HUMAN RESOURCE MANAGEMNT

3 RD MODULE-CONCEPT OF HRM

Organizations are made-up of people and function through people. Without People organizations cannot exist. The resources of men,money,materials are collected, coordinated and utilized through people. People are the most significant resource of any organization. HRM is utilization of individuals to achieve organizational objectives.

HRM is a process of bringing people and organizations together so that the goals of each are met. It is that part of the management process which is concerned with the management of human resources is an organization. Definition:- According to Leon C. Megginson,The term human resources can be defined as the process of total knowledge,skills,creative abilities, talents and aptitudes of an organizations workforce, as well as the value, attitudes and beliefs of the individuals involved. Milkovich and Boudreau,Human resource management is a series of integrated decisions that from the employment relationship; their quality contributes to the ability of the organizations and the employees to achieve their objectives. Byars and Rue, Hrm encompasses those activities that are designed to provide for and Co-ordinate the human resources of an organization.

Pervasive force: HRM is pervasive in nature. It is present in all enterprise. It permeates all levels of management in an organization. Action Oriented: HRM focuses attention on action, rather than on record keeping, written procedures or rules. Individually Oriented: It tries to help employees develop their potential fully. It encourages them to give their best to the organization. People Oriented:-Hrm is all about people at work, both as individuals and groups. It tries to put people and motivate them toward further improvements in productivity. Future Oriented:-Effective hrm prepares people for current as well as future challenges, especially working in an environment characterized by dramatic change. Development Oriented:-Hrm intends to develop the full potential of employees. The reward structure is turned to the needs of employees.

Integrating mechanism: Hrm tries to build and maintain cordial relations between people working at various levels in the organization. Comprehensive function: Hrm is, to some extent, concerned with any organization decision which has an impact on the workforce or the potential workforce. Interdisciplinary function: Hrm is multi-disciplinary activity, utilizing knowledge and inputs drawn from psychology,sociology,anthropology,economics, etc Continuous function: According to Terry, Hrm is not a one shot deal. It cannot be practiced only one hour each day or one day a week.

Personnel aspect:-This is concerned with manpower planning,recruitment,selection,placement,transfer,pr omotion,training and development ,remuneration, incentive etc. Welfare aspect:-It deals with working conditions and amenities such as canteens,creches,rest and lunch rooms etc. Industrial relations aspect:-This covers unionmanagement relations, joint consultation, collective bargaining, grievance and disciplinary procedures etc.

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To help the organization to reach its goals. To employ the skills and abilities of the workforce efficiently. To provide the organization with well-trained and well-motivated employees. To increase to the fullest the employees job satisfaction and self-actualization. To develop and maintain a quality of work life. To communicate HR Policies to all employees To be ethically and socially responsive to the needs of society.

At the Enterprise level: a. Good human resource practices can help in attracting and retaining the best people in the organization. b. It helps in training people for challenging roles, developing right attitudes towards the job and the company, developing loyalty and commitment through appropriate reward scheme. 2. At the individual level: a. It promotes team work and team spirit among employees. b. It offers excellent growth opportunities to people who have the potential to rise. c. It allows people to work with diligence and commitment.
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At the Society level: a. Employment opportunities multiply. b. Scare talents are put to best use.
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4. At National level: Effective use of human resources helps in exploitation of natural, physical and financial resources in a better way.

HRM FUNCTION

MANAGERIAL FUNCTION

OPERATIVE FUNCTION

PROCUREMENT PLANNING DEVELOPMENT ORGANIZING

MOTIVATION AND COMPENSATION

DIRECTING
CONTROLLING

MAINTENANCE INTEGRATIOIN
EMERGING ISSUES

PLANNING

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ORGANIZING
DIRECTING

CONTROLLING

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Procurement Job analysis Human resource planning Recruitment Selection Placement Induction and orientation Internal mobility Development Training Executive development Career planning and development Human resource development

3. Motivation and Compensation Job design Work Scheduling Motivation Job evaluation Performance appraisal Compensation administration Incentives and benefits

4. Maintenance Health and Safety Employee welfare Social security measures

5.Integration function Grievance redressal Discipline Teams and teamwork Collective bargaining Employee participation and empowerment Trade unions and employee association Industrial relations
6. Emerging Issues Personnel records Human resource audit Human resource research Human resource information system Stress and counseling International human resource management

The Normative Perspective of Human Resource Management The normative perspective of human resource management bases itself on the concepts of hard HRM and soft HRM, on which the foundations of human resource management rest. The concept of Hard HRM is the basis for the traditional approach toward human resource management. This concept traces its origins to the Harvard model that links workforce management to organizational strategy. Hard HRM stresses the linkage of functional areas such as manpower planning, job analysis, recruitment, compensation and benefits, performance evaluations, contract negotiations, and labor legislations to corporate strategy. This enforces organization interests over the employees' conflicting ambitions and interests. It views the workforce as passive resources that the organization can use and dispose at will. Soft HRM is synonymous with the Michigan model of human resources and is the bedrock of the modern approach to strategic human resource management. This model considers human capital as assets rather than resources and lays stress on organizational development, conflict management, leadership development, organizational culture, and relationship building as a means of increasing trust and ensuring performance through collaboration. This approach works under the assumption that what is good for the organization is also good for the employee.

