Fist you have to ask yourself what does HR do?  HR’s function is to support hiring and termination, training and development, benefit programs, HR compliance-safety and their own improvement projects.  There are five topics to discuss.

Next you have to develop a Lean Daily Management System.  I believe you need daily ten minute meetings to maintain the discipline of lean.  Daily meetings are the cornerstone of a Lean Daily Management System.  That does not mean you need to talk about the same things every day.  If your transaction volume is low then focus on different areas each day.

Your lean system should be focused around a visual management board.  The daily discussion should be about the data collected, the trend charts that you are updating, any noconformances that are occurring, and what your HR progress is towards your HR objectives.  Of course this implies you have sat down and developed your objectives and understand what the purpose of HR is in your organization.

Some believe that HR has nothing to talk about daily.  But wait; if HR has nothing to talk about daily then what exactly do they do every day?  I suspect they are thinking about the big HR picture.  They need to break it down into smaller elements that can be charted and tracked daily.  Keep in mind, if your company is big enough to have an HR department, then it is big enough to have something to talk about daily.

For example, if you are hiring one person a month then you must have a process that requires oversight, has defects, and also has opportunities for improvement.  Yes, HR has daily things to talk about…

Questions to ask in your daily ten minute lean meetings are:

• What is employee turnover, what’s the goal?
• What is the competency level for each employee, what’s the goal?
• How many people are using benefit programs, what is the goal?
• How many compliance/safety nonconformance, what’s the goal?
• How many kaizens, what’s the goal?
• Overall, what are the results of the HR department services?

Yes, you can implement lean in HR.  You can implement lean anywhere.  The issue is having goals and then collecting the right data to lead the discussion to motivate everyone to get lean.

Complying with the law on employment related issues is a dynamic management task.  Federal legislation is written, followed by state and local legislative laws or acts, which lay out guidelines and enforcement action.  These laws and acts can become obsolete and require modification due to the changing nature of our workforce.

Thirty years ago, the workforce was more homogenous that it is today.  First, as an example of evolutionary laws, there was non-discrimination employment law/legislation to protect race.  Since then the law has been expanded to incorporate, age, female employees, homosexual employees, etc. just to name a few.  And, as the demographics of the potential hiring pool changes and norms in society change, we can look forward to additional new labor laws and legislation to protect employees and companies alike.

To facilitate our discussion we will present Federal Labor Laws that must be complied with in the small to mid-size business.  Following this paragraph is a chart of Federal Labor Laws and a list of required records/reports.  Every individual company is responsible to know the laws and to what extent any law might apply to them for their operation.

Federal Labor Laws

The following chart lists United States Federal labor laws that apply from the smallest group of employees to larger organizations.  Most of the laws listed apply to all companies.  Additional compliance is required at 15, 20, 50, and 100 employees and for companies servicing Federal contracts.  The alphabetical listing itself has no bearing as to the frequency of use or importance of the law.

Posting Requirements

Federal laws require that employers post certain notices in the workplace where all employees can view them.  If a company has more than fifty (50) employees, the employer must post information concerning:

• The Americans with Disabilities Act of 1990 (ADA);
• The Age Discrimination in Employment Act of 1967;
• Title VII of the Civil Rights Act of 1964;
• The Employee Polygraph Protection Act;
• The Fair Labor Standards Act (Current Minimum Wage);
• Family Medical Leave Act (FMLA) of 1993; and
  • Occupational Safety & Health Act(OSHA) of 1970.

A company with fewer than fifty (50) employees is not required to comply with FMLA and, therefore, need not post related information.

The Equal Employment Opportunity Commission (EEOC) can provide posters containing the above listed information, at http://www.eeoc.gov. In addition, the U.S. Department of Labor (DoL) makes many Federal labor posters available at http://www.dol.gov/compliance/topics/posters.htm. State labor law posting requirements may vary; see the particular state’s Labor department for more information.

Legislation Briefs

The following provides a brief description of some of the various acts relating to HR.  A more complete discussion of Federal compliance is included in the “Managers Manual”, found under the “300 Managers Manual” tab.

