You can manage anything - changes, garden, risks, bandit group, transportation, quality and so on. People can also be controlled. That's just people - this is the most complex and variable object of management. Human Resource Management is no longer dusty folders with strings in rickety cabinets. Ways to affect people are changing too. Try to threaten generation Y hipster with an administrative penalty or just say the magic words “you should”. And watch his reaction. Most likely, he will shrug and leave. From the company.
Whips or gingerbread cookies, pistols or carrots? Or is it desirable all together and at the same time? We deal with administrative, economic and social methods of personnel management: what is the essence and what works better. All of them are directly related to the most important tools in the field of human resources - motivation and stimulation.
Administrative, economic and social methods of personnel management
First you need to figure out the right place for economic methods in a powerful block of chapters and sections on human resource management. It is among the three classical methods of personnel management, which differ from each other in the way they influence employees. The classification of personnel management methods into administrative, economic and psychological methods has existed for a long time. We will proceed with this classification as follows:
- administrative methods - go over them easily and effortlessly;
- economic methods - our subject for detailed reading, here we will stop;
- psychological methods of personnel management, often called social methods - we’ll go over them too.
Let's start with administrative methods.
Where is my black gun
Power, discipline, legal penalties, reprimands. A stick instead of a carrot, a gun instead of a carrot. We add more associations: dust and naphthalene. In fact, administrative methods, considered to be the classics of communist education and management of the human masses, are working worse and less often used in most companies. Socio-economic methods of personnel management are used today more often and more widely. There are only five administrative ways to influence unhappy employees:
Organizational influence with charters, orders, internal rules that must be followed without fail. Suitable for army units with their military discipline. Companies with a cloud of disciplinary documents are still enough, but they are becoming smaller, and employees are obeying orders worse and worse.
Managing influence is similar to organizational. There is a whole package of standard administrative documents:
- Orders are the most tough decisions from the boss, which must be followed without fail.
- Orders - deputy chiefs like to publish such papers. The addressee is usually some unit, not the whole company.
- Instructions and instructions are the most “calm” documents, usually issued by the personnel department.
Penalties and disciplinary liability are a favorite topic of battle-hardened old personnel officers. Discipline is a behavioral concept, it is mandatory for all to obey the rules established in a particular company. Another question is how appropriate and tough are these rules. Any behavioral or ethical codes are extremely subtle tools for influencing people. They are necessary - no doubt. As well as socio-economic methods of personnel management , they need to be written carefully and taking into account the characteristics of the personnel of the company: from age and profile professions to the "geography" of the organization. Incremental disciplinary action:
- comments;
- rebuke;
- dismissal under article.
Liability applies if the company has suffered material damage. The rules and restrictions are well defined in the Labor Code (the property of all labor codes is a detailed description of punishments and penalties of any kind, such is their nature of these codes).
Criminal liability takes effect when committing crimes. This may be an excess of authority, arbitrariness, violation of labor law in the form, for example, forgery of documents.
Social or psychological methods
Depending on who the psychological impact is directed at, the methods are divided into two groups:
- sociological if work is going on with a group of people;
- psychological, if under the influence of one person.
Priority concepts and terms of this group of methods: cooperation, partnership, integration, conservation, etc. This group of methods pursues and fulfills the following goals:
- creation and support of a comfortable psychological environment in the team;
- the formation of departments and divisions taking into account the psychological interaction of employees;
- prevention and resolution of conflicts - production and interpersonal;
- formation and support of organizational and corporate culture with the definition of ideological attitudes and norms of corporate behavior.
There are a lot of ways of psychological influence: compliments, praise, suggestion, condemnation, inspiration, censure, hints and so on. Feedback from the boss is nothing but the most real psychological impact on the subordinate. These tools work great, they must be owned without fail. Because psychological tools can work both ways - to bring significant benefits, as well as cause serious damage. Unlike administrative and economic methods of personnel management, this method requires knowledge and communication skills. Leaders who think about tomorrow learn this and are fluent in them.
Economic methods
Economic methods of personnel management can also work in both directions - and encourage and punish. But the most valuable side of the method is its “encouraging” area. That's where you can take a walk - the space for competent and effective financial motivation is huge.
In the personnel management departments, new units appeared under the heading of “compensation and benefits”. Compensation and benefits specialists are highly valued in the labor market and are never left without work. The most important economic method of personnel management is the general “economic umbrella” - universal technical and economic planning. This is the formation of a strategy, goals, objectives and plans for their implementation. Planning and distribution of resources, including financial, implies the successful implementation of all strategic goals, including the impact on employees using economic methods of personnel management of the organization.
Classification of economic methods
Economic methods of personnel management include a huge number of ways a huge number, so at first they are divided into three large groups:
- Economic calculation (let this "Soviet" term not mislead you, everything is in order from the point of view of modernity). The essence of the method is the interest of employees to do as much as possible in order to divide net profit among themselves (everything that remains after subtracting all costs from total income). Naturally, with such calculations, a high degree of team independence with clearly defined standards and self-sufficiency is needed.
- Material incentive. The most “densely populated” group of economic methods of personnel management, the essence of which is the search for the optimal level of remuneration (these are all familiar bonuses and salaries), benefits and compensations. At this very level, the interests of all parties converge: the workers themselves, their employers and the state as a social "auditor". A triangular mutually beneficial partnership is an absolute must for an effective financial incentive system.
- Participation in the company's profits through the purchase of its shares or bonds (the ultimate dream of many young careerists, especially among employees of audit, legal and other consulting firms).
