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HUMAN RESOURCE MANAGEMENT

Page 1 of 74 - Human Resource Management Notes


Jamnalal Bajaj Institute of Mgmt Studies
Mgmt study material created/ compiled by - Commander RK Singh rajeshsingh_r_k@rediffmail.com

INDEX

SL SUBJECT PAGE
1. HUMAN RESOURCE MANAGEMENT ( H R M ) 3
STRATEGIC HUMAN RESOURCE 9
2.
MANAGEMENT
3. HUMAN RESOURCE DEVELOPMENT 11
4. TEAM EFFECTIVENESS 13
5. HUMAN RESOURCE PLANNING ( H R P ) 14
6. JOB ANALYSIS 20
7. JOB DESCRIPTION 21
8. JOB SPECIFICATION 22
9. JOB EVALUATION 23
10. JOB DESIGN 25
11. JOB SATISFACTION 28
12. WORK SAMPLING 28
13. RECRUITMENT 31
14. SELECTION 35
15. TRAINING & DEVELOPMENT 38
16. INDUCTION & ORIENATION 44
17. MULTI-SKILLING 47
18. CHANGE MANAGEMENT 49
19. PERFORMANCE APPRAISALS 56
20. HUMAN RESOURCE AUDIT 62
21. MOTIVATION THEORIES 64
22. MORALE 67
23. PERSONNEL POLICIES 68
24. UNIONS 71
25. ORGANIZATIONAL DOWNSIZING 73

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Jamnalal Bajaj Institute of Mgmt Studies
Mgmt study material created/ compiled by - Commander RK Singh rajeshsingh_r_k@rediffmail.com

WHAT IS HRM?

MEANING OF HRM

HRM is a management function that helps organisation to recruit, select, train, develop and
manage its members. Simply stated, HRM is all about management of people in the
organisation from Recruitment to Retirement. HRM refers to set of programs, functions,
and activities designed and carried out in order to maximise both employee as well as
organisational effectiveness.

Definition 1

“HRM is planning, organizing, directing and controlling of the procurement, development,


compensation, integration, maintenance and separation of human resources to the end that
individual, organizational and social objectives are accomplished.”

Definition 2

“HRM is concerned with the people dimensions in management. Since every organization
is made up of people, acquiring their services, developing their skills, motivating them to
higher levels of performance and ensuring that they continue to maintain their commitment
to the organization are essential to achieving organizational objectives. This is true,
regardless of the type of the organization – government, business, education, health,
recreational, or social action.”

OBJECTIVES OF HRM

1. Organizational Objectives: To assist the organization to achieve its primary


objectives, whether it is profit making or charity or social agenda.

2. Societal Objectives: To be responsive to the needs and challenges of the society


while minimizing the negative impact, if any, of such demands upon the organization.

3. Functional Objectives : To maintain department’s contribution and level of


services at a level appropriate to the organization’s needs.

4. Personal Objectives: To assist employees in achieving their personal goals, at least


in so far as these goals enhance the individual’s contribution to the organization. This is
necessary to maintain employee performance and satisfaction for the purpose of
maintaining, retaining and motivating the employees in the organization.

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Mgmt study material created/ compiled by - Commander RK Singh rajeshsingh_r_k@rediffmail.com

SCOPE OF HRM

From Entry to Exit or Recruitment to Retirement of an employee in the organization

Following are the areas of operation of HRM:


1. Human Resource Planning
2. Job Analysis
3. Job Design
4. Recruitment & Selection
5. Orientation & Placement
6. Training & Development
7. Performance Appraisals
8. Job Evaluation
9. Employee and Executive Remuneration
10. Motivation
11. Communication
12. Welfare
13. Safety & Health
14. Industrial Relations

Based on the above activities, we can summarize the scope of HRM into following seven
different categories:
1. Introduction to HRM
2. Employee Hiring
3. Employee and Executive Remuneration
4. Employee Motivation
5. Employee Maintenance
6. Industrial Relations
7. Prospects of HRM

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Mgmt study material created/ compiled by - Commander RK Singh rajeshsingh_r_k@rediffmail.com

ROLE OF HRM

1. Advisory Role: HRM advises management on the solutions to any problems


affecting people, personnel policies and procedures.
(a) Personnel Policies: Organization Structure, Social Responsibility,
Employment Terms & Conditions, Compensation, Career & Promotion, Training &
Development and Industrial Relations.
(b) Personnel Procedures: Relating to manpower planning procedures,
recruitment and selection procedures, and employment procedures, training procedures,
management development procedures, performance appraisal procedures, compensation
procedures, industrial relations procedures and health and safety procedures.

2. Functional Role: The personnel function formulates personnel policies in


accordance with the company’s doctrine and management guidelines. It provides guidance
to managers to help them ensure that agreed policies are implemented.

3. Service Role: Personnel function provides personnel services. These services


constitute the main activities carried out by personnel department, like payroll, disciplinary
actions, etc, and involve the implementation of the policies and procedures described
above.

ROLE OF HR MANAGERS

1. Humanitarian Role: Reminding moral and ethical obligations to employees.


2. Counsellor: Consultations to employees about marital, health, mental, physical and
career problems.
3. Mediator: Playing the role of a peacemaker during disputes, conflicts between
individuals and groups or management.
4. Spokesman: To represent the company in Media and other forums because he has
better overall picture of his company’s operations.
5. Problem Solver: Solving problems of overall human resource management and long-
term organizational planning.
6. Change Agent: Introducing and implementing institutional changes and installing
organizational development programs
7. Management of Manpower Resources: Broadly concerned with leadership both in
the group and individual relationships and labour-management relations.

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Mgmt study material created/ compiled by - Commander RK Singh rajeshsingh_r_k@rediffmail.com

OBJECTIVES V/s FUNCTIONS OF HRM

HRM Objectives Supporting HRM Functions


Social Objectives (3) (a) Legal Compliance
(b) Benefits
(c) Union Management
Relations
Organizational Objectives (7) (a) Human Resource Planning
(b) Employee Relations
(c) Recruitment & Selection
(d) Training & Development
(e) Performance Appraisals
(f) Placement & Orientation
(g) Employee Assessment
Functional Objectives (3) (a) Performance Appraisals
(b) Placement & Orientation
(c) Employee Assessment
Personal Objectives (5) (a) Training & Development
(b) Performance Appraisals
(c) Placement & Orientation
(d) Compensation
(e) Employee Assessment

MANAGERIAL FUNCTIONS OF HRM

1. Planning: Research and plan about wage trends, labour market conditions, union
demands and other personnel benefits. Forecasting manpower needs etc.
2. Organizing: Organizing manpower for the achievement of organizational goals and
objectives.
3. Staffing: Recruitment & Selection
4. Directing: Issuance of orders and instructions, providing guidance and motivation to
managers and employees.
5. Controlling: Regulating personnel activities and policies according to plans.
Observations and comparisons of deviations

OPERATIONAL FUNCTIONS OF HRM

1. Procurement: Planning, Recruitment and Selection, Induction and Placement


2. Development: Training, Development, Career planning and counselling.

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Mgmt study material created/ compiled by - Commander RK Singh rajeshsingh_r_k@rediffmail.com

3. Compensation: Wage and Salary determination and administration


4. Integration: Integration of human resources with organization.
5. Maintenance: Sustaining and improving working conditions, retentions, employee
communication
6. Separations: Managing separations caused by resignations, terminations, lay offs,
death, medical sickness etc.

CHALLENGES OF HRM IN INDIAN ECONOMY

The job of HRM department in India has never been so challenging. Last decade has
witnessed tectonic shift in Job market. From being an employer’s market, it has suddenly
turned into employee’s market, especially in the most crucial segment, ie middle
management. Globalisation and India’s growing stature in the world has seen demand for
Indian managers soaring. From the state of plenty, there is a stage of scarcity of the right
talent. The biggest challenge is to retain the talent one has so assiduously hunted and
trained. The attrition rate has reached alarming proportions. It has reached such proportions
that certain segments of Industry are maintaining bench strengths to fill in the sudden gaps
due to resignations. In addition, there are following new issues:

1. Globalization: Growing internationalization of business and workforce has its


impact on HRM in terms of problems of unfamiliar laws, languages, practices,
attitudes, management styles, work ethics and more. HR managers have a challenge to
deal with more and more heterogeneous functions and more involvement in employee’s
personal life.

Corporate Re-organizations: Liberalisation has led to largescale reorganization of


businesses in terms of expansions, mergers and acquisitions, joint ventures, take
overs, and internal restructuring of organizations. In circumstances as dynamic
and as uncertain as these, it is a challenge to manage employees’ anxiety,
uncertainties, insecurities and fears.

New Organizational Forms: Exposure to international business and practices have


led to change in the organisational structure and HR policies of the local
companies. Take for instance, the hierarchical structure of Indian companies.
Suddenly, Indian companies have begun to adopt flat hierarchical management
structure. But to implement and grout such fundamental changes in management
philosophy of any company is never easy. The challenge for HRM is to cope with
the implications of these new relations in place of well established hierarchical
relationships that existed within the organizations for ages in the past.

2. Changing Demographics of Workforce: Changes in workforce are largely


reflected by dual career couples, large chunk of young blood with contrasting ethos of
work among old superannuating employees, growing number of women in workforce,

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Mgmt study material created/ compiled by - Commander RK Singh rajeshsingh_r_k@rediffmail.com

working mothers, more educated and aware workers etc. Thus, changing demography
of workforce has its own implications for HR managers and a true challenge to handle.

3. Changed Employee Expectations: With the changes in workforce


demographics, employee expectations and attitudes have also transformed. Traditional
allurements like job security, house, and remunerations are not much attractive today.
Rather, employees are demanding empowerment and equality with management.
Hence, it is a challenge for HRM to redesign the profile of workers, and discover new
methods of hiring, training, remunerating and motivating employees.

New Industrial Relations Approach: In the changed industrial climate, even trade
unions have realised that strikes and militancy have lost their relevance and not
many workers are willing to join them and disrupt work. However, the problems
faced by workforce now have different dimension for the management. They
manifest in the form of increased attrition rate. Unsatisfied employees instead of
approaching the management for resolution, often take up the new job. The
challenge before the HRM is find ways and means to feel the pulse of employees
and address the issues on proactive basis.

Renewed People Focus: “Man behind the machine is most important than the
machine”. This is an old doctrine of the Armed Forces. However, this doctrine has
begun to gain acceptance in the corporate world and thus all out efforts to grab the
best talent at what ever cost.