Clayton Anti‑Trust Act (1914)

Narrowed the availability of injunctions against labor organizations in cases involving employer and employees. Allowed injunctions only if it is necessary to prevent irreparable harm to property and no adequate legal remedy exist.

Norris‑LaGuardia Act (1931)

First general legislation specifically designed to strengthen unions in dealing with management. Prohibited “yellow day” contracts (agreements required by employers of prospective employees, by which the employee agreed not to join a labor union).

National Labor Relations Act (Wagner Act) (1935)

Congressional effort to equalize the disparity in bargaining power between employers and employees; gives covered employees the right to organize and bargain collectively.  Created the National Labor Relations Board (NLRB).

Fair Labor Standards Act (1938)

Known as the Wage and Hour Law. Regulates hours and wages of employees. FLSA prohibits oppressive child labor. Payment of overtime after 40 hours worked in one workweek and minimum wage is included under this law.

Executive Order 8802 (F.D. Roosevelt, 1941)

First federal action to deal with persistent and pervasive discrimination in employment against minorities and women. Defense contractors were forbidden to discriminate in employment on basis of race, creed, color, or national origin. Lacked Congressional support and was not vigorously enforced.

Taft‑Hartley Act (Labor Management Relations Act 1947)

Amended National Labor Relations Act. Covers all employees whose business affects interstate commerce.

Labor Management Reporting and Disclosure Act (Landrum‑Griffin Act (1959)

Further amended the NLRA; established a “bill of rights” for union members and required reports from union to the Secretary of Labor.

Executive Order 10925 (Kennedy, 1961)

Required all agencies of the federal government to include a nondiscrimination clause in their contracts.

Equal Pay Act (1963)

Requires that women be paid the same rates as men for equal work on jobs where the performance requires equal skill, effort and has the same level of responsibility.

Title VII of the Civil Rights Act of 1964

Prohibits employment discrimination based on race, color, religion, national origin, or sex. Employers with 15 or more employees are covered. Provisions enforced through the Equal Employment Opportunity Commission (EEOC).

Executive Order 11246 (L.B. Johnson, 1965)

Requires government contractors take affirmative action to insure that employees are hired and promoted on a non‑discriminatory basis.

Age Discrimination in Employment Act of 1967

Prohibits covered employers from refusing to hire, discharging or otherwise discriminating against persons 40 through 70 years of age. Since amended to include all persons over age 40 with no age ceiling.

Occupational Safety and Health Act (1968)

Imposes a general duty on employers to provide a place of employment free from recognized hazards (physical, chemical, biological, etc.) that may cause death or serious physical harm.

Amendments to Title VII of Civil Rights Act (1972)

Prohibits discrimination in employment of basis or sex, as well as, discrimination on the basis of race, religion, color, or national origin. Applies to all employers whose activities affect interstate commerce and who employ 25 people or more.

Rehabilitation Act of 1973

Requires employers with federal contract exceeding $2500 to take affirmative action to employ and advance in employment qualified handicapped individuals. Employers having federal contracts over $50,000 must develop and maintain written affirmative action programs.

Vietnam Era Veterans Readjustments Act (1974)

Requires federal contractors to promote employment opportunities for qualified disabled veterans and veterans of the Vietnam era.

Privacy Act of 1974

Protects individuals against the unauthorized disclosure of personally identifiable information by any agency of the federal government.

Employee Retirement Income Security Act of 1974 (ERISA)

Covers employee welfare plans providing medical, sickness, death, vacation and other fringe benefits that may include pension and other welfare plans. Does not require employers to establish or fund benefit plans. Established standards that existing and new plans must meet.

Immigration Reform and Control Act of 1986

Established opportunity for the naturalization of specified groups of aliens already living/working in the United States. Placed responsibility on employer to document and provide proof of employees’ right to work.

Federal Employee Polygraph Protection Act of 1988

Prohibits employer’s use of polygraph as pre‑employment screening tool. Limited use for banking in some cases of security violations after employment status is achieved.

Drug‑Free Workplace Act of 1988

Requires Federal contractors and grantees to maintain a drug‑free workplace.

