1.

1 INTRODUCTION

Of all the components of production namely land, labour, material, money and men -
the key factor is the management of the human component. Personnel
Administration may be described as a well founded, planned, executed and evaluated
approach to employee recruitment and development. It draws heavily on related
disciplines like psychology and sociology, law, economics, education and training.
The role of Personnel Administration in any activity has undergone a radical change
from record keeping, recruitment, and salary calculations to providing for employees'
welfare, boosting of morale, human resource allocation and utilisation. Personnel
Administration is elastic, flexible and changing as per the social values and needs of
the organisation.

It is necessary for executives to understand and appreciate Personnel Administration

to ensure that day-to-day personnel actions are consistent with policies. For non-
supervisory employees, it will help in their own compensation, training and career
development.

History

In the later part of the 18th century, the Industrial Revolution changed the way
people earned their living. One of the primary innovations of the Industrial
Revolution was beginning of the factory system. This system was primary responsible
for development of Personnel Administration (PM) because factories

 Replaced self employment ·

 Created a class of permanent wage earners ·
 Resulted in the rationalisation of work and the division of labour ·
 Necessitated management and supervision of a large number of workers

Initially factory managers were factory owners and Personnel practices tended to be
personal and paternalistic. Later, as factories grew in size, the owners/entrepreneurs
started delegating management responsibility to foremen or first line supervisors.
This management was characterized by use of force and fear.
The turn of the century saw dramatic industrial growth and organisation re-
structuring. This set the stage for modem Personnel practices. The three main
approaches were:

Scientific Management: which was an effort to deal with insufficiencies in labour

and management thought reorganisation of production methods and rationalisation
of work.

Welfare Work : which was concerned with efforts to deal with labour problems by
improving working conditions.

Industrial Psychology: which applied psychological principles to increase the

ability of workers to perform efficiently and effectively.

1.2 DEFINITIONS

'Personnel Administration is concerned with the most effective use of people to

accomplish organisational and individual goals. It is the way of managing people at
work so that they give their best to the organisation' . - Ivancevich & Guleck

'Personnel Administration is the planning, organising, directing and controlling of

the procurement, development, compensation, integration, maintenance and
separation of human resources so as to enable accomplishment of individual,
organisational and social objectives' . - Edward Flippo

'Personnel Administration is the recruitment, selection, development, utilisation of

and accommodation to human resources by an organisation'. - French

'Personnel Administration is responsible for the relationship of management to

employees, employees to employees and with development of the individual and the
group. The objective is to attain the maximum individual development, desirable
working relationships and obtain optimum output' . - Colt
summary of the definitions

1. Concerned with employees as individual but also as groups engaged in

attaining organisational goals.
2. Concerned with the development of the human resources to the maximum
possible extent, to help to derive greater satisfaction from the job. It is the
blending of skill, knowledge, capabilities, potentialities and total personality.
3. It covers all levels and categories of employees.
4. It is applicable to all types of organisations whether government, military or
nonprofit. It is inherent and omniscient.
5. It is a continuous function and requires constant alertness and awareness.
6. It focuses on attaining the goals of an organisation, society and personnel in
an integrated and consolidated way.
7. It aims at getting the willing cooperation of people.
8. It is the responsibility of all line managers as also the staff managers.

Thus, Personnel Administration is concerned with the procurement and

maintenance of capable and effective work force by motivating them to contribute
their optimum to the fulfillment of the organisational goals.

1.3 CONCEPT

On the basis of the above definition, a few basic facts and characteristics can be noted
about Personnel Administration.

First, Personnel Administration is concerned with managing people "At Work". Such
people are personnel and do not simply refer to rank and file employees or
"unionized labour." They also include "Hired personnel and non-unionized labour".
In other words it covers all levels of Personnel, including blue-collar and white-collar
employees. The shape and form that Personnel Administration takes may differ
greatly from company to company and to be effective, it must be tailored to fit the
individual needs of each organisation.
Second, it is concerned with employees both as individuals as well as a group. The
aim being to get better results with their cooperation and acti ve involvement in the
organisational activity.

