Cons of Cleaning Up the “Res

u-mess”

1. Question: What impact do you think résumé screening tools are having on HR departments? What about line managers? Would you use the software to screen résumés?

Suggested answer: Students’ answers may vary. The primary benefit of résumé screening tools is that recruiters’ and managers’ time is freed up time that can be used to pursue hiring the most qualified applicants versus sorting through résumés. Because managers have to spend less time screening applicants, they have more time to spend on tasks like strategy planning and employee training initiatives designed to give the firm an edge over its competitors. The new tools also allow HR managers to recruit more qualified applicants than they might have hired using traditional screening methods. On the other hand, managers tend to pile on huge numbers of keywords so that very few applicants can make it past the screen. There is also a lack of the human touch and judgment in the process. Managers don’t end up seeing interesting résumés résumés from people who have different skills or life experiences that would translate well to the job. Consequently, a lot of people who would make excellent employees never get a glance.

2. Question: How might the drawbacks associated with résumé screening software be addressed?

Suggested answer: The process may not give applicants the feeling that they have had a chance to present themselves accurately. Companies can counter these problems, however, by responding to applicants promptly and dealing with them fairly and politely. For example, the applications of candidates who don’t make the cut could be archived and these people could be re-contacted later should positions open that better fit their skills. Also, instead of posting job ads, recruiters can use social networking sites to get the word out for the types of employees they are looking to hire.

Additional

Resources

Cengage Video Resources

 MindTap Videos:

o Chapter 06: Concept Clip: Discrimination vs. Affirmative Action

o Chapter 06: On The Job: Money Desktop - Interviewing

Chapter 07: Training and Development

Instructor Manual: Snell/Morris, Managing Human Resources 19e, c23, ISBN: 9780357716519; Chapter #1: The Opportunities and Challenges of Human Resources Management

Instructor Manual

Snell/Morris, Managing Human Resources 19e, c23, ISBN 9780357716519; Chapter #7: Training and Development

Table of Contents

Chapter Objectives 96

Key Terms 96

What's New in This Chapter 97

Chapter Outline 97

Discussion

Questions………………………………………………………………………………

Additional Discussion Questions 106

Additional Activities and Assignments 106

Case Study 1: Whirlpool Mixes Up Its Managerial Training: Closed-Looped Method Brings Learning Full Circle……………………………………………………………………………………………… …………….13

Case Study 2: Loews Hotels: Training for Four-Diamond Service and More……………………….13

Additional Resources 107

Cengage Video Resources.................................................................................................................................107

Purpose and Perspective of the Chapter

Companies are realizing that workers need not only operational knowhow but also superior job expertise; knowledge about competitive, industry, and technological trends; and the ability to continually learn, adapt, seek out and utilize new information. These characteristics better help an organization innovate and be more agile to compete in today‘s fast-paced global business world. Because training plays a central role in nurturing, strengthening, and expanding the capabilities of a firm in this way, it has become part of the backbone of strategic management. The types of training given employees range from simple, on-the-job instruction to sophisticated skills training conducted on multimillion-dollar simulators. To be effective, training programs need to be developed systematically. This approach consists of four phases: (1) needs assessment, (2) program design, (3) implementation, and (4) evaluation. l Employers develop different training programs for various purposes. The effectiveness of training can be evaluated on several criteria: participants‘ reactions, the amount of learning they have acquired, their behavioral changes on the job, and bottom-line results such as the program‘s return on investment.

Chapter Objectives

1 Discuss the scope of training and development and its strategic aspects.

2. Describe how a training needs assessment should be done.

3 Describe the factors that must be taken into account when designing a training program.

4. Identify the types of training-delivery methods used by organizations.

5 Describe some of the additional training programs conducted by firms, and why they are important.

6. Explain how the effectiveness of training programs is evaluated.

Key Terms

Adventure-based learning: The use of adventures, such as games, trust activities, and problem solving initiatives, for the personal and social development of participants

Apprenticeship training: A system of training in which a worker entering the skilled trades is given thorough instruction and experience, both on and off the job, in the practical and theoretical aspects of the work

Behavior modeling: A learning approach in which work behaviors are modeled, or demonstrated, and trainees are asked to mimic them

Behavior modification: A technique that operates on the principle that behavior that is rewarded, or positively reinforced, will be exhibited more frequently in the future, whereas behavior that is penalized or unrewarded will decrease in frequency

Blended learning: The use of both in-person classroom learning and online learning

Chief ethics officer: A high-ranking manager directly responsible for fostering the ethical climate within the firm

Chief learning officer: A high-ranking executive responsible for fostering employee learning and development within the firm

Competency assessment: An analysis of the sets of skills and knowledge needed for decision oriented and knowledge intensive jobs

Cooperative training: A training program that combines practical on-the-job experience with formal educational classes

Cross-training: The process of training employees to do multiple jobs within an organization

E-learning: Learning that takes place via electronic media

Experiential learning: The process of learning by ―doing,‖ reflecting on it, critically analyzing it, and applying it in new situations or settings

Instructional objectives: The desired outcomes of a training program

Just-in-time training: Electronic training delivered to trainees when and where they need it to do their jobs

Learning management system (LMS): Online system that provides a variety of assessment, communication, teaching, and learning opportunities

Microlearning: Training sessions that take place in a very short timeframe, usually 5 minutes or less

On-the-job training (OJT): A method by which employees are given hands-on experience with instructions from their supervisor or other trainer

Onboarding: The process of systematically socializing new employees to help them get ―on board‖ with an organization

Organization analysis: An examination of an organization‘s environment, goals, strategies,

Orientation: The formal process of familiarizing new employees with the organization, their jobs, and their work units

Person analysis: The process of determining the specific individuals who need training in an organization

Spot rewards: Programs that award employees on the spot when they do something particularly well during training or on the job

Task analysis: The process of determining a training program‘s content by studying the tasks and duties a job involves

Transfer of training: The effective application of principles learned to what is required on the job

What's New in This Chapter

Chapter # New component(s)

Chapter 7 ● Another learning objective added to highlight the evaluation of training programs.

Chapter 7 ● New paragraph about the training benefits of special assignments.

Chapter 7 ● Simplified section to focus on only the most important content.

Chapter Outline

The following outline organizes activities (including any existing discussion questions in PowerPoints or other supplements) and assessments by chapter (and therefore by topic), so that you can see how all the content relates to the topics covered in the text.

CO 7.1: Discuss the scope of training and development and its strategic aspects.

7.1. The Scope of Training

l. Training tends to be more narrowly focused and oriented toward short-term performance concerns.

ll. Development tends to be oriented more toward broadening an individual’s skills for future responsibilities.

lll. The single phrase training and development recognizes the combination of activities organizations use to increase the knowledge and skills of employees.

Optional) Knowledge Check: <5 minutes total.

What economic, social, and political forces have made employee training even more important today than it was in the past?

Answer: Increased global and domestic competition, rapid advances in technology, mergers and acquisitions, a focus on human-based competition

7.1A. A Strategic Approach to Training

l. Training should be oriented to the organization’s goals.

ll. Chief learning officer: a high-ranking executive responsible for fostering employee learning and development within the firm.

lll. A systematic approach to training has four phases:

 A needs assessment based on the firm’s competitive objectives

 Program design

 Implementation

 Evaluation

EOC (Optional) Discussion Question #1: 5 minutes total.

Discussion Activity 1

What economic, social, and political forces have made employee training even more important today than it was in the past? Use Figure 7.1

CO 7.2: Describe how a training needs assessment should be done.

7.2 Phase 1: Conducting the Needs Assessment Figure 7.2

l. ―Hard skills‖ refer to the tangible and teachable skills needed to do a job.

ll. ―Soft skills‖ refer to subjective skills that are harder to measure, requiring more discretion or judgment.

lll. A training needs assessment should be conducted before training is planned. Optional) Knowledge Check: <5 minutes total.

Use Figure 7.2 to discuss the costs and benefits of conducting needs assessment in-house or using a consultant. Needs assessment consists of three parts: organization, task, and person analyses.

7.2A. Organization Analysis: an examination of an organization’s environment, goals, strategies, performance, and resources to determine what training is needed

l. It’s the first step in training needs assessment.

7.2B. Task Analysis: determining training content by studying the tasks of a job

l. List all the tasks or duties included in the job and the steps needed for each task.

ll. Employees need flexible sets of competencies to adapt to changing conditions.

lll. A competency assessment: an analysis of the skills and knowledge needed for decision-oriented and knowledge-intensive jobs.

7.2C. Person Analysis: determining the specific individuals who need training

EOC (Optional) Discussion Question #2: 5 minutes total.

Discussion Activity 2

What analyses should be done to determine the training needs of an organization? After the needs are determined, what is the next step?

CO 7.3: Describe the factors that must be taken into account when designing a training program.

7.3. Phase 2: Designing the Training Program

l. Training programs should focus on at least four related issues:

 The training’s instructional objectives

 Readiness of trainees and their motivation

 Principles of learning

 Characteristics of instructors

7.3A. Developing Instructional Objectives

l. Instructional objectives are the desired outcomes of a training program. ll. The objectives should be performance centered.

7.3B. Assessing the Readiness and Motivation of Trainees Figure 7.3,

l. To learn, students must be ready and motivated.

 Trainee readiness: the amount experience and knowledge of trainees that make them ready to absorb the training

 Trainee motivation: the reason students want to learn

7.3C. Incorporating Effective Principles of Learning

l. The psychological principles of learning are the characteristics of training programs that help employees grasp new material, make sense of it in their own lives, and transfer it back to their jobs.

Optional) Knowledge Check: <5 minutes total

Use Figure 7.3 to discuss the principles of learning. Set up an example to show how the principles apply to a training task.

a Goal Setting: Explain the goals and objectives of the training or encourage trainees to set goals

b. Meaningfulness of Presentation

 Use terminology that the students understand.

 Connect the training to familiar activities.

 Build each experience on preceding experiences.

c. Modeling: Model the behavior students should learn

d. Individual Learning Differences: Present information in different ways for different learning styles.

e. Active Practice and Repetition: Give Teach a task as steps if it can be broken down into steps. trainees opportunities to practice

f. Experiential Learning: Involve students in the experience

 the process of learning by ―doing,‖ reflecting on it, critically analyzing it, and applying it in new situations or settings.

g. Whole-versus-Part Learning

 Use programmed instruction, which is also referred to as self-paced learning, to break down learning into sequences for employees to learn at their own pace.

h. Massed, Distributed, and Continuous Learning: The amount of time in a training session affects training effectiveness Figure 7.4

 Massed: Long training sessions

 Distributed learning: Spaced out training for faster learning and longer retention

 Continuous learning: An ongoing process whereby employees are continually acquiring new skills and knowledge via training, observing more experienced workers, and asking for help from others when they need it

i. Feedback and Reinforcement from self-monitoring, trainers, and other trainees helps students learn

 Behavior modification: behavior that is rewarded or positively reinforced is exhibited more frequently, whereas behavior that is penalized decreases

 Spot reward: awards employees when they do something particularly well

7.3D. Characteristics of Instructors

l. The success of any training effort will depend in large part on the trainer’s teaching skills and personal characteristics.

EOC (Optional) Discussion Question #3: 5 minutes total.

Discussion Activity 3

Which principles of learning do you see demonstrated in your own classes? In what ways might you bring other principles into them?

CO 7.4: Identify the types of training-delivery methods organizations use.

7.4. Phase 3: Implementing the Training Program Training Delivery Method

Figure 7.5. Figure

7.6

l. The training method you select should match the learning outcome you want. Trainers can use multiple methods, which is known as blended learning.

 On-the-Job Training (OJT): a method by which employees are given hands-on experience with instructions from their supervisor or other trainer Figure 7.7

 Apprenticeship training: a system of training in which a worker entering the skilled trades is given thorough instruction and experience, both on and off the job, in the practical and theoretical aspects of the work.

Optional) Knowledge Check: <5 minutes total. Use Figure 7.7 to discuss the basic steps of an OJT program. Ask students for possible consequences of bad OJT. Waste, inefficiencies, injuries, and death can result from bad OJT.

a. Cooperative Training, Internships, and Governmental Training

 Cooperative training: combines practical on-the-job experience with formal educational classes.

 Internship programs offer students the chance to get real-world experience while finding out how they will perform in work organizations.

 The federal and state governments work with private employers to sponsor training programs for employees at American Job Centers.

b Special Assignments: assigning trainees on managerial tracks to different jobs in different areas, often in different regions and countries.

c. Simulations: used when it is impractical or unwise to train employees on the actual equipment

 Used to help employees and managers make tactical decisions.

d. Games: popular for training purposes the ―gamification‖ of learning.

e. E-Learning: learning that takes place via electronic media.

 A learning management system (LMS): an online system that provides assessment, communication, teaching, and learning

 Many options are available

f. Just-in-time training and Microlearning: Electronic training delivered to trainees when and where they need it.

 Microlearning: Training sessions that take place in 5 minutes or less

 MOOCs: Online training courses that anyone can take

g. Social Media: blogs, wikis, corporate socialmedia tools, and basic community pages on Linkedin and Facebook

h. Behavior modeling: a learning approach in which work behaviors are demonstrated and trainees mimic them. Four components:

 Learning points

 Modeling

 Practice

 Feedback and reinforcement

i. Role-Playing: Computer programs that simulate role-playing have also been developed.

j. Coaching: a continuing flow of instructions, comments, suggestions, encouragement, and support to help people do their jobs and become leaders

Instructor Manual: Snell/Morris, Managing Human Resources 19e, c23, ISBN: 9780357716519; Chapter #1: The Opportunities and Challenges of Human Resources Management

 All employees should receive coaching. k. Case Studies: documented examples to learn how to analyze and synthesize facts, become conscious of the variables in management decisions, and improve decision-making skills.

Figure

l. Seminars and Conferences: useful for group training

 used to communicate ideas, policies, or procedures, debate, or discuss issues.

m. Classroom (Lecture) Instruction: motivates students to attend and the instructor is available to help

n. Blended Learning: the use of in-person learning and online learning.

 It benefits students who learn in different ways and relieves tedium.

EOC (Optional) Discussion Question #4: 5 minutes total.

Discussion Activity 3

Suppose that you are the manager of an accounts receivable unit in a large company. You are switching to a new system of billing and record-keeping and need to train your three supervisors and 28 employees in the new procedures. What training method(s) would you use? Why?

CO 7.5: Describe some of the additional training programs conducted by firms, and why they are important.

7.5. Additional Training and Development Programs

Many employers develop training programs to meet the special needs of employees.

7.5A Orientation and Onboarding

l. Orientation: the formal process of familiarizing new employees with the organization, jobs, and work units.

 defines the philosophy behind the organization’s rules and provides a framework for job-related tasks.

 HR coordinates orientation activities.

ll. Onboarding: the process of socializing new employees.

 goes beyond orientation by bringing new employees into the organization’s fold

 Onboarding can include tours, an employee ―buddy,‖ and videos.

7.5B Basic Skills Training: Remedial, or basic skills, training for adults combats the skills gap between formal education and the skills needed to succeed in a job.

 includes reading, math, and communication skills.

7.5C. Team Training Figure

7.9

l. Organizations rely on teams to attain strategic and operational goals.

 Employees must be able to work as effective team members.

ll. Adventure-based learning: the use of adventures, such as games, trust activities, and problem-solving initiatives, for the personal and social development of participants.

7.5D. Cross-Training: process of training employees to do multiple jobs within an

organization

 It gives the organization and its employees flexibility.

7.5E. Ethics Training

 After high-profile corporate scandals, ethics training became popular. It is legally required for some businesses that have government contracts.

 A chief ethics officer is a high-ranking manager directly responsible for fostering the ethical climate within the firm.

7.5F. Diversity and Inclusion Training

l. Diversity training can be effective when it is voluntary and undertaken to increase awareness and advance a company’s business goals,

ll. Types of diversity training:

 Awareness building about the benefits of diversity

 Training to prevent discrimination, harassment, and lawsuits

 Skill building, which provides the KSAOs for working with people who are different

 Organizations focus on inclusion to creates a workplace where all are treated fairly and respectfully.

CO7.6: Explain how the effectiveness of training programs is evaluated.

7.6. Phase 4: Evaluating the Training Program Figure 7.10

l. Evaluating a training program helps managers improve it.

ll. The four major criteria are reaction, learning, behavior, and results.

7.6A. Criterion 1: Reactions

l. One of the simplest approaches is to assess participants’ reactions to it.

ll. Reaction measures should not stop with assessing the training’s entertainment value

7.6B. Criterion 2: Learning

l. Testing the knowledge and skills before and after a training program and comparing trained to untrained employees determine improvement.

7.6C. Criterion 3: Behavior

l. Transfer of training: the application of principles learned to job requirements.

ll. The transfer of training, managers and trainers can take several approaches

 Feature identical elements.

 Focus on general principles, if necessary. Establish a climate for transfer.

 Give employees transfer strategies.

7.6D. Criterion 4: Results, (Return on Investment)

l. Organizations measure training in terms of its return on investment (ROI), the

utility the firm gets for its training dollars.

ll. Benchmarking: the practice of comparing data and statistics from your operations against those of industry leaders

lll. As e-learning changes training, the benchmarks change as well.

EOC (Optional) Discussion Question #4: 5 minutes total.

Discussion Activity 4

Participants in a training course are often asked to evaluate the course by means of a questionnaire. What are the pros and cons of this approach? Are there better ways of evaluating a course?

Discussion Questions

1. Question: What economic, social, and political forces have made employee training even more

Suggested answer: Increased global and domestic competition, rapid advances in technology, mergers and acquisition, a focus on human-based competition, occupational obsolescence are increasing the need for continuous training.

2. Question: What analyses should be done to determine the training needs of an organization? After the needs are determined, what is the next step?

Suggested answer To determine the training needs of an organization, the analyses to be made are the organization analysis, the task analysis, and the person analysis. An organization analysis is an examination of an organization’s environment, goals, strategies, performance, and resources so as to determine what training it should do. A task analysis is the process of determining a training program’s content by studying the tasks and duties a job involves. A person analysis is the process of determining the specific individuals who need training in an organization.

3. Question: Which principles of learning do you see demonstrated in your own classes? In what ways might you bring other principles into them?

Suggested answer Students’ answers will vary. Principles such as goal setting, meaningfulness, feedback, and the like may all be demonstrated in the classroom. Other principles, such as modeling and practice, could be brought into the class through demonstrations and practical applications.

4. Question: Suppose that you are the manager of an accounts receivable unit in a large company. You are switching to a new system of billing and record-keeping and need to train your three supervisors and 28 employees in the new procedures. What training method(s) would you use? Why?

Suggested answer Students will have different opinions about the best methods to use. One recommendation is that supervisors and employees be trained by using lectures and programmed instruction. Exercises in the new procedures should accompany the lectures.

5. Question: Participants in a training course are often asked to evaluate the course by means of a questionnaire. What are the pros and cons of this approach? Are there better ways of evaluating a course?

Suggested answer: Questionnaires (reactions) often provide valuable suggestions that can be used to improve a training course. However, there is a tendency for participants to report favorably out of deference to the course leader or to management for providing the training opportunity. Evaluations should include a study of how the trainees’ knowledge, attitudes, and behaviors were changed vis-à-vis a matched control group that did not participate in the course.

Additional Discussion Questions

The following are discussion questions that do not appear in the text, PPTs, or courseware (if courseware exists) – they are for you to use as you wish. You can assign these questions several ways: in a discussion forum in your LMS; as whole-class discussions in person; or as a partner or group activity in class.

6. Question: How has the Covid-19 pandemic as well as economic and public policy concerns affected training programs?

Suggested answer: The Covid-19 pandemic placed many organizations in crisis mode, as they had to rapidly train employees on methods of remote working. Economic and public policy issues influence corporate training needs as well. For example, cyber security concerns, the shift to sustainable energy, diversity and inclusion, and the like are all public policy issues that influence the training needed in organizations.

Additional Activity

The following are activities and assignments developed by Cengage but not included in the text, PPTs, or courseware (if courseware exists) – they are for you to use if you wish. Research and Evaluate McDonald’s training program: McDonald's has an extensive ongoing training system that includes Hamburger University, which offers comprehensive management courses taught in 28 different languages. McDonald's Supply Chain department has developed an extensive network of the world's finest suppliers.

What are the strengths and weaknesses of McDonald‘s training programs? Would you like to work at McDonald‘s? Discuss your findings in small groups in -person or over Zoom

Case Study 1 Whirlpool Mixes Up Its Managerial Training: Closed-Looped Method Brings Learning Full Circle

1. Question: Why are a needs assessment and ongoing training important for firms like Whirlpool to conduct?

Suggested answer: It is important for firms like Whirlpool to conduct needs assessment and ongoing training programs, especially in times of economic downturn, to motivate the workforce. Training sessions with feedback sessions would help managers derive better results from their teams at a time when employee morale is low.

2. Question: How do you think Whirlpool‘s training strategy will need to change in the future?

Suggested answer: Yes, focusing on training managers and supervisors prior to training rank-and-file employees is a good strategy for Whirlpool because managers and supervisors can mentor other employees and set a benchmark for other employees to achieve.

Case Study 2: Loews Hotels: Training for Four-Diamond Service and More

1. Question: How do the training programs at Loews relate to the company‘s business strategy?

Suggested answer: Loews wishes to differentiate itself from other high-end hotels through its employees’ attitudes, service, and interaction with customers. The company’s system of having trainers work alongside the staff and not just in the classroom plus other training and educational opportunities enables it to achieve that objective.

2. Question: Why does the company encourage its employees to focus on the customers‘ needs versus other metrics?

Suggested answer: The customers that Loews seeks to serve have demanding expectations. Success depends upon meeting and exceeding those expectations and doing so better than the competition. The employees are key to that objective; thus, the training seeks to enable employees to focus on customer needs.

Additional Resources

Cengage Video Resources



MindTap Videos:

o Chapter 07: On The Job: Ocean House- Training and Development

Chapter 08: Performance Management Instructor Manual

Instructor Manual: Snell/Morris, Managing Human Resources 19e, c23, ISBN: 9780357716519; Chapter #1: The Opportunities and Challenges of Human Resources Management

Snell/Morris, Managing Human Resources 19e, c23, ISBN 9780357716519; Chapter #8: Performance Management

Table of Contents

Purpose and Perspective of the Chapter 109

Chapter Objectives 109

Key Terms 109

What's New in This Chapter 110

Chapter Outline 111

Discussion Questions 117

Additional Discussion Questions 118

Additional Activities and Assignments 119

Case Study 1: Adobe Ditches Formal Performance Reviews And Wants to Help Other Companies Do So Too………………………………………………………………………………………………………..13

Case Study 2: ―Project Oxygen‖ Resuscitates Google’s Poor-Performing Bosses………………..14

Additional Resources 120

Cengage Video Resources 120

Purpose and Perspective of the Chapter

How do you know if your efforts are really paying off in terms of what the employees are contributing once they are on the job? Performance management is the process of creating a work environment in which people can perform to the best of their abilities in order to meet a company‘s goals. It is an entire work system that flows from a company‘s goals

Performance reviews and feedback sessions, which are used for administrative and development purposes, are the result of a process in which a manager meets with and evaluates an employee‘s performance relative to the requirements of their job and uses the information to show the person where improvements could be made and why. The reviews are just part of the performance management process, however. Aligning the goals of employees with that of the firm, providing employees with continual on-the-job feedback, and rewarding them are critical as well.

Information about how well employees are performing can be derived from a variety of sources, including the employee, their supervisor, peers, customers, suppliers, and subordinates. Several methods can be used to gauge the performance of employees. Although there are various approaches to review meetings, research suggests that employee participation and goal setting lead to higher satisfaction and improved performance.

Chapter Objectives

The following objectives are addressed in this chapter:

1. Explain what performance management is and how the establishment of goals, ongoing performance feedback, and the evaluation process are part of it.

2. Describe the different sources of performance-management information, as well as the strengths or limitations of each

3. Explain the various methods used to evaluate the performance of employees, and their potential tradeoffs

4. Outline the characteristics of effective performance review meetings and feedback sessions and ways to improve the performance of employees

Key Terms

Behaviorally anchored rating scale (BARS): A behavioral approach to performance rating that consists of a series of vertical scales, one for each important dimension of job performance

Behavior observation scale (BOS): A behavioral approach to performance rating that measures the frequency of observed behavior

Calibration: A process whereby managers meet to discuss the performance of individual employees to ensure their employee reviews are in line with one another

Contrast error: A performance rating error in which an employee‘s review is biased either upward or downward because of comparison with another employee just previously evaluated

Customer evaluation: A performance evaluation that includes evaluations from both a firm‘s external and internal customers

Error of central tendency: A performance rating error in which all employees are rated about average

Essay method: A trait approach to performance rating that requires the rater to write a statement describing an employee‘s behavior

Forced-choice method: A trait approach to performance rating that requires the rater to choose from statements designed to distinguish between successful and unsuccessful performance

Forced distribution: A performance ranking system whereby raters are required to place a certain percentage of employees into various performance categories

Graphic rating scale method: A trait approach to performance rating whereby each employee is rated according to a scale of characteristics

Leniency or strictness error: A performance rating error in which the appraiser tends to give employees either unusually high or unusually low ratings

Manager and/or supervisor evaluation: A performance evaluation done by an employee‘s manager and often reviewed by a manager one level higher

Management by objectives (MBO): A philosophy of management that rates the performance of employees based on their achievement of goals set mutually by them

Mixed-standard scale method: A trait approach to performance rating similar to other scale methods but based on a comparison with (better than, equal to, or worse than) a standard

Peer evaluation: A performance evaluation done by one‘s fellow employees, generally on forms compiled into a single profile for use in the evaluation meeting conducted by the employee‘s manager

Performance management: The process of creating a work environment in which people can perform to the best of their abilities

Performance reviews: A process in which a manager evaluates an employee‘s performance relative to the requirements of his or her job and uses the information to show the person where improvements can be made and how

Recency error: A performance rating error in which the evaluation is based largely on the employee‘s most recent behavior rather than on behavior throughout the evaluation period

Self-evaluation: A performance evaluation done by the employee being evaluated, generally on an evaluation form completed by the employee prior to the evaluation meeting

Similar-to-me error: A performance rating error in which an appraiser inflates the review of an employee because of a mutual personal connection

SMART goals: Goals that are specific, measurable, achievable, realistic, and time-based

Subordinate evaluation: A performance evaluation of a superior by an employee, which is often used for developmental rather than for administrative purposes

Team evaluation: A performance evaluation that recognizes team accomplishments rather than individual performance

360-degree evaluation: A performance evaluation done by different people who interact with the employee, generally on forms compiled into a single document for use in the evaluation meeting conducted by the employee‘s manager

What's New in This Chapter

The following elements are improvements in this chapter from the previous edition: Chapter # New component(s)

Chapter 8 ● Additional tips for minimizing criticism when conducting performance evaluations. Chapter 8 ● Clarifications about information systems and databases.

Chapter 8 ● Edits to improve information flow including one-word depictions of performance

review guidelines.

Chapter Outline

The following outline organizes activities (including any existing discussion questions in PowerPoints or other supplements) and assessments by chapter (and therefore by topic), so that you can see how all the content relates to the topics covered in the text.

CO 8.1: Explain what performance management is and how the establishment of goals, ongoing performance feedback, and the evaluation process are part of it.

8.1. Performance Management Systems

Figure 8.1

l. Performance management: the process of creating a work environment in which people can perform to the best of their abilities.

ll. Performance reviews: a manager evaluates an employee’s performance relative to the requirements of the job and shows where improvements can be made and how.

lll. Reviews are annual, biannual, or quarterly, but frequent short reviews are better.

(Optional) Knowledge Check: <5 minutes total

Use Figure 8.1 to discuss how the performance review fits into the performance management process.

8.1A. The Purposes of Performance Management

l. Performance management systems influence employee behavior and improve performance.

ll. The purposes of performance management programs are administrative and developmental (Optional) Knowledge Check: <5 minutes total

Figure 8.2

Use Figure 8.2 to discuss the developmental and administrative purposes of performance management.

a. Developmental Purposes: The goal is employee development

 The manager is a coach rather than a judge.

b. Administrative Purposes: input for HRM activities

 The success depends on knowing how the performance compares with goals

8.1B. Why Performance Management Systems Sometimes Fail

l. Many organizations now use continuous feedback and coaching. EOC (Optional) Discussion Question #1: 5 minutes total.

Discussion Activity 1

Figure 8.3

Describe how the performance management process is linked to employee selection, training, and development.

CO 8.2: Describe the different sources of performance-management information, as well as the strengths or limitations of each

8.2. Developing an Effective Performance Management System

l. The HR department oversees and coordinates a performance management system.

ll. Managers from operating departments must be actively involved.

lll. Employees are more satisfied with a performance management system when they participate in its development.

8.2A. What Are the Performance Standards?

Figure 8.4

l. based on requirements derived from a job analysis and reflected in job description and job specifications.

ll. SMART goals: specific, measurable, achievable, realistic, and time-based.

(Optional) Knowledge Check: <5 minutes total

Use Figure 8.4 to discuss the four basic elements that must be considered when establishing performance standards: strategic relevance, criterion deficiency

a. Strategic Relevance: the extent to which the performance standards relate to the strategic objectives in which they are applied.

b. Criterion Deficiency: performance standards should capture all employee performance.

c. Criterion Contamination: factors outside employee control that influence performance.

d. Reliability: consistency of a standard or maintain a level of performance over time.

 measured by correlating two sets of ratings by a single rater or by two different raters.

 Calibration: managers discuss the performance of employees to ensure their reviews are in line with one another.

e. Fairness and Acceptability: employee concerns about fairness

 Acceptability relates to how hard or how difficult it is to administer the performance management system

8.2B. Do Your Performance Reviews Comply with the Law?

l. Performance reviews must meet certain legal requirements.

Figure 8.5

ll. Some court decisions indicate that employers might face legal challenges when evaluations indicate an employee’s performance is acceptable or above average but the person is later passed over for promotion, disciplined for poor performance, discharged, or laid off from the organization.

lll. Performance reviews should meet the following legal guidelines:

 Relevance. Performance ratings must be job-related with performance standards

 No surprises. Employees must be provided with clear, written job standards in advance of their reviews so they understand what they need to do to get top ratings.

 Avoid Subjectivity. Managers who conduct the reviews must observe the behavior they rate Timeliness. Do not allow performance problems to continue unchecked.

Instructor Manual: Snell/Morris, Managing Human Resources 19e, c23, ISBN: 9780357716519; Chapter #1: The Opportunities and Challenges of

 Avoid bias in the process and the outcomes. HR should review the reviews to see if minority groups are adversely impacted.

 Transparency. Reviews should be discussed openly with employees, and counseling or corrective guidance offered to help poor performers improve performance.

