HUMAN RESOURCE MANAGEMENT

INDEX
SL
1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22. 23. 24. 25.

SUBJECT
HUMAN RESOURCE MANAGEMENT ( H R M ) STRATEGIC HUMAN RESOURCE MANAGEMENT HUMAN RESOURCE DEVELOPMENT TEAM EFFECTIVENESS HUMAN RESOURCE PLANNING ( H R P ) JOB ANALYSIS JOB DESCRIPTION JOB SPECIFICATION JOB EVALUATION JOB DESIGN JOB SATISFACTION WORK SAMPLING RECRUITMENT SELECTION TRAINING & DEVELOPMENT INDUCTION & ORIENATION MULTI-SKILLING CHANGE MANAGEMENT PERFORMANCE APPRAISALS HUMAN RESOURCE AUDIT MOTIVATION THEORIES MORALE PERSONNEL POLICIES UNIONS ORGANIZATIONAL DOWNSIZING

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3 9 11 13 14 20 21 22 23 25 28 28 31 35 38 44 47 49 56 62 64 67 68 71 73

WHAT IS HRM?

MEANING OF HRM
HRM is a management function that helps organisation to recruit, select, train, develop and manage its members. Simply stated, HRM is all about management of people in the organisation from Recruitment to Retirement. HRM refers to set of programs, functions, and activities designed and carried out in order to maximise both employee as well as organisational effectiveness. Definition 1 HRM is planning, organizing, directing and controlling of the procurement, development, compensation, integration, maintenance and separation of human resources to the end that individual, organizational and social objectives are accomplished. Definition 2 HRM is concerned with the people dimensions in management. Since every organization is made up of people, acquiring their services, developing their skills, motivating them to higher levels of performance and ensuring that they continue to maintain their commitment to the organization are essential to achieving organizational objectives. This is true, regardless of the type of the organization government, business, education, health, recreational, or social action.

OBJECTIVES OF HRM
1. Organizational Objectives : To assist the organization to achieve its primary objectives, whether it is profit making or charity or social agenda. 2. Societal Objectives: To be responsive to the needs and challenges of the society while minimizing the negative impact, if any, of such demands upon the organization. 3. Functional Objectives : To maintain departments contribution and level of services at a level appropriate to the organizations needs. 4. Personal Objectives: To assist employees in achieving their personal goals, at least in so far as these goals enhance the individuals contribution to the organization. This is necessary to maintain employee performance and satisfaction for the purpose of maintaining, retaining and motivating the employees in the organization.

SCOPE OF HRM

From Entry to Exit or Recruitment to Retirement of an employee in the organization Following are the areas of operation of HRM: 1. Human Resource Planning 2. Job Analysis 3. Job Design 4. Recruitment & Selection 5. Orientation & Placement 6. Training & Development 7. Performance Appraisals 8. Job Evaluation 9. Employee and Executive Remuneration 10. Motivation 11. Communication 12. Welfare 13. Safety & Health 14. Industrial Relations Based on the above activities, we can summarize the scope of HRM into following seven different categories: 1. Introduction to HRM 2. Employee Hiring 3. Employee and Executive Remuneration 4. Employee Motivation 5. Employee Maintenance 6. Industrial Relations 7. Prospects of HRM

ROLE OF HRM
1. Advisory Role: HRM advises management on the solutions to any problems affecting people, personnel policies and procedures. (a) Personnel Policies: Organization Structure, Social Responsibility, Employment Terms & Conditions, Compensation, Career & Promotion, Training & Development and Industrial Relations. Personnel Procedures: Relating to manpower planning procedures, recruitment and selection procedures, and employment procedures, training procedures, management development procedures, performance appraisal procedures, compensation procedures, industrial relations procedures and health and safety procedures.

(b)

2.

Functional Role: The personnel function formulates personnel policies in accordance with the companys doctrine and management guidelines. It provides guidance to managers to help them ensure that agreed policies are implemented. Service Role: Personnel function provides personnel services. These services constitute the main activities carried out by personnel department, like payroll, disciplinary actions, etc, and involve the implementation of the policies and procedures described above.

3.

ROLE OF HR MANAGERS
1. Humanitarian Role: Reminding moral and ethical obligations to employees. 2. Counsellor: Consultations to employees about marital, health, mental, physical and career problems. 3. Mediator: Playing the role of a peacemaker during disputes, conflicts between individuals and groups or management. 4. Spokesman: To represent the company in Media and other forums because he has better overall picture of his companys operations. 5. Problem Solver: Solving problems of overall human resource management and long-term organizational planning. 6. Change Agent: Introducing and implementing institutional changes and installing organizational development programs 7. Management of Manpower Resources: Broadly concerned with leadership both in the group and individual relationships and labour-management relations.

OBJECTIVES V/s FUNCTIONS OF HRM

HRM Objectives Social Objectives (3) (a) (b) (c) (a) (b) (c) (d) (e) (f) (g) (a) (b) (c) (a) (b) (c) (d) (e) Supporting HRM Functions Legal Compliance Benefits Union Management Relations Human Resource Planning Employee Relations Recruitment & Selection Training & Development Performance Appraisals Placement & Orientation Employee Assessment Performance Appraisals Placement & Orientation Employee Assessment Training & Development Performance Appraisals Placement & Orientation Compensation Employee Assessment

Organizational Objectives (7)

Functional Objectives (3)

Personal Objectives (5)

MANAGERIAL FUNCTIONS OF HRM

1. Planning: Research and plan about wage trends, labour market conditions, union demands and other personnel benefits. Forecasting manpower needs etc. 2. Organizing: Organizing manpower for the achievement of organizational goals and objectives. 3. Staffing: Recruitment & Selection 4. Directing: Issuance of orders and instructions, providing guidance and motivation to managers and employees. 5. Controlling: Regulating personnel activities and policies according to plans. Observations and comparisons of deviations

OPERATIONAL FUNCTIONS OF HRM

1. Procurement: 2. Development: Planning, Recruitment and Selection, Induction and Placement Training, Development, Career planning and counselling.

3. Compensation: 4. Integration:

Wage and Salary determination and administration

Integration of human resources with organization.

5. Maintenance: Sustaining and improving working conditions, retentions, employee communication 6. Separations: Managing separations caused by resignations, terminations, lay offs, death, medical sickness etc.

CHALLENGES OF HRM IN INDIAN ECONOMY

The job of HRM department in India has never been so challenging. Last decade has witnessed tectonic shift in Job market. From being an employers market, it has suddenly turned into employees market, especially in the most crucial segment, ie middle management. Globalisation and Indias growing stature in the world has seen demand for Indian managers soaring. From the state of plenty, there is a stage of scarcity of the right talent. The biggest challenge is to retain the talent one has so assiduously hunted and trained. The attrition rate has reached alarming proportions. It has reached such proportions that certain segments of Industry are maintaining bench strengths to fill in the sudden gaps due to resignations. In addition, there are following new issues: 1. Globalization: Growing internationalization of business and workforce has its impact on HRM in terms of problems of unfamiliar laws, languages, practices, attitudes, management styles, work ethics and more. HR managers have a challenge to deal with more and more heterogeneous functions and more involvement in employees personal life. 2. Corporate Re-organizations: Liberalisation has led to largescale reorganization of businesses in terms of expansions, mergers and acquisitions, joint ventures, take overs, and internal restructuring of organizations. In circumstances as dynamic and as uncertain as these, it is a challenge to manage employees anxiety, uncertainties, insecurities and fears. 3. New Organizational Forms: Exposure to international business and practices have led to change in the organisational structure and HR policies of the local companies. Take for instance, the hierarchical structure of Indian companies. Suddenly, Indian companies have begun to adopt flat hierarchical management structure. But to implement and grout such fundamental changes in management philosophy of any company is never easy. The challenge for HRM is to cope with the implications of these new relations in place of well established hierarchical relationships that existed within the organizations for ages in the past. 4. Changing Demographics of Workforce: Changes in workforce are largely reflected by dual career couples, large chunk of young blood with contrasting ethos of work among old superannuating employees, growing number of women in workforce,

working mothers, more educated and aware workers etc. Thus, changing demography of workforce has its own implications for HR managers and a true challenge to handle. 5. Changed Employee Expectations: With the changes in workforce demographics, employee expectations and attitudes have also transformed. Traditional allurements like job security, house, and remunerations are not much attractive today. Rather, employees are demanding empowerment and equality with management. Hence, it is a challenge for HRM to redesign the profile of workers, and discover new methods of hiring, training, remunerating and motivating employees. 6. New Industrial Relations Approach: In the changed industrial climate, even trade unions have realised that strikes and militancy have lost their relevance and not many workers are willing to join them and disrupt work. However, the problems faced by workforce now have different dimension for the management. They manifest in the form of increased attrition rate. Unsatisfied employees instead of approaching the management for resolution, often take up the new job. The challenge before the HRM is find ways and means to feel the pulse of employees and address the issues on proactive basis. 7. Renewed People Focus: Man behind the machine is most important than the machine. This is an old doctrine of the Armed Forces. However, this doctrine has begun to gain acceptance in the corporate world and thus all out efforts to grab the best talent at what ever cost. 8. Managing the Managers: Managing the managers is most difficult. Armed with inside information, they can not be lured with rosy promises. They are in great demand too with growth in economy. These are the people who are most mobile, attrition rate being highest for the junior and middle management level. The challenge of HRM is how to manage this tribe? 9. Weaker Sections Interests: Another challenge for HRM is to protect the interest of weaker sections of society. The dramatic increase of women workers, minorities and other backward communities in the workforce, coupled with weakening of trade unions, has resulted in the need for organizations to re-examine their policies, practices and values. In the name of global competition, productivity and quality, the interests of the society around should not be sacrificed. It is a challenge of todays HR managers to see that these weaker sections are neither denied their rightful jobs nor are discriminated while in service. 10. Contribution to the Success of Organizations: The biggest challenge to an HR manager is to make all employees contribute to the success of the organization in an ethical and socially responsible way. Because societys well being to a large extent depends on its organizations.

STRATEGIC HUMAN RESOURCE MANAGEMENT

Strategy: Strategy is a way of doing something. It includes the formulation of goals and setting of action plans for accomplishment of that goal. Strategic Management: A Process of formulating, implementing and evaluating business strategies to achieve organizational objectives is called Strategic Management Definition of Strategic Management Strategic Management is that set of managerial decisions and actions that determine the long-term performance of a corporation. It includes environmental scanning, strategy formulation, strategy implementation, evaluation and control. The study of strategic management therefore emphasizes monitoring and evaluating environmental opportunities and threats in the light of a corporations strengths and weaknesses.