Third, Personnel Administration is concerned with helping the employees to develop

their potentialities and capacities to the maximum possible extent so that they may
derive greater satisfaction from their jobs. This task takes into consideration four
basic elements, namely, the capacities, interest, opportunities and personality of the
employees. .

Capacities: Prefers to know abilities or accomplishments, inherited or acquired that

an employee has and is capable of exercising the same in his words.

Interests: Not only an individual's desires and ambitions, but also his instinctive,
impulsive tendencies and ill-defined cravings mayor may not stir him to his fullest
action in discharging his duties.

Opportunities: Not only opportunities for advancement, but opportunities to exercise

his capacities and satisfy his interests and personality are necessary. For the sum
total of a workers' reaction to his experiences and environmental, personality is
manifest by an individual's reception by others.

Fourth, since recruitment, selection, development and utilisation of and

accommodation to people are an integral part of any organisational effort, PAis
inherent in all organisations. It i not confined to industry alone, it is useful and
effective in government departments, military organisations and non-profit
institutions.

Fifth, Personnel Administration is of a continuous nature. It cannot be turned on and

off . e an electric button, it cannot be practiced only one hour each day. PA requires a
constant diligence and awareness of human relations and their relevance in every
operation.
Finally, Personnel Administration attempts at getting the willing cooperation of the
people for the attainment of the desired goals.
1.4 OBJECTIVES

1. To maintain good human relations.

2. To enable each person to make his maximum personal contribution as an
individual and as a member of a group.
3. To achieve these objectives through respect and dignity of the Labour.
4. Scientific recruitment and to retain employees and also to release them if
performance is not satisfactory.
5. To generate maximum individual/group development by offering
opportunities for advancement through training and enrichment of job.
6. To provide acceptable leadership.
7. To provide fair and just conditions of work.
8. Ensure compliance with laws.

Significance of personnel administration

1. It helps in attracting and retaining capable personnel through proper planning.

2. It helps to identify the best talent for available jobs through recruitment and
scientific selection process.
3. Through performance appraisal and training, it enables the individual to develop
advanced skill, knowledge and attitude.
4. It motivates the personnel to achieve excellence in work.

Activity A :
Describe any two concepts and objectives of personnel administration applicable to
your organisation.
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1.5 NATURE, SCOPE AND FUNCTIONS

In view of the complexities of human nature, management of men to obtain results

through willing cooperation is a constant challenge. It is the man, not machines,
material or money who make or mar any organisation or permeate all types of
functional management such as production, finance, marketing and research. It is
conservative in contrast with marketing research, product development and
advertising. Developments in PA have derived from personnel research. The scope
and areas of the personnel function are broadened and new problem areas have
emerged due to changes in environment.

The behavioural sciences - psychology, sociology, law, etc. contribute in Personnel

Administration. Behavioural scientists have offered important viewpoints regarding
job satisfaction, motivation and leadership.

Fig 1.1 : Functions of personnel administration

A ) Managerial Functions

a) Planning: Planning is concerned with a conscious determination of the course of

action required to achieve the predetermined objectives. It involves the selection
from among alternatives of objectives, policies, procedures and programmes. It is
thus decision making affecting the future course of action of an enterprise or
department. Thus, planning means deciding in advance what, when, where, why,
how and by whom it is to be done. For the personnel manager, planning means
deciding personnel programmes in advance, i.e., how many or what type of men are
required? How and whom to motivate or direct them and so on? -

b) Organising : Organisation is a tool for achieving the objectives in a planned

manner. It creates a framework of authority and responsibility within which the
functions of management will be discharged. To achieve a common purpose,
organisation calls for i) the preparation of task force ii) the allocation of work to
individuals iii) the integration of the efforts of the task force recruited and the
assigned work iv) the coordination of work of individual with that of the department.

c) Directing: It means limitation of organised action and stimulating the people to

work. In other words, it involves motivation and leadership. However, in the good
planning the management may have attempted or the best possible organisation set
up might have been provided, the organisation cannot achieve the desired results if
direction fails. Direction involves issuance of orders and motivation of workers to
comply these orders so that people may follow the path laid down in advance.

d) Controlling: It is the most important function of the management. Controlling

means regulating the activities of the personnel department in accordance with the
personnel plans. It involves the observation and comparison of results with the
predetermined targets and correcting the deviations, if any. It suggests various
measures to rectify any mistake in the execution of plans. It helps the personnel
manager in evaluating the performance of the personnel department and formulating
the future plans taking into consideration the variations observed in the course of
action.