4. Managing the Managers: Managing the managers is most difficult. Armed with
inside information, they can not be lured with rosy promises. They are in great demand
too with growth in economy. These are the people who are most mobile, attrition rate
being highest for the junior and middle management level. The challenge of HRM is
how to manage this tribe?

5. Weaker Section’s Interests: Another challenge for HRM is to protect the interest
of weaker sections of society. The dramatic increase of women workers, minorities and
other backward communities in the workforce, coupled with weakening of trade unions,
has resulted in the need for organizations to re-examine their policies, practices and
values. In the name of global competition, productivity and quality, the interests of the
society around should not be sacrificed. It is a challenge of today’s HR managers to see
that these weaker sections are neither denied their rightful jobs nor are discriminated
while in service.

6. Contribution to the Success of Organizations: The biggest challenge to an


HR manager is to make all employees contribute to the success of the organization in
an ethical and socially responsible way. Because society’s well being to a large extent
depends on its organizations.

Page 8 of 74 - Human Resource Management Notes


Jamnalal Bajaj Institute of Mgmt Studies
Mgmt study material created/ compiled by - Commander RK Singh rajeshsingh_r_k@rediffmail.com

STRATEGIC HUMAN RESOURCE


MANAGEMENT
Strategy:
“Strategy is a way of doing something. It includes the formulation of goals and setting of
action plans for accomplishment of that goal.”

Strategic Management:
“A Process of formulating, implementing and evaluating business strategies to achieve
organizational objectives is called Strategic Management”

Definition of Strategic Management


“Strategic Management is that set of managerial decisions and actions that determine the
long-term performance of a corporation. It includes environmental scanning, strategy
formulation, strategy implementation, evaluation and control.”

The study of strategic management therefore emphasizes monitoring and evaluating


environmental opportunities and threats in the light of a corporation’s strengths and
weaknesses.

STEPS IN STRATEGIC MANAGEMENT

1. Environmental Scanning: Analyze the Opportunities and Threats in External


Environment
2. Strategy Formulation: Formulate Strategies to match Strengths and Weaknesses. It
can be done at Corporate level, Business Unit Level and Functional Level.
3. Strategy Implementation: Implement the Strategies
4. Evaluation & Control: Ensure the organizational objectives are met.

IMPORTANCE & BENEFITS OF STRATEGIC


MANAGEMENT

1. Allows identification, prioritization and exploration of opportunities.


2. Provides an objective view of management problems.
3. Represents framework for improved co-ordination and control
4. Minimizes the effects of adverse conditions and changes
5. Allows major decisions to better support established objectives
6. Allows more effective allocation of time and resources
7. Avoids ad hoc decisions

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Mgmt study material created/ compiled by - Commander RK Singh rajeshsingh_r_k@rediffmail.com

8. Helps to integrate the individual behaviours


9. Encourages forward thinking
10. Encourages favourable attitude towards change.

ROLE OF HRM IN STRATEGIC MANAGEMENT

Role in Strategy Formulation: HRM is in a unique position to supply competitive


intelligence that may be useful in strategy formulation. Details regarding advanced
incentive plans used by competitors, opinion survey data from employees, elicit
information about customer complaints, information about pending legislation etc. can be
provided by HRM. Unique HR capabilities serve as a driving force in strategy formulation.

Role in Strategy Implementation: HR Manager helps strategy implementation by


supplying competent people. Additionally, HRM facilitates strategy implementation by
encouraging proactive thinking, communicating goals and improving productivity and
quality.

Page 10 of 74 - Human Resource Management Notes


Jamnalal Bajaj Institute of Mgmt Studies
Mgmt study material created/ compiled by - Commander RK Singh rajeshsingh_r_k@rediffmail.com

HUMAN RESOURCE DEVELOPMENT

Human Resource Development is a process to help people to acquire competencies and to


increase their knowledge, skills and capabilities for better performance and higher
productivity.

Definition 1:

HRD is a process of enhancing the physical, mental and emotional capacities of individuals
for productive work.

Definition 2:

HRD means to bring about the possibility of performance improvement and individual
growth.

PROACTIVE HRD STRATEGIES FOR LONG


TERM PLANNING AND GROWTH

Like quoted earlier, employee retention has become bigger challenge than employee hiring
today. With trade unions breathing their last, and easy job availability, employees have
developed propensity to switch jobs for minor reasons without voicing their protest. Thus,
HRD has to take a proactive approach, that is, to seek preventive care in human relations.
By using HRD strategies, maximization of efficiency and productivity could be achieved
through qualitative growth of people.

Long-term growth can also be planned by creating highly inspired groups of employees
with high aspirations to diversify around core competencies and to build new
organizational responses for coping with change.

A proactive HRD strategy can implement plans directed at improving personal competence
and productive potentials of human resources.

Following strategic choices can be considered which would help today’s organizations to
survive and grow.

Change Management: Manage change properly and become an effective change agent
rather than being a victim of change itself.

Values: Adopt proactive HRD measures, which encourage values of trust, autonomy,
proactive approach and experimentation.

Page 11 of 74 - Human Resource Management Notes


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Mgmt study material created/ compiled by - Commander RK Singh rajeshsingh_r_k@rediffmail.com

Maximize Productivity and Efficiency: Maximize productivity and efficiency of the


organization by helping qualitative growth of people

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Jamnalal Bajaj Institute of Mgmt Studies
Mgmt study material created/ compiled by - Commander RK Singh rajeshsingh_r_k@rediffmail.com

TEAM EFFECTIVENESS

Definition:

A team is a small group of people who agree to work together for achieving a clear and
identifiable set of goals.

Teams Can be Very Effective.

The benefit of teams lie in Synergy which means – The whole is greater than sum of its
parts. Thus, a team is able to produce more than the sum of individuals working separately.
A team benefits from complementing and some times contrasting abilities of its members.
Teams can bring to bear a wider range of skills and experience to solve a problem. Teams
often lead to better quality decisions as individual whims and prejudices are kept in check.
Further, members of team have an obligation to each other and thus there is a moral
force/binding to perform.

TEAM EFFECTIVENESS

For a team to be effective, following are the prerequisites:

1. Harmony and trust among the team members


2. Effective leadership
3. Shared goals
4. Diverse skills and experience - technical, problem solving and interpersonal skills
5. Creativity and risk taking ability
6. Freedom to voice views
7. Ability to self-correct
8. Interdependent work
9. Effective decision making process
10. Ability to resolve conflict
11. Clear communication channels

Synergy among the team members is very important. The team needs a clear sense of
direction which the leader provides. Harmony and trust among the group members is
utmost essential. In any group, conflicts are inevitable, how ever harmonious it may be.
There has to be a well formulated policy for conflict management. Decision making is a

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source of potential conflicts. A well charted course for decision taking will be able to
minimise such conflicts.

HUMAN RESOURCE PLANNING (H R P)

Human Resource Planning is the process of identification/ forecasting a firm’s future


requirement of type and number of people in order to meet the organisational goals and
objectives. It is a continuous process either due to fresh requirement of manpower owing to
change/growth/diversification of business or due to attrition of manpower due to
retirement, termination, death, disability or resignations.

Definition 1:

“HRP includes estimation of how many qualified people are necessary to meet the future
business requirement, how many people will be available, and what, if anything, must be
done to ensure availability of personnel equals the demand at all times in the future.”

Definition 2:

“HRP is a Process, by which an organization ensures that it has the right number of right
kind of people at the right place, at the right time, capable of effectively and efficiently
completing those tasks that will help the organization achieve its overall objectives.”

NEED & IMPORTANCE OF HRP

Human Resource comes at a cost and generates profits. While excess of human resource
will lead to unproductive costs, shortages of same will lead to idling of other resources and
impede profit generation. Having the people is not enough. Each job needs specific skills
and experience and only a certain trained personnel can do it effectively. Therefore, it is
necessary that right kinds of people are hired for each job.

Personnel requirement is never static. Manpower wastages in the organisation keep taking
place regularly due to retirement, injury, resignations, termination, etc. In addition, changes
in the business environment, business model and plan, capacity/product changes,
diversifications, etc, also generate need to review the human resource requirement of the
organisation.

Changes in the Business Environment in the past one and half decade have led to relative
scarcity of talented people. Right kinds of people are no more available at short notice.
There is considerable time gap between identifying the need for manpower and filling the
vacancy, some times stretching between 6 months to one year. Thus, it will help the
company if the requirement is forecasted adequately in advance to enable hiring of right
kind of personnel just in time so that neither the machines/other resource idle for want of
manpower nor do the people idle. At the same time, there could be situations when there is

Page 14 of 74 - Human Resource Management Notes


Jamnalal Bajaj Institute of Mgmt Studies
Mgmt study material created/ compiled by - Commander RK Singh rajeshsingh_r_k@rediffmail.com

spare manpower in the company. Company may have changed over to a new technology
productions and therefore all personnel trained in old machines may have become
redundant and surplus. The “Exit Policy” for workers is not easy and they can not be
released at short notice. Re-training or retrenchment of personnel has to be planned in
advance.

In India services is growing at a fast pace. It has already overtaken agriculture and
Industrial production sectors to become the biggest contributor to GDP. In service industry,
human capital is the most important asset. HRP bears a disproportionate importance in this
industry.

Foundation of Personnel Functions : HRP provides for not only front line
manpower but also caters for support staff requirement which are called Personnel
“Functions” like recruitment, selection, personnel development, training and
development etc. Large scale changes in frontline staff will have proportional
changes in requirement of support staff as well which can be planned alongside.

HRP SYSTEM

HRP System as such includes following elements or sets for planning.


• Business Environment
• Overall Organization Objectives
• Forecasting Manpower Needs
• Assessing Manpower Supply
• Matching Manpower Demand-Supply factors
Based on these elements we can draw “HRP System Architecture” as under.
Business Environment

Organization Objectives & Goals

Manpower Forecast Manpower Supply Assessment

Manpower Programming

Manpower Implementation

Control & Manpower


Evaluation

Surplus Manpower Shortage of Manpower


Page 15 of 74 - Human Resource Management Notes
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Mgmt study material created/ compiled by - Commander RK Singh rajeshsingh_r_k@rediffmail.com

HRP PROCESS

Organizational Objectives & Policies:


Organizational objectives and policies give a clue to future requirement of manpower. A
company planning expansion would require more manpower in near future. Kind of people
required would be dictated by technology being planned for expansion. HRP needs to align
hiring of people with these elements. In addition, company’s policies towards its manpower
policies, like using internal resources for promotion or external resources or dependence on
certain caste or region for some jobs have also to be catered for. Gujarati companies in
diamond business hire only gujaraties. Similarly, certain Business Houses from Rajasthan
prefer Rajasthanies. So, HRP process will be dictated by following organisational policies:

1. Internal Hiring or External Hiring?


2. Training & Development plans
3. Union Constraints
4. Job enrichment issues
5. Rightsizing organization
6. Automation needs
7. Continuous availability of adaptive and flexible workforce

Manpower Demand Forecasting: It is the process of estimating the future quantity and
quality of people required. The basis should be long term corporate plans. Demand
forecasting should be based on following factors.

