Human Resource Management sem - II Unit-1

SVCE M.jyothi Asst Prof & K. Muni Bhaskar Asst. Prof Page 1

HUMAN RESOURCE MANAGEMENT

Concept: It is the process of acquiring, developing, employing, appraising,
remuneration and retaining people, so that right type of people available at right
position and at right time in the organization.

Definition: The personnel function and maintenance of the personnel of an
organization for the purpose of contributing towards the accomplishment of that
organizations major goals and objectives. Edwin B.Flippo

OR

Edwin Flippo defies HRM as planning, organizing, directing, controlling of
procurement, development, compensation, integration , maintenance and separation
of human resources to the end that individual, organizational and social objectives are
achieved".

Staffing is the function by which managers build an organization through the
recruitment, selection and development of individuals as capable employees.

Features:
1. It is specialized branch of general management and therefore act the principals
of general management apply to this branch of management also.
2. It defines the relationship between employer and employee and employee and
employee.
3. It considers the development if people at work, as an individual and as a
member of the group.
4. It is goal oriented as its object is to contribute the organizational goals.
5. It is not something to be used sparingly. Every manager as required to perform
the personnel function on a continuous on the work.
General Objectives:
The statement of general objectives express the basic philosophy of top management
towards the labor force engaged on the work.

1. Maximum individual development.
2. Describe working relationship between employer and employees.
3. Effective moldings of human resources as contracted with physical resources.
Specific Objectives:


Human Resource Management sem - II Unit-1

SVCE M.jyothi Asst Prof & K. Muni Bhaskar Asst. Prof Page 2

It refers to the various activities of the personnel department
1. Selection of right type and right number of persons..
2. Proper orientation and introduction of new employees.
3. Organization of suitable training programs for better performance.
4. Provision of sound, fair and effective wages and salary administration.
5. Provision for better working conditions and other facilities.
6. Exit interviews
7. Good relations with trade unions
8. Management if grievances.

Evolution of HRM

The evolution of HRM can be traced back to Kautilya Artha Shastra where he
recommends that government must take active interest in public and private
enterprise. He says that government must provide a proper procedure for regulating
employee and employee relation.

The international institute of personnel management and national institute of labor
management were set up to look into problems faced by workers to provide solutions
to them. The Second World War created awareness regarding workers rights and
1940s to 1960s saw the introduction of new technology to help workers.

The 1960s extended the scope of human resource beyond welfare. Now it was a
combination of welfare, industrial relation, administration together it was called
personnel management.

With the second 5 year plan, heavy industries started and professional management
became important. In the 70s the focus was on efficiency of labor wile in the 80s
the focus was on new technology, making it necessary for new rules and regulations.
In the 90s the emphasis was on human values and development of people and with
liberalization and changing type of working people became more and more important
there by leading to HRM which is an advancement of personnel management.








Human Resource Management sem - II Unit-1

SVCE M.jyothi Asst Prof & K. Muni Bhaskar Asst. Prof Page 3


Changing nature of human resource management Functions

____________________________________________
| |
managerial function operative function
| |
planning employment
| |
organising human resource department

directing human relation
| |
controlling industrial relation
|
recent trends in hrm

Managerial Function:-

a. Planning:- it involves planning of hr requirements, recruitment, selection, etc. it
also involves forecasting of personal needs, changing values attitudes and behavior of
employees and their impact on the org.

b. Organizing:- it is the process of organizing people and other resources to work
together to accomplish a goal. it is essential shows relationships among the
employees so that they can collectively contribute the attainment of company goals.

c. Directing:- it next logical function after completing planning and organizing is the
execution of the plan. the basic function of personnel mgt at any level is motivating,
commanding, leading, and activating people. thus direction is an important
managerial function in building sound industrial and human relations besides
securing employee contributions

d. Coordinating:- it implies checking verifying is relating to ensure that every thing
occurs in conformily with the plans ado minimize the gap between desired results
and the actual performance. controlling the management of hr involves auditing
training program, analyzing labor turnover records, directing moral surveys,
conducting separation interviews and such other means.