Americans With Disabilities Act of 1990 (ADA)

Establishes protection of employment for disabled workers. Took effect for employers with 25 or more workers on July 26, 1992, and employers with 15 or more workers on July 26, 1994.

Family and Medical Leave Act of 1993 (FMLA)

Guarantees workers up to 12 weeks a year off, unpaid, for births, adoptions or the care of sick children, spouses, or parents.

And Elsewhere…

Council Directive 2000/78/EC

The subtitle of this legislation is “establishing a general framework for equal treatment in employment and occupation”. The Member States of the European Union (EU) ban discrimination in the field of employment and occupation. However, the scope of this prohibition, its content, and its enforceability vary from country to country; hence, this Directive is designed to lay down a general minimum framework for anti-discrimination.

* * * * * * *

We’ve just scratched the surface of employment legislation and compliance. There are many, many more laws around the globe that we haven’t discussed. Obviously, complying with labor laws and employment-related issues is a dynamic and multifaceted management task — a task made considerably easier by the Bizmanualz Human Resources Policies, Procedures, and Forms manual.

[2] HIPAA applies only to companies providing employees with health care benefits (e.g., insurance).

[3] Companies with 11-14 employees must maintain a record of illnesses and job related injuries under OSHA.

The dynamics of employee recruiting and retention are getting more and more complex.  The 21st century has introduced an array of new HR-related issues, such as:

• Family/medical leave;
• Telecommuting;
• Flexible work schedules;
• Global cultural workplaces; and
• A workforce that may not have the skills to meet forecasted hiring requirements for future job openings.

As baby boomers leave the workplace, the number of available workers to fill the projected demand is not expected to keep up.  How does a company’s Human Resources department plan for such a contingency?  Senior management must recognize that circumstances like these could prevent the company from accomplishing its goals.  The answer is to ensure that Human Resource Management is a key ingredient in strategic planning and the future success of the business.

Employee Recruitment and Hiring

The employee hiring process is generally initiated once you’ve identified a need to bring on one or more additional employees to fulfill certain requirements of your business plan. It officially starts when you fill out a new employee requisition, including required experience, skills, and qualifications, and ends with the candidate selection and offer, followed by orientation and reporting to work.

After the employee requisition, your staff prepares an appropriate advertisement to solicit qualified candidates.  The advertisement should make your requirements clear (e.g., all applicants must complete an application form) and should include such information as:

• Job title;
• Job qualifications;
• A description of duties; and
• Salary or pay rate.

The application form cannot ask the applicant to divulge any information that could be used to unfairly discriminate (questions of race, religion, etc.).  All language in the advertisement should be specifically job-related.  A “final date for accepting applications” may be indicated to ensure the company meets its own requirements, as well as to limit the number of applicants, so long as that date is conspicuous.

The advertisement may be posted in state employment offices, as well as in newspapers, radio, television, trade journals, announcements on yours and other websites. Some companies’ recruitment processes include job fairs and/or using a recruiting service. A statement that you are an “Equal Opportunity Employer” is required of job postings in the USA, the EU, and other areas of the world.

Depending on your location(s), you may have to comply with regulations pertaining to recruiting, selection, and hiring of employees.  Examples of laws affecting hiring include the:

• Age Discrimination in Employment Act (USA);
• Americans with Disabilities Act (ADA, USA);
• Various Civil Rights Acts (USA);
• Racial Equality Directive (EU); and
• Employment Framework Directive (EU).

Interviewing Applicants

Once you’ve identified qualified candidates, you should invite them in for an interview.  The interview is an opportunity to:

• Meet the applicant;
• Exchange information;
• Ask additional, or more in-depth, qualifying questions;
• Allow the individual to ask their own qualifying questions (about the company, the job opening, etc.)

The interview is for assessing the applicant — and vice versa — and discussing both parties’ needs in detail.

The interviewer must be careful not to ask questions that are considered confidential, discriminatory, illegal, or not job-related. Certain questions (about citizenship status, age, national origin, children, transportation, height, weight, disabilities, marital status, religion, military service, or housing) are off-limits, according to various privacy and rights laws. A sample (i.e., not an all-inclusive) list of questions one may “ask”/“not ask” an interviewee is included in the Bizmanualz^TM Human Resources Policies, Procedures, and Forms manual. In any case, open-ended questions are the best, in that they allow the applicant to provide answers voluntarily.

