#HR #Word:#Opportunistic #Manager

Opportunistic Managers are those managers who have self-serving bias and do some things favorable to their own interest instead of company’s interest

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Managers in a company are generally well aware of the company’s operations and investments, in case of investment firms. So, whenever they get chance to multiply their wealth or have any kind of personal profit, they forget company’s interest and objectives.

Opportunistic managers either benefit themselves or their relatives/friends from inside information of the company.

    Managers serving their own interest is a common agency-principle problem. In agency-principal businesses, managers are the agents and owner is the principal. The job of the managers is to multiple owner’s wealth but many times the managers could not align themselves with the principal’s interest and focus on multiplying their own wealth instead. This generally happens if owner does not participate in managers’ performance evaluations or regulations. No monitoring or avoidance can lead to loss of business.

    This problem can be tackled by ways like:

    1. Sharing profit with employees: If the profit is earned by managers’ work and it is shared as per profit margins to the managers, it will keep them motivated to work more in company’s interest. Managers would think to increase company’s wealth if it would have direct impact in their salary.

    2.Monitoring of managers’ work: Monitoring of mangers’ or agents’ work can create questions on decisions taken more for self-interest than company’s interest by the managers or agents respectively. The fear of being caught can restrict them from doing so. Hence, owner or board of directors or whoever is the lead holder of the business should monitor managers time to time.

    Example of Opportunistic managers:

    A manager is named as Mr. John and working in company X. This the end of financial year and evaluations of earrings and profit is going on in company X. The more profit a unit has earned, the more hike the manager of that unit would get. Mr. John twist the numbers in the financial report of his unit just to earn get hike, although it is misleading for the company.

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    Posted by on October 24, 2017 in HR Word of The Day


    #HR #Word:#Operant #Conditioning

    Operating conditioning is a type of learning coined by BF Skinner that is based on the premise that learning occurs through consequences of their actions.

    Image Credit: Reference for Business

     A desirable behaviour can be enhanced or repeated through positive reinforcement whereas unwanted behaviour can be eliminated through punishment. 

    BF Skinner tested this theory using a lab rat that was put into a cage. By pressing a lever in the cage the rat would receive a treat.

    Once the rat had learnt the purpose of the lever, it would directly reach for the lever when put into the cage. This portrayed that positive reinforcement could help develop repeated behavior. Later another rat was put into a different cage. The second cage however was built to give a small electric shock when the lever was pushed. When the rat learnt of the punishment it did not repeat the behaviour of pressing the lever again.

    The advantage of using operant conditioning is that organizations can motivate their employees through positive reinforcements. This could include incentive, bonuses and other benefits linked to the performance of the individual. Similarly they can also control undesired behaviour through punishment such as demotion, although most successful organizations use the former.

    A Disadvantage however is that motivation is only gained through external factors such as a bonus. When the organization stops giving bonuses the desired behaviour will also eventually stop. Therefore Operant conditioning is not a permanent motivator.

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    Posted by on October 23, 2017 in HR Word of The Day


    #HR #Word:#Open #Book #Management (#OBM)

    Open Book Management (OBM) is a philosophy wherein a company shares all its financial and operational information (critical data) with all the employees and expects them to align themselves with company’s goals such that the overall performance of the organization is enhanced

    This way, the employee considers himself as a company’s stakeholder rather than just a ‘hired worker’, and hence takes the responsibility to drive the company towards its goals.

    It involves following steps:

    –          Training the employees to understand company’s financial and operational data

    –          Sharing all the information with the employees to maintain transparency

    –          Empowering them to use the information to build company’s growth prospects

    –          Treating them as business partners and sharing profits as well as the risk for losses


    Springfield Remanufacturing Corp (SRC), a US based company initially incurred losses of $61000 on revenue of $16 million. The management then decided to share all the company’s information with all the employees, which in turn, made the employees realize what needs to be done in such a crisis. With the implementation of OBM, the company went on to make profits of $12 million a year on the revenue of $160 million.

