CHAPTER 10 Developing Employees Their Careers Employee development involves activities that influence their personal and professional growth Training a planned effort to help employees learn job related knowledge skills and attitudes An organization s employee development practices are strategic when they help the organization maintain a continual supply of talented and committed employees Aflac example Related to employee development is career development which includes activities that help people manage the progression of their work experiences across their lives How can organizations help employees develop Formal education courses certification and licensing License a required designation of competence within a professional field Certification an optional designation of competence within a professional field Assessments and feedback career assessment Holland typology multisource assessments Holland typology a classification developed by Dr John Holland of people s interests values and skills and of job environments the typology asserts that people will be more satisfied and more successful in jobs that closely match their characteristics Multisource assessments and feedback a process in which an employee s managers peers and sometimes subordinates and customers answer questions about the employee responses are combined and provided as developmental feedback to the employee Work experiences job enrichment job rotation job transfer upward move downward move Job enrichment the addition of challenges or new responsibilities to jobs Job rotation a time limited later work assignment for the purpose if helping employees develop new knowledge and skills Upward move a career move resulting in an increase in responsibility pay and status also known as a promotion Downward move a career move resulting in a decrease in responsibility pay and status also known as a demotion Developmental relationships coaching mentoring Coaching when a person works with others to equip them with the tools knowledge and opportunities they need to become more effective at work Mentoring when an experience person helps a less experienced person learn and grow Strategic Employee Development Career the pattern of work experiences a person has over his or her lifetime Emphasis toward Psychological Success Career Development Process The career development process includes four steps self assessment reality check goal setting and action planning Self assessment is a process in which employees determine their interests values personalities and skills CHAPTERS 11 12 External Equity Internal Equity Reality check employees gather information to determine whether their self assessments are realistic and how those assessments fit with opportunities in the labor market and with their current employer s future labor needs Goal setting involves setting milestones or achievements for the future such as positions to achieve skills to be gained and development efforts to pursue Action planning employees make plans for how they will accomplish their goals Employee compensation process of paying and rewarding people for the contributions they make to an organization Compensation broad term which includes pay and benefits such as insurance retirement savings and paid time off from work Represents the total package of rewards both monetary and nonmonetary Employees perception of external equity which concerns the fairness of what the company is paying them compared with what they could earn elsewhere Organizations with an external labor orientation must assess how their compensation compares with the compensation offered by other organizations Employees perceptions of internal equity their beliefs concerning the fairness of what the organization is paying them compared with what it pays other employees Organizations with an internal orientation spend time and effort comparing and analyzing pay differences among their own employees Pay practices such as how much each person makes are usually less secretive in these organizations than in organizations with an external orientation Internally oriented organizations also use long term incentives to reward employees who stay with them for long periods Strategic Framework for Employee Compensation 3 Elements of Motivation Behavioral choice involves deciding whether to perform a particular action Intensity concerns deciding how much effort to put into the behavior Persistence involves deciding how long to keep working at the behavior Motivation Theories Reinforcement theory people are motivated by antecedents environmental cues and consequents rewards and punishments Goal setting theory an individual s conscious choices explain motivation Justice theory motivation is driven by beliefs about fairness Expectancy theory people are motivated by a combination of 3 beliefs valence instrumentality and expectancy Agency theory an economic theory that uses differences in the interests of principals owners and agents employees to describe reactions to compensation Linking Motivation with Strategy Variable compensation and motivation although some experts have suggested that linking pay to performance can reduce the joy of performing naturally interesting tasks a majority of evidence shows that performance increases when high performers are paid more than low performers The strategic importance of differentiation makes high performance of employees critical for these organizations and linking pay with performance is a strong motivator that encourages employees to put forth their best efforts Understanding what reference group employees use in assessing the fairness of their pay is another important feature of variable compensation strategies Because organizations with a Committed Expert HR strategy are interested in developing ongoing relationships with employees procedural fairness is particularly important for these organizations Unfortunately many variable compensation practices fail to motivate because the size of the potential reward isn t large enough to influence behavior Uniform compensation and motivation uniform compensation practices aren t as effective as variable compensation practices for encouraging high motivation In judging whether their pay is fair employees in an organization with a Loyal Solider HR strategy tend to compare themselves with employees working in the same organization Organizations with a Bargain Laborer HR strategy seek to pay the lowest possible wages Pay Level