An interviewer needs good interpersonal skills and should always keep thorough recorded (written) notes of the interview.  A thorough interview record not only helps the applicant screening process — it can help defend the company if someone who’s not hired decides to take action against the firm on the basis of discrimination.

Title VII of the Civil Rights Act of 1964 and other local and state laws prohibit the interviewer from asking questions that could be used to discriminate against an applicant on the basis of race, gender, or other issues. Make sure applicants know if there are additional applicants to interview and that a hiring decision will be made by an approximate date.

Background Checks

Background checks should be performed on applicants who’ve succeeded at the interview phase of the hiring process. By the end of the interview, the applicant should be asked to read and sign a form authorizing your organization to conduct a background check, including a criminal check and a check of past employers.  This form should include a statement (“waiver”) that both you and the prior employer are released from financial liability from any suit that may arise from obtaining or releasing background data as long as the data provided are accurate.

Remember — if you hire an employee without performing an adequate background check and he/she later endangers other employees or customers, you may be held criminally or civilly liable.  Look for gaps in employment, verify addresses, confirm qualifications and education, talk to past employers, and verify professional references. Once again, keep careful, thorough documentation of all background checks.

A credit check — which has become more popular in recent years, regardless of the type of job offered — cannot be performed unless the applicant has approved it in writing, thereby releasing you from liability.  A credit check should be performed only if an applicant’s financial condition is relevant to the job (e.g., bank teller, loan officer).

If employment is denied due to the results of a credit check, the applicant must be notified in writing of the company decision and must be given the name and address of the credit reporting organization that provided the decisive information. Many states have specific “employment credit check” regulations; check with your state’s labor department or division of employment security for more information.

Federal and state anti-discrimination laws place legal limits on a company’s ability to obtain arrest and/or conviction records.  A criminal background check should only include convictions. Furthermore, only a record of conviction can be the basis for rejection, and then only if business necessity requires it (for example, a bank may reasonably refuse to hire someone convicted of embezzlement for a teller or teller supervisor position).

Again, many state laws are more restrictive than their federal counterparts; this should always be considered when a criminal check is required.  Some states require an employer to conduct criminal record checks of applicants for jobs that involve working with minors (e.g., day care, teaching, coaching) or in health care; always check with your state for guidance on criminal record checks.

Discriminatory Restrictions (Federal & State)

Companies that have fifteen or more employees are subject to federal anti-discrimination practices covering recruiting, application and hiring processes.  States have more laws that are restrictive and generally affect even the smallest companies as to anti-discrimination.  A company cannot discriminate in hiring based on sex, race, color, national origin, citizenship, disability (physical or mental), religious affiliation, military service, pregnancy, personal bankruptcy, refusal to take a polygraph test, or age.

Selection (New Hire Employee)

The successful applicant should be processed into the organization in an orderly manner beginning with a company orientation, a review of the company policies concerning employee’s, a tour of the job site, a safety brief concerning the job, introductions to associated supervisory personnel and co-workers, and processing into the payroll system.

GENERAL EMPLOYMENT ISSUES

The new hire is sometimes asked to sign an “at-will” employment statement, which means there is no contract binding either party to the other (unionized employees being an obvious exception). In other words, the employer or the employee may terminate the work relationship at any time without cause.

You may hire applicants who are not U.S. citizens.  However, once a non-citizen is offered a job he/she must have an “Alien Registration Receipt Card” (USCIS Form I-551, commonly known as a “green card”) or an appropriate “work visa”, which shows that the individual has the right to work within the United States.

Also in the USA…within three (3) days of employment, every new hire must fill out a “Form I-9” and supply identification and proof-of-eligibility documents listed on the I-9. This is required of all firms, in accordance with the Immigration Reform and Control Act (IRCA). Note that I-9 forms must be kept separate from personnel files.

Minors (those under 18 years old) may be hired, except where certain work hazards (e.g., working with explosives, in a sawmill) are a normal part of the environment, where minors are prohibited in accordance with the U.S. Fair Labor Standards Act.