Internal Factors: -
• Production levels
• New products and services
• Organizational structure
• Employee separation
• Budget constraints

External Factors:
• Economic climate
• Laws and regulatory bodies
• Technology changes
• Social Factors
• Legal requirements with regards to reservations

Page 16 of 74 - Human Resource Management Notes


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Mgmt study material created/ compiled by - Commander RK Singh rajeshsingh_r_k@rediffmail.com

Manpower Supply Forecasting: This process measures the number of people likely to
be available from within and outside the organization after making allowance for
absenteeism, internal movements and promotions, wastages, changes in hours and other
conditions of work.

Supply Analysis covers:

Existing Human Resources: HR Audits facilitate analysis of existing employees


with skills and abilities. The existing employees can be categorized as skills
inventories (non-managers) and managerial inventories (managers).

Skill inventory would include the following;


• Personal data
• Skills
• Special Qualifications
• Salary
• Job History
• Company data
• Capabilities
• Special preferences

Management inventories would include the following:


• Work History
• Strengths
• Weaknesses
• Promotion Potential
• Career Goals
• Personal Data
• Number and Types of Subordinates supervised
• Total Budget Managed
• Previous Management Duties

Internal Supply Assessment:


• Inflows and outflows (transfers, promotions, separations, resignations,
retirements etc.)
• Turnover rate (No. Of separations p.a. / Average employees p.a. X 100)
• Conditions of work (working hours, overtime, etc.)
• Absenteeism (leaves, absences)
• Productivity level
• Job movements (Job rotations or cross functional utilizations)

External Supply Assessment: External sources are required for following reasons
• New blood,
• New experiences

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• Replenish lost personnel


• Organizational growth
• Diversification
External sources can be colleges and universities, consultants, competitors and
unsolicited applications.

SUCCESSION PLANNING

Meaning of Succession Planning

Succession planning is the process or activities connected with the filling of key positions
in the organization hierarchy as vacancies arise. Succession planning focuses on
identification of future vacancies and locating the probable successor. For example in
succession planning the key concern can be who will be next CEO or what will happen if
the Marketing Manager retires in coming March. Grooming a person to fill an important
position may take years. Succession planning involves identification of key positions in the
company and then scouting for people who can effectively fill those positions at short
notice.

Importance of Succession Planning

1. Succession planning helps when there is a sudden need due to job hopping/death of
serious injury to a key employee.
2. There is little or no set back due to absence of key employee.
3. Acts as a motivator for the individual employee who comes to know of the
impending promotion in advance.
4. Succession planning helps create loyalty towards the organization and improved
motivation and morale of individual employees.
5. Organization gains stable workforce and low employee turnover.
6. Ultimately organization becomes successful in accomplishing its goals effectively.

CAREER PLANNING

Career as a concept means a lifelong sequences of professional, educational and


developmental experiences that an individual goes through in his working life. It is a
sequence of positions occupied by a person during his life.

Career planning is the process of identifying an individual’s strengths, weaknesses,


aptitudes, inclinations, aspirations and attitudes and designing his job responsibilities to
take maximum advantages of positive traits and minimising the effect negatives traits.

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After identifying the personality traits of the individual begins the process of identifying
suitable job billets for him. It may also involve training at times to strengthen his weak
areas.

Career planning is a process of integrating the employees’ needs and aspirations with
organizational requirements.

A typical succession planning involves the following activities:

1. Analysis of the demand for managers and professionals by company


level, function and skill.
2. Audit of existing executives and projection of likely future supply from
internal and external sources.
3. Planning of individual career paths based on objective estimates of
future needs and drawing on reliable performance appraisals and assessments of
potential.
4. Career counselling undertaken in the context of a realistic understanding
of the future needs of the firm as well as those of the individual.
5. Accelerated promotions with development targeted against the future
needs of the business.
6. Performance related training and development to prepare individuals for
future roles as well as current responsibilities
7. Planned strategic recruitment not only to fill short term needs but also to
provide people for development to meet future needs
8. The actual activities by which openings are filled

Page 19 of 74 - Human Resource Management Notes


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Mgmt study material created/ compiled by - Commander RK Singh rajeshsingh_r_k@rediffmail.com

JOB ANALYSIS

Definition 1

“Job Analysis is a process of collecting and studying the information relating to operations
and responsibilities of a specific job. The immediate products of this analysis are ‘Job
Description’ and ‘Job Specifications’.”

Definition 2

“It is a basic technical procedure that is used to define duties and responsibilities and
accountabilities of the job.”

PURPOSE OF JOB ANALYSIS: -

• Human Resource Planning (HRP) : Job analysis helps in determining


staffing needs, type, quality and quantity.

• Recruitment & Selection : Knowing the staffing needs is essential for


Recruitment and Selection – Right person for each job. Sourcing of recruits also
becomes easy and cost effective

• Training & Development : Job analysis is the key to determining Training and
Development programs.

• Job Evaluation : Job evaluation means determination of relative worth of each


job for the purpose of establishing wage and salary. This is possible with the help of
job description and specifications; i.e. Job Analysis.

• Remuneration : Job analysis also helps in determining wage and salary for the
jobs.

• Performance Appraisal : Job analysis helps in fixing the bench marks of


performance standards which in turn help in objective Performance appraisal,
rewards, promotions, etc.

• Safety & Health : Job Analysis helps to uncover hazardous conditions and
unhealthy environmental factors so that corrective measures can be taken to
minimize and avoid possibility of human injury.

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JOB DESCRIPTION

“Job Description implies objective listing of the job title, tasks, and responsibilities
involved in a job.”

Job description is a word picture of the duties, responsibilities and organizational


relationships that constitutes a given job or position. It defines work assignment and a
scope of responsibility that are sufficiently different from those of the other jobs to warrant
a specific title. Job description is a broad statement of purpose, scope, duties and
responsibilities of a particular job.

Contents of Job Description

1. Job Identification
2. Job Summary
3. Job Duties and Responsibilities
4. Supervision specification
5. Machines, tools and materials
6. Work conditions
7. Work hazards
8. Definition of unusual terms

Format of Job Description

1. Job Title
2. Region/Location
3. Department
4. Reporting to (Operational and Managerial)
5. Objective
6. Principal duties and responsibilities

Page 21 of 74 - Human Resource Management Notes


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Mgmt study material created/ compiled by - Commander RK Singh rajeshsingh_r_k@rediffmail.com

JOB SPECIFICATIONS

“Job Specification involves listing of qualifications, skills and abilities required in an


employee to meet the job description. These specifications are minimum required to do the
job satisfactorily.”

In other words, it is a statement of minimum acceptable physical/psychological attributes


and professional skills necessary to perform the job properly. Job specifications seek to
indicate kind of persons who can be expected to meet the role requirements. Thus, it is
basically concerned with matters of selection, screening and placement and is intended to
serve as a guide in hiring.

Contents of Job Specifications

1. Physical Characteristics
2. Psychological characteristics
3. Personal characteristics
4. Educational Qualifications
5. Skill Set and Experience/Responsibilities
6. Demographic features

Job specifications can be further divided into three broad categories


1. Essential Attributes
2. Desirable Attributes
3. Contra-Indicators – Attributes which are likely to act as impediments to success of
job

Page 22 of 74 - Human Resource Management Notes


Jamnalal Bajaj Institute of Mgmt Studies
Mgmt study material created/ compiled by - Commander RK Singh rajeshsingh_r_k@rediffmail.com

JOB EVALUATION

Job evaluation is the process of analyzing and assessing various jobs systematically to
ascertain their relative worth in an organization.

Job Evaluation involves determination of relative worth of each job for the purpose of
establishing wage and salary differentials. Relative worth is determined mainly on the basis
of Job Description and Job Specification only. Job Evaluation helps to determine wages
and salary grades for all jobs. Employees need to be compensated depending on the grades
of jobs they perform. Remuneration must be based on the relative worth of each job.
Ignoring this basic principle results in inequitable compensation and attendant ill effects on
employees’ morale. A perception of inequity is a sure way of de-motivating an employee.

Jobs are evaluated on the basis of content and placed in order of importance. This
establishes Job Hierarchies, which becomes the basis for satisfactory wage differentials
among various jobs.

Jobs are ranked (not jobholders)

PROCESS OF JOB EVALUATION:

1. Defining objectives of job evaluation

(a) Identify jobs to be evaluated (Benchmark jobs or all jobs)


(b) Who should evaluate job?
(c) What training do the evaluators need?
(d) How much time involved?
(e) What are the criteria for evaluation?
(f) Methods of evaluation to be used

2. Wage Survey
3. Employee Classification
4. Establishing wage and salary differentials.

METHODS OF JOB EVALUATION

1. Analytical Methods

(a) Point Ranking Methods: Different factors are selected for different jobs with
accompanying differences in degrees and points.

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Mgmt study material created/ compiled by - Commander RK Singh rajeshsingh_r_k@rediffmail.com

(b) Factor Comparison Method: The important factors are selected which
can be assumed to be common to all jobs. Each of these factors are then
ranked with other jobs. The worth of the job is then taken by adding together
all the point values.

2. Non-Analytical Methods

(a) Ranking Method: Jobs are ranked on the basis of their title or contents. Like
Managers, Supervisors, Workers, Peon, etc. All managers whether from
production, planning, sales, stores or Allied Services (House Keeping) Deptt
are treated equal. Job is not broken down into factors etc. It is easier to
implement but not always satisfactory for the employees.

(b) Job Grading Method: It is based on the job as a whole and the differentiation
is made on the basis of job classes and grades. Like in a hotel,
Receptionist’s job may be graded higher than back office billing clerk’s job.
Similarly, a production/sales manager billet may be graded higher than
Allied Services Manager’s. In this method it is important to form a grade
description to cover discernible differences in skills, importance to
company’s core operations, responsibilities and other characteristics.

PITFALLS OF JOB EVALUATION:

1. Sometimes encourages employees to manipulate for promotion/internal placement


when there may be limited opportunities for enhancement as a result of downsizing.

2. It promotes internal focus (office politics) instead of customer orientation

3. Not suitable for forward looking organizations, which may have trimmed multiple job
titles into two or three broad jobs.

