Manager Human Resource Guide

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					AIM Organisational Development Programme



                Workshop 3:
         Human Resource Management

                                2004




                      Trainer’s Guide


         AIDS/HIV Integrated Model (AIM) District Programme
                       First Floor, Nakawa House
                       Plot 3-7 Old Port Bell Road
                              PO Box 12009
                            Kampala, Uganda
  Tel: (041) 222-011 Tel: (+256) 031 260657/8, (041) 222011/19/20/21
                          Fax: (+256) 041 222035
                 info@aimuganda.org; www.jsi.com/aim
                             Acknowledgements
The AIM Programme wishes to acknowledge the following people and organisations for their
support in developing this training.


Milton Bakeebwa and Apollo Musinguzi of Development Initiative Consult Ltd.
developed the materials for this manual.


Some sessions were adapted from a workshop on Performance Management Systems developed
for World Education’s Ntinga Microenterprise Support Project in South Africa.


This publication was funded by the U.S. Agency for International Development (USAID) and the
Centers for Disease Control and Prevention (CDC) through the AIDS/HIV Integrated Model
District Programme (AIM), contract no. 617-A-00-01-00004. The views expressed are those of the
authors and do not necessarily represent the views of USAID and CDC.


AIM is a project of JSI Research & Training Institute, Inc., with partners World Education
and World Learning.
     AIM Organisational Development Programme                                                              Human Resource Management


                               Human Resource Management
                                     Trainer’s Guide

                                                   Table of Contents

1     Introduction ......................................................................................................................................... 5
2     Overview of Human Resource Management................................................................................. 8
3     Human Resource Policy ................................................................................................................... 12
4     Strategic Context of HR Planning .................................................................................................. 19
5     Job Descriptions................................................................................................................................ 26
6     Recruitment........................................................................................................................................ 29
7     Induction ............................................................................................................................................ 30
8     Human Resource Development: Training ................................................................................... 31
9     Performance Management ............................................................................................................... 35
10        Compensation ................................................................................................................................ 48
11        Action Plans ................................................................................................................................... 52
Evaluation and Close................................................................................................................................ 54
   AIM Organisational Development Programme                       Human Resource Management


                             Schedule of Activities

    TIME          LENGTH                                  TOPIC
  DAY ONE
  8.30 – 9.30        1 hr       1. Welcome and Introduction
  9:30 – 11:00    1 hr 30 min   2. Overview of Human Resource Management
  11:00 – 11:30     30 min             Tea Break
  11:30 – 1:00    1 hr 30 min   3. Human Resource Policy
   1:00 – 2:00       1 hr              Lunch
   2:00 – 2:30      30 min             HR Policy Cont’d
   2:30 – 3:30       1 hr       4. Strategic Context of HR Planning
   3:30 – 4:00      30 min             Tea Break
   4:00 – 5:00       1 hr              Strategic Context cont’d
   5:00 – 5:15      15 min             Evaluate the Day


    TIME          LENGTH                                  TOPIC
  DAY TWO
  8.30 – 8:45       15 min             Recap Previous Day
  8:45 – 10:15    1 hr 30 min   5. Job Descriptions
  10:15 – 11:15      1 hr       6. Recruitment
  11:15 – 11:45     30 min             Tea Break
  11:45 – 12:45      1 hr       7. Induction
  12:45 – 1:45       1 hr              Lunch
   1:45 – 3:45       2 hrs      8. Training
   3:45 – 4:15      30 min             Tea Break
   4:15 – 5:15       1 hr       9. Performance Management
   5:15 – 5:30      15 min             Evaluate the Day


    TIME          LENGTH                                  TOPIC
 DAY THREE
  8.30 – 8:45       15 min             Recap Previous Day
   8:45 – 9:45       1 hr              Performance Management cont’d
  9:45 – 10:15      30 min             Tea Break
  10:15 – 11:15      1 hr       10. Compensation
  11:15 – 11:45     30 min      11. Action Plans
  11:45 – 12:15     30 min             Evaluation and Close




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1 Introduction

Time:             1 hour

Resources:        Flip Chart, Markers, Nametags, Zop Cards, Pre-Training Self-Assessment

Methods:          Paired Introductions, Plenary Presentation and Discussion

Objectives:       By the end of the session, participants will be able to:
                          Interact freely with one another
                          List the objectives of the workshop



Activity details:

Welcome the participants to the workshop. Introduce any visitors or observers and explain why
they are attending.

Remind participants that this workshop is the third in a series of six. The workshops were
developed in response to a comprehensive Joint Institutional Assessment process of these 10
participating NGOs. The six crosscutting issues that were selected for workshops are:

•   Strategic Management
•   Monitoring & Evaluation
•   Human Resource Management
•   Financial Management
•   Resource Acquisition
•   District Operations

Introductions: Begin by telling participants that an important element of learning in this training
course will be learning from each other. Participant contributions are actively encouraged.

Participants are encouraged to share ideas and information from their own experiences, ask
questions, and discuss issues that arise in further detail. Informal discussions may continue
during meal times, in your small groups, possibly late into the evening!

Before further exploring our workshop topics, then, encourage participants to get to know each
other a little better.

Introduction Activity:

Ask participants to identify and pair up with any other participant who they do not know. Ask
participants to discuss with each other about their designations, their names, likes and dislikes. In
addition, each participant should ask the other any creative question about their social
backgrounds.

Participants are then asked to write each other details on a flash card and introduce each other.


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Expectations:

Ask participants to write at least two expectations on a flash card. Ask one participant to read
out all participants expectations as the facilitator writes them on a flip chart. The facilitator then
reads through each expectation and briefly comments on whether it will be met or not.

Objectives:

Introduce the goals and objectives of the workshop.

By the end of the workshop participants are expected to:
• Identify the role and importance of managing human resources in their organisations.
• Discuss the process of writing HR policies
• Identify and explain the Human Resource Planning Process.
• Describe the training and Development cycle.

Post the goals on a flip chart on the wall for the duration of the training. As you go through the
objectives, compare them to the expectations of participants and point out which ones will be
met, and which may not.

Logistics: Introduce the idea of the Classroom Volunteers and the Steering Committee as
explained below:

To help the facilitator with logistics and classroom management, participants will take turns
serving as volunteers for the day. The team of volunteers will lead the recap at the beginning of
the day, lead ice breakers after lunch, review the past day’s activities and evaluation in the
morning, and help keep time during breaks. Request participants to sign up as classroom
volunteers on the sign-up sheet posted at the back of the room.

In addition, the volunteer team attends a Steering Committee meeting at the end of the day, to
give feedback to the facilitator and workshop organizers. They ask for feedback on the
workshop’s methods and content, as well as logistical issues such as meals and lodging, from
their fellow participants and share it with the workshop organizers. In this way, the volunteers
not only provide logistical assistance to the facilitator, but also give participants a voice in the
management of the workshop. (Note: For the last day of the training, it may be preferable not to
hold a Steering Committee meeting, or hold it during lunch, so that participants can travel
home.)

Remind participants that there will again be a series of Consultancy Clinics held after the
workshop. A sign-up sheet is next to the door.

Make announcements about logistical issues such as meals and out of pocket expenses. Go over
the day’s schedule.

Distribute the Pre-Training Self-Assessments. Tell participants that this assessment gives
them a chance to reflect on their own learning. They will fill it in at the beginning of the
workshop, and again at the end to see where they have learned new skills.

The Pre-Training Self-Assessment also gives the trainer a measure of how much experience
participants have with the workshop topics, so that he or she can focus the workshop
accordingly.


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Finally, the Post-Training Assessment gives the trainer and course organisers a sense of how
successfully the learning objectives have been met in the group.

