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Study Guide for Exam 2

by: Talia Rosas

Study Guide for Exam 2 MGT 310

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Talia Rosas

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Completed study for exam 2!
Human Resource Management
Conroy, Samantha Ann
Study Guide
Human Resrouces Exam 2 Study Guide
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This 6 page Study Guide was uploaded by Talia Rosas on Thursday March 24, 2016. The Study Guide belongs to MGT 310 at Colorado State University taught by Conroy, Samantha Ann in Spring 2016. Since its upload, it has received 138 views. For similar materials see Human Resource Management in Business at Colorado State University.


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Date Created: 03/24/16
MGT 310 – Exam 2 Study Guide Training (Optional Reading: Chapter 5; Pages 168­181; 186­190)  1. Know what socialization is, what organizational culture is and how each influences firm  outcomes.   Socialization – Process by which newcomers are transformed from outsider to  participating effective members of the organization.   Socialization occurs naturally as employees enter an organization and start  interacting and getting social information.       Stages of Socialization  1. Anticipatory Socialization  st  All learning that takes place prior to the 1  day. (Will find through  realistic job preview, expectations start to form) 2. Encounter  Newcomers learn task associated with the job, clarify their roles, and  establish new relationships at work (1  6­9 months)   Orientation, relationship development   Learning roles, rules and norms  3.Settling in   Newcomers begin to master demands of job.       Socialization Outcomes   How does successful socialization affect individuals? Role clarity, better  performance, happier/healthier, more likely to stay.   How does successful socialization affect organizations? Performance, lower  turnover, stronger culture.   Organizational culture – A pattern of basic assumptions that are considered valid and  that are taught to new members. They way to perceive, think, and feel in the organization   People’s behavior   In artifacts  Conversations  Relationships  2. Understand the analysis that goes into making training decisions, how training programs are  designed, & how the effectiveness of training can be assessed.      Training Skill Types   General skills – are defined as those skills that employees possess that could be  used by them if they want to work in another organization (basic verbal skills,  math, computer skills)   Firm­specific skills – Specific to organization  Cannot go where you go. Can only be used in organization. Example:  Software that is only found at 1 organization.  General Firm­Specific  Employee preferred  Employer preferred   Transferable   Non­transferable   Employee paid or Firm will pay as a   Company will pay for them  benefit   Training Organizational Process (ADDIE)       Analysis   Organization: Strategy, culture, HR planning   Job/task: Skills required for job   Person: Specific performance of employees   Design   Training objectives       Development   Decide on methods      Implementation   On or off the job       Evaluation   Reaction, learning, behavior, results        Evaluation (An investment, cost/benefit   ROI)  Reaction – Did the trainees enjoy the training and think they gained from it   Learning – Did actual learning take place? Have employees picked up new  knowledge and /or skills.   Behavior – Are employees behaving differently on the job as a result of the training   Results – Is the organization seeing a return/results from training (higher production,  lower cost, higher profits, lower turnover, etc.?) 3. Be able to apply understanding to cases and situations.   Performance Management (Optional Reading: Chapter 6; Pages 198­221)  1. Know the performance appraisal process.    Identification (Defining Performance)   Job Analysis, related to strategic planning/org. success.       Measurement   Methods: How do you get the information   Sources: Where do you get the information   Errors: Things that reduce the validity and reliability      Management   Connect past and future  Feedback and Coaching/counseling  2. Understand the primary purposes of performance appraisal (administrative, developmental).   Administrative   Used in personnel decisions – Raises, promotions, layoffs   Developmental   Provide feedback   Improve communications   Evaluate goal achievement   Coaching, career planning, find cause of problem.   Other  Legal defense   Alignment of firm strategy with employees.  3. Be familiar with methods of rating performance that are used in firms and be able to select the  optimal method depending on the organizational context (relative/absolute,  trait/behavioral/outcome).   Relative – Compare people (Competitive culture, enforces differentiation, can create  conflict, lack in clarity of contribution) Example: GE  Absolute – Measure against pre­defined scale, non­competitive (encourages teamwork,  less conflict, often inflated/bias)  Trait – Worker characteristics  Behavior – Asses the employee’s behavior at work (E.g., critical incidents, behavior  checklists, behavior rating scales; take a long time to create)   Results cannot be measures reliably or at reasonable cost   Employee has little control (E.g. Auditor)   Results/outcome – Assess the outcomes of employee’s behaviors at work (E.g.  productivity measures)   Results can be measured reliably and at reasonable cost   Employee has control over results (E.g. Salesperson)  4. Know the pros and cons of various evaluators (self/peer/subordinate/customer.)   Evaluators   Supervisors: Understand the strategy/ big picture, know what performance looks like   Self: Avoid for Administrative purposes (leniency), best for developmental  purposes  Peers: Influenced by friendships; less differentiation among employees   Subordinates: Scared to be honest; can evaluate leadership; must ensure  confidentiality; leader must be open to feedback   Customers: Have limited perspective; external or internal; costly and time  consuming  360­degree feedback: using as many evaluators as possible for feedback 5. Understand the various rating errors that occur and how they influence performance management.  Leniency: an error where employees have usually high ratings   Severity: an error where employees have usually low ratings  Central tendency: an error where all employees are rated toward the middle   Halo/hors: allowing a global impression to influence all components  Halo (All good)  Horns (All bad)   Similar­to­me: an error when rating is inflated because the manager sees similarities with  the employee.   