People in Organization

MM5005
Jakarta, 26 April 2019
Blemba24

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 Agenda
1. Article & Cases at a Glance
2. Organizational Effectiveness
3. HR Management
4. Case Discussion: JetBlue Airways: Starting from
Scratch
5. Case Discussion: Recruitment of a Star
6. Case Discussion: Microsoft: Competing on Talent
(A)
7. Case Discussion: Citibank: Performance
Evaluation

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ARTICLES & CASES AT A GLANCE

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 Articles & Cases (People)

Session Articles Cases

26 April 2019 Introduction
1
08.00-09.30
2 JetBlue Airways: Starting from Scratch
09.45-11.15
3 Recruitment of a Star
11.15-12.45
4 Microsoft: Competing on Talent (A)
13.45-15.15
5 Citibank Performance Evaluation
15.45-17.15

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 Articles & Cases (People)

Session Articles Cases

27 April 2019 Performance Management at
6
Vitality Health Enterprise., Inc.
08.00-09.30
7 Gap Inc.,: Refashioning Performance
09.45-11.15 Management
8 Marshall & Gordon: Designing an
13.00-14.30 Effective Compensation System (A)
9 Meximizing Your Return on
14.30-16.00 People
10 The Royal Bank of Scotland Group:
16.15-17.45 The Human Capital Strategy

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 Articles & Cases (People)

Session Articles Cases

28 April 2019 Google’s Project Oxygen: Do
11 Managers Matter?
08.00-09.30
12 Oticon (A)
09.45-11.15
13 In Class Written Exam
13.00-14.30
14 In Class Written Exam
14.30-16.00

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ORGANIZATIONAL EFFECTIVENESS

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How an Organization Creates Value

Organizational
Model: e.g. 7S
McKinsey

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 1982 THE 7-S FRAMEWORK
Developed by McKinsey & Company
(Robert Waterman Jr., Tom Peters, and Julien Philips)

Structure

Hard Aspects
Strategy Systems

Superordinate
Goals/Shared
Values

Skills Style

Soft Aspects
Staff

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Star Model for Organization Design

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Business Value Chain Porter

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11
What is Strategy?
Strategy is an Integrated Set
of Choices that uniquely
positions the firm in its
industry so as to create
sustainable advantage and
superior value relative to
the competition.
Lafley, A.G., Martin, Roger L:”Playing to Win:
How Strategy Really Works”, HBRP, 2013

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 Strategy Is the Answer to Five Questions

The right playing field:

•Where we will compete: our geographies, product
categories, consumer segments,
channels, vertical stages of production
The purpose of the enterprise:
•Our guiding aspirations

The set of capabilities required to win:

•Our reinforcing activities
•Our specific configuration
The unique right to win:
•Our value proposition
•Our competitive advantage

The support systems:

•Systems, structures, and measures
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A Strategy Map Represents How the Organization Creates Value

Productivity Strategy Growth Strategy

Long-Term
Financial Shareholder Value
Perspective
Improve Cost Increase Asset Expand Revenue Enhance
Structure Utilization Opportunities Customer Value

Customer Value Proposition

Customer
Perspective Price Quality Availability Selection Functionality Service Partnership Brand

Product / Service Attributes Relationship Image

Operational Management Customer Management Innovation Regulatory and Social

Processes Processes Processes Processes
Internal •Supply •Selection •Opportunity ID •Environment
Perspective •Production •Acquisition •R&D Portfolio •Safety and Health
•Distribution •Retention •Design/Develop •Employment
•Risk Management •Growth •Launch •Community

Human Capital
Learning and Information Capital
Growth
Perspective Organization Capital
Culture Leadership Alignment Teamwork

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 What is Execution?

