Free «Human Resource Management: Personnel Management» Essay Paper

Human Resource Management: Personnel Management

1.1. Personnel management recognizes that an organization has personnel that should be managed properly. Human resource management goes a little further and sees personnel as not simply people, but an important organizational resource and concentrates on the management of this resource to bring maximal advantage for the company. Personnel management differs greatly from human resources management:

  1. There is a reorientation of the personnel management system to the individual work with HR;
  2. HR management has a strategic measurement, which makes the personnel policy of the organization more active;
  3. The responsibility for the realization of more active personnel policy is put on line managers; it means that the personnel’s work of all links managers is integrated into the system of personnel management;
  4. The traditional personnel management aspires to economy the expenditures connected with the reproduction of the working power, while HR technology is aimed at increasing the efficiency of human resources;
  5. The activity of personnel management is focused on ordinary workers only, while HR management is concentrated on staff management;
  6. A new system of personnel management assumes strong and adaptive corporate culture.

1.2. The main purposes of ShakeAway include the franchising of their brand for their further development. Thus, the HR department should recruit and motivate personnel to achieve successful results in franchising. The motivation of the personnel, occupied with the realization of the franchising strategy, should provide the most effective use of human resources and put proper priorities for each worker (ShakeAway 2014). Monitoring and controlling system of each worker should be built in a way to exclude the system of external control. However, each worker can be controlled by the other employee, using the principle close to the one of the division of powers, providing system of self-stabilization. In order to achieve this, HR department should separate the responsibility and control zones, as well as create a bonus system for each employee. In this case, the controlling functions will be fulfilled by financially uninterested and independent employees.

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1.3. Line managers play a crucial role in the success of policy and practice in the sphere of human resources. Line managers perform management of departments and/or production sites. Line managers submit to top managers and manage workers. The main objective of a line manager is to combine the purposes of employees and the company. Line managers are responsible for the work of a group in front of higher officials in the administrative hierarchy. As a rule, workers who do not fulfil administrative or leading duties are under their supervision and are responsible for daily performance of work but not for strategic questions. The following kinds of activity in this or that combination belong to the duties of link managers: management of people; management of production expenses; implementation of technical expertise; organizational activity (planning of distribution of work and labor); monitoring of working processes; quality check; communication with buyers and clients; measurement of production activity’s quality (McMullen & Stark 2008).

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The research conducted by Juan López-Cotarelo (2012) shows that line managers are not able to motivate people and increase the quality of their work. One of the most important tasks of HR department is to support line managers in management and development of their employees; it means to understand the corresponding functions of HR managers and line manager.

2.1. Starting the work on planning personnel’s needs, it is necessary to understand that it is the whole system of complex decisions having specific goals. The main problem of planning is to have the personnel of the necessary qualification in the right place and in due time for the performance of the corresponding work. The main objectives of HR planning include provision of the organization with human resources in the set terms, having minimized all expenditures and organization of effective work on hiring (completing) and to development (training) of the personnel. According to Kleiman (2003):

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The process of the HR planning begins with considering the organizational objectives and strategies. Then both external and internal assessments of HR needs and supply sources must be done and forecasts developed. Key to assessing internal human resources is having solid information, which is accessible through a human resource information system (HRIS).

There are two types of HR planning:

  1. Strategic (long-term);
  2. Tactical (situational).

At strategic planning, the program for identifying potential of experts important for the organization is formed. The strategy of development of human resources is worked on, and the need for these resources is further defined. At tactical planning, the need of the organization for the personnel for the definite period (month, quarter) is analyzed. It depends on the indicators of turnover of staff at present, retirements, maternity leaves, reductions, etc. When planning the personnel, it is necessary to consider the dynamics of the market and the competition in this branch; the level of compensation of employees and internal culture of the organization. It is possible to classify the planning period as follows:

  • Short-term (up to 2 years)
  • Medium-term (from 2 to 5 years)
  • Long-term (more than 5 years).

2.2. Strategic planning has six main stages. The first two components (the external and internal analysis) help the organization to define what the company “is” now. The third component (vision and mission) helps the organization to define what “should be”. The last three components (goal setting, development of the action plan and an assessment of results) help the organization to decide what should be done to move from the state “is” to the state “should be”.

  • Internal analysis. It helps the organization to define its current resources (physical, financial, human, etc.), and to define when these resources can be strong and weak sides of the organization;
  • External analysis. It allows an organization to understand what occurs around, how it can affect the expected events and how they can be transferred to organization’s threats and opportunities.
  • Vision and mission. Vision and mission compose the purpose of the strategic planning. Defining “the desirable future”, an organization can start developing the plan of special actions for the implementation of the desirable future.
  • Strategic objectives. The process of allocation of main objectives forces the organization to define those actions which will be critical for the transformation of the desirable future into reality. These purposes are widely set (for example, to improve customer service) and reflect what should be done, but not how it should be done.
  • Plan of action. It offers the special tasks necessary for the achievement of definite purposes, and determines performance terms together with the responsibility for performing these tasks.
  • Assessment of results. Organization’s strategic plan should be a document, reflecting the organization’s external image, its purposes, plans, priorities and progress.