Human Resource Management sem - II Unit-1

SVCE M.jyothi Asst Prof & K. Muni Bhaskar Asst. Prof Page 4

Operative functions:- it is also known as service function they are related to
specific activities of personnel mgt employment, development, compensation and
relation, all these functions are interacted with managerial functions.

a. Employment:- it is operative function of human resource management
employment is concerned with securing and employing the people processing the
required kind and level of hr necessary to achieve the organizational objectives.

b. Human Resource Development:- it is the process of improving, moulding and
changing the skills, knowledge, creative ability, aptitude, attitude, values,
commitment etc based on present and future job and organizational. requirement.

c. Compensation:- it is the process of providing of adequate, equitable and pair
remuneration to the employees. It includes job evaluations, wage and salary,
administration, incentives, bonus, fringe benefits, social security measurement.
d. Human Relation:- practicing various hr policies and programmes like
employment, development and compensation and interaction between the individual
worker and mgt among workers and trade unions and mgt.
-motivating the employees
-boosting employee morale
-understanding & applying the models of perception, learning
-developing the leadership skills.

e. Industrial Relations:- it refers to study of relation among employees, employer,
government and trade unions.
- India labor market
-Trade unionism
-Collective bargaining
-Industrial conflicts
-Quality circles.

f. Recent trends in human resource management:- human resource management
has been advancing at a past rate. the recent trends in human resource management
include.
-Quality of work life
-Total quality in human resources
-Human resource accounting, audit and research
-Recent techniques of human resource management.


Human Resource Management sem - II Unit-1

SVCE M.jyothi Asst Prof & K. Muni Bhaskar Asst. Prof Page 5

Effective HR department contributes to overall company success:

Human Resources Management or Personnel Management is defined as Planning,
Organizing, Directing and Controlling of the procurement, development
compensation, integration, maintenance and separation of human resources to the end
that individual, organizational and societal objectives are accomplished.

Planning: Effective Managers need to spend more time on Planning. Planning for
Human Resource Manager means determination in advance of a personnel program
that will contribute to goals established for the enterprise and for that purpose
involvement/participation of Human Resources Manager is must.

Organizing:is process of designing the structure of relationships among jobs,
personnel and physical factors.

Directing: is also known as motivation, actuation or command is linked to
getting people to go to work willingly and effectively

Controlling:concerns with regulating activities in accordance with the personnel
plan, which in turn was formulated on the basis of analysis of fundamental
organization goals.

Procurement: is concerned with the obtaining of the proper kind and number of
personnel necessary to accomplish the organizational goals. It deals with
determination of human resource requirement and their recruitment selection and
placement. The hiring process includes: applications screening, tests, checking
references and conducting interviews.

Development: deals with increase of skills through training that is necessary for
proper job performance. This activity of development is important because of change
in technology, re-alignment of jobs and increasing complexity of managerial task.

Compensation: is defined as the adequate and equitable remuneration of personnel
for their contributions to organizational objectives. It covers job evaluation wage
policies, wage systems and extra compensation plans.

Integration: it is concerned with an attempt to effect a reasonable reconciliation of
individual, societal and organizational interests. It covers grievances, disciplinary
action and labor unions.

Human Resource Management sem - II Unit-1

SVCE M.jyothi Asst Prof & K. Muni Bhaskar Asst. Prof Page 6

Maintenance: is concerned with physical condition of the employee to be
maintained including health and safety.
Separation: The first function of Human Resources Manager is hire/secure
employee; the last should be separation and return of that person to the society in
good shape. The separation covers: retirement, layoff, discharge etc.

CHALLENGES OF A MODERN HURMAN RESOURCES MANAGER
1. changing Mix of workforce
a. Increased No: of minority members entering occupations with greater
skills
b. increasing levels of formal education for entire workforce
c. more female employees (flexible working hours + sharing of jobs by 2-3
or more people)
d. more married female employees
e. more working mothers
f. increasing majority of white-collar employees in place of blue-collar
2. changing personal values of the workforce
a. Work ethics: has spiritual meaning in America which includes
punctuality, honesty, diligence fringe benefits linked with skills required
for the job.
b. Flexi time: allows flexibility of working hours. Flexi time was 1
st

started in Germany and then by other countries.
c. Redesigning of job.
d. Benefits to the Employer: due to Flexi time:
i. Enhanced productivity
ii. Reduced absenteeism
iii. Improved morale and reduced turn-over.
3. changing expectations of citizen-employees
a. improved quality of working life
b. right of speech
c. right of privacy
4. changing level of productivity
Problems of declining productivity in America:
various federal regulations adding to cost without enhancing productivity (e.g.,
environment health and safety)
such laws led to increase in female employees
American Managers have short term profit orientation and postponing research
and development
Increase in the services sector than manufacturing sector.
Human Resource Management sem - II Unit-1