Emphasise that this assessment is not a test of the individual’s ability. No one except for the
trainer and the AIM representative will see the self-assessments; AIM will not share them with
the participant’s organisation.

Note: Participants may be requested to fill out the Assessment as they are entering the training
room in the morning, to save time.




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    AIM Organisational Development Programme                                   Human Resource Management


2 Overview of Human Resource
  Management

Time:             1 hour 30 minutes

Resources:        Flip Chart/Board, Markers/Chalk, Masking Tape, Handout

Methods:          Brain Storming, Group Discussion, Question and Answer, Lecture/Presentation

Objectives:       By the end of the session the participants should be able to:
                          Identify the role and importance of managing human resources in the
                                  organisation
                          Align human resource strategy with organisational strategy
                          Explain the relationship between line management and the human resource
                                  function




Procedure:


“You can get capital and erect buildings, but it takes people to build a business”

Ask participants to give their understanding of this quotation.

?        What is Human Resource Management?

Human Resource Management is a strategic and coherent approach to the management of an
organisation’s most valued asset – the people working there who individually and collectively
contribute to the achievement of its goals.

?        What are the concerns of HRM (that is people and performance)?

1. Concern for people

•   It is a fact that competitive advantage is achieved through people
•   People make the difference
•   Concern for people means attracting, retaining, developing and motivating the right employees
    and helping them to develop an appropriate culture and climate.
•   Concern for people implies an ethical approach to their management that is, respect for the
    individual, mutual respect, procedural fairness and transparency




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2. Concern for performance

•   HRM is concerned about the contribution individuals and teams make to improving
    organisational performance
•   This means ensuring that the right skills are available and developed.

3. Characteristics of HRM

•   Strategic integration of business and HR strategies
•   Coherence- the need to adopt a coherent approach to the provision of mutually supporting and
    integrated HR policies and practices
•   Commitment – the need to gain the commitment of the people to the organisation’s missions and
    values
•   Treating people as assets or human capital – to be invested in through training and development
•   Corporate culture- the need for a strong corporate culture expressed in mission and value
    statements and reinforced by communication, training and performance management.


Group Work

Ask participants to work in small groups. They should discuss and outline on the flip charts the
role and importance of human resource management in an NGO. They will have 15 minutes to
work.

When the groups are finished, ask them to briefly present their answers. Connect responses to
the following lecture.


Key HRM activities

The key activities of HRM carried out by both line managers and HR practitioners are:

Organisation

•   Organisation structuring - developing an organisation which caters for all the activities required,
    groups them together in a way which encourages integration and co-operation
•   Job design and role specification - deciding on the contents of the jobs- their duties and
    responsibilities and the relationships that exist between job holders and other people in the
    organisation
•   Organisational development- stimulating, planning and implementing programmes designed to
    improve the effectiveness with which the organisation functions and adapts to change.

The employment relationship

•   Improving the quality of the employment relationship
•   Creating a climate of trust and self propulsion
•   Developing a more positive psychological contract
•   Achieving a highly committed organisation




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Resourcing

•   Human resource planning- assessing future people requirements in terms of both numbers and
    all levels of skill and competence. Formulating and implementing plans to meet those
    requirements through recruitment, training, development etc
•   Recruitment and selection- obtaining the number and type of people the organisation needs

Performance management

Getting better results from the organisation, teams and individuals by measuring and managing
performance within agreed frameworks of objectives and competence requirements; assessing
and improving performance

Human resource development

•   Organisational and individual learning
•   Skill improvement through systematic approach to training
•   Heard of institutional memory? What is its use in organisational development? Relate this to the
    culture of information management, digital growth and information technology solutions. Does
    the organisation have a management information system? How do you create one?

Reward management

•   Job evaluation- assessing the relative size of jobs as a basis of determining internal relativities
•   Pay – developing and administering pay structures and systems
•   Non-financial rewards- providing employees with non-financial rewards e.g. recognition, increased
    responsibility and opportunity to achieve and grow.
•   Employee benefits- providing benefits in addition to pay which cater for personnel security and
    personal needs

Employee relations

•   Employee relations- managing and maintaining formal and informal relationships with trade
    unions and their members
•   Employee involvement and participation – sharing information with employee and consulting
    them on matters of mutual interest
•   Communication- creating and transmitting information of interest to employees.

Health, safety and employee services

•   Health and safety – developing and administering health and safety programme
•   Employee services- providing welfare services and helping with personal problems.




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Challenges to HRM

Environmental and contextual changes present a number of competitive challenges to
organisations, which means that HR has to be involved in helping to build new capabilities. The
challenges include:

•   Globalisation- requires organisations to move people’s ideas, products and information around
    the world to meet local needs. New and important ingredients must be added to the mix when
    making strategy.
•   Technology – challenge is to make technology a viable, productive part of the work setting
•   Business growth
•   Intellectual capital
•   Change and ability to cope with change.




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3 Human Resource Policy

Time:             1 hour 30 minutes

Methods:          Group Discussion, Experience Sharing, Question and Answer, Presentation

Resources:        Handout, Flip Charts, Group work

Objectives:       At the end of the session, participants will be able to:
                          Define the terms policy and human resources policy
                          Explain the components of human resources policy
                          Identify the importance of human resources policy in the organisation



Procedures:

Ask participants:

?       What is a Personnel Policy?
        What are its components?
        Why is it important to adopt a policy?

Every organisation should adopt consistent policies that will guide the management of personnel
issues. Having a consistent policy applied fairly and transparently to all employees helps in
resolving disputes. The personnel policy should be detailed in an employee handbook available
to all staff.

Components:

Each organisation will have different policies depending on its particular situation. Below are
listed some common topics that can be addressed in a Personnel Policy.

Go through the major categories in this list and answer participants’ questions. This list is
intended as a resource for participants when they are developing policies; it is not necessary to
discuss every section.

Group Work:

Ask participants to work with a colleague from their NGO and go through the list and mark
those areas for which their organisation does NOT have a policy. Give them 30 minutes to
begin drafting policies on these topics. Circulate among the pairs and help them decide what to
consider when writing these policies. Emphasise that the policy must be fully developed and
finalised in consultation with the senior management and perhaps other staff of the organisation.




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    Common Components of a Personnel Policy Handbook

A. Organisational Description

Introduce the organisation and its legal status, including:

•   Mission and Vision Statements
•   Statement of the organisation’s legal status as an NGO

B. Definitions

Next, the policy should explain the meaning of the terms that will be used, especially in regard to
employment status. These might include the definition of:

•   “employee”
•   “regular” versus “temporary” employees
•   “full-time” versus “part-time” employees
•   any other terms that might be unclear

C. Recruitment and Employee Selection

This section should outline the procedures for recruiting employees. Having a system in place
helps ensure a fair process that is the same for all applicants.

1. Recruitment
Job Descriptions – up-to-date descriptions for each post.

Posting of the Job Announcement – policies for when and how long a job opening should be posted
internally and externally. For example, some organisations post jobs internally for one week
before making the job announcement publicly.

Application Documents – List what documents will be required from all applicants (such as a C.V.
and references).

2. Employee Selection Process
Screening of Applications – Specify general criteria for screening.

Interviews – Who will typically conduct interviews? It is suggested that all staff who will work
closely with the new hire be involved in interviewing, not only the supervisory staff.

References - Process for reference checks, number of references to be required.

Rejected Applicants – Process for notifying rejected applicants.

Employment of Relatives - To avoid conflicts of interest, some organisations forbid the hiring of a
person for a position in which he/she would be directly supervised by a relative. It is also
suggested that employees notify the NGO’s management if they have a family relationship to a
person under consideration for employment. This should be governed by Ugandan law.




