7-Human Resource Management

ENTREPRENEUSHIP
1. 2. 3. 4. 5. Mohd Firdaus Bin Razak Muhammad Asyraf Bin Azmi Amir Syazzuan Bin Omar Mohd Sabri Bin Salem Zaid Iqram Syakir Bin Mazlan
Basic Entrepreneurship (ENT028)
MODULE 7
HUMAN RESOURCE MANAGEMENT
HUMAN RESOURCE MANAGEMENT

Introduction Human Resource Planning Job Analysis Recruitment and Selection Training and Employee Development Compensation and Benefits Performance Management Industrial Relations and Employment Laws Occupational Safety and Health Summary
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Introduction

The most challenging and critical resource that need to be managed is human resource (HR). Human Resource Management (HRM) is the design of formal systems in an organization to ensure effective and efficient use of human talent to accomplish organizational goals HRM includes: 1. HR Planning 2. Job Analysis 3. Recruitment and Selection 4. Training and Employee Development 5. Compensation and Benefits 6. Performance Management 7. Industrial Relations and Employment Laws 8. Occupational Safety and Health
HR Planning
HR planning refers to the forecasting on HR needs in the context of strategic business planning Forecasting of HR needs requires entrepreneurs to determine the demand for and supply of human resources for bot short and long-term planning.
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HR Planning
HR planning process
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HR Planning
Forecasting Personnel Needs
Trend Analysis Ration Analysis Computer Forecasting
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HR Planning
Setting and Strategies Planning
Options for Reducing an Expected Labor Surplus and Avoiding an Unexpected Labor Shortage
Options
Expected Labor Surplus
Downsizing Pay Reduction Demotions Transfers Work Sharing Hiring Freeze Early Retirement Natural Attrition Retraining

Expected Labor Shortage

Overtime Temporary Employees Outsourcing and Off shoring Retrained transfers Turnover Reductions New External Hires Technological Innovations
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Job Analysis
Job Analysis is the process of gathering information about the job The information are:

Job activities The duties Responsibilities Scope Work environment Person behaviour Person characteristics
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Job Analysis
Steps in Job Analysis

Step 1 Select Job to be Analysed
Step 2 Collect Data Using Job Analysis Method
Step 3 Prepare Job Description and Job Specification
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Job Analysis
Methods and Sources of Job Analysis
Interview
Face to face meeting

Getting information from specific informant Questionnaires Done employees performing the job
Observation
Directly observing employees performing the job and writing down all the job activities performed
Job analysis helps to perform other HR functions such as recruitment and selection, training, performance appraisal and compensation
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Recruitment and Selection

Recruitment is the process of attracting the right candidate with the right skill and behavior to apply for the position
Selection is a process of choosing the best candidate for the job
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Types and Sources of Recruitment

Internal
External
Getting potential employees from within the organization Methods of Recruitment

Job posting and job bidding Internal mails Memos
Getting potential employees from outside the organization such as vocational school, secondary school, universities, labour unions, competitors, labour office and employment agencies. Methods of Recruitment:

Career fair Engaging employment agencies Advertisement in major mass media Advertising in firms websites and internet Advertising in recruitment agencies websites. Headhunters Employee referrals Walk-in
Promotion from within
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Selection

Selection is the process of choosing the best candidate for the job Steps in selection process
Receive application form Review of application form Selection test Employment interviews Background and references checks Selection decision Medical examination Employ individual
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4 Training and Employee Development

Employee Orientation Training Process Training Techniques Employee Development
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Employee Orientation
Providing new employees with the information about the company departments in which they will be working and community they will be with throughout their tenure Contents (Examples):
Company vision Company mission Goal Company history Language Performance proficiency Rules and regulations
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Advantages to the new employees:
Feel welcome and accepted Appreciate the companys culture and values Understand the jobs requirements demand and performance expectation
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Three Stages of Orientation Programme:
A general introduction to the organization A specific orientation to the department and their job A follow-up meeting
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Training Process
A planned effort to improve employee performance

Training Process
Six steps of training design process
Step 1
Step 2 Step 3
Needs Assessment
Employees Readiness for Training Plan Training Programme
Step 4
Step 5 Step 6
Ensure Transfer of Training

Select Training Methods and Implement the Programme Evaluate Training Programmes
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Employee Development

Formal Education Assessment
Job Experience
Interpersonal Relationships
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Compensation and Benefits

Compensation is any kind of rewards whether tangible or intangible for services rendered
Tangible rewards
o
Direct monetary rewards Salary, wages, bonus, commission, shares and overtime claims
Indirect monetary rewards Mandated or non-mandated benefits such as EPF, SOCSO, annual leaves, maternity leaves, medical leaves, loans and scholarships.
Intangible rewards
o
Non-monetary rewards Conducive working environment, management support, recognition, empowerment and supervision
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Equity Compensation
Compensation system that is acceptable and effective that is perceived by employees as fair.
To make ensure fairness, equity must have:
Internal
External
Individual
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Compensation and benefits assist in:
Attracting the best candidate in the market to work for the organization
Motivating employees to achieve productivity
Improving employees satisfaction
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Performance Management
Performance management: Is a system that aims to maximize the potential, competency and performance of the employees. Is done through a continuous process of communicating, coaching, motivating, training, feedback, evaluating and reviewing employees performance Is a dynamic, on-going and continuous process
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Performance management also is defined as a process by which executives, managers and supervisors work to align employees performance with the organizations goals. Performance management cycle:
Performance Planning
Rewarding Performance
Performance Management Cycle
Managing Performance
Reviewing and Evaluating Performance
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Performance management: Is a system that aims to maximize the potential, competency and performance of the employees. Is done through a continuous process of communicating, coaching, motivating, training, feedback, evaluating and reviewing employees performance Is a dynamic, on-going and continuous process
Purpose of Performance management: To meet strategic, administrative and developmental purpose of the organization.
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Performance Appraisal
Performance Appraisal: Is a system It is a process of evaluating employees current and/or past performance relative to his or her performance standards. It involves setting work standard, assessing employee actual performance relative to these standards, and providing feedback to the employees with the aim of motivating or eliminating their performance deficiencies. By evaluating employees performance, the organization is able to determine the level of its employees performance and allows to make administrative and developmental decisions.
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Performance appraisal is conducted by:
Immediate supervisors
Peer
Employee himself or herself Committee Multisource
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Performance appraisal methods:
Category rating
Comparative Narrative Behavioural or objective
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Rater Error
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Industrial Relations and Employment Laws