SVCE M.jyothi Asst Prof & K. Muni Bhaskar Asst. Prof Page 7

Adversial relationship with labor unions reduced cooperation and decrease in
productivity
Employees alienation decrease productivity. This attitude is because of high
job insecurity, narrow and meaning less job, autocratic managers who deny
employee participation in decisions regarding quality of work
No discrimination against workers aged 40 to 70 years.
Maintenance: Occupational Safety and Health Act 1970 (enforces standards
through inspection and fines)
Separation:
a. Social Security Act, 1935 (retirement benefits and
unemployment compensation to those laid off by firms.
b. Employee retirement Income Security Act, 1974 (pensions +
ownership of shares)
5. changing demands of government
a. National Legislation P/M is more legalized society:
b. Federal Law relating to:
c. Procurement:
i. Civil Rights Acts 1964 (no discrimination on basis of race, color,
religion, nationality & sex)
ii. Equal opportunity Act, 1972 (direct court action)
iii. Rehabilitation Act, 1973 (to hire handicapped people)
d. Development
i. National Apprenticeship Program Act, 1937
ii. Manpower Development & Training Act, 1962
iii. Civil Rights Act, (1964) relates to training program.
e. Compensation
i. Davis Bacon Act, 1931 (minimum wages for govt.
construction work)
ii. Fair labor standards Act, 1938 (sets minimum wages + overtime
hours in commerce
iii. Equal Pay Act, 1963 (Equal pay for men and women for same
job)
iv. Civil Rights Act, 1964 (applies to pay)
f. Integration
i. National Labor Relation Act (Wagner) 1935 (gives right to form
unions on employer)
ii. Labor Management Relations Act 1947 (obligation for proper
bargaining on Unions)
iii. Civil Rights Act, 1964 (applies to discipline Age Discrimination
Act, 1967.
Human Resource Management sem - II Unit-1

SVCE M.jyothi Asst Prof & K. Muni Bhaskar Asst. Prof Page 8


6. changing new technology (NT)

7. changing size of organization

Roles and responsibilities of human resource management

A.OPERATIVE FUNCTIONS OF HRM: The operative functions of personnel
management are related to specific activities of personnel management viz.,
employment, development, compensation and relations. All these functions are
interacted by managerial functions. Further these functions are to be performed in
conjunction with management functions.

Employment: It is the first operative function of HRM. Employment is concerned
with securing and employing the people possessing required kind and level of human
resources necessary to achieve the organizational objectives. It covers the functions
such as job analysis, human resources planning, recruitment, selection, placement,
induction and internal mobility.

Job Analysis: It is the process of study and collection of information relating to the
operations and responsibilities of a specific job. It includes:
1. Collection of data, information, facts and ideas relating to various aspects of jobs
including men, machines and materials.
2. Preparation of job description, job specification, job requirements and employee
specification which help in identifying the nature, levels and quantum of human
resources.
3. Providing the guides, plans and basis for job design and for all operative functions
of HRM.

B. Administration Role of HRM:
The administrative roles of human resource management include policy formulation
and implementation, housekeeping, records maintenance, welfare administration,
legal compliance etc.
i. Policy maker: The human resource manger helps management in the formation of
policies governing talent acquisition and retention, wage and salary administration,
welfare activities, personnel records, working conditions etc. He also helps in
interpreting personnel policies in an appropriate manner.
Human Resource Management sem - II Unit-1

