Human Resource Management. MANAGING CAREERS . Career Management The process of enabling employees to better understand & development their career skills interests , and to use these skills and interests more effectively. Career Development
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MANAGING CAREERS • Career Management The process of enabling employees to better understand & development their career skills interests , and to use these skills and interests more effectively. • Career Development The lifelong series of activities that contribute to a person’s career exploration, establishment, success, and fulfillment.
MANAGING CAREERS • Career Planning The deliberate process through which someone becomes aware of personal skills, interests, knowledge, motivations, and other characteristics; and establishes action plans to attain specific goals. • Career Planning & Development The deliberate process through which a person becomes aware of personal career-related attributes and the lifelong series of steps that contribute to his or her career fulfillment.
Roles in Career Development • The Employees Role • The Employer’s Role • The Organization
Roles in Career Development. . . 1. The Employee’s/Individual Role • Accept responsibility for your own career. • Assess your interests, skills, and values. • Seek out career information and resources. • Establish goals and career plans. • Utilize development opportunities. • Talk with your manager about your career. • Follow through on realistic career plans.
Roles in Career Development. . . 2. The Employer’s/ManagerRole • Provide timely performance feedback. • Provide developmental assignments and support. • Participate in career development discussions. • Support employee development plans. 3. The Organization • Communicate mission, policies, and procedures. • Provide training and development opportunities. • Provide career information and career programs. • Offer a variety of career options.
Managing Promotions & Transfers • Promotions Advancements to positions of increased responsibility. • Transfers Reassignments to similar positions in other parts of firm.
Establishing Strategic Pay Plans • Employee Compensation Employees Compensation refers to all forms of pay or rewards going to employees & arising from their employment. It has two main components: • Direct Financial Payment • Indirect Payments
Employee Compensation (Contd…) • Direct Financial Payment Pay in form of wages, salaries, incentives, commissions, & bonuses. • Indirect Payments Pay in the form of financial benefits such as insurance.
Corporate Policies, Competitive Strategy, & Compensation • Aligned reward strategy • The employer’s basic task is to create a bundle of rewards—a total reward package—specifically aimed at eliciting the employee behaviors the firm needs to support and achieve its competitive strategy. • The HR or compensation manager will write the policies in conjunction with top management, in a manner such that the policies are consistent with the firm’s strategic aims.
Establishing Pay Rates • Step: 1. The Salary Survey • A survey aimed at determining prevailing wage rates. A good salary survey provides specific wage rates for specific jobs. Formal written questionnaire surveys are the most comprehensive, but telephone surveys and newspapers ads are also sources of information. • Benchmark Job A job that is used to anchor the employer’s pay scale and around which other jobs are arranged in order of relative worth.
Benchmark Job (Contd…) • The internet also provides numerous fee-based sources of international salary data. • In most cases, as noted above, salary survey data are used to price benchmark jobs, around which other jobs are then slotted based on the job’s relative worth.
Step: 2. Job Evaluation • Job evaluation is aimed at determining a job’s relative worth. It is a formal and systematic comparison of jobs to determine the worth of one job relative to another and eventually results in a wage or salary hierarchy. • The basic principle is this: Jobs that require greater qualifications, more responsibilities, and more complex job duties should be paid more highly than jobs with lesser requirements.
Step: 2. Job Evaluation (Contd…) • The basic procedure is to compare the jobs in relation to one another—for example, in terms of required effort, responsibility, and skills. Suppose you know (based on your salary survey) how to price key benchmark jobs, and then use job evaluation to determine the relative worth of all the other jobs in your firm relative to these key jobs. You are then well on your way to being able to price all the jobs in your organization equitably.
Compensable Factor • A fundamental, compensable element of a job, such as skills, effort, responsibility, and working conditions. • Some employers develop their own compensable factors. However, most use factors popularized by packaged job evaluation system or by federal legislation.