Page 24 of 74 - Human Resource Management Notes


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Mgmt study material created/ compiled by - Commander RK Singh rajeshsingh_r_k@rediffmail.com

JOB DESIGN

In the most simplified form - The process of breaking/organizing work into specific tasks
in order to perform a specific job is called Job Design. Job Design is the logical Sequence
to Job Analysis. Job design involves conscious efforts to organise tasks, duties and
responsibilities into a unit of work to achieve certain objective.

Steps in Job Design


1. Specification of Individual Tasks
2. Specification of Methods for Tasks Performance
3. Combination of Tasks into Specific Jobs to be assigned to individuals

FACTORS AFFECTING JOB DESIGN

1. Organizational factors
(a) Characteristics of Tasks (Planning, Execution and Controlling of Task)
(b) Work Flow (Process Sequences)
(c) Ergonomics (Time & Motion Study)
(d) Work Practices (Set of ways of performing tasks)

2. Environmental Factors
(a) Employee Abilities and Availability
(b) Social and Cultural Expectations

3. Behavioural Elements
(a) Feedback
(b) Autonomy
(c) Use of Abilities
(d) Variety

TECHNIQUES OF JOB DESIGN

1. Work Simplification : Job is simplified or specialized. The job is broken down


into small parts and each part is assigned to an individual. To be more specific, work
simplification is breaking down the job to such small tasks that complexity is taken out of
them. Like in a assembly line of car, one person only tighten wheel nuts with a pneumatic
tool which tighten the nuts. The complexity of ensuring that each nut is tightened to
required degree has been transferred to machine and the worker only applies the tool to the

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Mgmt study material created/ compiled by - Commander RK Singh rajeshsingh_r_k@rediffmail.com

right place. He does not even put the wheel in place. In such cases, work becomes
repetitive in nature. Work simplification is used when jobs are not specialized.

2. Job Rotation : Same job, same people, same surrounding, days over days,
months over months, leads to boredom and even fatigue. And it manifests in higher error
rate, fall in productivity, absenteeism, job hopping, etc. Job rotation is answer to such
problems. While broadly the job may remain same, minor variations between jobs are
enough to rejuvenate the employee. It not only benefits the personnel but also the
organisation in equal measure

(a) Benefit to the Employee. It is a development tool since the employees get
exposure to several jobs which develops their personality and employability.
It improves their self-image and leads to personal growth. Such cross
functional deployments often reveal hidden performance potentials/skills of
many employees in the course of new job.

(b) Benefits to the Company: Such cross functional knowledge of employees


provides the company with a fall back option in case of absence of any
employee. It also gives flexibility to the management to reorganise the
functional setup just in case of need like demand pattern shift or change in
business model or any other eventuality. Also, periodic job rotation is the
best method to avoid compartmentalisation of departments. Movement of
personnel between departments and first hand knowledge of limitations and
problems faced by other departments reduces frictions and leads to better
cooperation between them. Interpersonal bonds developed during in the
course of such cross functional job rotation further smoothens the
interaction between departments. On the negative side, training costs rise
and it can also de-motivate intelligent and ambitious trainees who might
take it as their undesirability in their own department unless it is well laid
down policy of the company.

3. Job Enlargement : It means expanding the number of tasks, or duties assigned


to a given job. Job enlargement is naturally opposite to work simplification. Adding more
tasks or duties to a job does not necessarily mean that new skills and abilities are needed.
There is only horizontal expansion. It is with same skills taking additional responsibilities
like increasing the number of machines operators under a supervisor from 10 to 15. Job
enlargement may involve breaking up of the existing work system and redesigning a new
work system. For this employees also need to be trained to adjust to the new system. Job
enlargement is said to contribute to employee motivation but the claim is not validated in
practice.

4. Job Enrichment : Job enrichment is to add a few more motivators to a job to


make it more rewarding. A job is enriched when the nature of the job is exciting,
challenging, rewarding and creative or gives the job holder more decision-making,
planning and controlling powers. An enriched job will have more authority, responsibility,
autonomy (vertical enrichment), more variety of tasks (horizontal enrichment) and more
growth opportunities. The employee does more planning and controlling with less

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Mgmt study material created/ compiled by - Commander RK Singh rajeshsingh_r_k@rediffmail.com

supervision but more self-evaluation. For example: transferring some of the supervisor’s
tasks to the employee and making his job enriched. As per Hertzberg, who was the father
of this term, an enriched job has eight characteristics:

(a) Direct Feedback: Employee should be able to get immediate knowledge of the
results they are achieving.
(b) Client Relationship: An employee who serves a client or customer
directly has an enriched job. The client can be outside or inside the firm.
(c) New Learning: An enriched job allows its incumbent to feel that he is growing
intellectually.
(d) Scheduling Own Work: Freedom to schedule own work (autonomy) is job
enrichment.
(e) Unique Experience: A enriched job has some unique qualities or features.
(f) Control over Resources: One approach to Job enrichment is for the each
employee to have control over his or her resources and expenses.
(g) Direct Communication Authority: An enriched job allows worker to
communicate directly with people who use his or her output.
(h) Personal Accountability: An enriched job holds the incumbent responsible for
the results. He or she receives praise for good work and blame for poor
work.
Problems with Job Enrichment
(a) Job enrichment is not a substitute for good governance. If other environmental
factors in the business are not right, mere job enrichment will not mean
much.
(b) Job enrichment may have short term negative effects till the worker gets used
to the new responsibility.
(c) Job enrichment itself might not be a great motivator since it is job-intrinsic
factor. As per the two-factor motivation theory, job enrichment is not
enough. It should be preceded by hygienic factors etc.
(d) Job enrichment assumes that workers want more responsibilities and those
workers who are motivated by less responsibility, job enrichment surely de-
motivates them
(e) Workers participation may affect the enrichment process itself.
(f) Change is difficult to implement and is always resisted as job enrichment brings
in a changes the responsibility.

5. Autonomous o r Self-Directed Teams : Empowerment results in self-


directed work teams. A self-directed team is a group of employees responsible for a whole
work segment. They work together, handle day-to-day problems, plan and control, and are
highly effective team.

Page 27 of 74 - Human Resource Management Notes


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Mgmt study material created/ compiled by - Commander RK Singh rajeshsingh_r_k@rediffmail.com

JOB SATISFACTION

Job satisfaction is self satisfaction derived by an employee in doing the job he has been
entrusted to do. Job satisfaction is more a function of the various attitudes possessed by an
employee towards his job, related factors and life in general than the job itself. The
attitudes related to job may be wages, supervision, steadiness, working conditions,
advancement opportunities, recognitions, fair evaluation of work, social relations on job,
prompt settlement of grievances etc. A person with a kind heart will find high level of job
satisfaction in working with some agency involved in charitable work though the salary
might be relatively less. An over ambitious person will never find the job satisfaction.

In short job satisfaction is a general attitude towards the job, which is the result of many
specific attitudes in three areas namely, job factors, individual characteristics and group
relationships outside the job.

COMPONENTS OF JOB SATISFACTION

Personal factors: Sex, Dependents, Age, Timings, Intelligence, Natural affinity towards
the job, Education and Personality.

Job Inherent Factors: Nature of work, Skills, Occupational status, Geography, etc.

Management Controlled Factors: Security, Payment, Fringe benefits, Advancement


opportunities and Working conditions, Co-workers, Responsibilities, Supervision

WORK SAMPLING
Definition:

"A measurement technique for the quantitative analysis of a random/irregularly occurring


activity."

MEANING OF WORK SAMPLING

Work sampling is based on the theory that the characteristics of a sufficiently large sample
represent the actual characteristics of entire population. Work sampling operates by an
observer taking a series of random observations on a particular "item" of interest (machine,
operating room, dock, etc.) to observe its "state" (working, idle, sleeping, empty, etc.).

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Mgmt study material created/ compiled by - Commander RK Singh rajeshsingh_r_k@rediffmail.com

When enough samples are taken, an analysis of the observations yields a statistically valid
indication of the states for each thing analyzed.

Assume, for example, that you wish to determine the proportion of time a factory operator
is working or idle. Also assume that 200 random observations were made of the operator
and during 24 of these he or she was observed to be idle. From the random samples of his
state you conclude that the individual is working 176/200 = 88% of the time.

ADVANTAGES OF WORK SAMPLING

It is relatively easy, simple and inexpensive to use and extremely helpful in providing a
deeper understanding of all types of operations.

When properly used, it can help pinpoint those areas, which should be analyzed in further
detail and can serve as a measure of the progress being made in improving operations.

QUESTIONS OF WORK SAMPLING STUDY

• What is our equipment/asset utilization?


• When we are not adding value to the product, how are we spending our time?
• How are our inter-dependent systems performing?
• Where should we focus our continuous improvement activities?

DISTINCTION BETWEEN WORK SAMPLING AND


"TIME STUDIES"

Before we set out to analyse the distinctions between work sampling and time studies, let
us understand that the two are as different as chalk and cheese. The purpose of each is
different and one can not be substituted by the other in most cases. While work sampling is
a broad analysis of trend, time study is microanalysis of the job and procedure. Time study
is conducted with a view to improve the process/method where as work sampling is done to
improve quantitative utilisation of resources.

• Work sampling is relatively cheaper because it uses random samples instead of


continuous observations.
• Many operators or machines can be studied by a single observer
• Work sampling normally spans over several days or weeks, thus minimizing the effects
of sudden variations on a particular day.
• Work Sampling tends to minimize operator behaviour modification during observation
(operator, deliberately or otherwise, under or over performing while under observation).

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Mgmt study material created/ compiled by - Commander RK Singh rajeshsingh_r_k@rediffmail.com

• Work Sampling, in general, does not require a trained time-study analyst to take the
observations. Also, stopwatches or other timing devices are not required. Many studies
make use of off-shift technicians or operators to take the observations.

WORK SAMPLING METHODOLOGY

An analyst RANDOMLY observes an activity (equipment, operating room, production


line) and notes the particular states of the activity at each observation.

The ratio of the number of observations of a given state of the activity to the total number
of observations taken will approximate the percentage of time that the activity is in that
given state.

Randomness of observations is very critical for a work sampling study. The observations
should vary over the time of the day, days of the week and if possible, months to get he
correct trend.

Page 30 of 74 - Human Resource Management Notes


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Mgmt study material created/ compiled by - Commander RK Singh rajeshsingh_r_k@rediffmail.com

RECRUITMENT

Definition:

“Recruitment is the process of finding and attracting capable applicants for a job to create a
pool from which selection is to be made of the most suitable candidates”.