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D. Hiring and Replacement

In this section, explain the process for hiring new employees once they have been selected.

•   Decision to Hire/Promote – State the general criteria for deciding when to hire for a new position, or
    to replace an outgoing employee in an existing position.

•   Letter of Hire / Employment Contract – State what provisions should be included in the letter of hire.
    It is helpful to develop a template for the Letter of Hire that includes all the necessary clauses so
    that nothing is left out by mistake.

•   Documentation – List documents that will be maintained in the employee’s file, such as letter of
    engagement, CV, contact information for next of kin, and a copy of the person’s passport or
    national ID card.

•   Initial Probation – Length and terms of probationary period for new employees. In many
    organisations, newly hired employees are on probation for the first 3 to 6 months. At the end of
    this period, the employee should undergo a review with his/her supervisor to assess performance,
    and if satisfactory, will be notified that the probation period has ended. Unsatisfactory
    performance during the probationary period may result in termination of employment.

E. Work Schedule and Hours

This section should outline working hours and procedures related to accounting for time, such as
filling out time sheets.

•   Regular Work Schedule – specify the hours of the day and days of the week for regular workdays.

•   Timesheets – Procedures for filling them out.

•   Holidays – List the official holidays observed by the organisation.

•   Attendance policies – consequences for late arrival and absence

F. Salary and Compensation

In this section, state the policies for establishing and paying salaries.

•   Salary Scale – Some organisations develop base pay ranges for each position.

•   Form of Payment - Frequency and time of the month payments are made.

•   Bonus – Specify policy for payment of yearly bonuses, if any.

•   Annual Increase – Specify when and on what criteria increases will be granted.




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G. Performance Appraisal and Grievances

•   Timing of Performance Appraisals – Explain when and how frequently appraisals will take place, and
    how they will be documented.

•   Promotions – State the criteria for promotion.

•   Grievances – State the process and designated personnel to whom complaints should be directed.

H. Warning System and Termination of Employment

It is particularly important to have a clearly stated policy for the difficult process of employment
termination. If an employee is unhappy with the decision, it is helpful to have a fair process in
place by which decisions about termination are made.

1. Warning System

Describe the procedure for giving progressive official warnings to an employee. Outline what
types of behaviour by an employee can lead to a warning (such as negligence, failure to fulfil
one’s job description, or poor co-operation with colleagues).

2. Termination of Employment – For each type of termination below, outline the minimum
advance notice the employee will receive from the NGO, and what salary and benefits the
employee will be entitled to receive, such as payment for vacation accrued and severance. This
should be based on Ugandan law.

•   Voluntary Termination – State the minimum advance notice required from the employee before the
    effective date of resignation.

•   Probationary Dismissal – Conditions for dismissing an employee during the initial probation period.

•   Reduction in Force – Some organisations put a statement in the employee’s letter of hire explaining
    that in situations where the employee’s position is no longer needed or funds are no longer
    available, the NGO has the right to let the employee go.

•   Summary Dismissal – Define the conditions under which an employee can be dismissed without
    warning and without severance. This action should be reserved for serious infractions such as
    drug use and theft.

•   Absence or Abandonment of Service – disciplinary action for unauthorised absence or failure to return
    to post for a given period of time.

3. Severance – State the amount of severance payment available to employees based on their
length of service; the maximum amount available, if applicable; and conditions under which
severance is and is not available.

4. Outstanding Advances – Policy for clearing any outstanding advances in pay that the
employee may have received.




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I. Employee Benefits

Every NGO will not necessarily offer all of the following benefits. For those benefits that you
do offer, the Personnel Policy should provide a clear explanation of who is entitled to what
benefits, and under what conditions.

For each benefit, state what is available to full versus part-time employees? For part-time
employees, specify the percent time an employee must work in order to receive each benefit.

1. Medical Benefits
• Health Insurance– If employees receive health insurance, provide information on:
   • the proportion of premiums to be paid by employees themselves
   • contact information for the insurance carrier
   • forms and procedures for making claims
   • deductibles and maximum benefits
   • types of medical costs covered
   • coverage of dependants/family (specifying which family members are eligible)
   • a copy of the insurance plan

•   Reimbursement of Medical Costs - If employees receive reimbursement of medical costs rather than
    insurance coverage, provide information on:
    • Maximum benefits
    • Coverage of dependants/family (specifying which family members are eligible)
    • Types of medical costs covered
    • Documentation required
    • Reimbursement process
    • Costs for which employees are responsible

2. Paid Leave – State who is eligible for each type of leave that your organisation offers,
including policies for temporary and part-time employees.

•   Vacation – Number of days; how vacation is accrued; rules for carrying days over from one year to
    the next; procedures for requesting leave.

•   Sick Leave – Number of days and how accrued; rules for carrying days over; documentation
    required, if any; procedure for notifying the organisation of sickness.

•   Maternity Leave – Length of leave; conditions for holding the position open during leave; payment
    during leave, if any; notification of the organisation; consequences if employee does not return.

•   Paternity Leave – Length of leave and any other conditions.

•   Bereavement Leave –length of leaves and conditions for taking it.




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3. Additional Benefits – Describe any other benefits provided, such as:
   • Savings/Pension Plan
   • Staff Development
   • Children’s education allowance
   • Leave Travel assistance
   • Uniforms

J. Travel

•   Travel Advances – Including the procedures for taking out and reconciling a travel advance, and the
    circumstances under which an advance is allowed.

•   Per Diem/ Out of pocket and Accommodation – List the rates to be paid for different circumstances.

K. Office Resources

This section should provide the rules for the use (both personal and official) of the following
resources:

•   Office Premises – Rules for after-hours use and visitors.

•   Telephones – Explain rules for making personal phone calls (local, long-distance or overseas) and
    reimbursing the project. If there are procedures for making and logging business calls, they
    should also be included.

•   Desktop Computers

•   Portable Equipment (e.g. laptops and mobile phones) - Regulations for checking out and checking in
    this equipment. Responsibility for damage or loss.

•   Photocopies – Some offices do not allow photocopying for personal purposes, while others do if the
    employee reimburses the project. Make these rules clear.

•   Consumable office supplies – State the rules for use of office supplies such as paper and envelopes for
    personal purposes.

•   Vehicles– Regulations for official use and documentation.




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L. General Expectations for Workplace Behaviour

In this section, spell out the guidelines for appropriate behaviour in the workplace.

1. Policy Against Personal Financial Gain         - Employees should not make financial gain as a
result of being an employee of the NGO. This includes:
     • granting favours to vendors or contractors for goods and services to the NGO;
     • receiving commissions from vendors or contractors;
       • accepting gifts, favours or money from anyone who may benefit by their relationship to an
         employee;
       • giving preference in hiring or procurement of goods to a relative;
       • keeping for personal gain any discount given by a vendor or service provider to the NGO;
       • Operating a personal business from the office premises.

3. Sexual Harassment – Some organisations develop policies and guidelines to prevent sexual
harassment.

4. Discrimination – Some organisations develop policies to prohibit discrimination on the basis
of religion, ethnicity, sex, etc. in hiring and other activities.

5. Dress – Outline the office dress code, if any.




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4 Strategic Context of HR Planning

Time:             2 hours

Resources:        Flip Charts, Markers

Methods:          Discussion, Question and Answer, Demonstration

Objectives:       At the end of the session, participants will be able to:
                          Explain precisely the contents of the human resources policy
                          Demonstrate the key elements of the human resources policy




Acknowledge to participants that many NGOs simply lack the resources to fill the gaps in
staffing that they have identified through human resource planning. The following exercise is
intended to help them think about creative solutions for this common problem.