1. Is the Strategy Wrong?

(The Leaders misjudge the
Company fails to deliver Challenges)
Its promises (commitments)
OR adapt to Change =

Promises (Targets) – Results = Gap 2. The Strategy is not

Executed Well
(Organization aren’t capable of
making it happen)
Made Depend on
by Organization
Leaders Ability

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 Beyond Performance

Focus on Performance
(Short term Only)

Organizational
Effectiveness =

Focus on Performance and Health

(Sustainable Excellence)

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 General Model of Planned Change

Planning Evaluating
Entering and and
and Diagnosing Implementing Institutionalizing
Contracting Change Change

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 Organization-Level
Diagnostic Model
Inputs Design Components Outputs

Technology
General
Environment Strategy Structure

Effectiveness
Organization
Industry
Structure
HR Measurement
Systems System

Practical: 7S McKinsey;
Galbraith STAR Model, etc.
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 Behavior = f (M, A. E)
Recruitment

ABILITY

Selection Training &

Development

BEHAVIOR/
Organizational
PERFORMANCE
Compensation Design

MOTIVATION ENVIRONMENT

Culture Performance Organizational HR Planning

Management Development/
Change
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 Recruitment of a Star
13.25-13.45
Make your decision, who should become the
replacement for Peter Thompson? Why?

john.w@sbm-itb.ac.id

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HR MANAGEMENT

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 Attributes of Personnel, HRM and HCM
(Evolution of People Management)

Personnel HRM = Personnel + HCM = HRM+

People management A separate process An aligned process An integrated process
strategy development focused on activity focused on activity focused on intangible
(e.g. Talent and capability (e.g. capability (e.g. Career
management for Development of talent partnership), that
everyone) pools) to meet provides the potential
business objectives to sustain and
transform the
business
People management Basic practice Best practice Best fit
practices
Outputs of people Value for money Added value Created value
management
Assumptions about Causal chains Dynamic systems Complex processes
business environment
Appropriate form of Data Information Knowledge
information
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Stakeholder
Interest
Harvard Model of HRM
Stakeholders
Management
Employee groups
Government
Community
Unions Long-term
HRM Policy Consequences
HR Outcomes
Choices Individual
Commitment
Employee Influence well-being
Situational Competence
Human resource flow Organisational
Factors Congruence
Reward systems effectiveness
Work force Cost-effectiveness
characteristics Work systems Societal
Business strategy well-being
and conditions

=
Management
philosophy
Labour market
Unions Able to execute
Task technology Operate efficiently
Laws and Engage employee
societal values Manage change
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HRM PRACTICES

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HR Strategy and Performance

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 HR Strategy
HR strategy means a system of human
resource practices for a particular job or
collection of jobs aimed at the best
employee performance possible to meet
the firm’s ultimate goals.
• Have something (skills, competencies, abilities).
• Feel something (commitment, engagement, motivation).
• Do something (come to work, be productive, serve
customers, stay with the organization).

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Model of the link between HRM
and Performance

CIPD
The case for good people management
A Summary of the Research
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 Strategic Management Process Model

HR Practices
•Recruiting
External Analysis •Training
•Opportunities •Performance management
•Threats •Labor relations
•Employee relations Firm
•Job analysis
•Job design Performance
Human •Selection •Productivity
Resource •Development •Quality
Strategic •Pay structure •Profitability
Mission Goals Needs •Incentives
Choice •Skills •Benefits
•Behavior
•Culture
Human Human
Internal Resource
Capability Resource
Analysis Actions
•Strengths •Skills,
•Abilities •Behaviors
•Weaknesses
•Knowledge •Results

Strategy Formulation Strategy Implementation

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A NEW MANDATE FOR HUMAN
RESOURCES

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 Quiz
Why HR will need a New Mandate?

