BSBHRM501 Student Workbookpdf 2001

1st Edition

Manage human resources services BSBHRM501B

Student Workbook

Student Workbook BSBHRM501B Manage human resources services 1st Edition 2014

Part of a suite of support materials for the

BSB07 Business Services Training Package

Acknowledgment Innovation and Business Industry Skills Council (IBSA) would like to acknowledge Impact Training and Development Solutions for their assistance with the original development of the resource for BSBHRM501A. Writer: Joanna Hull

Industry reviewer: Kristen Miller

This resource for BSBHRM501B was developed by IBSA. Copyright and Trade Mark Statement © 2014 Innovation and Business Industry Skills Council Ltd All rights reserved. Apart from any use permitted under the Copyright Act 1968, no part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, or otherwise, without written permission from the publisher, Innovation and Business Industry Skills Council Ltd (‘IBSA’). Use of this work for purposes other than those indicated above, requires the prior written permission of IBSA. Requests should be addressed to Product Development Manager, IBSA, Level 11, 176 Wellington Pde, East Melbourne VIC 3002 or email [email protected]. ‘Innovation and Business Skills Australia’, ‘IBSA’ and the IBSA logo are trade marks of IBSA.

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(b)

if the breach relates to services: (i) re-supplying; or (ii) paying the cost of re-supplying, the services.

Published by: Innovation and Business Industry 1st edition published: January 2014 Skills Council Ltd 1st edition version: 1 Level 11 176 Wellington Parade Release date: January 2014 East Melbourne VIC 3002 Phone: +61 3 9815 7000 Fax: +61 3 9815 7001 Email: [email protected] www.ibsa.org.au ISBN: 978-1-925123-10-4 Stock code: BSBHRM501B1D

Table of Contents Introduction .........................................................................................................................1 Features of the training program .................................................................................1 Structure of the training program ................................................................................1 Recommended reading ................................................................................................1 Section 1 – Develop Human Resources Delivery Strategies............................................3 What skills will you need? ............................................................................................3 Human resources requirements ..................................................................................4 Strategic and operational plans ...................................................................................7 Review external business environment.................................................................... 13 Consult with managers .............................................................................................. 17 Human resources service delivery models and strategies ..................................... 18 Develop models ......................................................................................................... 27 Assess costs and benefits for delivery options ........................................................ 31 Develop strategies and action plans ........................................................................ 35 Section summary ....................................................................................................... 46 Further reading .......................................................................................................... 46 Section checklist ........................................................................................................ 47 Section 2 – Deliver Human Resources Services ............................................................ 48 What skills will you need? ......................................................................................... 48 Develop service level agreements ............................................................................ 49 Negotiate service level agreements ......................................................................... 52 Document service level agreements ........................................................................ 58 Training requirements ............................................................................................... 65 Quality assurance ...................................................................................................... 66 Identify and rectify underperformance ..................................................................... 72 Section summary ....................................................................................................... 73 Further reading .......................................................................................................... 74 Section checklist ........................................................................................................ 74 Section 3 – Evaluate Human Resources Service Delivery ............................................ 75 What skills will you need? ......................................................................................... 76 Establish systems for monitoring and evaluation .................................................... 76 Client feedback .......................................................................................................... 79 Analyse client feedback............................................................................................. 85 Evaluate business impact ......................................................................................... 89 Recommend variations ............................................................................................. 91 Section summary ....................................................................................................... 94

Further reading .......................................................................................................... 94 Section checklist ........................................................................................................ 95 Section 4 – Integrate Business Ethics in Human Resources Practices ....................... 96 What skills will you need? ......................................................................................... 97 What are business ethics? ........................................................................................ 97 Codes of ethics and codes of conduct ..................................................................... 99 Human resources policies and practices ............................................................... 103 Human resources team member behaviour .......................................................... 104 Observe confidentiality requirements .................................................................... 106 Deal with unethical behaviour ................................................................................ 107 Section summary ..................................................................................................... 112 Further reading ........................................................................................................ 112 Section checklist ...................................................................................................... 113 Glossary .......................................................................................................................... 114 Appendix – DuPont’s new HR model ............................................................................ 119

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Introduction

Introduction Features of the training program The key features of this program are: ● Student Workbook – Self-paced learning activities to help you to understand key

concepts and terms. The Student Workbook is broken down into several sections. ● Facilitator-led sessions – Challenging and interesting learning activities that can be

completed in the classroom or by distance learning that will help you consolidate and apply what you have learned in the Student Workbook. ● Assessment Tasks – Summative assessments where you can apply your new skills

and knowledge to solve authentic workplace tasks and problems.

Structure of the training program This training program introduces you to performance outcomes, skills and knowledge required to plan and oversee and deliver human resources services. Specifically, you will develop the skills and knowledge in the following topic areas: 1. Develop human resources strategy. 2. Deliver human resources services. 3. Evaluate human resources service delivery. 4. Integrate business ethics and human resources practices. Your facilitator may choose to combine or split sessions. For example, in some cases, this Training Program may be delivered in two or three sessions, or in others, as many as eight sessions.

Recommended reading Some recommended reading for this unit includes: ● Anthony, W., Kacmar K. and Perrewe, P., 2005, Human resource management: A

strategic approach, 5th edn, Cengage South-Western, Ohio. ● Barry, V. and Shaw, W., 2001, Moral issues in business, Wadsworth, California. ● Cole, K., 2001, Supervision: The theory and practice of first-line management,

Pearson Education Australia, NSW. ● Compton, R., Morrissey, W. and Nankervis, A. 2009, Effective recruitment and

selection practices, 5th edn, CCH Australia, Sydney. ● Josefowitz, O., 2008, The Global HR Delivery Model (Diploma thesis, Haute École de

Gestion de Genève) viewed January 2014, retrieved from: . BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd

1st edition version: 1 Page 1 of 120

Introduction

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● Kramar, R., Bartram, T., De Cieri H., Noe, R., Hollenbeck, J., Gerhart, B. and Wright,

P., 2013, Human Resource Management in Australia, 5th edn, McGraw-Hill Australia. ● Sullivan, J., 2008, ‘Selecting an HR strategy’, WorkInfo.com, viewed January 2014,

. ● Ulrich, D., Younger, J., Brockbank, W. and Ulrich, M., 2012, HR from the outside in:

Six competencies for the future of human resources, McGraw-Hill, USA.


BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd

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Section 1 – Develop Human Resources Delivery Strategies

Section 1 – Develop Human Resources Delivery Strategies This section is about the skills and knowledge required to develop a human resources strategy that meets organisational needs. Scenario: Aligning HR to the business vision at Australian Hardware Australian Hardware (a simulated business) is a large and expanding hardware and homeware retailer with approximately 140 stores located across Australia. In its vision statement, Australian Hardware outlines that it intends to lead the hardware and homeimprovement market in Australia within five years. In order to realise this vision, the organisation will take the following strategic approaches outlined in its business plan: ● increase sales revenue and gross profit ● maintain or increase market share ● control direct and indirect operational costs ● maintain superior product and service quality standards ● establish reputation of Australian Hardware as a socially and environmentally

responsible company. As part of supporting these strategic approaches, Australian Hardware intends to review and revamp human resources (HR) practices to better align the company’s vision and strategy and contribute to the ongoing success of the business. Connie is newly employed as HR manager at Australian Hardware. Her first order of business will be to review the organisation’s HR requirements in order to develop effective HR delivery strategies. Australian Hardware simulated business information, including business and operational plans, financial information, and policies and procedures can be located online at .

What skills will you need? In order to work effectively as a human resources professional, you must be able to:  analyse business strategy and operational plans to identify human resources requirements  review the business environment and its impact on the organisation's human resources requirements  consult with managers to identify human resources needs in their areas  review the organisation's requirements for workplace diversity BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd



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 develop HR options that comply with legislative requirements, organisational policies and business goals  develop and agree on strategies and action plans for delivery of human resources services  agree and document roles and responsibilities of human resources team, line managers, and external contractors.

Human resources requirements Organisations have varying human resources requirements. It is the role of human resources professionals responsible for planning the delivery of HR services to identify these requirements and determine the right strategies for delivering those services. Human resources service requirements include: ● recruitment and selection

● discrimination and harassment

advice and support

● employee development planning

● work health and safety (OHS/WHS)

● competency identification

● rehabilitation and return to work

● performance counselling ● training and development programs ● feedback tools and programs ● flexible work arrangements ● orientation and induction

● remuneration and benefits advice ● succession planning ● industrial relations advice ● workers’ compensation.

Depending on the organisation and the HR structure, HR service delivery planning and strategising may be the responsibility of HR professionals in different areas and at different levels of the organisation. For example, HR managers at a senior level may consult with all areas of the business to develop an overall approach to service delivery. HR professionals embedded in business units and reporting to line managers may make more localised decisions on customised service delivery, sometimes mediating services requested by employees and line managers and provided by centralised HR. Human resources professionals may also be specialists in recruitment, policy development or training, for example, and work within HR ‘centres of excellence’ providing services to other business units as they are required. To determine requirements and ensure that the most appropriate strategies are used for the delivery of human resources services, human resources professionals are required to: ● analyse organisational strategic and operational plans ● consult with managers to determine needs.



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Learning activity: Strategies to deliver HR services Consider your organisational an organisation you would like to research. ● What services does HR deliver?

● How are services delivered?

● Who delivers the services? For example:

○ A centralised HR? ○ HR officers embedded in business units? ○ An HR ‘centre of excellence’? ○ A variety of HR professions who share responsibility and accountability for the delivery of services to the business?

● Does the organisation’s HR employ an overall strategy or strategies to deliver HR

services in a coherent way and in accordance with organisational goals?

Use the link below to access the University of Birmingham human resources strategy. This is a good example of what is required when developing a human resources strategy. ● University of Birmingham, HR strategy 2007–2012, viewed January 2014,

. Once you have reviewed the strategy, answer the questions below.




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● What is the university trying to achieve through the human resources strategy?

● How is the strategy linked to the organisation’s goals and objectives?

● What areas of human resources service delivery does the strategy cover?

● How do you think the university will benefit from having such a strategy in place?



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Strategic and operational plans Strategic and operational plans are the road map for an organisation and its employees to follow in order to achieve the organisation’s goals. These plans incorporate the values, vision and mission of the organisation and detail the strategies and specific actions or tactics required to achieve the organisation’s goals. They typically look ahead three to five years. An organisation’s strategic and operational plans provide the following information. Who are we?

The organisation’s vision and values.

Where are we now?

The organisation’s current strengths, weaknesses, opportunities and threats.

Where do we want to be?

The organisation’s long-term mission and goals.

How will we get there?

The strategies and actions that will be implemented to achieve organisational goals.

Learning activity: Accessing strategic and operational plans Consider your organisation or an organisation you would like to research. If possible, access the organisation’s business, strategic or operational plans. ● Describe the organisation’s mission and values.

● What are the organisation’s strengths, weaknesses opportunities and threats?




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● What is the organisation’s vision for the future?

● What are the organisation’s goals?

● What approach will the organisation take to achieving its vision and strategic

goals?

If no plans are available to you, you may wish to study examples of simulated business documentation for: ● Australian Hardware ● CoffeeVille.

Simulated business information can be located online at .



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Aligning the human resources strategy A human resources strategy must be aligned with an organisation’s strategic and operational plans to ensure it actively supports the successful achievement of the organisation’s goals. The specific deliverables of a human resources strategy depend on the goals of the organisation’s strategic and operational plans. This can be very different from one organisation to another. These differences are best demonstrated in the table below. The table describes some corporate strategies of different organisations and the human resources strategies implemented to achieve those goals. This is a good example of how human resources strategies can support organisations to achieve their corporate strategy. Organisations may cycle through different corporate strategies at different times based on their performance, the health of the economy and a range of other factors. Corporate strategy

Human resources strategies

Retrenchment (cost reduction)

Redundancies, wage reduction, productivity increases, job redesign, renegotiated agreements.

Growth

Aggressive recruiting and hiring, rapid wage rises, job creation, expanding training and development.

Renewal

Managed turnover, selective redundancies, organisational development, transfer/replacement, productivity increases, and employee involvement.

Niche focus

Specialised job creation, elimination of other jobs, specialised training and development.

Acquisition

Selective redundancies, transfers/replacement/job combinations, orientation and training, managing cultural transitions. 1

Anthony, W., Kacmar, M. and Perrewe, P., 2002, ‘Strategic compensation systems’, Human resources management, South-Western, Ohio, Ch. 11, p. 17. 1




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Learning activity: Strategic and operational plans Research a copy of an organisation’s strategic plan and complete the table below. You can either access one from your current organisation or visit . Strategic goal

HR Strategy

Detail the strategic goals from the strategic plan you have accessed.

Detail the human resources strategies that you could implement to assist in the achievement of these goals.



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Analysis of strategic and operational plans Human resources professionals must obtain copies of an organisation’s strategic and operational plans for analysis to determine the human resources requirements of the business. Analysis of an organisation’s strategic and operational plans involves: ● identifying the vision, values and mission of the organisation to understand, from a

strategic perspective, what is important to the organisation (values), what the organisation is trying to achieve (vision) and what the organisation is doing to achieve its vision and mission ● identifying the organisation’s current state – including its strengths, weaknesses,

opportunities and threats – to understand the successes and challenges the organisation is currently facing ● identifying the organisation’s goals to understand how the organisation will

measure its success and following from there, the success of the human resources strategy ● identifying the strategies and actions that will be implemented to achieve

organisational goals to determine how human resources can specifically support the achievement of those strategies, actions and goals.

Reviewing diversity-related goals Organisations may have particular goals relating to fostering the diversity of its workforce. Such goals may or may not be articulated as part of the organisation’s vision, values or strategic objectives. Nevertheless, policies and procedures may state the organisation’s commitment to diversity and eliminating discrimination. Such policies may also express the organisation’s legal obligations with regard to ensuring workplace equity. As part of developing your approach to delivering HR services, you will therefore need to consider how to deliver HR services to support diversity-related goals and integrate your activities with other diversity-related programs. Learning activity: Interpreting strategic and operational plans Using the same strategic plan example you used for the previous activity identify the following. Vision, values and mission of the organisation




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Organisation’s: ● Strengths ● Weaknesses ● Opportunities ● Threats.

Organisational goals

Strategies and actions to be implemented to achieve organisational goals

Strategies and actions to be implemented to achieve organisational goals related to diversity and equity

Human resources professionals must have a good understanding of the organisation’s strategic and operational plans to ensure that they determine the most appropriate strategies for delivering the human resources services. 1st edition version: 1 Page 12 of 120


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Review external business environment In order to ensure your approach to HR service delivery is realistic and achievable, you will need to consider the external business environment. One useful model for analysing the types of external forces acting upon an organisation, determining challenges and creating opportunities for the business is the PEST model. PEST stands for:

P

E

S

T

Political

Economic

Social

Technological

(includes legislation)

As you develop strategies to deliver HR services, you will need to consider all four aspects of the external environment. Let’s look at these in more detail.

Political environment The political environment includes legislation and government legislative direction that could affect what HR services are necessary and how they are delivered. When determining the most appropriate model for the delivery of human resources services it is important that human resources professionals consider the relevant legislative requirements and organisational policies that may be impacted by the model chosen. Legislative requirements can include: ● award and enterprise agreements, and relevant industrial instruments ● mandatory compliance with industry codes of practice ● legislation that affects business operations such as:

○ the Fair Work Act 2009 ○ work health and safety (OHS/WHS) ○ equal opportunity ○ anti-discrimination legislation. Failing to consider these requirements could result in: ● employee grievances due to the organisation not complying with terms and

conditions set out by their applicable award, enterprise agreement or other industrial instruments ● the organisation having a poor reputation in the marketplace for non-compliance

with industry codes of practice affecting its ability build alliances with industry partners ● negative customer perceptions ● penalties for non-compliance from regulatory bodies




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● disgruntled employees due to the organisation’s failure to deliver against stated

policies and procedures ● negative employment brand in the marketplace impacting on the organisation’s

ability to attract and retain high performing team members. Let’s look at an example political environment: Example: Australian Hardware political environment Relevant legislation may include, for example: ● Privacy Act 1988 (Cwlth) ● state-based anti-discrimination Acts ● Australian Securities and Investments Commission Act 2001 (Cwlth) ● Competition and Consumer Act 2010, including the Australian Consumer Law

(ACL). Of particular interest for human resourcing is anti-discrimination legislation. Australian Hardware needs to ensure HR services are delivered to meet the organisation’s legal obligations with regard to fairness in recruitment practices or rewards and recognition, for example.

Economic environment The economic environment includes factors which affect the ability of organisations to compete with other organisations and to maintain or improve profitability. Example: Australian Hardware economic environment Interestingly, sluggish growth and moderate increase in the Australian unemployment figures may present an opportunity for hardware and home-improvement retailers such as Australian Hardware. This opportunity exists despite other retailers suffering from low consumer confidence, poor sales and overseas competition particularly through ecommerce. Hardware retailers have benefitted from the sense among homeowners that now is the time to choose renovation and home improvements rather than selling and moving to an already renovated house. According to IBISWorld, the trend towards home improvements is linked to the increase in residential housing prices, which is due to the housing shortage and easier access to finance and government incentives, amongst other factors. If current trends continue, the industry is expected to grow by 23% from 2011 figures to reach $14.2 billion in 2016–17.2

2

IBISWorld, 2011, ‘Aussies Going Blockbusters for DIY’, IBISWorld Press Release.



