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CHAPTER 16 - HUMAN RESOURCE MANAGEMENT STRATEGY, BENEFITS OF FLEXITIME …

- - - - An employment contract that is for a complete working week
    - - a contract that employs a worker unless they are dismissed, redundant or decide to leave the organisation
    - - DISADVANTAGES =
        01 - labour costs become fixed costs as they cannot easily be varied with output or demand for the products of the buinsess
        02 - the contracts are inflexible as tehy do not employers to vary the number of hours they work quickly
      - ADVANTAGES AND DISADVANTAGES OF FULL-TIME AND PERMANENT EMPLOYMENT CONTRACTS FOR BUSINESSES
  - - - 03 - ZERO HOURS CONTRACT
        
        04 - GIG ECONOMY
        
        an employment mix in which temporary, flexible jobs are common and workers are hired as independent contractors or freelance employees
        
        an employment contract that does not guarantee a minimum number of hours per week, but the worker is expected to be available for work when called by the employer
      - workers are only contracted to work for a certain number of hours each week which is less than the wokring week
  - - - DISADVANTAGES TO TEMPORARY PART-TIME/ ZERO HOURS/ GIG CONTRACTS TO EMPLOYEES
        01 - Part time pay will be less than on a full time contract
        02 - security of employment will these contracts will be than for permanent workers
        03 - other working conditions are often inferior to those of full time permanent employees - ex --> holiday entitlement or pension right in many countries the law does not give as many employment rights to part-time, temporary workers as to full-time workers
        04 - there may be fewer training opportunities than those offered to full-time/ permanent workers
  - - - 02 - FLEXITIME ARRANGMENTS
        
        03- HOMEWORKING
        
        04 - ANNUALISED HOURS WORKING
        
        05 - JOB SHARING
        
        06 - COMPRESSED WORKING HOURS
        
        the number of hours per week of a full-time job but worked in fewer days
        ex - (4/10: 4 days for 10 hours per day)
        
        1 more item...
        
        07 - SHIFT WORK
        
        1 more item...
        
        a work schedule in which two employees voluntarily share the responsibilites of one full time job, they receive a salary and beenfits on a pro-rata basis
        
        BENEFITS OF JOB SHARING
        01 - employees can cover for each other in case of illness
        02- worker may be more productive (being less tired and stressed) when they do work
        03 - the business is able to keep two experienced workers per job role
        
        04 - workers have greater work-life balance
        05- offer sometime for family commitment
        
        1 more item...
        
        a contract offering specific number of hours of work over the whole year, but with some flexibile about when those hours are worked
        
        BENEFITS OF ANNUALISED HOURS CONTRACT -
        01 - a period of regular hours or shift forms the core of the arrangement, with the remaining time left unallocated and used for when needed
        02 - offers employees more flexbility for planning other activites
        03 - more flexbile for employers as they can call in workers as or when they are needed
        
        LIMITATIONS OF ANNUALISED HOURS CONTRACTS
        01 - workers may have less freedom if they are called in at very early notice
        02 - if annual hours are used up before the end of the year, high cost overtime may have to be offered
        
        when an employee works from home, often for a specific number of weeks often for uses tele-networking to keep contact with the office
        
        BENEFITS OF HOMEWORKING
        01 - This suits many employees who have a long journey to work
        02 - it reduces time wasted in travel
        03 - it reduces business costs for accomofating all employees at one time
        04 - employees can share desks and workstations called hot-desking
        05 - it is eassier to recruit good quality employees
        
        DISADVANTAGES TO HOME WORKING
        1 - it is difficult to assess employee performance when working from home
        02 - no face-to-face contact is possible during working days
        03- the employee has less social contact
        04 teamworking become more diffucult
        
        a flexible way of working that allows employees to fit their working hours around their individual needs, and to accomodate other commitment outside of work
      - a contract that allows employees more control over their work life balance including option to work from home, flexible start and finish times and to work part time or job share
  - - - ABSENTEEISM
        