The Process begins when new recruits are sought and ends when their applications are
submitted. Though theoretically recruitment process is said to end with the receipt of
applications, in practice, the activity extends to the screening of applications so as to
eliminate those who are not qualified for the job. The result is a pool of applicants from
which selections for new employees are made.”

PURPOSE AND IMPORTANCE

1. To broad base the applicant pool in order to get the right talent at the affordable
cost.
2. Increase the pool of job candidates at minimum cost
3. Help increase success rate of selection process by reducing number of under-
qualified or over-qualified applications.
4. Meet legal and social obligation.
5. Identify and prepare potential job applicants

FACTORS AFFECTING RECRUITMENT


External Factors:
1. Demand and Supply status of specific skills set.
2. Unemployment Rate (Area-wise)
3. Labour Market Conditions
4. Political and Legal Environment (Reservations, Labour laws)
5. Company’s Image

Internal Factors:
1. Recruitment Policy (Internal Hiring or External Hiring?)
2. Human Resource Planning (Planning of resources required)

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3. Size of the Organization (Bigger the size lesser the recruitment problems)
4. Cost
5. Growth and Expansion Plans

RECRUITMENT PROCESS

1. Recruitment Strategy Development


(a) Trained or untrained (to be trained at company’s expense)
(b) Internal or external sourcing

Internal Recruitment (Source 1)

(i) Present employees


(ii) Employee referrals
(iii) Transfers & Promotions
(iv) Former Employees
(v) Previous Applicants

External Recruitment (Source 2)

(i) Professionals or Trade Associations


(ii) Advertisements
(iii) Employment Exchanges
(iv) Campus Recruitment
(v) Walk-ins Interviews
(vi) Consultants
(vii) Contractors
(viii) Displaced Persons
(ix) Radio & Television
(x) Acquisitions & Mergers
(c) Competitors
(d) Technological tools to be used for advertising
(e) Where to look
(f) How to look

2. Recruitment Planning

(a) Number of applicants sought (Based on past experience)

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(b) Types of applicants to be called (Qualification, category, area, etc)

3. Searching

(a) Source activation


(b) Selling

4. Screening of Applications

5. Evaluation and Cost Control


(a) Salary Cost
(b) Management & Professional Time spent
(c) Advertisement Cost
(d) Producing Supporting literature
(e) Recruitment Overheads and Expenses
(f) Cost of Overtime and Outsourcing
(g) Consultant’s fees

EVALUATION OF RECRUITMENT PROCESS

1. Return rate of each source of recruitment


2. Selection rate from each source
3. Retention and Performance of selected candidates
4. Recruitment Cost
5. Time lapsed data
6. Image projection

INTERNAL RECRUITMENT
Advantages Disadvantages
1. Less Costly 1. Old concept of doing things
2. Candidates already oriented towards 2. It abets raiding
organization 3. Candidates current work may be
3. Organizations have better knowledge affected
about internal candidates 4. Politics play greater roles
4. Employee morale and motivation is 5. Morale problem for those not
enhanced promoted.

Page 33 of 74 - Human Resource Management Notes


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Mgmt study material created/ compiled by - Commander RK Singh rajeshsingh_r_k@rediffmail.com

EXTERNAL RECRUITMENT
Advantages Disadvantages
1. Benefits of new skills, talents and Ideas 1. Better morale and motivation
2. Benefits of new experiences associated with internal recruiting is
3. Compliance with reservation policy denied
becomes easy 2. It is costly method
4. Scope for resentment, jealousies, and 3. Chances of creeping in false positive
heartburn are avoided. and false negative errors
4. Adjustment of new employees takes
longer time.

Page 34 of 74 - Human Resource Management Notes


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Mgmt study material created/ compiled by - Commander RK Singh rajeshsingh_r_k@rediffmail.com

SELECTION

MEANING OF SELECTION

Selection is the process of picking up individuals (out of the pool of job applicants) with
requisite qualifications and competence to fill jobs in the organization. A formal definition
of Selection is as under:

“Selection is the process of differentiating between applicants in order to identify and hire
those with a greater likelihood of success in a job.”

RECRUITMENT Vs SELECTION: DIFFERENCE

Recruitment Selection
1. Recruitment refers to the process of 1. Selection is concerned with picking up
identifying and encouraging people the right candidates from a pool of
with required qualifications to apply for applicants.
job. 2. Selection on the other hand is negative
2. Recruitment is said to be positive in its in its application in as much as it seeks
approach as it seeks to attract as many to eliminate as many unqualified
candidates as possible. applicants as possible in order to
identify the right candidates.

PROCESS / STEPS IN SELECTION

1. Preliminary Interview : This is a short interview. The purpose of preliminary


interviews is to weed out the prima facie misfit applicants. It is also called courtesy
interview and is a good public relations exercise.

2. Selection Tests : Jobseekers who pass the preliminary interviews are called for
tests. There are various types of tests conducted depending upon nature of job and
the company. These tests can be Aptitude Tests, Personality Tests and Ability Tests
and are conducted to judge how well an individual can perform tasks related to the
job. Besides this, there are some other tests also like Interest Tests (activity
preferences), Graphology Test (Handwriting), Medical Tests, Psychometric Tests
etc.

3. Employment Interview : The next step in selection is employment interview. Here,


interview is a formal and in-depth conversation to assess applicant’s suitability. It is
considered to be an excellent selection device. Interview type and pattern can vary

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Mgmt study material created/ compiled by - Commander RK Singh rajeshsingh_r_k@rediffmail.com

greatly. Interviews can be One-to-One, Panel Interview, or Sequential Interviews.


Besides there can be Structured and Unstructured interviews, Behavioural
Interviews, Stress Interviews.

4. Reference & Background Checks : Reference checks and background checks


are conducted for provisionally identified candidates to verify the information
provided by them. Reference checks can be through formal letters or telephonic.
However, it is more of a formality and selections decisions are very seldom affected
by it.

5. Selection Decision : After obtaining all the information, selection decision is


made. The final decision has to be made out of applicants who have been identified
as suitable. The views of line managers carry much weight at this stage because it is
they who are eventually responsible for the performance of the new employee.
Considering the job climate, often more than required number is selected to cater
for any selected candidate withdrawing at the job offer stage.

6. Physical Examination : After the selection decision is made, the candidate is


required to undergo a physical fitness test. A job offer is often contingent upon the
candidate passing the physical examination.

7. Job Offer : The next step in selection process is job offer to those applicants who
have successfully passed all tests. It is made by way of letter of appointment.

8. Contract of Employment : After the job offer is made and candidates accept the
offer, certain documents are needed to be executed by the employer and the
candidate. A formal contract of employment, containing written contractual terms
of employment etc are signed by both sides.

GOOD SELECTION PRACTICE: ESSENTIALS

1. Detailed Job Descriptions and Job Specifications prepared in advance and endorsed by
personnel and line management should be available with Selection Board.
2. Train the selectors to assess the right attributes in applicants.
3. Determine aids to be used for selection process.
4. Check competence of recruitment consultants before hiring their services.
5. Involve line managers at all stages
6. Attempt to validate the procedure regularly
7. Help the appointed candidate to succeed by training and management development

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Mgmt study material created/ compiled by - Commander RK Singh rajeshsingh_r_k@rediffmail.com

BARRIERS TO EFFECTIVE SELECTION

1. Perception : We all perceive the world differently. Our limited perceptual ability is
obviously a stumbling block to the objective and rational assessment of people.
2. Fairness : Barriers of fairness includes discrimination against religion, region, caste,
race or gender, etc.
3. Plethora of Human Traits : Success in any job is more a function of attitude than
aptitude. The tests are validated over a period of time to differentiate between the
employees who can perform well and those who will not. Yet, no test can claim
100% success in finding the right employee.
4. Pressure : Pressure brought on selectors by management, politicians, bureaucrats,
relatives, friends and peers to select particular candidate are also barriers to
effective selection.
5. Time and Cost : Often the time and funds available to undertake selection process
are limited forcing the selectors to forego certain tests.

Page 37 of 74 - Human Resource Management Notes


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Mgmt study material created/ compiled by - Commander RK Singh rajeshsingh_r_k@rediffmail.com

TRAINING & DEVELOPMENT

Training and development, though are spoken in the same breadth, are quite different.
Training generally refers to teaching of new skill in professional field of the employee.
Like an employee being taught to operate another machine, or to perform a new operation
in the same machine. Development refers to enhancement of personal qualities of the
employee which do not have a one to one relationship with his current job. It may be to
help an employee to grow. Like stress management techniques, yoga lessons, meditation
exercises, soft skills training, etc. While training is expected to reward the company
immediately in terms of better productivity of employee, Development does not lead to any
immediate and tangible benefits to the company. At the best, there might be some
intangible benefits in the long run, like improved motivation, loyalty, improved intra-
departmental relations, reduced absenteeism on medical ground, etc.

Dividing line between training and development is expectation of immediate benefits.


Thus, in case a program, generally qualifying as development program, is directly related
to employee’s job skills, like Communication Skills course for telephone attendant or
receptionist, will qualify as training and not as development. Same program for some one
in back office would be termed as Development program.

Education: It is a theoretical learning in classrooms. The purpose of education is to teach


theoretical concepts and develop a sense of reasoning and judgment. Any training and
development program must contain an element of education.

Definition of Training & Development

“Training & Development is any attempt to improve current or future employee


performance by improving his performance capabilities and potential through learning,
usually by changing the employee’s attitude or increasing his or her skills and knowledge.”

The need for Training and Development is determined by the employee’s performance
deficiency, computed as follows.

