CBOE 2013 versus BSE 1993

Earlier this week, the US SEC imposed a fine on the Chicago Board Options Exchange (CBO) for conduct reminiscent of what used to happen in the Bombay Stock Exchange (BSE) two decades ago. In the early 1990s, the BSE board was dominated by broker members, and allegations of favouritism, conflict of interest and neglect of regulatory duties were very common. At that time, many of us believed that these were the kinds of problems that the US SEC had solved way back in the late 1930s under Chairman Douglas. India might have been six decades behind the US, but it is widely accepted that security market reforms in the 1990s solved this problem in India, though this solution might have created a different set of problems.
For more:
http://www.iimahd.ernet.in/~jrvarma/blog/index.cgi/Y2013/CBOE-2013-BSE-1993.html

JOB ANALYSIS

JOB:

“Job is a ‘group of tasks to be performed everyday.”

JOB ANALYSIS

Definition 1: (Process of Collecting Information)

“Job Analysis is a process of studying and collecting information relating to operations and responsibilities of a specific job. The immediate products of this analysis are ‘Job Description’ and ‘Job Specifications’.”

Definition 2: (Systematic Exploration of Activities)

“Job Analysis is a systematic exploration of activities within a job. It is a basic technical procedure that is used to define duties and responsibilities and accountabilities of the job.”

Definition 3: (Identifying Job Requirements)

“Job is a collection of tasks that can be performed by a single employee to contribute to the production of some product or service, provided by the organization. Each job has certain ability requirements (as well as certain rewards) associated with it. Job Analysis is a process used to identify these requirements.”

MEANING OF JOB ANALYSIS

Job Analysis is a process of collecting information about a job. The process of job analysis results into two sets of data.

·         Job Description

·         Job Specification

As a result Job analysis involves the following steps in a logical order.

Steps of Job Analysis

1.      Collecting and recording job information

2.      Checking the job information for accuracy

3.      Writing job description based on information collected to determine the skills, knowledge, abilities and activities required

4.    Updating and upgrading this information

PURPOSE OF JOB ANALYSIS: -

·           Human Resource Planning (HRP): - The numbers and types of personnel are determined by the jobs, which need to be staffed. Job related information in the form of Job Analysis serves this purpose or use.

·           Recruitment & Selection: - Recruitment precedes job analysis. It helps HR to locate places to obtain employees. It also helps in better continuity and planning in staffing in the organization. Also selecting a good candidate also requires detailed job information. Because the objective of hiring is to match the right candidate for right job

·           Training & Development: Training and development programs can be designed depending upon job requirement and analysis. Selection of trainees is also facilitated by job analysis.

·           Job Evaluation: Job evaluation means determination of relative worth of each job for the purpose of establishing wage and salary credentials. This is possible with the help of job description and specifications; i.e. Job Analysis.

·           Remuneration: Job analysis also helps in determining wage and salary for all jobs.

·           Performance Appraisal: Performance appraisal, assessments, rewards, promotions, is facilitated by job analysis by way of fixing standards of job performance.

·           Personnel Information: Job analysis is vital for building personnel information systems and processes for improving administrative efficiency and providing decision support.

·           Safety & Health: Job Analysis helps to uncover hazardous conditions and unhealthy environmental factors so that corrective measures can be taken to minimize and avoid possibility of human injury.

PROCESS OF JOB ANALYSIS

Process 1: Strategic Choices

Process 2: Collecting Information

Process 3: Processing Information

Process 4: Job Description

Process 5: Job Specification

Strategic Choices: -

Extent of involvement of employees: Extent of employee involvement is a debatable point. Too much involvement may result in bias in favor of a job in terms of inflating duties and responsibilities. Too less involvement leads to suspicion about the motives behind the job. Besides it may also lead to inaccurate information. Hence extent of involvement depends on the needs of the organization and employee.

Level of details of job analysis: The nature of jobs being analyzed determines the level of details in job analysis. If the purpose were for training programs or assessing the worth of job, levels of details required would be great. If the purpose is just clarification the details required would be less.

Timing and frequency of Job Analysis: When do you do Job Analysis?