B) Operative Functions

The personnel department invariably performs the following operative functions or

service functions or routine functions:

i) Procurement of Personnel: The first operative function of the personnel

department is the procurement of an adequate number of qualified persons
necessary to achieve the objectives of the organisation. It involves recruitment,
selection and placement etc. of personnel.

ii) Development of Personnel : After the proper placement of workers on

various jobs, the Personnel Department is concerned with the development of
workers to make them able to do their work efficiently. It will increase their
productivity.
It involves training programmes, formulating policies relating to promotion,
transfer, motivation, performance rating, displacement and retirement.

iii) Compensation to Employees : This function of personnel department is

concerned with the fixing of an adequate and equitable remuneration of the
personnel for their contribution towards achieving the organisational goals.
Personnel can be compensated in terms of monetary and non-monetary units.
For this purpose all equitable wage and salary policies must be formulated taking
into consideration the basic needs of the people, requirements of the jobs, provisions
of the law regarding minimum wages, capacity of organisation to pay, wage levels of
the competitors etc. Sufficient provisions like a bonus, incentive, retirement benefits,
perquisites and wage plans etc. should also be made in the wage policy for motivating
the people.

iv) Integration: It involves a reasonable integration of the interests of the

personnel with that of the organisation. The main problems involved in this function
are poor communication and indiscipline. The personnel manager should provide an
efficient system of communication to ensure two-way traffic of personnel programme
and policies, because many a times, industrial disputes arise only because of poor
communication. He should also be in touch with the grievances of the people at work
and keep himself in contact with the trade unions to understand their grievances,
must hold talks with their representatives in order to remove and/or minimize them
so that harmony and discipline may be maintained in the organisation.

v) Maintenance of Personnel: Maintenance of work force is also one of the most

important functions of the Personnel Administration. Maintenance of personnel
means to keep the workers engaged in work with full loyalty to their jobs and to the
organisation. 'This function involves provisions of better working conditions and
Labour welfare activities such as medical benefits, housing facilities, recreational
facilities, rest rooms, canteens etc.

The above classification of functions of personnel department is an ideal

classification and in a particular organisation, it may vary according to its nature of
work, size and form of business organisation; but they must be arranged so as to get
the maximum return from the investment made in' human resources.

Activity B :

Describe at least two functions each of managerial and operative functions of

personnel administration applicable to your organisation.
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1.6 PRINCIPLES OF PERSONNEL ADMINISTRATION

Principles of PA are the guidelines for the executives in administering and directing
the personnel policies on a rational basis. Different persons have presented the
principles of PA in different ways. The following are some of the principles generally
accepted by the management:

1. Principle of maximum individual development

2. Principle of scientific selection
3. Principle of high moral
4. Principle of effective communication
5. Principle of dignity of labour
6. Principle of team spirit
7. Principle of fair reward
8. Principle of co-partnership
9. Principle of effective utilisation of human resources
10. Principle of contribution to national prosperity
Scientific Management

The father of Scientific Management was Frederick W. Taylor. He studied workers'

efficiency and attempted to discover "on~ best way" and the one fastest way to do a
job.
Taylor summarized Scientific Management as:
· Science, not rule of thumb
· Harmony, not to discard
· Co-operation, not individualism
· Maximum output in place of restricted output

Welfare Work

Welfare work was an effort to improve the intellectual and social comfort of
employees through means that was not necessarily required by law. The primary
objective of welfare work was to avert industrial conflict and unionisation, promote
good management and worker relations, increase worker productivity and reduce
manpower turnover.