 Fairness. An appeals procedure should be established to enable employees to express their disagreement with the evaluations.

lV. HR professionals should also review the supervisors’ review comments.

8.2C. Sources of Performance Review Information: employees can be rated by many people. Figure

8.5

l. Manager and/or supervisor evaluation: a performance evaluation by manager and reviewed by a manager one level higher.

ll. The Employee

a. Self-evaluation: a performance evaluation done by the employee being evaluated, on an evaluation form completed by the employee prior to the evaluation meeting.

b. Subordinate evaluation: a performance evaluation of a superior by an employee, used for developmental rather than administrative purposes

c. Peer evaluation: a performance evaluation done by fellow employees on forms compiled into a single profile for use in a meeting conducted by the manager.

d. Team evaluation: a performance evaluation that recognizes team accomplishments

e. Customer evaluation: a performance evaluation that includes evaluations from external and internal customers.

8.2D. Putting It All Together: 360-Degree Evaluations

l. A 360-degree evaluation: a performance evaluation by different people who interact with the employee, on forms compiled into a single document for use in the meeting conducted by the manager.

8.2E. Training Appraisers: improve performance review

l. Supervisors should be evaluated on evaluating and developing subordinates.

a. Establishing a Review Plan

Figure 8.6

 A training program is effective when it explains the objectives of the performance management system and its philosophy on evaluations.

b. Eliminating Rating Errors Several types of errors occur.

 Distributional errors occur when a single rating is skewed toward an entire group of employees.

 Error of central tendency: all employees are rated about average.

 Leniency or strictness error: the appraiser give employees unusually high or unusually low ratings.





Forced distribution: raters place a percentage of employees into various categories. All employees are rated about average.

Temporal errors: a review is biased because of the way performance information is selected, evaluated, and organized over time.

 Recency error: the evaluation is based on recent behavior rather than on behavior throughout the evaluation period.

 Contrast error: an employee’s review is biased upward or downward because of comparison with another employee

 Similar-to-me error: an appraiser inflates the employee review because of a personal connection.

 Holding ―mock‖ calibration meetings gives participants the opportunity to:

o observe other managers making errors

o actively participate in discovering their own errors

o practice job-related tasks to reduce the errors.

c. Feedback Training: A training program for raters should teach managers how to provide feedback and should include:

 communicating effectively to gain the employee’s support

 diagnosing the root causes of performance problems

 setting goals and objectives for the employee to achieve in conjunction with the feedback

EOC (Optional) Discussion Question #2: 5 minutes total.

Discussion Activity 1

What sources could be used to evaluate the performance of people working in the following jobs?

a. Sales representative

b. Robotics engineer

c. Director of nursing in a hospital

d. HR manager

e. Air traffic controller

CO 8.3. Explain the various methods used to evaluate the performance of employees, and their potential tradeoffs.

8.3. Performance Review Methods: measuring traits, behaviors, or results.

8.3A. Trait Methods: measure the extent to which an employee possesses certain characteristics considered important for the job and the organization

 Graphic rating scale method: each employee is rated according to a scale of characteristics.

 Mixed-standard scale method: based on a comparison with (better than, equal to, or worse than) a standard.

Instructor Manual: Snell/Morris, Managing Human Resources 19e, c23, ISBN: 9780357716519; Chapter #1: The Opportunities and Challenges of Human Resources Management

 Forced-choice method: the rater chooses from statements designed to distinguish between successful and unsuccessful performance.

 Essay method: the rater writes a statement describing an employee’s behavior.

8.3B. Behavioral Methods: describe which actions should be exhibited on the job.

 Critical Incident Method: helps a manager counsel employees with performance problems and increases the objectivity of the review

 Behavioral Checklist Method: the rater checks statements on a list that describe characteristics of the employee’s behavior.

 Behaviorally anchored rating scale (BARS): a behavioral approach g that includes vertical scales, one for each important dimension of job performance.

 Behavior observation scale (BOS): measures the frequency of observed behavior.

8.3C. Results Methods: Many organizations evaluate employees’ accomplishments.

l. Sales, Productivity, and Quality Measures

 Results are used to evaluate performance

 Revenue, units produced, and quality are examples.

 The methods or processes used to achieve the results should be considered.

ll. Management by objectives (MBO): rates the performance of employees based on their achievement of goals set mutually by them and their managers. Figure 8.7 (Optional) Knowledge Check: <5 minutes total

Use Figure 8.7 to discuss an MBO system. Step through the process

lll. The Balanced Scorecard (BSC): used to appraise individual employees, teams, business units, and the corporation itself.

lV. A BSC evaluation takes into account:

 Financial measures

 Customer measures

 Process measures

 Learning measures

8.3D Which Performance Review Method Should You Use?

Figure 8.8 (Optional) Knowledge Check: <5 minutes total

Use Figure 8.8 to discuss the major strengths and weaknesses of trait, behavior, and results approaches to appraising employees.

CO 8.4: Outline the characteristics of effective performance review meetings and feedback sessions and ways to improve the performance of employees

8.4. Performance Review Meetings and Feedback Sessions

l. Schedule review meetings 10-14 days before the meeting.

ll. Divide the meeting into two sessions, one for the performance review and the other for the employee’s growth plans,

8.4A. Types of Performance Review Meetings and Feedback Sessions. Formats:





Tell-and-Sell: Persuade an employee to change behavior in a certain way.

Tell-and-Listen: The appraiser communicates the strong and weak points of job performance, and the employee’s feelings about the evaluation are explored.

 Problem-Solving: This proactive format seeks to obtain the employees’ buy-in for a mutually agreed-upon way to overcome obstacles and improve performance. EOC (Optional) Discussion Question #3: 5 minutes total.

Discussion Activity 3

Three types of review meetings are described in this chapter. What different skills are required for each? What reactions can one expect from using these different skills? How can a manager develop the skills needed to conduct a problem-solving type of meeting? Which method do you feel is the least desirable? Why?

8.4B. Conducting the Performance Review Meeting or Feedback Session

l. Guidelines for the feedback process:

 Ask for a Self-Evaluation: Employees should evaluate their performance prior to the meeting

 Invite Participation: Communication should be a two-way street

 Express Appreciation: Show appreciation for what the employee does well.

 Be Supportive and Demonstrate That You Care: The manager will eliminate roadblocks and work with the employee to achieve better performance.

 Minimize Criticism: Criticism should be constructive.

o Consider whether it’s necessary

o Consider the person’s ability to handle it

o Be specific and don’t exaggerate

o Watch your timing

o Make improvement your goal

 Establish Goals: Focus on the future

o Emphasize strengths.

o Drop unproductive tasks.

o Limit improvement plans.

o Highlight how both the employee and firm will excel if the goals are achieved.

 Follow Up Day to Day: employees can benefit from ongoing performance conversations with managers

8.4C. Improving Performance: performance management systems tell who is not performing well but do not reveal why. Figure 8.9

l. Identifying the Sources of Ineffective Performance Figure 8.10

 A person’s performance results from three concerns: ability, motivation, and environment.

(Optional) Knowledge Check: <5 minutes total

Use Figure 8.10 to discuss causes of an employee’s poor performance

 Performance Diagnosis: If someone is not achieving the desired results, it may be due to factors beyond control.

 Managing Ineffective Performance: Once the sources of problems are known, a course of action can be planned.

 Focus on Changing the Behavior, Not the Person: Avoid suggestions about personal traits employees should change.

 Suggest more acceptable ways of performing.

 If ineffective performance persists, it may be necessary to transfer the employee, take disciplinary action, or discharge the person

EOC (Optional) Discussion Question #4: 5 minutes total.

Discussion Activity 4

Discuss how you would go about diagnosing an employee’s performance problems. List several factors to consider.

Discussion Questions

1. Question: Describe how the performance management process is linked to employee selection, training, and development.

Suggested answer: Performance management is the process of creating a work environment in which people can perform to the best of their abilities in order to meet a company’s goals. This process is linked with other HR functions like employee selection, training, and development. A poor performance review can limit promotional or transfer opportunities. A poor evaluation may necessitate additional training to bring the employee up to acceptable performance standards. Depending on the evaluation received, increases in salary may or may not be recommended.

2. Question: What sources could be used to evaluate the performance of people working in the following jobs?

a. Sales representative

b. Robotics engineer

c. Director of nursing in a hospital

d. HR manager

e. Air traffic controller

Suggested answer: A variety of sources could be used to evaluate the performance of people working in the following jobs.

a. Sales representative: Manager/Supervisor, the Employee, Peers, Customers

b. Robotics engineer: Manager/Supervisor, the Employee, Peers, Team members

c. Director of nursing in a hospital: Manager/Supervisor, the Employee, Subordinates, Peers

d. HR manager: Manager/Supervisor, the Employee, Subordinates, Peers

e. Air traffic controller: Manager/Supervisor, the Employee, Peers

3. Question: Three types of review meetings are described in this chapter.

a. What different skills are required for each? What reactions can one expect from using these different skills?

b. How can a manager develop the skills needed to conduct a problem-solving type of meeting?

c. Which method do you feel is the least desirable? Why?

Suggested answer:

a. The tell-and-sell method requires the ability to persuade an employee to change his or her behavior in a certain way. The tell-and-listen method requires the ability to communicate the strong and weak points of an employee’s performance and to explore the employee’s feelings about the review. The problem-solving method requires the ability to listen, accept, and respond to feelings and to obtain the employee’s buy-in.

b. The problem-solving format is the most proactive. Training and practice in listening, accepting, and responding to feelings are essential.

c. Probably most students will agree that the tell-and-sell method is the least desirable because the employee has the least opportunity to communicate.

4. Question: Discuss how you would go about diagnosing an employee‘s performance problems. List several factors to consider.

Suggested answer: A person’s performance is a function of several factors, but perhaps it can be boiled down to three primary concerns: ability, motivation, and environment. Figure 8.9 in the chapter provides a better picture of how these three factors can influence people’s performance. Problems in any one of these areas could cause the person’s performance to suffer.

Additional Discussion Questions

The following are discussion questions that do not appear in the text, PPTs, or courseware (if courseware exists) – they are for you to use as you wish. You can assign these questions several ways: in a discussion forum in your LMS; as whole-class discussions in person; or as a partner or group activity in class.

EOC (Optional) Additional Discussion Question #1: 5 minutes total.

5. Question: Describe the balanced scorecard (BSC).

Suggested answer: The balanced scorecard (BSC), which was first discussed in Chapter 2, can be used to appraise individual employees, teams, business units, and the corporation itself. A BSC review takes into account four related categories: (1) financial measures, (2) customer measures, (3) process measures, and (4) learning measures. Highlights in HRM 5 shows how a balanced scorecard in the financial category translates to a personal scorecard for an employee. The corporation‘s financial objectives have already been spelled out on the top of the scorecard. Then the various business unit targets are added, followed by the target objectives of the firm‘s teams and individual employees. The scorecard helps an employee see clearly how his or her performance ties in to the overall performance of the firm.

Additional Activity

The following are activities and assignments developed by Cengage but not included in the text, PPTs, or courseware (if courseware exists) – they are for you to use if you wish.

Internet Activity: Using online resources, research the pros and cons of using a Management By Objectives performance evaluation system. Report your findings to the class.

Case Study 1: Adobe Ditches Formal Performance Reviews— And Wants to Help Other Companies Do So Too

1. Question: Why did Adobe need a new performance management system? What drawbacks might there be to the company‘s check-ins?

Suggested answer: Problems with the traditional system of reviews included the following: (1) Workers didn’t feel the reviews were helpful. (2) Workers prefer feedback in the moment. (3) Reviews were stressful. (4) Many workers looked for a new job after a review. (5) Two-thirds of millennials preferred jobs without reviews.

Students’ answer about problems with check-ins will vary. The long-term effect is not known. For example, career planning within a company might be affected.

2. Question: Are formal performance reviews always bad? Why or why not?

Suggested answer: Students’ answer will vary. Formal performance reviews are not always bad. They document a worker’s ability and progress over a long period of time.

Case Study 2: “Project Oxygen” Resuscitates Google’s PoorPerforming Bosses

1. Question: Why isn‘t having the greatest amount of technical expertise the key to being a good supervisor at Google?

Suggested answer: Project Oxygen concluded that having the greatest amount of technical expertise was not the key to being a good supervisor in Google. Employees were happier and stayed with the company longer when the managers were even-

Instructor Manual: Snell/Morris, Managing Human Resources 19e, c23, ISBN: 9780357716519; Chapter #1: The Opportunities and Challenges of Human Resources Management

tempered, helped their teams think through problems without micromanaging them, and cared about them as people.

2. Question: Does Google‘s research on the performance of its managers surprise you? Why or why not?

Suggested answer: Students’ answer will vary. Some students might think that Google’s research did not surprise them considering their high turnover rate despite providing many job perks. It was also said that the primary reason for people leaving their jobs was their boss. Google’s researchers wanted to find out what works for them compared to other organizations.

Additional Resources

Cengage Video Resources

MindTap Videos:

o Chapter 08: Concept Clip: Performance Evaluations/Appraisals

o Chapter 08: On The Job: Metropolitan Bakery- Performance Management

Chapter 09: Managing Compensation Instructor Manual

Snell/Morris, Managing Human Resources 19e, c23, ISBN: 9780357716519; Chapter #9: Managing Compensation

Instructor Manual: Snell/Morris, Managing Human Resources 19e, c23, ISBN: 9780357716519; Chapter #1: The Opportunities and Challenges of Human Resources Management

Purpose and Perspective of the Chapter

Compensation is a way to increase employee loyalty and to decrease the likelihood that employees will be hired away by competitors. It reflects a strategic move on the part of the company to show that its employees are the most important component for success. So why focus on compensation to retain talent? Why not hire employees who will be more loyal? Why not improve the training programs or evaluation systems? The answer is simple: Compensation is directly linked to an employee‘s livelihood. Employees can receive stellar training, copious growth opportunities, and be completely satisfied with their work and environment, but they will not show up to work if there is no paycheck in return.

Compensation consists of (1) direct compensation that includes wages, salary bonuses and commissions; (2) indirect compensation that includes benefits like healthcare and vacation days; (3) nonfinancial compensation that includes recognition programs, rewards, support, flexibility and the work environment. Combined, these three forms of compensation represent a major cost to the company. If managed strategically, these costs can also represent investments. Establishing strategic compensation programs requires an assessment of organizational objectives in relation to specific employment goals employee retention for continued growth, compensation distribution to ensure employees feel treated fairly, communication of compensation methods to increase employee understanding of organizational objectives, and adherence to a budget for cost efficiencies.

Chapter Objectives

The following objectives are addressed in this chapter:

1. Explain the three main components of a person‘s compensation.

2. Distinguish between a strategic compensation program and a non-strategic compensation program.

3. Determine how to design pay systems.

4. Evaluate which jobs should be paid more.

5. Estimate whether a pay system is consistent within an industry.

6. Estimate whether a pay system is aligned with government laws.

7. Design a compensation scorecard.

Key Terms

Broadbanding: Collapses many traditional salary grades into a few wide salary bands

Compensation scorecard: Displays the results for all the measures that a Company uses to monitor and compare compensation among internal departments or units

Competence-based pay: Pay based on an employee‘s skill level, variety of skills possessed, or increased job knowledge

Consumer price index (CPI): A measure of the average change in prices over time in a fixed ―market basket‖ of goods and services

Escalator clauses: Clauses in labor agreements that provide for quarterly cost-of-living adjustments in wages, basing the adjustments on changes in the consumer price index

Exempt employees: Employees not covered by the overtime provisions of the Fair Labor Standards Act

Hay profile method: A job evaluation technique using three factors knowledge, mental activity, and accountability to evaluate executive and managerial positions

Hourly work: Work paid on an hourly basis

job classification system: A system of job evaluation in which jobs are classified and grouped according to a series of predetermined wage grades

Job evaluation: A systematic process of determining the relative worth of jobs to establish which jobs should be paid more than others within an organization price index, that is, the real earning power of wages

job ranking system: The simplest and oldest system of job evaluation by which jobs are arrayed on the basis of their relative worth

Nonexempt employees: Employees covered by the overtime provisions of the Fair Labor Standards Act

Pay equity: An employee‘s perception that compensation received is equal to the value of the work performed

Pay-for-performance Standard: A standard by which managers tie compensation to employee effort and performance

Pay grades: Groups of jobs within a particular class that are paid the same rate

Pay rate compression: Compression of pay between new and experienced employees caused by the higher starting salaries of new employees; also the differential between hourly workers and their managers

Piecework: Work paid according to the number of units produced

Point system: A quantitative job evaluation procedure that determines the relative value of a job by the total points assigned to it

Real wages: Wage increases larger than rises in the consumer

Red circle rates: Payment rates above the maximum of the pay range

Wage and salary survey: A survey of the wages paid to employees of other employers in the surveying organization‘s relevant labor market

Wage curve: A curve in a scattergram representing the relationship between relative worth of jobs and pay rate

Work valuation: A job evaluation system that seeks to measure a job‘s worth through its value to the organization

What's New in This Chapter

The following elements are improvements in this chapter from the previous edition:

Chapter # New component(s)

Chapter 9 ● New coverage of systems and websites, such as Glassdoor and Buffer, to collect salary and other related data used especially in job evaluation.

Chapter 9 ● A list of the highest paying jobs for 2019 in the United States

Chapter 9 ● An updated discussion of the minimum age requirement for employment.

Chapter 9 ● Updated salary rates for the fastest growing jobs in the United States.

Chapter Outline

The following outline organizes activities (including any existing discussion questions in PowerPoints or other supplements) and assessments by chapter (and therefore by topic), so that you can see how all the content relates to the topics covered in the text

CO 9.1: Explain the three main components of a person’s compensation.

9.1 What Is Compensation?

l. Compensation has three components

 Direct compensation: employee wages and salaries, incentives, bonuses, and commissions

 Indirect compensation: benefits supplied by employers

 Nonfinancial compensation: employee recognition programs, rewarding jobs, organizational support, work environment, and flexible work hours (Optional) Knowledge Check: <5 minutes total

Figure 9.1

Use Figure 9.1 to discuss the different types of compensation. Ask students to give examples of indirect and nonfinancial compensation.

ll. Organizations tell their employees what is important based on how they align the components of compensation. Figure 9.2

CO 9.2: Distinguish between a strategic compensation program and a non-strategic compensation program.

9.2. Strategic Compensation

l. Compensation of employees to enhance motivation and growth while aligning their efforts with the organization’s objectives.

ll. A tool to secure a competitive advantage.

lll. To develop a compensation strategy, analyze the mission and objectives.

lV. Meshes monetary payments with HR initiatives: recruitment, selection, training, retention, and performance appraisal.

9.2A. Linking Compensation to Organizational Objectives

l. Managers must be more strategic about compensation decisions.

ll. They must understand strategic objectives in relation to the industry.

lll. Managers need to move from paying for a job title to rewarding employees based on work contributions to organizational objectives.

lV. They need to consider what kinds of compensation create value.

V. Objectives and Key Results (OKR) system: ties compensation to objectives.

 Set up an objective for the team and individuals on the team.

 Set up quantifiable key results that your team and each member must complete by a specific time.

Vl. A successful OKR system requires an annual checkup with quarterly check-ins at the

team level, manager level, and team member level. Guidelines:

 Clarify expectations.

 Balance aspirational with operational.

 Consider additional performance factors.

 Drive collaboration, not competition.

9.2B. The Pay-for-Performance Standard: a standard by which managers tie compensation to employee effort and performance

l. Pay-for-performance: refers to compensation options, including merit-based pay, bonuses, salary commissions, job and pay banding, team/group incentives, and gainsharing programs.

a. Motivating Employees through Compensation.

 Pay should be equitable in terms of an employee’s contributions and what other employees receive for their contributions.

b. Pay Equity: an employee’s perception that compensation received is equal to the value of the work performed Kinds of pay equity:

 External equity: comparing compensation to similar positions in different organizations

 Internal equity: comparing compensation to peers in different jobs in the same organization

 Individual equity: comparing compensation to others with the same job in the same organization

Figure 9.3

c Expectancy Theory and Pay predicts that the level of motivation depends on the attractiveness of the rewards and the probability of obtaining them.

 An employee must believe that effort will improve performance, and high performance will create better rewards.

(Optional) Knowledge Check: <5 minutes total Use Figure 9.3 to discuss how pay-for-performance and expectancy theory are related. Ask students what will happen over time if an employee performs well but is not well rewarded

d. Pay Secrecy: can generate distrust in the compensation system, reduce motivation, and inhibit effectiveness

 Companies maintain secrecy to reduce conflict le about pay inequalities

 Pay secrecy is difficult to maintain because salary survey data are available

9.2C. The Bases for Compensation Figure 9.4

l. Work performed in most private, public, and not-for-profit organizations is hourly work.

 Hourly work: paid on an hourly basis.

 Piecework: paid according to the number of units produced.

Instructor Manual: Snell/Morris, Managing Human Resources 19e, c23, ISBN: 9780357716519; Chapter #1: The Opportunities and Challenges of Human Resources Management

 Nonexempt employees: covered by the overtime provisions of the Fair Labor Standards Act.

 Exempt employees: not covered by the overtime provisions of the Fair Labor Standards Act.

EOC (Optional) Discussion Question #1: 5 minutes total.

Discussion Activity 1 Tomax Corporation has 400 employees and wishes to develop a compensation policy to correspond to its dynamic business strategy. The company wishes to employ a high-quality workforce capable of responding to a competitive business environment. Suggest different compensation objectives to match Tomax’s business goals.

CO 9.3: Determine how to design pay systems.

9.3. Compensation Design The Pay Mix Figure

Pay is determined by a combination of internal and external factors.

9.3A. Internal Factors:

 The organization’s compensation strategy

 The worth of a job

 An employee’s relative worth in meeting job requirements

 An employer’s ability to pay

a. Compensation Strategy: pay policies should reflect:

 The internal wage relationship among jobs and skill levels

 The external competition

 A policy of rewarding employee performance

 Administrative decision concerning element of the pay system

b. Worth of a Job

 Organizations without a formal compensation program base the worth of jobs on subjective opinions of people familiar with the jobs.

 Organizations with formal compensation programs rely on a system of job evaluation.

 Compensation professionals believe that a job’s value should be based on the total value delivered to the organization.

c. Employee’s Relative Worth

 Employee performance can be recognized and rewarded through promotions and incentive systems.

 Merit raises should be determined by a performance appraisal system that only gives deserving employees merit raises.

d. Employer’s Ability to Pay

 Pay levels are limited by earned profits and other financial resources available to employers.

 Ability to pay is determined by employee productivity

9.5

 Increases in capital investment reduce the number of employees needed and increase the ability to provide higher pay

9.3B. External Factors that influence pay rates:

 labor market conditions

 area pay rates

 cost of living

 collective bargaining

a. Labor Market Conditions: the forces of supply and demand for qualified labor in an area.

b. Area Pay Rates: rates must be comparable to those paid by other employers for comparable jobs in the area

 Wage surveys provide external pay equity.

c. Cost of Living

 Because of inflation, compensation rates must be adjusted upward periodically maintain purchasing power.

 Consumer price index (CPI): a measure of the average change in prices over time in a fixed ―market basket‖ of goods and services.

 Escalator clauses: clauses in labor agreements that provide for quarterly cost-of-living adjustments in wages, basing the adjustments on changes in the consumer price index.

d. Collective Bargaining: Labor unions bargain over compensation.

 Real wages: wage increases larger than rises in the consumer price index, the real earning power of wages.

EOC (Optional) Discussion Question #2: 5 minutes total.

Discussion Activity 2

Since employees may differ in terms of their job performance, would it not be more feasible to determine the wage rate for each employee on the basis of his or her relative worth to the organization? Explain

CO 9.4: Evaluate which jobs should be paid more

9.4. Job Evaluation Systems

l. Organizations determine the value of jobs through job evaluation.

ll. Job evaluation: determining the worth of jobs to establish which jobs should be paid more than others.

lll. Three methods of comparison:

 Rank the value of jobs from highest to lowest.

 Classify jobs to be benchmarked internally and externally.

 Award points to each job based on organizational objectives.

9.4A. Job Ranking System: jobs are arrayed on the basis of their relative worth.

Instructor Manual: Snell/Morris, Managing Human Resources 19e, c23, ISBN: 9780357716519; Chapter #1: The Opportunities and Challenges of Human Resources Management

9.4B. Job Classification System: jobs are classified and grouped according to wage grades

9.4C. Point System: a quantitative procedure that determines the value of a job by the points assigned

l. Points are assigned for the elements called compensable factors that constitute the job.

a. The Point Manual: a handbook that describes the compensable factors

b. Using the Point Manual

 To assign points, compare job descriptions and specifications to those in the manual.

 The total point value for the job is calculated.

9.4D. Work Valuation: a job evaluation system that measures a job’s worth through its value to the organization

9.4E. Job Evaluation for Management Positions: point plans for executive and managerial employees operate like those for other employees

l. The Hay profile method: a technique using knowledge, mental activity, and accountability to evaluate executive positions.

CO 9.5: Estimate whether a pay system is consistent within an industry.

9.5. Compensation Implementation Pay Tools must be incorporated

Figure 9.6

9.5A. Wage and Salary Surveys: show the wages paid by other employers in the relevant labor market, the area from which employers obtain workers

l. Wage and salary survey permit an organization to maintain external equity.

a. Collecting Survey Data: Many organizations conduct wage and salary surveys.

 Others are available for most types of employers.

 The Bureau of Labor Statistics (BLS) is the major publisher of wage and salary data.

b. Salary Surveys: found on numerous websites. Glassdoor provides free salary data.

9.5B. The Wage Curve: a curve in a scattergram representing the relationship between the relative worth of jobs and pay rates Figure 9.7 (Optional) Knowledge Check: <5 minutes total Use Figure 9.7 to discuss the wage curve

9.5C. Pay Grades: groups of jobs within a particular class paid the same rate Figure 9.8

9.5D. Rate Ranges: common to provide a range of rates for each pay grade Figure 9.9

l. Most salary structures allow the ranges of adjoining pay grades to overlap.

ll. The final step is determining the appropriate pay grade for each job is based on its evaluated worth.

lll. Red circle rates are payment rates above the maximum of the pay range.

9.5E. Competence-Based Pay: pay based on an employee’s skill level, variety of skills possessed, or increased job knowledge

l. These pay plans encourage employees to earn higher wages by learning and performing more skills or displaying competencies.

ll. It represents a change in how work is organized and how employees are paid.

a. Broadbanding collapses many traditional salary grades into a few wide salary bands

 It encourages lateral skill building

CO 9.6: Estimate whether a pay system is aligned with government laws.

9.6. Government Regulation of Compensation

l. Compensation implementation is subject to state and federal regulations.

ll. A majority of states have minimum wages.

lll Most states also regulate hours of work and overtime payments.

a. Wage and Hour Provisions

 Minimum wage rate applies to the actual earning rate before any added overtime premiums.

 The overtime wage rate is 1.5 times the base rate; it must be paid for all hours worked over 40 during a given week.

 Compensatory time (comp time) is time off in return for overtime work.

b. Minimum Wage and Pay Compression

 Compression of pay between new and experienced employees is caused by the higher starting salaries of new employees and the differential between hourly workers and managers.

 Pay rate compression is market, not government, based. To minimize pay rate compression,

o Reward high-performance and merit-worthy employees with large pay increases.

o Design the pay structure to allow a widespread between hourly and supervisory employees.

o Prepare high-performing employees for promotions to jobs with higher salary levels.

o Provide equity adjustments for selected employees hardest hit by pay compression.

b. Child Labor Provisions

 Minimum wage makes it difficult for high school students and young adults to find jobs because employers do not want to pay workers without experience the same rate as adults with experience.

 Age 16 is the minimum age required for employment.

c. Pay Equity Provisions: Although laws protect employees against Figure 9.10 against pay discrimination, it still occurs.

. EOC (Optional) Discussion Question #3: 5 minutes total.

Discussion Activity 3

Describe the basic steps in conducting a wage and salary survey. What are some factors to consider? One of the objections to granting wage increases on a percentage basis is that the lowest-paid employees, who are having the most trouble making ends meet, get the smallest increase, while the highest-paid employees get the largest increase. Is this objection a valid one? Explain.

CO 9.7: Design a compensation scorecard.

9.7. Compensation Assessment

l. After a compensation system is running, its effectiveness is important in linking compensation with strategy.

ll. An effective compensation system will:

 help the company detect potential compensation problems

 make compensation decisions more transparent

Figure 9.11

 improve the alignment of compensation decisions with organizational objectives.

lll. The compensation scorecard displays the results for all the measures used to monitor and compare compensation among internal departments and units.

EOC (Optional) Discussion Question #4: 5 minutes total.

Discussion Activity 4

What is a compensation scorecard and how does it help align a company’s strategy with its compensation system?

Discussion Questions

1. Question: MX, the fintech company, does the following for their employees: free lunches and dinners twice a week, discounted massages from an onsite masseuse, comprehensive healthcare insurance, unlimited vacation days, competitive salaries, bonuses if the company meets targets, and an open and transparent work environment that embraces diversity and inclusion. Determine which of these compensation components belong to (1) indirect, (2) direct, and (3) nonfinancial compensation.

Suggested answer: Students can put these activities in categories. Compensation has three components

 Direct compensation: employee wages and salaries, incentives, bonuses, and commissions

 Indirect compensation: benefits supplied by employers

 Nonfinancial compensation: employee recognition programs, rewarding jobs, organizational support, work environment, and flexible work hours

2. Question: Tomax Corporation has 400 employees and wishes to develop a compensation policy to correspond to its dynamic business strategy. The company wishes to employ a high-quality workforce capable of responding to a competitive business environment. Suggest different compensation objectives to match Tomax‘s

business goals.

Suggested answer: To obtain a high-quality workforce, Tomax will want to pay wages above the market rates. This policy will also help to reduce turnover while maintaining among employees a feeling of equity. If the company is organized into teams, it may want to pay employees on a pay-for-knowledge or skill-based system using broadbands. Operating in a dynamic environment, Tomax will want to obtain the most output for its compensation dollar by rewarding employees on a pay-for-performance basis.

3. Question: Since employees may differ in terms of their job performance, would it not be more feasible to determine the wage rate for each employee on the basis of their relative worth to the organization? Explain.

Suggested answer: One of the main points in this question is that jobs should be organized as much as possible to fit the needs of an organization; its employees, in turn, should be placed in those jobs that they are most capable of performing. If employees are properly placed, the differences in their relative worth to the organization should be consistent with the worth of their jobs. Variation in performance among persons in a particular job can be taken care of through performance ratings.

