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Human Resource Management

HRM in its basic meaning stands for managing the Human Resources. It is mostly concerned with the
management of the people working in the organization. Now-a-days in organizations, the role of HR is to
maximize the employees’ performance in its strategic goals.

Role of HRM in an Organization

It is now a known fact that HRM is concerned with the "people" & keeping the fact in mind that HRM
helps in acquiring, developing, stimulating & retaining the outstanding employees as it gives both
effectiveness & efficiency to the working of the organization. As they say “Right people for the Right
Job”. It is no less than a blessing that HR Department in any organization is responsible for this above
mentioned statement.

The primary goal of any HR Department is to generate strategic capability by ensuring that the
organization has the skilled, committed and well-motivated employees it needs to achieve sustained
competitive advantage. Organizations are implementing HR policies as a change agent, not to replace an
out dated personnel department that was mainly run by the Admin Department previously. Thus it can
be safely said that the HR performs the role of a key contributing element in the development of any
organization. As any organization is nothing without its employees or the people working for it. It is the
main asset of the organization.

How can HRM give Competitive Edge to an Organization

In this respect it is pertinent to note that the Competitive Edge is normally defined as the function of
specific skill sets, resources and capabilities that are considered valuable, rare and non imitable.

In today’s world, organization must be constantly alert to new way of gaining upper hand over the rivals.
Human Resource Management is such an area which helps an organization to perform well and to
become better then rivals. A well managed and organized HRM department is not only good for the
organization and thus increases the productivity of the company but also creates a favorable
environment of love and affection for the work.

All business professionals in the world would admit that Human Resource Department is an important
part of any business structure. One can have the best technologies, output capacities and equipment to

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produce and deliver the best product; however it may be not getting proper profits or may not be that
successful. The only reason is the poor management of the employee working for the organization.
Where as an HR management works at its best and the results can be depicted in the profits and gaining
more customer base with higher market shares.

In any organization, HR can be the most successful department which is more likely to produce a
competitive edge. It is because whatever HR does s directly related to the people. HR department hires
the best available people in the market for a company and as a result it reflects on the profits and
market share of the company. It is the one thing that can never be imitated.

The primary organization systems that affect employees are a business's HRM practices i.e. the set of
organizational activities that directly affect how employees perceive their jobs. These are:

 Organizational Design
 Staffing
 Employee & Organizational Development
 Performance Management
 Reward systems, Benefits and Compliance
 Communications and Public Relations
These functions define the proper working of an organization and thus help in gaining a competitive
advantage for it. A proper organizational design means how to achieve a goal while working in a formal
hierarchy, rules and regulations and proper Job Descriptions. Staffing is mainly concerned with the
criteria defined to hire an employee. It gives and organization a clear picture for recruiting new people
with great skills, defining their career paths, succession planning and formulation of programs for the
termination of employees. After that the HR develops an employee in to a proper resource for the
organization that can later help not only the personnel but also be useful in development of the
organization. Performance Management deals with the standards set or the employees to review their
performances. The major source of performance measurement of an employee is the client or the
customer that uses the product or service and hence decided about its fate in the market. After that the
rewards and benefits are given to the employees so as to encourage them to work more hard for the
betterment of the organization.

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All these functions contribute to the success of the organization. However following are the ways by
which Competitive Edge can be achieved in an organization:

1. Human Resource Information Systems (HRIS):

HRIS is a merger of HRM discipline with Information Technology. The HRIS provides a method by which
an organization collects, maintains, analyses and reports information on people and their job. It helps
HR managers perform HR functions in a more effective and systematic way using technology. It can be
useful in gaining a competitive advantage over others by faster information processing. A greater
information accuracy that is achieved by improved planning and program development it also enhances
employee communications and reduces the cost of stored data in HR. It also gives more transparency in
the system w i t h m o r e m e a n i n g f u l c a r e e r p l a n n i n g & counseling at all levels. And above all it
helps in responding to the Technological changes in the market.

2. Training and Development of Employees:

The principal objective of training and development division is to make sure the availability of a skilled
and willing workforce to an organization. The fundamental aim of training is to help the organization
achieve its purpose by adding value to its key resource – the “people” it employs. Training means
investing in the people to enable them to perform better and to empower them to make the best use of
their natural abilities. The particular objectives of training are to:
• Develop the competences of employees and improve their performance;
• Help people to grow within the organization in order that, as far as possible, its future needs for
human resource can be met from within;
• Reduce the learning time for employees starting in new jobs on appointment, transfers or promotion,
and ensure that they become fully competent as quickly and economically as possible.
How Training Benefits in achieving Competitive advantage
• Leads to improved profitability and/or more positive attitudes towards profit orientation.
• Improves the morale of the workforce.
• Helps people identify with organizational goals.
• Helps create a better corporate image.
• Fosters authenticity, openness and trust.

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• Improves relationship between boss and subordinate.

• Aids in organizational development.
• Learns from the trainee.
• Helps prepare guidelines for work.
• Aids in understanding and carrying out organizational policies.
• Provides information for future needs in all areas of the organization.
• Organization gets more effective decision-making and problem-solving skills
• Aids in development for promotion from within.
•Aids in developing leadership skills, motivation, loyalty, better attitudes, and other aspects that
successful workers and managers usually display.
• Aids in increasing productivity and/or quality of work.
• Helps keep costs down in many areas, e.g. production, personnel, administration, etc.
• Develops a sense of responsibility to the organization for being competent and knowledgeable.
• Improves Labour-management relations.
• Reduces outside consulting costs by utilizing competent internal consultation.
• Stimulates preventive management as opposed to putting out fires.
• Creates an appropriate climate for growth, communication.
• Aids in improving organizational communication.

3. HR Planning integration with Strategic Business Planning:

It is one of the most effective ways of achieving competitive advantage in any organization. Earlier there
were no HR departments, and then with the advent of HR departments, a new planning was done
known as HR planning. Now-a-days, companies are being forced to link human resource planning with
strategic business planning.
4. Compensation and Benefits:
By compensating the employees with best and market compatible salaries, a huge input can be added in
the competitive advantage. Any employee who is paid to the fullest and honest of his / her skill set will
in return give you the best product and service that will be beneficial for the user. He/ she will be
satisfied and thus can work well with absolute concentration and dedication to his /her work. Similarly,
by giving your employees benefits that are not common amongst the competitors also helps in gaining

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the competitive edge in the market. Annual leaves, Recreational trips and occasional greetings to
employees make them feel a part of the organization resulting in better working and higher profits.

CONCLUSION

HRM and competitive advantage go side by side in any organization now-a-days. They are co-related and
can do wonders for the organization. Today, the concept of globalised world has caused a great difficulty
for the organizations to stay ahead of their competition. The ability to attract the talent, select the best,
developing and upgrading skills, motivating innovation and retaining the valued employees will be the
key levers for firm success. Organization having good HRM managers and using good HRM strategies
gets good competitive advantage.