Industrial Psychology

Industrial psychology focused on the worker and individual differences. The

objective of industrial psychology was to increase human efficiency by emphasisis
worker well-being and decreasing psychological and psychological costs of work.

There is no specific date assigned to the appearance of the first Personnel

department. However, around 1920s more and more organisations took note of and
attempted to do something about the conflict between employees and management.
Another movement, which contributed to Personnel Administration was the human
relations movement. Two Harvard researchers, Elton Mayo and Fritz
Roethlisberger, incorporated human factors into work. A series of studies conducted
at the Hawthorne facility of Western Electric in Chicago between 1924 and 1933
highlighted the importance of social interaction among work groups on output and
satisfaction. The human relations movement became a branch of and a contributor to
the field of Organisational Behaviour.

Quality of work life era

until the 1960s, the major concern of the human resources function was considered
to be only industrial relations. In the 60s and 70s, laws were passed to satisfy
interests of both employers and employees and to eliminate discrimination in
employment conditions due to sex, religion, race, age, or national origin. Besides,
changes in cultural values, economy, technology and such other factors necessitated
a change in management's attitudes towards the work force.

The role of the personnel department became more proactive and the department's
success was ought to be measured by the contribution it made to the company's
profitability. The personnel department was no longer a welfare department,
performing clerical jobs or fire fighting. The role of the effective personnel
department was to develop a harmonious relationship between the company and its
employees so that employees were committed, involved, imbibed and enriched the
culture of the organisation.

The personnel function today

The personnel function today is different from that in the past because it is involved
in meeting the needs of a changing environment. Today, the role of personnel
administration includes

 Involvement in overall organisational planning and change

 creation of organisational culture and facilitation of organisational
commitment
 decentralization of traditional personnel administration activities from
personnel specialist to line managers
The change has been necessitated because of
 rapid change in technology
 emergence of new competitive organisations
 Decentralization, de-layering and empowerment which have increased
personnel responsibilities.
 Reduction in the power of collective bargaining, which had made personnel
professional's key players in industrial relations.
 Attitude change enabling all levels in the organisation to focus on continuous
improvement processes by using concrete performance-related information.

Therefore the personnel department has to

 Cut cost by reducing radically the ratio between staff and line jobs

 Change focus from an administrative, service delivery approach to a role

providing guidance and advice to line management.

The personnel administration function has now become broad based and strategic
involving all managerial personnel and regarding employees as the most important
organisational asset. PM acts proactively to enhance organisational performance
while meeting employee requirements. _"

1.7 CHARACTERISTICS AND QUALITIES OF A PERSONNEL MANAGER

Personnel Manager has to have support of the top management. He also has to earn
the respect of his colleagues especially those in the line who are interested in
immediate rather than long-term results. Tact and imagination are his main guides.

He has to be a specialist in organisation theory and as such be an effective advisor to

top management and also to organise his own department in such a manner as to
minimize frictions, promote goodwill and release the latent energies. He should have
a real expertise in personnel administration. He must also have a keen sense of social
justice and be fully appreciative of the rights and interests of the men and women at
work as well as the economic needs of the management. His philosophy of social
justice should include two fundamental concepts i) Industry is a partnership between
management, men and owners whose objective is to eam profits through service ii)
Industry can profit greatly by developing and coordinating the capacities, the interest
and opportunities of each member. He has to couple this sense of social justice with a
warm personnel interest in people.

The other important qualities that a personnel manager should possess

are:

1. A mind with a capacity for creative thinking, for analysing situations and
reasoning objectively.

2. He should know problem-solving techniques and have an ability to inspire,

motivate and direct employees.

3. A devoted sense of vocation and faith in humanity.

4. Capacity for leadership, a sense of social responsibility and a standard of

social justice.

5. Personal integrity so that employees may repose confidence in him.

6. Capacity for persuasion, coupled with patience and tolerance.

7. A friendly, approachable nature which is tactful and sympathetic and a

pleasing personality, a well-groomed appearance, sophisticated taste and
habits and capable of working with and through other people.