Training & Development Need = Standard Performance – Actual Performance

OBJECTIVES OF MANAGEMENT DEVELOPMENT


PROGRAMS (MDP)

1. To make the managers


• Self-starters
• Committed

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• Motivated
• Result oriented
• Sensitive to environment
• Understand use of power
2. Creating self awareness
3. Develop inspiring leadership styles
4. Instil zest for excellence
5. Teach them about effective communication
6. To subordinate their functional loyalties to the interests of the organization

TRAINING AND DEVELOPMENT: DIFFERENCE

Training Development
Training is skills focused Development is creating learning abilities
Training is presumed to have a formal Development is not education dependent
education
Training needs depend upon lack or Development depends on personal drive
deficiency in skills and ambition
Trainings are generally need based Development is voluntary
Training is a narrower concept focused on Development is a broader concept focused
job related skills on personality development
Training may not include development Development includes training wherever
necessary
Training is aimed at improving job related Development aims at overall personal
efficiency and performance effectiveness (including job efficiencies)

IMPORTANCE OF TRAINING & DEVELOPMENT

1. Helps remove performance deficiencies in employees


2. Greater stability, flexibility and capacity for growth in an organization
3. Accidents, scraps and damages to machinery can be avoided
4. Serves as effective source of recruitment
5. It is an investment in HR with a promise of better returns in future
6. Reduces dissatisfaction, absenteeism, complaints and turnover of employees

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IDENTIFICATION OF TRAINING NEEDS

Individual Training Needs Identification


1. Performance Appraisals
2. Interviews
3. Questionnaires
4. Attitude Surveys
5. Training Progress Feedback
6. Work Sampling
7. Rating Scales

Group Level Training Needs Identification


1. Organizational Goals and Objectives
2. Personnel / Skills Inventories
3. Organizational Climate Indices
4. Efficiency Indices
5. Exit Interviews
6. MBO / Work Planning Systems
7. Quality Circles
8. Customer Satisfaction Survey
9. Analysis of Current and Anticipated Changes

Benefits of Training Needs Identification


1. Trainers can be informed about the broader needs in advance
2. Trainers Perception Gaps can be reduced between employees and their supervisors
3. Trainers can design course inputs closer to the specific needs of the participants
4. Diagnosis of causes of performance deficiencies can be done

METHODS OF TRAINING

On the Job Trainings (OJT): When an employee learns the job in actual working site in
real life situation, and not simulated environment, it is called OJT. Employee learns while
working. Take the instance of roadside mechanics. Small boys working there as helpers
learn while helping the head mechanic. They do not learn the defect analysis and engine
repairing skills in any classroom on engine models.

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Advantages of On-the-Job Training:


1. It is directly in the context of job
2. It is often informal
3. It is most effective because it is learning by experience
4. It is least expensive
5. Trainees are highly motivated
6. It is free from artificial classroom situations

Disadvantages of On-the-Job Training:


1. Trainer may not be experienced enough to train or he may not be so inclined.
2. It is not systematically organized
3. Poorly conducted programs may create safety hazards

“On the Job Training” Methods

1. Job Rotation: Refer page 27.


2. Job Coaching: An experienced employee can give a verbal presentation
to explain the nitty-gritty’s of the job.
3. Job Instruction: It may consist of an instruction or directions to perform a
particular task or a function. It may be in the form of orders or steps to
perform a task.
4. Apprenticeships: Generally fresh graduates are put under the experienced
employee to learn the functions of job.
5. Internships and Assistantships: Interns or assistants are recruited to
perform specific time-bound jobs or projects during their education.

Off the Job Training: Trainings conducted in simulated environments, classrooms,


seminars, etc are called Off the Job Training.

Advantages of Off-the-Job Training


1. Trainers are usually experienced enough to train
2. It is systematically organized
3. Efficiently created programs may add lot of value

Disadvantages of Off-the-Job Training:


1. It is not directly in the context of job
2. It is often formal

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3. It may not be based on experience.


4. It is expensive.
5. Trainees may not be much motivated
6. It is artificial in nature

“Off the Job Training” Methods


1. Classroom Lectures: Advantage – It can be used for large groups. Cost per
trainee is low. Disadvantages – Low interest of employees . It is not learning
by practice. It is One-way communication. No authentic feedback
mechanism. Likely to lead to boredom for employees.
2. Audio-Visual: It can be done using Films, Televisions, Video, and
Presentations etc. Advantages – Wide range of realistic examples, quality
control possible. Disadvantages – One-way communication, No feedback
mechanism. No flexibility for different audience.
3. Simulation: Creating a real life situation for decision-making and
understanding the actual job conditions give it. Ensures active participation
of all trainees. Can be very effective but needs good conductors.
4. Case Studies: It is a written description of an actual situation in the past in
same organisation or some where else and trainees are supposed to analyze
and give their conclusions in writing. This is another excellent method to
ensure full and whole hearted participation of employees and generates good
interest among them. Case is later discussed by instructor with all the pros
and cons of each option. It is an ideal method to promote decision-making
abilities within the constraints of limited data.
5. Role Plays: Here trainees assume the part of the specific personalities in a
case study and enact it in front of the audience. It is more emotional
orientation and improves interpersonal relationships. Attitudinal change is
another result. These are generally used in MDP.
6. Sensitivity Trainings: This is more from the point of view of behavioural
assessment as to how an individual will conduct himself and behave towards
others under different circumstances. There is no pre-planned agenda and it
is instant. Advantages – increased ability to empathize, listening skills,
openness, tolerance, and conflict resolution skills. Disadvantage –
Participants may resort to their old habits after the training.
7. Programmed Instructions: Provided in the form of blocks either in book or a
teaching machine using questions and feedbacks without the intervention of
trainer. Advantages – Self paced, trainees can progress at their own speed,
strong motivation for repeat learning, material is structured and self-
contained. Disadvantages – Scope for learning is less; cost of books,
manuals or machinery is expensive.

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8. Computer Aided Instructions: It is extension of PI method, by using


computers. Advantages – Provides accountabilities, modifiable to
technological innovations, flexible to time. Disadvantages – High cost.
9. Laboratory Training.

BARRIERS TO EFFECTIVE TRAINING

1. Lack of Management commitment


2. Inadequate Training budget
3. Large scale poaching of trained staff
4. Non-cooperation from workers
5. Unions influence

HOW TO MAKE TRAINING EFFECTIVE

1. Management Commitment
2. Integration of Training with Business Strategies
3. Comprehensive and Systematic Approach
4. Continuous and Ongoing approach
5. Promoting learning as fundamental value
6. Creations of effective training evaluation system

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INDUCTION & ORIENATION

Induction and Orientation are the procedure that a new employee has to go through in the
organisation. Every employee starting from the lower most, say, from peon to CEO, need
orientation course when they join the organisation. A new employee carries with him a lot
of apprehension about place, job, colleagues, organisational culture, and so on. On the day
of reporting, he needs to know his office/work place, routine, amenities, functional and
reporting channels, etc.

Definition

“It is a Planned Introduction of employees to their jobs, their co-workers and the
organization.”

Difference Between Induction and Orientation

Induction refers to formal training programs that an employee has to complete before he is
put on job. Like in Military, before a new recruit is sent to border, he is trained for a few
months in Drill/Parade, physical fitness, weapon handling, etc. This is called Induction.

Orientation is the information given to the new employees to make him aware of the
comfort issues - where the facilities are, what time lunch is, who are the people he would
be working with and so forth.
Orientation conveys following information:
1. Organisation’s geography/layout
2. Organisational set up (Structure)
3. Daily Work Routine
4. Organization Profile, History, Objectives, Products and Services, etc
5. Introduction to colleagues/immediate superiors and subordinates.
6. Importance of Jobs to the organization
7. Detailed Orientation Presentation covering policies, work rules and employee benefits.

PURPOSE OF ORIENTATION

The idea of Orientation programme is to make the new employees feel “at home” in new
environment. Any employee while joining a new organisation is anxious about the new set-
up, new colleagues, his own performance vis a vis other more experienced employees in
the organisation, his work place, his exact responsibilities, etc. A structured information

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and introduction system will make his transitory period short and reduce his anxiety
quickly. He will begin to perform to his potential quickly.

TYPES OF ORIENTATION PROGRAMS

1. Formal or Informal: In informal orientation, new employees are put on the jobs and
they are expected to acclimatise themselves with the work and the organisation. In
contrast, in formal orientation, an employee goes through a structured introduction
programme.
2. Individual or Collective: Another choice is to be made whether new employees are
to be inducted in group or individually.
3. Serial or Disjunctive: Orientation becomes serial when the person relinquishing the
post hands over the position to the new incumbent. It becomes disjunctive when the
new employee occupies a vacant position with no one to hand him over the
position. He learns the prevalent practices and history slowly from his subordinates
and superiors on gradual basis.
4. Investiture or Divestiture: This is the final strategic choice which relates to decision
regarding allowing the new employees to affect the organisation with his
identity/ideas/functional methods or asking him to modify his identity to merge
with existing culture of the organisation. This is more applicable to high positions
who may have been hired with a view to bring in their experiences and methods of
management to the organisation.

How long should the induction process take?

It starts when the job ad is written, continues through the selection process and is not
complete until the new team member is comfortable as a full contributor to the
organization's goals.

The first hour on day one is a critical component - signing on, issuing keys and passwords,
explaining no go zones, emergency procedures, meeting the people that you will interact
with all have to be done immediately. Until they are done the newcomer is on the payroll,
but is not employed.

After that it is a matter of just in time training - expanding the content as new duties are
undertaken.

We only employ new people one at a time - how can we induct them?

There are some issues, which cannot wait - they vary according to your situation. Perhaps a
buddy system on the job may be the best way to deal with such situations. (This is a
system being followed by many US universities receiving lot of foreign students. A local
student is given a foreign student as buddy to help in all matters in the initial days.) Other

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subjects may be incorporated with refresher training for current staff, or handled as
participant in an outside program. Perhaps some can wait until there are groups of people
who have started in the last few months.

This may take some creative thinking, but the answer is quite simple - until the new people
are integrated, they are less useful. The mathematics of Induction and orientation is often
amazingly simple - not investing time and money to train costs more than training would.

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MULTI SKILLING
Definition

Multi-Skilling- the ability of an employee to perform more than one function or the cross-
training of an employee in several disciplines or tasks.

Multi-Skilling is training of an employee to be able to do more than one job with equal
dexterity.

Multi-Skilling is immensely beneficial to any organisation. Apart from flexibility to


redeploy man power as per changing needs, it also keeps the labour costs low. Many
complex jobs require different skills to accomplish though involvement of each skill may
be for very short duration. Thus, in absence of multi-skilled workers, the team becomes
very large and there is inadequate utilisation of team members. But, if the team members
are multi-skilled, team size can be kept small and thus the labour cost in minimised. In
addition, often job is accomplished much faster with better quality as no time is lost in
explaining the job requirements by one team member to another with attendant risks of
misunderstanding and rework. Bank tellers are examples of multi-skilling. Result is much
faster service.

Imagine the state of extension counters of banks at school or college premises which are
operated by just one or two employees. Those one or two people perform all the functions
which take up to 7 -8 people in bigger branches. Opening the bank, opening new account,
attending queries, accepting deposits and dispensing cash, verification of signatures,
maintaining account books and many other tasks are done by them. If such multi-skilling
was not available with the banks, such branches would have become unviable. Even in the
larger branches,

Advantages of Multi-Skilling (Tangible Benefits)

1. Work force is more flexible.


2. Smaller team size for complex tasks requiring multiple skills.
3. Faster job
4. Labour cost economy
5. Employees can assume other tasks when there is absenteeism.
6. Employees can be moved into other positions in case of overload of any department.