4. Question: Which job evaluation system would you use as an HR manager? Explain your answer.

Suggested answer: Answers will vary. Organizations determine the value of jobs through job evaluation. Job evaluation consists of determining the worth of jobs to establish which jobs should be paid more than others. Three methods of comparison:

o Rank the value of jobs from highest to lowest.

o Classify jobs to be benchmarked internally and externally.

o Award points to each job based on organizational objectives.

5. Question: Describe the basic steps in conducting a wage and salary survey. What are some factors to consider? One of the objections to granting wage increases on a percentage basis is that the lowest-paid employees, who are having the most trouble making ends meet, get the smallest increase, while the highest-paid employees get the largest increase. Is this objection a valid one? Explain.

Suggested answer: The employer must first decide on the jobs to be included in the survey. Next, the employer’s relevant labor market must be determined. The labor market will depend on the jobs for which the survey is being conducted. After completing these steps, the employer will identify other organizations it wishes to survey.

Organizations will be selected that will give a broad view of the employer’s competitors. Finally, the employer must decide on the type of information it wishes to collect. Although competitive wages will be the primary information collected, data on employee benefits or organizational pay practices can also be gathered.

While the argument cited is a common one, it ignores the need to develop and preserve adequate rate differentials with which to provide some incentive for employees to achieve positions of greater responsibility. Additionally, senior employees, those earning higher salaries, should be rewarded for their experience and knowledge that contribute to increased productivity.

6. Question: According to the Living Wage Calculator developed by Amy Glasmeier, Professor of Economic Geography and Regional Planning at MIT, the living wage rate for a family of four (two working adults, two children) was $16.54 per hour. What are the implications for raising a minimum wage rate to a livable wage? Do you think the government should increase the federal minimum wage? Explain your answer?

Suggested answer: Answers will vary. This is a controversial topic, and students could have a lively debate presenting the pros and cons of raising the minimum wage.

Pros: Proponents say that boosting the minimum wage will reduce poverty without reducing jobs.

Cons: But credible academic evidence shows otherwise: According to a 2007 summary of the minimum wage research authored by economists at the Federal Reserve Board and the University of California-Irvine, roughly 85 percent of the best research from the past two decades shows that a higher minimum wage reduces employment

Source: https://minimumwage.com/what-is-the-minimumwage/?utm_source=google&utm_medium=cpc&gclid=CjwKCAjwh5qLBhALEiwAioods0Sd1B63sDHTFfBFuxSJYtaLjax3p2G4gdNWkfduWweyatYoLCj7BoCfuEQAvD_BwE

7. Question: What is a compensation scorecard and how does it help align a company‘s strategy with its compensation system?

Suggested answer: The compensation scorecard collects and displays the results for all the measures that a company uses to monitor and compare compensation among internal departments or units. While different companies will use different measures of compensation, the scorecard creates a comparative tool within the organization that can reinforce desired outcomes that are unique to the company’s strategy. Managers in companies without compensation scorecards often struggle to know if the promotions, raises, bonuses, and pay adjustments they make are in line with the rest of the organization and its strategy. A scorecard improves transparency of how people are rewarded and makes managers responsible for how they spend company money.

Additional Discussion Questions

The following are discussion questions that do not appear in the text, PPTs, or courseware (if courseware exists) – they are for you to use as you wish. You can assign these questions several ways: in a discussion forum in your LMS; as whole-class discussions in person; or as a partner or group activity in class.

8 Question: How are companies being proactive at accessing external market pay rates? Suggested answer: Many companies are proactive at accessing external market pay rates by having their employees tell them when they get outside offers from competing firms. This information is often used by the current employer to ensure that they are paying market pay rates. For example, Netflix encourages its employees to get salary estimates from recruiters trying to poach them and relay that information back to their boss. If the boss wants to keep the employee, then they are encouraged to give the employees raises to make sure the employees don‘t leave for the competing firm. As Netflix CEO Reed Hastings points out, ―It costs more to lose people and to recruit replacements than to overpay a little in the first place.‖

Additional Activity

The following are activities and assignments developed by Cengage but not included in the text, PPTs, or courseware (if courseware exists) – they are for you to use if you wish.

Internet Research. There are many sites available for companies to discover how to pay employees. Look at these two websites and report your findings to the class.

1. Go to the Payscale, Buffer, and Salary List. Buffer is a site that not only offers salary data, but also offers free resources that any can access and use. They have a transparent salary calculator, examples and explanations of their job levels, and show how to create a career framework

2. Glassdoor provides a safe platform where people could anonymously share information about their pay and company in return for free information about other companies and salaries. Glassdoor now provides a platform where you can view salary information, company reviews, and job postings. You can even figure out who the top paying companies are and target your search accordingly. in 2019 Glassdoor listed the 25 highest paying companies in the United States. Looks like healthcare, technology, and consulting are the best options

Case Study 1: Pay Decisions at Performance Sports

1. Question: What factors should Perkins and Balkin consider when setting the wage for the purchasing agent position? What resources are available for them to consult when establishing this wage?

Suggested answer: The ―going rate‖ of pay for purchasing agents is the factor most likely to influence the compensation for these individuals. Perkins must also consider the experience she wants for this position and factor this into her pay decision. Another consideration that could affect the pay of the purchasing agent is whether the labor market for these individuals is tight or loose. Finally, Perkins will need to consider the person‘s current wage (if working) and how much additional money will be needed to entice the person to change employers.

Published wage surveys available from state and federal government agencies would be excellent sources of wage information. Professional associations may also be of some assistance. Finally, Perkins could call other employers to see what they pay their purchasing agents.

2. Question: Suggest advantages and disadvantages of a pay-for-performance policy for Performance Sports.

Suggested answer: The primary advantage of a pay-for-performance program is that it ties employee effort and performance directly to the compensation received. Studies generally show that organizational productivity increases when employees are paid on a pay-forperformance basis.

Drawbacks of a pay-for-performance program include establishing performance standards, determining how employee performance should be measured, and the size of the monetary reward to be given to outstanding employees. Pay-for-performance may be unpopular with average or below-average producers, and it can be seen as unfair when only some groups of employees can increase their wages while other groups are denied the opportunity to work under this payment program.

3. Question: Suggest a new payment plan for the customer service representatives

Suggested answer: Several options are available to pay the customer service representatives. New representatives can be paid a straight wage until they completely learn the job. At that time, they could be compensated on a straight rate, commission, or a combination of salary and sales commission. Sales commissions could vary based on dollar volume of sales made. For example, a lower sales commission could be paid for sales up to a certain dollar amount and increase as sales go up.

Case Study 2: An In-N-Out Pay Strategy: Costa Vida’s Decision to Boost Pay

1. Question: Why is it important for pay to be externally fair?

Suggested answer: In discussing this question with the class, turn it around and ask what would likely happen if a firm‘s pay was not externally fair. Also, ask them if there is a definition of ―fair‖ that everyone would recognize.

2. Question: Why is it important for pay to be internally fair?

Suggested answer: Again, in discussing this question with the class, turn it around and ask what would likely happen if a firm‘s pay was not internally fair.

3. Question: What should Costa Vida’s compensation strategy look like? Hint: What are the company objectives and how can employee pay help to achieve those objectives?

Suggested answer: There will be many answers to this question. The firm‘s compensation strategy is directed toward attracting quality employees who in turn will attract customers

and toward retaining such quality employees. To the extent that this may involve higher employee costs it is assumed that the increase in costs will be more than offset by the increased revenues from happier customers.

4. Question: What should the pay structure look like? What pay mix would you recommend?

Suggested answer: There will be many suggestions. There is not necessarily a right or wrong answer, but respondents should be prepared to show how their suggestion would accomplish what was discussed in the above question. Possibilities might include a modest fixed hourly wage which would increase somewhat for those who remain with the firm and incentive pay based on sales volume and/or profitability of each store. In that way employees would be encouraged to work as a team to increase overall revenues for their location that would then enable the individual to afford what is being paid.

5. Question: How should Nathan communicate a new compensation strategy to his franchisee owners and managers?

Suggested answer: There are many alternative ways of communicating the approach to franchise owners and managers. However, some franchise organizations have periodic conferences (at a physical location or online) in which they discuss common problems and opportunities. Such a conference would not only provide for communication to the franchisees but also enable interactive discussion among all concerned.

6. Question: What effect will paying higher wages have on Costa Vida in the short term? What effect will it have in the long term? Explain

Suggested answer: Depending on the pay mix that is used, the effect might be a shortterm increase in costs more than offset with higher profits in the long run. It is also possible that if the increased pay is in the form of incentive pay, there might be no change in shortterm costs and only the potential for higher profits.

Additional Resources

Cengage Video Resources



MindTap Videos:

o Chapter 09: Concept Clip: Types of Compensation

o Chapter 09: On The Job: Tough Mudder- Compensation

Chapter 10: Pay-For-Performance:

Incentive Rewards

Instructor Manual

Instructor Manual: Snell/Morris, Managing Human Resources 19e, c23, ISBN: 9780357716519; Chapter #1: The Opportunities and Challenges of Human Resources Management

Snell/Morris, Managing Human Resources 19e, c23, ISBN 9780357716519; Chapter #10: Pay-ForPerformance: Incentive Rewards

Table of Contents

Purpose and Perspective of the Chapter 137

Chapter Objectives 137

Key Terms 137

What's New in This Chapter 138

Chapter Outline 139

Discussion

Questions……………………………………………………………………………………………

Additional Discussion Questions 149

Additional Activities and Assignments 149

Case Study 1: CEO Pandemic Pay… Taking One for the Team or Window Dressing?.............16 Case Study 2: Team-Based Incentives: Not Your Usual Office…………………………………………….17

Additional Resources 151

Cengage Video Resources.................................................................................................................................151

Purpose and Perspective of the Chapter

Studies show that pay-for-performance plans can increase job satisfaction, commitment to the company, and trust in management if handled correctly. The process of (1) choosing the right incentive plans based on organizational objectives, (2) setting up performance measures, and (3) administering those incentive plans may seem a bit daunting especially since so much can go wrong.

This chapter discusses incentive plans in terms of the objectives they hope to achieve and the various factors that may affect their success. Because many organizations have implemented broad-based incentive programs to differentiate employees and their performance, for discussion purposes incentive plans are grouped into three broad categories: individual incentive plans, group incentive plans, and enterprise incentive plans Some special incentive plans for professional employees and executives are discussed.

Chapter Objectives

The following objectives are addressed in this chapter:

1. Give examples of a strategic incentive program, including aligning incentives with company objectives.

2. Identify clear and quantifiable performance measures.

3. Summarize performance measures that incentivize employees.

4. Differentiate between individual incentive programs such as piecewise, sales commission, and standard hourly rates.

5. Differentiate between team incentive programs like gainsharing, Scanlon, and improshare.

6. Differentiate between enterprise-wide incentive programs that involve stock options, profit-sharing, and stock ownership.

7. Compare how incentives for professional employees might differ from other types of employees.

8. Explain how compensation for executives impacts a firm.

Key Terms

Bonus: An incentive payment that is supplemental to the base wage

Combined salary and commission plan: A compensation plan that includes a straight salary and a commission

Differential piece rate: A compensation rate under which employees whose production exceeds the standard amount of output receive a higher rate for all of their work than the rate paid to those who do not exceed the standard amount

Employee stock ownership plans (ESOPs): Stock plans in which an organization contributes shares of its stock to an established trust for the purpose of stock purchases by its employees

Gainsharing plans: Programs under which both employees and the organization share financial gains according to a predetermined formula that reflects improved productivity and profitability

Improshare: A gainsharing program under which bonuses are based on the overall productivity of the work team

Merit guidelines: Guidelines for awarding merit raises that are tied to performance objectives

Perquisites: Special nonmonetary benefits given to executives; often referred to as perks based on the overall productivity of the work team nonmonetary benefits given to executives; often referred to as perks

Profit sharing: Profit sharing is any procedure by which an employer pays, or makes available to all regular employees, special current or deferred sums based on the organization‘s profits

Salary plus bonus plan: A compensation plan that pays a salary plus a bonus achieved by reaching targeted sales goals

Scanlon plan: A bonus incentive plan using employee and management committees to gain cost-reduction improvements

Spot bonus: An unplanned bonus given for employee‘s effort unrelated to an established performance measure

Standard hour plan: An incentive plan that sets rates based on the completion of a job in a predetermined standard time

Straight commission plan: Tying pay to some measure of individual, group, or organizational performance

Straight piecework: An incentive plan under which employees receive a certain rate for each unit produced

Straight salary plan: A compensation plan that permits salespeople to be paid for performing various duties that are not reflected immediately in their sales volume

Team incentive plan: A compensation plan in which all team members receive an incentive bonus payment when production or service standards are met or exceeded

Variable pay: Tying pay to some measure of individual, group, or organizational performance

What's New in This Chapter

The following elements are improvements in this chapter from the previous edition:

Chapter # New component(s)

Chapter 10 ● New research shows that unless done correctly carefully, pay for performance can hurt the company.

Chapter 10 ● Spot bonuses were found to be a great way to encourage employees during the COVID pandemic.

Chapter 10 ● Recognition at work is extremely important to employees and frequent public recognitions are the preferred method by employees.

Chapter 10 ● Are CEOS still being paid too much even in the face of a global pandemic?

Chapter Outline

The following outline organizes activities (including any existing discussion questions in PowerPoints or other supplements) and assessments by chapter (and therefore by topic), so that you can see how all the content relates to the topics covered in the text CO 10. 1: Give examples of a strategic incentive program, including aligning incentives with company objectives.

10.1. Strategic Reasons for Incentive Plans

Figure 10.1

l. Variable pay: tying pay to some measure of individual, group, or organizational performance. Figure 10.2

ll. Variable pay programs consist of bonuses, incentives, or recognition for good work.

lll. Variable pay allows the organization to align the employees’ interests and outcomes with those of the organization and it is used to exercise fairness and equity

lV. Incentive rewards are based entirely on a pay-for-performance philosophy.

(Optional) Knowledge Check: <5 minutes total

Use Figure 10.1 to discuss the types of incentive plans

Use Figure 10.2 to discuss the performance that an employee or group must attain to qualify for incentive payments.

10.1A. Incentive Plans as Links to Organizational Objectives

l. Contemporary arguments for incentive plans link compensation rewards to organizational goals.

ll. The degree of success depends on several factors including

Figure 10.3

 identifying important organizational metrics to measure employee performance

 a customized incentive plan.

(Optional) Knowledge Check: <5 minutes total

Use Figure 10.3 to discuss the advantages of incentive pay programs

lll. Variable pay plans may not achieve objectives or lead to improvements.

 Employees may question the equity of the system.

 Employees might not be as motivated by variable pay incentives as managers assume.

 The challenge is to tie performance to organizational goals and connect employees’ behavior to the resulting reward.

10.1B. Requirements for a Successful Incentive Plan

l. Employees should consider incentive payments as a reward to be earned, not an entitlement.

ll. Successful incentive plans:

 Identify important organizational metrics that encourage employee behavior.

 Involve employees.

 Find the right incentive payout.

Instructor Manual: Snell/Morris, Managing Human Resources 19e, c23, ISBN: 9780357716519; Chapter #1: The Opportunities and Challenges of Human Resources Management

 Establish a clear link between performance and payout.

EOC (Optional) Discussion Question #1: 5 minutes total.

Discussion Activity 1

Working individually or in groups, identify the factors for a successful incentive plans.

CO 10.2: Identify clear and quantifiable performance measures.

10.2. Setting Performance Measures Figure 10.4

l. Measuring and differentiating performance among employees is a difficult task for managers.

ll. Measurement can communicate the importance of established organizational goals.

CO 10.3: Summarize performance measures that incentivize employees.

10.3. Administering Incentive Plans; Guidelines:

 Allowing incentive payments to become pay guarantees defeats the motivational intent

 Annual salary budgets must be large enough to reward and reinforce exceptional performance.

 The overhead costs associated with planned implementation and administration must be determined.

CO 10.4: Differentiate between individual incentive programs such as piecewise, sales commission, and standard hourly rates.

10.4. Individual Incentive Plans Flexibility describes the design of plans. Figure 10.5 Figure 10.6

10.4A. Piecework

l. Straight piecework: an incentive plan under which employees receive a certain rate for each unit produced.

ll. A differential piece rate: a compensation rate under which for all of their work

lll. The piecework system is more likely to succeed in the following situation:

 Units of output can be measured readily.

 The quality of the product is less critical.

 The job is fairly standardized.

 A constant flow of work can be maintained.

a. Computing the Piece Rate

 Incentive rates based on hourly wage rates paid for the type of work performed.

b. Piecework: The Drawbacks:

 It may not always be an effective motivator.

 Some jobs are not suited to piecework.

 Piecework incentive systems can work against promoting cooperation.

 Inappropriate:

o When quality is more important than quantity

o When technology changes are frequent

o When productivity standards on which piecework must be based are difficult to develop

10.4B. Standard Hour Plan: sets rates based on completing a job in a predetermined time.

EOC (Optional) Discussion Question #2: 5 minutes total.

Discussion Activity 4

Contrast the differences between straight piecework, differential piece rate, and standard hour plans. Explain where each plan might be used.

10.4C. Bonuses

l. A bonus: an incentive payment supplemental to the base wage.

ll. A spot bonus: an unplanned bonus given for employee’s effort unrelated to a performance measure.

10.4D. Merit Pay: links an increase in pay to successful employee performance Figure 10.5

l. A merit increase must be 7 to 9 percent to be a pay motivator.

a. Problems with Merit Raises

 Merit guidelines: used for awarding merit raises tied to performance appraisals

 The amount of a merit increase can change every year.

 When setting merit percentage guidelines, organizations should consider individual performance along with such factors as training, experience, and current earnings.

EOC (Optional) Discussion Question # 5: 5 minutes total.

Discussion Activity 4

A frequently heard complaint about merit raises is that they do little to increase employee effort. What are the causes of this belief? Suggest ways in which the motivating value of merit raises may be increased

10.4E. Incentive Awards and Recognition Figure 10.6

l. Incentive awards and employee recognition are an important part of an employer’s pay-for-performance compensation strategy.

ll. Some organizations use software or other tools to encourage employees to perform.

10.4F. Sales Incentives: Sales employees must be highly motivated.

a. Unique Needs of Sales Incentive Plans

 Gamification motivates sales teams. It:

o Rewards behaviors immediately.

o Rewards behaviors consistently.

o Rewards the correct behaviors.

o Uses data-driven gamification.

o Uses team games.

o Uses public recognition more often than money.

b. Type of Sales Incentive Plans

 Straight salary plan: pays salespeople for performing duties not reflected immediately in their sales volume.

 Straight commission plan: based on a percentage of sales.

 Combined salary and commission plan: includes a straight salary and a commission.

 Salary plus bonus plan: pays a salary plus a bonus by reaching targeted sales goals. (Optional) Knowledge Check: <5 minutes total What are the reasons behind the different payment methods for sales employees?

CO 10. 5: Differentiate between team incentive programs like gainsharing, Scanlon, and improshare.

10.5. Group Incentive Plans

l. Group plans enable employees to share in the benefits of improved efficiency.

ll. These plans encourage cooperation among employees.

10.5A. Team Compensation

l. A team incentive plan: all team members receive a bonus when production or service standards are met or exceeded.

ll. This approach fosters team member cooperation.

lll. Three-steps:

 Set performance measures upon which incentive payments are based.

 The size of the incentive bonus must be determined.

 A payout formula is established and fully explained to employees

lV. Problems associated with team competition:

 Individual team members may perceive that ―their‖ efforts contribute little to team success or to the attainment of the incentive reward.

 Team members may be afraid that one individual may make the others look bad, or that one individual may put in less effort than others but share equally in team rewards the ―free-rider‖ effect.

 Complex payout formulas or insufficient payout rewards may diminish employees‘ motivation.

10.5B. Gainsharing Incentive Plans

l. Gainsharing plans: both employees and the organization share financial gains according to a formula that reflects improved productivity and profitability.

ll. Variations include the Scanlon plan and the Improshare plan.

a. The Scanlon Plan Figure

10.7

 The Scanlon plan: a bonus incentive plan using employee and management committees to gain cost-reduction improvements.

 Financial incentives are ordinarily offered to all employees

b Improshare: a gainsharing program under which bonuses are based on team productivity.

c. Lessons from the Scanlon Plan and Improshare

 To gain employee cooperation, employees must feel involved and identify with the organization.

EOC (Optional) Discussion Question #5: 5 minutes total.

Discussion Activity 4 What are the reasons for the success of the Scanlon and improshare plans?

CO 10.6: Differentiate between enterprise-wide incentive programs that involve stock options, profit-sharing, and stock ownership

10.6. Enterprise Incentive Plans

l. All organizational members participate in an enterprise incentive plan.

ll. common enterprise incentive plans include profit sharing, stock options, employee stock ownership plans.

lll. Employee stock ownership plans (ESOPs): stock plans in which an organization contributes shares of its stock to an established trust for the purpose of stock purchases by its employees.

10.6A. Profit-Sharing Plans

l. Profit sharing: an employer pays, or makes available to all regular employees,

current or deferred sums based on the organization’s profits.

ll. They are intended to give employees the opportunity to increase earnings by contributing to increased organization’s profits.

a. Variations in Profit-Sharing Plans: difference in the proportion of profits shared with employees and in payment distribution

b. Weaknesses of Profit-Sharing Plans

 Employees might not be able to control the factors that create profits.

 Since payments occur once a year or upon retirement, the motivational value may be reduced.

EOC (Optional) Discussion Question #6: 5 minutes total.

Discussion Activity 4

Because of competitive forces within your industry, you have decided to implement a profit-sharing plan for your employees. Discuss the advantages of profit sharing and identify specific characteristics that will ensure success for your plan.

10.6B. Stock Options

l. Stock option plans: grant employees the right to purchase shares of stock at a guaranteed price during a designated time period.

ll. The organization hopes that this will increase employee productivity and cause the stock to rise.

lll. Criticism largely focuses on the extravagance of executive stock option plans and dubious corporate accounting procedures.

10.6C Employee Stock Ownership Plans: an employer-established trust that qualifies as a tax-exempt employee trust.

l. Employees don’t buy the shares.

ll. The company contributes its own shares to the plan, contributes cash to buy its own stock, or borrows money to buy its own stock.

lll. An ESOP provides tax benefits for the company, the employees, and the sellers.

iV. The ESOP holds the stock for the employees.

a. Advantages of Employee Stock Ownership Plans

 Employers use ESOPs to provide retirement benefits for employees.

 Favorable tax incentives encourage its use for employers to provide retirement benefits for employees at relatively low cost.

 ESOPs also provide an incentive for employees to increase productivity.

 ESOPs can increase employees’ pride of ownership in the organization

b. Problems with Employee Stock Ownership Plans

 When the value of the company’s stock falls, the value of the employee’s retirement plan falls

 The more retirement income comes from these plans, the more dependent a pensioner becomes on the price of the company stock

 ESOP contributions are not guaranteed by the federally established Pension Benefit Guaranty Corporation.

CO 10. 7: Compare how incentives for professional employees might differ from other types of employees.

10.7. Incentives for Professional Employees Figure 10.8

l. For professional employees, it is important to motivate them to be more creative.

ll. To incentivize professional workers, pay should be based on overall performance over time and not be limited to a set of tasks.

lll. Rewards should provide: autonomy to the worker, opportunity to master a skill, purpose.

EOC (Optional) Discussion Question #7: 5 minutes total.

Discussion Activity 4

Working individually or in groups, identify the 3 factors for a successful incentive plan.

CO 10.8: Explain how compensation for executives impacts a firm.

10.8. Incentives for Executives

10.8A. The Executive Pay Package: Components:

 Base salary

 Short-term incentives or bonuses

 Long-term incentives or stock plans

 Benefits

 Perks

a Executive Base Salaries: represent between 30 and 40 percent of total annual compensation.

 A technique called competitive benchmarking sets executive pay to remain competitive for executive talent.

b. Executive Short-Term Incentives

 Annual bonuses, usually given in cash, represent the main element of executive short-term incentives.

 They should be based on the contribution the individual makes to the organization.

c. Executive Long-Term Incentives

 Stock options are the primary long-term incentive for executives.

Figure 10.9

 A variety of incentive plans tie rewards to performance results

 Stock options can retain key executives when exercising the options is linked to a vesting period.

d. Executive Benefits

 Benefits offered to executives may be the same as those offered to other employees, but the benefits are broader in coverage and free of charge.

 Additional executive benefits: estate planning, payment of mortgage interest, and legal help.

e. Executive Perks

 Perquisites (perks) are special nonmonetary benefits given to executives

10.8B. Executive Compensation: Ethics and Accountability

Figure 10.10

l. Corporate compensation committees justify big bonuses in the following ways:

 Large financial incentives are a way to reward superior performance.

 Business competition is pressure-filled and demanding.

 Good executive talent is in great demand.

 Effective executives create share value.

(Optional) Knowledge Check: <5 minutes total Use Figure 10.10 to discuss CEO compensation. Ask students to suggest any local companies that have executives who receive high compensation.

10.8C. Executive Compensation Reform

l. Several changes will impact future executive compensation

 The IRS looks for tax code violations in connection with hefty executive pay packages

 The Securities and Exchange Commission has disclosed rules that require companies on the New York Stock Exchange and NASDAQ to disclose the true size of their top executive pay packages.

 The Financial Accounting Standards Board (FASB) requires that stock options be recognized as an expense on income statements.

 The Dodd-Frank Wall Street Reform and Consumer Protection Act requires companies to disclose the median total compensation of all its employees in comparison to the total CEO compensation and gives voting shareholders the right to approve a company’s executive salaries.

Discussion Questions

1. Question: Working individually or in groups, identify the 3 factors for a successful incentive plan.

Suggested answer: For an incentive plan to succeed, employees must believe in it. Employees must be able to see a clear connection between the incentive payments they receive and their job performance. This connection is more visible if there are objective quality or quantity standards by which they can judge their performance. Management should guard against incentive payments being seen as an entitlement. Instead, these payments should be viewed as a reward that must be earned through effort. This perception can be strengthened if the incentive money is distributed in a separate check. Compensation specialist Joanne Sammer notes the following as characteristics of a successful incentive plan:

 Identify important organizational metrics that encourage employee behavior.

 Involve employees. Incentive programs should seem fair to employees.

 Find the right incentive payout. Payout formulas should be simple and understandable.

 Establish a clear link between performance and payout.

2. Question: Assume you are being asked to measure the individual pay, group pay and enterprise pay for a new software engineer position at Adobe. Write down how you would measure this person‘s performance as it relates to these three areas of pay.

Suggested answer: Incentive plans based on productivity should (1) only reward

performance and not be guaranteed, (2) be large enough to reward and enforce exceptional performance, and (3) not be too burdensome for the organization to administer.

3. Question: Based on the performance measures you put together for a new software engineering position at Adobe, what is your biggest concern in administering this incentive plan? Explain your answer.

Suggested answer: Answers will vary. If management is expecting to gain the cooperation of its employees in improving efficiency, then employers must permit employees to become involved psychologically as well as financially in the organization. The success of an incentive pay plan depends on the organizational climate in which it must operate, employee confidence in it, and its suitability to employee and organizational needs.

4. Question: Contrast the differences between straight piecework, differential piece rate, and standard hour plans. Explain where each plan might best be used. What are the reasons behind the different payment methods for sales employees?

Suggested answer: Straight piecework is an incentive plan under which employees receive a certain rate for each unit produced. A differential piece rate is a compensation rate under which employees whose production exceeds the standard amount of output receive a higher rate for all of their work than the rate paid to those who do not exceed the standard amount. The piecework system is more likely to succeed in the following situation:

 Units of output can be measured readily.

 The quality of the product is less critical.

 The job is fairly standardized.

 A constant flow of work can be maintained.

5. Question: A frequently heard complaint about merit raises is that they do little to increase employee effort. What are the causes of this belief? Suggest ways in which the motivating value of merit raises may be increased. What are the reasons for the success of the Scanlon and improshare plans?

Suggested answer: Compensation specialists recognize the following problems with merit pay plans:

 Money available for merit increases may be inadequate to satisfactorily raise all employees’ base pay.

 Managers may have no guidance in how to define and measure performance; there may be vagueness regarding merit award criteria.

 Employees may not believe that their compensation is tied to effort and performance; they may be unable to differentiate between merit pay and other types of pay increases.

 Employees and their managers may hold different views of the factors that contribute to job success.

 Merit pay plans may create feelings of pay inequity.

Perhaps the most important lesson to be learned from the Scanlon plan and improshare or any gainsharing program is that management expecting to gain the cooperation of its employees in improving efficiency must permit them to become involved psychologically as well as financially in the organization. If employees are to contribute maximum effort, they must have a feeling of involvement and identification with their organization, which does not come out of the traditional manager-subordinate relationship.

Organizations using a true merit pay plan often base the percentage pay raise on merit guidelines tied to performance appraisals. For example, a certain pay increase, such as ―3 percent,‖ will be tied to a certain performance evaluation, such as ―above average.‖ The percentages may change each year, depending on various internal or external concerns such as profit levels or national economic conditions as indicated by changes in the consumer price index. To prevent all employees from being rated outstanding or above average, managers may be required to distribute the performance rating according to some preestablished formula (such as only 10 percent can be rated outstanding). Additionally, when setting merit percentage guidelines, organizations should consider individual performance along with such factors as training, experience, and current earnings.

6. Question: Because of competitive forces within your industry, you have decided to implement a profit-sharing plan for your employees. Discuss the advantages of profit sharing and identify specific characteristics that will ensure success for your plan. Suggested answer: Profit sharing is any procedure by which an employer pays, or makes available to all regular employees, special current or deferred sums based on the organization’s profits. As defined here, profit sharing represents cash payments made to eligible employees at designated time periods, as distinct from profit sharing in the form of contributions to employee pension funds.

Profit sharing plans are intended to give employees the opportunity to increase their earnings by contributing to the growth of their organization’s profits. These contributions may be directed toward improving product quality, reducing operating costs, improving work methods, and building goodwill rather than just increasing rates of production.

7. Question: Create a list of different types of incentives companies can offer professionals not interested in administrative positions. Suggested answer: So how should you incentivize your professional workers? Pay is still important, but it should be based more on overall performance over time, and it should not limit them to a set of certain tasks. In other words, make sure your incentives are based around the impact of someone‘s work and not just that a certain task was

completed. Such rewards should provide (1) autonomy to the worker, (2) opportunity to master a skill, and (3) purpose (e.g., helping to build a better organization, curing cancer, alleviating poverty).

8. Question: Do you believe executives are overpaid? Discuss this issue with someone else and try to understand a different perspective.

Suggested answer: Answers will vary. Almost three in four Americans think CEOs and top-level executives are overpaid. Yet at the same time, most Americans still underestimate how much CEOs make. The median compensation for CEOs of the biggest 500 U.S. companies is 12.3 million 10 times what most Americans think.

