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MGT501 Human Resource

Management

By Waseem Ahmed and Vijay Kumar


23-October-2016

Personnel Management
Historical background

The Personal Management (PM) history begins in 19th century, their


creation was a reaction of harshness and industrial conditions, especially
for women and children.

In 19th century the leaders of large factories realized the need of


centralized body to manage labor, the real development of PM was
begun after WW-2.

The centralization started as personnel administration and developed


into a healthy PM

Initially PM was not so challenging, it was more about welfare,


consistency and improvement of employees related processes.

The PM was focused on basic HR processes mainly in the area of the HR


Administration like management of employees files, payroll processing,
timekeeping, interact with trade union, hiring and termination.

Personnel Management
Concept of Personnel Management

The real development of PM begun after the 2nd world war in 1945.

Organizations were pushed to voluntarily change their approach to


employees to gain competitive advantage.

The term (PM) and Human Resource Management (HRM) sometime


refer to the same processes. Human Resources is a modern term that
emerged during the 1970s and won final acceptance in 1989.

HRM historically known as PM, deals with formal system for the
management of the people within the organization.

The PM was a significant change in the way we work with people in the
organization, it represented one of the best improvement of workplace
conditions ever introduced.

Personnel Management
Concept of Personnel Management (continue )

There is no universal definition of PM however, the PM was the


evolutionary step in overall development of HRM.

They key goal of PM was designing cost-efficient processes and kept the
organization competitive.

Most organizations do not use PM as they recognize it is obsolete,


however many PM practices are still the best practice in the HR Admin.

Complete change of the approach to employees was not a primary goal


of PM introduction, in-fact it was a side-effect as companies realized
positive impacts on employees performance and productivity.

Handle labor laws and directly interact with labor and law-enforcement
authorities.

Personnel Management
Personnel Management vs Human Resource Management

HRM is new strategic approach of PM, the borderline between the PM


and HRM is not very sharp.

Evolution of HRM influenced by several factors like:


Globalization
Influence of notable academic institutions
Technological advancement
Diversity

Features that distinguish HRM from traditional PM


Explicitly linked with corporate strategy
Obtain the commitment from employees rather than only
compliance
Commitment obtained through consistent HR policies (reward,
training, appraisal, motivation etc.)
HRM is owned by line manager rather than centralized department

Personnel Management
Personnel Management vs Human Resource Management

HRM can be describe as


Long-term or Strategic
Proactive

PM can be describe as:


Short-term or Reactive
Compliance of defined rules and regulations

Personnel Management
PM and HRM - Current and past state

Personnel Management
Difference between PM and HRM
Personnel management is a traditional approach of managing people in the
organization. Human resource management is a modern approach of managing
people and their strengths in the organization.
Personnel management focuses on personnel administration, employee welfare
and labor relation. Human resource management focuses on acquisition,
development, motivation and maintenance of human resources in the
organization.
Personnel management assumes people as an input or source for achieving
desired output. Human resource management assumes people as an important
and valuable asset for achieving desired output.
Under personnel management, personnel function is undertaken for employee's
satisfaction. Under human resource management, administrative function is
undertaken for goal achievement.
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Personnel Management
Difference between PM and HRM Continue .1
Under personnel management, job design is done on the basis of division of
labor. Under human resource management, job design function is done on the
basis of group work/team work.
Under personnel management, employees are provided with less training and
development opportunities. Under human resource management, employees are
provided with more training and development opportunities.
In personnel management, decisions are made by the top management as per
the rules and regulation of the organization. In human resource management,
decisions are made collectively after considering employee's participation,
authority, decentralization, competitive environment etc.
Personnel management focuses on increased production and satisfied
employees. Human resource management focuses on effectiveness, culture,
productivity, employee's participation and engagement.
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Personnel Management
Difference between PM and HRM Continue .2
Personnel management is concerned with personnel manager. Human resource
management is concerned with all level of managers from top to bottom.
Personnel management is a routine function. Human resource management is a
strategic function.

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Personnel Management
Conclusion
Many researchers have been arguing on difficulty to distinguish Personnel
Management with Human Resource Management. Some believe that the
difference is just a change of label as Torrington (1989cited in Koster 2007)
said that there is no different in the content of Human resource
management. On the other hand, there are researchers such as Guest (1987
cited in Arsmtrong, 1999) who argued that Human resource management is
differentiated from traditional Personnel management.
However, HRM is concerned with performing the same functional activities
traditionally carried out by personnel function, but HRM approach performs
these functions in a qualitatively distinct way when compared with
personnel management (Storey, 1989).

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HRM represent a shift from traditional day to day HR operations to more


strategic alignment with organizations strategic objectives while PM only
concentrates on controls over employees and run day to day operations.

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