STEPS IN STRATEGIC MANAGEMENT

1. Environmental Scanning: Analyze the Opportunities and Threats in External Environment 2. Strategy Formulation: Formulate Strategies to match Strengths and Weaknesses. It can be done at Corporate level, Business Unit Level and Functional Level. 3. Strategy Implementation: Implement the Strategies 4. Evaluation & Control: Ensure the organizational objectives are met.

IMPORTANCE & BENEFITS OF STRATEGIC MANAGEMENT

1. Allows identification, prioritization and exploration of opportunities. 2. Provides an objective view of management problems. 3. Represents framework for improved co-ordination and control 4. Minimizes the effects of adverse conditions and changes 5. Allows major decisions to better support established objectives 6. Allows more effective allocation of time and resources 7. Avoids ad hoc decisions

8. Helps to integrate the individual behaviours 9. Encourages forward thinking 10. Encourages favourable attitude towards change.

ROLE OF HRM IN STRATEGIC MANAGEMENT

Role in Strategy Formulation: HRM is in a unique position to supply competitive intelligence that may be useful in strategy formulation. Details regarding advanced incentive plans used by competitors, opinion survey data from employees, elicit information about customer complaints, information about pending legislation etc. can be provided by HRM. Unique HR capabilities serve as a driving force in strategy formulation. Role in Strategy Implementation: HR Manager helps strategy implementation by supplying competent people. Additionally, HRM facilitates strategy implementation by encouraging proactive thinking, communicating goals and improving productivity and quality.

HUMAN RESOURCE DEVELOPMENT

Human Resource Development is a process to help people to acquire competencies and to increase their knowledge, skills and capabilities for better performance and higher productivity. Definition 1: HRD is a process of enhancing the physical, mental and emotional capacities of individuals for productive work. Definition 2: HRD means to bring about the possibility of performance improvement and individual growth.

PROACTIVE HRD STRATEGIES FOR LONG TERM PLANNING AND GROWTH

Like quoted earlier, employee retention has become bigger challenge than employee hiring today. With trade unions breathing their last, and easy job availability, employees have developed propensity to switch jobs for minor reasons without voicing their protest. Thus, HRD has to take a proactive approach, that is, to seek preventive care in human relations. By using HRD strategies, maximization of efficiency and productivity could be achieved through qualitative growth of people. Long-term growth can also be planned by creating highly inspired groups of employees with high aspirations to diversify around core competencies and to build new organizational responses for coping with change. A proactive HRD strategy can implement plans directed at improving personal competence and productive potentials of human resources. Following strategic choices can be considered which would help todays organizations to survive and grow. Change Management: Manage change properly and become an effective change agent rather than being a victim of change itself. Values: Adopt proactive HRD measures, which encourage values of trust, autonomy, proactive approach and experimentation.

Maximize Productivity and Efficiency: Maximize productivity and efficiency of the organization by helping qualitative growth of people

TEAM EFFECTIVENESS
Definition: A team is a small group of people who agree to work together for achieving a clear and identifiable set of goals. Teams Can be Very Effective. The benefit of teams lie in Synergy which means The whole is greater than sum of its parts. Thus, a team is able to produce more than the sum of individuals working separately. A team benefits from complementing and some times contrasting abilities of its members. Teams can bring to bear a wider range of skills and experience to solve a problem. Teams often lead to better quality decisions as individual whims and prejudices are kept in check. Further, members of team have an obligation to each other and thus there is a moral force/binding to perform.

TEAM EFFECTIVENESS
For a team to be effective, following are the prerequisites: 1. Harmony and trust among the team members 2. Effective leadership 3. Shared goals 4. Diverse skills and experience - technical, problem solving and interpersonal skills 5. Creativity and risk taking ability 6. Freedom to voice views 7. Ability to self-correct 8. Interdependent work 9. Effective decision making process 10. Ability to resolve conflict 11. Clear communication channels

Synergy among the team members is very important. The team needs a clear sense of direction which the leader provides. Harmony and trust among the group members is utmost essential. In any group, conflicts are inevitable, how ever harmonious it may be. There has to be a well formulated policy for conflict management. Decision making is a source of potential conflicts. A well charted course for decision taking will be able to minimise such conflicts.

HUMAN RESOURCE PLANNING (H R P)

Human Resource Planning, as the name suggests, is the process of identification/ forecasting a firms future requirement of type and number of people in order to meet the organisational goals and objectives. It is a continuous process either due to fresh requirement of manpower owing to change/growth/diversification of business or due to attrition of manpower due to retirement, termination, death, disability or resignations. Definition 1: HRP includes estimation of how many qualified people are necessary to meet the future business requirement, how many people will be available, and what, if anything, must be done to ensure availability of personnel equals the demand at all times in the future. Definition 2: HRP is a Process, by which an organization ensures that it has the right number of right kind of people at the right place, at the right time, capable of effectively and efficiently completing those tasks that will help the organization achieve its overall objectives.

NEED & IMPORTANCE OF HRP

Human Resource comes at a cost and generates profits. While excess of human resource will lead to unproductive costs, shortages of same will lead to idling of other resources and impede profit generation. Having the people is not enough. Each job needs specific skills and experience and only a certain trained personnel can do it effectively. Therefore, it is necessary that right kinds of people are hired for each job. Personnel requirement is never static. Manpower wastages in the organisation keep taking place regularly due to retirement, injury, resignations, termination, etc. In addition, changes in the business environment, business model and plan, capacity/product changes, diversifications, etc, also generate need to review the human resource requirement of the organisation. Changes in the Business Environment in the past one and half decade have led to relative scarcity of talented people. Right kinds of people are no more available at short notice. There is considerable time gap between identifying the need for manpower and filling the

vacancy, some times stretching between 6 months to one year. Thus, it will help the company if the requirement is forecasted adequately in advance to enable hiring of right kind of personnel just in time so that neither the machines/other resource idle for want of manpower nor do the people idle. At the same time, there could be situations when there is spare manpower in the company. Company may have changed over to a new technology productions and therefore all personnel trained in old machines may have become redundant and surplus. The Exit Policy for workers is not easy and they can not be released at short notice. Re-training or retrenchment of personnel has to be planned in advance. In India services is growing at a fast pace. It has already overtaken agriculture and Industrial production sectors to become the biggest contributor to GDP. In service industry, human capital is the most important asset. HRP bears a disproportionate importance in this industry. Foundation of Personnel Functions : HRP provides for not only front line manpower but also caters for support staff requirement which are called Personnel Functions like recruitment, selection, personnel development, training and development etc. Large scale changes in frontline staff will have proportional changes in requirement of support staff as well which can be planned alongside.

HRP SYSTEM
HRP System as such includes following elements or sets for planning. Business Environment Overall Organization Objectives Forecasting Manpower Needs Assessing Manpower Supply Matching Manpower Demand-Supply factors Based on these elements we can draw HRP System Architecture as under. Business Environment

Organization Objectives & Goals Manpower Forecast Manpower Supply Assessment

Manpower Programming Manpower Implementation Control & Manpower Evaluation Surplus Manpower Shortage of Manpower

HRP PROCESS
Organizational Objectives & Policies: Organizational objectives and policies give a clue to future requirement of manpower. A company planning expansion would require more manpower in near future. Kind of people required would be dictated by technology being planned for expansion. HRP needs to align hiring of people with these elements. In addition, companys policies towards its manpower policies, like using internal resources for promotion or external resources or dependence on certain caste or region for some jobs have also to be catered for. Gujarati companies in diamond business hire only gujaraties. Similarly, certain Business Houses from Rajasthan prefer Rajasthanies. So, HRP process will be dictated by following organisational policies: 1. Internal Hiring or External Hiring? 2. Training & Development plans 3. Union Constraints 4. Job enrichment issues 5. Rightsizing organization 6. Automation needs 7. 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 long term corporate plans. Demand forecasting should be based on following factors. Internal Factors: Production levels New products and services Organizational structure Employee separation Budget constraints External Factors: Economic climate Laws and regulatory bodies Technology changes Social Factors Legal requirements with regards to reservations

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.

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 supervised Total Budget Managed Previous Management Duties Internal Supply Assessment: 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 Assessment: 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.

SUCCESSION PLANNING
Meaning of Succession Planning
Succession planning is the process or activities connected with the filling of key positions in the organization hierarchy as vacancies arise. Succession planning focuses on identification of future 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. Grooming a person to fill an important position may take years. Succession planning involves identification of key positions in the company and then scouting for people who can effectively fill those positions at short notice. Importance of Succession Planning 1. 2. 3. 4. 5. 6. Succession planning helps when there is a sudden need due to job hopping/death of serious injury to a key employee. There is little or no set back due to absence of key employee. Acts as a motivator for the individual employee who comes to know of the impending promotion in advance. 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 as a concept means a lifelong sequences of professional, educational and developmental experiences that an individual goes through in his working life. It is a sequence of positions occupied by a person during his life.

Career planning is the process of identifying an individuals strengths, weaknesses, aptitudes, inclinations, aspirations and attitudes and designing his job responsibilities to take maximum advantages of positive traits and minimising the effect negatives traits. After identifying the personality traits of the individual begins the process of identifying suitable job billets for him. It may also involve training at times to strengthen his weak areas. Career planning is a process of integrating the employees needs and aspirations with organizational requirements. A typical succession planning involves the following activities: 1. 2. 3. Analysis of the demand for managers and professionals by company level, function and skill. Audit of existing executives and projection of likely future supply from internal and external sources. Planning of individual career paths based on objective estimates of future needs and drawing on reliable performance appraisals and assessments of potential. Career counselling undertaken in the context of a realistic understanding of the future needs of the firm as well as those of the individual. Accelerated promotions with development targeted against the future needs of the business. Performance related training and development to prepare individuals for future roles as well as current responsibilities Planned strategic recruitment not only to fill short term needs but also to provide people for development to meet future needs The actual activities by which openings are filled

4. 5. 6. 7. 8.

JOB ANALYSIS
Definition 1 Job Analysis is a process of collecting and studying the information relating to operations and responsibilities of a specific job. The immediate products of this analysis are Job Description and Job Specifications. Definition 2 It is a basic technical procedure that is used to define duties and responsibilities and accountabilities of the job.

PURPOSE OF JOB ANALYSIS: Human Resource Planning (HRP) : staffing needs, type, quality and quantity. Job analysis helps in determining

Recruitment & Selection : Knowing the staffing needs is essential for Recruitment and Selection Right person for each job. Sourcing of recruits also becomes easy and cost effective Training & Development : Development programs. Job analysis is the key to determining Training and

Job Evaluation : Job evaluation means determination of relative worth of each job for the purpose of establishing wage and salary. This is possible with the help of job description and specifications; i.e. Job Analysis. Remuneration : jobs. Job analysis also helps in determining wage and salary for the

Performance Appraisal : Job analysis helps in fixing the bench marks of performance standards which in turn help in objective Performance appraisal, rewards, promotions, etc. 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.