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Advantages of Multi-Skilling (Intangible Benefits)

1. Employees become more aware of the workflow.


2. Employees are better prepared to anticipate problems or requirements of other areas.
3. A new employee at a job may have new ideas to fine-tune that job.
4. Employees overcome feelings of having a dead-end job.
5. Jobs remain interesting and challenging.
6. Tedious tasks can be spread around, decreasing turnover.
7. Boredom in the workplace is reduced.
8. Cohesiveness is enhanced.

Disadvantages of Multi-Skilling

1. Possible reduction in productivity during the training period/longer training period.


2. Increased supervisory time is required until the employee is up to speed.
3. Competence assessments may be more detailed than in traditional systems.
4. Chances of partial skilling in various jobs instead of fully skilled in any one.

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CHANGE MANAGEMENT

Change Management is a Critical HR Professional Skill

Definitions:

1. The adoption of a new idea or behaviour by an organization.

2. Alterations in People, Structure and Technology

Change has become inevitable due to: -


(a) Technology
(b) Competition
(c) Growing customer needs
(d) Environment
(e) Politics
HR’s role in the change process is to help forecast future changes, develop systems and
policies for managing human capital before, during & after the change.

Change can be classified as follows: -

Structural Changes Technological Changes People Changes


Authority Processes Attitudes
Coordination Methods Expectations
Centralization Equipments Behaviours

EXTERNAL FORCES OF CHANGE

1. Marketplace
2. Labour markets
3. Economic Changes
4. Technology
5. Laws and Regulations

INTERNAL FORCES OF CHANGE

1. Corporate Strategies

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2. Workplace
3. Technology and Equipments
4. Employee Attitudes

C H A N G E A G E N T S ( WHO CAN BRING ABOUT CHANGE?)

1. Managers
2. External Consultants
3. Staff Specialists

PROCESS OF CHANGE

Lewin’s Three-Step Procedure of Change


1. Unfreeze present level of behaviour
2. Movement from present to new
3. Refreezing process

Kotter’s Change Management Model


1. Unfreeze
2. Establish Sense of Urgency
3. Form Powerful Guiding Coalition
4. Create the Vision
5. Communicate the Vision

RESISTANCE/BARRIERS TO CHANGE

1. Fear of uncertainty or unknown


2. Fear of economic loss
3. Social pressures/peer pressure
4. Perceived inconveniences
5. Fear of loss of power
6. Need for new styles/skills/knowledge
7. Resistance from groups
8. Organisational culture

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9. Feeling of insecurity
10. Lack of incentives

MANAGING CHANGE

It involves:
1. Strategic planning and alignment
2. Minimising resistance
3. Maximising acceptance
4. External environment assessment
5. Change of Organisational structure and culture
6. Developing work climate to enhance teamwork, trust and co-operation
7. Whole hearted implementation.

TECHNIQUES OF REDUCING RESISTANCE

1. Education through communication


2. Participation of affected people from beginning rather than at the end. Making the
potential hardliners a member of the committee designing the change.
3. Facilitation through support to people to overcome the blues of change
4. Negotiation – Give and take attitude
5. Manipulation – co-option
6. Explicit or implicit coercion
Mixed strategies are used to overcome change

FOUR PHASES OF TRANSITION- OLD TO NEW

1. Denial –
Diagnosis: Common to observe withdrawal; focusing on the past;
increased activity with reduced productivity.
Management: Confront with information; reinforce reality of change;
explain what they can do; give them time.

2. Resistance –

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Diagnosis: Anger, blame, depression, resentment, continued lack of


productivity.
Management: Listen, acknowledge feelings, be empathetic; help people to
say good by to the old; sometimes ritual is important. Offer
rewards for change, be optimistic.
3. Exploration –
Diagnosis: Confusion, chaos; energy; new ideas; lack of focus.
Management: Facilitate brainstorming, planning, help people to see
opportunity, create focus through short term wins.

4. Commitment –
Diagnosis: Enthusiasm & cooperation; people identify with
organization; look for new challenges.
Management: Set long term goals; reward those who have changed.

ORGANIZATIONAL DEVELOPMENT
TECHNIQUES

Survey Feedback
Sensitivity Training
Process Consultation
Team Building
Inter-group Development

Conditions Facilitating Change


Dramatic Crisis
Leadership Change
Weak Culture
Young and Small Organization (ageing)

The Road to Change in Culture


Analyze the culture
Need for change
New leadership
Reorganize
Restructure
New stories and rituals
Change the job systems

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TQM V/S. REENGINEERING

TQM (Total Quality Management) Re engineering


Continuous Change Radical and One time Change
Fixing and Improving Redesigning
Mostly focused on ‘As-Is’ Mostly focused on ‘what can be?’
Systems indispensable Top to Bottom
Bottom to Top

Managing Downsized Workforce


Open and honest communication
Assistance to them
Help for survivors of the downsized

Stress in Workplace
Opportunities stress
Demands stress
Constraints stress

HOW TO REDUCE WORKPLACE STRESS

Biggest source of stress is Uncertainty. Quite often worst of the result is less painful than
the anxiety waiting for it. If you can reduce uncertainty, stress will automatically reduce.
However, reducing uncertainty is not always possible. Some of these methods can be
employed to reduce work place stress: -
1. Organizational communication: Clear and prompt communication of policies and
decisions can help in keeping the stress within manageable limits.
2. Performance Assessment is another source of anxiety. Clear predefined
performance parameters will take the uncertainty out of assessment and also
anxiety.
3. Job Redesign, especially when processes change, jobs merging, and relocation
happens
4. Employee Counselling
5. Time management programs for employees: In the busy life of today, time
management is another source of stress for a lot of employees. Time management
programs will allow them to fill in more events into their daily life and reduce
stress.

WHY CHANGE MANAGEMENT?

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Change is the only constant in today’s world. And the rate of change is faster than ever.
You can not escape change. The choice is - You can bring the change yourself at your pace,
place and time, or Allow it to overcome you at its own choosing of time, place and pace.
Fighting against change can slow it down or divert it temporarily, but it won't stop. If you
wish to succeed in this rapidly changing new world "you must learn to look at change as a
friend - one who presents you with an opportunity for growth and improvement." Earlier
you change, higher the benefits. Those who recognise the changing trends and change
simultaneously are successful. Those who anticipate/foresee the impending change and
prepare according are the ones who are hugely successful. But those who lead the change
are the ones who make the fortune.

The rate of change in today's world is constantly increasing. Rate of obsolescence and
therefore replacement is increasing. New, better, safer and cheaper products are entering
the market at constantly decreasing interval. Changes in technology is leading to changes in
business models and customer behaviour. True success and long-term prosperity in the new
world depends on your ability to adapt to different and constantly changing conditions.

But despite all this, basic human nature, that resists change, is still intact. Any attempt to
bring change is fiercely resisted. And if the resistance is not well managed, it can be
catastrophic for the organisation. Therefore, change management assumes criticality.

EVOLUTIONARY (PLANNED) CHANGE VERSUS


REVOLUTIONARY (FORCED) CHANGES

How you change a business unit to adapt to shifting economy and markets is a matter of
management style. Evolutionary change, that involves setting direction, allocating
responsibilities, and establishing reasonable timelines for achieving objectives, is relatively
painless. However, it is rarely fast enough or comprehensive enough to move ahead of the
curve in an evolving world where stakes are high, and the response time is short. When
faced with market-driven urgency, abrupt and sometimes disruptive change, such as
dramatic downsizing or reengineering, may be required to keep the company competitive.
In situations when timing is critical to success, and companies must get more efficient and
productive rapidly, revolutionary change is demanded.
When choosing between evolutionary change and revolutionary action, a leader must
pursue a balanced and pragmatic approach. Swinging too far to revolutionary extreme may
create "an organizational culture that is so impatient, and so focused on change, that it fails
to give new initiatives and new personnel time to take root, stabilize, and grow. What's
more, it creates a high-tension environment that intimidates rather than nurtures people,
leaving them with little or no emotional investment in the company."

CREATING CHANGE FOR IMPROVEMENT AND


COMPETITIVE ADVANTAGE

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Change creates opportunities, but only for those who recognize and seize it. "Seeing is the
first step, seizing the second, and continuously innovating is the third." Innovation
redefines growth opportunities. As current products are becoming obsolete faster than ever,
in order to survive and prosper, organizations continually need to improve, innovate and
modify their products and services. The Silicon Valley slogan "Eat lunch and you are
lunch" is more than a reflection of increasingly intense work ethic. Riding the wave of
change is becoming the most important part of the business. While the economy is shifting
and innovation is rampant, "doing it the same way" is a recipe for corporate extinction.1
Successful change efforts are those where the choices both are internally consistent and fit
key external and situational variables. "You have to find subtle ways to introduce change,
new concepts, and give feedback to people so that they can accept and grow with it."

PERFORMANCE APPRAISALS

WHAT IS PERFORMANCE APPRAISAL?

Performance Appraisals is the assessment of individual’s performance in a systematic way.


It is a developmental tool used for all round development of the employee and the
organization. The performance is measured against a number of factors. These factors can
be divided into two groups.
(a) General personality such as initiative, leadership qualities, dependability,
team spirit, etc.
(b) Professional qualities like job knowledge, quality and quantity of output,
versatility and so on.
Factors vary from organization to organization and job to job. For a soldier, courage and
endurance are more important factors. But for the Army General, his tactical abilities are
more important. On the other side, a foreman in a factory would never be assessed for his
courage. Assessment is often not confined to past performance but checks for potential
performance also. The second definition brings in focus behaviour because behaviour
affects not only employee’s performance but even his peers’ and subordinates’.

Definition 1: “It is a systematic evaluation of an individual with respect to present


performance on the job and his potential.”

Definition 2: “It is formal, structured system of measuring/evaluating job related


behaviours and outcomes to discover how an employee has performed on the job and how
he can perform more effectively in future so that employee, organization and society, all
benefits.”

PERFORMANCE APPRAISALS AND JOB


ANALYSIS RELATIONSHIP

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Job Analysis  Performance Standard  Performance Appraisal


Describes the work and Translate job requirements Describe the individual’s
personnel requirement of a into levels of acceptable or past performance, suitability
particular job unacceptable performance and potential.