    Allstate’s Business Group saw its return-on-equity rise from 2.9% to 16.5% in three years after the implementation of OBM

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    Posted by on October 22, 2017 in HR Word of The Day


    #HR #Word:#Observation #Interview

    Observation interview is defined as the process of observing certain employees in a firm while they are performing their respective jobs and tasks given at a certain time, these observations are then utilized to gather data regarding specific jobs and tasks.

    Image Credit : Constant Credit

    There is different type of observation interviews: –

    1.Direct (Reactive) Observation

    During direct observation the interviewer knows that somebody is watching and evaluating his/her performance. There are two types of direct observations.

    1. Continuous Monitoring- as the name suggests it requires continuous monitoring through behavior or body language of the individual.
    2. Time Allocation- It allows a researcher to randomly allocate selecting a place and certain time

    2. Unobtrusive Observation 

    Unobtrusive observation involves certain methods and ways for studying behavior of an individual where the individual does not know that he/she is being observed during the interview. This only problem with this method is that standardization needs to be maintained during each interview conducted for all the individuals to ensure fairness and transparency.

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    Posted by on October 21, 2017 in HR Word of The Day


    #Cognitive #Biases That #Impact #Decision #Process

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    Posted by on October 17, 2017 in Being HR


    #HR #Word:#OKR (#Objectives & #Key #Result)

    Objectives and Key Results (OKR) is a framework used to define an organization’s objectives and then the key results which can measure those objectives.

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    The main objective of OKR is to make sure that the employees or the team members are aligned and they work towards a clear objective which is defined.

    Objective can be a company level, a team level or an Individual level

    The key results are also then defined accordingly.

     OKRs are mainly public in nature within an organization so that each individual, team and management is aware about what they are doing and what others are doing.

    The frequency of OKRs can be yearly, quarterly etc. Also OKR are not entirely rigid. If the company focus or team focus changes midway the OKR can be modified to align to new company vision. 

    The goal is not to complete all objectives with each key result fully. The goal is keep team focussed and moving in the right direction. A realistic target can be set though.

    OKR was started in Intel and is today one of the popular methods of team alignment

    OKRs are reviewed regularly and presented to the stakeholders so that everyone is in sync regarding their own OKRs.

    OKR Format

    OKR can be defined with clarity. Each OKR should have clear objective and then clearly defined and measurable key results with it. These objectives and key results should be practical, quantifiable and with clear timelines.

    For OKR format Search on Google

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    Posted by on October 15, 2017 in HR Word of The Day


    #HR #Word:#Non #Directive #Interview

    Nondirective interview is an interview in which questions are not prearranged.

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     Unstructured or Nondirective interviews generally have no set format. The lack of structure allows the interviewer to ask questions which comes to their mind next as a follow up and interrogate points of interest as they go on further.

    Nondirective Interview is a type of Interview schedule. Interview schedule is a one to one direct communication between researcher and subject for collection of data. In it series of a questions to be asked in an interview is called interview schedule. Non-directive interviews, there is free talk on issues.

    They tend to be more open ended, informal, free flowing and flexible.

     Questions are not pre-set, although there might be some topics that the researchers wish to explore. This gives the interview some structure and direction.

     An unstructured interview is thus an interview which has no any set format but in which the interviewer might have some key questions formed in advance. Unstructured interviews proceed in such a manner – questions based on an interviewee’s responses are interrogated further and proceeds like a friendly conversation.

    Characteristics of non-directive interview are: –


    Conversational style interview.

    • No particular structure, the interviewer asks questions as they come to mind.

    • No scoring of answers


    • Encourages maturity.

    • Encourages open communication.

    • Develops personal responsibility


    • There would be the possibility of verbally wandering off the subject,

    • sharing of irrelevant information too much, and/or may lead to unnecessary results such as in the interviewee not including specific information the interviewer wants/needs to know.

    • Non-directive interviews generally take much longer time to complete than a structured (directive) interview.

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