JOB DESCRIPTION
Job Description implies objective listing of the job title, tasks, and responsibilities involved in a job. Job description is a word picture of the duties, responsibilities and organizational relationships that constitutes a given job or position. It defines work assignment and a scope of responsibility that are sufficiently different from those of the other jobs to warrant a specific title. Job description is a broad statement of purpose, scope, duties and responsibilities of a particular job.

Contents of Job Description

1. Job Identification 2. Job Summary 3. Job Duties and Responsibilities 4. Supervision specification 5. Machines, tools and materials 6. Work conditions 7. Work hazards 8. Definition of unusual terms

Format of Job Description

1. Job Title 2. Region/Location 3. Department 4. Reporting to (Operational and Managerial) 5. Objective 6. Principal duties and responsibilities

JOB SPECIFICATIONS
Job Specification involves listing of qualifications, skills and abilities required in an employee to meet the job description. These specifications are minimum required to do the job satisfactorily. In other words, it is a statement of minimum acceptable physical/psychological attributes and professional skills necessary to perform the job properly. Job specifications seek to indicate kind of persons who can be expected to meet the role requirements. Thus, it is basically concerned with matters of selection, screening and placement and is intended to serve as a guide in hiring.

Contents of Job Specifications

1. Physical Characteristics 2. Psychological characteristics 3. Personal characteristics 4. Educational Qualifications 5. Skill Set and Experience/Responsibilities 6. Demographic features Job specifications can be further divided into three broad categories 1. 2. 3. Essential Attributes Desirable Attributes Contra-Indicators Attributes which are likely to act as impediments to success of job

JOB EVALUATION
Job evaluation is the process of analyzing and assessing various jobs systematically to ascertain their relative worth in an organization. Job Evaluation involves determination of relative worth of each job for the purpose of establishing wage and salary differentials. Relative worth is determined mainly on the basis of Job Description and Job Specification only. Job Evaluation helps to determine wages and salary grades for all jobs. Employees need to be compensated depending on the grades of jobs they perform. Remuneration must be based on the relative worth of each job. Ignoring this basic principle results in inequitable compensation and attendant ill effects on employees morale. A perception of inequity is a sure way of de-motivating an employee. Jobs are evaluated on the basis of content and placed in order of importance. This establishes Job Hierarchies, which becomes the basis for satisfactory wage differentials among various jobs. Jobs are ranked (not jobholders)

PROCESS OF JOB EVALUATION:

1. Defining objectives of job evaluation (a) (b) (c) (d) (e) (f) Identify jobs to be evaluated (Benchmark jobs or all jobs) Who should evaluate job? What training do the evaluators need? How much time involved? What are the criteria for evaluation? Methods of evaluation to be used

2. Wage Survey 3. Employee Classification 4. Establishing wage and salary differentials.

METHODS OF JOB EVALUATION

1. Analytical Methods (a) Point Ranking Methods: Different factors are selected for different jobs with accompanying differences in degrees and points.

(b) Factor Comparison Method: The important factors are selected which can be assumed to be common to all jobs. Each of these factors are then ranked with other jobs. The worth of the job is then taken by adding together all the point values. 2. Non-Analytical Methods (a) Ranking Method: Jobs are ranked on the basis of their title or contents. Like Managers, Supervisors, Workers, Peon, etc. All managers whether from production, planning, sales, stores or Allied Services (House Keeping) Deptt are treated equal. Job is not broken down into factors etc. It is easier to implement but not always satisfactory for the employees. (b) Job Grading Method: It is based on the job as a whole and the differentiation is made on the basis of job classes and grades. Like in a hotel, Receptionists job may be graded higher than back office billing clerks job. Similarly, a production/sales manager billet may be graded higher than Allied Services Managers. In this method it is important to form a grade description to cover discernible differences in skills, importance to companys core operations, responsibilities and other characteristics.

PITFALLS OF JOB EVALUATION:

1. Sometimes encourages employees to manipulate for promotion/internal placement when there may be limited opportunities for enhancement as a result of downsizing. 2. It promotes internal focus (office politics) instead of customer orientation 3. Not suitable for forward looking organizations, which may have trimmed multiple job titles into two or three broad jobs.

JOB DESIGN
In the most simplified form - The process of breaking/organizing work into specific tasks in order to perform a specific job is called Job Design. Job Design is the logical Sequence to Job Analysis. Job design involves conscious efforts to organise tasks, duties and responsibilities into a unit of work to achieve certain objective.

Steps in Job Design

1. Specification of Individual Tasks 2. Specification of Methods for Tasks Performance 3. Combination of Tasks into Specific Jobs to be assigned to individuals

FACTORS AFFECTING JOB DESIGN

1. Organizational factors (a) Characteristics of Tasks (Planning, Execution and Controlling of Task) (b) Work Flow (Process Sequences) (c) Ergonomics (Time & Motion Study) (d) Work Practices (Set of ways of performing tasks) 2. Environmental Factors (a) Employee Abilities and Availability (b) Social and Cultural Expectations 3. Behavioural Elements (a) Feedback (b) Autonomy (c) Use of Abilities (d) Variety

TECHNIQUES OF JOB DESIGN

1. Work Simplification : Job is simplified or specialized. The job is broken down into small parts and each part is assigned to an individual. To be more specific, work simplification is breaking down the job to such small tasks that complexity is taken out of them. Like in a assembly line of car, one person only

tighten wheel nuts with a pneumatic tool which tighten the nuts. The complexity of ensuring that each nut is tightened to required degree has been transferred to machine and the worker only applies the tool to the right place. He does not even put the wheel in place. In such cases, work becomes repetitive in nature. Work simplification is used when jobs are not specialized. 2. Job Rotation : Same job, same people, same surrounding, days over days, months over months, leads to boredom and even fatigue. And it manifests in higher error rate, fall in productivity, absenteeism, job hopping, etc. Job rotation is answer to such problems. While broadly the job may remain same, minor variations between jobs are enough to rejuvenate the employee. It not only benefits the personnel but also the organisation in equal measure (a) Benefit to the Employee. It is a development tool since the employees get exposure to several jobs which develops their personality and employability. It improves their self-image and leads to personal growth. Such cross functional deployments often reveal hidden performance potentials/skills of many employees in the course of new job. (b) Benefits to the Company: Such cross functional knowledge of employees provides the company with a fall back option in case of absence of any employee. It also gives flexibility to the management to reorganise the functional setup just in case of need like demand pattern shift or change in business model or any other eventuality. Also, periodic job rotation is the best method to avoid compartmentalisation of departments. Movement of personnel between departments and first hand knowledge of limitations and problems faced by other departments reduces frictions and leads to better cooperation between them. Interpersonal bonds developed during in the course of such cross functional job rotation further smoothens the interaction between departments. On the negative side, training costs rise and it can also de-motivate intelligent and ambitious trainees who might take it as their undesirability in their own department unless it is well laid down policy of the company. 3. Job Enlargement : It means expanding the number of tasks, or duties assigned to a given job. Job enlargement is naturally opposite to work simplification. Adding more tasks or duties to a job does not necessarily mean that new skills and abilities are needed. There is only horizontal expansion. It is with same skills taking additional responsibilities like increasing the number of machines operators under a supervisor from 10 to 15. Job enlargement may involve breaking up of the existing work system and redesigning a new work system. For this employees also need to be trained to adjust to the new system. Job enlargement is said to contribute to employee motivation but the claim is not validated in practice. Job Enrichment : Job enrichment is to add a few more motivators to a job to make it more rewarding. A job is enriched when the nature of the job is exciting,

4.

challenging, rewarding and creative or gives the job holder more decisionmaking, planning and controlling powers. An enriched job will have more authority, responsibility, autonomy (vertical enrichment), more variety of tasks (horizontal enrichment) and more growth opportunities. The employee does more planning and controlling with less supervision but more self-evaluation. For example: transferring some of the supervisors tasks to the employee and making his job enriched. As per Hertzberg, who was the father of this term, an enriched job has eight characteristics: (a) Direct Feedback: Employee should be able to get immediate knowledge of the results they are achieving. (b) Client Relationship: An employee who serves a client or customer directly has an enriched job. The client can be outside or inside the firm. (c) New Learning: An enriched job allows its incumbent to feel that he is growing intellectually. (d) Scheduling Own Work: Freedom to schedule own work (autonomy) is job enrichment. (e) Unique Experience: A enriched job has some unique qualities or features. (f) Control over Resources: One approach to Job enrichment is for the each employee to have control over his or her resources and expenses. (g) Direct Communication Authority: An enriched job allows worker to communicate directly with people who use his or her output. (h) Personal Accountability: An enriched job holds the incumbent responsible for the results. He or she receives praise for good work and blame for poor work. Problems with Job Enrichment (a) Job enrichment is not a substitute for good governance. If other environmental factors in the business are not right, mere job enrichment will not mean much. (b) Job enrichment may have short term negative effects till the worker gets used to the new responsibility. (c) Job enrichment itself might not be a great motivator since it is job-intrinsic factor. As per the two-factor motivation theory, job enrichment is not enough. It should be preceded by hygienic factors etc. (d) Job enrichment assumes that workers want more responsibilities and those workers who are motivated by less responsibility, job enrichment surely de-motivates them (e) Workers participation may affect the enrichment process itself. (f) Change is difficult to implement and is always resisted as job enrichment brings in a changes the responsibility.

5.

Autonomous or Self-Directed Teams : Empowerment results in selfdirected work teams. A self-directed team is a group of employees responsible for a whole work segment. They work together, handle day-to-day problems, plan and control, and are highly effective team.

JOB SATISFACTION
Job satisfaction is self satisfaction derived by an employee in doing the job he has been entrusted to do. Job satisfaction is more a function of the various attitudes possessed by an employee towards his job, related factors and life in general than the job itself. The attitudes related to job may be wages, supervision, steadiness, working conditions, advancement opportunities, recognitions, fair evaluation of work, social relations on job, prompt settlement of grievances etc. A person with a kind heart will find high level of job satisfaction in working with some agency involved in charitable work though the salary might be relatively less. An over ambitious person will never find the job satisfaction. In short job satisfaction is a general attitude towards the job, which is the result of many specific attitudes in three areas namely, job factors, individual characteristics and group relationships outside the job.

COMPONENTS OF JOB SATISFACTION

Personal factors: Sex, Dependents, Age, Timings, Intelligence, Natural affinity towards the job, Education and Personality. Job Inherent Factors: Nature of work, Skills, Occupational status, Geography, etc. Management Controlled Factors: Security, Payment, Fringe benefits, Advancement opportunities and Working conditions, Co-workers, Responsibilities, Supervision

WORK SAMPLING
Definition: "A measurement technique for the quantitative analysis of an random/irregularly occurring activity."