2.3. There are two sources of personnel recruitment and selection: internal – at the expense of employees of the same organization, and external – at the expense of the external environment resources. The recruitment process in ShakeAway has specific features. The company uses the external sources, such as shifts within the company, governmental recruitment agencies, contacts with higher educational establishments, advertisements in mass media. Speaking of the recruitment process in Barclays bank, it is important to mention that the bank uses the method of headhunting. The principle of this method includes the long detailed analysis of the market and possible companies – donors. The advantages of headhunting include an impact on the necessary target audience; the top management of the bank is ready to consider offers on new work, lets headhunters know about their intentions, but does not openly look for work in the competing organizations; if the chosen candidate does not want to change a working place, a headhunter can recommend another worker of a similar level.

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3.1. The motivational theory and reward are closely connected between each other. The notion of motivation has two meanings, namely:

  • As a system of factors causing activity of an organism and defining an orientation of human behavior, including requirements, motives, intentions, purposes, interests and aspirations;
  • As the characteristic of the process providing behavioral activity at a certain level - motivation.

The expectations concerning results – rewards - are expectations of a certain remuneration or encouragement in response to the achieved level of results. If there are no interrelations between the achieved result and the expected reward, the motivation is weakened. If a person is certain that the achieved results will be rewarded, but at reasonable expense of efforts he/she cannot achieve it, the motivation will be weakened. As the requirements and wishes of different people concerning remuneration differ, a definite remuneration offered in reply for the achieved results cannot have any value for them (Hewett 2013).

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If the value of any of the above-mentioned factors is little, there will be a weak motivation, and work results will be low. Valency is the estimated degree of a relative satisfaction or dissatisfaction arising due to receiving a certain remuneration. In order to make a person motivated for a certain activity, it is necessary to reward his achievements in the activity that he/she appreciates, and remuneration should be connected with the achievement of the purpose for the person to notice it.

3.2. In the conditions of the market economy, the size of a salary is influenced by a number of market and non-market factors. Therefore, there is a certain level of compensation. The decrease of a demand on a commodity market and services leads to the reduction of the volumes of release, and, consequently, to the decline in demand for the used resource of work and deterioration of the terms of employment. On the contrary, the increase of demand for goods and services can lead to the increase in demand for work and increase of salary rates.

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The factors, determining pay, are subdivided into marketing factors and non-marketing factors. Marketing factors include demand and supply, resource profitability, elasticity of demand for work in cost, resources interchangeability, changes of prices for consumer goods and services. Non-marketing factors include the measures of governmental regulation of salaries, ratio between trade unions and employers, final results of a company’s activity and personal working contribution of each employee (Galuščák et al. 2010).

3.3. At present, an effective reward system is an effective scheme of compensation and transparent scheme of its calculation compose an important stimulating factor for the qualified staff of the companies. There are two main forms of a salary:

  • Piece work, at which earnings depend on the quantity of the made units of production, taking into account their quality, complexity and working conditions;
  • Time, at which the size of earnings depends on actual hours worked and a tariff rate (salary).

Besides, there is an incentive (additional) payment done when the employee exceeded the standard working norm. The variable salary is also not continuous remuneration and is paid for the results of work of the department or enterprise in general. The combined reward system is the most effective, since it guarantees a certain financial basis which allows an employee to predict the minimum income.

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There are two complex indicators, which can be applied for the creation of effective reward system: 1. Individual Performance Factor (IPF), which represents the generalizing quantitative assessment of a personal labor contribution of each worker to the end results of work of a group of workers and the whole enterprise. 2. Wage rate scale, representing a scale, which defines a ratio in compensation for the employees of various qualifications.

3.4. Traditionally, the activity of employees is estimated from several points of view - by the achieved results, performance of functions (activity attestation), professional potential (personal and business qualities). The most effective methods for monitoring employees’ performance include:

  • Testing - determination of professional knowledge and skills, abilities and motives, psychology of a person by means of special tests;
  • Observation over the assessed employee is conducted in an informal environment or in a working situation by the methods of moment observation and “photos of the working day”;
  • Rating – an assessment of the compliance of an employee with the occupied position. The list of tasks necessary for its fulfillment is the main component of this assessment method. The results of all participating employees is compared and resulted in a rating;
  • Self-assessment includes self-estimation of an employee by the special criteria (Kehr 2004).

4.1. The employment in ShakeAway can be terminated due to the reasons, such as agreement of the parties; expiration of the employment agreement, except for cases when the labor relations actually proceed and any of the parties did not demand their termination; cancellation of the employment contract at the worker’s initiative; cancellation of the employment contract at the initiative of the employer; transition of the worker at his request or from his consent to work for the other employer or transition to elective work (position).

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4.2. The employment exit procedures are the same, both for ShakeAway and a large corporation like Barclays bank. The termination of the employment contract is made out by the order of the employer. The worker should sign the document, stating he understands the termination of the employment contract with him. By the request of the employee an employer is obliged to issue a properly certified copy of the specified order for him. The day of employment contract termination is the last day of work of the employee, except for cases when the employee did not work.

4.3. All activities of HR department should be conducted within the legal and regulatory framework. They include the following sources: general legislation, international legislation, legislation monitoring, draft laws and comments to them, legal precedents, state authorities, regional and capital legislature, financial information of the company, typical agreements and patterns, legal reference books, etc.

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