        A MEASURE OF THE RATE OF WORKFORCE ABSENCE AS A PROPORTION OF THE EMPLOYEE TOTAL
        
        FORMULA FOR ABSENTEEISM = NUMBER OF WORKDAYS OF EMPLOYEES ABSENCE / TOTAL OF WORKDAYS X 100
        
        EX --> last week a business recorded 225 days of employees absence - it employees 100 workers on 5-day a week full time contracts
        
        so the absenteeism for last week is = 225/5000 x 100 = 4.5%
        01 - Absenteeism can also be measured by expressing the average daily number of workers absent as a proportion of the number of workers
        02 - alternative absenteeism can be calculated for each individual employee as well
        03 - employee absenteeism can also be measure by expressing the average daily number of workers absent as a proportion of the number of workers
        04 - employee absenteeism is disruptive for all businesses, especially those in the service industries
        05 - these services cannot be held as inventory for the use during periods of absence
        
        once a customer has received a poor serice due to a worker being absent there is a high chance that the customer will never return
        
        07 - it is expensive to employ extra people just to cover for absent employees or to ask workers to work overtime
        08 - absenteeism is an indicator of motivation
        09 - a very - well focused staff who is motivated will avoiding missing days off work at all costs
        10 - in contrast, it is possible that Herzberg's factor of the job might contribute to high absenteeism
        ex ---> poor working conditiions might lead to illness or over supervision could lead to worker stress
        11 - days off work could be be a consequence of either problem
        12 - for absenteeism to be an effective measure of employee performance, it is important for HRM to investigate the cause of absence
        13 - it the absences results from poor health or family problems - then HRM may be supportive and offer appropriate help
        14 - however if it is discovered that absenteeism is due to laziness or employee having a second job then disciplinary action is required
      - 01 LABOUR PRODUCTIVITY
        -1 - most managers feel like labour productivity is the key test of employee performance
        -2- if output increases overtime then labour productivity is also rising
        
        3 - it means that the constant wage rates, labour costs and per unit cost are falling
        
        4- this is therefore a major factor influencing the competitiveness of the business
        
        -5- to assess the employees performance, productive results are usually compared with the data of other employees or other businesses in the same industry over time
        
        6- there are several reasons why labour productivity might increase over time:
        
        a)- improved employee motivation levels and higher levels of effort
        b) - more capital equipent is invested into such as automated robots
        c) - better employee training
        d ) - increased worker involvement in problem-solving to speed up the methods of production
        e) - improved operations efficiency (ex --> no waiting for new supplies or materials to arrive).
        
        7 - measuring productivity in service industries is ususally more complex than in manufacturing or primary sectory industries
        
        examples-
        
        a- TRANSPORT INDUSTRY- kilometres travelled per driver each year
        b - HOTELS - number of guest nights per employee per year
        c - IT AND BANKING - revenue earned on average per year
        
        8- it can be difficult to increase productivity in service industries
        
        9 - in the case of luxury hotels, for ex ---> top quality services for guests depend upon having staff permanently on call
        
        this means the prices in the hotel industry have not fallen as they have for consumer electronics products
        
        one way in which a hotel owner could improve labour productivity would be to use IT as much as possible in support services of booking,billing and ordering supplies
        
        FORMULA FOR LABOUR PRODUCTIVITY = TOTAL OUTPUT / TOTAL LABOUR INPUT
  - - - there is no single solution to a problem of poor employee performance
        
        02 - in fact, the most important first step after calculating the performance measures is to find out why the performance was so poor
        
        managers need to analyse why:
        a - productivity is falling or below that of our competitors
        b- workers are taking unexplained absences
        c - customers complains about poor services are increasing
        03 - there is no point in spending large amounts on capital equipment to increase efficiency if the main reason of low productivity is a poorly motivated team of employees
        04 - the HRM strategies used by businesses to improve employee performance can be divided in to hard and soft approaches:
        
        01 - HARD STRATEGIES
        
        Hard strategies focuses on warning employees, discplinary action if targets are not met and flexible contracts so that frequent poor performance can easily lead to a dismissal
        
        one beneift of hard strategies is that of lower costs in the short term, however, than focusing on Herzberg's motivator factors and training and developing employees
        
        02 - SOFT STRATEGIES
        
        HRM strategies that adopt a soft approach stress the need to consider employees as a resource to be nurtured and developed
        
        the soft HRM strategies to improve employee performance are:
        