·                     Initial stage, for new organization

·                     New Job is created

·                     Changes in Job, Technology and Processes

·                     Deficiencies and Disparities in Job

·                     New compensation plan is introduced

·                     Updating and upgrading is required.

Past-oriented and future-oriented Job Analysis: For rapidly changing organization more future oriented approach would be desired. For traditional organizations past oriented analysis would be required. However more future oriented analysis may be derived based on past data.

Sources of Job Data: For job analysis number of human and non-human sources is available besides jobholder himself. Following can be sources of data available for job analysis.

Non-Human Sources	Human Sources
Existing job descriptions and specifications Equipment maintenance records Equipment design blueprints Architectural blueprints of work area Films of employee working Training manuals and materials Magazines, newspapers, literatures	Job Analysis Job Incumbents Supervisors Job Experts

Collecting Information: -

Information collection is done on the basis of following 3 parameters

Types of Data for Job Analysis:

·                     Work Activities (Tasks details)

·                     Interface with other jobs and equipments (Procedures, Behaviors, Movements)

·                     Machines, Tools, Equipments and Work Aids  (List, Materials, Products, Services)

·                     Job Context (Physical, Social, Organizational, Work schedule)

·                     Personal Requirement (Skills, Education, Training, Experience)

Methods of Data Collection:

·                     Observation

·                     Interview

·                     Questionnaires

·                     Checklists

·                     Technical Conference

·                     Diary Methods

Who to Collect Data?

·                     Trained Job Analysts

·                     Supervisors

·                     Job Incumbents

Processing Information: -

Once the job information is collected it needs to be processed, so that it would be useful in various personnel functions. Specifically job related data would be useful to prepare job description and specifications, which form the next two processes of job analysis.

METHODS OF DATA COLLECTION:

Observation: Job Analyst carefully observes the jobholder and records the information in terms of what, how the job is done and how much time is taken. It is a simple and accurate method, but is also time consuming and inapplicable to jobs involving mental activities and unobservable job cycles. The analysts must be fully trained observers.

Interview: In this analyst interviews the jobholders, his supervisors to elicit information. It can be Structured or Unstructured Interview. Again this is also a time consuming method in case of large organizations. Plus there is also a problem of bias.

Questionnaires: A standard questionnaire is given to jobholder about his job, which can be filled and given back to supervisors or job analysts. The questionnaire may contain job title, jobholder’s name, managers name, reporting staff, description of job, list of main duties and responsibilities etc. It is useful in large number of staffs and less time consuming. However the accuracy of information leaves much to be desired.

Checklists: It is more similar to questionnaire but the response sheet contains fewer subjective judgments and tends to be either yes or no variety. Preparation of checklist is a challenging job itself.

Technical Conference: Here a conference of supervisors is used. The analysts initiate the discussions providing job details. However this method lacks accuracy.

Diary Methods: In this method jobholder is required to note down their activities day by day in their diary. If done faithfully this technique is accurate and eliminates errors caused by memory lapses etc.

Quantitative Methods of Job Data Collection: -

Position Analysis Questionnaire (PAQ): -

PAQ is a highly specialized instrument for analyzing any job in terms of employee activities. The PAQ contains 194 job elements on which job is created depending on the degree to which an element is present. These elements are grouped together into 6 categories.

1.                  U – Usability / Use of Job

2.                  I – Importance of Job

3.                  T – Time

4.                  P – Possibility of Occurrence of Job

5.                  A – Applicability of Job

6.                  S – Specialty Tasks of Job

The primary advantage of PAQ is that it can be used to analyze almost every job. This analysis provides a comparison of a specific job with other job classifications, particularly for selection and remuneration purposes. However PAQ needs to be completed by trained job analysts only rather than incumbents.

Management Position Description Questionnaire (MPDQ): -

Highly structured questionnaire, containing 208 elements relating to managerial responsibilities, demand, restrictions and other position characteristics These 208 elements are grouped under 13 categories.

PAQ and MPDQ yield standardized information about the worker and the job.

Functional Job Analysis: -

It is a worker oriented job analytical approach, which attempts to describe the whole person on the job.