While the average American may believe executives are overpaid, corporate compensation committees justify big bonuses in the following ways:

 Large financial incentives are a way to reward superior performance.

 Business competition is pressure-filled and demanding.

 Good executive talent is in great demand.

 Effective executives create shareholder value. Others justify high compensation as a fact of business life, reflecting market compensation trends. Many argue that such exorbitant pay gaps are not only bad for the reputations of firms that pay them, but also that such gaps can create discontent in the general population.

Additional Discussion Questions

The following are discussion questions that do not appear in the text, PPTs, or courseware (if courseware exists) – they are for you to use as you wish. You can assign these questions several ways: in a discussion forum in your LMS; as whole-class discussions in person; or as a partner or group activity in class.

1. Question: What are incentives for professional employees?

Suggested answer: For professional employees, it is important to motivate them to be more creative. To incentivize professional workers, pay should be based more on overall performance over time, and it should not limit them to a set of certain tasks. Rewards should provide (1) autonomy to the worker, (2) opportunity to master a skill, and (3) purpose.

Additional Activity

The following are activities and assignments developed by Cengage but not included in the text, PPTs, or courseware (if courseware exists) – they are for you to use if you wish.

Internet activity: Go to: https://www.americanactionforum.org/insight/a-decade-of-doddfrank-the-future-of-dodd/ and update Dodd-Frank act. Report your findings to the class.

The Dodd-Frank Wall Street Reform and Consumer Protection Act (Pub. L. 111-203) requires companies to disclose the median total compensation of all its employees in comparison to the total CEO compensation and gives shareholders of a company ―say on pay,‖ which means that voting shareholders of a company must ultimately approve executive salaries.

Case

Study 1: CEO

Pandemic

Pay… Taking One for the Team or Window Dressing?

1. Question: Are CEOs and key corporate executives worth the large pay packages they receive? Explain.

Suggested answer: Answers will vary. if you ask workers who have seen their CEOs steer back their companies from the edge of bankruptcy and weathered them through a pandemic, they probably would not complain too much about their salary size.

2. Question: Do you agree with Peter Drucker that corporate executives should receive compensation packages no larger than a certain percentage of the pay of hourly workers? Explain.

Suggested answer: Answers will vary. In an effort to build unity and keep people in jobs, executives decided to make personal sacrifices during the pandemic. For example, Ronald Rittenmeyer, CEO of Tenet Healthcare Corp. gave up three months‘ pay roughly $390,000 to a fund that was set up to help struggling employees. On the other hand, Rittenmeyer‘s salary, including bonuses, is close to $2 million. This does not include his stock awards worth over $11 million. It‘s little wonder why one of the largest U.S. unions said Rittenmeyer‘s donation amounted to little more than ―a gesture‖.

3. Question: Has the Dodd-Frank Wall Street Reform and Consumer Protection Act giving shareholders the right to vote on executive pay influenced the size of these packages? Explain.

Suggested answer: Answers will vary. The shareholders can influence the size of executive packages, but they also have to offer executives competitive salary packages or they risk losing talented executives who generate revenue for the shareholders.

Case Study 2: Team-Based Incentives: Not Your Usual Office

1. Question: Do results from the survey illustrate typical complaints about teams and specifically about team incentive rewards? Explain.

Suggested answer: Complaints noted by the representatives are typical problems found In research studies on ineffective teams. Not all employees like working in teams and may prefer working alone or in an environment where they either rise or fall on their own merit. Free-riders (those who benefit from the superior work of others) can be low producing employees or simply employees who take advantage of the high productivity of the team. For example, teams made up of students often complain that one team member doesn’t pull his or her share and becomes a free-rider.

Teams do not always produce synergy especially when team members do not get

along with each other or refuse to share their skills or knowledge in a collaborative effort. (Chapter 4 discusses the components of positive team synergy). Also, managers of teams must assure employees that all teams have an equal opportunity to earn bonuses. When performance goals favor one team over another, problems always arise.

2. Question: If appropriate, what changes would you recommend to improve the incentive reward program? Be specific.

Suggested answer: Students may offer various changes to improve the incentive reward program. Several of the more obvious changes might be as follows:

 Ensure that all teams have an equal chance to earn the maximum. If some regions are more difficult than others, then higher incentive pay might be greater for those regions.

 The team bonus could be divided among team members based on their individual contributions. Thus, superior performers would receive larger bonuses compared to low producers. Unequal cash distributions can serve to eliminate the free-rider problem. An evaluation of each team member can be based upon peer reviews, supervisory evaluations, individual performance measurement scores, or a combination of these methods.

3. Question: Would management have benefited from employee involvement in the initial design and implementation of the program? Explain.

Suggested answer: When establishing teams, experience has demonstrated that it is always prudent to involve employees both in the design and implementation of the program. Employee involvement helps to achieve commitment to the program since employees have a say in program design. This is particularly true when setting performance measures. Employees can also serve to identify problem areas areas unanticipated by management. Also, employees who ―buy into‖ the concept of teams can serve to answer the questions of employees who might have reservations about how the team concept will work or how employees can benefit from teaming.

Additional Resources

Cengage Video Resources

 MindTap Videos:

o Chapter 10: Concept Clip: Balanced Scorecard

o Chapter 10: On The Job: Tough Mudder- Rewards

Instructor Manual: Snell/Morris, Managing Human Resources 19e, c23, ISBN: 9780357716519; Chapter #1: The Opportunities and Challenges of Human Resources Management

Chapter 11: Employee Benefits Instructor Manual

Instructor Manual: Snell/Morris,, Managing Human Resources 19e c23 ISBN; 9780357716519; Chapter #11: Employee Benefits

Table of Contents

Purpose and Perspective of the Chapter 153

Chapter Objectives 153

Key Terms 153

What's New in This Chapter 154

Chapter Outline 154

Discussion Questions……………………………………………………………………………………………

Additional Discussion Questions 163

Additional Activities and Assignments 163

Case Study 1: Adobe‘s Family-Friendly Benefits: An Unexpected Backlash…………………………13

Case Study 2: Evaluating the Work-Life Climate in Your Company………………………………..……14

Additional Resources 166

Purpose and Perspective of the Chapter

Approximately three in five people report benefits and perks being among their top considerations before accepting a job. Maybe this is why companies like Netflix provide one paid year of parental leave to new parents, or why Spotify covers costs for egg freezing and fertility assistance, or why Airbnb gives its employees an annual stipend of $2,000 to travel and stay in an Airbnb listing anywhere in the world. Despite how cool many of these benefits may be, the cost of providing them has been climbing sharply. Due to increased access to employer information through social media and search engines, employees are increasingly aware of the benefits they receive and how they compare to what other companies are offering. Hence, benefits act as a key source of advantage (or disadvantage) for companies.

Chapter Objectives

The following objectives are addressed in this chapter:

1. Detect cost-effective strategies companies use to develop benefits plans.

2. Summarize the employee benefits required by U.S. law.

3 Describe the types of work-life benefits, retirement programs, and pension plans as well as the regulations related to them.

Key Terms

Backup care program: A benefit program whereby an employer provides or subsidizes temporary care for its employee‘s elders or children when their regular arrangements fall through.

Contributory plan: A pension plan in which contributions are made jointly by employees and employers.

Defined benefit plan: A pension plan in which the amount an employee is to receive on retirement is specifically set forth.

Defined contribution plan: A pension plan that establishes the basis on which an employer will contribute to the pension fund.

Disease management programs: Programs that provide patients and their caregivers with information on monitoring and treating medical conditions, while coordinating communication between them, their health care providers, employers, and insurers.

Elder care: Care provided to an elderly relative by an employee who remains actively at work. Employee assistance programs (EAPs): Services provided by employers to help workers cope with a wide variety of problems that interfere with the way they perform their jobs.

Flexible benefits plans (cafeteria plans): Benefit plans that enable individual employees to choose the benefits that are best suited to their particular needs.

Health maintenance organizations (HMOs): Organizations of physicians and health care professionals that provide a wide range of services to subscribers and dependents on a prepaid basis.

High-deductible health insurance plan (HDHP): A medical insurance plan characterized by high deductibles but lower premiums for workers and a health spending account to which employers contribute funds employees can keep should they leave the organization.

Noncontributory plan: A pension plan in which contributions are made solely by the employer.

Phased retirement: A program that allows its employees to gradually cut their hours before retiring.

Preferred provider organization (PPO): A network of physicians who establish an organization that guarantees lower health care costs to employers and their employees.

Sabbatical: Paid (or unpaid) time away from a job for 4 or more weeks employees take off to renew themselves before returning to work.

Severance pay: A one-time payment sometimes given to an employee who is being involuntarily terminated.

Supplemental unemployment benefit (SUB): A plan that enables an employee who is laid off to draw weekly benefits from the employer, which draws from a fund created for this purpose, in addition to state unemployment compensation.

Vesting: A guarantee of accrued pension benefits to participants at retirement age, regardless of their employment status at that time

Wellness programs: Employer-sponsored programs designed to encourage employees to maintain and improve their health and wellbeing by getting regular checkups, eating properly, exercising, and managing their stress levels so as to prevent costly and protracted illnesses.

Workers’ compensation insurance: State-mandated insurance provided to workers to defray the loss of income and cost of treatment due to work-related injuries or illness.

What's New in This Chapter

The following elements are improvements in this chapter from the previous edition:

Chapter # New component(s)

Chapter 11 ● Updated information on the current status of the Patient Protection and Affordable Care Act (PPACA).

Chapter 11 ● An analysis of the increase in Employee Assistance Programs focused on mental health due to the Coronavirus pandemic.

Chapter 11 ● Expanded discussion on how the Mental Health Parity and Addiction Equity Act of 2008 requires mental health care benefits yet still does not help.

Chapter 11 ● New discussion about domestic partnership and fertility benefits.

Chapter Outline

The following outline organizes activities (including any existing discussion questions in PowerPoints or other supplements) and assessments by chapter (and therefore by topic), so that you can see how all the content relates to the topics covered in the text.

Benefits can represent more than 50 percent of the total payroll costs that an employer pays. Some benefits are legally required, while others are voluntarily granted by employers.

(Optional) Knowledge Check: <5 minutes total

Use Figure 11.1 to discuss the amount employers spend on benefits for employees. Ask students if they are surprised by the cost.

CO 11.1: Detect cost-effective strategies companies use to develop benefits plans.

11.1 Elements of a Successful Benefits Program Figure 11.1 l. Benefits can represent over 50 percent of payroll costs depending on

the types of benefits.

ll. Some benefits are required by law, whereas others are voluntarily granted by employers.

lll. Figure 11.1 shows the proportion of compensation that organizations pay in benefits,

11.1A. Selecting Benefits

l. Many organizations establish committees of managers and employees to administer, interpret, and oversee their benefits policies.

ll. Employees are more likely to be satisfied with benefits if they participated in establishing benefits policies.

a. Flexible Benefits: Employee benefits programs must adapt to social changes

 Flexible benefits plans (cafeteria plans): benefits plans that enable individual employees to choose the benefits best suited to individual needs.

 Employees are offered a basic benefits package of life and health insurance, sick leave, and vacation.

 This ensures a minimum level of coverage for employees.

11.1B. Administering Benefits

l. Administering a benefits program can be costly and time-consuming.

ll. Online employee benefits systems are mainstream but must be easy to navigate or employees do not use it.

11.1C. Communicating Employee Benefits: a key part of an effective benefits strategy

l. It helps employees realize what they get and why they should reduce benefits costs

ll. It is best to use multiple media techniques to convey this information.

lll. Guidelines:

 Avoid complex language.

 Explain the purpose behind a benefit and the value it offers employees.

 Use graphics.

 Provide numerous examples.

a. Cost Containment Strategies:

 Require employees to pay part of the cost of their benefits.

 Increase the amount employees pay for benefits.

 Cut the health care plans provided to retirees.

b. Containing Medical Benefits Costs

 Growth in health care costs results from overuse of costly services by consumers.

 Firms added health savings accounts and high-deductible health insurance plans.

o A high-deductible health insurance plan (HDHP): a medical insurance plan with high deductibles but lower premiums and a spending account to which employers contribute funds employees keep if they leave the organization.

o HDHPs are called consumer-driven plans

d

o Health maintenance organizations (HMOs): organizations of physicians and health care professionals that provide a wide range of services to subscribers and dependents on a prepaid basis.

o Employees use a primary-care physician.

o A preferred provider organization (PPO): a network of physicians who establish an organization that guarantees lower health care costs to employers and their employees.

o Employers s couple PPOs and HMOs with different types of tax-advantaged accounts employees can use to pay out-of-pocket expenses.

o A health reimbursement account (HRA): allows employees to be reimbursed for out-of-pocket expenses.

o A flexible spending account (FSA): a type of account employees use for health-related expenses.

c. Containing Dental, Optical, and Mental Health Benefits Costs

 Dental plans: help pay for dental care costs and encourage employees to receive regular dental attention.

 Optical benefits cover the costs of an optometrist’s visit and the cost of contact lenses and glasses.

 Almost all workers with health coverage receive mental health benefits.

. Containing Additional Costs Figure 11.2

 The aging U.S. population and high obesity rates cause health care costs to rise.

 Companies offer lower health care premiums for employees who adopt healthy habits and activities.

 Some companies waive deductibles and copays for medical tourism. (Optional) Knowledge Check: <5 minutes total Use Figure 11.2 to discuss costs of medical care in different countries. Ask students to evaluate the value of medical tourism.

e. Value-Based Health Initiatives: enable employers to target benefits and health programs at the medical care employees most use and need.

f. Wellness programs: programs designed to encourage employees to maintain and improve their health through checkups, eating properly, exercising, and managing stress to prevent costly and protracted illnesses.

g. Disease management programs: provide patients and their caregivers with information on monitoring and treating medical conditions, while coordinating communication between them, health care providers, employers, and insurers.

i. Employee assistance programs: services provided by employers to help workers cope with problems that interfere with job performance.

 The intent is to help employees solve personal problems or prevent problems from becoming crises that affect work.

j. Mental health: counseling services are provided to employees as an important part of an EAP.

Instructor Manual: Snell/Morris, Managing Human Resources 19e, c23, ISBN: 9780357716519; Chapter #1: The Opportunities and Challenges of Human Resources Management

 Following the COVID-19 pandemic, the focus on mental health increased. When the pandemic hit in 2020, 62 percent of employees were more stressed than in their entire careers.

EOC (Optional) Discussion Question #1: 5 minutes total.

Discussion Activity 4

Many organizations are concerned about the rising cost of employee benefits and question their value to the organization and to the employees. In your opinion, what benefits are of greatest value to employees? To the organization? Why?

CO 11.2: Summarize the employee benefits required by U.S. law.

11.2. Employee Benefits Required by Law

l. Legally required employee benefits constitute 19 percent of the benefits package that employers provide.

11.2A. Social Security Insurance

l. Old Age, Survivors, and Disability Insurance (OASDI) protects workers against lost earnings resulting from old age, unemployment, and disability.

ll. It covers 96 percent of the American workforce.

lll. It is supported by a tax levied against an employee’s earnings matched by the employer.

lV. Tax revenues are used to pay for retirement disability, and survivors’ benefits.

a, Retirement Benefits

 To qualify for retirement benefits, a person retirement age and fully insured by earning 40 credits, based on annual earnings.

 Full retirement age depends on the worker’s year of birth.

 The age to collect full benefits has been gradually raised to age 67.

b. Disability Benefits under Social Security: benefits to people who cannot work because of a a medical condition expected to last at least a year or result in death.

c Survivor’s Benefits: paid to a deceased person’s family if eligibility requirements are met.

d. Medicare

 The Social Security Administration administers Medicare, funded by a separate payroll tax.

 The program helps with the cost of health care.

 It is paid by employees and matched by employers.

11.2B. Unemployment Insurance

l. A national program administered by the U.S. Department of Labor under the Social Security Act and coordinated with the states to protect workers who lose their jobs through no fault of their own.

ll. Employers pay for this benefit via a payroll tax.

lll. Rates paid depend upon layoff records.

lV. The amount of compensation workers receive, varies by state and is determined by previous wage rates and length of employment.

11.2C. Workers’ compensation insurance: state-mandated insurance provided to workers to defray the loss of income and cost of treatment due to work-related injuries or illness.

l. Employers in all states pay workers’ comp insurance through payroll taxes, but the amount varies.

11.2D. COBRA Insurance

l. The Consolidated Omnibus Budget Reconciliation Act mandates that employers make health care coverage available on termination of employment, death, or divorce for 18 to 36 months.

11.2E. Benefits Provided by the Patient Protection and Affordable Care Act

l. The Patient Protection and Affordable Care Act (PPACA) and the Health Care and Education Reconciliation Act of 2010 went into effect in 2014.

 In 2021, President Joe Biden strengthened the PPACA by increasing the subsidy amounts to help consumers purchase health insurance and widen the range of people eligible to receive the subsidies.

11.2F. Benefits Provided under the Family and Medical Leave Act

l. The Family and Medical Leave Act (FMLA) applies to employers having 50 or more employees during 20 or more calendar workweeks in the current or preceding year.

ll. A covered employer must grant an eligible employee up to 12 workweeks of unpaid leave in a 12-month period.

lll. Some states provide rights to employees that are greater than those provided by the FMLA.

EOC (Optional) Discussion Question #2: 5 minutes total.

Discussion Activity 2

Employers are required by law to provide specific benefits to employees. What laws mandate benefits to employees, and what are the provisions of those laws?

CO 11.3: Describe the types of work-life benefits, retirement programs, and pension plans as well as the regulations related to them.

11.3 Work-Life Discretionary Benefits

l. Employees are more engaged and satisfied with their job when they have the right work-life balance.

 Zoom, the video conferencing company whose value shot up more than 300 percent during the COVID-19 pandemic, provides a generous time-off policy

11.3A Child and Elder Care

l. Elder care: provided to an elderly relative by an employee who remains actively at work.

ll. A backup care program: an employer provides or subsidizes temporary care for elders or children when regular arrangements fall through.

11.3B. Payment for Time

Not Worked

l. The United States is the only country that does not require paid time off.

a Vacations with Pay: not required in the United States, but most companies offer it.

b. Paid Holidays Figure 11.3

 The federal government recognizes 10 legal public holidays.

 Private employers are not required to give employees these days off or pay employees for the days off.

(Optional) Knowledge Check: <5 minutes total

Use Figure 11.3 to discuss federally recognized holidays

c. Sick Leave

 Most public employees and many in private firms receive sick days each year.

 A source of income when benefits have been exhausted.

d. Sabbaticals: paid (or unpaid) time off for 4 or more weeks that employees use to renew themselves

e. Severance pay: a one-time payment sometimes given to an employee who is being involuntarily terminated.

 Reasons for termination can include: downsizing, job elimination, voluntary separation programs, or refusal of a reassignment or relocation.

f. Supplemental unemployment benefits (SUB): a laid-off employee draws benefits from an employer, who uses a fund created for this purpose, in addition to state unemployment compensation.

11.3C. Life Insurance: provides death and may provide accidental death and dismemberment benefits.

11.3D. Long-Term Care Insurance: pays for nursing home and other medical-related costs during old age

l. It can be a strategic benefit to attract and retain employees.

11.3E. Other Benefits and Services

Figure 11.4

a. Credit Unions: serve the financial needs of employees and attract potential employees

b. Educational Assistance: also called tuition aid, a strategic business tool to support and develop leadership.

(Optional) Knowledge Check: <5 minutes total

Use Figure 11.4 to discuss additional benefits that organizations offer to employees.

c. Retirement Programs: For most professions, there is no mandatory retirement age

d. Preretirement and Phased Retirement Programs: Employers offer preretirement planning seminars and workshops.

 Phased retirement: allows employees to gradually cut hours before retiring.

11.3F. Pension Plans: reward employees with income after retirement.

a. Types of Pension Plans: categorized according to contributions made by the

employer and) according to the amount of pension benefits to be paid.

 A contributory plan is a pension plan in which contributions are made jointly by employees and employers.

 A noncontributory plan: contributions are made solely by the employer.

 A defined benefit plan: the amount an employee is to receive on retirement is specifically set forth.

 A defined contribution plan: establishes the basis on which an employer will contribute to the pension fund.

b. 401(k) Savings Plans

 allows employees to save through payroll deductions that reduce their taxable income and have their contributions matched by the employer.

 It guarantees nothing.

 The return depends on how much money goes into the plan, the rate of return on the investments, and, with stock-funded plans, the stock price.

c. Cash Balance Pension Plans

 The employer makes a yearly contribution, based on a percentage of the employee’s pay, into an employee’s retirement savings account.

d. Federal Regulation of Pension Plans

 Private pension plans are subject to federal regulation, including vesting rules, under ERISA.

o Vesting is a guarantee of accrued pension benefits to participants at retirement age, regardless of their employment status at that time.

o The Employee Retirement Income Security Act requires minimum funding standards be followed to ensure pension benefits will be available to employees when they retire.

o It also created the Pension Benefit Guaranty Corporation (PBGC), a federal government agency that ensures that if a plan is terminated, guaranteed minimum benefits are paid to participants.

(Optional) Knowledge Check: <5 minutes total

List the advantages and disadvantages of 401(k) pension plans.

Advantages of 401(k) pension plans are that (1) employees save through payroll deductions that reduce their taxable income, (2) employers match employee contributions at 25 to 50 cents for every worker dollar contributed, and (3) they cost a company less than pension funds. The major disadvantage of 401(k) plans is that they guarantee employees nothing if it loses money

11.3G. Domestic Partner Benefits

l. Employers grant benefits to employees who establish domestic partnerships.

ll. An Affidavit of Domestic Partnership typically has the following conditions:

 A minimum age requirement

 A requirement that the couple live together

 A specification of financial interdependence

 A requirement that the relationship be a permanent one lll. A requirement that each not be a blood relative EOC (Optional) Discussion Question #3: 5 minutes total.

Discussion Activity 2

Working in teams of 3 or 4, assume your team was hired as a benefits consultant to a small business having 50 to 60 employees. What benefits do you believe this employer should offer, given limited resources?

Justify your reasons for offering these benefits.

Discussion Questions

1. Question: Many organizations are concerned about the rising cost of employee benefits and question their value to the organization and to the employees. In your opinion, what benefits are of greatest value to employees? To the organization? Why?

Suggested answer: This question is designed to stimulate discussion about benefits and their value to the organization and its employees. Suggestions will vary. Things to be considered when designing a strategic benefits plan for a small employer would include many of the same things that would apply to larger firms. Among the considerations are the relative preference shown for each benefit by managers and employees, the estimated cost of each benefit, the total amount of money available for the entire benefits package, and how it compares to the competition. Depending on how small the employer might be, the outcome of analyzing these considerations and the resulting alternatives could be discussed with the employees to get their inputs regarding their preferences.

2. Question: Employers are required by law to provide specific benefits to employees. What laws mandate benefits to employees, and what are the provisions of those laws?

Suggested answer: The following laws are directly related to employee benefits:

 Employee Retirement Income Security Act (ERISA) requires employers to inform employees about their pension program.

 Consolidated Omnibus Budget Reconciliation Act (COBRA) requires employers to make health coverage available to employees, their spouses, and their dependents upon termination of employment, death, or divorce.

 Social Security Act a federally managed insurance plan designed to protect covered individuals against loss of earnings resulting from various causes. Provides unemployment insurance due to loss of employment.

 Workers’ Compensation Insurance insurance provided to workers to defray the loss of income and cost of treatment due to work-related injuries or illness.

 The Family and Medical Leave Act provides mandatory leaves to covered individuals for reasons related to certain family and medical conditions

3. Question: Working in teams of 3 or 4, assume your team was hired as a benefits consultant to a small business having 50 to 60 employees. What benefits do you believe this employer should offer, given limited resources? Justify your reasons for offering these benefits considering the advantages and disadvantages.

Suggested answer: This discussion question was included to foster a group Discussion on employee benefits. After teams have formulated their answers, have each team select a spokesperson to report the team’s findings.

Additional Discussion Questions

The following are discussion questions that do not appear in the text, PPTs, or courseware (if courseware exists) – they are for you to use as you wish. You can assign these questions several ways: in a discussion forum in your LMS; as whole-class discussions in person; online.

4. Question: Mayor Bill de Blasio of New York City attempted to pass a bill requiring two weeks paid vacation for all employees, but its failure makes the United States still the only advanced economy that does not offer paid time off. Should employees receive paid vacation time?

Suggested answer: Students can debate this question. Despite the fact that vacation pay is not required in the United States, most employers generally agree that vacations are essential to the well-being of an employee. Research shows that workers who use their vacation time are more productive and less prone to job-related burnout. Exactly how much paid vacation time firms provide their employees varies by a firm‘s industry, locale, size, and other factors. Employees in the United States who work for large companies often get 10 paid days of vacation a year. To qualify for longer vacations of 3, 4, or 5 weeks, one may expect to work for 7, 15, and 20 years, respectively

Additional Activity

The following are activities and assignments developed by Cengage but not included in the text, PPTs, or courseware (if courseware exists) – they are for you to use if you wish. Invite a Human Resources manager from a local business to speak to the class in-person or over Zoom about the benefit plan offered to the firm‘s employees. Students can prepare questions about the benefits in advance.

Case Study 1: Adobe’s Family-Friendly Benefits: An Unexpected Backlash

1. Question: Do managers like Janis Blancero face a more complicated decision when evaluating the personal requests of employees versus evaluating employees’ individual work performance? Explain.

Suggested answer: Students‘ answers will vary. Managers often remark that evaluating and granting/denying the personal requests of employees is a more difficult decision to

make than evaluating the work performance of employees. When evaluating an employee‘s work performance, managers often have standards, goals, or benchmarks against which performance can be measured. There is often an objective standard known to employees by which all employees are judged. With the personal requests of employees it is more like comparing apples to oranges. How does a manager make a value judgment about what is more important to one employee compared to another? Or, is one employee‘s ―needs‖ greater than another‘s? For example, in this case Blancero must evaluate the importance of Teresa‘s parenting needs, Dorothy‘s request for time off for personal reasons, and Juan‘s request for a flexible schedule in order to reach a personal achievement goal. These requests involve value judgments that are often difficult to balance and resolve.

2. Question: (a) Should Adobe establish a policy for granting flexible work schedules? Explain. (b) If you answered yes, what might that policy contain?

Suggested answer: a. Experience indicates that employees can present a myriad of reasons often very creative ones to justify their need for a flexible work hours schedule. Because of the type of problem presented in this case, organizations need to develop a policy for granting special work hours schedules. b. While no company policy can cover all of the situations that are likely to arise, at a minimum the policy should cover the following points:

 Identify the need for the request

 Access the justification for the request

 Ascertain how the employee’s work will be completed during the off periods

 Consider hours the employee proposes to work

 Identify a coverage plan in case any emergency situations arise

3. Question: If you were Janis Blancero, how would you resolve this dilemma? Explain.

Suggested answer: Students‘ answers will vary. Janis must maintain the performance of her department while attempting to balance the professional and personal lives of her employees. Janis needs to determine exactly how many account managers she requires to cover the work. Once the work is covered, Janis can evaluate the merits of the various needs of her employees. This is exactly why employees are requested to document and justify the reasons for their personal time-off requests. In this case, if only one employee can be given time off, then Janis should grant the benefit to the employee making the most compelling reason for the reduced or rearranged work hours.

Another consideration that Janis must factor into her decision is the value of the employee. Employee benefits, like pay, are part of the total compensation package and, therefore, can be given as rewards to employees with superior or above average performance or to employees who make strategic contributions to the organization. Janis must evaluate the value of employees in her department which is clearly her obligation and reward them accordingly. Employers have long engaged in differential employment practices, but they have traditionally done so to encourage or reward merit or seniority.

While those employees whose requests have been denied may not agree with Janis‘s decision, she needs to explain her decision to each employee in a private one-on-one

conversation. Employees are entitled to know why their personal requests are accepted or denied.

As an alternative to making a decision entirely by herself, it may be advisable for Janis to bring Teresa, Juan, and Dorothy together to see if they can think of a creative way to achieve flexibility among all of their personal time-off requests

Case Study 2: Evaluating the Work-Life Climate in Your Company

1. Question: What is the quality of the work-life environment in your company? The following survey provided by the Work and Family Connection will help provide a ―case analysis‖ of the climate in your organization. Answers to the 20 questions will provide clear insights about your company’s position in the work-life area.

Agree or Disagree with the Following Statements

1. My manager or supervisor treats my work-life needs with sensitivity.

2. It is usually easy for me to manage the demands of both work and home life.

3. My career path at this company is limited because of the pressure of home life demands.

4. My job at this company keeps me from maintaining the quality of life I want.

5. My manager or supervisor is supportive when home life issues interfere with work.

6. My manager or supervisor focuses on results, rather than the time I am at my desk.

7. My manager or supervisor has a good understanding of flexible work hour practices.

8. If I requested a flexible work arrangement, my manager or supervisor would support me.

9. My manager or supervisor is often inflexible or insensitive about my personal needs.

10. I believe my manager or supervisor treats me with respect.

11. My manager or supervisor allows me informal flexibility as long as I get the job done.

12. My manager or supervisor tends to treat us like children.

13. My manager or supervisor seldom gives me praise or recognition for the work I do.

14. My manager or supervisor seems to care about me as a person.

15. I would recommend this company to others.

16. The work I do is not all that important to this company’s success.

17. If I could find another job with better pay, I would leave this organization.

18. If I could find another job where I would be treated with respect, I would take it.

19. If I could find another job where I could have more flexibility, I would take it.

20. I am totally committed to this company.

For a perfect score, you should answer ―Disagree‖ to questions 3, 4, 9, 12, 13, 16, 17, 18, and 19 and ―Agree‖ to all the rest, 1, 2, 5, 6, 7, 8, 10, 11, 14, 15, and 20.

To score, begin by giving yourself 20 points. Then deduct one point for every ―wrong‖ response from the total score.

Instructor Manual: Snell/Morris, Managing Human Resources 19e, c23, ISBN: 9780357716519; Chapter #1: The Opportunities and Challenges of Human Resources Management

If your score is 18 to 20: Congratulations! Your organization is leading the nation in flexibility and supportiveness.

If your score is 14 to 17: Your organization is probably more supportive and flexible than most, but you have room to grow.

If your score is 11 to 13: You could be open to other job offers in the race for talent.

If your score is 10 or less: Your managers will need help to manage the adapting and farreaching twenty-first-century workforce.

Suggested answer: After students have completed the questionnaire, have them discuss their finding in a class discussion. Have students describe programs their employers have which facilitate a work/life climate. Students‘ answers will vary.