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 A MULTIPLE-ROLE MODEL
A Multiple Roles for Human FOR HRM
Resources

FUTURE/STRATEGIC
FOCUS

Management of Management of
Strategic Human Transformation
Resources and Change
PROCESSES PEOPLE

Management of Management of
Firm Infrastructure Employee
Contribution
= Administrative Expert

DAY-TO-DAY/OPERATIONAL
FOCUS
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 Administrative Expert
• Reengineering e.g. Providing Shared Services

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 HR Champion
• Becomes the Voice of Employees
• Becomes People Manager
• In cooperation with Line Managers, try to
push Employee Contributions (e.g.
implementing Action Research Approach)

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 Action Research Model
Problem Identification
Joint diagnosis

Consultation with a
behavioral scientist Joint action planning

Data gathering & Action

preliminary diagnosis

Data gathering after

Feedback to Client action

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 Strategic Business Partner
• HR should know (what and how to develop)
the Business (Corporate/Enterprise) Strategy
• Able to develop Organizational Design that
will be needed to Execute the Strategy

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 Strategic Management Process Model

HR Practices
•Recruiting
External Analysis •Training
•Opportunities •Performance management
•Threats •Labor relations
•Employee relations Firm
•Job analysis
•Job design Performance
Human •Selection •Productivity
Resource •Development •Quality
Strategic •Pay structure •Profitability
Mission Goals Needs •Incentives
Choice •Skills •Benefits
•Behavior
•Culture
Human Human
Internal Resource
Capability Resource
Analysis Actions
•Strengths •Skills,
•Abilities •Behaviors
•Weaknesses
•Knowledge •Results

Strategy Formulation Strategy Implementation

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 Change Partner
A Framework
Why Recognizing the Pressures (Drivers, or Forces) to Change
What Types of Change: Small, Big or in Between
What Changes: Organizational Elements
Who Take Initiatives; Who becomes the objects
When The timing of Change
How The Process of Change

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 The Pressures for Change

External Forces Internal Forces

Technology Leadership and Vision
Economy Workforce Demographics
Market Niche Employee Dissatisfaction
Human/Social Needs and Values New Ideas
Government Policies Performance Failures

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 Kotter’s Eight-Step Change Management Model

Embed the change in the

culture
Consolidate gains
Ensure there are short-term
wins
Empower staff
Communicate the Vision
Develop a Vision
Ensure there is a powerful change group to guide
change
Establish the need for urgency
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Microsoft: Competing on Talent (A)
1. Please identify and describe what is the HR Strategy at
Microsoft in 1980s.
2. Is the HR Strategy support the Business Strategy? Explain.
3. Why Steve Balmer, when he rejoined the Microsoft in
1998 do some changes? What are those changes?
4. Choose and develop a Competency based on Key Success
Factors (please use Spencer and Spencer “Competence at
Work”) for the purpose of class discussion.
5. Please develop the Employee Value Proposition at
Microsoft in 1999, by using the information available at
the case study.
6. What problems are not yet solved and try to suggest your
solutions?

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Exhibit 1.4: Total Returns for Work

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Exhibit 1.5: The Pay Model

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Employee Value Proposition

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CLAN Flexibility and Discretion ADHOCRACY
Orientation: Collaborative Orientation: Creative
Leader Type: Facilitator; Mentor; Leader Type: Innovator; Entrepreneur;
Team Builder Visionary
Value Drivers: Commitment; Value Drivers: Innovative outputs;

External Focus and Differentiaton

Communication; Development Transformation; Agility
Internal Focus and Integration

Theory of Effectiveness: Human Theory of Effectiveness: Innovativeness,

development and Participation produce vision, and new resources produce
effectiveness effectiveness

Orientation: Controlling Orientation: Competing

Leader Type: Coordinator; Monitor;
Organizer
Value Drivers: Efficiency; Timeliness;
Consistency and Uniformity
Theory of Effectiveness: Control and
Efficiency with capable processes produce
effectiveness
Leader Type: Hard Driver; Competitor;
Producer
Value Drivers: Market share; Goal
achievement; Profitability
Theory of Effectiveness: Aggressively
competing and customer focus produce
effectiveness

HIERARCHY Day1 - PIO Blemba24-26Apr19

Stability and Control MARKET 44