BARRIERS OF JOB ANALYSIS

·         Support from Top Management

·         Single means and source, reliance on single method rather than combination

·         No Training or Motivation to Jobholders

·         Activities and Data may be Distorted

SUCCESSION PLANNING & CAREER PLANNING

Meaning of Succession Planning

Succession planning is the process or activities connected with the succession of persons to fill key positions in the organization hierarchy as vacancies arise. The focus of attention is towards ‘which’ person the succession planning is needed. The focus is not more on career development but it is more towards what kind of person is required to fill the future vacancy. Succession planning focuses on identification of vacancies and locating the probable successor. For example in succession planning the key concern can be who will be next CEO or what will happen if the Marketing Manager retires in coming March.

Importance of Succession Planning

·           Succession planning helps when there is a sudden need arises due to reason or retirement of a key employee.

·           Individual employee comes to know in advance the level to which he can rise if he has the ability and aptitude for it.

·           Individual employee or successor feels happy when he feels that organization is taking care of his talents and aspirations.

·           Succession planning helps create loyalty towards the organization and improved motivation and morale of individual employees.

·           Organization gains stable workforce and low employee turnover.

·           Ultimately organization becomes successful in accomplishing its goals effectively.

CAREER PLANNING

Career planning is the process or activities offered by the organization to individuals to identify strengths, weaknesses, specific goals and jobs they would like to occupy.

Career as a concept means a lifelong sequences of professional, educational and developmental experiences that projects an individual through the world of work. It is a sequence of positions occupied by a person during his life. Career may also be defined as amalgamation of changes in values, attitudes and motivation that occurs as a person grows older.

In career planning, organization is concerned with strategic questions of career development. Further the organization is concerned about if it should employ more graduates, more engineers, more scientists or more accountants etc. Career planning provides picture of succession plan for employees as per organizational needs. It focuses on the basis of performance, experience, could be placed where, when and how.

Career planning is a process of integrating the employees’ needs and aspirations with organizational requirements.

Objectives of Career Planning

1.      Build commitment in the individual

2.      Develop long-range perspective

3.      Reduce personal turnover expenses

4.      Lessen employee obsolescence

5.      Ensure organizational effectiveness

6.      Allow individual to achieve personal and work related goals.

Importance of Career Planning

Career planning is important because it helps the individual to explore, choose and strive to derive satisfaction with his own career objectives.

HRP SYSTEM

HRP System as such includes following elements or sets for planning

        Overall Organization Objectives

        Business Environment

        Forecasting Manpower Needs

        Assessing Manpower Supply

        Matching Manpower Demand-Supply factors

Based on these elements we can draw “HRP System Architecture” as under.

 HRP PROCESS

Organizational Objectives & Policies: -

The objectives of HR plan must be derived from organizational objectives like specific requirements of numbers and characteristics of employees etc. HRP needs to sub-serve the overall objectives by ensuring availability and utilization of human resources. Specific policies need to be formulated to address the following decisions.

·         Internal Hiring or External Hiring?

·         Training & Development plans

·         Union Constraints

·         Job enrichment issues

·         Rightsizing organization

·         Automation needs

·         Continuous availability of adaptive and flexible workforce

Manpower Demand Forecasting: -

It is the process of estimating the future quantity and quality of people required.

The basis should be annual budget and long term corporate plans

Demand forecasting should be based on following factors.

Internal Factors: -

·                     Budget constraints

·                     Production levels

·                     New products and services

·                     Organizational structure

·                     Employee separation

External Factors: -

·                     Competition environment

·                     Economic climate

·                     Laws and regulatory bodies

·                     Technology changes

·                     Social Factors

Reasons for Manpower Demand Forecasting: -

·                     To quantify jobs

·                     To determine the Staff-mix

·                     To assess staffing levels and avoid unnecessary costs

·                     Prevent shortages of people

·                     Monitor compliances of legal requirements with regards to reservations

Manpower Forecasting Techniques: -

Management Judgment: In this techniques managers across all the levels decide the forecast on their own judgment. This can be bottom-up or top-down approach and judgments can be reviewed across departments, divisions and top management can conclude on final numbers of manpower required.

Ration-Trend Analysis: This technique involves studying past ratios, and forecasting future ratios making some allowance for changes in the organization or its methods.