8. Initiative and decision making ability.

9. Mobility of facial expression (which encourages confidence, conveys interest,

registers sympathy and allays distrust).
 10. An ability to generate trust among his colleagues and develop acceptability,
recognition for himself and his ideas, with fluency in communication.

11. A readiness to cooperate with the subordinates in times of difficulty and never
to interfere or thrust his advice on them; and finally,

12. A promptitude in giving them the feedback in their handling of personnel

matters whenever necessary, in the interest of the functioning of the
organisation and established personnel policies of the company.

In short, personnel man must be a person who has the human relation skills, a
sensibility to behavioural issues and a conceptual skill to see the broad picture and
predict situations rather than react to the problems.

The Role of a Personnel Administrator

Fig 1.2 : Role of a personnel administrator

1.8 DEVELOPMENT OF PERSONNEL ADMINISTRATION IN INDIA

Development of scientific management and social awakening in the west at the end
of 19th century were the main causes for the growth of Personnel Administration.
The term 'Personnel Administration' which originated in USA gained a wide
popularity throughout the industrial world and is now taken as synonymous with
other terms like Labour welfare, labour management relations, industrial relations,
human relation in industry etc.

Actually with the development of big business organisations and mounting labour
problems, there was a greater realisation in both, the public and private sectors, for
the appointment of a staff line officer to assist the top executives in organisation in
maintaining the industrial peace that are considered to be equal partners in the
industrial system.

The development of Personnel Administration in India is quite different from the

development of personnel department in England and America. In UK and USA, the
business house provided the better Labour welfare facilities voluntarily whereas in
India, labour management relations were developed mainly due to the unsatisfactory
recruitment systems, more and more labour agitations and statutory provisions of
the various acts to improve the working conditions of labour in industries.

The development of Personnel Administration in India can be studied under two

captions namely
i) Development before independence and
ii) Development in the post dependence era.

Development before independence

Before independence nothing commendable was done either on the part of

employers or on the part of the government for the development of industrial
relations. The development of personnel administration in India was as late as in
1920 when labour welfare activities -ere initiated by some Indian business
enterprises like the Tata Group, British India Corporation, Calico Mills, Empress Mill
and the appointment of labour welfare officers to oak after the interests of the
working people and of enterprises in relation to the human problems.

The year 1920 was witnessed as the year of industrial unrest. Some employers as well
as the Government took various steps to resolve better industrial relations, including
the recognition of trade unions. But on the whole, satisfactory progress in industrial
relations could not be seen.

Before and during World War II, the Government was the leading agency in India to
develop and improve labour relations in Indian industries. In 1934, with the efforts
of the Bombay Government, the appointment of labour welfare officers was made
compulsory in industries throughout the state of Bombay to resolve labour disputes
with a Labour commissioner as the Chief Conciliation Officer. With this initiative,
industries in other states also appointed the labour officers.

In 1939, Royal Commission on Labour also recommended the appointment of labour

officers so that labour problems might be reconciled amicably. In 1984, the Union
Government convened in tripartite Labour conferences to discuss the extent of
Labour laws in Indian industries, to evolve a system of grievances handling and to
establish conciliation system in industrial matters.

Development in post independence period

Government of India did commendable work in this direction in the post

independence period. Several Labour legislations were enacted, such as the Labour
Disputes Act, 1947, Industrial Employment Act, 1946, Factories Act, 1948 etc. on the
recommendations of the Central Labour Investigation Committee, 1946. The
Factories Act, 1948 provides the appointment of a Labour Welfare Officer for the
workers as enunciated in the act. But now the urgency of appointing a Personnel or
Labour Officer is being felt even in such industries where there is no legal
compulsion to appoint a welfare officer. It is because there is a need of such agency to
guide the management in tackling the ticklish labour problems by providing these
specialised services.

The services of these Labour Welfare Officers are not appreciable even now because
they take a biased view about themselves. While dealing with the workers, they
consider themselves as agents of the management.