Minors that are 14 or 15 years old may work only during certain hours after school (e.g., not after 10 p.m.), not more than three hours a day, and no more than 18 hours a week; check your state and local labor statutes for specifics.

Employee Relations / Retention

The most important elements in employee relations are:

• Ensuring that employees are paid a fair wage for their efforts, combined with a benefits package that compares favorably with standards for businesses similar to yours;
• Respect is important to employees — they need to know their efforts are appreciated;
• Respect for their management team; and
• Having a sense that they will be individually and collectively treated in a fair, lawful manner.

The company can communicate employee appreciation through performance appraisals, or performance reviews.  Employees want the opportunity to hear how they are doing in comparison to what you expect from them and how they might compare to other workers in similar functions.  Developing individual and group performance standards is an essential ingredient in employee relations and retention.

Performance standards should be clear, concise, consistent, and in writing.  Effective performance appraisals are objective, assesses employee potential, identify opportunities for improvement, allow for compensation review, and can be used to identify training needs.  They can be a powerful motivator for the employee, if used correctly.

The employer needs to decide on how they will administer base pay and incentive or bonus programs, as well as when pay and performance will be reviewed with the employee.  Most compensation packages (in small to mid-size companies) include Salary + Incentives + Benefits.  A reasonable and common relationship is Salary (65%) + Incentive (5-8%) + Benefits (27-30%).

The compensation function falls under wage and salary administration.  This includes establishing pay rates and grades, establishing job classifications for pay, compliance with state & federal minimum wage laws and annual reviews of your company’s position with regard to pay and benefits as compared with national and local businesses similar in nature.  Market salary surveys can be purchased and will provide valuable comparative information on a local, regional, national, and line-of-business basis.

Another key employee relations ingredient is deciding which benefits to provide.  Legally required benefits include:

• Social Security;
• Medicare;
• Unemployment insurance;
• Workers’ Compensation (insurance for work-related injury);
• Federal and/or state leave laws (e.g., FMLA); and
• Continuation of group health insurance coverage after termination (e.g., COBRA).

Insurance programs are normally offered to employees (and are sometimes mandated by law).  Most plans for employee insurance benefits include medical, hospitalization, vision, dental and life insurance.  The company, the employee, or a shared form of contribution by both the employee and company may pay for the insurance program.

Other benefits may be included, though they are not required by law, as additional incentives. (Generally, if such benefits are offered to one employee, they must be made available to all employees, in accordance with anti-discrimination law.) These benefits include:

• Retirement and pension benefit plans (e.g., 401K);
• Employee stock ownership plans (ESOP);
• Defined benefit plans (a monthly pension payment upon retirement); and
• Defined contribution plans (money periodically deposited by the company into an employee’s individual retirement account).

Other benefits include payment for time not worked (e.g., vacation, sick leave, long-term disability (LTD), holidays, bereavement). It is important to note that employers are not required to give any Federal or state holiday as a day off, with or without pay. However, all employers are required to excuse employees for military leave and jury duty (and in some states, time off to vote); review your state laws for exceptions.

Companies with generous benefit plans might also include legal insurance, tuition reimbursement, payment toward credit counseling or psychological counseling, and reimbursement for parking and transportation.

Benefits are very important to the employee.  Your benefits program sends a direct message to your employee community — it tells them how much you value them.  It tells them if you think of them as assets or liabilities.

All of these issues are covered in the Human Resources Policies, Procedures, and Forms manual from Bizmanualz. It provides a great start for any growing company.  It’s well researched, covers the core human resource management issues, provides guidance and sample forms, and even includes a sample Employee Handbook.  Check it out and let me know what you think.

The development of HR policies and procedures, like those provided in products from Bizmanualz, enables the management team to operate HR in concert with other operations and make sure your strategic plans take flight.

Human Resource Organizational Activities

Your Human Resource Management consists of deliberate organizational activities designed to improve employee productivity and administration through such means as recruitment, compensation, performance, evaluation, training, record keeping, and compliance.