Ask participants to work in groups for 20 minutes. Give them the following scenario to read:

A young and growing NGO is struggling to implement its programs with a small staff. The
organisation has a portfolio of several programs, but only five staff to manage them all. The
executive director sometimes does the monthly bookkeeping, and the one of the Project Co-
ordinators doubles as a Monitoring & Evaluation Officer. With everyone playing so many roles,
sometimes an important task is forgotten or left incomplete. The NGO would like to hire more
staff to ease the burden, but it will be at least six months before any new funds are obtained.

Ask the groups to answer the following questions:

?       Is this situation common in Uganda?
        What can this NGO do to improve its human resource situation given its limited
        funds?

Relate responses to the following lecture & discussion on Human Resource Planning.

Ask participants:

?       What is human resource planning?
        Why is it necessary to conduct HR planning?
        How can it be related to strategic management or overall organisational objectives?

Human Resource Planning (HRP) previously refereed to as manpower planning, is the process
of getting the right number of qualified people into the right job at the right time. Human
resource planning is the system of matching the supply of people- internally (existing employees)
and externally (those to be hired or searched for) - with job openings the organisations expects
to have over a given time frame.



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HRP contributes significantly to the strategic management process, in that it provides the means
to accomplish the desired outcomes, namely achieving objectives. The means here denotes the
role HRP plays in ensuring that the organisation has the right number of quality people available
to achieve objectives through strategy implementation. It is therefore a macro approach to
planning for human resources.

Strategically - linked HRP is based on a close working relationship between HR practitioners and
line managers. Human resource practitioners serve as consultants to line managers concerning
the people management implications of business objectives and strategies. Line managers, in
turn, have the responsibility to respond to the business implication of HR objectives and
strategies.


The human resource planning process
Human resource planning consists of six basic steps:
• Identify organisational objectives and strategies (these are obtained from the business plan which
   resulted from the strategic planning processes followed)

•   Determine the impact of the organisation’s objectives on specific organisational units. For this
    purpose the cascade approach can be used, whereby the organisation’s long term strategies are
    translated into the shorter term performance objectives and time schedules per division and
    department

•   Define the skills, expertise and total number of employees (demand for human resources)
    required to achieve the organisation and department objectives: different statistical methods,
    managerial estimates etc. are available to do forecasting

•   Do an analysis of the organisation’s current human resources: doing a skills inventory will shed
    light on the number of current employees in terms of their different competencies, skills, training
    levels, qualifications, work experience etc

•   Determine the additional (net) human resource requirements in light of the organisation’s current
    human resources

•   Develop action plans to meet the anticipated human resource needs: these may include a
    comprehensive succession plan for each department, resultant recruitment strategies, the design
    and implementation of managerial development and other training programs, making available
    bursary schemes for current participants who may eventually fill scarce positions, designing
    compensation packages to attract and retain quality staff, etc.




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             Human Resource Strategy Worksheet

   Human Resources Issue                      Analysis: Evidence Options




   What is the HR problem, gap, or            What are the dimensions of the issue?
   Opportunity identified a result of         • Evidence of the issue
   changes in the following?                  • Scope
   • Business environment                     • Coverage/applicability
   • Business strategy                        • Potential business impact
   • Organisational circumstances             • Alternative solutions and their pros and cons




   Management Actions/resources               Measures/Targets




   What course of action will be              How will the results be measured?
   implemented?                               • Outcomes
   • Strategy of 1-2 years                    • Measures/evidence
   • Specific action programs                 • Target levels
   • Responsibility assigned
   • Timing for completion
   • Financial and staff resources required




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 Organisational and human resource planning

 The following depicts the relationship between organisational planning and human resource
 planning. This is an extremely important consideration for organisations, since the HRP process
 determines, to a very large extent, the way organisational strategies are translated into HR
 strategies, how the other HR functions (e.g. recruitment, selection, performance management
 and development) are structured and performed.


 Factors
    Economic
    Competition
    Government
    action
    Historical data
    Others                  Organizational     Divisional          Skills and
    Nature of               objectives         Department          abilities
    firm                                       objectives          required



        Skills
    Inventory         Net human                      Types, numbers,
                      resource                       Human resources
                      requirements




Negative:
Layoff, termination,
resignations, retirement


 Managerial succession planning

 Why pay special attention to managerial succession planning? The fact is that the management
 cadres, especially top and middle level managers, play an extremely important part in taking the
 organisation into the future and ensuring not only survival but also continued growth and
 financial success.

 The organisation’s management determines the culture of the organisation, and through its
 generic management functions, planning, organising, leading and control they are crucial to the
 company. Furthermore, good managers are difficult to replace should they leave the
 organisation, their recruitment is very expensive and continuity is lost when unexpected changes
 have to be made. Proper replacement schedules need to be put in place.




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The managerial succession planning consists of the following activities:

•   Identify projected vacancies e.g. through affirmative action, promotion, organisational expansion
    or restructuring, retirement, natural attrition, etc)
•   Choose replacement candidates for each position
•   Draw up replacement charts that indicates replacement possibilities in terms of time required to
    get ready additional technical training and managerial development programs required
•   Design and implement development plans for selected employees
•   Conduct a bi-annual succession planning review and make adjustments where these may be
    required.

Human resource planning (job analysis)

Most facets of human resource management have their roots in the jobs that people perform. As
such HRM always involves two fundamental aspects namely:
• The job that needs to be performed individually or collectively, and
• The characteristics of the people occupying those jobs.

The importance of understanding jobs and their requirements
There are four very good reasons why in-depth attention must be given to the dynamics of the
individual jobs:

•   The goals and strategies of the organisation can only be attained through the joint, interdependent
    effort of individual contributors. It is for this reason that the strategic intentions of the
    organisation as it is typically found in vision and mission statements must be reflected in and built
    into individual jobs. Failure to do so is bound to relegate many strategic planning activities to
    paper exercises.

•   Jobs and their requirements represent the point of departure for all the human resource
    management functions such as recruitment, selection, compensation and so forth.

•   Accurate job information provides the most objective yardstick for enabling fair and non-
    discriminatory HRM. When HR decisions are based on accurate information about the
    requirements of jobs, the risk of unfair practices can to a large extent be avoid. In many cases for
    example, courts have insisted on job analysis in order to establish a base for decisions when
    settling cases involving allegations of unfair HR practices

•   The jobs people perform and the ways in which they think about them are prime determinants of
    the extent to which work is experienced as a meaningful activity

In summary, jobs do have their origins in the goals of the organisation, but more specifically, in
the modern organisational context they must also be considered to have their origins in the
needs of customers.




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Group Work:

Ask participants to pair up with a colleague from their NGO and fill out the human resource
planning form. (20 minutes)

Ask the groups to share some of what they have planned.




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                              Exercise:
                       Human Resource Planning
List the main strategic objectives of your organisation. Then for each objective, estimate the
number of employees needed to carry out the objective, and the skills these people will need to
have.

Next, go back through the list and make a note of how many employees are currently available
for each objective. How many additional personnel are needed for each?

         Objective             # of Employees      Skills Needed      # of Additional
                                   Needed                               Employees
                                                                         Needed




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5 Job Descriptions

Time:             1 hour 30 minutes

Resources:        Flip Chart/Board, Markers/Chalk, Masking Tape, Template (job description
                  template)

Methods:          Brain Storming, Demonstration, Question and Answer, Presentation

Objectives:       By the end of the session the participants should be able to:
                          Define job description
                          Identify the procedures on how to prepare job descriptions
                          Demonstrate skills and techniques used in job descriptions




Procedures

Introduce the session by asking these questions

?       What is a job description?
        What does a job description cover?
        How is it written?
        Do you have them in your NGOs?