MEANING OF WORK SAMPLING

Work sampling is based on the theory that the characteristics of a sufficiently large sample represent the actual characteristics of entire population. Work sampling operates by an observer taking a series of random observations on a particular "item" of interest (machine, operating room, dock, etc.) to observe its "state" (working, idle, sleeping, empty, etc.). When enough samples are taken, an analysis of the observations yields a statistically valid indication of the states for each thing analyzed. Assume, for example, that you wish to determine the proportion of time a factory operator is working or idle. Also assume that 200 random observations were made of the operator and during 24 of these he or she was observed to be idle. From the random samples of his state you conclude that the individual is working 176/200 = 88% of the time.

ADVANTAGES OF WORK SAMPLING

It is relatively easy, simple and inexpensive to use and extremely helpful in providing a deeper understanding of all types of operations. When properly used, it can help pinpoint those areas, which should be analyzed in further detail and can serve as a measure of the progress being made in improving operations.

QUESTIONS OF WORK SAMPLING STUDY

What is our equipment/asset utilization? When we are not adding value to the product, how are we spending our time? How are our inter-dependent systems performing? Where should we focus our continuous improvement activities?

DISTINCTION BETWEEN WORK SAMPLING AND "TIME STUDIES"

Before we set out to analyse the distinctions between work sampling and time studies, let us understand that the two are as different as chalk and cheese. The purpose of each is different and one can not be substituted by the other in most cases. While work sampling is a broad analysis of trend, time study is microanalysis of the job and procedure. Time study is conducted with a view to improve the process/method where as work sampling is done to improve quantitative utilisation of resources.

Work sampling is relatively cheaper because it uses random samples instead of continuous observations. Many operators or machines can be studied by a single observer Work sampling normally spans over several days or weeks, thus minimizing the effects of sudden variations on a particular day.

Work Sampling tends to minimize operator behaviour modification during observation (operator, deliberately or otherwise, under or over performing while under observation). Work Sampling, in general, does not require a trained time-study analyst to take the observations. Also, stopwatches or other timing devices are not required. Many studies make use of off-shift technicians or operators to take the observations.

WORK SAMPLING METHODOLOGY

An analyst RANDOMLY observes an activity (equipment, operating room, production line) and notes the particular states of the activity at each observation. The ratio of the number of observations of a given state of the activity to the total number of observations taken will approximate the percentage of time that the activity is in that given state. Randomness of observations is very critical for a work sampling study. The observations should vary over the time of the day, days of the week and if possible, months to get he correct trend.

RECRUITMENT
Definition: Recruitment is the process of finding and attracting capable applicants for a job to create a pool from which selection is to be made of the most suitable candidates. The Process begins when new recruits are sought and ends when their applications are submitted. Though theoretically recruitment process is said to end with the receipt of applications, in practice, the activity extends to the screening of applications so as to eliminate those who are not qualified for the job. The result is a pool of applicants from which selections for new employees are made.

PURPOSE AND IMPORTANCE

1. 2. 3. 4. 5. To broad base the applicant pool in order to get the right talent at the affordable cost. Increase the pool of job candidates at minimum cost Help increase success rate of selection process by reducing number of underqualified or over-qualified applications. Meet legal and social obligations Identify and prepare potential job applicants

FACTORS AFFECTING RECRUITMENT

External Factors: 1. 2. 3. 4. 5. Demand and Supply status of specific skills set. Unemployment Rate (Area-wise) Labour Market Conditions Political and Legal Environment (Reservations, Labour laws) Companys Image

Internal Factors: 1. 2. Recruitment Policy (Internal Hiring or External Hiring?) Human Resource Planning (Planning of resources required)

3. 4. 5.

Size of the Organization (Bigger the size lesser the recruitment problems) Cost Growth and Expansion Plans

RECRUITMENT PROCESS
1. Recruitment Strategy Development (a) (b) Trained or untrained (to be trained at companys expense) Internal or external sourcing Internal Recruitment (Source 1) (i) (ii) (iii) (iv) (v) Present employees Employee referrals Transfers & Promotions Former Employees Previous Applicants

External Recruitment (Source 2) (i) (ii) (iii) (iv) (v) (vi) (vii) (viii) (ix) (x) (c) (d) (e) (f) 2. Professionals or Trade Associations Advertisements Employment Exchanges Campus Recruitment Walk-ins Interviews Consultants Contractors Displaced Persons Radio & Television Acquisitions & Mergers

Competitors Technological tools to be used for advertising Where to look How to look

Recruitment Planning (a) Number of applicants sought (Based on past experience)

(b) 3.

Types of applicants to be called (Qualification, category, area, etc)

Searching (a) (b) Source activation Selling

4. 5.

Screening of Applications Evaluation and Cost Control (a) (b) (c) (d) (e) (f) (g) Salary Cost Management & Professional Time spent Advertisement Cost Producing Supporting literature Recruitment Overheads and Expenses Cost of Overtime and Outsourcing Consultants fees

EVALUATION OF RECRUITMENT PROCESS

1. 2. 3. 4. 5. 6. Return rate of each source of recruitment Selection rate from each source Retention and Performance of selected candidates Recruitment Cost Time lapsed data Image projection INTERNAL RECRUITMENT Advantages Disadvantages Less Costly 1. Old concept of doing things Candidates already oriented towards 2. It abets raiding organization 3. Candidates current work may be Organizations have better knowledge affected about internal candidates 4. Politics play greater roles Employee morale and motivation is 5. Morale problem for those not enhanced promoted.

1. 2. 3. 4.

EXTERNAL RECRUITMENT

SELECTION
MEANING OF SELECTION
Selection is the process of picking up individuals (out of the pool of job applicants) with requisite qualifications and competence to fill jobs in the organization. A formal definition of Selection is as under: Selection is the process of differentiating between applicants in order to identify and hire those with a greater likelihood of success in a job.

RECRUITMENT Vs SELECTION: DIFFERENCE

Recruitment Selection 1. Recruitment refers to the process of 1. Selection is concerned with picking up identifying and encouraging people the right candidates from a pool of with required qualifications to apply for applicants. job. 2. Selection on the other hand is negative 2. Recruitment is said to be positive in its in its application in as much as it seeks approach as it seeks to attract as many to eliminate as many unqualified candidates as possible. applicants as possible in order to identify the right candidates.

PROCESS / STEPS IN SELECTION

1. Preliminary Interview : This is a short interview. The purpose of preliminary interviews is to weed out the prima facie misfit applicants. It is also called courtesy interview and is a good public relations exercise. 2. Selection Tests : Jobseekers who pass the preliminary interviews are called for tests. There are various types of tests conducted depending upon nature of job and the company. These tests can be Aptitude Tests, Personality Tests and Ability Tests and are conducted to judge how well an individual can perform tasks related to the job. Besides this, there are some other tests also like Interest Tests (activity preferences), Graphology Test (Handwriting), Medical Tests, Psychometric Tests etc. 3. Employment Interview : The next step in selection is employment interview. Here, interview is a formal and in-depth conversation to assess applicants suitability. It is considered to be an excellent selection device. Interview type and

pattern can vary greatly. Interviews can be One-to-One, Panel Interview, or Sequential Interviews. Besides there can be Structured and Unstructured interviews, Behavioural Interviews, Stress Interviews. 4. Reference & Background Checks : Reference checks and background checks are conducted for provisionally identified candidates to verify the information provided by them. Reference checks can be through formal letters or telephonic. However, it is more of a formality and selections decisions are very seldom affected by it. 5. Selection Decision : After obtaining all the information, selection decision is made. The final decision has to be made out of applicants who have been identified as suitable. The views of line managers carry much weight at this stage because it is they who are eventually responsible for the performance of the new employee. Considering the job climate, often more than required number is selected to cater for any selected candidate withdrawing at the job offer stage. 6. Physical Examination : After the selection decision is made, the candidate is required to undergo a physical fitness test. A job offer is often contingent upon the candidate passing the physical examination. 7. Job Offer : The next step in selection process is job offer to those applicants who have successfully passed all tests. It is made by way of letter of appointment. 8. Contract of Employment : After the job offer is made and candidates accept the offer, certain documents are needed to be executed by the employer and the candidate. A formal contract of employment, containing written contractual terms of employment etc are signed by both sides.

GOOD SELECTION PRACTICE: ESSENTIALS

1. Detailed Job Descriptions and Job Specifications prepared in advance and endorsed by personnel and line management should be available with Selection Board. 2. Train the selectors to assess the right attributes in applicants. 3. Determine aids to be used for selection process. 4. Check competence of recruitment consultants before hiring their services. 5. Involve line managers at all stages 6. Attempt to validate the procedure regularly 7. Help the appointed candidate to succeed by training and management development

BARRIERS TO EFFECTIVE SELECTION

1. Perception : We all perceive the world differently. Our limited perceptual ability is obviously a stumbling block to the objective and rational assessment of people. 2. Fairness : Barriers of fairness includes discrimination against religion, region, caste, race or gender, etc. 3. Plethora of Human Traits : Success in any job is more a function of attitude than aptitude. The tests are validated over a period of time to differentiate between the employees who can perform well and those who will not. Yet, no test can claim 100% success in finding the right employee. 4. Pressure : Pressure brought on selectors by management, politicians, bureaucrats, relatives, friends and peers to select particular candidate are also barriers to effective selection. 5. Time and Cost : Often the time and funds available to undertake selection process are limited forcing the selectors to forego certain tests.