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From a human resourcing perspective, the economic environment is important for the delivery of services. Naturally, Australian Hardware HR needs to ensure costs of services are kept low enough to contribute to the achievement of profitability goals. HR also needs to consider the changing marketplace in order to take a more strategic approach to helping the organisation meet its need to provide value to customers. For example, HR needs to consider customer needs related to the economic environment. What are they able to or willing to pay? What economic forces might indicate a rise in demand for some products or services? HR will need to consider how it can contribute to helping the organisation meet the needs of customers through more effective and targeted recruiting practices, rewards and recognition to retain the right people, and partnering with the store managers and customer-facing employees to support their needs.

Social environment The social environment includes all demographic and psychographic factors (customers’ ways of thinking, values and lifestyle) that influence the organisation’s image and success in marketing its products and services. The social environment may also have a more or less direct influence on how an organisation may position itself as an employer and attempt to attract the right people to work for it. Let’s look at another Australian Hardware example. Example: Australian Hardware social environment Consumers are increasingly aware of the impact of business activity on the local community. Consumers demand that businesses consider the impact of their activities and work to promote healthy community involvement. Consumers are also becoming more aware of working conditions in other countries want to contribute to better global social and economic outcomes. Consumers are also concerned about the environment. Australian Hardware will endeavour to promote itself as environmentally and socially responsible and conduct business operations accordingly. In this way, Australian Hardware will offer value to the socially and environmentally aware consumer and position itself as a leader in social and environmental responsibility. From a human resourcing perspective, Australian Hardware needs to ensure the delivery of HR services lives up to its environmental commitments. Australian Hardware will also need to position itself as a responsible employer in order to attract talented staff and staff who are committed to upholding and promoting values of Australian Hardware.

Technological environment The technological environment includes the rapidly changing telecommunications environments including the rise of the internet as a business channel and e-commerce. The technological environment also includes business tools to increase efficiency and reduce the cost of delivering HR services to internal clients and gathering performance information. Let’s look at an Australian Hardware example. BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd



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Example: Australian Hardware technological environment Internet, information, and social networking technologies continue to evolve and provide new challenges and opportunities for marketing. Australian Hardware will continue with its effective use of its website to promote and sell products and social networking to reach its target markets. From an HR perspective, Australian Hardware will need to ensure its Human Resources Management System (HRMS) is able to effectively manage such things as online payroll and benefits enquiries, and self-management of leave enquiries and requests. The HR management system will need to collect HR information on important metrics such as leave hours, absences, and training requests and approvals, for example. The HRMS will also need to integrate with existing systems for payroll and accounting as well as the organisation’s resource planning (ERP) software system. To reduce costs and stay competitive in a dynamic and rapidly changing technological environment, Australian Hardware is considering outsourcing some automatic and selfserve HR functions to a specialist organisation. Such a move may have the desired effect of allowing Australian Hardware HR to focus less on routine tasks and take a more strategic role in resource planning.

Learning activity: PEST analysis Consider your own organisation or an organisation you would like to research. Research the PEST environment and analyse its possible effect of the delivery of HR services. Political

Economic

Social

Technological



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Consult with managers When determining strategies for the delivery of human resources services it is important for human resources professionals to consult with line and senior managers. This consultation will provide information regarding the human resources services needs of the teams and departments that they manage. Senior managers will be able to provide a more strategic perspective on the organisation’s need for services that advance the aims of the business. On the other hand, it is important to gain the perspective and support of line managers, who have a more direct relationship with customer-facing staff and often a more intimate knowledge of operations. If it is your responsibility to propose recommendations for HR changes, you will need to consult with a wide range of people: those who must agree of have power of veto over your plans; those who must implement your plans; those whose input you need to, for example, understand technical issues or a variety of perspectives; and those who have final say and are responsible and accountable for the decision to go ahead.

Consultation methods There are a number of consultation methods that human resources professionals can use to obtain information from managers regarding their human resources service needs. These include the following. ● Meetings: Meetings are most effective for obtaining information regarding the

specific needs of a team or department. They are also an excellent opportunity to engage managers in the design of the human resources strategy which will often prove to be beneficial during implementation. Managers that are consulted with during the design phase often feel like a valuable contributor and then are more likely to actively support a successful implementation. ● One-on-one meetings/interviews: A one-on-one meeting is for situations where

feedback is obtained by speaking with one person at a time. This is particularly important when trying to obtain very specific feedback or when the subject matter maybe confidential or controversial and feedback where people might be uncomfortable sharing the information with others or speaking in groups. ● Focus groups: Focus groups are used to consult with groups of people. They are

often the most time efficient method for obtaining information from large departments that have several managers responsible for teams of employees who all do the same thing. For example, a focus group could be used to consult with managers in a call centre where the team members complete the same role under the same work conditions. ● Surveys: Surveys are an excellent tool for obtaining information from large groups

of managers regarding their human resources needs. Surveys to obtain information regarding human resources requirements could include the following questions. ○ How many roles have you recruited in the last 12 months? ○ What orientation and induction programs do you currently provide to newly hired employees? ○ What training and development programs has your team participated in? ○ How many workplace injuries have occurred in your team in the last 12 months? BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd



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Learning activity: Consulting with managers Consider your organisation, or an organisation you would like to research. ● What managers or stakeholders would need to be consulted on HR requirements

in order to meet business needs?

Develop a survey that you could provide to managers or other stakeholders to obtain information regarding their human resources service requirements.

Human resources service delivery models and strategies Organisations implement various models for the delivery of human resources services depending on the organisation’s needs. It is important that human resources professionals understand the different options available to allow them to develop customised HR service delivery models that are beneficial to the organisation they support. Let’s first take a look at some general approaches to HR service delivery. These may be described as the traditional approach and the Dave Ulrich Model.

Traditional approaches to HR In the traditional HR model, HR is a single team, comprised of generalists, specialists and administration.3 The model may be applied in different ways, mainly based on the size of the organisation. HR may be comprised of a single team of HR generalists, as is common in smaller organisations. In such organisations, an HR generalist may be a ‘jack-of-all-trades’; performing the range of HR functions from administrative tasks to some aspects of business planning. In larger organisations, HR service delivery may be more specialised. HR service delivery may be organised into HR specialists (such as industrial relations experts, recruitment experts or training experts) and administration, or several teams organised by business units or locations in accordance with the corporate strategy. The traditional HR model – in contrast with the Dave Ulrich model discussed below – may be characterised as administration-focused. Principally, HR provides essential services to the business, as decided by the business, which then is enabled to perform the real work and achieve the vision of the organisation. It is important to note that the traditional, administrative-focussed, less strategically engaged model of HR is still very common in many organisations. Swift, G., 2012, ‘Human resource service delivery’ in Managing people and organisations, Eds. Taylor, S, Woodhams, C, CIPD.

3



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Dave Ulrich’s ‘three-legged stool’ or classic model The ‘three-legged stool’ model, or classic HR model was developed by David Ulrich and others, and is now generally considered best practice. Although its specific application in organisations that adopt it can vary according to business needs, the main point of contrast between this model and the traditional HR model is the focus on ‘business partnering’. In the traditional HR model, the focus is on performing administrative tasks or providing expert advice to, and services for, line managers. The focus of the Ulrich model is on partnering with managers at all levels to deliver services in the best way possible to help them meet the needs of the business – to recruit the right people, performance manage staff and meet customer needs. In addition, the Ulrich model entails the engagement of HR in leading the organisation through shaping strategic approaches to, for example service delivery and building organisational capability to achieve the organisation’s goals and vision. The model is organised into three elements: ● business partners ● shared services ● centres of excellence.

The diagram below summarises the Ulrich model:

Centres of excellence • Create HR frameworks • Deliver strategic initiatives • Comprise specialist areas and expertise: training, recruitment, etc.

Business partner

Shared services

• Establish relationships with line managers

• Deliver HR services through various channels such as call centres, IT

• Help meet business unit objectives.

• May be outsourced • HR shares resources and costs with various business units.




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Note that the model retains the functions of traditional HR, but organises them into three main coordinated areas. The main addition within the Ulrich model is the prominence of business partnering, which is given its own element in the Ulrich model. Note that particular organisations may take their own distinctive approaches to HR service delivery to meet particular needs. For example, they may apply the Ulrich model wholesale; or, they may retain older HR structures, overlaying a more strategic, business partnering approach to service delivery. Let’s take a closer look at the application of HR models and various strategies that may form components of organisations’ specific models of HR service delivery.

Common service delivery strategies Human resources services are provided through a variety of approaches. Organisations typically implement a model including a combination of strategies that best suits their business needs. Human resources professionals must be aware of the options available when determining the most suitable strategies or approaches for their organisation. The most common strategies include the following. Business partner

Human resources professionals are assigned a business unit or department in the organisation for which they are provide human resources support. This support is typically more strategic, that is general and overarching, than tactical.

Generalist

A team of human resources professionals provide generalist support across the organisation. Individuals within the team have general human resources skills and rely on external specialists for expert advice in specific areas, e.g. work health and safety or industrial relations.

Call Centre

Managers and employees access human resources support and information through a telephone call centre.

e-HR

Managers and employees access human resources support and information through an intranet site. This tool provides information and tools for managers and employees to manage their own human resources needs.

Centre of Excellence

Human resources professionals are organised into teams according to their specialist skills. For example, there may be a learning and development team, employee relations team, and remuneration and benefits team. These teams provide specialist advice across the organisation and managers and employees work with the team they require advice and support from.

Outsource

Human resources services and support are outsourced to specialist HR service delivery organisations. Businesses often use a blend of inhouse and outsourced services. The most common outsourced HR services are payroll and recruitment and selection.



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Learning activity: HR service delivery strategies Access the following article online: ● Sullivan, J., ‘Selecting an HR strategy’, Workinfo.com, viewed January 2014,

. This article provides a summary of ten human resources service delivery strategies including the advantages and disadvantages of each. After reading the article, summarise each of the ten strategies described including the advantages and disadvantages of each and the situations that each strategy is best suited for.

Model

Summary

1.

Advantages

Disadvantages

When would you use this model?

2.

Advantages

Disadvantages





Model

Summary

3.

Advantages

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Disadvantages


4.

Advantages

Disadvantages


5.

Advantages

Disadvantages




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Model

Summary

6.

Advantages

Disadvantages


7.

Advantages

Disadvantages


8.

Advantages

Disadvantages





Model

Summary

9.

Advantages

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Disadvantages


10.

Advantages

Disadvantages


The impacts of service delivery models on legislative requirements You will need to consider options for HR service delivery in light of organisational values, commitments and legal obligations. The model used for the provision of human resources services can impact the organisation’s ability to meets its legislative requirements. Having the right service delivery model means having the right resources with the necessary skills and experience to ensure the organisation meets its legislative requirements. Let’s look at a case study example: Case study: Tuff Plastics Tuff Plastics is a manufacturing organisation. It has a highly unionised workforce and experiences a lot of industrial issues. Due to the physical demands of employees working on a processing line, it also has a lot of employee injuries and so requires a significant focus on WHS/OHS issues.



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A generalist model for providing human resources services would not be in the best interests of Tuff Plastics as it would not provide the specialist human resources knowledge and skills required to ensure compliance with industrial relations and work/occupational health and safety legislation. Under a generalist model, the human resources professional supporting Tuff Plastics would need to have expertise in industrial relations, union management, health and safety, injury management as well as all other functions of human resources. This is such a diverse range of skills and focus that important aspects of the legislation may be overlooked. Tuff Plastics would benefit from an outsourced or centres of excellence model where experts could be engaged to provide the specialist advice and services required. Under these models, the human resources professional would have time to focus on supporting the organisation to achieve its strategic goals, and experts in industrial relations and occupational health and safety could be engaged to ensure legislative requirements were being met. Under these models the organisation is getting all of the support and focus it needs to achieve all of its goals and meet all of its obligations.

Learning activity: Human resources service delivery strategic options Consider each of the organisations below and detail the service delivery strategic options that could be appropriate for that organisation and why they are appropriate. Organisation

Strategy

Why?

Medium size manufacturing organisation with 1,000 employees across Australia. The organisation relies heavily on performance data to manage the business.




Organisation

Strategy

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Why?

Three-year-old small business with 150 employees and a new HR function.

A global organisation with over 10,000 employees that is focused on minimising costs through maximising productivity.



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Develop models After considering the models and strategies available for structuring the delivery of HR services, HR professionals need to translate those options into customised models that are relevant to their organisation. This involves demonstrating how different strategies can support the provision of human resources services across the business, including the strengths and weaknesses of each. These strengths and weaknesses include consideration of costs, benefits and risks, which will be discussed in more detail in the next topic. The following is an example of a TAFE’s generalist delivery model. The TAFE is considering the strengths and weaknesses of their current generalist model (below) in comparison with a centres of excellence model. Regional Human Resources – Service Delivery Model Teams Area 1

Area 2

Area 3

Support the following campuses:



● Coonabarabran

● Narrabri

● Goondiwindi

● Quirindi

● Moree

● Tenterfield

● Tamworth

● Armidale

● Glenn Innes.

● Gunnedah.

● Tingha.

Strategy ● people development

● condition management

● employee and industrial relations

● organisational culture and change

● recruitment and employment

● conduct and performance

● workforce planning ● equity and diversity.


strategies

● occupational health and safety/WHS.

● workplace communication.



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Services ● people development

● payroll

● employee and industrial relations

● workforce planning

● recruitment and employment

● safety working and learning strategies.

strategies

● organisational culture and change.

● workplace communication.

The table below details the strengths and weakness that the TAFE has identified for each of the models including the cost benefits and risks. Strengths ● High customer contact with a high level of

line manager support provided.

Generalist model (current)

● HR team members build close relationships

with the business, which allows them build solutions that fit the unique needs of the business unit. ● Due to close relationship with the business,

HR team members respond quickly to business needs. ● High ‘personal’ credibility between HR team

members and line managers.

Weaknesses ● Difficulty in attracting and recruiting HR team members with knowledge

and skills across all HR functions. ● Expensive due to high salaries required to attract and retain broad skill set

required for generalist HR team members and the fact that external consultants are required for specialist support. ● HR team members can become too loyal to their business unit leadership

and less so to corporate leadership resulting in inconsistent HR strategies and initiatives being implemented across the broader business. ● Generalists can spend too much time ‘hand holding’ and doing tactical

work rather than focusing on strategic issues resulting in the organisation’s ability to meet strategic goals being negatively impacted. ● HR team members may have insufficient technical knowledge to solve

complex one-of-a-kind problems which can expose the organisation to risk. ● No central HR knowledge base is established because information transfer

between HR team members in different business units is often limited and most information is never captured in central HR.



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Strengths ● Issues are identified and solved quickly, as

HR team members are focused on specific areas.

Centre of Excellence Model

● Internal HR team members have a better

understanding of the business and its operation than external consultants. ● Less need for use of expensive external

specialist consultants. This can significantly reduce costs. ● Expert knowledge held within the

organisation, which builds organisational capability. ● Ability to manage risks proactively as HR

team members have the specialist knowledge required to work with the business in a proactive capacity rather than reactive which is often the case when engaging external consultants.


Weaknesses ● Inability to attract and recruit HR team members with the specialist

knowledge required which could expose the organisation to risk by not having access to the skills and knowledge required to resolve complex issues. ● Significant set-up costs and time to build teams with the skills and

knowledge required. ● Unable to use knowledge that external consultants have attained through

supporting other organisations with similar issues which could delay the identification of resolutions and impact the organisation’s ability to implement best practice. ● Line managers have more than one contact within the HR team which can

lead to frustration as to who to contact for what support and often results in not engaging with HR as it is considered ‘too hard’. ● Managers may continue to use existing relationships with external

consultants and therefore double the cost to the organisation for the same services, for example managers continue to use external recruitment agency instead of in-house functions.

Human resources professionals should use tables like this one when presenting options to management teams. These tables allow management teams to understand the strengths and weaknesses of each option which allows them to make an informed decision as to which option is most appropriate for their organisation.




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Learning activity: Case study: Identifying options Read the DuPont scenario provided in the Appendix at the end of this book. DuPont is a large company that required an updated approach to HR. Once you have read the four options identified by the workgroup outline some possible advantages and disadvantages to for each option in the space provided below. Decide on an option, then read the case study conclusion provided below. Advantages

Disadvantages

Option 1

Option 2

Option 3

Option 4

Which option would you recommend for DuPont?



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Case study: Conclusion In the decision process DuPont quickly eliminated Option 1 and Option 2. The changes were not drastic enough and seem to be only steps to reach higher economy of scale. Option 3 and option 4 focus on responding to both challenges identified by Tim Farrell. They allow HR to harmonise processes and reduce the time spent on administrative tasks. The geographic separation of HR tasks and the centralisation of administrative processes further help in implementing a clear definition of roles and responsibilities. In June 2001, DuPont decided to select option 3 and planned to build a shared service centre (SSC) in Asturias, Spain. In April 2002 the centre called ‘CallHR’ went live for the first country. By July 2004 ten countries completed the transition of administrative services to the SSC, and by the end of 2005 DuPont decides to outsource the SSC to Convergys. Convergys is one of the global leaders in providing HR Services.

Assess costs and benefits for delivery options In determining options and strategies for service delivery, you will need to consider the costs of options and the benefits associated with each. The most commonly used measure of cost versus benefit is the return on investment (ROI). Another consideration is risk management. Risks may be associated with each option and represent uncertainty for organisations. Let’s look at cost, cost-benefit analysis and risk management in greater detail.

Cost When presenting options for the delivery of human resources services it is important to include information regarding the costs of each option. This involves identifying all of the associated costs – both set-up and ongoing costs for each option – and presenting those costs to management teams to allow them to compare cost implications of each model. Human resources service delivery model costs could include: ● salaries and wages ● on-costs, the additional costs on top of salaries such as superannuation, workers

compensation, payroll tax, etc. ● recruitment of resources (set-up cost only) ● technology and systems (set-up and ongoing costs) ● office space and equipment (set-up and ongoing costs) ● external consulting costs (if applicable) ● other costs (stationery, travel, venue hire for training, printing, etc.).