DEVELOPING JOB DESCRIPTIONS

[The following session was adapted from World Education/South Africa training on Performance Management
Systems, developed for the Ntinga MSP Project.]

A job description should include the following:

•   The scope of the job
•   The business results influenced
•   The reason the job exists; the value the job adds to the organisation
•   The identification of key clients and donor markets.
•   Responsibilities and objectives

If you are a manager or supervisor, a job description can help you by:
• ensuring that an employee’s understanding of his or her role corresponds to yours;
• making your subordinate aware of the impact of his/her role and how it influences the
    productivity and success of the organisation’s work;
• identifying the key clients and donors your employee responds to;
• identifying whom your employee relies on to meet his/her objectives;
• Identifying the value that the employee’s role adds to the organisation.


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Responsibilities

Responsibilities explain the job description in measurable terms. They clarify what is expected
from an individual in a specific position. They respond to the question, “What is critically
important for one to achieve?”

Each job responsibility should be clarified further with specific requirements and objectives.

The identification of responsibilities is the key starting point for the effective management of
human performance. Objectives serve to clarify the responsibilities, and serve as the yardstick
against which employees can evaluate their own performance, as well as for managers to evaluate
them.


Group Work

Ask participants to individually fill out the Job Description worksheet, then use it as a basis to
write a description for their own jobs. (20 min)

Then ask each person to work with one or two others to share the job descriptions they have
written and to critique each other’s work. (30 min)

Reconvene the class. Ask what was challenging about writing the job descriptions. Together,
create a summary list of the characteristics of a good job description.




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              Exercise: Creating a Job Description

Name:


Job Title:


Why does your job exist?




What value does your job add to the organisation? What would happen if your job did not exist?




Who are your most important relationships with on the job?




How does your job impact on the achievement of the organisation’s objectives and success?




List the responsibilities and objectives of your job.




Now write a complete Job Description for your position.



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6 Recruitment

Time:             1 hour

Resources:        Flip Chart/Board, Markers/Chalk, Masking Tape

Methods:          Brain Storming, Demonstration, Question and Answer, Presentation

Objectives:       By the end of the session the participants should be able to:
                          Define recruitment and selection functions
                          Identify the procedures involved in recruitment and selection process
                          Demonstrate skills and techniques used in recruitment and selection




Procedures

Introduce the session by asking participants:

?       What is recruitment and selection?
        What does recruitment and selection involve?
        How do you write a job advert?
        How do you recruit staff in your NGOs?
        What problems do you encounter in the recruitment and selection process?

Activity

Divide participants into three groups and ask members of each group to discuss and write a job
advert to be inserted in a daily newspaper.

Participant representatives then present as the rest critique these presentations.

As a group, generate a list of characteristics of a good recruitment process.




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7 Induction

Time:             1 hour

Resources:        Flip Chart/Board, Markers/Chalk, Masking Tape

Methods:          Brain Storming, Demonstration, Question and Answer, Presentation

Objectives:       By the end of the session the participants should be able to:
                          Define Orientation and Placement functions
                          Identify the procedures involved in orientation and placement process
                          Demonstrate skills and techniques used in orientation and job placement




Procedures

Introduce the session by asking:

?       What is job induction and job placement?
        What does job induction and placement involve?
        How do you practice this?
        How do you implement job induction and job placement in your NGOs?

Activity

The facilitator asks the participants to form four groups. Each group is asked to discuss and
develop the procedures for inducting new staff. (20 minutes)

Ask the groups to report back. As group representatives present, other participants critique.

Create a list in summary of the procedures involved in job induction.




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8 Human Resource Development:
  Training
Time:             2 hours

Objectives:       At the end of the session, participants should be able to:
                          Describe the training and development cycle




Procedures

Ask participants these questions:

?       What is training needs assessment and how is it done?
        Do you undertake TNA in your NGOs? How?

Activity: Participants are asked to pair up and carry out a Self-Training Needs Assessment by
asking each other:
• What do you do?
• What does this involve?
• What challenges/constraints do you encounter?
• How are the above challenges met?

Participants will present according to their paired groups.

Human resources development

Human resource development encompasses all the activities related to the development of
human resources at the individual as well as the collective level. The term human resource
development can be defined as the integrated use of training and development, organisation
development and career development to improve individual, group and organisational
effectiveness.




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                                   HRD: An integrated approach

                                             Organisational
                                             Development




                                               Human
                                              Resource
                                             Development



    Training and                                                               Career
    Development                                                             Development



Definitions related to Training and Development

A number of terms exist which to some extent relate to personal growth and performance
improvement. In order to be clear about what the meaning of training and development is, it is
necessary to distinguish between education, development and training.

The term education refers to a planned learning intervention intended to help individuals qualify
for advancement. Its emphasis is on individual career preparation. The educational credentials
obtained through such learning – such as degrees, diplomas or certificates- therefore enable
individuals to be considered for advanced levels of responsibility in their careers.

The term development is used when the focus is on stimulating new ideas and insights through
planned learning that is not necessarily job related. It gives individual opportunities to grow and
it provides organisations with employees who are capable of working smarter rather than harder
because of increased experience and knowledge from which they can creatively draw. Examples
of developmental activities in an organisational context include:

•   Participating in projects not directly related to one’s job.
•   Job rotation.
•   Participating in developmental assessment centres.
•   Attending conferences, locally and abroad, etc.

As in the case with education, developmental leading activities are future oriented and not
specially related to one’s current job, but they differ in that they do not result in educational
credentials.

Training on the other hand refers to a short term, planned learning intervention that is intended
to establish or improve a match between current job requirements and the knowledge, skills and



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attitude of the individual. Its major focus therefore is on ensuring the acquisition of the required
knowledge and skills for presently known tasks. Training enables people to meet the minimum
requirements of the jobs and to improve what they do. When people have undergone training
they should be able to apply it immediately to their jobs.

All the above definitions have something in common- namely the concept of learning. It is
important to realise that all developmental and change efforts involve learning processes. Given
the fundamental role that learning plays, the next section is devoted to obtaining an
understanding of this very important topic.


The importance/need for training

It’s important that the employees be inducted into training programmes to improve their job
knowledge, skill and future performance. The need for proper training is increased by the
following considerations:
• Increased productivity
• Improvement in employee morale
• Availability for future personnel needs of the organisation
• Improvement in health and safety
• Reduces on employee supervision
• Personal growth
• Organisational stability


The training and development cycle

Training and development in organisations consist of a cycle of events as depicted in the figure
below and once evaluation has taken place we are in a position to determine whether the needs
have been fully addressed or whether further intervention is necessary in which case the cycle
repeats itself.

Needs analysis

The purpose of a needs analysis is to gather information about the knowledge and skills that are
needed to improve the performance of individuals and ultimately of the organisation as a whole.
There are essentially two sources of learning needs, namely:
Organisational strategies and goals and individual development plans.




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The training and development cycle


                                   Analysis of Learning Needs




        Evaluate learning
                                                                      Select solutions for
                                                                      learning needs




                                      Implement learning



In an organisation analysis information is gathered about issues such as:
• New technologies that will be implemented
• Strategies to upgrade service and quality levels
• New markets that will be served by the organisation
• Changes in the environment of the organisation




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9 Performance Management

Time:             2 hours

Resources:        Flip Chart/Board, Markers/Chalk, Masking Tape, Handout

Methods:          Brain Storming, Demonstration, Question and Answer, Group Discussion

Objectives:       By the end of the session the participants should be able to:
                          Explain how to carry out performance appraisal
                          Describe the common techniques of performance appraisal
                          Identify the challenges of performance appraisal system into the organisation




Ask participants

?       What is Performance management?
        What performance management system will entail?
        What is performance appraisal?
        Why do we carry performance appraisal?