TRAINING & DEVELOPMENT

Training and development, though are spoken in the same breadth, are quite different. Training generally refers to teaching of new skill in professional field of the employee. Like an employee being taught to operate another machine, or to perform a new operation in the same machine. Development refers to enhancement of personal qualities of the employee which do not have a one to one relationship with his current job. It may be to help an employee to grow. Like stress management techniques, yoga lessons, meditation exercises, soft skills training, etc. While training is expected to reward the company immediately in terms of better productivity of employee, Development does not lead to any immediate and tangible benefits to the company. At the best, there might be some intangible benefits in the long run, like improved motivation, loyalty, improved intradepartmental relations, reduced absenteeism on medical ground, etc. Dividing line between training and development is expectation of immediate benefits. Thus, in case a program, generally qualifying as development program, is directly related to employees job skills, like Communication Skills course for telephone attendant or receptionist, will qualify as training and not as development. Same program for some one in back office would be termed as Development program. Education: It is a theoretical learning in classrooms. The purpose of education is to teach theoretical concepts and develop a sense of reasoning and judgment. Any training and development program must contain an element of education. Definition of Training & Development Training & Development is any attempt to improve current or future employee performance by improving his performance capabilities and potential through learning, usually by changing the employees attitude or increasing his or her skills and knowledge. The need for Training and Development is determined by the employees performance deficiency, computed as follows. Training & Development Need = Standard Performance Actual Performance

OBJECTIVES OF MANAGEMENT DEVELOPMENT PROGRAMS (MDP)

1. To make the managers Self-starters Committed

Motivated Result oriented Sensitive to environment Understand use of power

2. Creating self awareness 3. Develop inspiring leadership styles 4. Instil zest for excellence 5. Teach them about effective communication 6. To subordinate their functional loyalties to the interests of the organization

TRAINING AND DEVELOPMENT: DIFFERENCE

Training Training is skills focused Training is presumed to have a formal education Training needs depend upon lack or deficiency in skills Trainings are generally need based Training is a narrower concept focused on job related skills Training may not include development Development Development is creating learning abilities Development is not education dependent

Development depends on personal drive and ambition Development is voluntary Development is a broader concept focused on personality development Development includes training wherever necessary Training is aimed at improving job related Development aims at overall personal efficiency and performance effectiveness (including job efficiencies)

IMPORTANCE OF TRAINING & DEVELOPMENT

1. Helps remove performance deficiencies in employees 2. Greater stability, flexibility and capacity for growth in an organization 3. Accidents, scraps and damages to machinery can be avoided 4. Serves as effective source of recruitment 5. It is an investment in HR with a promise of better returns in future 6. Reduces dissatisfaction, absenteeism, complaints and turnover of employees

IDENTIFICATION OF TRAINING NEEDS

Individual Training Needs Identification 1. Performance Appraisals 2. Interviews 3. Questionnaires 4. Attitude Surveys 5. Training Progress Feedback 6. Work Sampling 7. Rating Scales Group Level Training Needs Identification 1. Organizational Goals and Objectives 2. Personnel / Skills Inventories 3. Organizational Climate Indices 4. Efficiency Indices 5. Exit Interviews 6. MBO / Work Planning Systems 7. Quality Circles 8. Customer Satisfaction Survey 9. Analysis of Current and Anticipated Changes Benefits of Training Needs Identification 1. Trainers can be informed about the broader needs in advance 2. Trainers Perception Gaps can be reduced between employees and their supervisors 3. Trainers can design course inputs closer to the specific needs of the participants 4. Diagnosis of causes of performance deficiencies can be done

METHODS OF TRAINING
On the Job Trainings (OJT): When an employee learns the job in actual working site in real life situation, and not simulated environment, it is called OJT. Employee learns while working. Take the instance of roadside mechanics. Small boys working there as helpers learn while helping the head mechanic. They do not learn the defect analysis and engine repairing skills in any classroom on engine models.

Advantages of On-the-Job Training: 1. 2. 3. 4. 5. 6. It is directly in the context of job It is often informal It is most effective because it is learning by experience It is least expensive Trainees are highly motivated It is free from artificial classroom situations

Disadvantages of On-the-Job Training: 1. Trainer may not be experienced enough to train or he may not be so inclined. 2. 3. It is not systematically organized Poorly conducted programs may create safety hazards

On the Job Training Methods 1. 2. 3. Job Rotation: Refer page 27.

Job Coaching: An experienced employee can give a verbal presentation to explain the nitty-grittys of the job. Job Instruction: It may consist of an instruction or directions to perform a particular task or a function. It may be in the form of orders or steps to perform a task. Apprenticeships: Generally fresh graduates are put under the experienced employee to learn the functions of job. Internships and Assistantships: Interns or assistants are recruited to perform specific time-bound jobs or projects during their education.

4. 5.

Off the Job Training: Trainings conducted in simulated environments, classrooms, seminars, etc are called Off the Job Training. Advantages of Off-the-Job Training 1. 2. 3. Trainers are usually experienced enough to train It is systematically organized Efficiently created programs may add lot of value

Disadvantages of Off-the-Job Training: 1. It is not directly in the context of job

2. 3. 4. 5. 6.

It is often formal It may not be based on experience. It is expensive. Trainees may not be much motivated It is artificial in nature

Off the Job Training Methods 1. Classroom Lectures: Advantage It can be used for large groups. Cost per trainee is low. Disadvantages Low interest of employees . It is not learning by practice. It is One-way communication. No authentic feedback mechanism. Likely to lead to boredom for employees. 2. Audio-Visual: It can be done using Films, Televisions, Video, and Presentations etc. Advantages Wide range of realistic examples, quality control possible. Disadvantages One-way communication, No feedback mechanism. No flexibility for different audience. 3. Simulation: Creating a real life situation for decision-making and understanding the actual job conditions give it. Ensures active participation of all trainees. Can be very effective but needs good conductors. 4. Case Studies: It is a written description of an actual situation in the past in same organisation or some where else and trainees are supposed to analyze and give their conclusions in writing. This is another excellent method to ensure full and whole hearted participation of employees and generates good interest among them. Case is later discussed by instructor with all the pros and cons of each option. It is an ideal method to promote decision-making abilities within the constraints of limited data. 5. Role Plays: Here trainees assume the part of the specific personalities in a case study and enact it in front of the audience. It is more emotional orientation and improves interpersonal relationships. Attitudinal change is another result. These are generally used in MDP. 6. Sensitivity Trainings: This is more from the point of view of behavioural assessment as to how an individual will conduct himself and behave towards others under different circumstances. There is no pre-planned agenda and it is instant. Advantages increased ability to empathize, listening skills, openness, tolerance, and conflict resolution skills. Disadvantage Participants may resort to their old habits after the training. 7. Programmed Instructions: Provided in the form of blocks either in book or a teaching machine using questions and feedbacks without the intervention of trainer. Advantages Self paced, trainees can progress at their own speed, strong motivation for repeat learning, material is

structured and self-contained. Disadvantages Scope for learning is less; cost of books, manuals or machinery is expensive. 8. Computer Aided Instructions: It is extension of PI method, by using computers. Advantages Provides accountabilities, modifiable to technological innovations, flexible to time. Disadvantages High cost. 9. Laboratory Training.

BARRIERS TO EFFECTIVE TRAINING

1. Lack of Management commitment 2. Inadequate Training budget 3. Large scale poaching of trained staff 4. Non-cooperation from workers 5. Unions influence

HOW TO MAKE TRAINING EFFECTIVE

1. Management Commitment 2. Integration of Training with Business Strategies 3. Comprehensive and Systematic Approach 4. Continuous and Ongoing approach 5. Promoting learning as fundamental value 6. Creations of effective training evaluation system

INDUCTION & ORIENATION

Induction and Orientation are the procedure that a new employee has to go through in the organisation. Every employee starting from the lower most, say, from peon to CEO, need orientation course when they join the organisation. A new employee carries with him a lot of apprehension about place, job, colleagues, organisational culture, and so on. On the day of reporting, he needs to know his office/work place, routine, amenities, functional and reporting channels, etc. Definition It is a Planned Introduction of employees to their jobs, their co-workers and the organization per se. Difference Between Induction and Orientation Induction refers to formal training programs that an employee has to complete before he is put on job. Like in Military, before a new recruit is sent to border, he is trained for a few months in Drill/Parade, physical fitness, weapon handling, etc. This is called Induction. Orientation is the information given to the new employees to make him aware of the comfort issues - where the facilities are, what time lunch is, who are the people he would be working with and so forth. Orientation conveys following information: 1. Organisations geography/layout 2. Organisational set up (Structure) 3. Daily Work Routine 4. Organization Profile, History, Objectives, Products and Services, etc 5. Introduction to colleagues/immediate superiors and subordinates. 6. Importance of Jobs to the organization 7. Detailed Orientation Presentation covering policies, work rules and employee benefits.

PURPOSE OF ORIENTATION
The idea of Orientation programme is to make the new employees feel at home in new environment. Any employee while joining a new organisation is anxious about the new

set-up, new colleagues, his own performance vis a vis other more experienced employees in the organisation, his work place, his exact responsibilities, etc. A structured information and introduction system will make his transitory period short and reduce his anxiety quickly. He will begin to perform to his potential quickly.

TYPES OF ORIENTATION PROGRAMS

1. Formal or Informal: In informal orientation, new employees are put on the jobs and they are expected to acclimatise themselves with the work and the organisation. In contrast, in formal orientation, an employee goes through a structured introduction programme. 2. Individual or Collective: Another choice is to be made whether new employees are to be inducted in group or individually. 3. Serial or Disjunctive: Orientation becomes serial when the person relinquishing the post hands over the position to the new incumbent. It becomes disjunctive when the new employee occupies a vacant position with no one to hand him over the position. He learns the prevalent practices and history slowly from his subordinates and superiors on gradual basis. 4. Investiture or Divestiture: This is the final strategic choice which relates to decision regarding allowing the new employees to affect the organisation with his identity/ideas/functional methods or asking him to modify his identity to merge with existing culture of the organisation. This is more applicable to high positions who may have been hired with a view to bring in their experiences and methods of management to the organisation. How long should the induction process take? It starts when the job ad is written, continues through the selection process and is not complete until the new team member is comfortable as a full contributor to the organization's goals. The first hour on day one is a critical component - signing on, issuing keys and passwords, explaining no go zones, emergency procedures, meeting the people that you will interact with all have to be done immediately. Until they are done the newcomer is on the payroll, but is not employed. After that it is a matter of just in time training - expanding the content as new duties are undertaken. We only employ new people one at a time - how can we induct them? There are some issues, which cannot wait - they vary according to your situation. Perhaps a buddy system on the job may be the best way to deal with such situations. (This is a

system being followed by many US universities receiving lot of foreign students. A local student is given a foreign student as buddy to help in all matters in the initial days.) Other subjects may be incorporated with refresher training for current staff, or handled as participant in an outside program. Perhaps some can wait until there are groups of people who have started in the last few months. This may take some creative thinking, but the answer is quite simple - until the new people are integrated, they are less useful. The mathematics of Induction and orientation is often amazingly simple - not investing time and money to train costs more than training would.

MULTI SKILLING
Definition Multi-Skilling- the ability of an employee to perform more than one function or the crosstraining of an employee in several disciplines or tasks. Multi-Skilling is training of an employee to be able to do more than one job with equal dexterity. Multi-Skilling is immensely beneficial to any organisation. Apart from flexibility to redeploy man power as per changing needs, it also keeps the labour costs low. Many complex jobs require different skills to accomplish though involvement of each skill may be for very short duration. Thus, in absence of multi-skilled workers, the team becomes very large and there is inadequate utilisation of team members. But, if the team members are multi-skilled, team size can be kept small and thus the labour cost in minimised. In addition, often job is accomplished much faster with better quality as no time is lost in explaining the job requirements by one team member to another with attendant risks of misunderstanding and rework. Bank tellers are examples of multi-skilling. Result is much faster service. Imagine the state of extension counters of banks at school or college premises which are operated by just one or two employees. Those one or two people perform all the functions which take up to 7 -8 people in bigger branches. Opening the bank, opening new account, attending queries, accepting deposits and dispensing cash, verification of signatures, maintaining account books and many other tasks are done by them. If such multi-skilling was not available with the banks, such branches would have become unviable. Even in the larger branches, Advantages of Multi-Skilling (Tangible Benefits) 1. Work force is more flexible. 2. Smaller team size for complex tasks requiring multiple skills. 3. Faster job 4. Labour cost economy 5. Employees can assume other tasks when there is absenteeism. 6. Employees can be moved into other positions in case of overload of any department.