Cost can be presented using tables such the following example.




Item description Option A: Centre of Excellence

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Cost ($)

Set-up costs Recruitment

$25,000

Technology and systems

$45,000

Equipment

$30,000

Total set-up costs

$100,000

Ongoing costs (annual) Salaries and wages

$250,000

On-costs

$35,000

Technology and systems Other costs

$15,000

Total ongoing costs Option B: Generalist

$5,000

$305,000

Set-up costs Recruitment

$45,000


$45,000

Equipment

$30,000

Total set-up costs

$120,000

Ongoing costs (annual) Salaries and wages

$300,000

On-costs

$42,000


$5,000

External consulting

$80,000

Other costs

$25,000

Total ongoing costs

$452,000

The total costs for each option are presented in the following cost comparison table: Option

Total set-up costs

Total ongoing costs (annual)

Total costs (for initial year)

A. Centre of Excellence

$100,000

$305,000

$405,000

B. Generalist

$120,000

$452,000

$572,000



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Cost-benefit analysis Costs are not the only consideration for organisations, otherwise the least-cost option would always be chosen. Benefits must also be considered and weighed against the total costs of options. Cost-benefit analysis involves identifying the costs of an action (such as implementing a HR model) and assessing the benefits to the organisation as a result of taking this action. Essentially, the benefits to the organisation should outweigh the costs associated with implementing and operating the model. The evaluation of options may be as simple or complex as required. Evaluation may require only a projected income against cost. On the other hand, for actions that will have a longer-term impact, you may need to determine the future value of revenues, future operational costs, depreciation of assets such as HR software systems, for example, to fully account for all costs and benefits associated with the provision of services. If a cost-benefit analysis is required, at a minimum, you should at least provide a detailed list of costs alongside the associated benefits. This breakdown will assist decision-makers in their determination whether to proceed with the proposed action or to decide on a modified approach to the action.

Return on investment calculation A key concept in cost-benefit analysis is return on investment (ROI). Calculating ROI allows you to quantify and compare the relative value to organisations of different approaches and options. In order to calculate the ROI of an option, you need to be able to express benefits in terms of dollar values. For example: ● How much extra revenue will sales people be able to generate through time-savings

or increased sales skills? ● How much money will the organisation save through increased efficiency or

reduced recruitment or delivery costs? Often such values must be estimated and are subject to a fair amount of uncertainty. The basic formula for ROI is:

ROI is thus presented as a percentage. For example a negative percentage would represent a loss; 10% may represent a modest gain, comparable to financial investment. Gains of over 100% indicate a strong positive return.




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HR and risk management A risk assessment should always be completed before implementing a service delivery model. According to the risk management standard, AS/NZS ISO 31000:2009, risk assessment comprises the overall process of: 1. Risk identification. 2. Risk analysis to determine the nature and level of risk. 3. Risk evaluation to determine the acceptability of the risk and the necessity for implementing controls. 4

Risk associated with the delivery of HR services You will need to closely examine options to identify sources of risk. For example, one risk could be that an option for HR service delivery may be seen as incompatible with organisational practices and rejected by staff. This would be a high risk option that should not be chosen as the best option. To perform an analysis of risk, you will need to identify the consequences of risk and the risk likelihood. In financial terms, the consequence of risk is expressed in dollar terms: how much is at stake? The likelihood of risk is often expressed as a probability represented by a decimal fraction, for example, 0.10 or 10%. A risk of 10% can be considered also as a likelihood of success of 90%. Multiplying consequence (in dollar terms) by likelihood gives you a value for the risk that can be factored into or cost-benefit analysis to give you the expected value or risk-weighted value of the projected benefit. For example you may wish to determine the risk level associated with reduced recruitment costs due to implementation of a service delivery option. The anticipated cost saving is $500,000. The estimated likelihood of success is 90%. Therefore the riskweighted projected benefit is $450,000. The basic formula for ROI weighted for risk is: (

)

In the example above where the anticipated cost saving is $500,000 and the riskweighted projected benefit is $450,000, let’s assume that the cost of this option is $375,000. In this case, ROI weighted for risk would be calculated as follows: (

)

Standards Australia, 2009, AS/NZS ISO 31000:2009 Risk management – principles and guidelines, p. 4. 4



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Once you have performed risk analysis, you will need to determine whether the risk or the expected value of the benefit is acceptable to the organisation. If not, you may need to consider other options in order to offload risk to others. For example, you may consider outsourcing some functions or purchasing insurance. You may also need to consider less risky options or consider ways to implement the option that will more effectively control the risks. Learning activity: ROI and risk management Consider the total set-up costs of options A and B for the initial year of each option (provided in the cost analysis on page 32). Now consider the following information: Option

Projected benefit

A. Centre of Excellence B. Generalist

Likelihood of success

$800,000

0.80

$1,000,000

0.90

Calculate the ROI and the risk weighted ROI for each option.

Develop strategies and action plans Once the most appropriate delivery model has been identified it is time to develop and agree on the strategies and action plans for the delivery of human resources services.

Service delivery models, strategies and action plans The simplest way to describe the difference between the human resources service delivery model, strategies and actions plans is as follows. The HR delivery model

The delivery model is how the human resources team is structured to support the business (some delivery models are listed on page 18). For example, support could be provided through a: 1. self-service model 2. centres of excellence model 3. outsourced model 4. business partner model.




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The HR strategy

The human resources strategy details how services are managed across the business to support the achievement of the organisation’s vision and goals. For example, the recruitment and selection strategy defines the organisation’s approach to attracting and retaining the right people to ensure the organisation has the resources it needs to achieve its goals.

Action plans

Action plans detail how the strategies are implemented across the business. For example, the recruitment and selection action plan details exactly what activities need to be undertaken and who is responsible for developing and implementing the policies and procedures for recruitment and selection. This includes the policies and procedures for activities such as: managing applications (internal and external), assessing candidates, checking references and making job offers.

Developing strategies Human resources professionals are responsible for developing the strategies to deliver human resources services that support the business to achieve their vision and goals. The model below describes the process for developing human resources service strategies. Organisation vision and strategic goals

Human resources strategic goals

Hiring strategies

Motivation, maintenance and retention strategies

Motivation strategies

● Performance

● Workforce

planning ● Recruitment and selection


management ● Remuneration and benefits ● Learning and development ● Work health and safety ● Employee relations

● Termination ● Resignation ● Redundancy ● Retirement


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Hiring strategies Hiring strategies need to be in place to ensure that the organisation has the ‘right resources’ at the ‘right time’. It includes functions such as workforce planning to forecast needs and recruitment and selection to acquire those resources.

Motivation, maintenance and retention strategies These strategies will set out programs that manage, reward and recognise performance and provide employees with opportunities to grow and develop. These programs are focused on engaging, motivating and retaining employees once they have been hired. It also includes programs that maintain employee relations through ensuring compliance with legislative requirements such as health and safety and industrial relations laws.

Separation strategies Separation strategies provide policies and procedures for managing both voluntary and involuntary separations. When developing these strategies, human resources professionals need to consider the vision and goals of the organisation as these will influence the focus areas of these strategies. For example, an organisation that is focused on reducing operations and making employees redundant would not benefit from having strategies focused on hiring. It is far more valuable to the organisation to focus on strategies that motivate the employees that need to be retained to perform in the reduced operation and manage the separation of those employees impacted by redundancy. Example: JMH Insurance JMH Insurance specialise in providing car insurance to its customers across Australia. It has a contact centre based in Melbourne to manage new business and existing customer enquiries. The organisation currently employs 500 employees including those in management roles. The business has experienced substantial growth in the last 12 months and is looking to expand operations over the next 12 months. It will be opening a new contact centre in Sydney in six months’ time which will increase staffing levels by approximately 200 employees over a two year period. Human resources services are currently provided through a business partner model with two human resources business partners based at the Melbourne site who support line managers in their resourcing needs. The two human resources business partners provide all human resources services themselves. After realising the vision and strategic goals of the organisation the human resources manager knew the organisation’s human resources services delivery model and strategy needed to be reviewed to ensure it supported the achievement of these goals. The human resources manager developed the following service delivery model and strategies for the provision of human resources services for the business.




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JMH Insurance Human resources services strategic goal To provide human resources services that support the growth of the organisation through a focus on attracting and retaining key talent, fostering a high performance culture through rewarding exceptional performance and providing learning and development opportunities. Service delivery model Human resources services will be delivered through a human resources business partner model supported by outsourcing some functions to third-party specialist providers. Service strategies Hiring strategies Workforce planning

Human resources business partners to work with business leaders and line managers to forecast required staffing levels to ensure resources are available at the right time.

Recruitment and selections

Human resources business partners to work with third-party recruitment providers and line managers to recruit and select the right people at the right time.

Motivation, maintenance and retention strategies Performance management

Human resources business partners to support business leaders and line managers to implement performance management programs to ensure a high performance culture.

Remuneration and benefits

Human resources function to develop and implement a remuneration and benefits program that provides business leaders and line managers with a tool to reward exceptional performance.

Learning and development

Human resources function to develop and implement learning and development programs that provide employees with an opportunity to increase their skills and capabilities.

Work health and safety

Human resources business partners to work with third-party WHS and injury management specialists to support business leaders and line managers to provide a safe working environment and comply with legislative requirements.

Employee relations

Human resources business partners to provide guidance and support to business leaders and line managers to ensure that employee relations are managed in compliance with legislation and organisational policies and procedures whilst at the same time maintaining employee engagement.



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Separation strategies Termination Resignation Redundancy

Human resources business partners to provide guidance and support to business leaders and line managers to manage employee separations according to legislative requirements and organisational policies and procedures.

Retirement Learning activity: Develop strategies You are the new human resources manager at either of the following simulated businesses: ● Australian Hardware ● CoffeeVille.

Simulated business information, including business and operational plans, financial information, and policies and procedures (including performance management) can be located online at . The management team has asked you to develop a strategy for the provision of human resources services for the business. They want a model that will support the goals of the organisation. What service delivery model would you recommend and why?




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What would be the focus areas of your service strategy and why?

Document the service strategies you might deploy for each of the following strategic focus areas; (For help with completing this activity, refer to the example above for JMH Insurance). Hiring strategies Workforce planning

Recruitment and selections



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Motivation, maintenance and retention strategies Performance management

Remuneration and benefits

Learning and development

Workplace health and safety

Employee relations

Separation strategies Termination

Resignation

Redundancy

Retirement




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Develop action plans As previously discussed, action plans detail how the strategies are implemented across the business. They detail all the tasks involved in implementing the strategy, who is responsible for completing each task and when it will be completed. Action plans also provide a schedule for tracking who is responsible for what by when.

Roles and responsibilities When determining strategies for the delivery of human resources services it is critical that you clearly define the roles and responsibilities of: ● human resources team members ● line managers ● third-party providers.

Failing to clearly outline who is responsible for what can result in confusion and a failure to complete tasks in time causing disruptions in the organisation’s performance and lowered productivity. Roles and responsibilities are best defined when documenting and agreeing the policies and procedures that will be implemented to manage the provision of the service. Example JMH Insurance When completing the action plan for the implementation of the recruitment and selection strategy for JMH Insurance the human resources manager included the following tasks: ● recruitment policies to be agreed upon, documented and posted on the employee

intranet ● recruitment procedures to be agreed upon, documented and posted on the

employee intranet. It is during the completion of these two tasks that the roles and responsibilities of the human resources team, line managers and third-party providers should be detailed. For example, the procedure for advertising a vacant role was documented at JHM Insurance as follows. No. Process step

Who is responsible

1

Vacancy identified.

Line manager

2

Position description completed.

Line manager

3

Request for hire completed and sent to third-party Line manager recruitment provider (including copy of position description).

4

Draft advertisement completed.

Third-party provider

5

Draft advertisement reviewed and approved.

Line manager



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No. Process step

Who is responsible

6

Approved advertisement sent to human resources business partner.


7

Advertisement posted internally.

HR business partner

8

Advertisement posted externally.


Example: JMH Insurance The human resources manager at JMH Insurance has completed the following action plan to manage the implementation of the organisation’s recruitment and selection strategy. Action Plan Strategy

Recruitment and selection

Strategy goal

Human resources business partners to work with third-party recruitment providers and line managers to recruit and select the right people at the right time.

Strategy owner

Paul Hooper – HR Manager

Action Required

By Who

By When

Third-party recruitment provider panel to be identified.

Paul Hooper

1 March

Service level agreement with third-party providers developed and signed by all parties.

Paul Hooper

15 March

Recruitment policies to be agreed upon, documented and posted on the employee intranet.

Jeremy Hirst

15 March

Recruitment procedures to be agreed upon, documented and posted on the employee intranet.

Jeremy Hirst

22 March

Training provided to third-party recruitment providers regarding JMH Insurance business and operations and recruitment policies and procedures.

Tania Smith

31 March

Recruitment policies and procedures training provided to all business leaders and line managers.

Tania Smith

31 March




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Action Required

By Who

By When

Email sent to all employees advising revised recruitment policies and procedures are available on the intranet.

Paul Hooper

1 April

Implement revised recruitment policies and procedures.

All

1 April

Conduct review of revised policies and procedures to identify any issues with the uptake of the new policies and procedures.

Paul Hooper

1 July

Conduct detailed review of revised policies and procedures.

Paul Hooper

1 October

Learning activity: Action planning Develop an action plan for implementing one of the strategies you identified in the previous learning activity (starting on page 39). Action Plan Strategy Strategy goal

Strategy owner Action Required


By Who

By When


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Agree on strategies and action plans Once the specific human resources service strategies and action plans have been developed, they must be approved by business leaders. This is to ensure that the business supports the way in which the human resources services will be provided. To obtain agreement on the strategies and action plans, human resources professionals should present their strategies and action plans to business leaders. Organisations have varying requirements around the way in which this information is presented for consideration. Some organisations rely on formal processes such as strategy papers or formal presentations to management teams, whereas other organisations take a more informal approach where agreement is obtained through discussion. Human resources professionals must know what type of presentation is expected in their organisation prior to seeking approval. This will ensure that they prepare appropriately for the most effective presentation of their information. Regardless of the format required, when preparing to submit proposals of human resources service strategies and action plans, human resources professionals must ensure that their proposal clearly outlines: ● the goals of the strategy ● how the strategy deliverables link to the organisation’s strategic and operational

plans ● key performance indicators for the strategy (how success of the strategy will be

measured) ● the action plan for implementation.

The proposal should also be: ● supported by data to help demonstrate the benefits of proposed actions to the

organisation, which could include: ○ employee resignation rates ○ employee engagement scores ○ industry best practice information ● concise and professional – managers are often busy and like information presented

concisely. You need to ensure that your proposal and supporting documents detail the strategy and action plans clearly and concisely, but are still presented with enough detail to enable managers to make an informed decision.




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Learning activity: Agree on strategies and action plans As the human resources manager for either Australian Hardware or CoffeeVille, you are required to present your strategy and action plan (as completed above) to the management team to obtain their agreement. The management team requires you to present your strategy and action plan at the next management team meeting. They have advised that while they do not require a formal presentation; they would like you to come to their next management meeting and provide an outline of the proposed strategy and action plan. They need you to demonstrate a clear link as to how the strategy and plan will assist the organisation to achieve its objectives. Plan your strategy and action plan presentation for the management team to obtain their approval of your proposal. Your preparation should include how you will present the following information: ● the goals of the strategy ● how the strategy deliverables link to the organisation’s strategic and operational

plans ● any appropriate performance metrics such as KPIs to help in monitoring

successful implementation ● the action plan for implementation.

It should also include details of any supporting documentation that you would use to support your proposed strategy and action plan.

Section summary You should now understand how to develop a human resources strategy that supports an organisation to achieve its business goals.

Further reading ● Anthony, W., Kacmar, K. and Perrewe, P., 2002, Human resources management: A

strategic approach, South-Western, Ohio, Ch. 11. ● Cole, K., 2001, Supervision: The theory and practice of first-line management,

Pearson Education Australia, Frenchs Forest, NSW. ● Josefowitz, O., 2008, The Global HR Delivery Model (Diploma thesis, Haute École de

Gestion de Genève), available online, viewed January 2014, . ● Kramar, R., et al., 2013, Human Resource Management in Australia, 5th edn,

McGraw-Hill Australia, Part 1: Chapters 1–5.



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● University of Birmingham, Human Resources: HR strategy 2007–2012, available

online, viewed January 2014, . ● Sullivan, J., 2008, ‘Selecting an HR strategy’, WorkInfo.com, viewed January 2014,

. ● Ulrich D., Younger, J., Brockbank, W., Ulrich M., 2012, HR from the outside in: Six

competencies for the future of human resources, McGraw-Hill, USA, Ch. 1–3.

Section checklist Before you proceed to the next section, make sure that you are able to:  analyse business strategy and operational plans to identify human resources requirements  review the business environment and its impact on the organisation's human resources requirements  consult with managers to identify human resources needs in their areas  review the organisation's requirements for workplace diversity  develop HR options that comply with legislative requirements, organisational policies and business goals  develop and agree on strategies and action plans for delivery of human resources services  agree and document roles and responsibilities of human resources team, line managers, and external contractors.



