Unit-1 Introduction to Human Resource Management

Program

: MBA

Semester

: 1st Semester

Subject Code

: MB0043

Subject Name

: Human Resource Management

Unit number

:1

Unit Title

: Introduction to Human Resource

Management Policies

Lecture Number

:1

Lecture Title

: Introduction to Human Resource

Management Policies

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Unit-1 Introduction to Human Resource Management

Stabilisation Policies

Objectives
The objectives of this lecture are to:

describe the concept of HRM

define the scope of HRM
describe the history of HRM
explain the functions of human resource
recognise the role of HR executives

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Unit-1 Introduction to Human Resource Management

Lecture Outline

Introduction to Human Resource Management

Concept of Human Resource Management

Scope of Human Resource Management

History of Human Resource Management

Function of Human Resource Management

Role of HR Executives

Summary

Check Your Learning

Activity

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Unit-1 Introduction to Human Resource Management

Introduction

Every organisation is essentially a blend of material and Human Resource

(HR).

Human Resource refers to the knowledge, education, skills, training and

ability of the members of the organisation. Human resources are the

most valuable and unique assets of an organisation.

Even though specific human resource functions/activities are the

responsibility of the human resource department, the actual management

of human resources is the responsibility of all the managers in an

organisation.

The scarcity of talented resources and the growing expectations of the

modern day worker have further increased the complexity of the human

resource function.

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Unit-1 Introduction to Human Resource Management

Concept of Human Resource Management

Todays organisations constantly mould itself to meet the business

challenges despite economic, political and social patterns in which it
exists.

The efforts made by organisations to sustain business metrics like

revenue, profits and growth, market share is possible only through the
people in the organisation who work towards making this happen within
the enterprise.

According to Fisher, Schoendfelt and Shaw in their book Human

Resources Management, HRM involves all management decisions and
practices that directly affect or influence the people or Human
resources who work for the organisation.

(Contd)
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Unit-1 Introduction to Human Resource Management

Concept of Human Resource Management

Total
knowledge
Belief of the
individuals
involved

Attitudes

Skills

Human
Resources

Values

Creative
abilities

Talents
Aptitudes of an
organisations
workforce

(Contd)
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Unit-1 Introduction to Human Resource Management

Concept of Human Resource Management

A human resource manager has to build an effective workforce, handle

the expectations of the employees and ensure that they perform at
their best.

Some of the Objectives of HRM

The objectives of HRM can be classified into the following:

To act as a link between the top management and the employees.

To arrange and maintain adequate manpower inventory, which in turn,

ensures the smooth working of the organisation.

To help keep up ethical values and behaviour amongst employees both

within and outside the organisation.

(Contd)
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Unit-1 Introduction to Human Resource Management

Scope of Human Resource Management

The scope of HRM is wide and far-reaching.

An understanding of HRM is important to anyone who is employed in an

organisation.

HR issues become important wherever there is a group of workers.

Staffing is performed by all the managers as a managerial function,
either directly or indirectly through HR department.

All managers are, in this way, HR managers, since they get involved in
HR activities such as selecting, training, inducting, compensating and
motivating the employees along with industrial relations activities.

Scope of HRM under the following heads:

o

HRM in personnel management

HRM in employee welfare

HRM in industrial relations

(Contd)
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Unit-1 Introduction to Human Resource Management

Scope of Human Resource Management

HRM in
Personnel
Management

This is typically direct manpower management that involves

manpower planning, hiring (recruitment and selection), training
and development, induction and orientation, transfer, promotion,
compensation, layoff and retrenchment and employee productivity.

HRM in
Employee
Welfare

This particular aspect of HRM deals with working conditions and

amenities at the workplace.
This includes a wide array of responsibilities and services such as
safety services, health services, welfare funds, social security and
medical services.
It is about determining employees real needs and fulfilling them
with active participation of both the management and the
employees.

