Making Human Resource Decisions: Improving Organisational Design and Managing the Human Resource Flow

Job Design

Job design describes the content of each role in a business. For example, a machine operator might be responsible for operating certain types of machine and maintaining those machines.

Clear definitions of roles and responsibilities will:

1. Improve or maintain quality.
2. Improve or maintain productivity.
3. Reduce costs such as wastage.
4. Ensure that the right person is doing the job.

Hackman and Oldman’s Job Characteristics Model

Hackman and Oldman believe that the key to staff motivation is the job itself. If a business can design a job which has variety and challenges, then the worker will be more motivated.

The model has five characteristics on how to motivate the worker:

1. Skills variety – Enough different elements to the job to avoid monotony.
2. Task identity – The job holder knows exactly how the task fits into the success of the business.
3. Task significance – The job holder knows exactly the extent to which that task contributes to the success of the business.
4. Autonomy – The job holder has some ability to act independently.
5. Feedback – The job holder has meaningful feedback on how they are doing.

Organisational Design

Organisational design describes how a business organises the way that decisions are passed through the business. This is normally known as a hierarchy.

A hierarchy describes the structure of the management, usually as a formal chart. In a formal hierarchy, job roles are clearly defined with clear lines of accountability and responsibility. In an informal hierarchy, roles and responsibilities are more fluid and may change daily. There will be no formal chart.

Key terms in organization design are:

1. __Authority __– the power to give orders to others.
2. __Delegation __– giving decision making powers to subordinates.
3. Span – the number of workers under one manager.

Wide Span

A wide span has lots of workers per manager. It’s often part of a flat organisation, which means few levels of management.

Advantages

A wide span of control encourages the leader to be more democratic and delegate authority to the subordinates, which could be motivating for them.

Creates a more entrepreneurial culture as workers can take responsibility for jobs, thus potentially improving communication.

Disadvantages

However, wide spans of subordinates may be hard for one manager to supervise and co-ordinate.

It increases the risk of poor decision making if subordinates lack experience.

Narrow Span

A narrow span has fewer workers (subordinates) per manager. It’s often part of a tall organisation, which means lots of levels of management.

Advantages

Works well for managers who don’t have time to manage many subordinates.

Disadvantages

Narrow spans of control can create a ‘them and us’ culture, where the workers and managers don’t trust each other. This could lead to demotivated workers.

Delegation

Delegation is giving decision making powers to subordinates lower down in the hierarchy.

Advantages

1. As a result, both managers and subordinates are more motivated - relate to Herzberg’s motivators and Maslow’s higher level needs. Therefore, improves productivity.
2. Can also result in senior managers having more time for important strategic decisions.

Disadvantages

1. Can lead to confusion within the business about roles. If one manager works differently from another then it could be harder to organise and co-ordinate the business.
2. Trusting subordinates can be risky and expensive if e.g. they have inadequate skills or are not hardworking.

The Value of Changing Job and Organisational Design

When the business sets its corporate objectives, it needs to plan how it will achieve these objectives.

To do this effectively, it might need to adjust the roles of the workforce and how the workforce is organised to achieve these objectives.

For example, changing production techniques, launching a new product, reducing staff costs or opening a new store all require possible changes to the design.

Clearly communicated roles and chains of command enable these changes to be made effectively.

How Managing the Human Resource Flow Helps Meet Human Resource Objectives

Human resource flow describes the employee journey through the organisation from initially identifying the need for that employee to when the employee leaves the business.

The flow is a human resource plan __>___ recruitment __>__ training__ >__ redeployment __>__ redundancy or retirement._

Good flow allows the right number of the right type of worker to be available at the right time to meet the business’s needs.

The business will need sometimes to recruit and sometimes to cut workers. Also, if the business is moving through a period of technological change, it will need to retrain or reassign workers.

Factors affecting recruitment and selection

1. Job requirements – skills and number of workers required at that level
2. Current workforce – can the current workforce meet the requirements, and if so, do new workers need to replace those promoted or retrained
3. Costs of recruitment and finance available.
4. __Supply of labour __– are there available workers ready to join the business.

Definitions

Authority	The power to give orders to others.
Autonomy	The amount of control a worker has in their working patterns.
Centralised	An organisational structure where authority rests with senior management at the centre of the business.
Decentralised	An organisational structure where authority is delegated further down the hierarchy, away from the centre.
Delegation	Giving decision making powers to subordinates.
Hackman and Oldman’s job characteristics model	Hackman and Oldman believe that the key to staff motivation is the job itself. If a business can design a job which has variety and challenges, then the worker will be more motivated.
Hierarchy	The chain of command in a business. Who’s in charge of whom.
Human resource flow	The employee journey through the business from planning, to recruitment, deployment and then leaving.
Job design	The roles and responsibilities of a worker.
Narrow span of control	Few workers per manager.
Organisational design	Organisational design is how a business organises the way that decisions are passed through the business.
Productivity	Output per worker
Quality	Meets fully expectations of customer or business.
Span of control	The number of workers under one manager.
Wide span of control	Lots of workers per manager.

What describes the content of each role in a business?

job design

A formal chart of which describes the structure of the management is known as what?

hierarchy

What are the three key terms in organizational design?

Your answer should include: authority / delegation / span

A flat organization has what type of span of control?

wide

Exam Style QuestionAnalyse the possible reasons why a business which makes and sells automotive parts might not use delegation. [9 marks]

Your answer should include: costs / time / expertise / trust / co-ordination
Explanation: This is a 9 mark question. You would spend around 10 minutes in the exam on this. You should make between two and three key points and then apply them to this particular business. Analysis means showing how a key point impacts on a business. It gives the causes and the effects. You will be using terms like: because, so, therefore and means. In this question, consider the type of decisions it needs to make and what impact delegation might make on the profitable execution of these decisions.