Section 2 – Deliver Human Resources Services

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Section 2 – Deliver Human Resources Services This section is about the skills and knowledge required to manage the delivery of human resources services. Scenario: Delivering the vision at Australian Hardware Connie has now completed her review of the organisation’s HR requirements. She has consulted widely to understand the HR needs of internal stakeholders at every level of the organisation. Connie has also considered the external business environment and how it may impact on the longer-term strategic positioning of Australian Hardware. Connie has modified the HR strategy at Australian Hardware and completed action planning to implement the HR changes. She has also planned regular monitoring of activities to ensure successful deployment. To successfully implement changes however, she will need to: ● ensure the HR unit effectively partners with management to implement HR

changes ● build the credibility of the HR unit to participate in overall Australian Hardware

strategic planning ● work to build Australian Hardware’s capability through delivery of HR services

and facilitating learning and development throughout the organisation ● effectively manage change ● innovate and integrate HR strategies and process with Australian Hardware

management systems ● use technology effectively.

All of the above will be essential to effectively delivering on the vision of Australian Hardware where the work is actually done: in the stores, providing value to customers. One of the key next steps Connie will take is to finalise agreement on Service Level Contracts for the delivery of HR services to business partners.

What skills will you need? In order to work effectively as a human resources professional, you must be able to:  develop and communicate information about human resources strategies and services to internal and external stakeholders  develop and negotiate service level agreements between the human resources team, service providers and client groups



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 document and communicate service specifications, performance standards and timeframes  identify and arrange training support if required  arrange monitoring of quality assurance processes  ensure that services are delivered by appropriate providers according to service level agreements and operational plans  identify and rectify underperformance of human resources team or service providers  identify appropriate return on investment in providing human resources services.

Develop service level agreements When managing the provision of human resources services it is important to develop and implement service level agreements to govern the way in which services are provided. Service level agreements clearly define expectations for both the provider and receiver of services. Human resources professionals need to be able to identify where service level agreements are required and how they can be used to ensure service expectations are met. Service level agreements should always be used when using external service providers to deliver HR services and can also be used to manage the delivery of services between departments within an organisation. Case study: Automatic Data Processing Inc. Use the link below to access an interesting article in the Beijing Review e-magazine discussing the increase in the number of organisations outsourcing human resources services. ● ‘Tapping the HR market – The US outsourcing firm ADP is expanding its footprint

in China’, Beijing Review, viewed December 2013, . This article highlights the need for human resources professionals to have skills in managing services provided by external service providers to ensure that the organisation’s human resources requirements are being met. Service level agreements with external providers do not replace contracts for service but support the way in which the services are provided by clarifying aspects of the service such as service specifications, performance indicators, monitoring and maintenance schedules or dispute resolution processes, for example. When developing and negotiating service level agreements with an external provider, it is good practice to engage legal counsel to review the agreement and ensure any legal implications are identified.




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The first step in developing a service level agreement is to identify and agree on the key terms such as: ● start and end date of the agreement

● fees and payment terms for the

services

● scope of services provided

● monitoring and reporting processes

● how services are provided

● dispute resolution processes.

● service level targets

Identifying the key terms of a service level agreement involves the following steps. 1. Document the full process for the service (for example, document the hiring process from application to induction of the new employee). 2. Define who is responsible for each step of the process. This will determine the scope of the services to be provided for each service provider (for example, an external recruitment agency is responsible for all process steps from application to interview and the human resources team will manage the process from interview to orientation and induction). 3. Discuss and agree with external service providers and line managers on: a. applicable fees and payment terms b. service level targets c. monitoring and reporting processes d. dispute resolution processes. Example JMH Insurance The human resources manager at JMH Insurance has identified a need to develop a service level agreement for the advertisement of vacant roles. This agreement will be used to provide clear expectation for all parties involved in the process and to ensure that all vacant roles are advertised according to organisational requirements. The HR Manager at JMH Insurance documents the process as follows. No. Process step

Who is responsible

1

Vacancy identified.

Line manager

2

Position description completed.

Line manager

3

Request for hire completed and sent to third-party recruitment provider (including copy of position description).

Line manager

4

Draft advertisement completed.


5

Draft advertisement reviewed and approved.

Line manager

6

Approved advertisement sent to human resources business Third-party provider partner.



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No. Process step

Who is responsible

7

Advertisement posted internally.

HR business partner

8

Advertisement posted externally.


The HR Manager then met with the line manager and external service provider to discuss and agree the following key terms of the service level agreement. ● This agreement commences on 1 January 201X and ceases on 31 December

201X. ● JMH Insurance line manager to provide completed ‘Request for Hire’ form and

position description to third-party provider. Quality information is to be provided. ● Advertisements are completed using templates provided by JMH Insurance. ● Draft advertisement to be received within 24 hours of receipt of ‘Request for

Hire’ and position description. ● Final advertisement to be received within 24 hours of approved advertisement. ● $100 is payable per advertisement produced once the advertisement is posted

internally and externally. ● Achievement against target reports will be produced monthly, by JMH Insurance,

and used to monitor performance. ● All issues/complaints are to be resolved in consultation with the human

resources manager at JMH Insurance and the account manager of the third-party provider. Issues must be raised with 48 hours of occurrence.

Learning activity: Service level agreements You are the new human resources manager at either of the following simulated businesses: ● Australian Hardware ● CoffeeVille.

In previous activities, you have identified service delivery options, strategies and action plans for the delivery of strategies, including roles and responsibilities. Imagine you are responsible for negotiating a service level agreement with an external provider to deliver some aspect of service to managers, employees or business units. What specifications would you suggest to include in the agreement to cover business needs? Consider the scope of service and performance measures in particular. Simulated business information, including business and operational plans, financial information, and policies and procedures (including performance management) can be located online at .




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Negotiate service level agreements Human resources professionals are required to work with business leaders and service providers to agree on the key terms of a service level agreement. This often requires good negotiation skills.

Negotiation skills Negotiation skills help you to resolve situations where what you want conflicts with what someone else wants. The aim of negotiation is to explore the situation to find a solution that is acceptable to both parties. The style used to manage a negotiation largely depends on the long term relationship requirements of the person you are negotiating with. If you are never going to see or deal with a person again you may choose a style that is focused on getting what you want without consideration of the other person’s needs. For example, when buying a car, the buyer and seller participate in a negotiation of a price. As there is generally no long-term relationship after the purchase, neither party cares about how the other person feels at the end of the negotiation; they just care about the end result for themselves. This often results in a tough negotiation where each party competes for their desired outcome. However, if you are going to have to deal with the person again in the future, then maintaining a positive relationship can be quite important. A more collaborative style would is a more appropriate negotiation style when you need to maintain a positive relationship. This is often the case in the workplace where negotiations with colleagues and long-term or regular internal or external clients occurs on a daily basis.

Preparing for a successful negotiation It is often good practice to prepare for negotiations. This allows you to identify the things that are most important and therefore ‘not negotiable’ and those things that you are willing to compromise on. When preparing to negotiate the terms and conditions of service level agreements you should consider the following. Objective

What do you want out of the negotiation? For example; range of services, best price. resources. What out of these is most important?

Trades

What are you willing to trade on? What do you have that the other person may want that could be used to trade with? For example, when negotiating with external service providers, are you willing to give them more business if they give you a better price? Or are you willing to pay a higher price for a customised service?



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Contingency


What is your contingency plan if your negotiations fail? Is your contingency plan a viable option? What impact will your contingency plan have on the organisation? (Cost, productivity, reputation, etc.) For example, what is your contingency plan if negotiations with a payroll service provider fail which impacts your ability to implement your HR strategy to outsource payroll?

Background

What is the background of your relationship with the person you are negotiating with? Have relationships in the past been positive or negative? Have negotiations in the past typically worked well with both parties happy with the outcome?

Options

What are some suitable options that may satisfy the needs of both parties? Identifying options that consider the needs of the other party demonstrates a commitment to participate positively in a negotiation. This can often help with building rapport with the other party and setting the scene for a constructive and successful negotiation.

Negotiating successfully Negotiation involves finding a solution that meets the needs of all parties. It involves each party understanding and valuing the needs of the other and exploring possible solutions that meet as many of those needs as possible. A successful negotiation usually involves: ● compromise ● open and honest communication ● innovative thinking ● teamwork.

Conflict management Often when negotiating contracts or agreements, conflict arises. For this reason, having good conflict management skills is important. Managing conflict requires you to use different approaches depending on the desired outcome.




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Conflict management styles Below are five styles that are used to manage conflict. These styles are also often used when completing negotiations. Competing

When both parties compete against each other for a resolution. A competitive style involves: ● insisting on having your needs met ● winning at all costs ● causing serious damage to relationships and trust ● may not get the best decisions.

For example, when buying a car, the buyer and seller compete against each other with regards to the price. Neither party cares about the other’s needs or wants; they just care about the end result for themselves. Accommodating

When one party accommodates the needs of the other to the extent that their needs do not form any of the solution. An accommodating style involves: ● giving in to the other person ● allowing the other person to win without attempting to have

your own needs met ● acting in a non-threatening manner ● not sharing ideas.

For example, accommodating might be used when a customer is unhappy with a product and wants a refund and the retailer accommodates their needs and provides a refund. Avoiding

When one party avoids conflict with another resulting in the conflict not being resolved. An avoiding style involves: ● refusing to engage in conflict ● ‘pulling your head in’ and avoiding an argument ● neither party winning as the issues aren’t discussed or

resolved. For example, when a manager avoids managing a poorly performing employee because the employee has become aggressive.



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Collaborating


When the two parties work together to find a mutually agreeable solution. A collaborating style: ● involves both parties being fully satisfied ● requires extensive questioning ● requires understanding of the other person’s point of view.

For example, when a HR manager and a service provider together identify a solution regarding the implementation of a new system. Compromising

When both parties give something up to reach a mutually agreeable solution. This means that the needs of either party are not entirely met but both parties are satisfied with a solution that meets some of their needs. A compromising style: ● maintains good relationships ● demonstrates that your needs are important ● utilises assertion.

For example, when an organisation and a service provider negotiate the terms and conditions of a service level agreement. This is the most appropriate style for a successful negotiation as it ensures ‘win-win’ for both parties and maintains positive relationships.

Choosing the right style

Assertiveness

Competing

Collaborating

Compromising

Avoiding

Accommodating

This diagram demonstrates the relationship between intentions and the different conflict management styles. It shows that if your intention is to satisfy your own concerns then the appropriate styles would be ‘avoiding’ and ‘competing’. However, if your intention was to also satisfy the concerns of the other party involved then the appropriate styles would be ‘accommodating’ and ‘collaborating’.

Level of cooperation BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd



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Techniques for resolving conflict Resolving conflict can be very difficult; however, the following technique is useful for effectively dealing with workplace issues. Step 1 Initiate a discussion

● Open the discussion with a clear statement that explains why

you have requested the discussion. ● Communicate openly and honestly. ● Do not lay blame. ● Ensure you have allocated enough time to complete the

discussion. Step 2

● Clearly state your point of view.

Give good information

● Use ‘I’ language, e.g. ‘I think …’ or ‘I feel …’ ● Don’t be emotive. ● Explain how the conflict has affected you. ● State your opinion accurately and assertively.

Step 3

● Use active listening.

Gather good information

● Ask questions to clarify details. ● Be empathetic. ● Don’t be defensive or confrontational. ● Remember, you don’t have to agree with what the other

person is saying … you just have to understand what they are saying. Step 4

● Summarise the problem.

Problem solve

● Identify the conflicting needs of each party. ● Agree on what the problem is. ● Brainstorm solutions together – think innovatively. ● Together choose a mutually acceptable solution.5

Cole, K., 2001, Supervision: The theory and practice of first-line management, Pearson Education, NSW, pp. 735–736.

5



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Learning activity: Negotiating service level agreements Suppose you are the new human resources manager at Australian Hardware or CoffeeVille. You are negotiating the service level agreement you began to sketch out in the previous learning activity (on page 51). Unfortunately, you disagree with the external party on the scope of the services to be provided. What services are provided and to what standard is, for you, non-negotiable. You also disagree on the price. They are proposing to charge 40% more than you would like to pay to include the required services within the scope of the agreement. You have, however, authorisation from the board of directors to pay 15% more and would be willing to do so if you could be assured of a sufficiently high quality of service. The negotiations have become heated and the other party has threatened to walk out on negotiations. You know that an agreement needs to be made. It’s in both party’s interests. Outline the approach you would take to reach agreement.




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Document service level agreements Once the key terms of the service level agreement have been agreed upon between human resources team members, line managers and external service providers, as applicable, the service level agreement should be documented. Documenting service level agreements is essential because it is what commits the parties to the agreement. It involves using the agreed key terms to document the detailed service specifications, performance standards and timeframes for the services to be provided. However, before we move on to documenting these components it is important that you are familiar with the format of service level agreements. Learning activity: Documenting service level agreements Research examples of service level agreements. If you are currently employed you should try and find examples within your workplace. If you are not currently employed you can access examples on the internet. Consider the following examples: ● Birkbeck, University of London HR

. ● Johns Hopkins HR/Payroll Shared Services

. Review the examples that you find and answer the following questions. How is the information formatted?

What information is included?

Does your example include more than just information about service specifications, performance standards and timeframes? If yes, what additional information does it include?



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How are service specifications, performance standards and timeframes of a service level agreement documented? For example do they use process flow charts or tables, are the time frames short (daily) or long (weekly, monthly), are specific performance targets provided such as time based measures, quality measures, cost measures, etc.? Service specifications