HRM in
Industrial
Relations

Industrial relations is the art and science of understanding the

employment (union-management) relations, joint consultations,
disciplinary procedures, solving problems with mutual efforts,
understanding human behaviour and maintaining work relations,
collective bargaining and settlement of disputes.
The main aim is to safeguard the interest of employees by securing
the highest level of understanding to the extent that does not leave
a negative impact on the organisation.

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Unit-1 Introduction to Human Resource Management

History of Human Resource Management

There is a vast difference between modern HRM and the personnel

management that was prevalent decades ago.

By the end of the twentieth century, the managerial philosophy that

had defined the personnel function had undergone radical changes.

There are various approaches:

o

Scientific management approach: Fredrick Taylor, who is widely

considered to be the father of scientific management, focused on
motions that were required for each job, the tools used and the
time needed to accomplish each task.

Human relations approach: The Hawthorne studies conducted

during the 1930 and 1940s, forced organisations to shift their
attention from scientific management approach to human relations
approach.
(Contd)
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Unit-1 Introduction to Human Resource Management

History of Human Resource Management

It was recognised that treating employees with respect would improve

employee satisfaction and help in achieving higher productivity.

Human resources approach: Human resources treat people as

resources, rather than factors of production, or as human beings who act
on the basis of emotions alone.

Some of the principles of human resource approach are:

Employees are assets to an organisation.

Policies, programmes and practices must cater to the needs of

employees and should help them in their work and in their personal
development.

Employee rewards may be monetary such as hike in salary or increments

or it may be non-monetary such as change in designation, status, fringe
benefits, etc.
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Unit-1 Introduction to Human Resource Management

Function of Human Resource Management

Human resource management involves blending the traditional

administrative functions along with the changing concepts of employee
welfare in the organisation.

The retention of employees is dependent on how they are perceived and

treated in the organisation based on their performance, abilities and
skills.

The extent of activities carried out by the HR is dependent on the size

and scope of the organisation, the nature of operations and the attitude
of management towards the employees.

HRM functions can be broadly classified into the following two categories:
o

Managerial functions

Operative functions
(Contd)
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Function of Human Resource Management

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Unit-1 Introduction to Human Resource Management

Function of Human Resource Management

Managerial functions of HR department

Planning Future course of action; it also includes identifying human

resource requirements and forecasting personnel needs.

Organising Division of labour; assignment of responsibility is part of

the organisations functions.

Staffing It is the process of obtaining and maintaining capable and

competent personnel in various positions at all levels, i.e., manpower
planning, recruitment, selection, placement and induction.

Directing It is the process of directing all the available resources

towards the common organisational goals.

Controlling It is the measurement and rectification of activities to

ensure that the events conform to plans.
(Contd)
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Unit-1 Introduction to Human Resource Management

Function of Human Resource Management

Operative functions of HR department: Operative functions of HR
department are those core functions that only the HR department is
assigned to perform. There functions include:

Employment Employment is the first operative function of HRM. This

involves procuring and employing individuals with suitable knowledge,
skills, experience and aptitude necessary to perform various jobs.

Functions of employment includes:

(Contd)
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Unit-1 Introduction to Human Resource Management

Function of Human Resource Management

The various functions of employment are:

Job analysis

HR planning

Recruitment

Selection

Placement

Induction

HR development

HR development concentrates on developing the workforce so that both

the employees and the organisation in turn can achieve their goals.

This includes functions starting with evaluating the performance of the

employees, providing necessary training and development programmes
to fill the gaps between current performances to the optimum
performance of employees.

(Contd)
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Unit-1 Introduction to Human Resource Management

Function of Human Resource Management

HR development involves functions such as:

Performance appraisal This is the process of evaluating the

performance of an employee on the job and developing a plan for the
employees improvement.

Training Training is the systematic development of knowledge, skills

and attitudes required to perform a given task or job successfully, in an
individual.

Management development It is the concept of developing the

employees of an organisation to meet future changes and challenges.