Additional Resources

Cengage Video Resources

 MindTap Videos:

o Chapter 11: Concept Clip: Retirement Programs

o Chapter 11: On The Job: Stew Leonard's- Benefits

Chapter 12: Promoting Safety and Health

Instructor Manual

Snell/Morris, Managing Human Resources 19e, c23, ISBN: 9780357716519; Chapter #12: Promoting Safety and Health

Table of Contents

Purpose and Perspective of the Chapter 167

Chapter Objectives 167

Key Terms 167

What's New in This Chapter 168

Chapter Outline 168

Discussion Questions 10

Additional Discussion Questions 175

Additional Activities and Assignments Error! Bookmark not defined.

Case Study 1: Deadpool Ends in Death

Case Study 2: Too Much Fatigue and Stress? You Decide

Additional Resources 178

11

12

Purpose and Perspective of the Chapter

Close to 90 percent of all companies in the United States use some form of health and safety program. Safety programs are plans of action to prevent accidents or occupational diseases. Health and safety programs are plans of action to encourage the health and wellness of employees. They ensure that employees can continue to work, which lowers costs for the company. However, current research shows that health programs not only save the company money through fewer sick days, workers‘ compensation, disability payments, and replacing employees who are injured or killed, but these programs also increase employee productivity. ―When you give people the tools and the opportunity to be physically and mentally healthier, it‘s not just that they‘re more likely to be at work,‖ said Lamar Pierce, professor at Washington University. ―Those employees are also more likely to be productive.‖

Chapter Objectives

The following objectives are addressed in this chapter:

1. Summarize the general provisions of the Occupational Safety and Health Act (OSHA).

2. Describe the measures managers and employees can take to create a safe work environment.

3. Describe the programs organizations utilize to build better health among their workforces.

Key Terms

Burnout: A severe stage of distress, manifesting itself in depression, frustration, and loss of productivity.

Cumulative trauma disorders: Injuries involving tendons of the fingers, hands, and arms that become inflamed from repeated stresses and strains.

Depression: A negative emotional state marked by feelings of low spirits, gloominess, sadness, and loss of pleasure in ordinary activities.

Distress: Harmful stress characterized by a loss of feelings of security and adequacy.

Emergency action plans: A plan an organization develops that contains step-by-step procedures for dealing with various emergency situations.

Eustress: Positive stress that accompanies achievement and exhilaration.

Fitness-for-duty evaluations: Evaluations randomly conducted to determine an employee‘s physical, mental, and emotional fitness for a job.

Material Safety Data Sheets (MSDSs): Documents that contain vital information about hazardous substances.

Recordable case: Any occupational death, illness, or injury to be recorded in the log (OSHA Form 300).

Right-to-know laws: Laws that require employers to advise employees about the hazardous chemicals they handle.

Stress: Any adjustive demand caused by physical, mental, or emotional factors that requires coping behavior.

What's New in This Chapter

The following elements are improvements in this chapter from the previous edition:

Chapter # New component(s)

Chapter 12

Chapter 12

● Update research on preventing employee burnout.

● Updated information on U.S. employee injury and safety statistics today.

Chapter 12 ● New research on the proven success of computer game safety training.

Chapter 12 ● Updated information on enforcing safety rules and the importance of crisis management teams.

Chapter 12 ● Updated information on the prevalence of workplace violence.

Chapter Outline

The following outline organizes activities (including any existing discussion questions in PowerPoints or other supplements) and assessments by chapter (and therefore by topic), so that you can see how all the content relates to the topics covered in the text.

(Optional) Knowledge Check: <5 minutes total

An ergonomically designed computer workstation will reduce the strain on the worker‘s eyes, neck and shoulders, wrists, and back. Ergonomics has proven cost effective at organizations such as Compaq Computer, 3M, Pratt and Whitney, and the U.S. Postal Service. What are some other benefits that ergonomics offers to both employers and employees?

Teaching Tip: Benefits listed may include: increased productivity, lower absenteeism (due to improved health, and improved morale

CO 12.1: Summarize the general provisions of the Occupational Safety and Health Act (OSHA).

12.1. Safety and Health: It’s the Law

Figure 12.1, Figure 12.2, Figure 12.3

l. The mission of OSHA: ―assure the safety and health of America’s workers by setting and enforcing standards: providing training, outreach, and education; establishing partnerships; and encouraging continual improvements in workplace safety and health.‖

(Optional) Knowledge Check: <5 minutes total

Use Figures 12.1-12.3 to discuss OSHA’s mission and the expense of worker injury and death

12.1A. OSHA’s Coverage: all private sector employees and public employees in state and local government.

12.1B. OSHA Standards: developing and enforcing mandatory job safety and health standards.

l. Employers need to become familiar with the standards that apply to their businesses.

ll. Employers can be cited and fined if they do not comply with OSHA standards.

lll. OSHA can begin standards-setting procedures on its own initiative or if requested by other parties. Figure

12.4

(Optional) Knowledge Check: <5 minutes total Use Figure 12.4 to discuss how OSHA standards are set and who can request that standards be set.

12.1C. Enforcing OSHA Standards Figure 12.5

l. OSHA is authorized to: conduct workplace inspections, issue citations, and impose penalties on employers.

(Optional) Knowledge Check: <5 minutes total Use Figure 12.5 to discuss the most frequently violated OSHA standards. Ask students to consider how each of these categories can be a danger to American workers

a Workplace Inspections: An OSHA compliance officer is authorized to enter without delay and to inspect and investigate any place of employment.

b. Citations and Penalties: may be issued immediately after an inspection or mailed to the employer

 A citation identifies which regulations and standards were violated and how long the employer has to correct the situation.

 OSHA may cite the following violations:

o Other-Than-Serious: This violation has a direct relationship to job safety and health but not likely to cause death or serious physical harm.

o Serious: This violation has a substantial probability that death or serious physical harm could result and the employer knew, or should have known, of the hazard.

o Willful: This violation was committed intentionally and knowingly or this violation was committed with indifference to the law.

 Penalties can be: $250,000 for an individual, $500,000 for a corporation, or imprisonment of up to 6 months, or both.

12.1D. OSHA Consultation Assistance: employers develop and implement effective workplace safety and health programs

a. On-site Consultation: helps employers identify hazardous conditions and determine corrective measures.

Figure 12.6

• OSHA provides free training and education services.

b. Cooperative Programs: Employers, employees, unions, and OSHA form a cooperative relationship:

 alliances

 strategic partnership programs (SPPs)

 voluntary protection programs (VPPs)

 safety and health achievement recognition programs (SHARP).

(Optional) Knowledge Check: <5 minutes total

Use Figure 12.6 to discuss the four cooperative programs. Ask students to define the differences in the programs.

12.1E. Responsibilities and Rights under OSHA: employers and employees have responsibilities and rights

a. Employers’ Responsibilities and Rights:

 Provide a hazard-free workplace and comply with the applicable standards.

 Inform all employees about the safety and health requirements of OSHA.

 Keep certain records and compile and post an annual summary of work-related injuries and illnesses.

 Provide employees with protective equipment when necessary and ensure that it is used.

 Provide workers with safety training and be prepared to discipline employees who do not follow the safety rules.

 Refrain from discriminating against employees who file complaints with OSHA.

b. Employees’ Responsibilities and Rights:

 Comply with all applicable OSHA standards.

 Report hazardous conditions.

 Follow all employer safety and health rules and regulations.

c. Right-to-know laws: require employers to advise employees about the hazardous chemicals they handle.

EOC (Optional) Discussion Question #1: 5 minutes total.

Discussion Activity

When OSHA was enacted in 1970, it was heralded as the most important new source of protection for the U.S. worker in the second half of the twentieth century. From the information in this chapter, what is your opinion about the effectiveness or the ineffectiveness of the act? Should it be expanded?

CO 12.2: Describe the measures managers and employees can take to create a safe work environment.

12.2. Promoting a Safe Work Environment

The HR department or the industrial relations department is responsible for a safety program. The HR department has the following responsibilities:

 Coordinate the safety communication and training programs.

 Maintain safety records required by OSHA.

 Work closely with managers and supervisors to make the program a success.

12.2A. Creating a Culture of Safety: Everyone consciously works to improve safety and health conditions.

Figure 12.7

l. HR executives should be the point persons on creating and making sure that a corporate safety culture exists.

ll. During the COVID-19 vaccination rollout, many companies were deciding whether to mandate vaccinations for their employees.

lll. Fitness-for-duty evaluations: randomly conducted to determine an employee’s physical, mental, and emotional fitness for a job.

(Optional) Knowledge Check: <5 minutes total

Use Figure 12.7 to discuss the effect a manager has in a culture of safety

a. The Key Role of the Supervisor: responsibility to communicate to an employee the need to work safely.

 Supervisors: observe employees, reinforce safe practices, correct unsafe behaviors.

b. Proactive Safety Training Programs: In some industries, training is legally required

 When training is mandated, employers must keep accurate records of employee education.

 The use of games has also become an interactive way to provide employees with safety training.

 Involving employees in designing and implementing safety programs makes it likely that employees will embrace safety training.

12.2B. Enforcing Safety Rules: Firms communicate rules and regulations through:

 supervisors

 bulletin board notices

 employee handbooks

 signs attached to equipment .

12.2C. Investigating and Recording Accidents

Figure 12.8

l. The supervisor and a member of the safety committee should investigate every accident.

ll. A recordable case: any occupational death, illness, or injury to be recorded in the log (OSHA Form 300).

Instructor

12.2D. Safety Hazards and Issues: Workplace hazards differ per occupation.

a. Fatigue

 Fatigue is more of a problem in organizations that operate around the clock or have night shifts.

 OSHA currently has no fatigue standard.

b. Distracted Driving: car crashes are the leading cause of fatalities each year.

 Although OSHA does not have regulations on distracted driving, companies are establishing their own policies.

c. Workplace Violence

 The NIOSH defines workplace violence as ―any physical assault, threatening behavior, or verbal abuse occurring in the work setting.‖

 Workplace violence includes bullying.

 OSHA recommends background checks on job applicants to check for a history of violence.

d. Reducing Workplace Violence

Figure 12.9

• OSHA recommends firms analyze their workplaces to uncover areas of potential violence

• OSHA recommends firms develop violence prevention programs and training for their employees.

(Optional) Knowledge Check: <5 minutes total

Use Figure 12.9 to discuss warning signs of violence. Ask students who should be responsible for noticing these warning signs and what should be done if the signs are detected.

e Workplace Emergencies

 A workplace emergency is an unforeseen situation that threatens employees, customers, or the public; disrupts or shuts down operations; or causes physical or environmental damage.

 An emergency action plan is a plan an organization develops that contains step-bystep procedures for dealing with various emergency situations.

EOC (Optional) Discussion Question #2: 5 minutes total.

Discussion Activity

What steps should management take to increase the motivation of their employees to operate safely?

f. Crisis Management Teams Figure 12.10

 Hourly and managerial employees, work with HR to: conduct initial risk assessment surveys, develop emergency action plans, test them, and perform crisis intervention.

(Optional) Knowledge Check: <5 minutes total

Use Figure 12.10 to discuss what members of a crisis team could do to calm an angry employee. Ask students to identify people or characteristics that would be useful in a crisis team.

CO 12.3: Describe the programs organizations utilize to build better health among

their workforces.

EOC (Optional) Discussion Question #4: 5 minutes total.

Figure 12.11

Discussion Activity

What are the benefits of computer game training programs? Answer: The use of games has become an interactive way to provide employees with safety training. Costco and Amazon have successfully used a product called Safety Bingo to motivate employees to create a safetyconscious atmosphere and remind them of their safety goals. A study published in 2021, tested the effectiveness of traditional instructional safety training against the increasingly popular computer game training.

12.3. Creating a Healthy Work Environment: The effects of health hazards become evident over time.

12.3A. Ergonomics: a cost-effective way to help eliminate health hazards in the workplace. (Optional) Knowledge Check: <5 minutes total Use Figure 12.11 to discuss elements in a successful ergonomics program.

Ask students to describe ergonomic solutions that they have seen or experienced

12.3B. Health Hazards and Issues: Health hazards are no longer found only in manufacturing operations.

a. Cumulative Trauma Disorders: injuries involving fingers, hands, and arms that become inflamed from repeated stress

 Carpal tunnel syndrome is a common condition.

 Ergonomics improve or correct workplace characteristics that cause or aggravate cumulative trauma disorders.

b. Computer Workstation Issues: Video and computer screens are a concern

 Problems caused by computer usage include: visual difficulties, muscular aches and pains, and job stress. Figure 12.12 (Optional) Knowledge Check: <5 minutes total Use Figure 12.12 to discuss computer workstation ergonomics. Ask students why it is necessary to have ergonomic equipment when working on a computer screen for long periods of time.

c. Chemical Hazards

 The purpose of OSHA’s hazard communication standard is to ensure the testing and evaluation of chemicals by producers and the distribution of information to users.

 Material Safety Data Sheets (MSDSs) are documents that contain vital information about hazardous substances.

d. Smoking and Tobacco Smoke

 Most organizations have a smoking policy that specifies where smoking is allowed

e. Pathogens: Exposure to blood can leave employees vulnerable to contracting diseases.

• The COVID-19 pandemic has increased public awareness of pathogens, including the need for masks while working where dangers may lurk.

12.3C. Building Better Physical and Emotional Health among Employees

l. EAPs can help workers solve many types of problems.

a. Wellness and Weight Issues:

 Excess weight can affect a worker’s health and productivity.

 Nutritional programs address two lifestyle changes:

o increasing physical exercise

o adopting nutritional dietary programs.

b. Job Stress and Burnout Figure 12.13

 Stress is any adjustive demand caused by physical, mental, or emotional factors that requires coping behavior.

 Two terms are used to discuss positive and negative stress: eustress and distress.

o Eustress is positive stress that accompanies achievement and exhilaration.

o Distress is harmful stress characterized by a loss of feelings of security and adequacy.

o Burnout is a severe stage of distress, manifesting itself in depression, frustration, and loss of productivity.

 Four factors influence employee stress:

o high demand

o high effort

o low control

o low reward.

Figure 12.13, Figure 12.14

(Optional) Knowledge Check: <5 minutes total Use Figure 12.14 to discuss ways to reduce job-related stress

c. Depression: a negative emotional state marked by feelings of low spirits, gloominess, sadness, and loss of pleasure in ordinary activities

d. Alcoholism: a disease that affects men and women, both young and old

 Under the ADA, employers can discipline or discharge employees when job performance is so badly affected by alcohol usage that the employee is unable to perform the job.

e. Drug Abuse: illegal drugs costs billions of dollars annually.

• The ADA considers an individual with a serious, life-affecting drug problem to be disabled.

EOC (Optional) Discussion Question #3: 5 minutes total.

Discussion Activity

To live a healthier life, medical professionals say we need to identify those

things we currently do that either impair or contribute to our health. Discuss with others a way to develop a lifetime program for a healthy lifestyle.

Discussion Questions

1. Question: When OSHA was enacted in 1970, it was heralded as the most important new source of protection for the U.S. worker in the second half of the twentieth century. From the information in this chapter, what is your opinion about the effectiveness or the ineffectiveness of the act? Should it be expanded, or should businesses have more freedom to determine safety standards for their workers?

Suggested answer: Students‘ answers will vary. Some of the students will have heard employee and/or employer comments about OSHA. Opinions of employees will generally be favorable, although some employees may feel that some of the provisions of OSHA have made their jobs more difficult to perform. Some employers resent the costs of complying with OSHA and the presence of inspectors in their facilities.

2 Question: What steps should management take to increase the motivation of their employees to operate safely?

Suggested answer: HR professionals and safety directors advocate employee involvement when designing and implementing safety programs. Employees are more likely to embrace safety training when they feel a sense of ownership in the instructional program.

3. Question: To live a healthier life, medical professionals say we need to identify those things we currently do that either impair or contribute to our health. Discuss with others a way to develop a lifetime program for a healthy lifestyle.

Suggested answer: Students’ answers may vary. Both employers and employees should honor their mind and body as a whole. They could start an exercise program, tailored to their needs and goals. Organizations can make use of ergonomics. They can continuously develop their office furniture, video display terminals, tool design, computer keyboards, and workstations.

Additional Discussion Questions

The following are discussion questions that do not appear in the text, PPTs, or courseware (if courseware exists) – they are for you to use as you wish. You can assign these questions several ways: in a discussion forum in your LMS; as whole-class discussions in person; or as a partner or group activity in class.

4. Question: What are the benefits of computer game training programs?

Suggested answer: The use of games has become an interactive way to provide employees with safety training. Costco and Amazon have successfully used a product called Safety Bingo to motivate employees to create a safety-conscious atmosphere and remind them of their safety goals. A study published in 2021, tested the effectiveness of traditional instructional safety training against the increasingly popular computer game training. The traditional methods hold three limitations: (1) representation of the workplace situation, (2) accessibility for workers who have low literacy, and (3) maintaining the workers‘ attention. The study showed that the computer game overcame these limitations while providing the employees with a greater knowledge of the safety procedures.

Additional Activities and Assignments

The following are activities and assignments developed by Cengage but not included in the text, PPTs, or courseware (if courseware exists) – they are for you to use if you wish.

Crisis Management Teams Some organizations have formed crisis management teams, and during the COVID-19 pandemic, many organizations found that such teams would have been helpful if they had already been in place before the crisis. Crisis management teams and HR managers play a key role when it comes to getting employees back to work and paid on time following an emergency. Crisis management teams are also responsible for disseminating public information and addressing the press.

In small groups in class or over Zoom, design a crisis management program with a crisis management team for an organization of your choice. Present your results to the class.

Case Study 1: Deadpool Ends in Death

1. Question: What are some violence indicators an employee might display?

Suggested answer: Answers will vary. See Figure 12.9

 Direct or threatening statements

 Recent performance declines, including concentration problems and excessive excuses

 Insubordination and severe reactions to criticism

 Prominent mood or behavior changes; despondence

 Preoccupation with guns, knives, or other weapons

 Deliberate destruction of workplace equipment; sabotage

 Fascination with stories of violence or war

 Reckless or antisocial behavior; evidence of prior assaultive behavior

 Aggressive behavior or intimidating statements; yelling or using profanity

 Written messages of violent intent; exaggerated perceptions of injustice

 Serious stress, legal, or financial problems in one’s personal life

 Intruding on other people’s privacy by pestering, spying on, or stalking them

 Obsessive desire to harm a specific group or person

 Violence against a family member

 Substance abuse

2. Question : What are some actions management can take to help prevent workplace violence?

Suggested answer: To provide safe working conditions for their employees, employers typically establish a formal safety program in liaison with their HR departments. The program may have many facets, including providing safety knowledge and motivating employees to use it, making employees aware of the need for safety, and rewarding them for safe behavior. Incentives such as praise, public recognition, and awards are used to involve employees in the safety program.

3. Question: How can employees protect themselves against workplace violence?

Suggested answer: Employees can take action against bullying. a form of violence; it is the repeated, health-harming mistreatment of one or more persons by one or more other people. Workplace bullying is pursued under Title VII antidiscrimination laws with only 20 percent of bullying cases directly applying to the antidiscrimination laws. All U.S. states have an antibullying law. OSHA recommends firms analyze their workplaces to uncover areas of potential violence and develop violence prevention programs and training for their employees. Background checks on job applicants should be conducted to ensure they don‘t have histories showing a propensity toward aggression or violence. Remember, employers can be sued for negligent hiring if they do not take this step and workplace injury occurs as a result

Case Study 2: Too Much Fatigue and Stress? You Decide

1. Question: When conflicting medical opinions are presented, should the advice of a medical expert count more heavily than the opinion of a general physician? Explain your answer.

Suggested answer: Often, in medical cases regarding fitness of duty, both parties will submit medical evidence concerning the employee‘s physical condition. It is not uncommon for the employee‘s doctor and the employer‘s doctor to disagree. In cases of this nature, labor arbitrators have been inclined to support the employer if the company doctor acted in ―good faith‖ and the doctor‘s decision was not unreasonable, capricious, or arbitrary. It is argued that company doctors make decisions based on the occupation and industrial setting involved, including risks inherent in the work–factors that may not be known to an outside physician. Therefore, it is generally held that where there is a conflict in the opinions of qualified physicians, whose veracity there is no reason to question, the employer is entitled to rely on the opinion of its own medical advisor. Thus, the opinion of a medical specialist will not necessarily hold over the opinion of a general practitioner. In such cases, it makes sense to ask for a second opinion just to be sure.

2. Question: Is the charge of discrimination presented by Donald’s lawyer relevant to this case? Explain your answer.

Suggested answer: There is no legal basis for a charge of discrimination in this case. While mental disabilities may be more subjective to evaluate and treat, than say a

Instructor Manual: Snell/Morris, Managing Human Resources 19e, c23, ISBN: 9780357716519; Chapter #1: The Opportunities and Challenges of Human Resources Management

physical injury, it does not necessarily mean that Donald was treated with prejudice. While some may disagree with the decision of management, given the facts of the case there is no clear proof of discrimination against Donald. Donald himself will agree that he was indeed treated for a psychological condition that could return because the working conditions have not changed.

3. Question: If you were presented with this case, what decision would you reach? Explain

Suggested answer: Answers to this question may illicit different opinions from students. The employer‘s approach was justified and there is absolutely no indication of discrimination. Donald needs to understand that another mental breakdown could adversely affect his work as well as him. Therefore, he needs to withdraw his case and get back to active duty. The answer to question 1 of this case will be of guidance toward reaching a decision. Having students debate the position of both parties leads to a meaningful class discussion.

Additional Resources

Cengage Video Resources



MindTap Videos:

o Chapter 12: On The Job: Stew Leonard's- Health & Safety

Chapter 13: Employee Rights and Discipline

Instructor Manual

Snell, Human Resources Management, c23, ISBN: 9780357716519ISBN; Chapter #13: Employee Rights and Discipline

Table of Contents

Purpose and Perspective of the Chapter 180

Chapter Objectives 180

Key Terms 180

What's New in This Chapter 4

Chapter Outline 4

Discussion

Questions……………………………………………………………………………………………

12

Additional Discussion Questions 14

Additional Activities and Assignments 15

Case Study 1: Discharged for Off-Duty Behavior………………………………………………………………..15

Purpose and Perspective of the Chapter

In this chapter, we discuss the rights of employees, the privacy they can expect in the workplace, and employee discipline. Companies without clear policies and procedures for dealing with employee rights and discipline can end up losing lots of money and, worst of all, ruining their reputation.

This is where HR managers play a crucial role. To be effective they must stay abreast of current laws, agency regulations, and court rulings, establish written employment policies based on this information, and educate the staff members in their organizations about them.

Chapter Objectives

The following objectives are addressed in this chapter:

1. Explain the concepts of employee rights and employer responsibilities.

2. Differentiate separate sets of disciplinary policies that use the progressive and positive discipline approaches.

3. Identify the different types of alternative dispute resolution methods.

Key Terms

Alternative dispute resolution (ADR): A term applied to different employee complaint or dispute resolution methods that do not involve going to court.

Constructive discharge: An employee‘s voluntary termination of their employment because of harsh, unreasonable employment conditions placed on the individual by the employer.

Discipline: A tool, used to correct and mold the practices of employees to help them perform better so they conform to acceptable standards.

Due process: Procedures that constitute fair treatment, such as allowing an employee to tell their story about an alleged infraction and defend against it.

Employee rights: Guarantees of fair treatment that become rights when they are granted to employees by the courts, legislatures, or employers.

Employment-at-will relationship: The right of an employer to fire an employee without giving a reason and the right of an employee to quit when they choose.

Ethics: A set of standards of conduct and moral judgments that help to determine right and wrong behavior.

Impairment testing: Also called fitness-for-duty or performance-based testing, it measures whether an employee is alert enough to work.

Mediation: The use of an impartial neutral to reach a compromise decision in employment disputes.

Mediator: A third party in an employment dispute who meets with one party and then the other to suggest compromise solutions or to recommend concessions from each side that will lead to an agreement.

Negligence: The failure to provide reasonable care when such failure results in injury to consumers or other employees.

Ombud: A designated individual from whom employees may seek counsel for resolution of their complaints.

Open-door policy: A policy of settling grievances that identifies various levels of management above the immediate supervisor for employee contact.

Peer-review system: A system for reviewing employee complaints that utilizes a group composed of equal numbers of employee representatives and management appointees. The group weighs evidence, considers arguments, and, after deliberation, votes to render a final decision.

Positive or nonpunitive discipline: A system of discipline that focuses on early correction of employee misconduct, with the employee taking total responsibility for correcting the problem.

Progressive discipline: The application of corrective measures by increasing degrees.

Psychological contract: Expectations of a fair exchange of employment obligations between an employee and employer.

Step-review system: A system for reviewing employee complaints and disputes by successively higher levels of management.

Whistle-blowing: Complaints to governmental agencies by employees about their employers‘ illegal or immoral acts or practices.

Wrongful discharge: A discharge, or termination, of an employee that is illegal.

What's New in This Chapter

Chapter # New component(s)

Chapter 13 ● New information on employee privacy rights at their place of employment and at home due to remote work.

Chapter 13 ● New examples related to monitoring off-duty conduct.

Chapter 13 ● Updated information on how employees are protected for blowing the whistle.

Chapter 13 ● New discussions and statistics of social media and how iti is used and abused by employees.

Chapter Outline

The following outline organizes activities (including any existing discussion questions in PowerPoints or other supplements) and assessments by chapter (and therefore by topic), so that you can see how all the content relates to the topics covered in the text

CO 13.1: Explain the concepts of employee rights and employer responsibilities.

13.1 Employee Rights and Privacy

l. Employee rights are guarantees of fair treatment that become rights when they are granted to employees by the courts, legislatures, or employers.

13.1A. Employee Rights versus Employer Responsibilities Figure 13.1

l. The employer has the responsibility to provide a safe workplace while guaranteeing safe, quality goods and services to consumers.

(Optional) Knowledge Check: <5 minutes total

Use Figure 13.1 to discuss conflicts between employee rights and employer rights. Ask students to describe a situation they have seen in which an employee’s rights were violated

13.1B. Negligent Hiring

l. Negligence is the failure to provide reasonable care when such failure results in injury to consumers or other employees.

ll. A general responsibility exists for employers to exercise reasonable care in preventing employees from intentionally harming other employees.

lll. When violence occurs, the employer may face a negligent-hiring lawsuit claiming that the employer should have used more reasonable care in the hiring of its employees.

13.1C. Job Protection Rights

l. A psychological contract is the expectation of a fair exchange of employment obligations between an employee and employer.

a. Employment-at-Will: the right of an employer to fire an employee without giving a reason and the right of an employee to quit when he or she chooses.

 The employment-at-will relationship is created when an employee agrees to work for an employer for an unspecified period of time

 The employment-at-will doctrine does not give employers the unrestricted right to terminate employees.

 Federal and state laws, court decisions, and administrative rulings restrict termination decisions.

 In unionized organizations, union collective bargaining agreements limit automatic discharges.

b. Wrongful Discharge: a discharge, or termination, of an employee that is illegal.

 State courts recognize three exceptions to the employment-at-will doctrine:

o Violation of public policy

o Implied contract

o Implied covenant

Figure 13.2; Figure 13.3 (Optional) Knowledge Check: <5 minutes total Use Figure 13.2 to discuss discharges that violate public policy, and use Figure 13.3 to discuss tips to avoid wrongful employment termination lawsuits. Ask students if anyone they know has ever been wrongfully discharged.

c. Whistle-Blowing: complaints to governmental agencies by employees about their employers’ illegal or immoral acts or practices

 Whistle-blowers are protected by federal and state laws.

 Organizations are penalized for harassing whistle-blowers.

d. Implied Contract

 Under certain conditions employees may be granted contractual employment rights such as the promise of job security.

 To avoid implied contract lawsuits, HR experts recommend the following approaches:

o Training supervisors and managers not to imply contract benefits in conversations with new or present employees.

o Include in employment offers a statement that an employee may voluntarily terminate employment with proper notice and may be dismissed by the employer at any time and for a justified reason.

o Include employment-at-will statements in all employment documents.

o Have written proof that employees have read and understood the employment-at-will disclaimers.

e. Explicit Contracts: formal written signed agreements that grant to employees and employers agreed-upon employment benefits and privileges

 Restrictions can be applied:

o Nondisclosure of information agreement

o Intellectual property agreement

o Noncompete agreement

o Nonpiracy agreement

f. Constructive Discharge: an employee’s voluntary termination of his or her employment because of harsh, unreasonable employment conditions placed on the individual by the employer.

g. Discharge as a Result of Retaliation

• Employers cannot retaliate against employees who exercise their rights, including civil rights, age discrimination, and ADA rights.

• To prevent retaliation charges, employers can:

o Implement a separate anti-retaliation policy and train managers to resolve employee complaints.

o Treat employees with dignity and respect.

o Take no adverse employment action against employees when they file complaints.

o Keep complaints confidential.

o Be consistent and objective in your treatment of employees.

o Harbor no animosity toward employees when they file discrimination lawsuits.

h. Discharges and the WARN Act

• The Worker Adjustment and Retraining Notification (WARN) Act requires organizations with more than 100 employees to give employees and their communities 60 days’ notice of any closure or layoff affecting 50 or more fulltime employees.

13.1D. Privacy Rights: the freedom from unwarranted government or business intrusion into an individual’s personal affairs.

(Optional) Knowledge Check: <5 minutes total

Figure 13.4

Use Figure 13.4 to discuss balancing an employee’s right to privacy versus an employer’s right to monitor an employee.

a. Substance Abuse and Drug Testing

 State and federal regulations restrict drug testing.

Figure 13.5

 Drug testing is most prevalent among employees in sensitive positions within the public sector, in organizations doing business with the federal government, and in transportation companies.

b. Safety-Sensitive Positions -prevalent among employees in the public sector

 The exception is unionized workforces.

c. Criticisms of drug testing include the following:

o Studies have not proven that drug testing makes the workplace safer.

o Alcohol appears to create more problems than drugs.

o Drug tests may be positive long after the drug’s influence has worn off.

d. Impairment Testing: (also called fitness-for-duty or performance-based testing) measures whether an employee is alert enough to work

 Advantages of impairment testing:

o focus on workplace conduct

o ability to identify employees who are impaired for other reasons.

EOC (Optional) Discussion Question #2: 5 minutes total.

Discussion Activity 4

What are the legislative and court restrictions on employer drug testing in both the private and the public sectors?

3.1E. Employee Surveillance Figure 13.6

 Employers use surveillance and other technology to watch employees:

o to prevent employee theft

o monitor quality control

o selling of information

o ensure the safety of employees

o eliminate time wasted.

a. Camera Surveillance

 In general, employers can use camera surveillance on their employees if they have a legitimate business reason and they inform employees.

 States may set their own regulations.

 In many workplaces, employees are not allowed to use cameras without special permission.