Her Majesty's wages
In the vast majority of cases, the payroll fund is the largest expenditure item in the annual budgets of companies. The formal definition of wages from the Russian Labor Code is
Remuneration for work depending on the qualifications of the employee, the complexity, quantity and quality and conditions of the work performed, as well as compensation and incentive payments.
Salary is of two types: basic and additional.
The main salary is paid if the employee has fully worked the established working time, most often it is an 8-hour working day or a 40-hour working week. The basic salary is calculated depending on whether the system is a piecework or time wage system. For office workers with a fixed working day, the salary is multiplied by the percentage of hours worked. There is another option in which the daily salary is multiplied by the number of days worked per month.
Additional wages are charged for non-standard working conditions or employee qualifications. These may be surcharges or compensation for:
- work in hazardous industries;
- irregular working days, overtime on weekends and holidays;
- additional load and combination of duties;
- academic degree, coolness.
Remuneration for the final result - most often this is additional cash, included in advance in the payroll budget with clearly defined options for achievement. They are paid to a group of employees for specific achievements: increasing labor productivity, saving costs, increasing the volume of products or services, receiving positive feedback from key customers, etc.
The bonus for the main results of labor is paid exactly for the same achievements as remuneration. The only difference is that the funds for this premium are taken from profit, and not from the wage fund. Recently, it is rarely used, as business owners prefer to pay a premium in any other way, minimizing profits.
Material assistance - payments to employees according to their statements regarding unforeseen or extreme events: death of relatives, accidents or treatment. One of the stereotypes is to think that material assistance is paid only in distress, and it is also provided in case of positive events: weddings, the birth of a child, vacations for buying permits, and the end of creative work - a dissertation or a book. A feature of such payments is their episodic nature.
Benefits and Privileges
In essence, these are additions to all of the above methods of economic personnel management. They can be conditional, which include pension payments, insurance, sick leave. Recently, there have been some changes with sick leave: employees increasingly prefer not to use this service, since the tariffs for paying sick days are in most cases extremely low (the exact amounts depend on companies that also prefer not to “motivate fans to cheer”).
Direct benefits include, for example, paying annual leave, which by its sources does not apply to classic wages, dismissal payments due to staff reductions, supporting children in one form or another, loans and loans, membership fees, vehicles, gasoline, corporate lunches, mobile communications and so on. With the help of benefits, companies achieve certain goals:
- increasing employee loyalty to the company;
- covering security needs is a powerful psychological factor;
- Formation of an employer brand as a socially-oriented company;
- tax optimization.
Profit sharing
The third subgroup of economic methods of personnel management, gaining increasing popularity and desirability among employees. Participation in transactions with securities, which by their nature are equivalent to the rights to own a company.
Shares - this is the annual receipt of dividends as a share of profit as a result of the annual activities of the company. Losing shares to their employees, companies pursue and successfully solve several goals:
- fixing the employee’s right to own and receive part of the profit;
- receiving additional pay;
- employee dependence on the quality of labor and products;
- formation of persistent loyalty to the company.
Another form of securities is bonds, which also give the right to receive income at the end of the year in the form of an agreed fixed interest. Bonds can be sold, in which case employees will receive financial compensation.
Examples of economic methods of personnel management
- One of the most popular examples is corporate canteens or sales of goods at a discount for employees.
- Interest-free loans (or with a very low interest rate) to employees are widespread and “working”: not only motivation plays a role, but the fact that in most cases a person will not quit until he pays the company's debt.
- Partial or full private health insurance.
- Corporate events that are now far from banquets with an insane amount of alcohol. It can be joint helicopter flights, skydiving, trips, excursions and so on.
Assessment and conditions for the high efficiency of economic methods
- There is the concept of “threshold for the significance of money” - the minimum amount of money below which payments cease to be significant for the employee. Small amounts for incentives are common and unpleasant mistakes of companies when the total costs will be significant, but completely useless in their impact on people. The threshold of significance is an individual value, which depends on many factors. To know the average values of thresholds of significance among employees of different categories is a direct responsibility of the personnel management department.
- Accounting for employees for whom non-financial incentives are much more important than financial. For example, the category of young mothers: they are much more interested in a convenient flexible working day schedule, which in no way relates to economic methods of personnel management. This does not mean that such mothers do not need to pay extra money, they simply have a significantly higher threshold for the significance of money.
- Any incentive payments should be made as part of a transparent and understandable performance appraisal and reward system. Each employee should not only understand well why and for what he received a prize at the end of the year, but also be in agreement with the estimate and amount. This is the main condition for the success of any economic means of stimulating employees, which are often neglected in companies. Ignoring communication activities reduces the effect of invested money by half at least. Full understanding, full agreement - only in such conditions it makes sense to spend considerable additional funds.
The effectiveness of personnel management is evaluated according to two parameters - the economic and social components of work with employees. If social efficiency is assessed by the level of staff turnover, where the main figure is the turnover rate, then the methods for assessing the economic efficiency of personnel management are reduced to calculating the ratio of the average annual production of products / services to the average number of employees. This ratio is called the average annual output per employee.
Administrative, economic and socio-psychological methods of personnel management exist and are used only for one thing - achieving the strategic goals of the company. The choice of one method or another depends on the company itself and the context of its business. One of the common options is a combination of administrative and economic methods of personnel management, which consists in reinforcing various cash payments and recovering orders, codes and other corporate documents. It should be noted that all three methods of influencing staff are an excellent space for staff creativity and experiments in the best sense of these words.
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