Recency: an error where most recent behavior influences ratings more than behavior of  the entire appraisal period (can fix this by giving more frequent ratings)  Contrast: a bias based on comparison to an employee just evaluated  6. Understand central legal considerations with performance management. 1. Job Analysis! 2. Provide clear, written instructions for evaluators  3. Allow employees to review their appraisals  4. Monitor rater agreement (higher is better) 5. Train raters (e.g., rates error training, frame­of­reference­training) 7. Know how feedback is ideally given to employees.   Frequency   Past AND future focus   Working with employees to determine cause of performance problems   Ability: (Not doing well at the job because they are not capable) – Training, job  change  Effort: Reward and recognition   Situation: (Specific to what the situation is) – Make change or work together to  find solution  Interpersonal skill: Listening to others, no predesignated assumptions 8. Be able to apply understanding to cases and situations.   Compensation (Optional Reading: Chapter 7)  1. Know the forms of compensation (Base/Incentives/Indirect).   Base: salary and hourly wages FIXED PAY  Incentives: rewards tied to specific behavior VARIABLE PAY; 91% of organizations  have variable pay for salaried, except employees and 13% of payroll is used on variable  pay for salaried, exempt employees. Incentives/PFP move away from entitlement  (believing one is inherently deserving)  Indirect: benefits, non­cash; health insurance, vacations, and unemployment  compensation 2. Understand strategic compensation decisions and drivers.   Strategy  Fairness  Organizational culture  Legal compliance  3. Understand internal equity and external equity.   Internal equity: refers to whether the compensation system rewards individuals in  different jobs in the firm equitably as a function of their overall value to the firm; fairness of internal pay structure (results of job evaluation)   External equity: refers to whether the compensation system within the firm is consistent  with the relevant labor market compensation; fairness of pay relative to the external labor market (results of market surveys) 4. Have a basic understanding of job evaluation types and steps.   Job Evaluation methods  Job ranking: ranks jobs on the basis of their relative worth; the simplest and  oldest system of job evaluation; often use paired comparisons to establish ranks  Job classification: A system of job evaluation in which jobs are classified and  grouped according to a series of predetermined wage grades; the description of  each of the job classes constitute the scale against which the specifications for the various jobs are compared       Point Method     Job Evaluation Steps (Point Method)   Determine compensable factors (i.e. the characteristics of jobs that an  organization values and chooses to pay for)   Assign points to compensable factors    Rate jobs based on the compensable factors    Total points and group into grades    Incorporate market data  5. Understand central legal considerations with compensation.  Title VII, ADEA, ADA  Fair Labor Standards Act  Minimum Wage  Child Labor   Hours of Work (Exemptions)   Equal Pay Act of 1963: Men and women doing the same (similar) job should be paid  the same   Lilly Ledbetter  6. Understand the different forms of pay­for­performance at different levels (individual, team,  organizational).   Individual   Pay increases based on performance evaluations  Lump­sum Bonuses  End­of­year bonus based on performance   Less expensive than merit pay overtime and tend to have a stronger  influence moving away from an entitlement culture  Merit pay is a form of Individual incentive/PFP: Pay increases based on  performance appraisals.    Improve merit pay: Improve performance appraisal accuracy;  encourage mangers to make distinction in pay among high and low  performers   Team   Pre­established levels of team performance   Measuring team performance to determine the pool of pay for the group, then distributing based on individual contributions may be a way to reduce the  negative outcomes of Team Incentive Plans   Organizational   Ties rewards to organizational outcomes  Productivity   Financial Performance   Pay that is tied to organization­level outcomes such as financial  performances or productivity   Examples: Gainsharing – uses group productivity measure to  determine payouts; Profit Sharing – uses frim financial measure to  determine payouts   Line of sight can be a problem (i.e., it is hard for individual employees to feel they influence these higher level outcomes), so it may be a stronger  motivator. Though gainsharing is more likely to motivate than profit sharing  These programs align the interests of employees with the employer    7. Understand the implications of implementing pay­for­performance (i.e., the positive and negative  effects).  Merit Pay Pros Cons   Correlated with high performance   Expansive  High performers would like the firm   Performance measurement, and  to have merit pay (thus, sorting effect  especially managerial performances  are possible) appraisals, is fraught with problems   Since some managerial performance  (e.g., bias) appraisals are used, merit pay   Managers often do not differentiate  decisions tend to take into account  when allocating merit pay, giving  many aspects of an employee’s  everyone the same or close to the  performance  same raise  Team Incentive Plans Pros Cons   Increase collaboration   Can lead to social loafing or free   Good when measuring team­level  riding (i.e., people get away with  performance is easier, better and more contributing very little and still  accurate  making money  Can create between­team competition 8. Have a basic understanding of what forms of pay­for­performance may be better in different  contexts.   Certain organizational conditions are important to successful use of Incentives/PFP  Alignment of the incentive/PFP program with frim and human resource  strategies (i.e., external and internal fit)   Variability in performance; if there is variability in performance, there is something on which pay can vary and a reason that PFP could have an effect on  performance outcomes  Performance measurement is critical – only firms with good performance measurement (i.e., valid!) should use incentives/PFP.   9. Be able to apply understanding to cases and situations.   


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