Performance management: the context

During the 1980’s the Total Quality Management movement developed methods whereby all the
management tools, including performance appraisal was used to ensure the achievement of goals.
Tools such as compensation management, job design and training and development joined
performance appraisal as part of a comprehensive approach to performance. This implies that
each individual employee’s performance is linked to that of his department, which in turn, is
linked to that of the whole organisation. These links are established through the strategic
management process, which determines that performance should be managed in such a way that
the organisation can reach its objectives.

Performance management, which is a much broader concept than performance appraisal,
involves having in place systems and methods that translate the objectives of strategic
management into individual performance terms through HRM practices.




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The typical performance system would include the following elements:

The organisation has a shared vision of its objectives, or a mission statement, which it
communicate to all employees



Strategies are determined that will assist the organisation in achieving its objectives



These strategies are translated to departmental or sectional strategies



Performance management targets are set for individuals- these relate to both operating unit and
wider organisational objectives



Regular formal review processes are conducted to assess individual performance in terms of the
extent that individual targets were met or how well jobs were done (this is the traditional
performance appraisal process)



The review process is used to identify training and development needs and compensation
outcomes


Effectiveness of the whole process and its contribution to overall organisational performance is
evaluated; this enables the organisation to allow for changes and improvement.


Performance appraisal

Ask:

?       What methods are used to assess employee performance in your NGO?

As was illustrated above, performance appraisal (PA) is an important component of the
performance management process. Although the focus in the rest of this section will be on PA,
it should always be kept in mind that it is only a component of a much larger process.

The main consideration of organisations regarding performance appraisal are the objectives of
the appraisal process, the criteria to use in evaluation, what the most desirable appraisal process
is, performance appraisal methods, common rater errors who should do the ratings, and the
appraisal interview.




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The objectives of performance appraisal

According to Carrell et al. [1997] the objectives of performance are evaluative and
development in nature:

Evaluative objectives:
• compensation decisions
• staffing decisions
• evaluating the selection system

Development objectives:
• performance feedback
• direction for future performance
• identifying training and development needs
• Performance appraisal criteria

It is always difficult to decide what to rate employees on during performance appraisal process.
The best way to decide is to use the information provided by job analyses to make decision.
Carrell et al. [1997] suggests that three criteria can be considered. There are, however, some
advantages as well as disadvantaged to all these, whether they are used singly or in combination:

•   Trait-based criteria: Based on the personal characteristics of the employee, e.g. loyalty,
    dependability, creativity, etc, here the focus is on who a person is and not on what he does or how
    well he does it.

•   Behaviour-based criteria: Based on specific behaviours that lead to job success. E.g. the rater
    may be required to rate a teller on how well he “communicates with clients”

•   Outcome-based criteria: Based on what was accomplished or produces, rather than how. This
    criterion is not valid for every job, and it is often criticised for missing important aspects such as
    “quality”.




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The appraisal process

A genetic performance process can be presented as follows:

Determine performance requirements


Choose an appropriate appraisal method


Train the raters


Discuss the methods with employees


Appraisal according to job standards


Give employees feedback on the appraisal


Determine future performance goals


Determine training needs


Make performance based compensation decisions


Appraisal methods

There are numerous appraisal methods available, not all which are applicable here. These most
important ones for the purpose of this manual are”

Graphic rating scales: Employees are rated according to the extent that they measure up to
pre-determined work standards or required attributes.

Critical incidents: These methods use specific examples of job behaviours that have been
collected from employees and or supervisors. Normally, a list is compiled of actual job
experiences relating to usually good or unacceptable employee behaviour.




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MBO (Management by Objectives): This is one of the most widely used performance
appraisal methods. It involves goal setting – the employee and his manager mutually set goals.
The employee is then at a later stage appraised on the extent to which set goals were achieved.
The main advantage of this method is employee participation in goal setting goal and in the
determination of expected standards. However, some of the disadvantages are that goals are
sometimes set too high (this results in employees becoming despondent), the strive for goals
sometimes occur at all costs, and not all jobs’ contents can necessarily be expressed in terms of
specific goals.

Performance appraisal will always be a somewhat traumatic experience for employees, no matter
what method is used. Furthermore, ratings will always be subjective, because people are rating
people. The fact is that all methods have flaws. Research has indicated that there is not one
single method that produces results that are significantly better or more valid than other
methods.

Types of Appraisals

Modern organisations currently depend on the 360 degrees performance appraisal. This involves
an employee being assessed not only his/her immediate supervisor but other stakeholders like:

•   Peers / colleagues
•   Customers
•   Suppliers
•   Subordinates
•   Government agencies
•   NGOs with similar objectives
•   Donors

The most important element with 360 degree appraisal is that it facilitates quick feedback and
eliminates bias element. It’s more objective than traditional approach and demonstrates best
human resources practices.

Show participants the attached sample Performance Appraisal format, as well as any other good
samples that are available.




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                              Sample Performance Appraisal


Employee Name:

Reviewer Name:

Date of Review:

The following questions are intended to guide the employee and reviewer in appraising the
employee’s performance during the past year. Some questions are to be answered by the
reviewer, and some by both the reviewer and the employee. Please use specific examples where
appropriate and possible.


I. Past Performance (to be completed by both reviewer and employee)

A. What are the primary work activities that were undertaken by the employee since the last
   review period?


B. What strengths did the employee demonstrate in completing the above work activities?


C. How can the employee improve his/her work performance?




II. Future Activities and Expectations

A. What can the employee do that would help the organisation operate more effectively? (To be
   completed by reviewer and employee)


B. What can the rest of the organisation do that would help everyone do a better job? (To be
   completed by reviewer and employee)


C. What are your goals for the next year, and how do you see yourself growing and
   developing professionally? (to be completed by employee)




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III. Review Results


Reviewer’s Comments:


Employee’s Comments:


Specific plans/actions until next review period:



__________________________________                 ______________________________
Reviewer’s Signature                               Employee’s Signature




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Rater training and common rater errors

It is important to subject those employees that will be involved in appraisal to rater training.
Carrell et al. [1997:p.294] suggest that rate training should include the following themes:

•   the objectives of performance appraisal
•   how to avoid typical rater errors
•   how to conduct non-discriminatory appraisals
•   the ethics of appraisals
•   How to conduct effective appraisal interviews.

Typical rate errors are:

1. Supervisory bias, where the supervisor has an inherent bias towards people in terms of their
   (the ratees’) age, gender, race, seniority, qualifications, liaisons in the organisation, or other
   non job-related characteristics. Some raters are may also be influenced by the “similar-to-
   me”-effect, and give higher ratings to employees with whom they have a lot in common.
2. The halo effect, where a particular quality of the employee (positive or negative) is
   appreciated (or disliked) so strongly, that it contaminates the ratings on other dimensions
   during appraisal.
3. Central tendency, where the rater tends to give average scores to all or some of his rates
   (i.e. to consistently award scores of 3 and 4 on a 6-point scale), probably because they find it
   difficult to evaluate some employees higher or lower than others, or they may have a lack of
   familiarity with the job’s contents.
4. Leniency or strictness, where the rater consistently gives too high or too low evaluations.
5. Regency, where raters are influenced by critical incidents of a positive or negative nature
   that occurred fairly recently, i.e. without taking critical incidents into account that occurred
   during the whole period since the previous formal performance review.

Ask:

?       How do you feel about giving negative feedback to employees? What method of
        discussion do you prefer and why?

