10.1.4 How to manage Human Resources?

The recruitment and selection process  has three main phases divided in several steps. These are presented in Fig. 2.
You can find out more about the phases and steps of the recruitment and selection process by clicking on the boxes of the flow chart.

Fig. 2.: The main phases and steps of the recruitment and selection process


Innovation in business depends at a high degree on the professional knowledge and skills of the staff. But, in our rapidly changing world with continuous changes in the market and technologies, even if the company hired qualified persons, their knowledge becomes obsolete in a very short time. The manager should take measures to keep the employees’ knowledge and skills up-to-date according to the needs of the business.
The activities of the HR Development process  are presented in Fig. 3.
To find out more about each activity click on the respective boxes (dark blue).


Motivation is an inner psychological state determining a particular action when the person feels that this action will lead to the satisfaction of his/her needs and expectation.
For a manager, motivating his/her employees means creating and maintaining the conditions for employees to progress in the direction of achieving company goals.
Motivation can be enhanced by two types of techniques :
-    Financial: connected to the salary system, usually with a short term effect
-    Non-financial: connected to the work itself and having a longer term effect.

C.1 The financial motivators are:

  • Base salary: can be linked to the job (paying the job’s value to the organisation), used mainly in production and service processes, or to employees’ competences (paying the value to the organisation of the individual’s level of competences), specific mainly to research activities.
  • Variable pay:
    • incentives aiming to motivate employees to achieve their objectives, to improve their performance or enhance their competences focusing on a specific target,
    • financial rewards providing financial recognition to people for their achievements.
  • Benefits: contribution to pension and health insurance schemes, life insurance, loan with lower interest rate, free products or services of the company, etc.
  • Allowances for relocation, lodging, transport, subsistence, recreation, etc.   

C.2 Non-financial motivation techniques

  • Job rotation: Is the process of regularly moving an employee between operations /tasks/jobs with the same level of skill requirement and situated at the same hierarchical level, requiring approximately the same level of knowledge and competences.
  • Job enrichment: Refers to a permanent modification in the job’s content by extending the range of tasks/operations with other easily performable but important tasks, requiring different skills and knowledge, and sometimes involving a higher level of responsibility, e.g. planning, negotiation, control, writing reports, making presentations etc.
  • Delegation: Is the process of assigning tasks or projects to subordinates and by transferring the authority to make decisions in that particular field, and clearly dictating expected outcomes and a time frame for completion. The delegation is successful only if the employee has the competences needed to perform the task with a minimum of guidance and some extra input.
  • Involving employees in important matters of the company (e.g. shaping the culture, elaboration of strategic plan, solving an important market problem)
  • Communication of all important matters concerning the company, its future and its human resources
  • Feedback on the results and performances (individual, team and company)
  • Management by walking around: visits to the offices, workshops, and labs regularly, asking employees about their work and problems, giving them feedback etc.  

Non-material motivators usually do not cost anything! They depend on the willingness of managers to pay more attention to their staff, and can be very effective.

The state of motivation is present only if the organisational conditions (payment, nature of work, working climate, etc.) satisfy employees’ needs and expectations. The first step in motivating people is finding out their needs, expectations and the value they attach to the motivational factors. On this basis, line managers can personalise motivational techniques. The elements which must be consistent at organisational level (e.g. salary system, benefits system) can be supplemented with individual measures applied by the line manager.

C.3 Personalising motivational techniques examples:

  • Cafeteria system” for the benefits: A list of possible benefits and their total value for groups of jobs/employees should be established. The employees can then choose their preferred benefits and the value of each benefit within the limit of their annual benefits level.
  • The manager can apply a different management approach for employees with different working styles and personalities, e.g.:
    • gives goals, tasks, resources or deadlines to employees and check the results in case of employees preferring autonomy,
    • establishs check points, discusses the task step by step, gives feedback after each work phase to the less autonomous employees.

    1 Based on: Pataki Csilla (2005): A munkamotiváció növelése, pag. 15-32