Most view the HR management function as having eight commonly accepted responsibilities:

1. Compensation and Benefits;
2. Employee and Labor Relations;
3. Employment Practices & Placement;
4. Workplace Diversity;
5. Health, Safety, and Security;
6. Human Resources Information Systems;
7. Human Resource Research; and
8. Training and Development.

The Society for Human Resource Management (SHRM) has concluded that most organizations should have one human resource staff person to every one hundred employees.  This is not to imply one manager per 100 employees, but a full time person performing functional duties is recommended.

Any small-to-midsize company would be advised to hire at least one Human Resource Manager who is a “generalist”, has excellent communication skills (both verbal and written), and is certified by the SHRM Certification Institute as a Senior Professional in Human Resources (SPHR) or Professional in Human Resources (PHR).

HR Management Within Small Businesses

As your small company grows, it will eventually recognize that it can no longer devote time to daily personnel administration and that the organization is ready to give this responsibility to an HR manager who is familiar with human resource management responsibilities and laws.

Organizations that employ from five to four hundred or more employees will have to deal with such core human resource management laws and issues as:

• Human Resource Strategic Planning;
• Recruitment, Orientation, and Retention/Employee Relations;
• Human Resource Administration and Record Keeping;
• Salary & Wage Administration;
• Benefit Administration;
• Employment Labor Law Compliance;
• Development of HR Policies & Procedures;
• Training Program Development and Administration for Employees; and
• Succession Planning for the Organization and Business Model.

Your Human Resource Management structure and or organization chart for companies ranging from twenty-five to two hundred fifty (25-250) employees will vary with dependence upon how important the role is to top management, the type of business, the types of jobs and skill levels of employees, and the projected growth plan for the company.

A very small company with rapid growth will find the HR challenge to recruit and manage employees is a full-time function for at least one person, and maybe more. An established mid-size company might employ three full time persons (one manager and two assistants) to handle the planning, administration and compliance issues dealing with their employees.

The Human Resources Policies, Procedures, and Forms manual provides a great start for any growing company.  It covers the core human resource management laws and issues, provides example forms, and a sample Employee Handbook.  Check it out — let me know what you think.

Additionally, the very nature of a business itself, relative to its size and mission, will dictate the level of Human Resource Management and the structure and application of HR Policies & Procedures.

One thing every business has in common?

The HR department!

It’s a fact that Human Resources, or “HR”, is the most important — and often the most expensive — department. They’re responsible for an enormous amount of records, and they have to know more than a little bit about labor law, organizational behavior, privacy regulations, communication, job satisfaction, and so on.

Yet, surveys of company managers continue to report that the most serious management problems are those related to people — “people problems”.  The application and construction of sound management practices — policies and procedures — toward human resource (personnel) management in the workplace can help resolve these people problems, many times before they begin.

Typically, a small business begins with a product and a plan.  Entrepreneurs often start businesses with themselves as the only employee. They give little thought to human resource management. Even the founder of a small startup business with several employees will generally employ those with whom they have close personal and professional ties.  Outside of payroll taxes, the small startup may face very few compliance issues.

The founder/owner/chief executive eventually busies herself (himself) with critical product issues (developing the product/service, marketing and selling it, collecting revenue, etc.) and has to assign human resource duties, management and clerical, to other personnel.  Department or unit managers may begin to recruit and manage their personnel independent of any organizational HR plan (i.e., without a plan or uniformity).  This is where most HR problems begin.

The business is liable for employee actions at work, for manager’s actions in an interview, for how all employees treat all other employees, for how employees are hired or terminated and a wide range of health, safety, security, privacy and what seems like an endless number of regulations. To a growing business, many of these laws might be considered burdensome, but they’re designed to ensure fair and equitable treatment of all personnel (especially where the HR function might be understaffed, considered an afterthought, or just plain nonexistent).

As the business expands and growth occurs, the requirement to take a professional interest in personnel and the function of “Human Resource Management” becomes more apparent.  A mid- size business will be required to recognize and implement a full time Human Resource Management function and plan for operations.