 This protects an employer from embarrassing films and photos and protects company secrets.

b. Phone Conversations and Text Communications

 In general, employers have the right to monitor calls, texts, and direct messages sent from their telecommunications devices, provided they have compelling business reasons and employees are informed.

c. Email, Internet, and Computer Use

 Court rulings have limited an employer’s right to monitor email communications their employees send from work computers.

 More companies are banning social media at work.

Instructor Manual: Snell/Morris, Managing Human Resources 19e, c23, ISBN: 9780357716519; Chapter #1: The Opportunities and Challenges of Human Resources Management

 Companies can legally create electronic communication policies that limit employees’ Internet use.

 As the use of Instagram, SnapChat, TikTok and other social media platforms continues to grow, their abuse in the workplace continues to grow as well (Optional) Knowledge Check: <5 minutes total Use Figure 13.6 to discuss the use of social media at work. Ask students about their own use of social media at a job. surveillance, employee monitoring

d. Surveillance of Work from Home

 The COVID-19 pandemic brought about a new era of work from home (WFH or remote work), and a different type of employee surveillance:

o How do employers and supervisors monitor the productivity and work of their employees outside the office?

o Many companies tried systems that would track mouse movement and keyboard usage.

o Some ask that employees stay on camera

o Some believe this is completely legal and reasonable while others say it is an invasion of privacy.

e Searches

 Random searches of employees’ personal belongings without probable cause should be avoided.

 A firm that wants to conduct searches should have a written plan to inform employees of their policies:

o Search policy should be outlined in the employee handbook.

o Searches should be conducted in private.

o The employer should try to obtain the employee’s consent before searching.

o The search should be conducted in a humane and discreet manner.

o The penalty for refusing to consent to a search should be specified.

f. Access to Personnel Files Figure 13.7

 Employers have a wealth of personal information about their employees.

g. HR’s Responsibility to Safeguard Personnel Information.

h. Employee Access to Personnel files.

 Federal legislation and state laws permit employees to inspect their own personnel files.

 Employees have the right to correct inaccurate data in the file

i. Off-Duty Employee

Conduct

 Consider the COVID-19 pandemic and the responsibility employers have in tracking where an employee’s positive COVID-19 test originated.

 Some state laws prohibit employers from disciplining or firing employees for legal activities pursued offsite on their own time.

j. Off-Duty Employee Speech

k

 Some organizations have social networking and blogging policies that restrict employees from making disparaging remarks about the organizations.

 The First Amendment prohibits the government not private employers from telling us what we can and cannot say.

. Workplace Romances can have many bad repercussions.

Figure 13.8

 A consensual relationship between employees can become harassing behavior if one party to the relationship no longer welcomes the conduct.

(Optional) Knowledge Check: <5 minutes total

Use Figure 13.8 to discuss why workplace romance is a bad idea

l. Body Art, Grooming, and Attire

 Employers have the right to establish reasonable standards for grooming, attire, tattoos, and facial piercings, and to require employees

EOC (Optional) Discussion Question #1: 5 minutes total.

Discussion Activity 5

Explain three areas in which employee rights and employer responsibilities could result in conflict. How might this conflict arise?

CO 13.2: Differentiate separate sets of disciplinary policies that use the progressive and positive discipline approaches.

13.2. Disciplinary Policies and Procedures

Figure 13.9; Figure 13.10

l. Discipline is a tool used to correct and mold the practices of employees to help them perform better so they can conform to acceptable standards.

(Optional) Knowledge Check: <5 minutes total

Use Figures 13.9 and 13.10 to discuss the purpose of discipline and common disciplinary problems.

13.2A. The Result of Inaction Figure

13.11

l. Failing to discipline employees can result in more serious problems that must be resolved.

13.B. Setting Organizational Rules

l. Rules are the foundation for an effective disciplinary system.

ll. Adopting and implementing rules should comply with the following guidelines:

 Rules must be reasonable and related to the organization.

 The rules and the consequences for breaking them should be written and distributed to all employees.

 The rules should be clearly explained.

 Employees should sign a document stating that they have read and understood the rules.

 Rules should be reviewed periodically.

13.2C. Investigating a Disciplinary Problem

l. Disciplining an employee should not be done lightly.

(Optional) Knowledge Check: <5 minutes total

Use Figure 13.12 to discuss questions that should be considered during disciplinary investigations. Ask students to describe the purpose of these questions.

a. Documenting Misconduct



b.

Misconduct should be documented to deal with any consequences that may arise such as arbitration hearings and court proceedings.

 Documentation should include the following items:

o The date, time, and location of the incident(s)

o The behavior exhibited by the employee (the problem)

o The consequences of that action or behavior on the employee’s overall work performance and/or the operation of the employee’s work unit

o Prior discussion(s) with the employee about the problem

o The disciplinary action to be taken and the improvements expected should be documented

o The consequences of failing to make the improvements by a certain follow-up date

o The employee’s reaction to the supervisor’s attempt to change his or her behavior

o The names of witnesses to the incident (if applicable)

EOC (Optional) Discussion Question #3: 5 minutes total.

Discussion Activity

Discuss why documentation is so important to the disciplinary process. What constitutes correct documentation?

The Investigative Interview

 Before discipline occurs, an investigative interview should be conducted to confirm that the employee is aware of the rule and knows that the rule was broken.

13.2D. Approaches to Disciplinary Action

l. Two approaches to disciplinary action are available: progressive discipline and positive discipline.

 Progressive discipline: the application of corrective measures by increasing degrees; designed to motivate an employee to correct behavior voluntarily. Includes:

o an oral warning,

o a written warning

o suspension without pay

o discharge. Figure

13.12

 Positive or Nonpunitive Discipline: a system of discipline that focuses on early correction of employee misconduct, with the employee taking total responsibility for correcting the problem. Three steps:

o a conference between the employee and the supervisor to find a solution

o a conference between the employee and the supervisor to determine why the solution did not work

o a one-day decision-making leave.

13.2E. Discharging Employees Figure 13.13

l. A fired employee may file a wrongful discharge suit claiming the termination was ―without just or sufficient cause.‖

ll. The standards governing discharges were developed in labor arbitration.

a Informing the Employee: These guidelines make a discharge meeting more effective:

 Come to the point quickly and list the reasons for the termination in a logical order.

o Be straightforward, firm, tactful, and resolute.

o Make the discussion private, businesslike, and brief.

o Do not mix the good with the bad.

o Avoid making accusations and expressing personal feelings.

o Avoid bringing up personality differences.

o Provide severance pay information.

o Explain how you will handle employment inquiries from future employers.

b. Due Process: procedures that constitute fair treatment, such as allowing an employee to tell his or her story about an alleged infraction and defend against it.

CO 13.3: Identify the different types of alternative dispute resolution methods.

13.2F. Alternative Dispute Resolution (ADR) Procedures: a term applied to different employee complaint or dispute resolution methods that do not involve going to court.

l. Addressing claims outside of court is generally faster and cheaper.

a. Step-Review Systems: a system for reviewing employee complaints and disputes by successively higher levels of management

 It generally follows the union grievance system.

b. Peer-Review Systems: a system for reviewing employee complaints that utilizes a group composed of equal numbers of employee representatives and management appointees.

 The group weighs evidence, considers arguments, and, after deliberation, votes to render a final decision. A peer-review system functions as a jury.

c. Open-Door Policy: a policy of settling grievances that identifies various levels of management above the immediate supervisor for employee contact.

 One way to make an open-door policy work better is to ensure that employees first try to work out their problems with their immediate supervisor.

d. Ombud System

 An ombud is a designated individual from whom employees may seek counsel for resolution of their complaints.

 Because the ombudsman has no authority to finalize a solution, compromises are likely.

e. Mediation is the use of an impartial neutral to reach a compromise decision in employment disputes.

13.14

 A mediator is a third party in an employment dispute who meets with one party and then the other to suggest compromise solutions or to recommend concessions from each side that will lead to an agreement.

f. Arbitration: the employee and employer present their cases to an arbiter, who is typically a retired judge.

 The judge then makes a decision that the parties have agreed to be bound by.

 It is used primarily to resolve discrimination suits.

EOC (Optional) Discussion Question #4: 5 minutes total.

Discussion Activity 9

What do you think would constitute an effective alternative dispute resolution system? What benefits would you expect from such a system? If you were asked to rule on a discharge case, what facts would you analyze in deciding whether to uphold or reverse the employer’s action?

13.3. Managerial Ethics in Employee Relations

l. Ethics: a set of standards of conduct and moral judgements that help to determine right and wrong behavior.

ll. Many organizations have their own code of ethics that govern how they deal with their employees and the public.

lll. The ultimate goal of ethics training is as follows:

 to avoid unethical behavior and adverse publicity

 to gain a strategic advantage

 to treat employees in a fair and equitable manner, recognizing them as productive members of the organization.

lV. Many organizations have their own codes of ethics that govern how they deal with their employees and the public.

Discussion Questions

1. Question: Explain three areas in which employee rights and employer responsibilities could result in conflict. How might this conflict arise?

Figure

Suggested answer: Drug testing, email usage, and employee searches and surveillance are three prominent areas where employee rights and employer responsibilities cacome into conflict. Other areas could include genetic testing and off-duty conduct. Conflict can arise between employees and employers when employees believe their behavior is their personal concern and not subject to employer suspicion or infringement. Employers, however, cite their responsibility to run their business in a safe and efficient manner as a defense against unlimited employee rights. For example, employees might believe they have a right to privacy in their personal email messages and object to management routinely monitoring all employee email. Ask students for other areas of possible conflict.

2. Question: What are the legislative and court restrictions on employer drug testing in both the private and the public sectors?

Suggested answer: Federal regulations and laws restrict drug testing as well. The Equal Employment Opportunity Commission does not allow job applicants to be tested before they are extended offers. The Americans with Disabilities Act protects employees who have been addicted to drugs and are recovering from them. And some drugs that would otherwise be illegal, such as opiates and medical marijuana, are legitimately prescribed for certain conditions.

Drug testing is most prevalent among employees in sensitive positions within the public sector, in organizations doing business with the federal government, and in public and private transportation companies. Since the passage of the Drug-Free Workplace Act of 1988, applicants and employees of federal contractors have become subject to testing for illegal drug use. Barring state and federal laws that restrict or prohibit drug testing, however, private employers generally have a right to require employees to submit to the tests. The exception is unionized workforces. Drug-testing programs for these employees must be negotiated by their unions.

3. Question: Discuss why documentation is so important to the disciplinary process. What constitutes correct documentation?

Suggested answer: Without full and correct documentation, managers are unable to support the disciplinary action taken against employees. Complete documentation would include (1) the date, time, and location of the incident(s); (2) the behavior exhibited by the employee (the problem); (3) the consequences of that action or behavior on the employee’s overall work performance and/or the operation of the employee’s work unit; (4) prior discussion(s) with the employee about the problem; (5) the disciplinary action to be taken and the improvements expected should be documented; (6) the consequences of failing to make the improvements by a certain follow-up date; (7) the employee’s reaction to the supervisor’s attempt to change his or her behavior; and (8) the names of witnesses to the incident (if applicable).

4. Question: What do you think would constitute an effective alternative dispute resolution system? What benefits would you expect from such a system? If you were asked to rule on a discharge case, what facts would you analyze in deciding whether to uphold or reverse the employer‘s action?

Suggested answer: Students’ answers will vary. This question is intended to have students develop different alternative dispute resolution systems and to describe benefits derived from them. Figure 13.12 in the textbook lists seven questions to consider during disciplinary investigations.

Additional Discussion Questions

The following are discussion questions that do not appear in the text, PPTs, or courseware (if courseware exists) – they are for you to use as you wish. You can assign these questions several ways: in a discussion forum in your LMS; as whole-class discussions in person; or as a partner or group activity in class.

5. Question: Google, owner of Nest, set up an internal website for employees to report whistle-blowers. After paying $200 million in fines due to one whistle-blower at Nest, the company now encourages employees to air their frustrations by talking to management before talking to the press. What are some consequences that employees can face from whistle-blowing? What government measures have been put in place that provide protection to whistle-blowers?

Suggested answer: Whistle-blowers may face retaliation and often become unemployed. In addition, not everyone sees whistle-blowing as a positive decision; rather, you may be looked at as a ―snitch.‖ The Sarbanes–Oxley (SOX) Act protects whistle-blowers employed in publicly traded companies. The law encourages whistle-blowing by motivating publicly held companies to promote a more open culture that is sympathetic to employees who have a ―reasonable belief‖ that a law has been violated. Federal employees are covered by the federal Whistleblower Protection Act (WPA). The Notification and Federal Employee Antidiscrimination and Retaliation Act (No FEAR Act) requires federal agencies to be more accountable for violations of antidiscrimination and whistle-blower protection laws. The False Claims Act (FCA) and Dodd–Frank Wall Street Reform and Consumer Protection Act protect and financially reward whistle-blowers who expose fraud related to governmental programs and wrongdoing related to consumer financial products or services, respectively. OSHA administers the whistle-blowing provisions in 15 federal statutes protecting whistle-blowers in such industries as airline, nuclear power, and public transportation.

Additional Activities and Assignments

The following are activities and assignments developed by Cengage but not included in the text, PPTs, or courseware (if courseware exists) – they are for you to use if you wish.

Group Activity in class or on Zoom. Refer to Figure 13.10, ―Common Disciplinary Problems.‖ Students will volunteer in a work-related example not using any names from each of the four categories (attendance problems, dishonesty and related problems, work performance problems, and on-the-job behavior problems) that they have observed or been involved in as the supervisor.

 For each example, identify the gender and approximate age of the employee and his or her supervisor who handled the disciplinary issue.

 Briefly describe the background of the disciplinary issue.

 Refer to Figure 13.11, ―A Disciplinary Model,‖ and identify which steps were followed, omitted, or done poorly. Identify the outcome of the situation discipline issue was resolved and employee stayed employed at the organization, employee was discharged, etc.

Case Study 1: Discharged for Off-Duty Behavior

1. Question: Given the facts of this case, should Chad have been discharged? Why or why not?

Suggested answer: Students‘ answers will vary. Chad was fired for making a tweet on the team‘s official account that the other team considered ―not very classy.‖ The tweet made on his own time on a personal account was looking for a new job. In this case study, it is important that students distinguish between tweets made on a company‘s account and tweets on a personal account.

2. Question: Should the social media manager of a company be held to a higher standard of personal conduct than others in the company? Explain.

Suggested answer: Students‘ answers will vary. Organizations in different types of businesses have traditionally imposed different codes of conduct upon their employees. Police agencies, fire departments, educational institutions or other organizations operating in the ―public‘s eye‖ have high moral and ethical standards for their employees. Employers in less public environments likely have lower standards of personal conduct for their employees.

3. Question: Should management have considered Chad‘s past work record before deciding on discharge? Explain.

Suggested answer: Sports teams are in the public eye, but fans frequently taunt the opposing team. Students should consider if the team‘s social media accounts can taunt an opponent at the same level as a fan or if it should maintain higher standards. Students‘ answers will vary. If Chad was warned about previous tweets, he would not have made this tweet that opponents found to be offensive.

Case Study 2: You Can’t Fire Me! Check Your Policy

1. Question: What role, if any, should Hattie‘s past work record play in this case? Explain your answer.

Suggested answer: As a general rule, in termination cases for absenteeism, the employee‘s seniority and work record have influenced labor arbitrators to either uphold or modify the discharge penalty. It is believed that long-time employees and those with good performance

records should receive more consideration when discipline is recommended. However, the amount of consideration needed varies with each case and may depend on how diligently the employee has worked to improve attendance. Other factors to consider include (1) how tolerant management has been to the employees‘ absences, and (2) how long the attendance problem has persisted.

2. Question: Does management have a right to know why employees refuse to work overtime? Why or why not?

Suggested answer: Management has no ―legal right‖ to know why employees refuse overtime requests. Regardless, management has a right to question employees about their proposed absences and to evaluate their responses. It would be difficult to operate a business where employers could not question employees regarding absences from work. When employees have valid and rational reasons for not working, those reasons are Normally accepted when making work assignments. However, when employee reasons for refusing to work are minor, then management will discipline employees, particularly where job assignments are critical to organizational performance.

3. Question: Evaluate the arguments of Hattie Mae and management in this case.

Suggested answer: Hattie‘s argument that the company did not follow its published disciplinary policy is compelling. This is particularly true where the disciplinary policy is progressive and outlines various penalty steps leading to termination. As noted in the textbook, one purpose of progressive discipline or a positive discipline policy is to inform employees where they stand and what is expected of them to achieve acceptable organizational performance. Talking periodically to employees about their behavioral problems may simply not be enough to impress upon them the importance of appropriate behavior. Furthermore, because Hattie‘s absences are due to accepted illnesses or workrelated accidents, she may believe her absenteeism is acceptable to management. Management argues that Hattie had been warned of her attendance problem. Unfortunately, due to the nature of her absences, improvement could not be expected. Therefore, termination was appropriate. Nevertheless, the fact that management did not follow its written discipline policy greatly weakens its case. Had Hattie been given behavior.

4. Question: If you were a member of the company‘s peer-review complaint committee, how would you vote in this case? What facts would cause you to vote this way?

Suggested answer: Answers will vary. The important thing is not the answer but evidence that some thought went into the answer. In this case, the arbitrator noted that Hattie‘s excessive absenteeism would normally have justified a termination decision. However, because management clearly violated its progressive discipline policy, a policy upon which the employee could expect compliance, the termination was overturned. As the arbitrator noted, ―If employers could pick and choose when they elected to apply progressive discipline to employee behavioral infractions, then the policy serves no important expectations for the employee. In this case, the discharge was reduced to a written warning Management was told it could continue progressive discipline if the employee‘s attendance did not improve

Additional Resources

Cengage

Video Resources

 MindTap Videos:

Chapter 14: The Dynamics of Labor Relations Instructor Manual

Purpose and Perspective of the Chapter

Mention Labor Day and most people think of the start of the football season, shopping Labor Day sales, mourning the unofficial end of summer, or complaining about that one time they needed to renew their driver‘s license and the DMV closed early. Labor Day, without all of its modern trappings, is a federal holiday honoring the American labor movement and its contributions to worker health, safety, well-being, and productivity.

Mention labor movements and trade unions, and most people will have a more polarized opinion, whether considering the adversarial relationship between employees and higher-ups and strikes, or industrial democracy, fairness, opportunity, and equal representation. And some may wonder if unions are still relevant today, in an era with worker safety laws and globalization. Unions are still at large, influencing policies and helping workers in a range of different ways. For example, unions played a major role in protecting worker rights during the COVID-19 pandemic. New York nursing homes affiliated with labor unions had fewer COVID-19 deaths and infections than those without union representation. Union letter carriers save lives by alerting officials if an elderly person hasn‘t been collecting his or her mail. Even the TV shows you watch are the product of one of America‘s most unionized industries.

Chapter Objectives

The following objectives are addressed in this chapter:

1. Describe the process by which unions organize employees and gain recognition as their bargaining agent.

2. Discuss the bargaining process and the bargaining goals and strategies of a union and an employer.

3. Outline how the Labor Agreement might establish the issue of management rights and union security agreements, and what these may imply.

4. Describe a typical union grievance procedure, including the basis for arbitration awards.

5. Identify key challenges that unions face, and discuss how unions might deal with the issues associated with these challenges.

Key Terms

Arbitrator: A third-party neutral who resolves a labor dispute by issuing a final decision in the disagreement.

Authorization card: A statement signed by an employee authorizing a union to act as a representative of the employee for purposes of collective bargaining.

Bargaining power: The power of labor and management to achieve their goals through economic, social, or political influence.

Bargaining unit: A group of two or more employees who share common employment interests and conditions and may reasonably be grouped together for purposes of collective bargaining.

Bargaining zone: An area in which the union and the employer are willing to concede when bargaining.

Collective bargaining process: The process of negotiating a labor agreement, including the use of economic pressures by both parties.

Craft unions: Unions that represent skilled craft workers.

Employee associations: Labor organizations that represent various groups of professional and white-collar employees in labor-management relations.

Exclusive representation: The legal right and responsibility of the union to represent all bargaining unit members equally, regardless of whether employees join the union or not.

Fair representation doctrine: A doctrine under which unions have a legal obligation to assist both members and nonmembers in labor relations matters.

Grievance procedure: A formal procedure that provides for the union to represent members and nonmembers in processing a grievance.

Industrial unions: Unions that represent all workers skilled, semiskilled, unskilled employed along industry lines.

Interest-based bargaining: Problem-solving bargaining based on a win-win philosophy and the development of a positive long-term relationship.

Labor relations process: A logical sequence of five events: (1) workers desire collective representation, (2) the union begins its organizing campaign, (3) the NLRB representation process begins, (4) collective negotiations lead to a contract, and (5) the contract is administered

National Labor Relations Board (NLRB): The agency responsible for administering and enforcing the Wagner Act. It serves the public interest by reducing interruptions in production or service caused by labor management strife

Offshoring: Work that was previously carried out in one country is moved to another country.

Rights arbitration: Arbitration over interpretation of the meaning of contract terms or employee work grievances.

Unfair labor practices (ULPs): Specific employer and union illegal practices that deny employees their rights and benefits under federal labor law.

Union: organized associations of workers formed to further the interests of the individuals working for an employer.

Union security agreement: Where an employer and the union agree on the extent to which the union may compel employees to join the union and how the dues will be collected.

Union steward; An employee who as a nonpaid union official represents the interests of members in their relations with management.

What's New in This Chapter

The following elements are improvements in this chapter from the previous edition:

Chapter # New component(s)

Chapter 14 ● Discussion of how the last presidential election impacted unions and their traditional allegiance to the Democratic Party.

Chapter 14 ● New research showing the decrease in union membership, but certainly not a decrease in labor movements.

Chapter 14 ● New examples of how unionizing successfully raised employees‘ starting salary.

Chapter 14 ● Adjustment of learning outcomes organization.

Chapter Outline

The following outline organizes activities (including any existing discussion questions in PowerPoints or other supplements) and assessments by chapter (and therefore by topic), so that you can see how all the content relates to the topics covered in the text

CO 14: 1: Describe the process by which unions organize employees and gain recognition as their bargaining agent.

14.1. The Labor Relations Process

l. Unions are organized associations of workers formed to further the interests of the individuals working for an employer.

ll. The National Labor Relations Board (NLRB) is the agency responsible for administering and enforcing the Wagner Act.

 It serves the public interest by reducing interruptions in production or service caused by labor–management strife.

 When workers decide to unionize, the labor relations process begins.

III. The labor relations process is a logical sequence of five events: Figure 14.1

 workers desire collective representation

 the union begins its organizing campaign

 the NLRB representation process begins

 collective negotiations lead to a contract

 the contract is administered.

(Optional) Knowledge Check: <5 minutes total

Use Figure 14.1 to discuss the labor relations process. Ask students to describe a situation they recently heard of regarding unions.

14.1A.

14.2

Why Employees Unionize Figure

l. After declining for the last few decades, alternative collective labor structures have become popular among the millennials.

ll. Rather than increased pay, millennials are interested in work–life balance, a teamoriented work culture, and transparency concerning compensation and promotion.

(Optional) Knowledge Check: <5 minutes total

Use Figure 14.2 to discuss the reasons employees want to unionize.

lll. Employees see unions as a way to achieve results in several areas:

 Dissatisfaction with management

 Economic needs

 Social and status needs

o The union provides workers leadership opportunities, like becoming a union steward which puts leadership talents to use as officers of the union and representatives of fellow employees

lV. Campaigns based on social concerns (e.g., justice, equality, and teamwork) are more

14.1B. Challenges of Unions to Management

l. Most employers would rather not deal with unions.

 Unions typically try to achieve greater participation in management decisions that affect their members, but employers want to keep these decisions as management prerogatives

 Unions can create divisions between management and workers, making it difficult to foster a team spirit.

ll. To avoid unions, many organizations try to provide a work environment in which employees do not feel the need to unionize.

14.1C. Union Avoidance Practices: six practices to decrease the desire to unionize:

 Pay: Pay above-market wage and benefits policies.

 Promotions: Promote more employees from within.

Figure 14.3

 Conduct cultural audits: They inform management about the events and attitudes in the organization.

 Offer job rotations and training programs: Reduce burnout and increase employee satisfaction.

 Share information with employees about the state of the organization: Open book management provides transparency and helps employees understand management decisions.

 Desirable working conditions: The work environment should be equally desirable as other firms in the same industry In a post COVID work world, this means providing sufficient amenities for people who work from home (Optional) Knowledge Check: <5 minutes total Use Figure 14.3 to discuss union avoidance practices. Ask students if they can suggest any additional methods

14.1D. Organizing Campaigns

l. When employees decide to unionize, a union organizer or employees start a formal organizing campaign.

a. Organizing Steps

Figure 14.4

 Step 1: Employees and union officials meet to explore the possibility of unionization. To win employee support, labor organizers build a case against the employer and for the union.

 Step 2: The organizer schedules an initial union meeting to attract more supporters. Meetings also (1) identify employees who can help the organizer direct the campaign and (2) establish communication with all employees.

 Step 3: Form an in-house organizing committee composed of employees willing to provide leadership to the campaign.

Instructor Manual: Snell/Morris, Managing Human Resources 19e, c23, ISBN: 9780357716519; Chapter #1: The Opportunities and Challenges of Human Resources Management

o An authorization card is a statement signed by an employee authorizing a union to act as a representative of the employee for purposes of collective bargaining.

o At least 30 percent of the employees must sign authorization cards.

 Step 4: A publicity campaign seeks employee support and votes. If enough employees support the union, the organizer seeks a government-sponsored election.

 Step 5: The union wins the election. The NLRB certifies the union as the legal bargaining representative of the employees. Contract negotiations begin.

o If the union can’t secure a contract agreement between the employers and the union within one year, the employees can vote out the union through a NLRB decertification election.

b. Organizing Tactics:

 Political involvement

 Neutrality agreements  Organizer training

 Corporate campaigns

 Social media

14.1E. Employer Tactics Opposing Unionization- a two-pronged campaign:

 stress favorable employer–employee relationships

 emphasize unfavorable aspects of unionism, such as strikes, union dues and special assessments, abuses of members’ legal rights, and false promises.

l. Unfair labor practices (ULPs) are specific employer and union illegal practices that deny employees their rights and benefits under federal labor law.

ll. Employers cannot threaten employees or improve conditions to get employees to vote against the union.

14.1F. How Employees Become Unionized

l. A bargaining unit is a group of two or more employees who share common employment interests and conditions and may reasonably be grouped together for purposes of collective bargaining.

ll. If the employer and a union cannot agree on who should be in the bargaining unit, the NLRB will choose.

EOC (Optional) Discussion Question:#1> 5 minutes total.

Discussion Activity 1

Describe what it means for HR managers when employees win an election to unionize. What can HR do at this point to make sure the employees’ and company’s interests align?

14.1G. NLRB Representation Election

l. An NLRB-conducted election is possible if 30 percent of employees within the bargaining unit are signed up.

ll. The NLRB holds a pre-election hearing with the employer and the union. In the preelection hearing several things occur:

 Verification of the authorization cards

 Verification of the NLRB’s jurisdiction to hold the election

 Determination of the bargaining unit

 The date of the election

 The voting choices to appear on the ballot (including a choice of ―no union‖)

lll Exclusive representation is the legal right and responsibility of the union to represent all bargaining unit members equally, regardless of whether employees join the union or not.

lV. Craft unions are unions that represent skilled craft workers.

V. Industrial unions are unions that represent all workers skilled, semiskilled, unskilled employed along industry lines.

Figure 14.5

Vl. Employee associations are labor organizations that represent various groups of professional and white-collar employees in labor-management relations.

(Optional) Knowledge Check: <5 minutes total

Use Figure 14.5 to discuss the different types of unions. Ask students to describe labor unions in which family or friends participate.

a. Public Unions

 Unions are important for federal, state, and local government employees.

 Public sector and private sector collective bargaining have similarities and differences.

 Public sector collective bargaining falls within the jurisdiction of each state, creating diversity.

CO 14.2: Discuss the bargaining process and the bargaining goals and strategies of a union and an employer

14.2. The Bargaining Process

l. The collective bargaining process is the process of negotiating a labor agreement, including the use of economic pressures by both parties.

(Optional) Knowledge Check: <5 minutes total Use Figure 14.7 to discuss the bargaining process.

14.2A. Preparing for Negotiations

l. Preparing for negotiations includes assembling data to support bargaining proposals and forming the bargaining team.

ll. Preparing for negotiations starts soon after the current agreement has been signed.

 Each side has four to six representatives led by a chief negotiator.

14.2B. Gathering Bargaining Data

l. Employers gather economic data primarily in the areas of wages and benefits.

ll. Union negotiators ―take wages out of competition,‖ which means having similar contract provisions between different companies so that one company does not have a labor cost advantage.

14.2C. Developing Bargaining Strategies and Tactics

l. An employer is more willing to meet union demands during times of economic growth.

ll. The employer’s bargaining strategy must address the following points:

 Likely union proposals and management responses

 A list of management demands, limits of concessions, and anticipated union responses

 Development of a database to support management bargaining proposals and to counteract union demands

 A contingency operating plan if employees strike

lll. Both parties will ask for more than they want to provide room for concessions.

14.2D.

Negotiating the Labor Agreement

Figure 14.6

l. Typically, each side focuses on one issue or several related issues until agreement is reached.

ll. The bargaining zone is an area in which the union and the employer are willing to concede when bargaining.

lll. As bargaining takes place, several variables influence the negotiators.

EOC (Optional) Discussion Question:#2> 5 minutes total.

Discussion Activity 2

Of what significance is the bargaining zone in the conduct of negotiations? What are some influences affecting negotiated outcomes? The negotiations between data services international and its union have become deadlocked. What form of bargaining power does each side possess to enforce its bargaining demands?

What are the advantages and disadvantages of each form of bargaining power for both the employer and union?

14.2E.

Good-Faith Bargaining

l. The Taft-Hartley Act requires that employers and union representatives negotiate in good faith with union representatives over employment conditions.

ll. Good faith means that demands should be reasonable and realistic.

14.2F.

Interest-Based Bargaining

l. Labor-management negotiations are adversarial. A non-adversarial approach gives better results.

ll. Interest-based bargaining is problem-solving bargaining based on a win-win philosophy and the development of a positive long-term relationship.

 Participants use brainstorming, consensus decision-making, active listening, process checking, and matrix building.

14.2G.

Management and Union Power in Collective Bargaining

l. Bargaining power is the power of labor and management to achieve their goals

through economic, social, or political influence

a. Union Bargaining Power

 The bargaining power of the union may be exercised by striking, picketing, or boycotting the employer’s products or services.

 A strike is the refusal of a group of employees to perform their jobs.

 Picketing places people at business entrances to advertise the dispute and to discourage others from entering the premises.

 A boycott is a refusal to patronize the employer.

b. Management Bargaining Power

 The employer’s bargaining power is continuing operations or shutting down operations entirely.