Timeframes

Performance targets

Service level agreements typically follow a format such as that shown below. Services Agreement for services provided by Contents 1. Service level agreement – page <number> 2. Scope of services – page <number> 3. Fees and payment terms – page <number> 4. Service level targets – page <number> 5. Monitoring and reporting – page <number> 6. Dispute resolution – page <number> 7. Signing page – page <number> BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd 1st edition version: 1 Page 59 of 120 Section 2 – Deliver Human Resources Services Student Workbook 1. Service level agreement Service level agreement dated: <insert date> Between <Insert service provider name> Service level agreement Sponsor – <Insert name of Service level agreement sponsor> And <Insert organisation/business unit> Service level agreement Sponsor – <Insert name of Service level agreement sponsor> 2. Scope of services <Insert a short summary of the scope of services to be provided>. Service specifications The table below describes the services to be provided under this Services Agreement. <Insert details of all the services to be provided and the scope of those services>. Service Scope <Insert more rows as required> 3. Fees and payment terms The schedule below details the fees and payment terms for the services provided under this agreement. <Insert fee and payment terms for each service provided> Service Fee Payment term <Insert more rows as required> 4. Service level targets Services provided under this agreement will be measured against the following performance standards and timeframes. <Insert the performance standards and timeframes for each service provided> 1st edition version: 1 Page 60 of 120 BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd Student Workbook Section 2 – Deliver Human Resources Services Service Performance standard and timeframe <Insert more rows as required> 5. Monitoring and reporting Services will monitored according to the following reporting schedule. <Insert details of the reports and timing of those reports that will be used to monitor the performance of each service provided> Service Report Timing <Insert more rows as required> 6. Dispute resolution In the event that either party needs to raise a dispute the following process must be followed: <Insert dispute process – see example process below> Issue identified Service level agreement Sponsor from both parties to be notified of issue Service level agreement Sponsor from both parties to discuss issue and agree resolution In the event that service level agreement Sponsors cannot agree on a resolution the issue is to be escalated to contract management for resolution under contract management processes. BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd 1st edition version: 1 Page 61 of 120 Section 2 – Deliver Human Resources Services Student Workbook 7. Signing page I agree to the terms and conditions of this agreement. Signed for and on behalf of <Company name/business unit> <Insert company name/business unit> <Signature of authorised representative> In the presence of <insert name of witness> <Signature of witness> Signed for and on behalf of <Service provider company name/business unit> <Insert company name/business unit> <Signature of authorised representative> In the presence of <insert name of witness> <Signature of witness> Documenting service specifications Documenting service specifications involves detailing all of the services that will be provided and how they will be provided. This includes: ● roles and responsibilities of those involved ● what is produced/provided ● technology requirements ● resource requirements. Example JMH Insurance The human resources manager at JMH Insurance has completed the following service specifications table to be included in the service level agreement for the third party who is providing services for developing and posting job advertisements. External provider service specifications – Job advertisement services Draft job advertisement ● The external provider will complete the draft advertisement using JMH Insurance’s job advertisement templates and the information provided by the line manager in the ‘Request for Hire’ form and position description. ● Draft advertisements must be sent to the line manager for approval via email. 1st edition version: 1 Page 62 of 120 BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd Student Workbook Final job advertisement Section 2 – Deliver Human Resources Services ● The external provider must incorporate feedback from the line manager in the final version of the advertisement. ● The external provider must send the amended advertisement to the line manager for approval. ● The external provider must send the final job advertisement to the line manager and the human resources manager. ● The external provider must keep a record of all advertisements completed for future reference. Advertise the position externally ● The external provider must obtain quotes for posting the job advertisement externally. ● The external provider must provide quotes to the line manager for approval. ● Once approval for the advertising cost has been received, the external provider is to post the approved job advertisement externally. Records management ● The external provider must keep a record of all advertisements completed for future reference. ● The external provider must keep a record of all advertising costs. Service reporting ● The external provider must complete and provide monthly reporting for: ○ number of roles advertised externally ○ costs of advertisements. Documenting performance standards and timeframes Performance standards and timeframes are used to agree how service performance will be measured. Performance standards and timeframes must clearly detail what the expected level of performance is, how it will be measured and timeframes applicable for the service. Example JMH Insurance The human resources manager at JMH Insurance has completed the following table to be included in the service level agreement for the external service provider detailing the performance standards and timeframe for developing and posting job advertisements. BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd 1st edition version: 1 Page 63 of 120 Section 2 – Deliver Human Resources Services Student Workbook Performance standards and timeframes – Job advertisement services Draft job advertisement ● 100% of draft advertisements to be received by the relevant line manager within 24 hours of the ‘Request for Hire’ form and position description being provided to the service provider. ● 100% of draft advertisements completed using JMH Insurance job advertisement template. Final job advertisement ● 100% of amended advertisements to be received by the relevant line manager within 24 hours of feedback being provided to the service provider. ● 100% of final advertisements to be received by the relevant line manager within 24 hours of approval being provided to the service provider. Advertise the position externally ● 100% of quotes provided to the relevant line manager within 24 hours of the final advertisement being provided to the service provider. ● 100% of external job advertisements posted within 24 hours of approval for the quote being provided to the service provider. Records management ● 100% of advertisements stored in accordance with organisational recordkeeping policy. ● 100% of advertising costs recorded. Service reporting ● The external service provider must complete and send to the JMH Insurance human resources manager the following reports by the 10th day of every month: ○ number of roles advertised externally for the previous month and year-to-date ○ costs of advertisements for the previous month and year-to-date. Learning activity: Documenting service specifications Using the service specifications and other details you have prepared in previous learning activities and an appropriate template, document a formal service level agreement. Ensure you cover the essentials: ● scope of services ● service level performance targets and/or performance metrics (how performance will be measured) ● monitoring and reporting schedule ● dispute resolution procedures. 1st edition version: 1 Page 64 of 120 BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd Student Workbook Section 2 – Deliver Human Resources Services Training requirements When discussing the terms of the agreement it may become apparent that training is required for some parties. Training often assists with compliance with the terms of the agreement as it ensures that all parties understand what they are expected to do under the agreement and to what standard. Training requirements could include the following. Who Human resources team members Potential training requirements ● policies and procedures specific to the services they provide ● business unit orientation and induction ● service level agreement management ● reporting ● negotiation skills ● relationship management. Line managers ● policies and procedures specific to the services they provide ● service level agreement purpose and functions ● service provider capabilities. External service provider ● organisational orientation and induction ● organisational structure, roles and responsibilities ● organisational policies and procedures specific to the services to be provided. Example JMH Insurance The human resources manager at JMH Insurance has identified the following training requirements to ensure the successful implementation of the service level agreement that has been developed to manage the services provided by an external service provider for job advertisements. Who JMH Insurance human resources team members Potential training requirements ● recruitment and selection policies and procedures ● service level agreement management ● reporting ● communication skills ● negotiation skills. BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd 1st edition version: 1 Page 65 of 120 Section 2 – Deliver Human Resources Services Who Student Workbook Potential training requirements JMH Insurance line managers ● recruitment and selection policies and procedures Third-party service provider ● JMH Insurance orientation and induction ● writing effective position descriptions. ● JMH Insurance recruitment and selection policies and procedures. Learning activity: Training Consider the service level agreement you documented in the previous learning activity. What training might be required to implement the agreement? Develop an action plan to provide for the training needed. Remember to provide as much detail as required: ● activities ● timelines ● strategies or approaches ● monitoring of effectiveness ● resources ● roles and responsibilities. Quality assurance Quality assurance is about managing business processes to ensure that both the service provider and the client are satisfied with the quality and consistency of the services provided. Quality assurance programs: ● ensure quality is built into the process ● focus on preventing problems ● monitor quality constantly ● check for quality at every stage of the process ● rely on everyone. 6 Effectively managing human resources services involves working with internal or external service providers and the business to ensure that the processes in place support the consistent delivery of a quality service. This includes agreeing with line managers and service providers what is to be included in the quality assurance program and how the program will be monitored. Cole, K., 2001, Supervision: The theory and practice of first-line management, Pearson Education, NSW, p. 263. 6 1st edition version: 1 Page 66 of 120 BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd Student Workbook Section 2 – Deliver Human Resources Services Quality assurance program for human resources services The components of a quality assurance program for human resources services could include: ● service reviews; where feedback from all users of the service is obtained ● checklists used by service providers to ensure that all steps of a process are followed ● policies and procedures that provide rules of how services are to be completed ● benchmarks and performance objectives or standards that provide service providers with guidance on acceptable service levels. Example JMH Insurance The human resources manager at JMH Insurance has developed the following quality assurance program to ensure that job advertisements are produced at a consistently high standard each and every time. ● Line managers are provided with a template to complete a ‘Request for Hire’ form to ensure the service provider receives all the necessary information to complete a job advertisement. ● Line managers are provided with a checklist and template to ensure that all position descriptions contain all of the information required to produce a quality job advertisement. ● Job advertisement templates are provided to the service provider to ensure a consistent format. ● Benchmark costs are provided to the service provider to provide guidance with regards to acceptable job advertisement costs. ● JMH Insurance recruitment and selection policies and procedures include specific information and guidance with regards to the production of job advertisements. ● Feedback is sought from all candidates who are interviewed regarding the quality of the job advertisement and how useful it was in providing them information about the job and whether it had any impact on their decision to apply for the role. ● Reporting is completed regarding the number draft advertisements completed before a final advertisement is approved. Learning activity: Quality assurance program Develop a quality assurance program for the delivery of HR services at Australian Hardware or CoffeeVille in accordance with the service level agreement that you have created. BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd 1st edition version: 1 Page 67 of 120 Section 2 – Deliver Human Resources Services Student Workbook Monitoring the quality of delivery Once the components of the quality assurance program have been agreed, it is time to agree on how and when the program will be monitored. Most organisations use a quality assurance audit to check that the program is being implemented to agreed standards. How regularly the audit is completed depends on the risks associated with poor quality service being provided. Monitoring could also vary depending on the services being provided. For example, monitoring of payroll or work health and safety would be conducted far more regularly than programs for learning and development. Whatever the timeframes for monitoring, a schedule needs to be developed and agreed on to ensure that all parties are aware of how and when service delivery will be checked. It is important to monitor service delivery against agreed service specifications benchmarks, standards and objectives. Example JMH Insurance The human resources manager at JMH Insurance has developed the following audit tool and schedule for monitoring the quality assurance program implemented for the development and posting of job advertisements. JMH Insurance Quality Assurance Audit Tool – Job Advertisements Audit Question Yes/No Is further review required? If yes, detail requirements. Have all line managers used and completed the ‘Request for Hire’ form correctly? Have all line managers used the position description checklist and template? Has the service provider used the templates provided for completed job advertisements? Has the service provider completed advertisements according to the cost benchmarks provided? Are line managers and service providers completing job advertisements in accordance with organisational recruitment and selection policies and procedures? 1st edition version: 1 Page 68 of 120 BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd Student Workbook Section 2 – Deliver Human Resources Services Audit Question Yes/No Is further review required? If yes, detail requirements. Feedback from candidates interviewed meets or exceeds 85% satisfaction rating? Data demonstrates that 80% or more of draft advertisements produced do not require amendments? Audit Outcome (please tick)  Meets requirements  Further review required JMH Insurance Quality Assurance Audit Schedule – Job Advertisements Audit No. Date to be completed 1 1 March 201X 2 1 June 201X 3 1 September 201X 4 1 December 201X Result Obtaining agreement on quality assurance programs Agreement from all responsible parties in the provision of human resources services must be obtained for the overall approach to quality assurance as well as the method used to monitor that programs are being implemented as required. The most effective way to obtain agreement is to document the components of the program including the audit plan and schedule of activities and circulate those documents to all parties for feedback and agreement. This will ensure that all parties are given the opportunity to contribute ideas that may improve the tools that have been developed and also ensure that all parties are aware of the program being implemented and support the process. Learning activity: Quality assurance audit tool Develop a quality assurance audit tool for the quality assurance program you developed in the previous learning activity. BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd 1st edition version: 1 Page 69 of 120 Section 2 – Deliver Human Resources Services Student Workbook Quality Assurance Audit Tool Audit Question Yes/No Is further review required? If yes, detail requirements. Audit Outcome (please tick)  Meets requirements  Further review required Protecting the expected return on investment In the previous section, we discussed risk management and return on investment. As you manage the provision of HR services you will need to implement monitoring and audit strategies to ensure services comply with the organisation’s HR requirements. Doing so will help minimise risk to your organisation’s investment in the HR delivery strategy and ensure financial and other benefits are ultimately realised. After a specified or appropriate term of service has elapsed, it is good practice to calculate actual return on investment and compare this with projected figures. Regularly recalculating ROI can help managers to evaluate the business impact of service delivery early and take appropriate actions to address underperformance. 1st edition version: 1 Page 70 of 120 BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd Student Workbook Section 2 – Deliver Human Resources Services Learning activity: Ensuring the effectiveness of the services provided What strategies have you used in the past to ensure that a service provider (in any area) was appropriate for providing the services you required, and how did you measure the effectiveness of services provided? This could be an example of service provided in the workplace by an internal or external service provider. How effective were these strategies and why? Were the strategies you deployed able to minimise the risk posed by poor service provision and protect your anticipated return on investment? Could you apply these same strategies when implementing a services agreement for the provision of human resources services? Why? BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd 1st edition version: 1 Page 71 of 120 Section 2 – Deliver Human Resources Services Student Workbook Identify and rectify underperformance Services provided under a service level agreement need to be regularly monitored and reviewed to ensure that any underperformance is identified early and rectified before major damage is caused. You should monitor the services being provided to ensure that: ● services are being provided as per service specifications ● performance standards and timeframes are being met ● clients are satisfied with the services being provided ● costs remain within budget ● there is a positive return on investment. Performance can be monitored using a number of methods, for example, by reviewing: ● graphs and charts, such as those that appear in dashboard reports for project implementation and monitoring business key metrics ● organisational, divisional, business unit, personal or individual balanced scorecards ● data gathered through HR management systems such as absenteeism rates, service completion times ● formal evaluation reports ● feedback (informal, through surveys or audits) ● interviews with line or senior managers affected by service performance ● financial records (statement of financial performance, statement of financial position, cash flow) and account balances. Monitoring is a process that assists human resources professionals measure or assess the performance of service providers. When there is unsatisfactory performance, prompt action needs to be taken to ensure the situation is rectified and organisational goals are achieved. There are five types of corrective action that can be used: Interim Adaptive Corrective Preventative Contingency Let’s look at these types of corrective action in more detail. Interim action This is action that aims to buy time until the real cause of the problem can be identified and fixed. Interim measures aim to minimise the damage of a performance problem until it can be properly addressed, so the actions are temporary actions, for example, temporarily using manual systems to deliver services until technologies can be restored. 1st edition version: 1 Page 72 of 120 BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd Student Workbook Section 2 – Deliver Human Resources Services Adaptive action Sometimes performance targets for HR services are set unrealistically high. There may be a number of valid reasons: errors, over enthusiasm, changes in circumstances and so on. At some point it becomes clear that a performance deficit is inevitable. Adaptive action involves reviewing the performance standards and bringing them in line with the new reality. Care should be taken that this response is not used to ‘cover-up’ poor performance by service providers. Corrective action Corrective action targets the cause of the substandard performance. It is designed to get the performance back on track. Examples of corrective action with respect to personnel delivering services include training or coaching. Preventative action Preventative action removes the cause of potential performance shortfalls before they occur. Effective monitoring provides the early warning system that enables appropriate preventative action to be taken. Contingency action Contingency action is action taken ‘just in case’, or ‘plan b’. It includes actions that are planned during the service delivery planning process, to be taken should risks be realised. Your monitoring system may hint that there is a problem looming that is deemed to be serious enough to warrant contingency action. In many cases the contingency action would be guided by the contingency plan developed as part of the planning process for service delivery. Learning activity: Identify and rectify underperformance What strategies would you use to identify underperformance for the services provided to Australian Hardware or CoffeeVille? Imagine that you have identified that the service provider is failing to provide the services as agreed in the service level agreement. Detail how you would rectify this situation. Amend action planning you completed in Section 1 to include contingency planning for anticipated risks to return on investment. Section summary You should now understand how to manage the delivery of human resources services. BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd 1st edition version: 1 Page 73 of 120 Section 2 – Deliver Human Resources Services Student Workbook Further reading ● Cole, K., 2001, Supervision: The theory and practice of first-line management, Pearson Education, NSW. ● Kramar, R., et al., 2013, Human Resource Management in Australia, 5th edn, McGraw-Hill Australia, Part 1: Ch. 6–7; Part 3: Ch. 10. ● Ulrich, D., Younger, J., Brockbank, W., Ulrich, M., 2012, HR from the outside in: Six competencies for the future of human resources, McGraw-Hill, USA, Ch. 5–9. Section checklist Before you proceed to the next section, make sure that you are able to:  develop and communicate information about human resources strategies and services to internal and external stakeholders  develop and negotiate service level agreements between the human resources team, service providers and client groups  document and communicate service specifications, performance standards and timeframes  identify and arrange training support if required  agree and arrange monitoring of quality assurance processes  ensure that services are delivered by appropriate providers according to service level agreements and operational plans  identify and rectify underperformance of human resources team or service providers  identify appropriate return on investment in providing human resources services. 