SVCE M.jyothi Asst Prof & K. Muni Bhaskar Asst. Prof Page 9

ii. Administrative expert: The administrative role of an HR manager is heavily
oriented to processing and record keeping. Maintaining employee files, and HR
related databases, processing employee benefit claims, answering queries regarding
leave, transport and medical facilities, submitting required reports to regulatory
agencies are examples of the administrative nature of HR management. These
activities must be performed efficiently and effectively to meet changing
requirements of employees, customers and the government.
iii. Advisor: It is said that personnel management is not a line responsibility but a
staff function. The personnel manager performs his functions by advising,
suggesting, counseling and helping the line managers in discharging their
responsibilities relating to grievance redressal, conflict resolution, employee selection
and training. Personnel advice includes preparation of reports, communication of
guidelines for the interpretation and implementation of policies, providing
information regarding labor laws etc.
iv. Housekeeper: The administrative roles of a personnel manager in managing the
show include recruiting, pre-employment testing, reference checking, employee
surveys, time keeping, wage and salary administration, benefits and pension
administration, wellness programmes, maintenance of records etc.
v. Counselor: The personnel manager discusses various problems of the employees
relating to work, career, their supervisors, colleagues, health, family, financial, social,
etc. and advises them on minimizing and overcoming problems, if any.
vi. Welfare officer: Personnel manager is expected to be the Welfare Officer of the
company. As a Welfare officer he provides and maintains (on behalf of the company)
canteens, hospitals, creches, educational institutes, clubs, libraries, conveyance
facilities, co-operative credit societies and consumer stores. Under the Factories Act,
Welfare officers are expected to take care of safety, health and welfare of employees.
The HR managers are often asked to oversee if everything is in line with the
company legislation and stipulation.
vii. Legal consultant: Personnel manager plays a role of grievance handling, settling
of disputes, handling disciplinary cases, doing collective bargaining, enabling the
process of joint consultation, interpretation and implementation of various labour
laws, contacting lawyers regarding court cases, filing suits in labour courts, industrial
tribunals, civil courts and the like.
In some organisations, the above administrative functions are being
outsourced to external providers in recent times, with a view to increasing efficiency
Human Resource Management sem - II Unit-1

SVCE M.jyothi Asst Prof & K. Muni Bhaskar Asst. Prof Page 10

as also cutting operational costs. Technology, is being put to good use to automate
many of the administrative tasks.
C.Stratgic role of HRM:
strengthening the employer-employee relationship is the strategic role of a human
resources manager. However, there's more than meets the eye to doing this. Human
resources managers formulate workforce strategy and determine the functional
processes necessary to meet organizational goals. Their job requires expertise as an
HR generalist, which means they must be familiar with every human resources
discipline.

Overview

During the 1980s, personnel departments were responsible for handing out
applications, providing employees with insurance enrollment forms and processing
payroll. The role of the personnel department was mainly administrative. Over the
next two decades, the role of personnel administration became more involved with
overall business goals. Companies began to recruit human resources leaders who
were capable of managing the department from a more strategic position. Personnel
administration, therefore, evolved into a business now referred to as human resources
management. Human resources managers are responsible for developing strategic
solutions to employment-related matters that affect the organization's ability to meet
its productivity and performance goals.

Responsibilities of a Human Resource Management:

1. Workplace Safety: Creating a work environment free from unnecessary hazards is
a strategic role of every human resources manager. Strategic development for
workplace safety entails risk management and mitigating potential losses from on-
the-job injuries and fatalities. Workers' compensation insurance is an area in which a
strategic plan helps lower company expense for insurance coverage. Reducing
accidents through training employees on the proper use of complex machinery and
equipment is one of the functional tasks associated with creating a safe work
environment.

2. Compensation and Benefits: An employer's compensation and benefits structure
partly determines the company's business reputation and image. In addition, the
decisions that human resources managers make regarding pay scales and employee
benefits can impact employee satisfaction, as well as the organization's ability to
recruit talented workers. Job evaluation, labor market conditions, workforce
shortages and budget constraints are factors that HR managers consider in a strategic
Human Resource Management sem - II Unit-1

SVCE M.jyothi Asst Prof & K. Muni Bhaskar Asst. Prof Page 11

plan for pay and benefits. In addition, a strategy includes weighing an employer's
choices between satisfying its workforce and pleasing the company's stakeholders.
Pursuant to the health care reform law passed in 2010, human resources managers for
companies with more than 50 employees must decide between offering group health
coverage and paying fines, beginning in 2014.