The Critical Perspective of Human Resource Management The critical perspective of human resource management is a reaction against the normative perception. This highlights some inherent contradictions within the normative perspective. This perspective espouses a gap between rhetoric, as organizations claim to follow soft HRM policies when they actually enforce hard HRM. A study by Hope-Hailey et al. (1997) finds that while most organizations claim employees to be their most important assets and make many commitments for their welfare and development, in reality employers enforce a hard HRM-based strategic control, and the interests of the organization always take priority over the individual employee. The Behavioral Perspective of Human Resource Management The behavioral perspective of human resource management has its roots in the contingency theory that considers employee behavior as the mediator between strategy and organizational performance. This theory holds that the purpose of human resource intervention is to control employee attitudes and behaviors to suit the various strategies adopted to attain the desired performance. This perspective thus bases itself on the role behavior of employees instead of their skills, knowledge, and abilities. For instance, an organization aiming to innovate will require a workforce that demonstrates a high degree of innovative behavior such as long-term focus, cooperation, concern for quality, creativity, propensity for risk taking, and similar qualities. The role of human resource management in such a context is to inculcate and reinforce such behavioral patterns in the workforce.

The Systems Perspective of Human Resource Management The systems perspective describes an organization in terms of input, throughput, and output, with all these systems involved in transactions with a surrounding environment. The organized activities of employees constitute the input, the transformation of energies within the system at throughput, and the resulting product or service the output. A negative feedback loop provides communications on discrepancies. The role of human resource management in the systems perspective is Competence management to ensure that the workforce has the required competencies such as skills and ability to provide the input needed by the organization. Behavior management through performance evaluation, pay systems, and other methods to ensure job satisfaction, so that employees work according to the organizational strategy, ultimately boosting productivity. Setting up mechanisms to buffer the technological core from the environment in closed systems. Facilitating interactions with the environment in open systems.

Agency or Transaction Cost Perspective of Human Resource Management Among the different perspectives of human resource management is the agency or transaction cost perspective, which holds the view that the strong natural inclination of people working in groups is to reduce their performance and rely on the efforts of others in the group. When one person delegates responsibility to another person, conflicts of interests invariably arise. The major role of human resource management in such a context is to promote alternative ways of controlling behavior to reduce the effects of such conflicts and minimize the cost to the organization. The two major approaches include Monitoring employee behavior and preventing shrink of work by establishing effective control systems and improving productivity. Providing employees with incentives such as rewards, motivation, and job satisfaction to increase their individual performance. The human resource department needs to adopt the approach that minimizes transaction cost to the organization.

SHRM is built among three important propositions: The human resources of a firm are a major source of competitive advantage; in a way, people can make or break an organization. Successful organization performance depends on a close fit between business and human resource strategy. Individual HR Strategy should cohere by being linked to each other to offer mutual support. HRs Role in strategy formulation: HR can play a vital role, especially in identifying and analyzing external threats and opportunities. HR can also offer competitive intelligence (like new incentive plans being used by competitors, data regarding customer complaints etc) HR can also throw light on companys internal strengths and weakness.

EXTERNAL ENVIRONMENT COMPETITION GOVERNMENT POLICY TECHNOLOGY MARKET TRENDS ECONOMIC FACTORS

LAWS REGULATING EMPLOYMENT

CORPORATE STRATEGY

BUSINESS STRATEGY

HR STRATEGY HR PLANNING DESIGNS OF JOBS AND WORK SYSTEMS WHAT WORKERS DO WHAT WORKERS NEED HOW JOBS INTERFACE WITH OTHERS

INTERNAL ENVIRONMENT CULTURE STRUCTURE POLICIES SKILLS PAST STRATEGY

HR INFORMATION SYSTEM

PROCUREME NT DEVELOPME NT PERFORMAN CE MANAGEMEN T COMPENSAT ION LABOUR RELATIONS

OUTCOMES INCREASED PERFORMACE CUSTOMER SATISFACTION EMPLOYEE SATISFACTION ENHANCED SHAREHOLDER VALUE

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