1st edition version: 1 Page 74 of 120 BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd Student Workbook Section 3 – Evaluate Human Resources Service Delivery Section 3 – Evaluate Human Resources Service Delivery This section is about the tools and methods for evaluating human resources service delivery. Scenario: Measuring HR performance at Australian Hardware It has been eight months since Connie began to implement HR changes at Australian Hardware. Feedback has largely been positive. In a recent audit of HR performance over the organisation, the following results were obtained: ● 85% of managers have high confidence in the ability of store HR officers in delivering services and mediating services delivered by the corporate HR centre of excellence ● 75% of managers believe HR has had a strong impact on business performance. The following breakdown by HR service was obtained: Client value rating/10 Performance Staffing and recruitment 8 ROI = 140% Training and skills development 4 ROI = 130% Performance management 9 55% appraisals completed Rewards and recognition 8 100% at-risk bonus payments processed on time Process 9 98% of administrative requests completed to the requirements of the service level agreement Communication 8 Average of 21 days from disputes being raised to resolution Service 90% training programs completed on time 95% employees agree that the system is fair 90% employees engaged in communication activities to understand application of vision to job role and teamwork Connie will need to continue to monitor HR performance on a regular basis and use the results of data gathering to continuously improve the HR system. BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd 1st edition version: 1 Page 75 of 120 Section 3 – Evaluate Human Resources Service Delivery Student Workbook What skills will you need? In order to work effectively as a human resources professional, you must be able to:  establish systems for gathering and storing information needed to provide human resources services  survey clients to determine level of satisfaction  capture ongoing client feedback for the review processes  analyse feedback and surveys and recommend changes to service delivery  obtain approvals to variations in service delivery from appropriate managers  support agreed change processes across the organisation. Establish systems for monitoring and evaluation It is important to take a systematic approach to monitoring and evaluating HR service delivery performance. Elements of a systematic approach include: Determining what to measure Determining (in advance) what and how to measure performance. What are the targets and objectives that need to be monitored? What are the key performance indicators that will allow you to determine (in advance) the success, failure, and need to intervene? What are the triggers for intervention, that is, the performance levels that will trigger specific actions or contingency plans to keep performance on track? Coordinating monitoring activities Coordinating what and how you monitor in line with the needs and strategic planning of the organisation. How are the goals of the organisation promoted by the monitoring? Are you sure you are measuring the aspects of HR performance that really matter to the business? Regular monitoring Monitoring performance of HR services continuously to ensure you have enough time to act should intervention be required. Documenting processes Planning and documenting approaches to monitoring performance in procedures and planning documents such as action plans. Integrating monitoring into organisational systems Integrating performance monitoring with existing practices and operations. Ensure a smooth implementation of monitoring plans and cooperation of business partners. 1st edition version: 1 Page 76 of 120 BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd Student Workbook Communicating the process Section 3 – Evaluate Human Resources Service Delivery Communicating the monitoring process to involved stakeholders. Include an outline of monitoring activities in service level agreements, for example. In order to take a systematic approach you will need to develop monitoring plans and schedules, keep records and evaluate performance data within a useful framework of evaluation. Monitoring plans You will need to create appropriate and realistic plans or schedules for monitoring activities. You should consider including a schedule or outline of the monitoring plan in service level agreements. Monitoring action plans should include monitoring activities, timelines, and strategies for integrating monitoring activities with existing business culture, practices processes and policies and procedures, resources and clear roles and responsibilities for carrying out monitoring activities. Recordkeeping It is important to enter and store performance information using an effective system of recordkeeping. HR management systems, enterprise resource management systems and accounting systems may capture and store some performance information automatically. Some types of monitoring activities such as the use of audit tools and surveys will require you to make decisions regarding proper storage and file naming. You will need to ensure you follow all organisational policies and procedures for recordkeeping. You will also need to ensure storage of performance information is in accordance with legislation such as privacy laws and ethical business practices. Evaluation frameworks A key part of monitoring HR delivery performance is determining what to measure and evaluate. You cannot ensure your monitoring and evaluating planning aligns with business need if you cannot determine what kinds of measures will give you information on what sort of business performance. It is important, therefore, to work within a clear framework for evaluation. The Kirkpatrick model One well-known model of evaluation is the Kirkpatrick model which describes four levels of evaluation. The Kirkpatrick model was developed to evaluate training programs. The model describes four levels of evaluation: Level 1 – Reaction Reaction evaluation is how the learners felt about the training or learning experience. How do people feel about the training or service quality? Opinion or client satisfaction surveys often give information useful only for level 1 evaluation. BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd 1st edition version: 1 Page 77 of 120 Section 3 – Evaluate Human Resources Service Delivery Student Workbook Level 2 – Immediate or Learning Learning evaluation is the measurement of the increase in knowledge and skills after training. Test scores, skills, abilities or business capabilities objectively scored or observed. This level of evaluation does not include the application of knowledge or skills. Level 3 – Intermediate or Application Behaviour evaluation is the extent of applied learning back on-the-job; implementation of skills and knowledge. Level 4 – Results Results evaluation is the effect on the organisation or environment by the trainee. Does the business realise its financial or other goals as a result of the provision of training? Because this model is tailored to evaluate training programs, it can be difficult to apply the Kirkpatrick levels of evaluation model to evaluating all areas of HR services delivery. The Philips model The Philips model is similar to the Kirkpatrick model, but it is more applicable to evaluating the delivery of HR. This model also incorporates evaluation of return on investment (ROI) 7: Reaction and planned action Measures the participant satisfaction (i.e. the satisfaction of those impacted by HR service delivery) with the service/system and participants’ intentions to act in accordance with the service/system. For example, plans to undertake the tasks that they are responsible for according to HR policies and procedures. Learning Application Measures changes in knowledge, skills or capabilities related to the HR system or services. For example, a line manager’s gain in knowledge about how to follow procedures to fill in a ‘Request for Hire’ form. Measures the application of knowledge, skills or services in the workplace. For example, a line manager’s application of knowledge and skill in filling out a ‘Request for Hire’ form. 7 Phillips, J. and Phillips P., 2010, ‘Measuring Return on Investment in HR a global initiative for HR strategy’, ROI Institute, viewed January 2014 <http://www.roiinstitute.net/m/uploads/tools/ 2010/02/04/MeasuringReturnonInvestmentinHR-AGlobalInitiativeforHRStrategy3.pdf>. 1st edition version: 1 Page 78 of 120 BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd Student Workbook Section 3 – Evaluate Human Resources Service Delivery Business impact Measures the costs and business output related to the HR service delivery program. Return on investment Compares the benefits with the costs. When evaluating the effectiveness of HR service delivery initiatives, it is important to determine in advance the evaluation tools and measures required to determine the right level of evaluation. For example, you cannot claim that a program has helped the organisation achieve its projected return on investment by relying on data gathered from a client satisfaction survey (a tool for evaluation at the ‘reaction’ level). On the other hand, business data may be too high-level to sort out and separate the contribution that HR programs make to the bottom line. Level 1 survey data may, however, indicate a change in attitude that could indicate future business success. Such data can supplement performance data to provide an all-round, more balanced evaluation of the impact of an HR system or service. Let’s take a closer look in the following sections at analysing client feedback, which may include various levels of feedback, and business impact (or return on investment). Learning activity: Establish systems for evaluation Consider planning for implementation of HR service delivery or service level agreements undertaken in the previous section. Plan a schedule for undertaking performance monitoring and evaluation for the next 6 months. Include tools and strategies for gathering data. Include performance measuring activities and performance measures to gather information useful for all levels of either the Kirkpatrick or Phillips evaluation frameworks. Client feedback To effectively evaluate human resources service delivery, feedback must be obtained from clients. This involves having a process for capturing both: Ongoing feedback Requested feedback Ongoing feedback Ongoing feedback is feedback that is received as part of normal business interactions. It typically occurs as a result of a particular negative or positive experience that for some reason has prompted the person to provide feedback. While this feedback is not part of a formal feedback program, it is very important as it is often very specific and useful in identifying specific problems. BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd 1st edition version: 1 Page 79 of 120 Section 3 – Evaluate Human Resources Service Delivery Student Workbook Case study: Deloitte Consulting HR transformation survey Use the link below to access the Deloitte Consulting report. ● ‘From the ground up, Building an HR infrastructure to support growth’, Deloitte, viewed January 2014, <http://www.deloitterecrute.fr/sites/www.deloitterecrute. fr/files/etude/343/fromthegroundup_hrinfrastructure_2009.pdf>. Read the article ‘HR transformation survey’ on pages 8–13. The article discusses a survey, completed by Deloitte Consulting, of more than 150 global companies to understand those organisations’ views on human resources service delivery in the 21st century. It is a good example of how useful surveys can be in providing information regarding the provision of human resources services. The survey has produced interesting information regarding the different service delivery models and the values those models provide across different industries. Processes for capturing ongoing feedback include: ● providing a specific contact person for clients to contact to provide feedback ● developing and implementing a database for recording feedback to ensure that the feedback can be incorporated in formal reviews completed at a later date ● providing feedback forms to participants to assist with capturing feedback when they want to provide it rather than having them wait and remember their feedback when asked to provide it as part of formal feedback programs conducted some time later. Learning activity: Ongoing feedback Think of a time you have provided casual feedback for services provided to you. What prompted you to provide the feedback? 1st edition version: 1 Page 80 of 120 BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd Student Workbook Section 3 – Evaluate Human Resources Service Delivery Was there a process in place for you to provide that feedback? If yes, what was the process and how did it assist you to provide your feedback? Did you feel your feedback was captured and taken seriously? Why or why not? What could the company, individual or department that you were providing to, done better to improve your experience as a client providing feedback? BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd 1st edition version: 1 Page 81 of 120 Section 3 – Evaluate Human Resources Service Delivery Student Workbook Requested feedback Outside of ongoing feedback, the other way to obtain feedback is to seek it out through requested feedback. This involves surveying clients to determine their level of satisfaction with the services provided. Requested feedback is typically requested at specific times, for example, monthly, quarterly, biannually or annually as part of a formal review program. It is important to remember that, when requested feedback is part of a formal review program, those providing the feedback usually want to see an outcome or next step. They want to know the results of the feedback received and what action is going to be taken with regards to that feedback. Failing to address this requirement can result in participants not providing feedback when it is requested in the future as they see no value in participating. The two popular methods used for surveying clients are focus groups and written feedback forms. Focus groups Focus groups involve meeting with small groups of clients to listen to their feedback regarding the services provided. It is a good idea to prepare some questions to prompt the discussion to ensure the value of the session for all participating. Focus groups also usually discuss solutions to issues or ways in which services could be improved. Written feedback forms Written feedback forms or surveys are generally distributed to a sample group or all members of a client group to assess their satisfaction with the services provided. They typically include a series of questions that asks clients to rate their satisfaction. These ratings are then tallied together to ascertain an overall client satisfaction rating. Some feedback forms also provide clients with an opportunity to provide general comments. This allows clients to make comments about areas they feel strongly about or areas that they feel have not been adequately covered in the questions provided. Tip: Feedback forms It’s easy to create and distribute hard copy surveys to your learners, but there are also very simple ways to create online forms that can be embedded in emails to clients and then the data can be automatically arranged in a spreadsheet so that you don’t have to type out the data yourself. The video ‘Using forms in Google Docs’ explains how to use Google’s form feature <http://youtu.be/IzgaUOW6GIs>. See below for an example of a feedback form for human resources services. 1st edition version: 1 Page 82 of 120 BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd Student Workbook Section 3 – Evaluate Human Resources Service Delivery Strongly Agree Agree Neutral Disagree Please rate the effectiveness of the human resources team member in providing human resources to your business. Strongly Disagree Human resources services feedback form 1. Establishes and maintains positive working relationships with the business. 2. Communicates effectively with managers and employees. 3. Delivers on commitments on time. 4. Responds appropriately to business needs. 5. Provides practical and useful guidance and support. 6. Is prepared to take risks in the interest of the business. 7. Demonstrates strong analytical skills in diagnosing issues. 8. Effectively supports the business throughout the implementation of organisational change. 9. Takes into account both strategic and operational plans when providing advice. 10. Ensures the alignment of people initiatives with business priorities. 11. Possesses strong technical human resources skills. 12. Acts as a strong role model by upholding and promoting business values. What strengths does the HR team member bring to your business? BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd 1st edition version: 1 Page 83 of 120 Section 3 – Evaluate Human Resources Service Delivery Student Workbook What are the development areas for the HR team member? General comments/feedback Learning activity: Written feedback forms Assume you have already implemented planned HR service delivery options at either Australian Hardware or CoffeeVille. Develop a written feedback form to gather information from staff members that will be engaging with HR services. Human resources services feedback form 1st edition version: 1 Page 84 of 120 Strongly Agree Agree Neutral Disagree Strongly disagree Question BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd Student Workbook Section 3 – Evaluate Human Resources Service Delivery (Detail any specific questions here) Analyse client feedback Once feedback has been obtained it must be analysed: ● Look for trends and recurring themes; is the same area rating poorly by all those surveyed or is one part of the business only rating a particular area poorly? ● Complete further investigations into those areas that show a trend or recurring theme that could be improved. Example: JMH Insurance Strongly Disagree Disagree Neutral Agree Strongly Agree Total The human resources manager at JMH Insurance used the human resources services feedback form on the previous page to obtain feedback from 15 managers regarding the effectiveness of the human resources team. The human resources manager then compiled the feedback using the following table. Establishes and maintains positive working relationships with the business. 2 3 1 4 5 15 2 Communicates effectively with managers and employees. 2 2 0 6 5 15 3 Delivers on commitments on time. 4 5 0 3 3 15 4 Responds appropriately to business needs. 4 4 1 3 3 15 5 Provides practical and useful guidance and support. 2 2 2 5 4 15 6 Is prepared to take risks in the interests of the business. 5 5 2 3 0 15 Question 1 BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd 1st edition version: 1 Page 85 of 120 Disagree Neutral Agree Strongly Agree Total Student Workbook Strongly Disagree Section 3 – Evaluate Human Resources Service Delivery 7 Demonstrates strong analytical skills in diagnosing issues. 1 2 2 5 5 15 8 Effectively supports the business throughout the implementation of organisational change. 2 2 1 5 5 15 Takes into account both strategic and operational plans when providing advice. 4 4 2 3 2 15 10 Ensures the alignment of people initiatives with business priorities. 5 5 1 2 2 15 11 Possesses strong technical human resource skills. 1 2 1 6 5 15 12 Acts as a strong role model by upholding and promoting business values. 0 1 2 6 6 15 Question 9 The human resources manager then analysed the data using the following methodology. ● ‘strongly disagree’ and ‘disagree’ summarised as ‘unfavourable’ ● ‘neutral’ ratings summarised as ‘neutral’ ● ‘strongly agree’ and ‘agree’ summarised as ‘favourable’. This methodology allows the human resources manager to see what areas of services are viewed by managers as working well (favourable rating) and what areas need to be improved (unfavourable rating). The human resources manager also views those areas rated ‘neutral’ as areas that can be improved. The human resources manager applied the methodology using the following table. Unfavourable % Neutral % Favourable % Establishes and maintains positive working relationships with the business. 33% 7% 60% 2 Communicates effectively with managers and employees. 27% 0% 73% 3 Delivers on commitments on time. 60% 0% 40% 4 Responds appropriately to business needs. 53% 7% 40% Question 1 1st edition version: 1 Page 86 of 120 BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd Student Workbook Section 3 – Evaluate Human Resources Service Delivery Question Unfavourable % Neutral % Favourable % 5 Provides practical and useful guidance and support. 27% 13% 60% 6 Is prepared to take risks in the interests of the business. 67% 13% 20% 7 Demonstrates strong analytical skills in diagnosing issues. 20% 13% 67% 8 Effectively supports the business throughout the implementation of organisational change. 27% 7% 67% Takes into account both strategic and operational plans when providing advice. 53% 13% 33% 10 Ensures the alignment of people initiatives with business priorities. 67% 7% 27% 11 Possesses strong technical human resource skills. 20% 7% 73% 12 Acts as a strong role model by upholding and promoting business values. 7% 13% 80% 9 The human resources manager has identified that all questions with an ‘unfavourable’ rating of 50% or more require improvement. As result the following areas will be further reviewed to identify what improvements can be made to ensure a more effective service. Question Unfavourable % Neutral % Favourable % 3 Delivers on commitments on time. 60% 0% 40% 4 Responds appropriately to business needs. 53% 7% 40% 6 Is prepared to take risks in the interests of the business. 67% 13% 20% 9 Takes into account both strategic and operational plans when providing advice. 53% 13% 33% Ensures the alignment of people initiatives with business priorities. 67% 7% 27% 10 BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd 1st edition version: 1 Page 87 of 120 Section 3 – Evaluate Human Resources Service Delivery Student Workbook Learning activity: Analyse client feedback Recall the Kirkpatrick and Philips models discussed in the opening to this section. In the JMH insurance example above, what level/s of evaluation is the information useful for? Is the information provided on the feedback form useful for all levels of evaluation? Do you think other levels of evaluation are important? Why? Why not? How is this information useful for the evaluation of HR service delivery? What themes or trends can you identify? 1st edition version: 1 Page 88 of 120 BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd Student Workbook Section 3 – Evaluate Human Resources Service Delivery What further investigations would you undertake to get a full picture of the performance of HR service providers? What tools, methods or performance measures would you use to gather information for business impact or ROI? Evaluate business impact When you evaluate human resources performance, it is important to measure and analyse the business impact of HR service delivery options. Many organisations take a balanced scorecard approach to determining the success of the organisation. Such an approach means that the needs of customers and employees as well as investor stakeholder groups are considered. Consider the following example: Example: Australian Hardware balanced scorecard KRA Objective or target Increase gross profit by 5% Financial Customer value Increase productivity by 10% Increase market share by 10% Performance metric or KPI Result $ 2% increase $ Profit per employee 2% increase $ Revenue per employee 3% increase Customer satisfaction rating 78% satisfaction Customer return visits 90% transaction from return customers BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd 1st edition version: 1 Page 89 of 120 Section 3 – Evaluate Human Resources Service Delivery Student Workbook Example: Australian Hardware balanced scorecard KRA Objective or target People development Process Performance metric or KPI Result 100 staff inducted or up-skilled for roles Training rate 90% staff inducted within one week Australian Hardware is an employer of choice Satisfaction rating 80% satisfied with employment Staff background reflects modern Australia % minority employment 20% self-identify as minority or Aboriginal/ Torres Strait Islander Provide leadership to support superior performance % PD plans completed by managers 86% completed on time Maintain a fair workplace at all levels for everyone % minorities in senior roles 5% self-identify as minority or Aboriginal/ Torres Strait Islander According to David Ulrich in Measuring Human Resources, there are three main areas related to the balanced scorecard relevant for the monitoring and evaluation of HR service delivery: productivity, people and process. These areas are related to a number of important metrics for directly or indirectly measuring the business impact. Productivity People Process What is the ratio of output to input (return on investment)? What attitude, behaviour and knowledge or skills does the workforce display? How (well, efficiently, fairly) does the job get done? ● Revenue per employee. ● Cost per employee. ● Units produced per employee. ● Profit per employee. ● Competence (the ability to do a task to the standard required). ● Workflow efficiency. ● Leadership ratings. ● Innovation ratings. ● Speed/cycle/time/ ● Satisfaction ratings. speed to market. ● Turnover or retention ● Training processes. of personnel. ● Grievance or numbers of complaints. ● Absenteeism numbers. ● Cultural cohesion/ unity/shared understanding of how things are done here. ● Equity and diversity.8 8 Ulrich, D., 1997, ‘Measuring Human resources: An Overview of Practice and a Prescription for Results’, Human Resources Management, Vol. 36, No 3, pp. 303–320, available online viewed January 2014, <http://www.e-rh.org/documents/ISO/measuring-hr-kpi-for-hr.pdf>. 