3. Employee Training: Human resources managers' strategic role with respect to
employee training and development prepares the workforce for future positions
within the company. Succession planning, promotion-from-within policies and
performance evaluation factor into the human resources manager's role. Training and
development motivate employees, and in some cases, improve employee retention.

4. Recruitment and Selection: Employee recruitment and selection :is as much a
part of employee relations as it is a separate discipline unto itself. Therefore, a human
resources manager's strategic role is to combine elements of employee relations into
the employer's recruitment and selection strategy. Integrating employee recognition
programs into promotion-from-within policies is an effective form of employee
motivation that combines the employee relations and recruitment and selection areas
of human resources.

5. Employee Relations: Some human resources managers believe that strengthening
the employer-employee relationship rests solely in the employee relations areas of the
HR department. This isn't true. Nevertheless, employee relations is such a large part
of every discipline -- including salaries, benefits, safety, training and employee
development -- that sustaining an employee relations program is an important
element of human resources strategy. Implementing a workplace investigation
process and enforcing fair employment practices are two components of an employee
relations program. The strategic role of a human resources manager is to determine
how to identify and resolve workplace issues, as well as how best to attract a diverse
pool of applicants through effective recruitment and selection processes.

6. Strategic Planning: International human resources, forecasting, planning, mergers
and acquisitions.

7. Personal Records: Information system records.


Human Resource Management sem - II Unit-1

SVCE M.jyothi Asst Prof & K. Muni Bhaskar Asst. Prof Page 12





Competitive Challenges Influencing HRM: Three competitive challenges that companies
now face will increase the importance of HRM practices

A. The Challenge of Sustainability
1.Stakeholders refers to shareholders, the community, customers, and all other parties
that have an interest in seeing that the company succeeds Sustainability refers to the
ability of a company to survive and succeed in a dynamic competitive environment.
Sustainability includes the ability to:
deal with economic and social changes,
engage in responsible and ethical business practices,
provide high quality products and services, and
put in place methods to determine if the company is meeting stakeholders needs
2.The changing structure of the economy
Impact of September 11, 2001
The competition for labor
1. Skill demands for jobs are changing
2. Knowledge is becoming more valuable
o Intellectual capital refers to the creativity, productivity, and service
provided by employees
Human Resource Management sem - II Unit-1

SVCE M.jyothi Asst Prof & K. Muni Bhaskar Asst. Prof Page 13

o Knowledge workers are employees who contribute to the company not
through manual labor but through a specialized body of knowledge
o Empowerment means giving employees responsibility and authority to
make decisions regarding all aspects of product development or
customer service
A learning organization embraces a culture of lifelong learning, enabling all
employees to continually acquire and share knowledge
5. The psychological contract describes what an employee expects to contribute and what the
company will provide to the employee for these contributions
6.Alternative work arrangements include independent contractors, on-call workers,
temporary workers, and contract company workers

B. The Global Challenge:
Companies are finding that to survive they must compete in international
markets as well as fend off foreign corporations attempts to gain ground in the
U.S.
Every business must be prepared to deal with the global economy. This is
made easier by technology.
Offshoring refers to the exporting of jobs from developed countries to less
developed countries.
Many companies are entering international markets by exporting their products
overseas, building manufacturing facilities in other countries, entering into
alliances with foreign companies, and engaging in e-commerce
C. The Technology Challenge:
Technology has reshaped the way we play, plan our lives, and where we work
The overall impact of the Internet
The Internet has created a new business model e-commerce in which
business transactions and relationships can be conducted electronically

Meeting Competitive Challenges Through HRM Practices:

1.HRM practices that help companies deal with the four competitive challenges can be
grouped into four dimensions
The human resource environment
Acquiring and preparing human resources
Assessment and development of human resources
Compensating human resources

2.Managing internal and external environmental factors allows employees to make the
greatest possible contribution to company productivity and competitiveness
Human Resource Management sem - II Unit-1

SVCE M.jyothi Asst Prof & K. Muni Bhaskar Asst. Prof Page 14

Customer needs for new products or services influence the number and type of
employees businesses need to be successful
Besides interesting work, pay and benefits are the most important incentives that
companies can offer employees in exchange for contributing to productivity,
quality, and customer service
Human resource management practices of both managers and the human resource
function must be aligned and contribute to the companys strategic goals

HR Management Activities