        A - regular performance appraisal against agreed pre-set targets with two-way discussion on how to improve performance
        B - additional training to increase efficiency, to stretch and challenge employees
        C - quality circles.- small group of workers are encouraged to take responsibility for identifying and suggesting solutions to work related problems
        d - autonomous work groups where teams of workers are given multi-skill training and the opportunity to take responsibility for complete section of work. employess can make decisions on the best way for the team to achieve pre-determined goals
        e - financial incentives linked to the profits of the business or an offer of a stake in the ownership of the company such as employee share option schemes
        f - adopting a system of management by objectives
  - - - 01 - the MBO process is best undertaken after a discussion between managers and workers at each level of the organisation
        02 - this form of staff involvement is a key feature of job enrichment
        03 - its an effective way of delegating authority and motivating people
        04 - this approach would be used my managers with Theory Y approach to workers
        05 - if however the targets at each level were merely imposed by senior management (as with theory X style) then motivations would likely be low
        06 - individual targets for performance are established during the annual appraisal process
        07 - for maximum effect, these targets should be agreed with each worker and not without employee's agreement
        08 - for an MBO system to be effective, targets and objectives should be agreed and discussed with the managers and employees at department and individual levels
        09 - this form of employee participation is a key feature of job enrichment and should help provide a motivating force
    - - BENEFITS OF MBO -
        01 - each manager and subordinate will know exactly what they have to do. this will help them priortise their time, it will also enable them to see the importance of what they want to do to the whole organisation and this should lead to increased productivity
        02 - by using the corporate aim and objectives as the key focus of all departmental and individual objectives, everyone should be working on the same overall target. this will avoid conflict and ensure a consistent and well coordinated approach
        
        03 - objectives act as a control device. by setting targets agreed with the people who have the authority to reach them , managers are able to monitor everyone's performance and measure of failure
      - LIMITATIONS OF MBO -
        01 - the process of dividing corporate aim and corporate objectives into divisional, departmental and individual targets can be very time-consuming, especially as this is best performed only after full consultation with those most affected
        02 - objectives can become outdated very quickly and fixing targets and monitoring progress against them can be less useful if the economic environmnet has changed completely
        03 - setting targets does not guarantee success, issues such as adequate resources and employee training must also be addressed if the original targets are to have any meaning or act as true motivating goals
    - - MANAGEMENT BY OBJECTIVES (MBO) - HOW THE CORPORATE AIM IS DIVIDED AT EVERY LEVEL OF THE ORGANISATION
        
        01 - AIM --> to maximise shareholders value
        02 - CORPORATE OBJECTIVES --> to increase profits of all divisions at the end of the year by 10%
        03 - DIVISIONAL OBJECTIVES - within one region, to increase market share by 10% and cut overhead costs by 5%
        04 - DEPARTMENTAL OBJECTIVES
        
        -> marketing - increase profit margins by 7%
        
        05 - INDIVIDUAL TARGETS --> in marketing department, increasing sales by an average of 5% per client introduce 5 more clients to the business each year
  - - - ADVANTAGES OF PART TIME/ ZERO HOURS AND GIG EMPLOYMENT CONTRACTS TO A BUSINESS =
        01 - fixed labour costs are reduced - employees can be required to work at particularly busy times of the day or week but not during less busy periods
        02 - flexbility offers firms real competitve advantages as they can give good customer services without substanital cost increases
        03 - more workers are available to be called upon should there be sickness or other causes of absenteeism
        04 - the efficiency of employees can be assessed before they are offered a full time contract
        05 - zero hours contracts mean that there is no fixed cost element in a workers pay. no guaranteed work or pay is offered, a wage is only paid if the work is called in for work for a specific number of hours
        06 - one off gig contracts for a particular job remove all employment costs other than payment for the job being performed
- - - - the use of IT and AI frees up time for HRM for more strategic issues
        
        it can reduce social and personal contact betweenn HRM and employees and make HR managers feel remote
        
        the increased dependence of it based communication methods reduces the opportunity for two-way group discussions unless conferencing software is used
        
        there is a risk of creating a sense of being watched and monitored at all times amongst employees