1st edition version: 1 Page 90 of 120 BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd Student Workbook Section 3 – Evaluate Human Resources Service Delivery Note that, in accordance with the balanced scorecard methodology, not all of the measures are directly related to financial impact. In order to measure the business impact of HR services and explain the importance of HR service delivery to the success of the organisation, you will need to focus on tools and information gathering that allows you to gather useful data on productivity, people impact and process impact directly attributable to HR programs and activities. Learning activity: Evaluate business impact Review your work for the previous activity: ‘Establish systems for evaluation’ (page 79). Ensure that your monitoring and evaluation system includes tools and measurements of productivity, people, and process directly attributable to HR programs and initiatives. Recommend variations As a result of collecting and evaluating performance data on HR performance, it may become apparent that changes need to be made to the way in which services are provided. In order to make recommendations, you will need to analyse variation between agreed service levels and actual performance to determine root causes of underperformance. You will need to provide appropriate support for your recommendations to vary service delivery, present recommendations in accordance with business reporting processes, and ensure you support the process of change through appropriate planning and activities. Identifying root causes To ensure your recommendations for variations to service delivery are supported and implemented by others, you must be able to explain root causes of performance problems. A useful method for determining root causes is the 5-Whys technique. Let’s look at an example. Example: 5-Whys? The HR manager at Australian Hardware needed to know why the profit per employee and revenue per employee was falling below target. The following questioning process was undertaken: Q: Why were the results below target? A: Employees didn’t know how to increase their productivity. Q: They were trained in the relevant skills, so why didn’t they know how? A: They were not performance managed to ensure they could apply their skills and set meaningful targets. Q: Why were they not performance managed? A: Line managers did not receive enough support and training from HR in a timely manner. BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd 1st edition version: 1 Page 91 of 120 Section 3 – Evaluate Human Resources Service Delivery Student Workbook Q: Why did they not receive support from HR? A: The HR service level agreement did not contain appropriate metrics and accountabilities for providing services on time. Q: Why were appropriate metrics and accountabilities not set? A: HR service providers are unclear about the needs of the business. Clearly, there were a number of reasons for the poor performance; the root cause, however, as discovered through investigations and questioning, was that the HR personnel negotiating service level agreements did not understand the needs of the line managers for timely support in performance management. The HR manager decided to recommend that HR service providers partner with the line managers responsible for managing customer facing staff to determine needs and renegotiate service level agreements. To ensure understanding and buy in from all stakeholders, new agreements, which should include metrics and timelines for performance management, would be strategically promoted. To show organisational commitment to the changes, senior management would participate and lend their support to the communication activities which would include a senior and line management conference call. Making and supporting recommendations for change Depending on the specific circumstances there are a number of possible recommendations you can make. Examples of general recommendations you may make include: ● modify service delivery model ● modify service level agreements ● extend action plan timelines ● increase the budget or resources for providing services ● provide coaching to teams and individuals to ensure interaction between line managers, human resources team members and service providers is effective. To support your recommendations, you will need to explain how any variations to services that you recommend will specifically address performance issues. Once you have established and explained the root cause or causes of underperformance, you will need to explain how proposed changes will close any performance gaps. When presenting recommendations to management teams or colleagues you need to ensure that you clearly outline: ● what the performance issue is ● how you identified the issue (e.g. feedback from managers) ● what variation you are recommending and why; consider: ○ what has worked in the past to address similar issues ○ what is working now in other departments or organisations to address similar issues 1st edition version: 1 Page 92 of 120 BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd Student Workbook Section 3 – Evaluate Human Resources Service Delivery ○ what case studies are available to illustrate the effectiveness of your proposed measures to address similar performance issues ● how variations to service delivery will specifically addresses the issue. You should also ensure that your recommendation is supported by documentation to help demonstrate the issue or recommendation, which could include: ● a brief document summarising the issue and recommendation (PowerPoint or Word is appropriate) ● action plan status reports ● timelines ● financial reports, e.g. budget vs. actual reports. Organisational reporting and approval processes Recommendations must be prepared to be submitted for approval in accord with organisational processes. Organisational processes may include meeting formats or management report formats. Ensure you follow all organisational processes for the preparation of written evaluation reports, storage of data and approval for implementing recommendations. Learning activity: Recommend variations to HR services Consider the following scorecard for JMH insurance and the manager feedback information presented earlier in the section (page 85). Write a 3–4 page evaluation report addressed to senior management. Include in your report: ● An executive summary ● Presentation of relevant data ● Recommendations and support for recommendations ● An action plan for implementing recommendations and supporting changes. KRA Objective or target Financial performance and productivity Increase productivity by 10% People development All staff inducted or up-skilled for roles Performance metric or KPI Result $Profit per employee 2% decrease $Revenue per employee 5% decrease 95% staff inducted within one week Training rate BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd 100% required upskill completed 1st edition version: 1 Page 93 of 120 Section 3 – Evaluate Human Resources Service Delivery KRA People development (continued) Process Student Workbook Objective or target Performance metric or KPI Recruitment reflects needs of business Performance ratings of new staff Average rating 3/5 Australian Hardware is an employer of choice Satisfaction rating 65% satisfied with employment Provide leadership to support superior performance % professional development (PD) plans completed by managers 70% completed on time Number of antidiscrimination complaints 10 complaints per 100 employees Maintain a fair workplace at all levels for everyone: >1 complaint per 100 employees Result Section summary You should now understand how to effectively use a variety of tools and methods to evaluate human resources service delivery. Further reading ● Kramar, R., et al., 2013, Human Resource Management in Australia, 5th edn, McGraw-Hill Australia, Ch. 18. ● Yeung, A. and Berman, B., 1997, ‘Adding value through human resources: Reorienting human resource measurement to drive business performance’, Human Resources Management, Vol. 36, No 3, pp. 321–335, available online, viewed January 2014, <http://deepblue.lib.umich.edu/bitstream/handle/2027.42/ 34580/4_ftp.pdf>. ● Ulrich, D, 1997, ‘Measuring human resources: An overview of practice and a prescription for results’, Human Resources Management, Vol. 36, No 3, pp. 303– 320, available online, viewed January 2014, <http://www.e-rh.org/documents/ ISO/measuring-hr-kpi-for-hr.pdf>. ● Ulrich, D., Younger, J., Brockbank, W., Ulrich, M., 2012, HR from the outside in: Six competencies for the future of human resources, McGraw-Hill, USA. Ch. 10, Appendix A: Ideas for how HR professionals can develop their competence and Appendix B: HRCS Competency Self-assessment. 1st edition version: 1 Page 94 of 120 BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd Student Workbook Section 3 – Evaluate Human Resources Service Delivery Section checklist Before you proceed to the next section, make sure that you are able to:  establish systems for gathering and storing information needed to provide human resources services  survey clients to determine level of satisfaction  capture ongoing client feedback for the review processes  analyse feedback and surveys and recommend changes to service delivery  obtain approvals to variations in service delivery from appropriate managers  support agreed change processes across the organisation. BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd 1st edition version: 1 Page 95 of 120 Section 4 – Integrate Business Ethics in Human Resources Practices Student Workbook Section 4 – Integrate Business Ethics in Human Resources Practices This section is about managing the integration of business ethics in human resources practices. Scenario: Supporting an ethical business culture at Australian Hardware According to the Australian Hardware code of conduct, employees and officers of Australian Hardware are expected to: ● respect and support the six core values of the organisation: ○ quality ○ performance excellence ○ value for investors, customers and employees ○ personal and professional development ○ diversity ○ sustainability ● respect others and treat others fairly ● act in accordance with relevant legislation, standards and industry codes of practice ● act honestly to protect the reputation of Australian Hardware ● avoid conflict of interest ● protect the privacy of others. The organisation’s code of conduct has been designed to support the integration of business ethics with elements of business planning, namely the business mission, vision and strategic goals. Connie needs to ensure business ethics are integrated into the way HR delivers services. She will need to ensure communication and training are adequate; she will also need to ensure delivery strategies embody and promote the values of the organisation. Above all she will need to ensure HR personnel exemplify ethical business partnering and leadership. 1st edition version: 1 Page 96 of 120 BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd Student Workbook Section 4 – Integrate Business Ethics in Human Resources Practices What skills will you need? In order to work effectively as a human resources professional, you must be able to:  ensure that personal behaviour is consistently ethical and reflects values of the organisation  ensure that the code of conduct is observed across the organisation and that its expectations are incorporated in human resources policies and practices  observe confidentiality requirements in dealing with all human resources information  deal with unethical behaviour promptly  ensure that all persons responsible for the human resources functions are clear about ethical expectations of their behaviour. What are business ethics? Business ethics can be defined as ‘the study of what constitutes right and wrong, or good and bad, human conduct in business context’9. Business ethics provide employees with the rules of how they should behave. Organisations use documents such as codes of ethics and codes of conduct to communicate to employees the expected behaviours. Ethics and law People often confuse ethics and law – but they are different things. Breaking the law is not always immoral and, equally, just because an action is legal does not mean that it is morally right. For example: ● An action can be illegal but morally right. In 2007 Ms Janet Hinshaw-Thomas was arrested by Canadian authorities for accompanying Haitians seeking asylum in Canada. She was charged with human trafficking. Her lawyer said: ‘She is not running some kind of covert murky operation at all, she was doing this on a purely humanitarian basis to assist refugees who are seeking asylum in a country where they have a right to present their claims.’ Ms Hinshaw-Thomas had advised the Canadian Border authorities five days prior to her trip and had provided information as to the when she would arrive and how 9 Barry, V. and Shaw, W., 2001, Moral issues in business, Wadsworth, California, p. 4. BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd 1st edition version: 1 Page 97 of 120 Section 4 – Integrate Business Ethics in Human Resources Practices Student Workbook many refugees she had with her. Yet, she broke the law and could have spent the rest of her life in prison for her actions.10 ● An action can be legal but morally wrong. For example, executives can retrench a large number of employees and use the cost savings from those retrenchments to pay themselves a higher salary or bonus. Whilst this is unethical and morally wrong it is not illegal. There are a number of pieces of legislation that apply to organisations and employees that human resources professionals must ensure are complied with when providing human resources services and support. As discussed in Section 1, these include: ● Fair Work Act 2009 ● work/occupational health and safety (OHS/WHS) legislation ● equal opportunity legislation ● anti-discrimination legislation. Organisations aim to address legal and ethical obligations by developing and promoting the use of codes of ethics, codes of conducts, policies and procedures to ensure employees understand and have the practical tools to implement ethical practices. Human resources professionals are responsible for ensuring that both business ethics and legal compliance are incorporated into all human resources policies and practices. Business ethics is often incorporated into organisational strategic planning. For example, organisational vision statements and values statements articulate ethical principles that all employees are expected to adhere to. HR professionals are expected to implement company values into service delivery strategies and exemplify ethical attributes such as fairness and openness. Learning activity: Business ethics Consider your organisation or an organisation you wish to research. What legal and ethical issues are relevant to your work or operations? Tchividjian, E., October 2007, ‘Archive: ethical and illegal’, Ruder Finn, viewed January 2014, <http://www.ruderfinn.com/blogs/ethics/2007/10>. 10 1st edition version: 1 Page 98 of 120 BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd Student Workbook Section 4 – Integrate Business Ethics in Human Resources Practices How are legal and ethical issues managed by the organisation? Codes of ethics and codes of conduct Organisations use two documents to communicate expectations regarding business ethics: Codes of ethics Codes of conduct Case study: The University of Western Australia – Code of ethics Use the link below to access the University of Western Australia Code of Ethics. ● ‘Code of ethics’, University of Western Australia, viewed January 2014, <http://www.hr.uwa.edu.au/publications/code_of_ethics>. This is a good example of how codes of ethics apply in the workplace. Codes of ethics A code of ethics provides a set of guiding principles for the way in which employees should behave. In comparison to a code of conduct, a code of ethics will tend to: ● have a broader focus and provide general information with regards to expected behaviour ● provide guidance as to how employees ‘should’ behave rather than what they must do ● set the foundation for an organisation’s code of conduct. A code of ethics usually includes provisions such as: ● that all employees should be treated with respect and dignity ● the workplace is a safe and challenging environment where people can grow professionally and personally. BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd 1st edition version: 1 Page 99 of 120 Section 4 – Integrate Business Ethics in Human Resources Practices Student Workbook Learning activity: Code of ethics Obtain a copy of an organisation’s code of ethics and review the contents to answer the questions below. What principles does the code of ethics provide for employee behaviour? What sort of workplace do you think these principles provide for? Tip: If you are currently employed you can use your organisation’s code of ethics, however, if you are not employed you can obtain an example by searching the internet for “code of ethics’. Codes of conduct A code of conduct is a continuation of organisation’s code of ethics but it provides more specific detail with regards to what behaviour is expected by the organisation. Codes of conduct sometimes also include the consequences for employees for failing to meet those expectations. Below is an example of a code of conduct for the Australian Public Service Commission (APS). You will note that it provides very specific details of how it expects employees to behave. 1st edition version: 1 Page 100 of 120 BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd Student Workbook Section 4 – Integrate Business Ethics in Human Resources Practices Australian Public Service (APS) Code of Conduct APS employees are required, under the Code of Conduct, to behave at all times in a way which upholds the APS values. The Code The Code of Conduct requires that an employee must: ● behave honestly and with integrity in the course of APS employment ● act with care and diligence in the course of APS employment ● ● when acting in connection with APS employment, treat everyone with respect and courtesy, and without harassment ● when acting in connection with APS employment, comply with all applicable Australian laws ● comply with any lawful and reasonable direction given by someone in the employee's Agency who has authority to give the direction ● maintain appropriate confidentiality about dealings that the employee has with any Minister or Minister’s member of staff ● disclose, and take reasonable steps to avoid, any conflict of interest (real or apparent) in connection with APS employment ● use Commonwealth resources in a proper manner ● not provide false or misleading information in response to a request for information that is made for official purposes in connection with the employee’s APS employment ● not make improper use of: ○ inside information, or ○ the employee’s duties, status, power or authority in order to gain, or seek to gain, a benefit or advantage for the employee or for any other person; ● at all times behave in a way that upholds the APS Values and Employment Principles, and the integrity and good reputation of the employee’s Agency and the APS ● while on duty overseas, at all times behave in a way that upholds the good reputation of Australia ● comply with any other conduct requirement that is prescribed by the regulations (regulations available here). Source: ‘APS code of conduct’, Australian Public Service Commission, viewed January 2014, <http://www.apsc.gov.au/aps-employment-policy-and-advice/aps-values-andcode-of-conduct/code-of-conduct>. BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd 1st edition version: 1 Page 101 of 120 Section 4 – Integrate Business Ethics in Human Resources Practices Student Workbook Ensure the code of conduct is observed across the organisation You will need to ensure that codes of ethics and codes of conduct are observed across the organisation. As an HR professional, some of the ways you can do this include ensuring HR policies and procedures – such as recruitment policies or performance management policies – are consistent with codes of conduct. You will also need to develop communication action plans to ensure that codes of conduct are understood and able to be applied. You may need to undertake a training needs analysis to determine teams or individual competencies with regard to the application or knowledge of ethical practices and arrange required training. You will need to show leadership by embodying the attributes and values described by the code. You will need to: ● be honest with internal and external clients: develop a reputation for truthfulness ● ensure consistency and fairness in your personal behaviour ● eliminate the fact or appearance of conflict of interest ● monitor ethics and be seen to take ethical behaviour seriously. Above all, you will need to act to redress breaches of the code, by acting immediately to correct behaviour or bring the behaviour to the attention of designated persons. Learning activity: Code of conduct Obtain a copy of an organisation’s code of conduct and review the contents to answer the questions below. What specific behaviours does the code of conduct cover? Does it make it clear to employees what is expected? 1st edition version: 1 Page 102 of 120 BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd Student Workbook Section 4 – Integrate Business Ethics in Human Resources Practices Does it include information regarding the consequences for failing to meet the detailed expectations? If yes, what are the consequences? Tip: If you are currently employed, you can use your organisation’s code of conduct, however, if you are not employed you can obtain a copy by searching the internet for ‘code of conduct’. Human resources policies and practices As noted above, when you are developing human resources policies and practices it is important to incorporate the behaviour expectations detailed under the code of conduct into work practices. For an organisation’s code of conduct to be effective in governing the way in which employees behave towards internal personnel and external clients, the expectations it sets out must be included in all policies and practices across the organisation. This allows the code of conduct to ‘come to life’ and have an impact across the organisation. For example, a human resources manager developing a recruitment policy for the APS would need to incorporate the standards detailed in the APS code of conduct (see above). As a result, their recruitment policy would need to include elements such as: ● all applicants to be treated with respect and courtesy and without harassment ● all applications will be treated as confidential and care and diligence will be undertaken for all applications received ● it is expected that all applicants provide honest information and in return honest feedback will be provided ● all applications will be regarded on merit and in accordance with anti-discrimination and equal opportunity legislation ● applicants and hiring managers must disclose, and take reasonable steps to avoid, any conflict of interest (real or apparent) in connection with recruitment activities ● applicants must not provide false or misleading information in response to a request for information regarding their application ● hiring managers must not make improper use of: ○ inside information, or ○ the employee's duties, status, power or authority, in order to gain, or seek to gain, a benefit or advantage for any applicant ● hiring managers must at all times behave in a way that upholds the APS values and the integrity and good reputation of the APS. BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd 1st edition version: 1 Page 103 of 120 Section 4 – Integrate Business Ethics in Human Resources Practices Student Workbook As you will note in this example, by using the APS code of conduct as the foundation of these elements, the recruitment policy then ensures that it provides hiring managers and employees with specific information as to how they are expected to behave during the recruitment process. This is an example of how human resources professionals can integrate the code of conduct into human resources policies and practices. Learning activity: Human resources policies and practices Using the code of conduct you sourced in the previous activity ‘Code of conduct’, detail the elements that would need to be included to integrate the organisation’s code of conduct within a performance management policy. (Use the APS recruitment policy elements example above to assist you with completing this activity.) Locate the Australian Hardware recruitment or performance management policies and procedures on the IBSA simulated business website. How have organisational values, ethical considerations and legal concerns been integrated and written into these policies and procedures? Note: Simulated business information, including business and operational plans, financial information, and policies and procedures (including performance management) can be located online at <http://simulations.ibsa.org.au/>. Human resources team member behaviour Human resources professionals must ensure that their personal behaviour is consistently ethical and reflects the values of the organisation. They must ensure that they are personally aware of the organisation’s code of ethics, code of conduct and values and abide by these at all times. Managers and employees often look to human resources team members as role models of expected behaviours, and for this reason it’s critical that human resources team member’s actions are in accordance with good business ethics and organisational values. Human resources managers must ensure that their team members are clear about the ethical expectations of their behaviour to ensure that the right behaviours are being role modelled by the team. Human resources managers can ensure team members are clear about the ethical expectation of their behaviour through: ● education regarding the organisation’s code of ethics, code of conduct and organisational values ● training regarding the practical application of the code of ethics and code of conduct in the workplace using scenarios ● debrief of recent business situations involving ethics and values during team meetings to assist with learning what is expected. 