The government has also arranged for the training of workers and management
personnel in India and started several training centers and institutes for imparting
training in industrial relations. For the first time in Independent India, the 'Xavier
Institute of Labour Relations' was established in 1949 and several other institutions
were started later on such as Indian Institute of Personnel Administration, Calcutta,
Indian Labour Management Institute, Mumbai, Institute of Industrial Relation,
Bangalore, Federation of All India Labour Welfare Officers, Delhi and Indian
Productivity Councils Sri Ram center for Industrial Relations and Human Resources.
In the middle of 1975, the government proclaimed the state of emergency in India
and took several administrative steps to eradicate the system of Bonded Labour, to
give momentum to the scheme of workers' participation in management in Indian
industries and to extend the scheme of apprenticeship.

In 1978, a comprehensive Industrial Relation Bill was introduced in Parliament in

order to improve labour relations in industries through collective bargaining by
consolidating the Trade Union Act 1926, Industrial Employment Act, 1946 and the
Industrial Disputes Act, 1947. But due to the dissolution ofLok Sabha in 1979, the bill
could not be passed. In 1981, the president promulgated an ordinance giving powers
to the Government to ban strikes in essential services for six months. The essential
services include Railways, Post and Telegraph, Telephone, Docks, Airports, Banks,
Petroleum, Water and Sewer disposal, Defence and hospitals. The Government was
empowered to declare any service as an essential service.

In 1982, Government amended several Labour laws including Industrial Disputes

Act; Industrial Employment Act 1946. The Government also amended the Employees
State Insurance Act in 1984 and 2004.

Presently, the need of Personnel Administration has been widely recognised as a

specialised function of the management that nearly all the organisations prefer to
establish a personnel department to deal with the working force in the enterprise.

1.9 FUTURE OF PERSONNEL ADMINISTRATION IN INDIA

A historical review of the development of the PA in India reveals that the efforts for
improving the Labour relations in Indian industries were made largely in post
independence era by the Central and State Government. Today, the importance of
Personnel Administration has been so widely recognised that nearly all the
organisations realise the need of establishing personnel department to ensure better
industrial relations.
The scope of Personnel Administration has also undergone considerable changes and
has expanded to cover
i) the human and social implications of work and organisation
ii) recruitment, selection, promotion and development of employees
iii) relations between employer and employees and their recognised trade
unions
iv) terms and conditions of employment, fixation of wage and allowances,
fringe benefits, health safety, welfare and employee services
v) importance of collective bargaining etc.

though, a considerable improvement has been noticed in industrial relations in India

since independence, yet the pace of personnel development is very slow. The attitude
of Indian industrialists towards Labour is apathetic and they do not regard them
more than a factor of production. That is why tl1ey concentrate all efforts on the
financial achievements rather on the development of human resources. The principle
of maximum return by the effective utilisation of manpower has not been given due
recognition and therefore the personnel practices and policies have been
implemented in Indian industries by circumstances and not as a part of the
organisational behaviour.

Taking in view the above situation, there are many possibilities for the development
of Personnel Administration in India because industrial development is progressing
very fast. In order to solve many problems arising out of industrial development, it
became very necessary to develop the science of PA. It shall be possible only when
there is a revolution in the minds of Indian industrialists. They must feel that
workers are human beings and the human treatment must be given to them. They
must realise that workers are partners in the industry and can contribute much to the
national prosperity. If the Indian industrialists are not prepared to change their
attitude towards the Labour, much cannot be expected from the Governn1ent alone
for the development of Healthy Industrial Relations. Thus, the future of the
Personnel Administration in India depends much upon change in the attitude of the
industrialists towards the Labour.
Activity C :

Describe important stages of development of personnel administration during pre

and post-independence period of India.
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1.10 DIFFERENCE BETWEEN PERSONNEL MANAGEMENT AND
HUMAN RESOURCE MANAGEMENT

Definition of Personnel Management : Personnel management is basically an

administrative record keeping function, at the operational level. Personnel
management attempts to maintain fair terms and conditions of employment, while at
the same time, efficiently managing personnel activities for individual departments
etc. It is assumed that the outcomes from providing justice and achieving efficiency
in the management of personnel activities will result ultimately in achieving
organizational success.

