Human Resource Management

1. Human Resource Management Small Business Considerations

2. Learning Objectives LO1 Explore the decision to hire full-time or part-time help LO2 Understand how to recruit good employees on your budget LO3 Know how to match the right person to the job LO4 Learn about employee training methods and resources

3. Learning Objectives LO5 Gain insight in meeting employees’ needs and expectations LO6 Learn how to develop a fair compensation and benefit plan LO7 Understand the complexities of managing family within your business

4. Hiring Employees • No decision is as important or complex as the decision to hire an employee • Of the 25.4 million businesses in the United States in 2004, over 19.5 million had no employees • Adding employees increase amount of work that can be done – serving more customers, staying open longer

5. Question The match between the needs, expectations, and culture of the small business with the expectations and the skills of the individual employee is called the ___________. • Screening test • Probationary period • Individual match • Employee fit

6. Hiring Employees • Employee fit • the match between the needs, expectations, and culture of the small business with the expectations and the skills of the individual employee

7. Hiring Employees • Probationary period • trial period in which an employee has temporary status before a formal offer to work full time is presented

8. Federal Laws That Apply as Small Businesses Grow Figure 19.1

9. Federal Employment and Labor Laws Applicable to Growing Businesses Table 19.1

10. Differences In State Laws: The Case of Two Adjoining States

11. Attracting Employees • Internet recruiting • Method of recruiting that allows you to search a résumé database or post a job description to the Web; • a small business owner who knows exactly what he or she wants can use filters to search vast numbers of résumés with pinpoint accuracy.

12. Attracting Employees • Employee referral • An underused, low-cost method for finding workers that rewards your employees for recommending potential candidates that would be a great employee fit.

13. Attracting Employees • Virtual employees • Independent contractors who provide specialized business services or support from a distance, through the Internet, telephone, fax, or another method of communication.

14. Attracting Employees - Sources • Networking • Internet recruiting • Employee referral • Company websites • Career service offices • Professional groups • Outsourcing • Local churches and pastors • Local high school for entry-level jobs • State unemployment offices

15. Matching the Worker to the Work • Job description • Defines and discusses all the essential knowledge, skills, and abilities that are needed to fill a position.

16. Writing a Job Description • Start with a title • Give a job overview • Define the duties and responsibilities • Knowledge, skills, and abilities • Credentials and experience • Special requirements

17. Writing a Job Description Job analysis should include: • The reason the job exists • The mental or physical tasks involved • How the job will be done • The qualifications needed

18. Evaluating Job Prospects • Create same specific questions you will ask of all candidates • Ask that person to demonstrate their skills • Consider involving one or two other interviewers • Never hire a moderately qualified just because you need someone now

19. Typical Types of Behaviorally Based Interview Questions Figure 19.3

20. Training Your Employees • Where is training needed? • What key areas need the most attention? • What specifically must an employee learn in order to be more productive? • Who needs to be trained?

21. Initial and Ongoing Training Methods • On-the-job training • Delivered to employees while they perform their regular jobs • Techniques include orientations, job instruction training, apprenticeships, internships and assistantships, job rotation, and coaching.

22. Initial and Ongoing Training Methods • Off-the-job • Includes lectures, special study, videos, television conferences, case studies, role-playing, simulation, programmed instruction, and laboratory training

23. Three Guidelines for Training • Give your employees opportunities to use their new skills • Make training an ongoing process • Think of training as an investment as opposed to an expense

24. 23 Rewards Offered Employeesof Small Businesses Table 19.3

25. Rewarding Employees • Psychological contract • Refers to employees’ beliefs about the promises between the employee and the firm • Beliefs are based on the perception that promises have been made in exchange for certain employee obligations

26. Rewarding Employees • Open-book policy • Concept that key employees should be able to see and understand a firm’s financials • should have a part in moving the numbers in the right direction • should have a direct stake in the strategy and success of the firm.

27. Factors Most Valuable to Employees

28. Compensation, Benefits, and Perks • Living wage • The amount needed for a person (or family of a particular size) to meet the basic necessities of life from a single job.

29. Compensation, Benefits, and Perks • Bonuses and Long-Term Incentives • Health Insurance • Retirement Plans • Perks

30. Entrepreneurial Leadership • Entrepreneurial Leadership: leadership really means administration • Two key factors: Task and Person • Looks at how you operate as chief executive - 3 components: • Innovation • Operation • Inspiration

31. Question A management philosophy of selecting and promoting people based on family ties is called __________. • Family bias • Favoritism • Nepotism • Meritocracy

32. Human Resource Issuesin the Family Business • Nepotism • A management philosophy of selecting and promoting people based on family ties. • Meritocracy • A management philosophy of selecting and promoting people based solely on their being the most capable person for the job.

33. Good Human Resource Practices for All Businesses • Transparent procedures with consistent application • Job basics • Job metrics • Task repair • Lines of communication • Clear termination rules • Line of appeal

34. Dividing Up Ownership and Dividends • Owners of corporations often receive the base of their compensation as a salary • Family members receive similar packages • Higher than non-family members • Create profit sharing plans or bonus system for non-family members