The Recent Past

Human resource or personnel management has been an ongoing effort, ever since we were required to rely on one another to accomplish goals — like survival — for the good of the group.  As we evolved into a society of workers gainfully employed for the conduct of business (aka, mercantilism), we began to rely on structured organizational methods of managing everyone’s’ efforts toward production in hopes of ensuring a profit.

Human Resource Management educators generally agree that personnel management, the predecessor to human resource management, came into being as a business function in the early 1900’s in Europe and the United States. HR resulted from the development of businesses that produced large amounts of products from a single location during the industrial revolution — mass production techniques.

Mass production required a coordinated effort from workers. Workers now had to be recruited, trained, paid, and managed for the production of products and services. Governments became involved in the regulation of labor and the implementation of taxes on labor which we now recognize as “Labor Laws” and taxes such as “Social Security & Medicare” and “Unemployment Insurance”.

The HR Present

As mentioned earlier, the small business owner generally managed all personnel functions and requirements by himself/herself , or with the assistance of a trusted personal secretary or office manager. Once the business began to grow, the secretary would begin to take on all the responsibility of maintaining the personnel management function, as this was largely a file and record-keeping job.

However, as a business grows, the personnel function generally outgrows the simplicity of record keeping and evolves into a more sophisticated management function, which we now refer to as Human Resource Management

The competitive nature of business today places a greater emphasis on being able to recruit, train, and retain workers who understand the mission of the business and can work closely with management toward profitable goals.  Additionally, along with productivity increases, employers are faced with many involved and potentially complicated labor laws, which protect the rights of applicants and workers alike.  In fact, the relationship of business management and the workforce currently requires more attention to human resource management.

In a small to mid-size business, all management personnel are answerable for some functional responsibility toward human resource management and organizational policies & procedures.  Written policies & procedures ensure continuity in management, especially where personnel are concerned.

Today’s small (10-50 persons) and midsize (50-400 persons) businesses require personnel administration and human resource management.  Personnel management is the essential ingredient or clerical function associated with compliance issues and recordkeeping.  Human Resource Management includes clerical & record keeping duties, plus dynamic issues such as recruitment, hiring, planning, salary administration, and training, in line with the strategic plan for growth and development within the organization.

The HR Future

Personnel Management has evolved into Human Resource management, or Human Capital management. Today, practically everyone is familiar with the term Human Resource Management; very few have heard of Personnel Management.  As we turn into a more global society, human resource management responsibilities will escalate and expand.

As companies grow, they might have manufacturing/business locations in countries that have very different cultures and customs from those in the United States.  These countries have differing labor laws and traditions that require special attention, which function will fall to the human resources manager in the support of operations.

Human resource issues are becoming increasingly complex and diversified at an ever-accelerating pace, due to:

• The work place becoming friendlier to working mothers.
• The requirement to recruit highly skilled workers.
• The need to retrain employee’s to keep up with technology.
• Compliance with labor laws that protect minority workers.
• Telecommuting and Outsourcing.
• Employee leasing.
• Global competition and outiside influences.
• The alignment of the workforce with short and long term business strategic planning.

It is certain that the workplace will continue to change, requiring special attention toward the function and responsibility of Human Resource Management, your HR policies and procedures, and your company employee manual.

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Process Improvement Releases Capacity

Using quality tools like lean thinking, six sigma, or theory of constraints has proven that you will release hidden capacity. Productivity will go up and waste will shrink. By now you are thinking great, that’s what process improvement is all about. But if we don’t plan on how to use this extra capacity then we may just end up with no choice but to lay off some idled employees.

The relationship is simple. With company growth, you have to increase capacity by either adding people (scale) or increasing productivity (process improvement). The one trade off is attrition. Some employees may quit or retire as time goes by. Therefore, the equation is:

The Iron Law of Layoffs says that if change management is faster (>) than Revenue Growth + Attrition then layoffs will occur. This means that the more successful an organization is in improving productivity over its growth in revenue then the greater the pressure is for layoffs.

Eliminate Fear

Deming suggested that management should eliminate fear by promising job security. In order to do this management must strategically plan on how to use the capacity released and facilitate change proactively. Otherwise, the Iron Law of Layoffs will make managements promises unbelievable.