The appraisal interview

Proper performance management and just purely good management will always mean that good
managers give regular informal feedback to their subordinates. If however the performance
management system requires formal appraisal interviews and feedback at specific intervals for
specific purposes, there are a number of guidelines that could be useful for raters:




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The feedback interview process:

•   Conduct the interview professionally, that is no interruptions, comfortable setting, etc
•   Prepare properly for the interview: make sure you know how to approach the discussion about
    the rate’s performance
•   Explain the method used (if this had not been done yet)
•   Discuss the employees performance on each dimension/objective in turn, highlight positive
    performance indicators as well as areas where performance was inadequate
•   Use a dialogue process to determine areas for development (identify training needs)
•   Emphasises that it is the employee’s responsibility to improve where necessary offer your
    assistance, and that of the organisation, to help the employee improve his performance and skills
•   Assist the employee in designing a personal development plan
•   Discuss performance standards/objectives to be assessed at the next performance review process.


The process of performance management

Initiation

Performance management starts at the top level in an organisation with definitions of mission,
strategy and objectives. These lead to more detailed definitions of functional or departmental
missions, plans and objectives.

Performance agreements

Performance agreements are then made between individuals and their managers, which set out:
• The key result areas of the job
• The objectives and standards of performance associated with these key result areas
• Work and personal development plans
• The skills and competencies required to fulfil job requirements

Continuous review

The performance of individuals and their development is reviewed continuously as part of the
normal process of management.
Effective performance is reinforced with praise, recognition and the opportunity to take on more
responsible work.

Formal performance review

There is a periodic formal review which, in effect, is a stocktaking exercise but its emphasis is on
looking forward to the next period and redefining the performance agreement rather than raking
over past events.




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Performance management skills

Giving feedback

    1.    Build feedback into the job
    2.    Provide feedback on actual events
    3.    Describe, don’t judge
    4.    Refer to specific behaviour
    5.    Ask questions
    6.    Select key issues
    7.    Focus
    8.    Provide positive feedback

Conducting performance reviews
   1. Be prepared
   2. Create the right atmosphere
   3. Work to a clear structure
   4. Use praise
   5. Let individuals do most of the talking
   6. Invite self-appraisal

This is to see the situation from the individual’s point of view and to provide a basis for
discussion-many people underestimate themselves. Ask questions such as:

         • How do you feel you have done?
         • What do you feel are your strengths?
         • What do you like most/least about your job?
         • Why do you think that project went well?
         • Why do you think you didn’t meet that target?

    7.    Discuss performance not personality
    8.    Encourage analysis of performance
    9.    Don’t deliver unexpected criticisms
    10.   Agree measurable objectives and a plan of action

How to manage under-performers

    1.    Identify and agree on the problem
    2.    Establish the reason(s) for the shortfall
    3.    Decide and agree on the action required
    4.    Resource the action
    5.    Monitor and provide feedback




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Group work:

Ask participants to work in small groups. Assign each group one of the major headings below.
They have 10 minutes to brainstorm for best practices in human resource management for their
given topic.

Bring groups back together and ask them to report back. Compare responses to the following
summary.




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  BEST PRACTICES IN HUMAN RESOURCES MANAGEMENT THAT CREATE
                      SATISFACTION AT WORK


STAFF GUIDES and MANUALS
    • HR Manual explains work process, performance expectations+ measures+
       regulations
    • Manual exists in either electronic or hard copy
    • Manual was updated within the last 12 months
    • Each department has their own copy of the HR manual
    • Departmental heads use the manual (want examples)
    • The manual is clearly written and comprehensive
      •   The manual is understood by non HR people at all levels

ROLES AND RESPONSIBILITIES
    • An employee manual exists in electronic or Hard Copy
    • All employees have a copy of this manual
    • Job descriptions for each role are written
    • Job description for each role are communicated
    • Each member of staff has annual objectives
    • There is an impartial grading evaluation system in place

BENEFITS AND REMUNERATION
   • Staff are only paid according to grade, function and responsibilities
   • Every three years an external pay evaluation takes place
   • All staff salaries are reviewed on an annual basis
   • All staff are offered pension plan
   • All staff are offered a medical service or cash in lieu
   • All staff are offered funeral/death benefits for immediate family
   • All staff are offered housing or cash in lieu of
   • All staff are offered transport or cash in lieu of
   • All staff are entitled to annual leave




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INDUCTION PROCESS

      •    All employees receive and sign letter of appointment
      •    All employees receive and sign employment conditions
      •    All employees receive a copy of their job description and objectives within one
           week of starting employment
      •    Working conditions orientation is in place
      •    Induction process in place


APPRAISAL SYSTEM

      •    Appraisal process in place
      •    All staff receive an appraisal minimum every 12 months
      •    The results of each appraisal recorded
      •    The appraisal is linked to individual training and development
      •    Personal objectives set and agreed at the appraisal
      •    Individual person objectives are reviewed each quarter


TRAINING AND DEVELOPMENT

      • A training plan incorporates training for all staff member
      • The training plan is monitored, reviewed and updated.
      • Every employee receives annual training.
      • Managers receive basic management training:
            •    How to deliver appraisal
            •    How to communicate
            •    How to run a team


WORKING CONDITIONS

      • Environment appropriate for staff to do their jobs
      • Environment clean, hygienic and well kept canteen available
      • Canteen kept clean and hygienic




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10 Compensation
Time:             1 hour

Resources:        Flip Chart/Board, Markers/Chalk, Masking Tape, Handout

Methods:          Brain Storming, Question and Answer, Group Discussion

Objectives:       By the end of the session the participants should be able to:
                          Define the term the compensation management
                          Identify the importance of the compensation management in the organisation
                          Describe the various systems and procedures used by the organisation in
                                  motivating staff and improve staff performance




Ask participants:

?       What is Compensation Management?

Write the responses on flipchart and relate this to compensation Management.

Compensation management is the process an organisation uses to compensate its employees in
monetary and non-monetary ways to the mutual satisfaction of the organisation and the
employee.

Although the term compensation is often interchangeably with wage and salary administration,
or remuneration, the term compensation is actually a broader concept. As can be seen from the
definition, monetary and non-monetary ways to reward employees have to be considered, to
provide incentives for them to work harder and smarter, and to help them to acquire their
desired standard of living. Furthermore, one should understand that compensation refers not
only to extrinsic rewards such as salary and benefits, but also to intrinsic rewards, such as
recognition, the chance for promotion and more changing jobs.

People have intrinsic needs (e.g. the need to know that I’m OK) and they have extrinsic needs
(e.g. the need to pay for food, housing and education) and to satisfy these needs they want
intrinsic rewards (e.g. the opportunity to learn a new skill) and extrinsic rewards (e.g. money).
The organisation responds by providing compensation which includes monetary (e.g. a
performance bonus) and non monetary rewards (e.g. redesigning the job to make it more
interesting).

Employees’ need for income and their desire to be fairly treated by the organisation make
compensation management all the more important for the organisation. Yet there is no exact,
objective method of determining compensation for any one job or employee. That is, there is
always a compromise or trade-off at stake: one cannot satisfy all the employees all the time. As
such, compensating employees for what they give the organisation is as much an art as it is a
science.


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    AIM Organisational Development Programme                        Human Resource Management



The importance of compensation


?       Why has compensation become such an important and controversial topic in recent
        times in Uganda?

Until quite recently compensation was a fairly straightforward issue for HR practitioners. The
reason for this was that most medium to large organisations had clear-cut salary structures,
systems and policies. It was therefore accepted practice to have rigid salary scales, annual
bonuses, pension fund contribution etc. across the board percentage based general salary
increases, as well as percentage based salary increases for exceptional performance, were the rule
rather than the exception.