Advantages of Multi-Skilling (Intangible Benefits) 1. Employees become more aware of the workflow. 2. Employees are better prepared to anticipate problems or requirements of other areas. 3. A new employee at a job may have new ideas to fine-tune that job. 4. Employees overcome feelings of having a dead-end job. 5. Jobs remain interesting and challenging. 6. Tedious tasks can be spread around, decreasing turnover. 7. Boredom in the workplace is reduced. 8. Cohesiveness is enhanced. Disadvantages of Multi-Skilling 1. Possible reduction in productivity during the training period/longer training period. 2. Increased supervisory time is required until the employee is up to speed. 3. Competence assessments may be more detailed than in traditional systems. 4. Chances of partial skilling in various jobs instead of fully skilled in any one.

CHANGE MANAGEMENT
Change Management is a Critical HR Professional Skill Definitions: 1. 2. The adoption of a new idea or behaviour by an organization. Alterations in People, Structure and Technology

Change has become inevitable due to: (a) (b) (c) (d) (e) Technology Competition Growing customer needs Environment Politics

HRs role in the change process is to help forecast future changes, develop systems and policies for managing human capital before, during & after the change. Change can be classified as follows: Structural Changes Authority Coordination Centralization Technological Changes Processes Methods Equipments People Changes Attitudes Expectations Behaviours

EXTERNAL FORCES OF CHANGE

1. 2. 3. 4. 5. Marketplace Labour markets Economic Changes Technology Laws and Regulations

INTERNAL FORCES OF CHANGE

1. 2. 3. 4. Corporate Strategies Workplace Technology and Equipments Employee Attitudes

C H A N G E A G E N T S ( WHO CAN BRING ABOUT CHANGE?)

1. 2. 3. Managers External Consultants Staff Specialists

PROCESS OF CHANGE
Lewins Three-Step Procedure of Change 1. 2. 3. Unfreeze present level of behaviour Movement from present to new Refreezing process

Kotters Change Management Model 1. 2. 3. 4. 5. Unfreeze Establish Sense of Urgency Form Powerful Guiding Coalition Create the Vision Communicate the Vision

RESISTANCE/BARRIERS TO CHANGE
1. 2. 3. 4. Fear of uncertainty or unknown Fear of economic loss Social pressures/peer pressure Perceived inconveniences

5. 6. 7. 8. 9. 10.

Fear of loss of power Need for new styles/skills/knowledge Resistance from groups Organisational culture Feeling of insecurity Lack of incentives

MANAGING CHANGE
It involves: 1. 2. 3. 4. 5. 6. 7. Strategic planning and alignment Minimising resistance Maximising acceptance External environment assessment Change of Organisational structure and culture Developing work climate to enhance teamwork, trust and co-operation Whole hearted implementation

TECHNIQUES OF REDUCING RESISTANCE

1. 2. 3. 4. 5. 6. Education through communication Participation of affected people from beginning rather than at the end. Making the potential hardliners a member of the committee designing the change. Facilitation through support to people to overcome the blues of change Negotiation Give and take attitude Manipulation co-option Explicit or implicit coercion

Mixed strategies are used to overcome change

FOUR PHASES OF TRANSITION- OLD TO NEW

1. Denial Diagnosis: Common to observe withdrawal; focusing on the past; increased activity with reduced productivity.

Management: Confront with information; reinforce reality of change; explain what they can do; give them time. 2. Resistance Diagnosis: Anger, blame, depression, resentment, continued lack of productivity.

Management: Listen, acknowledge feelings, be empathetic; help people to say good by to the old; sometimes ritual is important. Offer rewards for change, be optimistic. 3. Exploration Diagnosis: Confusion, chaos; energy; new ideas; lack of focus.

Management: Facilitate brainstorming, planning, help people to see opportunity, create focus through short term wins. 4. Commitment Diagnosis: Enthusiasm & cooperation; people organization; look for new challenges. identify with

Management: Set long term goals; reward those who have changed.

ORGANIZATIONAL DEVELOPMENT TECHNIQUES

Survey Feedback Sensitivity Training Process Consultation Team Building Inter-group Development Conditions Facilitating Change Dramatic Crisis Leadership Change Weak Culture Young and Small Organization (ageing) The Road to Change in Culture Analyze the culture Need for change New leadership Reorganize Restructure New stories and rituals Change the job systems

TQM V/S. REENGINEERING

TQM (Total Quality Management) Continuous Change Fixing and Improving Mostly focused on As-Is Systems indispensable Bottom to Top Managing Downsized Workforce Open and honest communication Assistance to them Help for survivors of the downsized Stress in Workplace Opportunities stress Demands stress Constraints stress Re engineering Radical and One time Change Redesigning Mostly focused on what can be? Top to Bottom

HOW TO REDUCE WORKPLACE STRESS

Biggest source of stress is Uncertainty. Quite often worst of the result is less painful than the anxiety waiting for it. If you can reduce uncertainty, stress will automatically reduce. However, reducing uncertainty is not always possible. Some of these methods can be employed to reduce work place stress: 1. 2. Organizational communication: Clear and prompt communication of policies and decisions can help in keeping the stress within manageable limits. Performance Assessment is another source of anxiety. Clear predefined performance parameters will take the uncertainty out of assessment and also anxiety. Job Redesign, especially when processes change, jobs merging, and relocation happens Employee Counselling Time management programs for employees: In the busy life of today, time management is another source of stress for a lot of employees. Time management programs will allow them to fill in more events into their daily life and reduce stress.

3. 4. 5.

WHY CHANGE MANAGEMENT?

Change is the only constant in todays world. And the rate of change is faster than ever. You can not escape change. The choice is - You can bring the change yourself at your pace, place and time, or Allow it to overcome you at its own choosing of time, place and pace. Fighting against change can slow it down or divert it temporarily, but it won't stop. If you wish to succeed in this rapidly changing new world "you must learn to look at change as a friend - one who presents you with an opportunity for growth and improvement." Earlier you change, higher the benefits. Those who recognise the changing trends and change simultaneously are successful. Those who anticipate/foresee the impending change and prepare according are the ones who are hugely successful. But those who lead the change are the ones who make the fortune. The rate of change in today's world is constantly increasing. Rate of obsolescence and therefore replacement is increasing. New, better, safer and cheaper products are entering the market at constantly decreasing interval. Changes in technology is leading to changes in business models and customer behaviour. True success and long-term prosperity in the new world depends on your ability to adapt to different and constantly changing conditions. But despite all this, basic human nature, that resists change, is still intact. Any attempt to bring change is fiercely resisted. And if the resistance is not well managed, it can be catastrophic for the organisation. Therefore, change management assumes criticality.

EVOLUTIONARY (PLANNED) CHANGE VERSUS REVOLUTIONARY (FORCED) CHANGES

How you change a business unit to adapt to shifting economy and markets is a matter of management style. Evolutionary change, that involves setting direction, allocating responsibilities, and establishing reasonable timelines for achieving objectives, is relatively painless. However, it is rarely fast enough or comprehensive enough to move ahead of the curve in an evolving world where stakes are high, and the response time is short. When faced with market-driven urgency, abrupt and sometimes disruptive change, such as dramatic downsizing or reengineering, may be required to keep the company competitive. In situations when timing is critical to success, and companies must get more efficient and productive rapidly, revolutionary change is demanded. When choosing between evolutionary change and revolutionary action, a leader must pursue a balanced and pragmatic approach. Swinging too far to revolutionary extreme may create "an organizational culture that is so impatient, and so focused on change, that it fails to give new initiatives and new personnel time to take root, stabilize, and grow. What's more, it creates a high-tension environment that intimidates rather than nurtures people, leaving them with little or no emotional investment in the company."

CREATING CHANGE FOR IMPROVEMENT AND COMPETITIVE ADVANTAGE

Change creates opportunities, but only for those who recognize and seize it. "Seeing is the first step, seizing the second, and continuously innovating is the third." Innovation redefines growth opportunities. As current products are becoming obsolete faster than ever, in order to survive and prosper, organizations continually need to improve, innovate and modify their products and services. The Silicon Valley slogan "Eat lunch and you are lunch" is more than a reflection of increasingly intense work ethic. Riding the wave of change is becoming the most important part of the business. While the economy is shifting and innovation is rampant, "doing it the same way" is a recipe for corporate extinction.1 Successful change efforts are those where the choices both are internally consistent and fit key external and situational variables. "You have to find subtle ways to introduce change, new concepts, and give feedback to people so that they can accept and grow with it."

PERFORMANCE APPRAISALS
WHAT IS PERFORMANCE APPRAISAL?
Performance Appraisals is the assessment of individuals performance in a systematic way. It is a developmental tool used for all round development of the employee and the organization. The performance is measured against a number of factors. These factors can be divided into two groups. (a) (b) General personality such as initiative, leadership qualities, dependability, team spirit, etc. Professional qualities like job knowledge, quality and quantity of output, versatility and so on.

Factors vary from organization to organization and job to job. For a soldier, courage and endurance are more important factors. But for the Army General, his tactical abilities are more important. On the other side, a foreman in a factory would never be assessed for his courage. Assessment is often not confined to past performance but checks for potential performance also. The second definition brings in focus behaviour because behaviour affects not only employees performance but even his peers and subordinates. Definition 1: It is a systematic evaluation of an individual with respect to present performance on the job and his potential. Definition 2: It is formal, structured system of measuring/evaluating job related behaviours and outcomes to discover how an employee has performed on the job and how he can perform more effectively in future so that employee, organization and society, all benefits.

PERFORMANCE APPRAISALS AND JOB ANALYSIS RELATIONSHIP

Job Analysis Describes the work and personnel requirement of a particular job Performance Standard Translate job requirements into levels of acceptable or unacceptable performance Performance Appraisal Describe the individuals past performance, suitability and potential.

Objectives: Performance appraisals are used as a basis for following activities: 1. 2. Promotions Confirmations

3. 4. 5. 6. 7.