Refers to the relationship between employees and their employers The three most important laws are:

Industrial Relations Act 1967 (IRA) The Trade Union Act 1959 (TUA) Employment Act 1955 (EA)
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Industrial Relations and Employment Laws

Refers to the relationship between employees and their employers The three most important laws are:

Industrial Relations Act 1967 (IRA) The Trade Union Act 1959 (TUA) Employment Act 1955 (EA)
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Employment Act 1955 (EA)
An employee shall not be required to work:

More than five consecutive hours without a break of not less than 30 minutes More than eight hours in one day More than 48 hours in one week
Employee is entitled to at least one rest day per week. Employee is entitled to a minimum of 10 paid public holidays in Peninsular Malaysia, 14 days in Sabah and 16 days in Sarawak. Annual leave after 12 months of continuous services as follows:

Eight days for employment of less than two years 12 days for employment of between 2 and 5 years. 16 days for employment of more than 5 years 14 days for employment of less than two years 18 days for employment of between 2 and 5 years. 20 days for employment of more than 5 years
No hospitalization paid leave as follows:

Hospitalization paid leave of 60 days in the aggregate. 60 days paid maternity leave for female employees
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Occupational Safety and Health

Occupational, Safety and Health Act 1994 (OSHA) The aim is to promote safety and health awareness, and establish effective safety organization and performance OSHA will help create a healthy and safe working environment Implementing OSHA helps to:
avoid accidents at workplace avoid costly medical related expenses minimize employees and their families physiology and psychological distress Avoid severe legal implication
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Occupational Safety and Health
Duties of the entrepreneurs to their employees are:
Ensure, so far as is practical, the safety, health and welfare at work of all their employees.
Make arrangements for safety and absence of risk to health in the use of plant and substances. Provide information, instructions, training and supervision to ensure safety and health. Maintain place of work and working environment to ensure safety and without risk to health.
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Summary
Entrepreneurs need to understand and be able to apply the functions of HRM effectively. Functions of HRM include: Human Resource Planning Job Analysis Recruitment and Selection Training and Employee Development Compensation and Benefits Performance Management Industrial Relations and Employment Laws Occupational Safety and Health
May 2013

7-Human Resource Management

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ENTREPRENEUSHIP

Basic Entrepreneurship (ENT028)

HUMAN RESOURCE MANAGEMENT

Basic Entrepreneurship (ENT028)

HUMAN RESOURCE MANAGEMENT

Basic Entrepreneurship (ENT028)

Basic Entrepreneurship (ENT028)

Basic Entrepreneurship (ENT028)

Forecasting Personnel Needs

Trend Analysis Ration Analysis Computer Forecasting

Basic Entrepreneurship (ENT028)

Setting and Strategies Planning

Expected Labor Shortage

Basic Entrepreneurship (ENT028)

Steps in Job Analysis

Step 2 Collect Data Using Job Analysis Method

Step 3 Prepare Job Description and Job Specification

Basic Entrepreneurship (ENT028)

Methods and Sources of Job Analysis

Face to face meeting

Recruitment and Selection

Basic Entrepreneurship (ENT028)

Types and Sources of Recruitment

Getting potential employees from within the organization Methods of Recruitment

Job posting and job bidding Internal mails Memos

Promotion from within

Basic Entrepreneurship (ENT028)

Basic Entrepreneurship (ENT028)

4 Training and Employee Development

Employee Orientation Training Process Training Techniques Employee Development

Basic Entrepreneurship (ENT028)

Advantages to the new employees:

Basic Entrepreneurship (ENT028)

Three Stages of Orientation Programme:

Basic Entrepreneurship (ENT028)

A planned effort to improve employee performance

Ensure Transfer of Training

Basic Entrepreneurship (ENT028)

Formal Education Assessment

Basic Entrepreneurship (ENT028)

Compensation and Benefits

Basic Entrepreneurship (ENT028)

Compensation and Benefits

Basic Entrepreneurship (ENT028)

Compensation and Benefits

Compensation and benefits assist in:

Improving employees satisfaction

Basic Entrepreneurship (ENT028)

Basic Entrepreneurship (ENT028)

Performance Management Cycle

Reviewing and Evaluating Performance

Basic Entrepreneurship (ENT028)

Basic Entrepreneurship (ENT028)

Basic Entrepreneurship (ENT028)

Performance appraisal is conducted by:

Basic Entrepreneurship (ENT028)

Performance appraisal methods:

Basic Entrepreneurship (ENT028)

Basic Entrepreneurship (ENT028)

Industrial Relations and Employment Laws

Basic Entrepreneurship (ENT028)

Industrial Relations and Employment Laws

Basic Entrepreneurship (ENT028)

Employment Act 1955 (EA)