Compensable Factor (Contd…) • Identifying compensable factors plays a central role in job evaluation. You usually compare each job with all comparable jobs using the same compensable factors.
Preparing for the Job Evaluation • Job evaluation is mostly a judgmental process, one demanding close cooperation among supervisors. HR specialists, and employees and union representatives.
Preparing for the Job Evaluation… • Identifying the need for the job evaluation • Employee feedback, high turnover, etc. • Getting the cooperation of employees • They may fear having their pay reduced • Choosing an evaluation committee. • Should include employees who actually perform the job • Performing the actual evaluation.
Job Evaluation Methods • Ranking The simplest job evaluation methods ranks each job relative to all other jobs, usually based on some overall factor like “job difficulty”. There are several steps in the job ranking method.
Ranking Method (Contd…) • There are several steps in the job ranking method. • Obtain job information Job analysis is the first step: Job descriptions for each job are prepared and are usually the basis for ranking jobs. • Select & group Jobs It is often not practical to make single ranking for all jobs in an organization. The usual procedure is to rank jobs by department or in clusters (such as factory workers or clerical workers).
Ranking Method (Contd…) • Rank Jobs The simplest way is to give each rater a set of index cards, each of which contains a brief description of a job. • Combine Ratings Usually, several raters rank the jobs independently. Then the rating committee (or the employer) can simply average the rankings.
Pricing Managerial & Professional Jobs • Compensating managers • Base pay: fixed salary, guaranteed bonuses. • Short-term incentives: cash or stock bonuses • Long-term incentives: stock options • The right to purchase stock at a specific price for a specific period • Excellent retention tool • Executive benefits and perks: retirement plans, life insurance, and health insurance without a deductible or coinsurance.
Pricing Managerial & Professional Jobs… • What Really Determines Executive Pay? • CEO pay is set by the board of directors taking into account factors such as the business strategy, corporate trends, and where they want to be in a short and long term. • Traditional wisdom is that the company size determines top managers’ salaries • Firms pay CEOs based on the complexity of the jobs they filled. • Boards are reducing the relative importance of base salary while boosting the emphasis on performance-based pay.
Compensating Professional Employees • Employers can use job evaluation for professional jobs. • Compensable factors focus on problem solving, creativity, job scope, and technical knowledge and expertise. • Firms use the point method and factor comparison methods, although job classification seems most popular. • Professional jobs are market-priced to establish the values for benchmark jobs.
Other Compensation Trends • Broadbanding • Consolidating salary grades and ranges into just a few wide levels or “bands,” each of which contains a relatively wide range of jobs and salary levels. • Wide bands provide for more flexibility in assigning workers to different job grades. • Lack of permanence in job responsibilities can be unsettling to new employees.
Strategic Compensation • Strategic compensation • Using the compensation plan to support the company’s strategic aims. • Focuses employees’ attention on the values of winning, execution, and speed, and on being better, faster, and more competitive.
Strategic Compensation… • IBM’s strategic compensation plan: • The marketplace rules. • Switched from a previous single salary structure to different salary structures and merit budgets • Fewer jobs, evaluated differently, in broadbands. • 3 compensable factors: skills, leadership requirements & scope/impact • Managers manage. • Managers get a budget and are advised to pay “stars” more • Big stakes for stakeholders.
Comparable Worth • Comparable worth • Refers to the requirement to pay men and women equal wages for jobs that are of comparable (rather than strictly equal) value to the employer. • Seeks to address the issue that women have jobs that are dissimilar to those of men and those jobs often consistently valued less than men’s jobs.
Compensation and Women • Factors lowering the earnings of women: • Women’s starting salaries are traditionally lower. • Salary increases for women in professional jobs do not reflect their above-average performance. • In white-collar jobs, men change jobs more frequently, enabling them to be promoted to higher-level jobs over women with more seniority. • In blue-collar jobs, women tend to be placed in departments with lower-paying jobs.