 If employees strike, employers have a legal right to hire replacement workers. In extreme situations, an employer may lock out its employees.

14.2H. Resolving Bargaining Deadlocks Figure 14.7

l. Unions and employers use mediation and arbitration to resolve bargaining deadlocks.

ll. An arbitrator is a third-party neutral who resolves a labor dispute by issuing a final decision in the disagreement.

lll. In the public sector, where strikes are largely prohibited, the use of interest arbitration is a common method to resolve bargaining deadlocks

. CO 14.3: Outline how the Labor Agreement might establish the issue of management rights and union security agreements, and what these may imply.

14.3. The Labor Agreement

l. When negotiations are concluded, the labor agreement becomes a formal binding document listing the terms, conditions, and rules under which employees and managers agree to operate.

ll. Two important items in any labor agreement pertain to management rights and the forms of security afforded to the union.

14.3A. Management Rights

l. Labor agreements contain a management rights clause.

 It states that management’s authority is supreme in all matters except those it expressly conceded or in those areas restricted by law.

EOC (Optional) Discussion Question:#3> 5 minutes total.

Discussion Activity 3

How might a management rights clause determine what conditions an employer can control in the workplace? What is identified by the union security agreement, and how might this reflect results of the bargaining process

14.3B.

Union Security Agreements

l. In a union security agreement, an employer and the union agree on the extent to which the union may compel employees to join the union and how the dues will be collected.

CO 14.4: Describe a typical union grievance procedure, including the basis for arbitration awards.

14.4.

Administration of the Labor Agreement

l. After a labor agreement is signed, each side will naturally interpret ambiguous clauses to its own advantage.

ll. Differences are resolved through the grievance procedure.

14.4A. Negotiated Grievance Procedures

l. The grievance procedure is a formal procedure that provides for the union to represent members and nonmembers in processing a grievance.

 It is normally initiated by the union or an individual employee.

14.4B.

Grievance Arbitration

l. Rights arbitration is arbitration over interpretation of the meaning of contract terms or employee work grievances.

ll. The fair representation doctrine is a doctrine under which unions have a legal obligation to assist both members and nonmembers in labor relations matters.

a. Arbitration Hearing

 A submission agreement is a statement of the problem to be resolved.

 The parties then make opening statements, present the facts and evidence, and present the witnesses.

 The hearing concludes with summary statements from each side.

 The primary purpose of the hearing is to help the arbitrator get the facts needed to resolve a problem before it becomes a legal problem.

b. Arbitration Award

 The arbitration award is a formal written document given to both sides. It contains five parts:

o submission agreement

o facts of the case

o positions of the parties

o opinion of the arbitrator

o decision rendered.

 Arbitrators use four factors when deciding cases:

o the wording of the labor agreement

o the submission agreement as presented to the arbitrator

o testimony and evidence offered during the hearing

o arbitration criteria or standards against which cases are judged. The decisions can be subjective.

CO14.5: Identify key challenges that unions face, and discuss how unions might deal with the issues associated with these challenges.

14.5. Contemporary Challenges to Labor Organizations

l. Unions are faced with a decrease of union membership, foreign competition, and technological advances

14.5A. Decrease in Union Membership- stems from several factors:

 A shift from traditional unionized industries to high-technology industries

 Growth in the employment of part-time and temporary workers

 Growth in small businesses, in which unionization is more costly and difficult to perform

 Globalization of the workforce particularly among low-wage employers

l. Unions are battling the decline in membership through energized organizing and aggressive unionization strategy.

ll. Unions are targeting low-wage service workers and considering recent immigrants to be a pool of potent prospects.

14.5B. Globalization and Technological Change

l. Unions are demanding more government protection against imports to protect U.S. jobs from low-cost overseas producers.

ll. Offshoring is work that was previously carried out in one country and moved to another country.

lll. Most of the job loss that occurs in the United States is a result of technology advances.

EOC (Optional) Discussion Question:#4> 5 minutes total.

Discussion Activity 4

What are some of the actions being taken by unions to cope with the contemporary challenges they face? b. How can companies respond to the labor changes that result from increased technology and globalization?

Discussion Questions

1. Question: Describe what it means for HR managers when employees win an election to unionize. What can HR do at this point to make sure the employees‘ and company‘s interests align?

Suggested answer: The employees to be organized constitute the bargaining unit to be covered by the labor agreement. The NLRB defines a bargaining unit as a group of two

or more employees who have common employment interests and conditions and may reasonably be grouped together for purposes of collective bargaining. If an employer and a union cannot agree on who should be in the bargaining unit, an appropriate bargaining unit will be determined by the NLRB on the basis of a similarity of interests (such as wages, job duties, or training) among employees within the unit.

2. Question: Of what significance is the bargaining zone in the conduct of negotiations? What are some influences affecting negotiated outcomes? The negotiations between data services international and its union have become deadlocked. What form of bargaining power does each side possess to enforce its bargaining demands? What are the advantages and disadvantages of each form of bargaining power for both the employer and union?

Suggested answer: For each bargaining issue to be resolved satisfactorily, the point at which agreement is reached must be within limits that the union and the employer are willing to accept. In a frequently cited bargaining model, Ross Stagner and Hjalmar Rosen call the area within these two limits the bargaining zone.

Influencing factors include bargaining history between parties, laws and administrative rulings, other negotiated outcomes, public opinion, personalities of negotiators, and economic influences.

The bargaining power of the union may be exercised by striking, picketing, or boycotting the employer’s products or services. When negotiations become deadlocked, the employer’s bargaining power largely rests on being able to continue operations in the face of a strike or to shut down operations entirely.

All of these actions are economic weapons. The union threatens the employers economically by refusing to work and the employer threatens workers by preventing them from working. Depending on the influencing factors, the union or the employer will gain the advantage.

3. Question: How might a management rights clause determine what conditions an employer can control in the workplace? What is identified by the union security agreement, and how might this reflect results of the bargaining process

Suggested answer: Almost without exception, the labor agreement contains a management rights clause. This clause states that ―management‘s authority is supreme in all matters except those it has expressly conceded in the collective agreement, or in those areas where its authority is restricted by law.‖ Management rights might include the right of management to determine the products to produce, to determine the location of production or service facilities, or to select production equipment and

4. Question:

a. What are some of the actions being taken by unions to cope with the contemporary challenges they face?

b. How can companies respond to the labor changes that result from increased technology and globalization?

Suggested answer: Unions are battling the decline in membership through energized organizing and aggressive unionization strategy Unions are targeting previously ignored service workers such as janitors. Unions see recent immigrants, the fastest growing segment of working people as a potent prospect for union growth.

To bring back jobs, the United States renegotiated the North Atlantic Trade Agreement to ensure fewer jobs were going to Mexico and staying in the United States. This new trade agreement, known as the United States-Mexico-Canada Trade Agreement (USMCA) was enacted July 1, 2020, and has been responsible for some jobs coming back to the United States. But using trade barriers and punishing American companies for sending jobs outside the United States has major implications for the competitiveness of American companies. Such pressures could cause companies to send their headquarters to other countries or simply make American companies less able to compete against foreign companies.

5. Question: What are unions doing to prevent decline in membership? How are factors like foreign competition and technological advances causing issues for unions?

Suggested answer: What are labor organizations doing to stem the decline in union membership? The answer, according to one union official, is ―energized organizing.‖ First, unions are targeting workers they have long ignored: low-wage service workers on the bottom tier of the U.S. economy for example, janitors, maids, and service workers; food service employees; and retail clerks. Furthermore, unions see recent immigrants, the fastest-growing segment of working people, as a potent prospect for union growth.

The importation of steel, consumer electronics, automobiles, clothing, textiles, and shoes from foreign countries creates a loss of jobs in the United States for workers who produce these products. Furthermore, foreign subsidiaries of American corporations such as Carrier, Westinghouse, and Xerox have been accused by labor unions of exporting the jobs of U.S. workers. As a result, unions are demanding more government protection against imports, seeking to protect U.S. jobs from low-cost overseas producers. To add to that, in recent years, the service sector of the U.S. economy has witnessed the outsourcing of white-collar jobs to foreign employers in locations such as India and Indonesia.

Additional Discussion Questions

The following are discussion questions that do not appear in the text, PPTs, or courseware (if courseware exists) – they are for you to use as you wish. You can assign these questions several ways: in a discussion forum in your LMS; as whole-class discussions in person; or as a partner or group activity in class.

6 Question: Describe the steps in the traditional organizing drive

Suggested answer:

Step 1: Employees and union officials meet to explore the possibility of unionization. To win employee support, labor organizers build a case against the employer and for the union

Step 2: The organizer schedules an initial union meeting to attract more supporters. Meetings also 1) identify employees who can help the organizer direct the campaign and 2) establish communication with all employees

Step 3: Form an in-house organizing committee composed of employees willing to provide leadership to the campaign. An authorization card is a statement signed by an employee authorizing a union to act as a representative of the employee for purposes of collective bargaining. At least 30 percent of the employees must sign authorization cards.

Step 4: A publicity campaign seeks employee support and votes. If enough employees support the union, the organizer seeks a government-sponsored election

Step 5: The union wins the election. The NLRB certifies the union as the legal bargaining representative of the employees. Contract negotiations begin. If the union can’t secure a contract agreement between the employers and the union within one year, the employees can vote out the union through a NLRB decertification election

Additional Activities and Assignments

The following are activities and assignments developed by Cengage but not included in the text, PPTs, or courseware (if courseware exists) – they are for you to use if you wish.

Union Membership:

Neoliberal trade and tax policies that encourage employers to move jobs to places where they can pay workers the least are also to blame, says Richard Trumka, president of the AFL-CIO. In addition, the occupations and industries where union participation has historically been highest have shrunk. Source: https://www.cnbc.com

Go to the AFL-CIO website and update the status of union membership. https://aflcio.org/ Share your findings with the class

Case Study 1: The New Union Battles: Public Unions vs. Rich World Governments

1. Question: Why are politicians so interested in trying to repeal collective bargaining rights for public sector employees?

Suggested answer: The weak economy in 2011 resulted in many states seeing tax revenue going down but not spending requirements. Given that state governments do not have the same power as the federal government to create money or run a deficit (normally they are required to balance their budgets), the states were confronted with the need to find ways to not only cut spending but to prevent increases such as higher pay and benefits for government workers. As a result, some states placed limits upon collective bargaining and/or exactly what could be included in negotiations.

2. Question: What risks does losing their collective bargaining rights hold for public employees? Suggested answer: The risk is that state employees may not get as much of an increase in pay and benefits as they would have otherwise. It is possible that political leaders may cut pay or some of those benefits. On the other hand, because public employees vote for those leaders, they still have the option of lobbying.

3. Question: As an elected politician charged with major cuts in your state budget, how would you negotiate with the public sector unions? As a public sector union leader, how would you negotiate with the state legislature?

Suggested answer: The politician could indicate that only a given amount will be available for compensation to state employees and to stay within the budget, the union can choose to cut pay and benefits or cut the number of state workers. Cutting the number of workers would cut the union membership. The union leader could suggest that the budget can be balanced by cutting something other than employee pay and benefits. However, if the state insists on any action that financially harms the employees, the union will make an extraordinary effort to make sure the politician does not get re-elected.

Case Study 2: The Arbitration Case of Jesse Stansky

1. Question: Which arguments should be given more weight: those based on company policy, the employee handbook, and the labor agreement or mitigating factors given by the grievant and his witnesses? Explain.

Suggested answer: Arbitrators will give different weights to facts and evidence resented in an arbitration hearing. Company policy, employee handbooks, and the labor agreement will be evaluated strongly in the employer‘s favor. Management has the right to establish the rules and regulations under which employees agree to work. The labor agreement is a binding document that the parties have jointly agreed to live under. This document serves as a foundation against which the employee‘s and employer‘s actions will be judged. The ―facts‖ of the case will always be given heavy weight by the arbitrator. The employee‘s length of service, past performance record, and any past disciplinary action will play an important role in determining the outcome of the case. The testimony of witnesses will also be judged, particularly where witnesses are considered to be highly credible.

2. Question: How might unprofessional conduct be defined? Explain.

Suggested answer: Unprofessional conduct is an ambiguous concept, and its definition may rest largely in the eye of the beholder. Some acts of industrial life are clearly unprofessional such as fighting on the job or insubordination. In this case, it is not entirely clear based on the testimony of witnesses whether Jesse Stansky was actually fighting with his coworker. Is a rough hand on the shoulder of an employee an act of fighting? How disagreeable was the discussion between Jesse and the employee? How these actions are evaluated will largely determine if Stansky‘s conduct was unprofessional.

3. Question: If you were the arbitrator, how would you rule in this case? Explain fully the reasons for your decision.

Suggested answer: Based on the facts presented in this case, the arbitrator concluded that a ―fight‖ between Stansky and the coworker did not take place. There was no conclusive proof that the rough hand placed upon the coworker‘s shoulder constituted a punch or physical shove. At the hearing, the employee testified that he did not feel that he was hit by Stansky. Rather, he felt that Stansky might become more violent and therefore feared for his safety. The arbitrator did consider the service record and past disciplinary record of the grievant. Because these documents were not strong, they were given little weight. In this actual case, given the absence of a definite fight between the employees, the discharge was reduced to a letter of reprimand. An employee should never touch another employee during disagreements.

Additional Resources

Cengage Video Resources

 MindTap Videos: o [list]

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Chapter 15: International Human Resources Management Instructor Manual

Snell, Human Resources Management, Core ISBN; Chapter #15: International Human Resources Management

Table of Contents

Purpose and Perspective of the Chapter 212

Chapter Objectives 212

Key Terms 212

Instructor Manual: Snell/Morris, Managing Human Resources 19e, c23, ISBN: 9780357716519; Chapter #1: The Opportunities and Challenges of Human Resources Management

What's New in This Chapter 214

Chapter Outline 214

Discussion

Questions

14

Additional Discussion Questions 225

Additional Activities and Assignments 226

Case Study 1: How about a 900 Percent Raise?...........................................................................17

Case Study 2: A ―Turnaround‖ Repatriate Plan: U.S. Company Moves Indian Workers Back Home………….……………………………………………………………………………………………………………………..18

Additional Resources 227

Cengage Video Resources 227

Purpose and Perspective of the Chapter

Have you ever noticed that much of what you buy is not made in the United States? The shirt you are wearing right now was probably made in Bangladesh, Vietnam, Indonesia, or China. The brand, of course, may be American (e.g., Abercrombie & Fitch, Hollister, American Eagle), but that just means that the company is headquartered here. In fact, despite anti-globalization sentiments, most companies today are involved in international business. Managing human resources across these international settings helps to leverage specialized skills, provide cheaper labor, or bring new ideas to the company. However, managing human resources internationally makes everything more complicated. Such complications arise as each country possesses unique political policies, economic situations, social and cultural norms, and technological capacities.

The first part of this chapter describes the environmental factors that affect the work of managers in a global setting. A political, economic, sociocultural, technological (PEST) analysis can assess the threats and opportunities presented to HRM. Just as with domestic operations, the environment forms a context in which HRM decisions are made. Next, we show how companies respond to environmental complications. We examine the different forms companies take to compete in a global environment international, multidomestic, global, and transnational. These organizational forms influence the managerial and human resource issues a company faces. This chapter deals with the HR activities of recruitment, selection, development, and compensation of employees working abroad. However, workers stationed in the United States work virtually with people from other cultures who speak different languages. This creates challenges for them and HR managers.

Chapter Objectives

The following objectives are addressed in this chapter:

1. Explain the political, economic, sociocultural, and technological factors in different countries that HR managers need to consider.

2. Summarize the key differences between domestic and international HRM.

3. Explain how to set up a compensation system that may account for both global and local standards.

4 Explain how labor relations differ around the world.

Key Terms

Augmented skills: Skills helpful in facilitating the efforts of expatriate managers.

Balance sheet approach: A compensation system designed to match the purchasing power in a person‘s home country.

Codetermination: Representation of labor on the board of directors of a company.

Core skills: Skills considered critical to an employee‘s success abroad.

Cultural environment: The communications, religion, values and ideologies, education, and social structure of a country.

Culture shock: Perpetual stress experienced by people who settle overseas.

Economic factors: external factors including the strength or weakness of markets, stability of trade cycles, specific industry conditions, customer preferences, and government‘s economic policies.

Expatriates (home-country and third-country nationals): Employees from the home country or a third country who are on international assignment.

Failure rates: The percentage of expatriates who do not perform satisfactorily.

Global compensation system: A centralized pay system whereby host-country employees are offered a full range of training programs, benefits, and pay comparable with a firm‘s domestic employees but adjusted for local differences.

Global corporation: A firm that has integrated worldwide operations through a centralized home office.

Global manager: A manager equipped to run an international business.

Guest workers: Foreign workers invited to perform needed labor

Home-based pay: Pay based on an expatriate‘s home country‘s compensation practices.

Host-based pay: Expatriate pay comparable to that earned by employees in a host country.

Host country: A country in which an international corporation operates.

Host-country nationals: Employees who are natives of the host country.

International corporation: A domestic firm that uses its existing capabilities to move into overseas markets.

Localization: Adapting pay and other compensation benefits to match that of a particular country.

Multidomestic corporation (MDC): A firm with independent business units operating in multiple countries.

and ideologies, education standards, and social structure

Political factors: external factors including labor laws, property rights, and patent processes.

Repatriation: The process of transition for an employee home from an international assignment.

Sociocultural factors: external factors including method and style of communications, religions, values and ideologies, education standards, and social structure

Split pay: A system whereby expatriates are given a portion of their pay in the local currency to cover their day-to-day expenses and a portion of their pay in their home currency to safeguard their earnings from changes in inflation or foreign exchange rates

Technological factors: external factors pertaining to the technological infrastructure and investments, information systems, manufacturing equipment, and consumer access to technology

Third-country nationals: Employees who are natives of a country other than the home country or the host country.

Transnational corporation: A firm that attempts to balance local responsiveness and global scale via a network of specialized operating units.

Transnational teams: Teams composed of members of multiple nationalities working on projects that span multiple countries.

Work permit or visa: A government document granting a foreign individual the right to seek employment.

What's New in This Chapter

The following elements are improvements in this chapter from the previous edition: Chapter # New component(s)

Chapter 15 ● New example of two countries working towards economic development. Chapter 15 ● Simplified and clearer Learning Objectives

Chapter Outline

The following outline organizes activities (including any existing discussion questions in PowerPoints or other supplements) and assessments by chapter (and therefore by topic), so that you can see how all the content relates to the topics covered in the text.

(Optional) Knowledge Check: <5 minutes total

Many companies, such as Nike and Apple, have received bad press for using sweatshop labor paying overseas workers very little for items that sell for hundreds of dollars. Does this sway your opinion of these companies? Why or why not?

ANSWER: Many students will say that these companies have an ethical responsibility to treat their workers fairly and will refuse to buy products they manufacture. Other students, even though they are armed with the knowledge that these companies use these practices, may have a negative view of the company but will continue to buy iPhones, iPads, and Air Jordans.

CO 15.1: Explain the political, economic, sociocultural, and technological factors in different countries that HR managers need to consider.

15.1. Analyzing Your International Environment Figure 15.1

l. A political, economic, sociological, and technological (PEST) analysis acts as an audit of a company’s environmental influences to help it determine its strategy and HR response.

ll. As an HR manager, PEST analysis can help in several ways:

 Spot business or personal opportunities and threats.

 Spot trends in the business environment so that you can proactively adapt to these changes.

 Avoid implementing HR practices in a country where they may fail.

 Break free of old habits and assumptions about how people should be managed to help bring about innovative ideas for the entire company.

(Optional) Knowledge Check: <5 minutes total Use Figure 15.1 to discuss PEST analysis.

15.1A. Political Factors

l. Political factors are external factors including labor laws, property rights, and

ll. In many countries, property rights and intellectual property rights are not protected by the government.

15.1B. Economic Factors

l. Economic factors consist of trends around market and trade cycles, specific industry changes, customer preferences, and country economic growth forecasts.

ll. In 2021 China and Norway began discussing a trade agreement. Norway will gain access to exports of China and Indonesia. China will expand trade in Europe.

lll. Their collective goal is to promote economic development, in the wake of the global coronavirus pandemic.

15.1C. Sociocultural Factors

l. Sociocultural factors are external factors including method and style of communications, religions, values and ideologies, education standards, and social structure.

ll. Factors such as labor costs and language can make another country an attractive location for building American facilities.

lll. A host country is a country in which an international corporation operates. Even in countries with many similarities, HR practices can be dramatically different.

15.1D. Technological Factors

l. Technological factors refer to the maturity of manufacturing equipment, information systems, technology platforms, research funding, and consumer access to technology

ll. Advances in technology have pushed for more service-based jobs, and information systems and technology platforms have increased the rate at which services can be traded across countries.

lll. Integrated technology platforms represent common operating systems that can be used across multiple computers connected through the Internet.

lV. Through these common platforms, work becomes less specific to particular companies and countries.

V. Individuals become empowered to compete without the need of a large company.

Vl. The Internet enables you to select various individuals offering the same services. EOC (Optional) Discussion Question #1: 5 minutes total.

Discussion Activity 1

In recent years, we have observed an increase in foreign production throughout the world. What PEST factors would you consider to be most relevant to H&M’s HR managers when trying to figure out if they should open up a plant in Vietnam to make clothes?

15.1E. Analyzing Your International Operations

Figure 15.2

l. Four basic types of organizations differ in the degree in which international activities

are separated to respond to local regions and integrated to achieve global efficiencies:

 The international corporation is a domestic firm that uses its existing capabilities to move into overseas markets.

 A multidomestic corporation (MDC) is a firm with independent business units operating in multiple countries.

 A global corporation is a firm that has integrated worldwide operations through a centralized home office.

 A transnational corporation is a firm that attempts to balance local responsiveness and global scale via a network of specialized operating units.

(Optional) Knowledge Check: <5 minutes total

Use Figure 15.2 to discuss types of organizations. Ask students which type has the most global efficiency and local responsiveness. In this chapter, any company that conducts business outside its own country is referred to as an international business.

CO 15.2: Summarize the key differences between domestic and international HRM.

15.2. Managing Your International Operations Figure 15.3

l. When a company expands globally, HR managers are responsible for ensuring that operations are staffed with the right people.

ll. Three options are available: sending people from its home country, hiring natives of the host country, and hiring natives of a different country.

 Expatriates, or home-country nationals, are employees from the home country who are on international assignment.

 Host-country nationals are employees who are natives of the host country.

 Third-country nationals are employees who are natives of a country other than the home country or the host country.

(Optional) Knowledge Check: <5 minutes total

Use Figure 15.3 to discuss changes in international staffing over time. Ask students why the use of expatriates declines over time while the use of host-country nationals increases

lll. Sending expatriates on shorter project-based assignments and shifting quickly to hiring host-county nationals has three advantages:

 Hiring local citizens is less costly.

 Foreign employers may be required to hire locally.

 Most customers prefer to do business with local companies and people.

lV. Companies continue to use expatriates only when a specific set of skills is needed or local individuals require development.

15.2A. Recruiting Internationally

l. Improved telecommunications and travel have made it easier to match employers

and employees worldwide.

ll. HR departments must be particularly responsive to the cultural, political, and legal environments both domestically and abroad when recruiting internationally.

lll. The regulatory environment outside the United States often differs substantially

lV. A work permit or visa is a government document granting a foreign individual the right to seek employment. Companies recruiting abroad often need to advertise their firms and employment ―brand‖ to recruits who are not familiar with it.

V. In less well-developed countries, referrals and radio announcements may be the best way to find workers.

VI. Others use international recruiting firms to find skilled labor abroad

VIl. Guest workers are foreign workers invited to perform needed labor.

Vlll. Although hiring nonnationals can reduce direct labor costs, indirect costs can be substantial.

a. Apprenticeships: A major source of trained labor in European nations is apprenticeship training programs.

 After training, apprentices can work for any employer.

b. Staffing Transnational Teams

 Transnational teams are teams composed of members of multiple nationalities working on projects that span multiple countries.

 These teams are especially useful for performing tasks that the firm as a whole is not yet structured to accomplish.

 The fundamental task in forming a transnational team is assembling the right group of people who can work together effectively to accomplish the team’s goals.

 Cross-cultural training can benefit transnational teams.

15.2B. Selecting Employees Internationally Figure 15.4

l. To begin hiring employees in a new country, a firm’s international HR managers should get to know the local market and hiring customs:

 Get to know the universities, technical schools, and primary schools in the area.

 Develop networks in the business and government communities.

 Understand the employees of the firm‘s competitors.

a. Selecting Global Managers

 A global manager is a manager equipped to run an international business. Six skill categories can be identified:

o The ability to seize strategic opportunities

o The ability to manage highly decentralized organizations

o An awareness of global issues

o Sensitivity to diversity issues

o Competence in interpersonal relations

o Community-building skills

 The cultural environment is the communications, religion, values and ideologies, education, and social structure of a country.

 Core skills are skills considered critical to an employee’s success abroad.

 Augmented skills are skills helpful in facilitating the efforts of expatriate managers.

ll. Several sequential steps are involved in selecting individuals for an international assignment.

 Step 1: Begin with self-selection.

 Step 2: Create a candidate pool.

 Step 3: Assess candidates‘ core skills.

 Step 4: Assess candidates‘ augmented skills and attributes (Optional) Knowledge Check: <5 minutes total

Use Figure 15.4 to discuss expatriate selection criteria. Ask students if these skills can be improved in some way.

lll. Failure rate is the percentage of expatriates who do not perform satisfactorily.

15.5

lV. The major causes of failure include poor cultural fit, lack of expatriate support from headquarters, and a spouse’s ability to adjust to new surroundings. Figure 15.6 (Optional) Knowledge Check: <5 minutes total

Use Figures 15.5 and 15.6 to discuss causes of expatriate assignment failure and factors they need to adjust to if they want to succeed. Ask students which of these factors the expatriate can control.

15.2C. Training and Development

l. Training is critical to success for expatriate managers and the foreign employees they will ultimately supervise.

ll. Good training programs help companies attract employees from host countries.

15.2D. Content of Training Programs Figure 15.7

l. Lack of training is one of the principal causes of failure among employees working internationally.

ll. They need to know about:

 the country where they are going

 that country’s culture

 the history, values, and dynamics of their own organization. (Optional) Knowledge Check: <5 minutes total

Use Figure 15.7 for an overview of what an employee needs to study before going on an international assignment

lll. Five essential elements of training and development programs prepare employees for working internationally

 language training

Figure

 cultural training

 assessing and tracking career development,

 managing personal and family life

 repatriation.

a. Language Training

 Students who plan careers in international business should start instruction in one or more foreign languages as soon as possible.

 English is almost universally accepted as the primary language for international business.

o The following illustrates the complexities of the communication process:

o In England, to ―table‖ a subject means to put it on the table for present discussion. In the United States, it means to postpone discussion

o In the United States, information flows to a manager. In cultures with centralized authority, the manager must seek out information.

o Getting straight to the point is uniquely American.

o In Japan, there are 16 ways to avoid saying ―no.‖

o When something is ―inconvenient‖ to the Chinese, it is likely impossible.

o In most foreign countries, expressions of anger are unacceptable.

o The typical American must treat silences as ―communication spaces‖ and not interrupt them.

o In general, Americans must learn to avoid gesturing with the hand.

b. Cultural Training Figure 15.8

 Cross-cultural studies reveal that nations tend to cluster along certain cultural dimensions such as their work goals, values, needs, and attitudes toward work.

 Studying cultural differences can help managers identify and understand work attitudes and motivation in other cultures.

 One of the important dimensions of leadership everywhere is the degree to which managers invite employee participation in decision making.

(Optional) Knowledge Check: <5 minutes total Use Figure 15.8 to discuss country clusters that can help managers interact successfully in other countries.

c. Assessing and Tracking Career Development

 International assignments provide developmental and career advantages.

 To maximize the career benefits of a managerial assignment, candidates should ask two key questions before accepting the foreign post:

o Do the organization’s senior executives view the firm’s international business as a critical part of their operation?

o Within top management, how many executives have a foreign-service assignment in their background, and do they feel it important for one to have overseas experience?

d. Managing Personal and Family Life

 One of the most frequent causes of an employee’s failure to complete an international assignment is personal and family stress.

 Culture shock is perpetual stress experienced by people who settle overseas.

e. Repatriation is the process of transition for an employee home from an international assignment

 Returning home may be more difficult than going overseas.

 When they return, a role may not be waiting for them, the responsibilities are diminished, and they no longer know colleagues who can help them.

 Companies often do not fully utilize the benefits of the employee’s experience.

EOC (Optional) Discussion Question #2: 5 minutes total.

Discussion Activity 2

a. Starbucks is opening new stores abroad every day, it seems. If you were in charge, would you use expatriate managers or host-country nationals to staff the new facilities? Explain your thinking.

b. This chapter places considerable emphasis on the role spouses play in terms of the success of an overseas manager. What other steps should companies take to increase the likelihood of a successful experience for all parties involved?

CO 15.3: Explain how to set up a compensation system that may account for both global and local standards.

15.3. Compensation

l. One of the most complex areas of international HRM is compensation.

ll. Different countries have different norms.

lll. The pay systems should think globally and act locally, supporting the organization’s strategy while meeting the needs of local employees.

lV. For Americans, money is likely to be the driving force while other cultures emphasize respect, family, job security, a satisfying personal life, social acceptance.

V. In individualistic cultures, such as the United States, pay plans often focus on individual performance and achievement.

Vl. In collectively oriented cultures such as Japan and Taiwan, pay plans focus more on internal equity and personal needs.

15.3A. Compensation of Host-Country Employees

l. Minimum wages vary dramatically country to country.

ll. Employee benefits can range dramatically from country to country.

Figure 15.9

lll. Some people believe that companies are overcapitalizing on worldwide compensation differences paying very little for labor while earning a lot of profit.

(Optional) Knowledge Check: <5 minutes total

Use Figure 15.9 to discuss hourly wages in different countries. Ask students why companies decide to open manufacturing plants in other countries.

15.3B. Compensation of Host-Country Managers

l. A global compensation system is a centralized pay system whereby host-country employees are offered a full range of training programs, benefits, and pay comparable with a firm’s domestic employees but adjusted for local differences.

ll. Companies with centralized systems have higher effectiveness and satisfaction levels with their compensation systems.

15.3C. Compensation of Expatriate Managers

l. To be effective, an international compensation program must:

 Provide an incentive to leave the United States

 Allow for maintaining an American standard of living

 Provide for security in countries that are politically unstable or present personal dangers

 Include provisions for good health care

 Reimburse the foreign taxes the employee is likely to have to pay (in addition to having to pay domestic taxes) and help him or her with tax forms and filing

 Provide for the education of the employee’s children abroad, if necessary

 Allow for maintaining relationships with family, friends, and business associates via trips home and other communication technologies

 Facilitate the expatriate’s reentry back home when the assignment is finished.