Training and Development program planning Compensation reviews Competency building Evaluation of HR Programs Feedback & Grievances

PERFORMANCE APPRAISAL PROCESS

1. Setting Objectives and Standards of performance 2. Design an appropriate appraisal program Appraisal program for different levels of employees would be different. 3. Performance Interviews 4. Appraise and record the performance 5. Use and store data for appropriate purposes 6. Identify opportunities variables

TECHNIQUES / METHODS OF PERFORMANCE APPRAISALS

Numerous methods have been devised to measure the quantity and quality of performance appraisals. Each of the methods is effective for a particular class of employees in certain types of organization only. Broadly all methods of appraisals can be divided into two different categories. Past Oriented Methods Future Oriented Methods

PAST ORIENTED METHODS

1. Rating Scales: This is simplest and most popular method. Rating scales consist of grading an employees past performance on a scale of say 1 -10. Each of the selected performance attribute is numerically marked and then totalled to arrive at the final figure. Advantages Adaptability, easy to use, low cost, every type of job can be evaluated, large number of employees covered, no formal training required. Disadvantages Raters biases.

2. Checklist: Under this method, checklist of Statements of Traits of employee in the form of Yes or No based questions is prepared. Here, the rater only does the reporting or checking and HR department does the actual evaluation. Advantages economy, ease of administration, limited training required, standardization. Disadvantages Raters biases, use of improper weights by HR Deptt, does not allow rater to give relative ratings. 3. Forced Choice Method: A series of statements arranged in the blocks of two or more are given and the rater indicates which statement is true or false. The rater is forced to make a choice. HR department does actual assessment. Advantages Absence of personal biases because of forced choice. Disadvantages Statements may not be correctly framed. 4. Forced Distribution Method: One of the problems faced in large organizations is relative assessment tendencies of raters. Some are too lenient and others too severe. This method overcomes that problem. It forces every one to do a comparative rating of all the employees on a predetermined distribution pattern of good to bad. Say 10% employees in Excellent Grade, 20% in Good Grade, 40% in Average Grade, 20% in Below Average Grade and 10% in Unsat grade. The real problem of this method occurs in organizations where there is a tendency to pack certain key departments with all good employees and some other departments with discards and laggards. Relatively good employees of key departments get poor rating and relatively poor employees of laggards departments get good rating.

10% 20% Unsat Below Avg Excellent

40% Average

20% Good

10%

5. Critical Incidents Method: It takes cognisance of abnormal incidences only, good or bad. Supervisors record such incidents as and when they occur. Advantages Evaluations are based on actual job behaviours. Ratings are supported by descriptions, thus favouritism is beaten. Feedback is easy and reduces recency biases. Disadvantages Negative incidents may get priority or incidences could be forgotten. 6. Field Review Method: This method is useful only for senior positions in a large organisation spread over cities and countries. Appraisal is done by someone outside employees own department usually from corporate or HR department. Advantages

Useful for managerial level promotions, when comparable information is needed, on employees working at distant locations in different set of conditions. Disadvantages Outsider is generally not familiar with employees work environment, Observation of actual behaviours not possible. 7. Performance Tests & Observations: This is based on the test of knowledge or skills. The tests may be written or an actual presentation of skills. Tests must be reliable and validated to be useful. Advantage Tests only measure potential and not attitude. Actual performance is more a function of attitude of person than potential. Disadvantages Some times costs of test development or administration are high. 8. Confidential Reports: Though popular with government departments, its application in industry is not ruled out. Here the report is given in the form of Annual Confidentiality Report (ACR). The system is highly secretive and confidential. Feedback to the assessee is given only in case of an adverse entry. Disadvantage is that it is highly prone to biases and recency effect and ratings can be manipulated because the evaluations are linked to future rewards like promotions, good postings, etc. 9. Essay Method: In this method the rater writes down the employee description in the form of an essay. Advantage It is extremely useful in filing information gaps about the employees that often occur in a better-structured checklist. Disadvantages It its highly dependent upon the writing skills of rater and most of them are not good writers. Moreover, it is also time consuming and therefore affects full assessment. Also, comparative or relative performance among employees is not clearly demarcated. 10. Cost Accounting Method: Here performance is evaluated from the monetary returns yield to his or her organization. Cost to keep employee, and benefit the organization derives is ascertained. Hence, it is more dependent upon cost and benefit analysis. 11. Comparative Evaluation Method (Ranking & Paired Comparisons) : These are collection of different methods that compare performance with that of other co-workers. The usual techniques used may be ranking methods and paired comparison method. Ranking Method: Superior ranks his worker based on merit, from best to worst. However how best and why best are not elaborated in this method. It is easy to administer. Paired Comparison Method: In this method each employee is paired with every other employee in the same cadre and then comparative rating done in pairs so formed. The number of comparisons may be calculated with the help of a formula N x (N-1) / 2. The method is too tedious for large departments and often such exact details are not available with rater.

FUTURE ORIENTED METHODS

12. Management By Objectives (MBO): Performance is rated against the achievement of objectives mutually agreed by the employee and the management. Advantage It is direct and accurate and transparent. Disadvantages Applicable only to quantifiable jobs. Short-term goals given preference at the cost of long-term goals etc. 13. Psychological Appraisals: These appraisals are more directed to assess employees potential for future performance rather than the past one. It is done in the form of indepth interviews, psychological tests, and discussion with supervisors and review of other evaluations. It is more focused on employees emotional, intellectual, and motivational and other personal characteristics affecting his performance. This approach is slow and costly and may be useful for bright young members who may have considerable potential. However quality of these appraisals largely depends upon the skills of psychologists who perform the evaluation. 14. Assessment Centres: This technique was first developed in USA and UK in 1943. An assessment centre is a central location where managers may come together to have their participation in job related exercises evaluated by trained observers. It is more focused on observation of behaviours across a series of select exercises or work samples. Assessees are requested to participate in in-basket exercises, work groups, computer simulations, role playing and other similar activities which require same attributes for successful performance in actual job. Disadvantages Concentrates on future performance potential. No assessment of past performance. Costs of employees travelling and lodging, psychologists. Ratings strongly influenced by assessees inter-personal skills. Solid performers may feel suffocated in simulated situations. Advantages Well-conducted assessment centre can achieve better forecasts of future performance and progress than other methods of appraisals. Also reliability, content validity and predictive ability are said to be high in Assessment Centres. The tests also make sure that the wrong people are not hired or promoted. Finally, it clearly defines the criteria for selection and promotion. 15. 360-Degree Feedback: It is a technique in which performance data/feedback/rating is collected from all sections of people employee interacts in the course of his job like immediate supervisors, team members, customers, peers, subordinates and self with different weightage to each group of raters. This technique has been found to be extremely useful and effective. It is especially useful to measure inter-personal skills, customer satisfaction and team building skills. One of the biggest advantage of this system is that assesssees can not afford to neglect any constituency and has to show allround performance. However, on the negative side, receiving feedback from multiple sources can be intimidating, threatening, expensive and time consuming. Purpose of performance evaluation is to make sure that employees goals, employees behaviour and feedback about performance are all linked to the corporate strategy.

ESSENTIALS OF A GOOD PERFORMANCE APPRAISAL SYSTEM:

1. Standardized Performance Appraisal System 2. Defined performance standards Bench Marks 3. Uniformity of appraisals 4. Trained Raters 5. Use of relevant rating tools or methods 6. Should be based on job analysis 7. Use of objectively verifiable data 8. Avoid rating problems like halo effect, central tendency, leniency, severity etc. 9. Consistent Documentations maintained 10. No room for discrimination based on cast, creed, race, religion, region etc.

Problems of Rating:
1. Leniency & Severity Either too lenient or too severe. All good or all bad. 2. Central Tendency Majority is crowded around average. 3. Halo/Gholem Effect Entire assessment is affected by one or few aspects. 4. Rater Effect Favouritism, stereotyping, hostility, etc, kind of biases. 5. Primacy & Recency Effect Early period or near end period behaviour effects. 6. Perceptual Sets Effects of old beliefs about groups, regions, groups, etc 7. Spill-over Effects Effects of previous appraisal affecting recent appraisal 8. Status Effect High esteemed or low esteemed job bearing on the appraisal.

HUMAN RESOURCE AUDIT

NATURE OF HR AUDIT
HR Audit is a tool for evaluating the personnel activities of an organization. The audit may include one division or entire company. It gives feedback about HR functions to operating managers and HR specialists. It also shows how well managers are meeting HR duties. In short HR audit is an overall control check on HR activities in a division or a company and evaluation of how these activities support organizations strategy.

B A S I S O F H R A U D I T (PERSONNEL RESEARCH)
1. Wage Surveys 2. Recruitment Sources effectiveness 3. Training efforts effectiveness 4. Supervisors effectiveness 5. Industrial dispute settlements 6. Job Analysis 7. Job Satisfaction Survey 8. Employee needs survey 9. Attitude Surveys 10. Accident frequency surveys

BENEFITS OF HR AUDIT
1. Assessment of contributions of HR department 2. Improvement of professional image of HR department 3. Encouragement of greater responsibility and professionalism among HR members 4. Clarification of HR duties and responsibilities 5. Stimulation of uniformity of HR policies and practices 6. Finding critical personnel problems

7. Ensuring timely compliance with legal requirements 8. Reduction of HR costs through more effective personnel procedures 9. Creation of increased acceptance of changes in HR department 10. A thorough review of HR information systems

SCOPE AND TYPES OF HR AUDIT

HR Audit must cover the activities of the department and even extend beyond because the people problems are not confined to HR department alone. Based on this, HR audit can be spread across following four different categories. 1. 2. 3. Human Resource Function Audit Managerial Compliance Audit Human Resource Climate Audit (a) (b) (c) (d) 4. Employee Turnover Absenteeism Accidents Attitude Surveys

HR - Corporate Strategy Audit

APPROACHES TO HR AUDIT
1. 2. 3. 4. 5. Comparative Approach (Benchmarking with another company) External Authority Approach (Outside consultants standards) Statistical Approach (Statistical measures and tools) Compliance Approach (Legal and company policies) Management By Objectives Approach (Goals & Objectives based)

MOTIVATION THEORIES
Performance is a function of ability and motivation. P = f (A x M) Definition: Motivation is a set of forces that cause internal desire in people to behave in certain ways.

MOTIVATION PROCESS (6 STEPS)

1. 2. 3. 4. 5. 6. Identify Individuals Needs Search for ways to satisfy needs Goal & Objectives directed Increased performance Receiving rewards or punishment Reassessment of needs

CRITICALITY OF MOTIVATION TO MANAGERS

Manager is responsible for improving the productivity of his subordinates and ensuring that his they contribute towards the objective and mission of the organisation. It is only possible when employees perform at their maximum efficiency level. Motivation is a tool to achieve high level of performance from employees. Depending upon the direction, motivation can achieve one or more of the objectives below: 1. 2. 3. 4. 5. 6. Motivation improves productivity. Motivation stimulates both participation and production at work Motivation helps employees find new ways of doing a job Motivation makes employees quality conscious Motivation improves job related behaviour. Motivation increases attention towards human resources along with physical resources

CHALLENGES OF MOTIVATION
1. Diverse and changing workforce

2. 3. 4.