Work Study Techniques: It is possible when work measurement to calculate the length of operations and the amount of manpower required. The starting point can be production budget, followed by standard hours, output per hour; man-hours required etc could be computed.

Delphi Techniques: This technique solicits estimates from a group of experts, and HRP experts normally act as intermediaries, summarizes various responses and report the findings back to experts.

Flow Models: This technique involves the flow of following components. Determine the time required, Establish categories, Count annual movements, Estimate probable transitions. Here demand is a function of replacing those who make a transition.

Manpower Supply Forecasting: -

This process measures the number of people likely to be available from within and outside the organization after making allowance for absenteeism, internal movements and promotions, wastages, changes in hours and other conditions of work.

Reasons for Manpower Supply Forecasting:

·                     Clarify Staff-mixes exist in the future

·                     Assess existing staff levels

·                     Prevent shortages

·                     Monitor expected future compliance of legal requirements of job reservations

Supply Analysis covers:

Existing Human Resources: HR Audits facilitate analysis of existing employees with skills and abilities. The existing employees can be categorized as skills inventories (non-managers) and managerial inventories (managers)

Skill inventory would include the following;

·                     Personal data

·                     Skills

·                     Special Qualifications

·                     Salary

·                     Job History

·                     Company data

·                     Capabilities

·                     Special preferences

Management inventories would include the following

·         Work History

·         Strengths

·         Weaknesses

·         Promotion Potential

·         Career Goals

·         Personal Data

·         Number and Types of Subordinates

·         Total Budget Managed

·         Previous Management Duties

Internal Supply: -

Internal supply techniques help to assess the following

·                     Inflows and outflows (transfers, promotions, separations, resignations, retirements etc.)

·                     Turnover rate (No. Of separations p.a. / Average employees p.a. X 100)

·                     Conditions of work (working hours, overtime, etc.)

·                     Absenteeism (leaves, absences)

·                     Productivity level

·                     Job movements (Job rotations or cross functional utilizations)

External Supply: -

External sources are required for following reasons

·                     New blood,

·                     New experiences

·                     Replenish lost personnel

·                     Organizational growth

·                     Diversification

External sources can be colleges and universities, consultants, competitors and unsolicited applications.

HR Plan Implementation: -

A series of action programs are initiated as a part of HR plan implementation as under.

Recruitment & Selection: Employees are hired against the job vacancies. Based on the manpower demand and supply forecasts made, hiring of employees is initiated based on supply forecasts. For this internal and external sources of manpower are utilized. A formal selection board is established to interview and select the best of the candidates for the required vacancies. Finally the selected employees also need to be placed on proper jobs. Here some companies recruit employees for specific jobs while others recruit fresh trainees in large number and train them for future manpower needs.

Training and Development: The training and development program is charted out to cover the number of trainees, existing staff etc. The programs also cover the identification of resource personnel for conducting development program, frequency of training and development programs and budget allocation.

Retraining and Redeployment; New skills are to be imparted to existing staff when technology changes or product line discontinued. Employees need to be redeployed to other departments where they could be gainfully employed.

Retention Plan: Retention plans cover actions, which would reduce avoidable separations of employees. Using compensation plans, performance appraisals, avoiding conflicts, providing green pastures etc, can do this.

Downsizing plans: Where there is surplus workforce trimming of labor force will be necessary. For these identifying and managing redundancies is very essential.

Managerial Succession Planning; Methods of managerial succession plans may vary. Most successful programs seem to include top managements involvement and commitment, high-level review of succession plans, formal performance assessment and potential assessment and written development plans for individuals. A typical succession planning involves following activities.

·                     Analysis of demand for managers and professionals

·                     Audit of existing executives

·                     Projection of future likely supply from internal and external sources

·                     Individual career path planning

·                     Career counseling

·                     Accelerated promotions

·                     Performance related training and development

·                     Strategic recruitment

Control & Evaluation of HRP: -

HR Plan must also clarify responsibilities for control and establish reporting procedures, which will enable achievements to be monitored against the plan. The HR Plan should include budgets, targets and standards. These plans may simply be reports on the numbers employed, recruited against targets etc.