 Be in writing

ll. For longer-term assignments, there are two basic types of compensation systems: home-based pay and the balance sheet approach.

 Home-based pay is pay based on an expatriate’s home country’s compensation practices.

 The balance sheet approach is a compensation system designed to match the purchasing power in a person’s home country. The balance sheet approach has the following steps:

o Step 1: Calculate base pay.

o Step 2: Figure cost-of-living adjustment (COLA).

o Step 3: Add incentive premiums.

o Step 4: Add assistance programs.

lll. Split pay is a system whereby expatriates are given a portion of their pay in the local currency to cover their day-to-day expenses and a portion of their pay in their home currency to safeguard their earnings from changes in inflation or foreign exchange

IV. Host-based pay is expatriate pay comparable to that earned by employees in a host country.

V. Localization is adopting pay and other compensation benefits to match that of a particular country.

EOC (Optional) Discussion Question #3: 5 minutes total.

Discussion Activity 3

We understand that different cultures are motivated by different types of

compensation. How might this be represented in an American company that employs workers in China?

15.3D. Performance Appraisal

l. Performance appraisal problems can contribute to failure rates among expatriates and derail an individual’s career rather than enhance it.

a. Who Should Appraise Performance?

 The multirater performance appraisal is popular among global firms because an individual working internationally owes allegiance to a supervisor in the home country and a supervisor in the host country.

 This method is not popular in all countries.

b. Home versus Host-Country Evaluations

 Performance evaluations should try to balance appraisal information between the home country and the host country.

 This helps to eliminate cultural bias and lack of knowledge about an employee’s duties in a foreign country.

c. Performance Criteria: five steps to calculate the return on investment for expatriate assignments

 Define the assignment’s objectives.

 Agree on the quantifiable measurements for the assignment.

 Develop an equation that converts qualitative behavior into quantifiable measurements.

 Evaluate the expatriate’s performance against these measurements.

 Calculate the ROI.

 Factors such as leadership development are difficult to calculate but should be considered valuable.

d. Providing Feedback Figure 15.10

 Expatriate employees should have a debriefing interview immediately after they return home from an international assignment.

 A repatriation interview serves several purposes:

o It helps expatriates reestablish old ties and set new career paths.

o It addresses technical issues related to job assignments.

o It addresses general issues regarding the company’s overseas commitments.

o It documents insights about the region that can be incorporated into training programs.

(Optional) Knowledge Check: <5 minutes total Use Figure 15.10 to compare the advantages of using overseas managers with different backgrounds. Ask students to suggest situations in which each type of manager would be

CO 15.4: Explain how labor relations differ around the world.

15.4. Analyzing the International Labor Environment

l. A country’s labor environment plays a large role in international business and HR decisions.

ll. Wages, benefits, labor contracts, and other legal regulations have a major effect on doing business around the world.

lll. Union strength varies widely in different countries they are illegal in some countries and protected in others.

15.4A. Collective Bargaining in Other Countries

l. In other countries, the collective bargaining process varies widely, especially the role of the government.

ll. Collective bargaining can take place at the firm, local, or national levels.

lll. Government involvement is natural in countries where parts of industry are nationalized.

15.4B. International Labor Organizations

l. The most active international union organization is the International Trade Union Confederation (ITUC).

ll. Another active an influential organization is the International Labour Organization (ILO), a specialized agency of the United Nations created in 1919.

15.4C. Labor Participation in Management

l. In many European countries, provisions for employee representation are established by law.

ll. Germany has codetermination, which is representation of labor on the board of directors of a company.

lll. These differences mean that different approaches are required in international HRM. EOC (Optional) Discussion Question #4: 5 minutes total.

Discussion Activity 4

What are the major differences between labor-management relations in Europe and those in the United States? Do you believe that codetermination will ever become popular in the United States? Explain your position.

Discussion Questions

1. Question: In recent years, we have observed an increase in foreign production throughout the world. What PEST factors would you consider to be most relevant to H&M‘s HR managers when trying to figure out if they should open up a plant in Vietnam to make clothes?

Suggested answer: Student answers will vary. PEST factors are political, economic,

sociocultural, and technological factors. Students should consider Vietnam‘s labor laws, customer preferences regarding labor for clothing, wages in Vietnam, economic forecasts, social structure and available technology.

2. Questions:

a. Starbucks is opening new stores abroad every day, it seems. If you were in charge, would you use expatriate managers or host-country nationals to staff the new facilities? Explain your thinking.

b. This chapter places considerable emphasis on the role spouses play in terms of the success of an overseas manager. What other steps should companies take to increase the likelihood of a successful experience for all parties involved?

c. Talk with a foreign student on your campus; ask about their experience with culture shock on first arriving in the United States. What did you learn from your discussion? If the cost of living is lower in a foreign country than in the United States, should expatriates be paid less than they would be at home? Explain your position. Who should ultimately decide whether an employee should be localized or not? If grooming a talented individual for a leadership role is an important outcome of a foreign assignment, how can this be worked into a performance appraisal system?

Suggested answer:

a. Expatriate employees will be required to adjust to attitudes and behaviors of foreign managers and their style of managing Expatriates have the advantage of knowing the products, technical systems, organizational policies, company culture, and the likes of Starbucks. Host-country nationals, on the other hand, are more likely to understand their customers’ specific needs and wants. They may also be more familiar with legal issues in their country, but they certainly have a better understanding of the national culture and norms. For these reasons, they may be in a good position to customize Starbucks’ products and processes for their local markets. In all likelihood, companies such as Starbucks would want to blend a team of locals and expatriates to get the franchise going but would eventually turn things over to the host-country managers after they have gotten the technical training and experience they need.

b. The following are the steps companies can take to increase the likelihood that the assignments are successful experiences for spouses and families:

 Include the spouse in planning whenever it is possible

 Provide a thorough orientation for the spouse and the family

 Let the spouse know that his or her interests and welfare are important to the organization

c. Students’ answers will vary based on the information obtained from interviews with foreign students or foreign-born coworkers.

3. Question: We understand that different cultures are motivated by different types of compensation. How might this be represented in an American company that employs

workers in China?

Suggested answer: Minimum wages vary dramatically country to country. Employee benefits can range dramatically from country to country as well. Some people believe that companies are overcapitalizing on worldwide compensation differences paying very little for labor while earning a lot of profit. In the past, the compensation of hostcountry managers has been based on local salary levels. Today, more companies are offering their host-country employees a full range of training programs, benefits, and pay comparable with their domestic employees back in the country of origin but adjusted for local differences. These programs are global compensation systems. Companies with centralized systems have higher effectiveness and satisfaction levels, and more companies are moving toward centralized systems.

4. Questions:

a. What are the major differences between labor-management relations in Europe and those in the United States?

b. Do you believe that codetermination will ever become popular in the United States? Explain your position.

Suggested answers:

a. The major differences between labor-management relations in Europe and those in the United States are as follows:

 In Europe, companies typically negotiate with the union at the national level through an employer association.

 European unions have more political power than those in the United States.

 There is a greater tendency for managerial personnel to be unionized in Europe.

 Unions occupy a more accepted place in Europe when compared to the United States.

b. Students’ answers will vary. Codetermination involves having representatives of labor on the board of directors as required by law.

Additional Discussion Questions

The following are discussion questions that do not appear in the text, PPTs, or courseware (if courseware exists) – they are for you to use as you wish. You can assign these questions several ways: in a discussion forum in your LMS; as whole-class discussions in person; or as a partner or group activity in class.

1. Question: Do you think there should be some international standard for labor rights? If so, what should that standard be and how should it be enforced?

Suggested answer: Answers will vary. A country‘s labor environment plays a large role in international business and HR decisions. Wages and benefits vary across the world as do safety, child, and other legal regulations. In many countries, the regulation of labor contracts is profound and extensive. Labor unions around the world differ significantly.

Differences exist not only in the collective bargaining process, but also in the politicallegal conditions.

For example, the EU prohibits discrimination against workers in unions, but in many other countries, including countries in Central America and Asia, labor unions are illegal. China has only one union, (ACFTU), a Communist Party institution that for decades has aligned itself more closely with management than workers. Firms that do business in China reach collective bargaining agreements with the ACFTU.

Additional Activities and Assignments

The following are activities and assignments developed by Cengage but not included in the text, PPTs, or courseware (if courseware exists) – they are for you to use if you wish.

International Internships; IES Internships. Get a full-time summer and semester internship in one of 12 global cities with IES Internships! As a unit of IES Abroad, a not-for-profit study abroad provider with more than 55 years of internship programming expertise, IES Internships guarantees you a placement in the field of your choice. Go to the IES website and research the international internships offered. Report your findings to the class: https://www.iesabroad.org/internships/full-time/getstarted?gclid=Cj0KCQiAqbyNBhC2ARIsALDwAsBpK8ckzzqpl16NNSsBW3wK7qCHBtnjkXi BUIH5wG9ADL7Qq5XVr4waAlzWEALw_wcB

Case Study 1: How about a 900 Percent Raise?

1. Question: Is recruiting nurses abroad a good idea for U.S. hospitals facing worker shortages?

Suggested answer: In the age of globalization, not only are countries becoming more mobile, but so are employees. The nursing industry faces such a critical shortage of talent that recruiting abroad is a viable strategy.

2. Question: Can you think of any cultural problems U.S. hospitals might encounter as a result?

Suggested answer: The nurses face many of the same challenges as U.S. expatriates sent abroad: language and cultural barriers as well as differing nursing protocols. In some instances, the nurses will encounter difficulty from patients who would rather be treated by ―native‖ U.S. citizens. In other instances, particularly when dealing with members of the large Hispanic population in the United States, they will have an advantage. In addition to learning about the country, nursing procedures, and so forth, they will have to learn the politics and culture of the individual hospitals they have joined.

3. Question: What long-term recruiting measures should U.S. hospitals strive for?

Suggested answer: One long-term strategy the hospitals should pursue is the retention of the nurses they develop, given their significant investment in training them. The hospitals will also need to keep an eye on the labor supply and demand of nurses not only in the United States and Mexico, but worldwide, given the fact that labor is very mobile today. If the Mexico model is successful, the hospital may be able to implement the same strategy in other countries.

Case Study 2: A “Turnaround” Repatriate Plan: U.S. Company Moves Indian Workers Back Home

1. Question: Does repatriation represent a good financial strategy for firms with international employees?

Suggested answer: If the employees are anxious to return home, the situation is a win-win proposition for both i2 and the repatriates. Both can benefit financially. In this case, age differentials around the world work in favor of both i2 and its employees.

2. Question: Besides cost savings, does i2 have anything to gain by repatriating its Indian employees?

Suggested answer: As India‘s tech market grows, the strategy could help i2 expand its operations (globalize) in India and elsewhere in Asia and around the world.

3. Question: What type of repatriation preparation training do you think i2‘s repatriates should receive before going home?

Suggested answer: This will make a good discussion question for students. Many of the repatriation issues will be the same as those for U.S. expatriates returning home to the United States. If there are foreign-born students in the class, ask them to think about the challenges returning home wage differentials would pose to workers who have lived in the United States

Additional Resources

Cengage Video Resources

MindTap Videos: o Chapter 15: On The Job: Black Diamond Global HR

Chapter 16: Implementing HR Strategy:

High-Performance Work Systems

Instructor Manual: Snell/Morris, Managing Human Resources 19e, c23, ISBN: 9780357716519; Chapter #1: The Opportunities and Challenges of Human Resources Management

Instructor Manual

Snell, Human Resources Management, Core ISBN; Chapter #16: Implementing HR Strategy: High-Performance Work Systems

Table of Contents

Purpose and Perspective of the Chapter 229

Chapter Objectives 229

Key Terms 229

What's New in This Chapter 229

Chapter Outline 230

Discussion Questions 236

Additional Discussion Questions 237

Additional Activities and Assignments 238

Case Study 1: How Implementing an HPWS Fortified the Snack-Food Maker Snyder‘s-Lance ................................................................................................................................12

Case Study 2: Whole Foods Market Faces Whole New Challenge.............................................13

Additional Resources 239 Cengage Video Resources 239

Purpose and Perspective of the Chapter

So you have finished reading 15 chapters on HRM. Congratulations textbooks do not always make for the most gripping reading. But before you close this book, ‗think about the following question: What is more difficult designing effective HR practices or implementing them as one system?

Most HR textbooks simply end after each individual aspect of HRM is introduced and explained. But in today‘s competitive environment, many organizations are discovering that it is how the pieces are combined together and put into practice that makes all the difference. After all, managers typically do not focus on staffing, training, and compensation practices in isolation from one another. These HR practices are implemented together as an overall system to enhance employee involvement and performance. So now that we have talked about the individual pieces, let‘s talk about how they fit together into . A high-performance work system (HPWS) is the combination of HR practices, work structures, and processes specific to a firm that maximizes the knowledge, skills, commitment, flexibility, and resilience of employees, which in turn enhances a firm‘s competitiveness.

Chapter Objectives

The following objectives are addressed in this chapter:

1. Discuss how a firm‘s strategy can be achieved using a high-performance work system and what its fundamental principles are.

2. Describe how a high-performance work system is designed, including the importance of horizontal and vertical alignment.

3 Recommend processes for implementing and evaluating a high-performance work system.

4 Discuss a high-performance work system‘s potential outcomes for both employees and the organization.

Key Terms

High-performance work system (HPWS): A specific combination of HR practices, work structures, and processes that maximizes knowledge, skill, commitment, flexibility, and resilience of a firm‘s employees.

Horizontal fit: The situation in which all the internal elements of the work system reinforce one another.

Process audit: Determining whether the high-performance work system has been implemented as designed.

Vertical fit: The situation in which the work system supports the organization‘s goals and strategies.

What's New in This Chapter

The following elements are improvements in this chapter from the previous edition: Chapter # New component(s)

Chapter 16 ● A look at how companies created remote work data access in response to the

COVID-19 pandemic.

Chapter 16 ● Edited and updated case study on Whole Foods‘ HPWS and the challenges the company faces sustaining it and regaining a competitive advantage.

Chapter Outline

The following outline organizes activities (including any existing discussion questions in PowerPoints or other supplements) and assessments by chapter (and therefore by topic), so that you can see how all the content relates to the topics covered in the text.

CO 16.1: Discuss how a firm’s strategy can be achieved using a high-performance work system and what its fundamental principles are.

A high-performance work system (HPWS) is a specific combination of HR practices, work structures, and processes that maximizes knowledge, skill, commitment, flexibility, and resilience of a firm’s employees. Figure 16.1

(Optional) Knowledge Check: <5 minutes total

Use Figure 16.1 to discuss the implementation of an HR strategy.

16.1. Fundamental Principles Figure 16.2

l. Four fundamental principles underlie a high-performance work system:

 Egalitarianism and engagement

 Shared information and trust

 Knowledge development

 Performance-reward linkage

(Optional) Knowledge Check: <5 minutes total Use Figure 16.2 to discuss the principles of high-performance work systems. Consider writing a definition of each element on the board.

ll. Major findings were identified in 92 studies of high-performance work systems:

 The systems have a larger influence on the performance of organizations than other highly visible governance practices.

 Because of their synergistic effects, the elements of the systems have a larger impact when they are implemented as a bundle.

 The systems have a significant effect regardless of whether the performance of firms is measured in operational terms or financial terms.

 High-performance work systems can be successfully implemented in all types and sizes of organizations.

16.1A. Egalitarianism and Engagement

l. Status and power differences separate people.

ll. More egalitarian work environments lessen status and power differences and increase collaboration and teamwork.

lll. Moving power downward empowerment requires structural changes.

iV. Workflows can be redesigned to give employees more control and influence over decision making.

V. Involving employees in decision making and giving them the power to act also tends to increase employee engagement.

16.1B. Shared Information and Trust

l. When employees are given timely information about business performance, plans, and strategies, they are more likely to make good suggestions for improving the business and to cooperate in major organizational changes.

ll. Shared information shifts organizations away from command and control toward employee commitment.

lll. It also shifts the relationship between employers and employees from one that is merely transactional to one that is more relational.

lV. Sharing key information with employees indicates you trust them and that your commitment to them is long term.

16.1C. Knowledge

Development

l. High-performance work systems depend on the shift from touch labor to knowledge work.

ll. Employees today need a broad range of technical, problem-solving, and interpersonal skills to work either individually or in teams on cutting-edge projects.

lll. When people are better informed, they do better work.

16.1D.

Performance-Reward Linkage

l. When companies reward their employees based on their performance, workers naturally pursue outcomes that are mutually beneficial to themselves and the, engagement, engaged employees

ll. Employees are more likely to go out of their way above and beyond the call of duty to make certain that their coworkers are getting the help they need, EOC (Optional) Discussion Question #1: 5 minutes total.

Discussion Activity 1

Do you think the fundamental principles of getting employees highly involved with their work provides an adequate context for designing high-performance work systems? What other concerns or guidelines for developing highperformance work systems would you suggest?

CO 16.2: Describe how a high-performance work system is designed, including the importance of horizontal and vertical alignment.

16.2. Designing High-Performance Work Systems

l. Because firms are different, their best practices are different.

ll. Some trends are similar.

Figure 16.3

16.2A.

(Optional) Knowledge Check: <5 minutes total

Use Figure 16.3 to discuss similarities in design aspects of highperformance work systems.

Work-Flow Design and Teamwork

l. High-performance work systems begin with the way work is designed.

ll. Reengineering, Lean Six Sigma, and similar programs have driven many organizations to redesign their work flows.

lll. In most cases, a ―homegrown‖ process and procedures work better than those adapted from elsewhere.

lV A common mistake is focusing on either top-down changes driven by executives or bottom-up changes cultivated by the employees.

V. The best results occur when managers and employees work together.

Vl. HR personnel need to be involved with the development of new procedures because they know what works in a firm, and their recruiting, evaluation, and rewards systems have an impact on how well high- performance work systems function.

.

16.2B.

Complementary Human Resources Policies and Practices

l. Employee performance and satisfaction are much higher when organizations combine their changes in work-flow design with HR practices that encourage skill development and employee involvement.

a. Staffing Practices

 Highly selective recruitment and selection practices help firms hire better personnel who have the skills they need.

 Human resources information systems have made it easier for firms to compile an inventory of their talent and search for employees with the specific skills they need

 Hiring pitfalls include simply looking for skills and experience in candidates and not looking for cues to see if they are truly engaged employees capable of contributing adequately to a high-performance work system

b. Training and Development

 Training focuses on ensuring that employees have the skills they need to assume greater responsibility.

 Managers can help employees develop to their full potential through training, crosstraining, and suggesting specific areas for improvement.

 Training helps to create a more egalitarian environment where employees are engaged and empowered.

 Training and development programs help to reinforce (at least) three of the four core principles of HPWFs.

c. Compensation and Benefits

 Because high-performance work systems ask for many different things from employees, one single approach to pay does not work for everyone.

 When decision making is pushed down to front-line roles, higher compensation is required because:

o higher pay attracts people with higher skills

o higher pay can be used to reward high performance.

 Other organizational incentives such as:

o gain sharing

o profit sharing

o employee ownership focus employee efforts on outcomes that benefit employees and the company.

 They incorporate skill-based pay plans to create a broader skill base and a more flexible pool of employees.

 More companies are connecting their firm’s corporate responsibility goals with their compensation systems

 Egalitarianism encourages employees to be more involved and committed.

 Open pay plans that allow employees to know what everyone else makes create an egalitarian environment.

 Other companies offer more flexibility and other work-life benefits.

d. Management Processes and Leadership

 With fewer layers of management and a focus on team-based organization, managers and supervisors are seen more as coaches.

 In many cases, leadership is shared among team members.

16.2C. Supportive Information Technologies

l. High-performance work systems cannot succeed without timely and accurate communications.

ll. Information needs to be about business plans and goals, unit and corporate operating results, incipient problems and opportunities, and competitive threats.

lll. During the COVID0-19 pandemic, virtually every organization scrambled to make certain that employees working remotely had access to the technology they needed

16.3. Strategic Alignment Figure 16.4

l. High-performance work systems need to fit together.

(Optional) Knowledge Check: <5 minutes total

Use Figure 16.4 to discuss horizontal and vertical fit when achieving strategic alignment.

16.3A. Ensuring Horizontal Fit

l. Horizontal fit occurs when all the internal elements of the work system reinforce one another.

ll. The synergy achieved makes a high-performance system effective.

16.3B. Establishing Vertical Fit

l. Vertical fit occurs when the work system supports the organization’s goals and strategies.

ll. High-performance work systems focus on a firm’s strategic priorities and link employee initiatives to their strategies.

16.3C. Assessing Strategic Alignment: The HR Scorecard

l. The HR Scorecard helps managers assess the strategic alignment of their work systems:

 Managers diagnose horizontal fit by assessing whether particular HR practices reinforce or conflict with one another.

 Managers assess the extent to which their HR practices result in employment stability and teamwork.

 The degree of vertical fit is evaluated by assessing the degree to which the results the workforce delivers are actually connected with the elements that help the firm excel.

EOC (Optional) Discussion Question #2: 5 minutes total.

Discussion Activity 2

Although achieving both horizontal and vertical fit are important for highperformance work systems, which do you consider more critical and why?

CO 16.3: Recommend processes for implementing and evaluating a highperformance work system.

16.4. Implementing the System Figure 6.5

l. The following actions are necessary for success:

 Make a compelling case for change linked to the company’s business strategy.

 Ensure that change is ―owned‖ by senior and line managers.

 Allocate sufficient resources and support for the change effort.

 Ensure early and broad communication of the effort.

 Ensure that teams are implemented in a systemic way.

 Establish methods for measuring the results of the change.

 Ensure continuity of leadership and appoint ―champions‖ of the initiative. (Optional) Knowledge Check: <5 minutes total

Use Figure 16.5 to discuss how to implement a high-performance work system. Ask students how the actions needed for success fit into the process.

EOC (Optional) Discussion Question #3: 5 minutes total.

Discussion Activity 3

This chapter emphasizes the processes required to implement a highperformance work system. What are the most critical steps to successfully implementing one?

Instructor Manual: Snell/Morris, Managing Human Resources 19e, c23, ISBN: 9780357716519; Chapter #1: The Opportunities and Challenges of

16.4A. Building a Business Case for Change and Engaging Stakeholders Figure 6.6

l. It is important to build a bridge with the firm’s stakeholders such as its employees, the unions it works with, and other groups when implementing a high-performance work system.

ll. Show the groups where the business is today and where it needs to be in the future.

lll. Some studies show that unions can be a barrier.

lV. To help get unions on board, create a win-win situation.

16.4B. Establishing a Communications Plan

l. Building support is easier if a top manager champions or promotes the system.

ll. Employees should be confident that the CEO and senior managers are intimately involved and committed to the change.

lll. Two-way communication is needed to diminish employees’ fear when facing changes.

a. Navigating the Transition to High-Performance Work Systems

 Different organizations implement high-performance work systems in different ways.

 In start-up firms, managers can put everything in place at once.

 Not every organization has the luxury of suspending operations while changes are put in place.

 When organizations have to be retrofitted, the process can be cumbersome.

 Establishing an implementation plan that provides a timetable for redesigning the work flow and training employees can keep the effort from bogging down.

b. Adhering to New Procedures

 Following the new procedures is often the hardest part of the job.

 HR managers can help employees in transition handle the changes they are going through.

16.4C. Evaluating and Sustaining the Success of the System

l. A process audit is determining whether the high-performance work system has been implemented as designed.

ll. Employee-related questions might be included in the audit.

lll. High-performance work systems should be periodically reevaluated in terms of new organizational priorities and initiatives.

CO 16.4: Discuss a high-performance work system’s potential outcomes for both employees and the organization.

16.5. Outcomes of High-Performance Work Systems

l Outcomes from high-performance work systems can be categorized as employee concerns or competitive challenges.

16.5A. Employee Outcomes and Quality of Work Life

l. High-performance work systems offer employees many potential benefits.

ll. Because employees are more informed and have more latitude to decide how to achieve their goals, they are likely to feel they have a bigger role to play and that their opinions and expertise are valued more.

ll. As a result, they find their career-growth needs are being met and are more satisfied.

lV. Many benefits relate to the intrinsic motivation of work that is more interesting and engaging, leading to higher quality of work life.

V. When employees are underutilized, the performance of an organization suffers, and employees develop poor work attitudes and habits.

16.5B. Organizational Outcomes and Competitive Advantage

l. Organizational outcomes include the following: greater innovation for a firm, greater flexibility, higher productivity, lower costs, better responsiveness to customers, and higher revenues and profits.

ll. Organizations can create a sustainable competitive advantage through people if they focus on four criteria:

 Valuable

 Rare

 Difficult to imitate

 Organized

EOC (Optional) Discussion Question #4: 5 minutes total.

Discussion Activity 4

Do high-performance work systems always result in a win-win situation for employers and their employees? Why or why not?

Discussion Questions

1. Question: Do you think the fundamental principles of getting employees highly involved with their work provides an adequate context for designing high-performance work systems? What other concerns or guidelines for developing high-performance work systems would you suggest?

Suggested answer: The four principles of high involvement are certainly broad enough to cover many of the people issues underlying HPWS. However, they do not necessarily cover all of the organizational and administrative issues that also accompany such systems. For example, the linkage of vertical and horizontal fit to strategy are not included in the four principles, nor is the idea of organizational flexibility. Ultimately, for HPWS to function effectively, the underlying principles have to say as much about the organization’s structures and systems as they do about people. Students’ suggestions will vary.

2 Question: Although achieving both horizontal and vertical fit are important for highperformance work systems, which do you consider more critical and why?

Suggested answer: This may seem to be an impossible question to answer since both types of fit are necessary. If everything is aligned internally but not connected to strategy, performance will be focused in a direction that does not support the overall goals of the organization. On the other hand, it is virtually impossible to link HPWS externally unless the pieces are first internally aligned with each other. So in this sense, we can say that horizontal fit is a necessary but insufficient condition for achieving a vertical fit.

3 Question: This chapter emphasizes the processes required to implement a highperformance work system. What are the most critical steps to successfully implementing one?

Suggested answer: The following actions are necessary for success:

 Make a compelling case for change linked to the company’s business strategy.

 Ensure that change is ―owned‖ by senior and line managers.

 Allocate sufficient resources and support for the change effort.

 Ensure early and broad communication of the effort.

 Ensure that teams are implemented in a systemic way.

 Establish methods for measuring the results of the change.

 Ensure continuity of leadership and appoint ―champions‖ of the initiative.

4. Question: Do high-performance work systems always result in a win-win situation for employers and their employees? Why or why not?

Suggested answer: In the long run, employee-centered and organizational-centered outcomes have to support one another. If employees do not get what they need, they cannot contribute effectively to the organization. Alternatively, if strategic objectives are not met, the organization will cease to exist, and employees will have to find work elsewhere. The idea is simple, and, as said at the beginning of Chapter 1, without people, organizations would not exist.

Additional Discussion Questions

The following are discussion questions that do not appear in the text, PPTs, or courseware (if courseware exists) – they are for you to use as you wish. You can assign these questions several ways: in a discussion forum in your LMS; as whole-class discussions in person; or as a partner or group activity in class.

5. Question: Explain how high-performance work systems create a sustainable competitive advantage.

Suggested answer: Organizations can create a sustainable competitive advantage through people if they focus on four criteria. The same criteria hold for highperformance work systems:

• Valuable: High-performance work systems increase value by establishing ways to increase innovation and efficiency, decrease costs, improve processes, and provide something unique

to customers.

• Rare: High-performance work systems help organizations develop and harness skills, knowledge, and abilities that are not equally available to all organizations.

• Difficult to imitate: High-performance work systems are designed around team processes and capabilities that cannot be transported, duplicated, or copied by rival firms.

• Organized: High-performance work systems combine the talents of employees and rapidly deploy them in new assignments with maximum flexibility.

Additional Activities and Assignments

The following are activities and assignments developed by Cengage but not included in the text, CPPTs, or courseware (if courseware exists) – they are for you to use if you wish.

Internet Activity: Egalitarianism and Engagement

At the Swedish-based company IKEA, hierarchical differences aren‘t prominent, in part because egalitarianism is a Swedish value. Employees are on a first-name basis and sit side-by-side at IKEA desks in an open-floor arrangement with their managers. Few managers even have business cards. Go to the IKEA website and research the effectiveness of this strategy. Report your findings to the class.

https://www.icmrindia.org/casestudies/catalogue/Human%20Resource%20and%20Organization %20Behavior/Ikea%20Innovative%20Human%20Resource%20Management-Work%20CultureCase%20Studies.htmReport your findings to the class

Case Study 1: How Implementing an HPWS Fortified the SnackFood Maker Snyder’s-Lance

1. Question: Identify how Synder‘s-Lance engages its employees.

Suggested answer: Snyder’s-Lance’s work culture is based on total employee involvement. The employees were required to undergo cross-training that covered the firm’s largest production line, which gave every employee an opportunity to understand different functions and roles in the company. They believe in empowering employees at an individual level with the help of leaders who ensure that they are taking care of their teams.

2. Question: Why might it be more effective to implement an entire new system like an HPWS rather than make incremental changes at a production facility like the one in Charlotte? Couldn‘t the large-scale changes create chaos in a plant its size?

Suggested answer: 2. Piecemeal approaches would not have worked well because Flickinger was looking for sustained improvements in the plant. If there was no proper Plan in place, implementing an entirely new system like an HPWS could have resulted in a chaotic situation because nearly 1,000 employees were producing more than 500 types of products. To avoid this, a vision was defined that then shaped the foundation of a formal but very simple and direct mission: ―Take care of your people and deliver your numbers,‖ which could be translated to something very real. Also a line leader was

assigned to each line who was responsible for the full value stream of output being produced on it, which created a single point of accountability.

Case Study 2: Whole Foods Market Faces Whole New Challenge

1. Question: Why don‘t all companies treat their employees like Whole Foods does? Are there downsides of doing so?

Suggested answer: Managers may resist HPWS because it appears to be a threat to their old ways (power relationships, routines, and so on). But today’s organizational dynamics are changing and becoming more team-oriented, egalitarian, and global. People are becoming the great differentiating factor in terms of how firms set themselves apart and compete. In the future, more firms are likely to recognize the success of companies like Whole Foods and rethink how they do business. Downsides could include cost.

2. Question: Do you think Whole Foods will have to change its HR practices to better compete? Are the practices no longer vertically or horizontally aligned with the firm‘s strategy? Or does the firm‘s strategy need to change?

Suggested answer: Student answers will vary. This is an opinion question.

Additional Resources

Cengage Video Resources

 MindTap Videos:

o Chapter 16: On The Job: Intermountain High Performance Teams