Rightsizing, Downsizing, Hire-n-Fire, Pay-for-Performance strategies Motives can only be inferred, not seen Dynamic nature of human needs

THEORIES OF MOTIVATION EARLY THEORIES

Scientific Management (F.W. Taylor): Motivation by scientific management is associated with F.W. Taylors techniques of scientific management. Taylor said that people are primarily motivated by economic rewards and will take direction if offered an opportunity to improve their economic positions. Based on this Taylor described following arguments Physical work could be scientifically studied to determine optimal method of doing of a job. Workers can be made more efficient by telling them how they were to do a job. Workers would accept the above prescription if paid on differentiated piecework basis. Disadvantages Dehumanized workers, treated them as mere factors of production, only stressed on monetary needs, ignored human needs.

Human Relations Model (Elton Mayo): Elton Mayos human relations model, developed through Hawthorne Studies, stressed on social contacts as motivational factor. Greater importance was given to informal groups. However, too much reliance on social contacts to improve productivity was a major drawback.

CONTEMPORARY THEORIES
Content Theories (Maslows Need Hierarchy, Hertzbergs 2-factors, Alderfers ERG, Achievement Motivation Theory) Process Theories (Vrooms expectancy, Adams Equity, Porters Performance and Satisfaction Model) Reinforcement Categories (ERG Theory (Alderfer) Existence - Relatedness Growth) ERG theory emphasizes more on three broad needs that is Existence, Relatedness and Growth. Its hypothesis is that there may be more than one need operating at the same

time. ERG theory further states that when a higher level need is frustrating, the individuals desire to increase lower level needs takes place. Thus, ERG theory contains frustration-regression dimension. Frustration at higher level need may lead to regression at lower level need. Advantages More consistent with our knowledge of differences among people, it is less restrictive and limiting, it is a valid version of need hierarchy. Disadvantages No clear-cut guideline of individual behaviour patterns, too early to pass a judgment on the overall validity of the theory. Two-Factor Theory (Hertzberg) Fredrick Hertzberg states that the motivation concept is generally driven by two factors of motivators of job satisfactions and hygiene factors about job dissatisfaction. Motivators are generally achievement, recognition, the work itself, responsibility, advancement and growth, which are related to job satisfaction. Hygiene factors deal with external factors like company policy, supervision, administration and working conditions, salary, status, security and interpersonal relations. These factors are known as hygiene factors or job dissatisfiers, job context factors. Advantages Tremendous impact on stimulating thought on motivation at work, increased understanding of role of motivation, specific attention to improve motivational levels, job design technique of job enrichment is contribution of Hertzberg, double dimensions of two factors are easy to interpret and understand. Disadvantages Limited by its methodology, reliability questioned, it focuses more on job satisfaction not on motivation, no overall measure of satisfaction utilized, inconsistent with previous research, productivity factor ignored.

MORALE
Definition 1: Morale is a mental condition or attitude of individual and groups, which determines their willingness to co-operate. Definition 2: Morale is attitudes of individuals and groups towards their work environment and towards voluntary cooperation to the full extent of their ability in the best possible interest of the organization. Morale can be said to be a combination of satisfaction, happiness and enthusiasm. Distinction between Morale and Motivation: Morale 1. Composite of feelings, attitudes and sentiments that contribute towards general satisfaction at workplace. 2. A Function of freedom or restraint towards some goal. 3. It mobilizes sentiments. 4. Morale reflects Motivation. Motivation 1. Motivation moves person to action. 2. A Process of stimulating individuals into action to accomplish desired goals. 3. A Function of drives and needs. 4. It mobilizes energy. 5. Motivation is a potential to develop morale.

PERSONNEL POLICIES
MEANING OF PERSONNEL POLICY
A Policy is a Plan of Action. It is a statement of intentions committing the management to a general course of action. A Policy may contain philosophy and principles as well. However a policy statement is more specific and commits the management to a definite course of action. Hence Personnel policy is the companys plan of action towards treatment of its employees in matters of pay, benefits, welfare, work, etc. A personnel policy spells out basic needs of the employees. Through personnel policy the personnel department ensure a fair and consistent treatment to all personnel by minimizing favouritism and discrimination. Personnel policy serves as a standard of treatment to all employees. Sound personnel policies help build employee motivation and loyalty. And this happens when personnel policies reflect fair play and justice and help people grow within the organization. Personnel policies are also plans of action to resolve intra-personal, interpersonal and inter-group conflicts.

IMPORTANCE OF PERSONNEL POLICY

Personnel policy is very important for an organization since it gives several benefits for managing the human resources effectively. Listed below are some of the benefits: 1. 2. 3. 4. 5. 6. 7. Consistent Treatment: Personnel policies ensure consistent treatment of all personnel throughout the organization. Fair Play & Justice: play and justice. Minimize Favouritism: discrimination Personnel policies reflect established principles of fair Personnel policies help minimize favouritism and

Promote Stability: Personnel policies ensure continuity of action plan even if top management is changed. These policies promote stability. Motivation & Loyalty: motivation and loyalty. Sound Personnel policies help build employee

Basic Needs: Personnel policy helps the management to think deeply about basic needs of organization and the employees. Standard of Performance: Personnel policies serve as a standard of performance.

8.

Growth: Personnel policies help people grow within the organization.

WORKERS PARTICIPATION IN MANAGEMENT

Broadly, workers participation in management means associating representatives of workers at every stage of decision-making. Participative management is considered as a process by which the workers share in decision-making extends beyond the decisions that are implicit in the specific content of the jobs they do. This amounts to the workers having a share in final managerial decisions in an enterprise.

SCOPE OF WORKERS PARTICIPATION

Scope of workers participation ranges over three managerial decision-making stages. 1. 2. 3. Social Decisions: Hours of work, welfare measures, work rules, safety, health, sanitation and noise control. Personnel Decisions: Recruitment and selection, promotions and transfers, grievance settlements, work distribution Economic Decisions: Methods of manufacturing, automation, lay offs, shutdowns, mergers and acquisitions and other financial aspects.

METHODS OF WORKERS PARTICIPATION IN MANAGEMENT

1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. Board Level Ownership (share allocation) Complete Control Staff Councils Joint Councils Collective Bargaining Job Enlargement and Enrichment Suggestion Schemes Quality Circles Empowered Teams Total Quality Management Financial Participation

BENEFITS OF PARTICIPATION
1. Gives identity to an employee 2. Motivates employee 3. Self-esteem, job satisfaction and cooperation improves 4. Reduced conflicts and stress between Management and workers 5. More commitment to goals 6. Less resistance to change 7. Less labour problems 8. Better quality suggestions expected

UNIONS
Employee associations are popularly known as unions. Although they have become synonymous with strikes and unreasonable demands, their role is much wider than this. Unions make their presence felt in recruitment and selection, promotions, training, termination or lay off. Many programs, which contribute to the Quality of Work Life (QWL) and productivity, are undertaken by management in consultation with and with the cooperation of the unions. Unions also participate in deciding wage and salary structure and negotiate revisions once in 3 or 5 years. Trade unions are voluntary organizations of workers or employers formed to promote their interests through collective action. Trade unions Act 1926 defines a trade union as a combination, whether temporary or permanent formed primarily for the purpose of regulating the relation between 1. 2. 3. Workmen and Employers Workmen and Workmen Employers and Employers

For imposing restrictive conditions on the conduct of any trade or business and includes any federation of two or more trade unions

WHY DO EMPLOYEES JOIN TRADE UNIONS?

1. 2. 3. 4. 5. To protect themselves against exploitation by management By force Dissatisfaction Lack of Power Union Instrumentality

ROLE OF CONSTRUCTIVE AND POSITIVE UNION

Unions have a crucial role to play in Industrial Relations. Unions have following broad role or objectives as mentioned below. 1. 2. To redress the genuine grievances of individual worker vis--vis the individual employer, by substituting joint or collective action for individual action. To secure improved terms and conditions of employment for its members and the maximum degree of security to enjoy these terms and conditions.

3. 4.

To obtain improved status for the worker in his work or her work To increase the extent to which unions can exercise democratic control over decisions, which affect their interests by power sharing at the national, corporate and plant levels.

The union power is exerted primarily at two levels. Industry level to establish joint regulation on basic wages and hours with an employers association. Plant level, where the shop stewards organizations exercise joint control over some aspects of the organization of work and localized terms and conditions of employment. Unions are party to national, local and plant level agreements, which govern their actions to a greater or lesser extent, depending on their power and on local circumstances.

UNFAIR LABOR PRACTICES

Industrial Disputes Act, 1947, specifies the following as unfair labour practices: 1. 2. 3. 4. 5. 6. 7. 8. To interfere, restrain, coerce workmen in the exercise of their right to organize, form, join or assist a trade union. Threatening workmen with discharge or dismissal Threatening of lockout or closure Granting wage increases to undermine trade union efforts To dominate, interfere with or support financially or socially by taking active interest in forming own trade union, and Showing partiality or granting favours to one of several trade unions To establish employer sponsored trade unions To encourage or discourage memberships in any trade union by discriminating workman by punishing or discharging, changing seniority ratings, refusing promotions, giving unmerited promotions, discharging union office bearers To discharge or dismiss workmen by victimizing, not in good faith, implicating in criminal case for patently false reasons. To abolish work of a regular nature To transfer workmen To show favouritism or partiality To replace workers To recruit workmen during legal strikes To indulge in acts of violence or force To refuse collective bargaining Proposing and continuing lockouts

9. 10. 11. 12. 13. 14. 15. 16. 17.

ORGANIZATIONAL DOWNSIZING
Downsizing necessarily means reducing work force to an optimal level depending upon the business conditions and organizational needs. It is said that an organization should be rightly staffed ie. It should not be overstaffed and or understaffed. There are broadly following method used to downsize the workforce as mentioned below.

RETRENCHMENT
It means termination of service. It is a termination for reasons other than disciplinary actions, retirement or superannuating, expiry and termination of contract or prolonged illness. Retrenchment compensation and notice for retrenchment are only pre-conditions for retrenchment. If notice and compensation are not given, the worker will not be called as retrenched. Compensation is payable for 15 days wages for every completed year of service besides one months notice or pay in lieu of notice. But employee should have completed at least one year of complete service in order to receive compensation.

LAY OFFS
Lay off is inability of the employer to provide employment to workers due to circumstances beyond his control such as shortage of power, coal, breakdown of machinery, natural calamity etc. It is not a termination of service. Lay off compensation can be claimed as a statutory right by the worker if he has completed one year of continuous service or has worked for 240 days on the surface or 190 days underground in 12 calendar months. Compensation payable is half of the wages.

VOLUNTARY RETIREMENT SCHEMES

VRS are announced when there is a huge pool of old aged manpower occupying senior positions amounting to surplus. Many organizations are providing liberal incentives to leave before age of superannuation. VRS in other words is a retirement before the age of retirement.