The opposite means that if process improvement is slower (Become a Better Manager

One way to be a better manager is to gauge your improvement efforts. If you are in a slow growth market then try working on smaller improvement efforts first. If you are in an elastic market, where customers respond to price changes, then you could use the new capacity to produce more goods at the same fixed costs and lower prices, which should increase demand.

We have seen how using quality tools like lean thinking, six sigma, or theory of constraints will release hidden capacity, increase productivity, and eliminate waste. But we must be careful to respect the Iron Law of Layoffs by keeping our improvement efforts in balance with our growth so we can truly eliminate fear and promise job security that our employees will believe.

Learn more about how to use process improvement programs to work smarter in your organization by attending the next How to Align a System of People and Processes for Results class. If you are eager to learn more about creating more order out of the chaos you are feeling at work then the How to Create Well-Defined Processes class is right for you.

ISO 9000 Quality Auditor classes are forming now for Internal Auditor or Lead Auditor. Call for information on having your own private in-house classes today.

Being a leader means getting things done through others, which implies a team of some kind. The most critical ingredient to leading teams is trust and trust starts with you. The transformation starts at the personal level. When mutual trust exists, people feel motivated to help and support one another. This, in turn, creates a high-trust environment, which is the key to creating high performance work teams.

Creating, building and sustaining trust is hard for some leaders because they might be weak at social interactions, providing substantive feedback, encouragement, or conveying goals. In other words, good leaders must be good communicators.

Factors to Building Leadership Trust

People are social beings. Therefore leading others requires that we have relationships that are based on more than just the task at hand. We need to listen. We do not have to be the best of friends but we do need to be able to work with one another and communicate as friends. Are you able to talk about your employee’s family, their likes or dislikes? Do you even know what they are? Listen.

Do you communicate your vision? Are you enthusiastic at work? Tell your employees “We can do this” or “Yes, it’s possible”. Are your communications predictable? Nobody likes late or last minute news. People like advanced warning. It makes them feel like they are part of the team. Similarly, people do not like being kept in the dark, it makes them feel uncomfortable. Keep people informed of changes, absences, schedules, results, and, most importantly, of daily successes.

Success Builds Confidence, Enthusiasm, and Trust

Provide detailed positive feedback. Use substantial and timely feedback to encourage others on the team. “Great work everyone” works wonders for the team but only say it when you mean it. Conversely negative feedback or constant complaints really weaken trust.

How do you respond in a crisis? Good leaders are able to respond in a calm and unemotional manner. Teams do not like (read trust) wild, chaotic leaders that yell and scream in a crises. But trust increases when leaders calmly avert or deal with a crisis. Success builds confidence.

What Measures Are Needed To Communicate Good Performance?

• Do your measures balance financial and operational demands?
• Are you focused on the critical few measures?
• Are your metrics weighted according to importance, strategy, and vision?
• Is the data you collect timely, reliable and accurate?
• Do you have both leading and lagging indicators?
• Do your measures focus employee behavior?
• What unintended employee behavior could result from your measures?
• How are measures aligned between departments/operating units?
• Are targets set against internal baselines or industry benchmarks?
• Are targets easily attainable or require people to stretch?

Actions Steps to Build Trust

• Clearly define responsibilities
• Develop communication guidelines
• Identify a conflict resolution mechanism
• Select and introduce the team
• Encourage an open exchange of ideas during team creation
• Create a shared purpose, direction and goals
• Provide detailed and timely feedback

This week we have discussed leadership in teams and the design of your measurement system for team success. Building leadership trust is all about communication. Predictable, encouraging, positive feedback builds trust. The measures you choose should support your employee behavior by balancing and aligning your indicators with your goals. If you want to be a good leader then you will need to increase your personal trust through strengthened relationships and improved communications.

To learn more about using process improvement programs for your organization, attend the next How to Align a System of People and Processes for Results class. If you are eager to learn more about creating more order out of the chaos you are feeling at work then the How to Create Well-Defined Processes class is right for you.

ISO 9000 Quality Auditor classes are forming now for Internal Auditor or Lead Auditor. Call for information on having your own private in-house classes today.