Traditionally pay differentials were often based upon issues other than performance, experience,
and proven proficiency. As such seniority, gender, race, age, etc. were often seen to be important
criteria when making compensation related decisions. Also, worked or to what extent they added
value to the organisation. However, during the past few years’ compensation management took
on a whole different format. This was largely due to the following:

•   Money as a motivator: more information on the role of money as a motivational factor became
    available through research
•   Flexible organisations: There is a move away from large bureaucratic organisations to more
    flexible organisations, both in terms of structure and processes.
•   Pressure from stakeholders: The number of stakeholders increased and they became more
    assertive (e.g. the trade unions)
•   Inflation: Continuous across-the board-percentage increases made it very difficult for
    organisations to keep up with upward spiralling compensation costs.
•   High taxes: Increasing taxes for salary earners forced organisations to make provision for more
    tax friendly salary packages
•   Pay for performance: Organisations realised that there was no point in paying employees just
    for being members of the organisation, at least a part of the compensation packages had to be
    performance-based
•   Compensation strategy as an important component of company strategy: Compensation
    strategy was increasingly seen to be an integral part of company goals and strategies

Besides the points mentioned above, it should be clearly understood that there are a number of
stakeholders that have a variety of expectations and needs, and therefore a spectrum of demands,
as far as compensation is concerned. These stakeholders include:
• The organisation
• The employees
• The government (in terms of legislation, e.g. the Labour Relations Act)

For organisations it is often a gruelling task to simultaneously satisfy all the stakeholders’
expectations. A skilful balancing act has to be performed and compromises reached. When an
organisation fails to balance expectations, the end-result could be financial disaster for the
organisation and job loss for many.



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   AIM Organisational Development Programme                          Human Resource Management

Depending on the type of organisation, the industry in which it operates the type of products or
services it provides, and whether it is capital or Labour intensive, the annual total salary bill could
be as high as 70% of total expenditure. The average figure is approximately 55%. The
consequences of inappropriate compensation strategies, or even a minor calculation error during
salary adjustments, could of course be disastrous for this organisation! Imagine what the
difference for an organisation could be between, for instance, a 9% and a 10% salary increase?

The goals of compensation

The four main objectives of any organisational compensation system are the following:
• Attracting good employees
• Retaining good employees
• Motivation
• Satisfying external requirements


Attracting good employees: Group Work

Write this question on a flipchart and ask participants to answer in groups. They have 10
minutes to brainstorm. Then have the groups report back, taking one response from each group
and circulating through each group until no new answers are generated.

        •   How can an organisation ensure that they attract the best people?


Compare responses to the following information:

Although most job applicants are not aware of the exact salaries or wages offered by different
organisations for similar jobs within the Labour market, they do compare job offers and pay
scales. Job applicants who receive more than one offer will naturally compare the offers in terms
of what his take-home pay will be. To attract good employees organisations therefore have to
offer competitive salaries, i.e. salaries that are market related. Organisations normally make use
of wage surveys to establish what market-related salaries for their particular industry are.

A strategy pay decision by the employer is choosing a general pay level for the organisation. In
comparison to other employers within the same industry and Labour market, management must
decide whether to be a high pay level employer, a low pay level employer or a competitive pay
level employer.

A high pay level strategy may be chosen when management believes that if it maintains high
salaries, the organisation will attract and retain the best employees within the geographic area,
industry or sector. Sometimes management will expect more from employees because the
organisation pays higher than average salaries. It may also happen that employees working for
such an organisation may become very frustrated and unproductive when they are unhappy in
the organisation, but can’t afford to leave since their organisation pays the best salaries. This is
known as the “golden handcuffs”

A low pay level strategy may be chosen because management decides to expect and live with the
increased Labour turnover and morale problems that may result. The savings in total personnel
costs may be estimated to outweigh the disadvantages associated with low morale and high turn


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    AIM Organisational Development Programme                         Human Resource Management

over. Employers may choose this strategy simply because the organisation cannot afford to pay
more. Small employers, those operating in highly competitive markets, and those that are in a
Labour intensive industry where there is also a good supply of Labour, are likely to choose this
pay level option

 A competitive pay level strategy may be decided upon when management believes that if the
organisation’s pay level is competitive within the Labour market, the employee problems
associated with the low pay level strategy can be largely avoided. Most employers will try to
remain competitive within the local Labour market by offering salaries that are similar to those
offered by competing employers.

OTHER ISSUES TO ADDRESS IN REGARD TO COMPENSATION:

•   How can an NGO find out about prevailing wages in their field, so as to create a competitive
    salary scale?
•   What are some non-financial forms of compensation that an NGO can offer that may encourage
    an employee to accept the post despite a low salary? (For example, certain kinds of benefits; good
    work environment; recognition.)




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    AIM Organisational Development Programme                      Human Resource Management


11 Action Plans

Time:             30 minutes

Resources:        Flip Chart, Markers, Action Plan Handout

Methods:          Exercise, Discussion

Objectives:       By the end of the session, participants will be able to:
                          Write an Action Plan for implementing human resource management



Distribute Action Plan handout. Introduce the purpose of the AIM Action Plan.

Since many participants are now familiar with the Action Plan format from previous workshops,
ask for a volunteer to explain it for the benefit of those participants who are new.

The Action Plan is intended to help AIM’s partner organisations apply what they have learned in
this workshop to their own organisations. Workshop participants from each organisation will
draft an Action Plan during this session. AIM will receive a copy. The workshop participants
will share the Plan with colleagues at their organisations. They will begin implementing the plan.
The Plan will help the organisation, the workshop trainer and AIM to track progress on
implementing what they have learned in the workshop. When the trainer visits the NGO for
the Consultancy Clinic, he/she will discuss their progress on the Plan.

Ask:

?       Why is it helpful to make an Action Plan?

Action planning is important for the following reasons:
   • It breaks down a large, complex and potentially overwhelming objective such as developing a
       strategic plan into manageable, concrete activities;
   • It helps them think about what can be realistically achieved with their resources and staff;
   • It helps them decide what additional resources are needed;
   • It sets specific responsibilities and deadlines.

Ask participants to work with a colleague from their organisation to complete the plan. Give
them about 20 minutes, as time allows. If plans are complete at the end of the session, take
them up to make photocopies for AIM, then return them to the NGOs before they leave.

To conclude, ask for a volunteer to name one objective they have included on their plan. Ask in
general what this planning process was like for them.




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   AIM Organisational Development Programme           Human Resource Management


     Action Plan for Human Resource Management

Name of Organisation: _____________________________________________

 Activity                          Who         When         Resources
                                                            Needed




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Evaluation and Close

Time:             30 min

Resources:        Flip Chart, Markers, Post-Training Self-Assessment, Workshop Evaluation,
                  Certificates of Participation



Distribute the Post-Training Self-Assessment form and the Workshop Evaluation form.

Remind participants that this is the same Self-Assessment that they filled out at the beginning of
the workshop. Ask them to fill it out again so that they can reflect on what topics they have
learned about, and what topics still need more time. If desired, you may give the participants
back their original Pre-Training Self-Assessments so that they can compare their results.

Ask participants to fill out both forms. Give them about 15 minutes.

When participants are finished, ask for someone to share an area in which they have increased
their understanding. Ask what helped them to learn these new knowledge/skills.

Then ask if there are topics about which participants did not increase their understanding. Ask
what more is needed to help them master these topics.

Collect the self-assessment and evaluation form.

An AIM representative should close the workshop by giving out certificates and thanking the
trainer.




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