Career planning and development Career planning and

development refers to identifying ones career goals and formulating
plans for achieving them through various means such as education and
work experience.
(Contd)
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Unit-1 Introduction to Human Resource Management

Function of Human Resource Management

Compensation:

It includes all the rewards that an employee receives during the course
of his or her jobfor his or her contributions to the organisation. It
includes:

Job evaluation It is a systematic determination of the value of each

job in relation to other jobs in the organisation, in the industry and in the
market.

Wage and salary administration It is the process of formulating

and operating a suitable wage and salary programme.

Incentives These are the rewards that an employee earns in addition

to regular wages or salary based on the performance of the individual,
the team or the organisation.
(Contd)
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Function of Human Resource Management

Fringe benefits These are monetary and non-monetary benefits given

to employees during their employment and sometimes, also in the postemployment period.

Employee relations

It deals with the employees, in the organisational context, as a social

group that contributes to the organisation. It includes:
o

Increasing employee productivity.

Keeping the employees satisfied and motivated.

Developing team building, team management, leadership skills in

employees.

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Unit-1 Introduction to Human Resource Management

Role of HR Executives

Managing people is one of the biggest challenges for a manager. Few of

the reasons are:
o

Individuals differ from each other in terms of their values, attitudes,

beliefs and culture. This leads to a very complex situation.

The stimulating and motivational factors might not be the same for
all employees.

It is important to understand the individual needs of the employees and

cater to those needs.

This involves taking up different roles by the HR. The specialist role of HR
manager includes:
o

Service provider Management needs to gather information such

as market statistics, pay rates and labour laws and legislations from
the market as well as from their competitors before making
(Contd)
decisions on various employee related issues.
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Unit-1 Introduction to Human Resource Management

Role of HR Executives

Managing Administrative expert The administrative role involves

record keeping and legal compliance.

Facilitator They act as a facilitator when training and development

actions are planned and conducted and when performance appraisals are
done.

Consultant While supervising the employees, managers face many

problems.

Auditor HR specialists are responsible for ensuring that all members

of the management perform their respective roles efficiently and also
ensures that there is effective use of the human resources of the
organisation.

(Contd)
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Unit-1 Introduction to Human Resource Management

Role of HR Executives

Change agent It is the HR that helps organisations to implement

changes and help employees adapt to changes.

Employee advocate HR employees are the link between the top

management and the employees. The concerns of the employees are
first reported to the HR personnel. They report these issues to the top
management and try to resolve the issues.

HR in any organisation has multiple roles to play. No HR can perform just

one role. They may have to perform all the mentioned roles at different
stages in their career as HR personnel.

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Unit-1 Introduction to Human Resource Management

Summary

Human resource management is one of the most complex

and challenging field of management study. It mainly deals
with people dimension in management.
The primary objective of HRM is to take care of the work life
of employees even while ensuring their best possible
cooperation for achieving the organisational goals and
objectives.
The scope of HRM can be divided into HRM in personnel
management, HR in employee welfare, HR in industrial
relations.
Basically, HRM includes the four functions of acquiring,
developing, motivating and managing the human resources.
HRM functions are broadly classified into two categories
managerial and operative functions.
Managerial functions include planning, organising, directing
and controlling.
The specialist role of the HR professional takes a number of
roles, which is that of an auditor, service provider,
administrative expert, facilitator, consultant, the change
agent and employee advocate.
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Unit-1 Introduction to Human Resource Management

Check Your Learning

1.

Define Fringe benefits.

Ans: These are monetary and non-monetary benefits given

to employees during their employment and sometimes, also in the
post-employment period.

2.

Ans:

List the five managerial functions of HR department.

The five managerial functions of HR department are:

Planning
Organising
Staffing
Directing
Controlling

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Unit-1 Introduction to Human Resource Management

Activity

Activity 1
Visit a software organisation and find out the operative
functions of HR department.

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