Definition of Human Resource Management : Human resource management

is concerned with the development and implementation of people strategies, which
are integrated with corporate strategies and ensures that the culture, values and
structure of the organisation as well as the quality, motivation and commitment of its
members contribute fully to the achievement of its goals.

HRM is concerned with carrying out the SAME functional activities traditionally
performed by the personnel function, such as HR planning, job analysis, recruitment
and selection, employee relations, performance management, employee appraisals,
compensation management, training and development etc. But, the HRM approach
performs these functions in a qualitatively DISTINCT way, when compared with
Personnel Management.

Main Differences between Personnel Management and HRM

. Personnel management is workforce centered, directed mainly at the organisation's

employees; such as finding and training them, arranging for them to be paid,
explaining management's expectations, justifying management's actions etc. While
on the other hand, HRM is resource - centered, directed mainly at management, in
terms of developing the responsibility of HRM to line management, management
development

although indisputably a management function, personnel management has never

totally identified with management interests, as it becomes ineffective when not able
to understand and articulate the aspirations and views of the workforce, just as sales
representatives have to understand and articulate the aspirations of the customers.

personnel Management is basically an operational function, concerned primarily

with carrying out the day-to day people management activities. While on the other
hand. HRM is strategic in nature, that is, being concerned with directly assisting an
organisation to gain sustained competitive advantage.

HRM is more proactive than Personnel Management whereas personnel

management is about the maintenance of personnel and administrative systems.,
HRM is about the forecasting of organisational needs, the continual monitoring and
adjustment of personnel system to meet current and future requirements, and the
management of change.

Personal management (PM) deals with people at work and their relationship with
each other. The three dimensions of PM containing several mechanisms are as. . .

Personnel Aspect - Recruitment, selection, placement, training, appraisal,

compensation, productivity etc.
welfare Aspect - Working conditions, amenities, facilities, benefits, etc.

Industrial relations Aspects - Union management relations, disputes settlement,

grievance handling, discipline, collective bargaining etc.

Human Resource Management (HRM) is a planned way of developing individual

employees, group and the total organisation to achieve organisational goal in an
atmosphere of mutual trust and cooperation. The mechanisms of HRM are as
follows:

 Performance Appraisal
 Potential Appraisal
 Training and management development
 Reviews discussion, feedback, counseling sessions
 Role analysis
 Communication policies
 Rewards
 OD exercises
 Job enrichment program
 Job rotation and
 Other mechanisms
1.11 SUMMARY

In this unit, we have discussed the history of personnel administration and

understood various definitions and concepts of personnel administration. We have
also understood the contribution of scientific management, welfare work and
industrial psychology to personnel administration. The characteristics and qualities
of personnel managers, the development and future of personnel administration in
India have also been elaborated in details.
1.12 KEYWORDS

Resource Management: Human resource management is concerned with the

development and implementation of people strategies, which are integrated with
corporate strategies and ensures that the culture, values and structure of the
organisation and the quality, motivation and commitment of its members contribute
fully to the achievement of its goals.

Personnel Administration: It is concerned with the most effective use of people

to accomplish organisational and individual goals. It is the way of managing people
at work so they give their best to the organisation'

Planning: Planning is concerned with conscious determination of the course of

action required to achieve the predetermined objectives. It involves the selection
from among alternatives of objectives, policies, procedures and programmes. Thus,
planning means deciding in advance what, when, .where, why, how and by whom it is
to be done.

Personnel Management: Personnel management is basically an administrative

record keeping function, at the operational level. Personnel management attempts to
maintain fair terms and conditions of employment, while at the same time, efficiently
managing personnel activities for individual departments etc.

1.13 SELF -ASSESSMENT QUESTIONS

Q1:- How did the industrial revolution influence the role of personnel
administration?

Q2:- Why did the emergence of factories necessitate personnel administration?

Q3: Describe how scientific management, welfare work and industrial psychology
contributed to the development of PM practices,
Q4:- In What way is the role of PM today different from the earlier one?