1st edition version: 1 Page 104 of 120 BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd Student Workbook Section 4 – Integrate Business Ethics in Human Resources Practices Learning activity: Human resources team member behaviour Answer the questions below. How do you ensure that your behaviour is consistently ethical and reflects the values of the organisation? What strategies could you implement to ensure that your team behaves in a way that is consistently ethical and reflects the values of the organisation? BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd 1st edition version: 1 Page 105 of 120 Section 4 – Integrate Business Ethics in Human Resources Practices Student Workbook Observe confidentiality requirements One of the most important ethical expectations of human resources professionals is maintaining confidentiality. Human resources professionals are exposed to large amounts of confidential information regarding employees such as: ● salaries and wages ● performance ● job applications ● promotions ● terminations (retrenchment and resignations). Managers and employees expect that confidentiality of this information is maintained by human resources departments. A break in this trust can have severe impacts on the human resources team’s ability to effectively support the business. The human resources professional’s business ethics are often put to the test regarding confidentiality of information; however, it is important to recognise that confidentiality must always be maintained except in very special circumstances, such as if there is a threat to a person’s life or if it is required to be disclosed by law. Example: Retrenchment at Australian Hardware Connie is currently working with the operations manager to identify a number of employees who will be retrenched as a result of a downturn in sales. Connie is good friends with one of the store managers, Patricia. Connie knows that Patricia is very concerned that she may be made redundant, as her husband was made redundant last month and has still not been able to find another job. Patricia approaches Connie and asks her if she is going to be retrenched as she needs as much notice as possible to ensure she has plenty of time to find another job as her husband is still not working. Connie tells Patricia that she cannot tell her if she is going to be retrenched as this would be a breach of the organisation’s code of conduct, and the operations manager’s trust. Patricia starts to cry and begs Connie to tell her. Connie explains to Patricia again that she cannot tell her. Patricia gets very annoyed and storms off crying. Connie feels terrible but knows she has done the right thing. At this stage, the business is not in any position to announce any retrenchment as no final decisions have been made, and if she had told Patricia then, in fairness, all employees should be told. 1st edition version: 1 Page 106 of 120 BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd Student Workbook Section 4 – Integrate Business Ethics in Human Resources Practices Learning activity: Maintaining confidentiality You are the HR manager at Savings Financial Solutions and have just assisted the finance director to recruit a new accountant to join the accounting team. This team have been disgruntled for some time regarding their salaries and have been asking the finance director for a pay rise which has been refused. You are good friends with Simon, one of the accountants. On the weekend you are having dinner with Simon and he explains that he is upset because he has heard the new accountant is being paid $10,000 more than he is. He says he is thinking he will leave as this is unfair. You know this is not true and in actual fact the new accountant is being paid less than Simon. How would you respond to Simon? Deal with unethical behaviour It is essential that all unethical behaviour is dealt with promptly. Failing to address issues quickly can send a message to employees that the organisation accepts or condones the behaviour and therefore it is acceptable. Addressing unethical behaviour promptly sends a strong message to employees that the behaviour will not be tolerated. Addressing unethical behaviour All breaches of an organisation’s code of conduct must be investigated and dealt with. The typical process for addressing unethical behaviour is as follows. 1. Receive the complaint or information regarding the breach. 2. Advise the employee of the issue. 3. Investigate the breach – speak to any witnesses. 4. Present the outcomes of your investigation to the employee and provide them with time to consider the allegations and respond. 5. Determine the seriousness of the breach by considering: a. the employee’s response to the allegations b. if their actions were provoked in any way c. any potentially mitigating circumstances. BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd 1st edition version: 1 Page 107 of 120 Section 4 – Integrate Business Ethics in Human Resources Practices Student Workbook 6. Determine and implement the appropriate course of action, such as: a. termination (instant dismissal is appropriate for some serious breaches of the code of conduct, e.g. assaulting another employee) b. first written warning c. first and final written warning. Human resources professionals must ensure that they have considered the organisation’s policies and procedures for dealing with breaches of the code of conduct before taking any action. It is also critical that human resources professionals consider the legislative requirements applicable to dealing with breach of the code of conduct for their organisation. Learning activity: Cases involving unethical behaviour Use the following links to access cases where employees have been dismissed for breaching their organisation’s code of conduct or for unethical behaviour. Review each of the cases and answer the following questions. Case 1 ● ‘Timothy Presbury vs. Australian Rail Track Corporation Limited (U2009/12786)’ Fair Work Australia, viewed January 2014, <http://www.fwa.gov.au/decisionssigned/html/2010fwa2282.htm>. How did the employee breach the code of conduct or behave unethically? What was the basis of the employee’s termination? 1st edition version: 1 Page 108 of 120 BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd Student Workbook Section 4 – Integrate Business Ethics in Human Resources Practices Did the commission support termination? Why or why not? What does this case teach you about dealing with breaches of the code of conduct or unethical behaviour in the workplace? Case 2 ● ‘Ms Jennifer Delaney vs. Parramatta Leagues Club Limited (U2009/11060)’ Fair Work Australia, viewed January 2014, <http://www.fwa.gov.au/decisionssigned/html/2010fwa1164.htm>. How did the employee breach the code of conduct or behave unethically? What was the basis of the employee’s termination? BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd 1st edition version: 1 Page 109 of 120 Section 4 – Integrate Business Ethics in Human Resources Practices Student Workbook Did the commission uphold the termination? Why or why not? What does this case teach you about dealing with breaches of the code of conduct or unethical behaviour in the workplace? Case 3 ● ‘Martine Magers vs. Department of Health and Ageing (U2008/8103)’, Fair Work Australia, viewed January 2014, <http://www.fwa.gov.au/decisionssigned/html/2010fwa831.htm>. How did the employee breach the code of conduct or behave unethically? What was the basis of the employee’s termination? 1st edition version: 1 Page 110 of 120 BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd Student Workbook Section 4 – Integrate Business Ethics in Human Resources Practices Did the commission uphold the termination? Why or why not? What does this case teach you about dealing with breaches of the code of conduct or unethical behaviour in the workplace? Learning activity: Dealing with unethical behaviour You are the human resources manager at Black and White Printing. You have just received information from a manager that one of your human resources team members has disclosed the details of an employee in the printing team’s performance management program to other employees in the printing team. Detail the steps you would take to deal with alleged breach. BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd 1st edition version: 1 Page 111 of 120 Section 4 – Integrate Business Ethics in Human Resources Practices Student Workbook As a result of your investigation you have established that your team member did in fact disclose this confidential information. The employee’s response to the allegation was that it was stupid mistake. He was out with the printing team on Friday night at the pub and one of the team asked him what was happening regarding this particular employee, to which he responded that the employee is on performance management program and is now on his second warning. What action would you take and why? Section summary You should now understand how to manage the integration of business ethics in human resources practices. Further reading ● Australian Public Service Commission, ‘APS code of conduct’, viewed January 2014, <http://www.apsc.gov.au/aps-employment-policy-and-advice/aps-values-and-codeof-conduct/code-of-conduct>. ● Barry, V. and Shaw, W., 2001, Moral issues in business, Wadsworth, California. ● Kramar, R., et al., 2013, Human Resource Management in Australia, 5th edn, McGraw-Hill Australia, Ch. 15. ● St James Ethics Centre, 2012, ‘Codes of ethics’, viewed January 2014 <http://www.ethics.org.au/about/what-is-ethics>. 1st edition version: 1 Page 112 of 120 BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd Student Workbook Section 4 – Integrate Business Ethics in Human Resources Practices Section checklist Before you proceed to the next section, make sure that you are able to:  ensure that personal behaviour is consistently ethical and reflects values of the organisation  ensure that code of conduct is observed across the organisation and that its expectations are incorporated in human resources policies and practices  observe confidentiality requirements in dealing with all human resources information  deal with unethical behaviour promptly  ensure that all persons responsible for the human resources functions are clear about ethical expectations of their behaviour. BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd 1st edition version: 1 Page 113 of 120 Glossary Student Workbook Glossary Term Definition Appraisal Refers to performance appraisal. See ‘Performance appraisal’. Balanced scorecard A method of measuring or presenting performance information for an organisation. Balanced scorecards measure an organisation’s performance based on a number of different but equally important perspectives , for example: ● the perspective of the shareholder: ○ financial goals ○ return on investment ○ process or management efficiency ● the perspective of the customer (customer focus): ○ customer value ○ environmental responsibility ○ market share ● the perspective of the employee: ○ professional development and training ○ opportunity, fairness. All perspectives are important for the organisation’s sustainability as a profitable, marketable and capable enterprise. Business partnering An approach to providing services in which HR personnel play the role of collaborator with management at various levels of the organisation to support the achievement of business goals through strategic performance management, recruitment, training, etc. A key feature of the business partnering approach is the emphasis on business and customer needs as opposed to internal, bureaucratic HR needs. Capability 1st edition version: 1 Page 114 of 120 Capability may be used as a synonym for competence when applied to individuals; however, it is often used in the context of discussing the potential of a workforce for implementing strategic directions. Unlike competence, capability can apply to organisations as a whole. BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd Student Workbook Glossary Term Definition Centres of excellence (or expertise) An HR unit composed of specialists in recruitment, training, employee relations, for example, who provide services to other business units, usually under some form of the shared services model. Classic HR model David Ulrich and others developed an HR model, often referred to as the ‘classic’ HR model but also known as the ‘three-legged stool’ model or the business partner model. It comprises three elements: ● business partners ● shared services ● centres of excellence (or expertise). Client In the HR context of this workbook, ‘client’ refers to an individual, team or department that is receiving HR services. Competence A quality of individuals who can perform adequately in a job role. More technically, competence is the ability to perform a job role or function to a desired standard. Divisional structure A management or organisational structure in which employees are grouped by division. Divisions may be services, products or ranges of products. A division may extend through the entire lifecycle of a product – from design to production to marketing and sales. Flat structure An organisational structure consisting of few management levels as opposed to a hierarchical structure. Flat structures are typical of small organisations. Functional structure A management or organisational structure in which employees are grouped according to role or task, for example: ● sales team ● production team ● administration team ● accounting team. Hierarchical structure The opposite of flat structure, i.e., having many levels of management. As organisations grow, they tend to become more complex and hierarchical. Horizontal integration See integration. BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd 1st edition version: 1 Page 115 of 120 Glossary Student Workbook Term Definition HR models HR models provide frameworks for structuring the delivery of HR in organisations. A number of HR models exist. Basic HR models include: ● traditional HR model ● classic HR model. HR structures A way of delivering HR services to organisations through the adoption of one systematic organisation of resources or several compatible approaches. Some examples include: ● shared services ● centres of excellence (or expertise) ● centralised HR ● dedicated HR. HR structures may include some implications for organisational structure and accountabilities overall. For example, shared services may involve a matrix structure in which HR officers report to both a central HR and line managers; dedicated HR units are common in holding companies, which generally do not have a central HR. Integration In the HR context, integration usually refers to ensuring that the HR strategy, policies and procedures are appropriately designed to fit with the overall organisational strategy, vision, mission, policies and procedures. Horizontal integration: Ensuring that all policies and processes that exist for a single level of the organisation (such as a single team or department) are developed so that they complement and inform each other. Vertical integration: Ensuring that policies and processes at every level of the organisation (such as at a senior management level and a work team level) are all informed and influenced by the work requirements and individuals at every level. Key performance indicators (KPI) Performance measures that focus on achieving results that are seen as critical to the success of the organisation. Indicators may be ‘lagging’ or leading’: ● lagging: measures that indicate past performance ● leading: measures that predict future performance. 1st edition version: 1 Page 116 of 120 BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd Student Workbook Glossary Term Definition Management structure The way the organisation is structured to facilitate decisionmaking, control, and communication to achieve its goals. Common structures include: ● functional ● divisional ● matrix. Structure may also be described as flat or hierarchical. Matrix structure A management or organisational structure in which employees are answerable to functional as well as cross-functional managers. For example a sales person may report to the sales manager as well as a project manager working on launching a new product range. Matrix structures combine some aspects of divisional and functional structures to gain flexibility, adaptability and flow of communication and expertise. In the context of performance management, the appraisals process and development process may benefit, for example, from the input of at least two managers. A possible drawback of matrix structures is that lines of authority may be blurred and more complex to manage. Performance appraisal A formal review of employee performance. Also known as a performance review. Performance excellence A quality goal to integrate all business activities to create improved results for customers and stakeholders. Performance management A management system to boost employee performance and the productivity of the organisation. Usually a system overseen by HR personnel. Performance management system (PMS) A three-stage management system that includes: setting performance goals, creating performance standards, monitoring performance, rewarding excellence in performance and working towards continual improvements. Self-appraisal Employees provide feedback on their own performance. BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd 1st edition version: 1 Page 117 of 120 Glossary Student Workbook Term Definition Service level agreement (SLA) Service level agreements (SLAs) are written agreements between a party delivering a service (such as providing recruitment support) and a party receiving a service (such as receiving recruitment support). The service provider may be an external organisation, or could be an internal service provider (such as an HR service department providing a service to the wider organisation). Shared services An organisational arrangement for delivery of services whereby an organisation’s business units ‘share’ the services of a single provider. The costs of services are shared between the units and the central provider; similarly, those providing HR services within business units may be accountable to both the central or corporate HR and their immediate manager. A commonly noted advantage of shared services is that it tends to foster a cooperative approach within organisations and break down organisational silos. Stakeholder All those people who have an interest in a task or system you are completing or modifying. These may include customers, partners, employees, shareholders, owners, government, and regulators. Three-legged stool model See ‘Classic HR model’. Traditional HR model The traditional HR model is characterised by a either a single team of HR generalists, HR specialists (such as industrial relations experts, recruitment experts or training experts) and administration, or several teams organised by business units or locations in accordance with the corporate strategy for the delivery of HR services. Vertical integration See integration. 1st edition version: 1 Page 118 of 120 BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd Student Workbook Appendix – DuPont’s new HR model Appendix – DuPont’s new HR model DuPont is a company that operates in more than 90 countries, introducing new products and tackling challenges with innovation and science. As in every organisation, the success of DuPont largely depends on the skills and commitments of its employees. As such, HR is one of DuPont’s top priorities. Two challenges In order to have an efficient HR function, DuPont realised that each country having their own processes for managing people results in a considerable duplication of work. For example, the HR/employee ratio (employees per dedicated HR person) in the company was 1/60, while 1/100 is closer to industry best practice. One of the main goals of DuPont’s European HR transformation was therefore to improve that ratio, while maintaining or even increasing HR’s value to the business units. It was in the year 2000 when Tim Farrell, at the time HR Director for Europe, noticed that the company’s HR function faced two challenges: ● the roles and responsibilities of HR were unclear ● a large part of HR activities were transactional (administrative). Based on these facts, a project team was created in 2001 in order to complete a benchmarking study and to come up with solutions to overcome these challenges. The proposal included an updated integrated HR platform for EMEA (SAP 4.6C) and four options. Choosing a suitable model The new HR platform was the technological base that helped to drive standardisation across the 28 countries of the region. Furthermore the multinational has the critical size to centralise process delivery and achieve cost savings. The proposal of the project team included the following options: Option 1, the portfolio approach: Each unit has a devolved HR function and can decide how to run its HR services. In this model, different processes would be tolerated, or even encouraged. This model is clearly decentralised and allows flexibility for all organisations. Option 2, the common processes and technology approach: Common policies and practice standards are adopted in all business units across the region. There is a corporate HR function involved in policy design and practice coordination. HR service delivery is largely based at site level. This model is a mix of a centralised corporate HR function and a decentralised delivery with standardised process. BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd 1st edition version: 1 Page 119 of 120 Appendix – DuPont’s new HR model Student Workbook Option 3, the shared services approach: Countries and business units share a common approach for HR processes, with service delivery from one or more shared service centres across the region. This model has centralised and standardised processes; both together are expected to realise economy of scale. Option 4, the outsourcing approach: DuPont outsources all HR services to one supplier across the region. All countries and business units share a common HR service and approach delivered by the outsourcing provider. Through this model, economy of scale is created by centralising and standardising processes. Additionally, cost savings can be achieved by outsourcing the services to an experienced vendor.11 11 Adapted from: Josefowitz, O., 2008, The Global HR Delivery Model (Diploma thesis, Haute École de Gestion de Genève) viewed January 2014, retrieved from: <http://doc.rero.ch/lm.php?url= 1000,41,9,20090123123638-DM/Travail_de_Diplome_Olivier_Josefowitz_V1_2.pdf>. 1st edition version: 1 Page 120 of 120 BSBHRM501B Manage human resources services © 2014 Innovation and Business Industry Skills Council Ltd </div> </div> </div> </div> </div> </div> </div> </div> <div class="modal fade" id="report" tabindex="-1" role="dialog" aria-hidden="true"> <div class="modal-dialog"> <div class="modal-content"> <form role="form" method="post" action="https://idoc.tips/report/bsbhrm501-student-workbookpdf-2001-pdf-free" style="border: none;"> <div class="modal-header"> <button type="button" class="close" data-dismiss="modal" aria-hidden="true">×</button> <h4 class="modal-title">Report "BSBHRM501 Student Workbookpdf 2001"</h4> </div> <div class="modal-body"> <div class="form-group"> <label>Your name</label> <input type="text" name="name" required="required" class="form-control" /> </div> <div class="form-group"> <label>Email</label> <input type="email" name="email" required="required" class="form-control" /> </div> <div class="form-group"> <label>Reason</label> <select name="reason" required="required" class="form-control"> <option value="">-Select Reason-</option> <option value="pornographic" selected="selected">Pornographic</option> <option value="defamatory">Defamatory</option> <option value="illegal">Illegal/Unlawful</option> <option value="spam">Spam</option> <option value="others">Other Terms Of Service Violation</option> <option value="copyright">File a copyright complaint</option> </select> </div> <div class="form-group"> <label>Description</label> <textarea name="description" required="required" rows="3" class="form-control" style="border: 1px solid #cccccc;"></textarea> </div> <div class="form-group"> <div style="display: inline-block;"> <div class="g-recaptcha" data-sitekey="6LcHT8sZAAAAAPKfs_PZGhwvz-OHbUMuekQzz5xK"></div> </div> </div> <script src='https://www.google.com/recaptcha/api.js'></script> </div> <div class="modal-footer"> <button type="button" class="btn btn-default" data-dismiss="modal">Close</button> <button type="submit" class="btn btn-success">Send</button> </div> </form> </div> </div> </div> <script> $(document).ready(function () { var inner_height = $(window).innerHeight() - 250; $('#pdfviewer').css({"height": inner_height + "px"}); }); </script> <footer class="footer" style="margin-top: 60px;"> <div class="container-fluid"> Copyright © 2024 IDOC.TIPS. 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BSBHRM501 Student Workbookpdf 2001

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