Objectives: Performance appraisals are used as a basis for following activities: -


1. Promotions
2. Confirmations
3. Training and Development program planning
4. Compensation reviews
5. Competency building
6. Evaluation of HR Programs
7. Feedback & Grievances

PERFORMANCE APPRAISAL PROCESS

1. Setting Objectives and Standards of performance


2. Design an appropriate appraisal program – Appraisal program for different levels of
employees would be different.
3. Performance Interviews
4. Appraise and record the performance
5. Use and store data for appropriate purposes
6. Identify opportunities variables

TECHNIQUES / METHODS OF PERFORMANCE


APPRAISALS

Numerous methods have been devised to measure the quantity and quality of performance
appraisals. Each of the methods is effective for a particular class of employees in certain
types of organization only.

Broadly all methods of appraisals can be divided into two different categories.

• Past Oriented Methods


• Future Oriented Methods

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PAST ORIENTED METHODS

1. Rating Scales: This is simplest and most popular method. Rating scales consist of
grading an employee’s past performance on a scale of say 1 -10. Each of the selected
performance attribute is numerically marked and then totalled to arrive at the final
figure. Advantages – Adaptability, easy to use, low cost, every type of job can be
evaluated, large number of employees covered, no formal training required.
Disadvantages – Rater’s biases.

2. Checklist: Under this method, checklist of “Statements of Traits” of employee in the


form of Yes or No based questions is prepared. Here, the rater only does the reporting
or checking and HR department does the actual evaluation. Advantages – economy,
ease of administration, limited training required, standardization. Disadvantages –
Rater’s biases, use of improper weights by HR Deptt, does not allow rater to give
relative ratings.

3. Forced Choice Method: A series of statements arranged in the blocks of two or


more are given and the rater indicates which statement is true or false. The rater is
forced to make a choice. HR department does actual assessment. Advantages –
Absence of personal biases because of forced choice. Disadvantages – Statements may
not be correctly framed.

4. Forced Distribution Method: One of the problems faced in large organizations is


relative assessment tendencies of raters. Some are too lenient and others too severe.
This method overcomes that problem. It forces every one to do a comparative rating of
all the employees on a predetermined distribution pattern of good to bad. Say 10%
employees in Excellent Grade, 20% in Good Grade, 40% in Average Grade, 20% in
Below Average Grade and 10% in Unsat grade. The real problem of this method occurs
in organizations where there is a tendency to pack certain key departments with all
good employees and some other departments with discards and laggards. Relatively
good employees of key departments get poor rating and relatively poor employees of
laggards’ departments get good rating.

10% 20% 40% 20% 10%

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Unsat Below Avg Average Good Excellent

5. Critical Incidents Method: It takes cognisance of abnormal incidences only, good or


bad. Supervisors record such incidents as and when they occur. Advantages –
Evaluations are based on actual job behaviours. Ratings are supported by descriptions,
thus favouritism is beaten. Feedback is easy and reduces recency biases. Disadvantages
– Negative incidents may get priority or incidences could be forgotten.

6. Field Review Method: This method is useful only for senior positions in a large
organisation spread over cities and countries. Appraisal is done by someone outside
employees’ own department usually from corporate or HR department. Advantages –
Useful for managerial level promotions, when comparable information is needed, on
employees working at distant locations in different set of conditions. Disadvantages –
Outsider is generally not familiar with employees’ work environment, Observation of
actual behaviours not possible.
7. Performance Tests & Observations: This is based on the test of knowledge or
skills. The tests may be written or an actual presentation of skills. Tests must be reliable
and validated to be useful. Advantage – Tests only measure potential and not attitude.
Actual performance is more a function of attitude of person than potential.
Disadvantages – Some times costs of test development or administration are high.

8. Confidential Reports: Though popular with government departments, its application


in industry is not ruled out. Here the report is given in the form of Annual
Confidentiality Report (ACR). The system is highly secretive and confidential.
Feedback to the assessee is given only in case of an adverse entry. Disadvantage is that
it is highly prone to biases and recency effect and ratings can be manipulated because
the evaluations are linked to future rewards like promotions, good postings, etc.

9. Essay Method: In this method the rater writes down the employee description in the
form of an essay. Advantage – It is extremely useful in filing information gaps about
the employees that often occur in a better-structured checklist. Disadvantages – It its
highly dependent upon the writing skills of rater and most of them are not good writers.
Moreover, it is also time consuming and therefore affects full assessment. Also,
comparative or relative performance among employees is not clearly demarcated.

10. Cost Accounting Method: Here performance is evaluated from the monetary returns
yield to his or her organization. Cost to keep employee, and benefit the organization
derives is ascertained. Hence, it is more dependent upon cost and benefit analysis.

11. Comparative Evaluation Method (Ranking & Paired Comparisons): These are
collection of different methods that compare performance with that of other co-
workers. The usual techniques used may be ranking methods and paired comparison
method.

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• Ranking Method: Superior ranks his worker based on merit, from best to
worst. However how best and why best are not elaborated in this method. It is easy
to administer.

• Paired Comparison Method: In this method each employee is paired with


every other employee in the same cadre and then comparative rating done in pairs
so formed. The number of comparisons may be calculated with the help of a
formula – N x (N-1) / 2. The method is too tedious for large departments and often
such exact details are not available with rater.

FUTURE ORIENTED METHODS

12. Management By Objectives (MBO): Performance is rated against the achievement


of objectives mutually agreed by the employee and the management. Advantage – It is
direct and accurate and transparent.
Disadvantages – Applicable only to quantifiable jobs. Short-term goals given preference at
the cost of long-term goals etc.
13. Psychological Appraisals: These appraisals are more directed to assess employees
potential for future performance rather than the past one. It is done in the form of in-
depth interviews, psychological tests, and discussion with supervisors and review of
other evaluations. It is more focused on employees emotional, intellectual, and
motivational and other personal characteristics affecting his performance. This
approach is slow and costly and may be useful for bright young members who may
have considerable potential. However quality of these appraisals largely depends upon
the skills of psychologists who perform the evaluation.

14. Assessment Centres: This technique was first developed in USA and UK in 1943.
An assessment centre is a central location where managers may come together to have
their participation in job related exercises evaluated by trained observers. It is more
focused on observation of behaviours across a series of select exercises or work
samples. Assessees are requested to participate in in-basket exercises, work groups,
computer simulations, role playing and other similar activities which require same
attributes for successful performance in actual job.

Disadvantages – Concentrates on future performance potential. No assessment of past


performance. Costs of employees travelling and lodging, psychologists. Ratings strongly
influenced by assessee’s inter-personal skills. Solid performers may feel suffocated in
simulated situations.

Advantages – Well-conducted assessment centre can achieve better forecasts of future


performance and progress than other methods of appraisals. Also reliability, content
validity and predictive ability are said to be high in Assessment Centres. The tests also
make sure that the wrong people are not hired or promoted. Finally, it clearly defines the
criteria for selection and promotion.

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15. 360-Degree Feedback: It is a technique in which performance data/feedback/rating is


collected from all sections of people employee interacts in the course of his job like
immediate supervisors, team members, customers, peers, subordinates and self with
different weightage to each group of raters. This technique has been found to be
extremely useful and effective. It is especially useful to measure inter-personal skills,
customer satisfaction and team building skills. One of the biggest advantage of this
system is that assesssees can not afford to neglect any constituency and has to show all-
round performance. However, on the negative side, receiving feedback from multiple
sources can be intimidating, threatening, expensive and time consuming.

Purpose of performance evaluation is to make sure that employee’s goals, employees


behaviour and feedback about performance are all linked to the corporate strategy.

ESSENTIALS OF A GOOD PERFORMANCE


APPRAISAL SYSTEM:

1. Standardized Performance Appraisal System


2. Defined performance standards – Bench Marks
3. Uniformity of appraisals
4. Trained Raters
5. Use of relevant rating tools or methods
6. Should be based on job analysis
7. Use of objectively verifiable data
8. Avoid rating problems like halo effect, central tendency, leniency, severity etc.
9. Consistent Documentations maintained
10. No room for discrimination based on cast, creed, race, religion, region etc.

Problems of Rating:
1. Leniency & Severity – Either too lenient or too severe. All good or all bad.
2. Central Tendency – Majority is crowded around average.
3. Halo/Gholem Effect – Entire assessment is affected by one or few aspects.
4. Rater Effect – Favouritism, stereotyping, hostility, etc, kind of biases.
5. Primacy & Recency Effect – Early period or near end period behaviour effects.
6. Perceptual Sets – Effects of old beliefs about groups, regions, groups, etc

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7. Spill-over Effects – Effects of previous appraisal affecting recent appraisal


8. Status Effect – High esteemed or low esteemed job bearing on the appraisal.

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HUMAN RESOURCE AUDIT

NATURE OF HR AUDIT

HR Audit is a tool for evaluating the personnel activities of an organization. The audit may
include one division or entire company. It gives feedback about HR functions to operating
managers and HR specialists. It also shows how well managers are meeting HR duties.

In short HR audit is an overall control check on HR activities in a division or a company


and evaluation of how these activities support organization’s strategy.

B A S I S O F H R A U D I T (PERSONNEL RESEARCH)

1. Wage Surveys
2. Recruitment Sources effectiveness
3. Training efforts effectiveness
4. Supervisor’s effectiveness
5. Industrial dispute settlements
6. Job Analysis
7. Job Satisfaction Survey
8. Employee needs survey
9. Attitude Surveys
10. Accident frequency surveys

BENEFITS OF HR AUDIT

1. Assessment of contributions of HR department


2. Improvement of professional image of HR department
3. Encouragement of greater responsibility and professionalism among HR members
4. Clarification of HR duties and responsibilities
5. Stimulation of uniformity of HR policies and practices
6. Finding critical personnel problems
7. Ensuring timely compliance with legal requirements

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8. Reduction of HR costs through more effective personnel procedures


9. Creation of increased acceptance of changes in HR department
10. A thorough review of HR information systems

SCOPE AND TYPES OF HR AUDIT

HR Audit must cover the activities of the department and even extend beyond because the
people problems are not confined to HR department alone. Based on this, HR audit can be
spread across following four different categories.

1. Human Resource Function Audit


2. Managerial Compliance Audit
3. Human Resource Climate Audit
(a) Employee Turnover
(b) Absenteeism
(c) Accidents
(d) Attitude Surveys
4. HR - Corporate Strategy Audit

APPROACHES TO HR AUDIT

1. Comparative Approach (Benchmarking with another company)


2. External Authority Approach (Outside consultants’ standards)
3. Statistical Approach (Statistical measures and tools)
4. Compliance Approach (Legal and company policies)
5. Management By Objectives Approach (Goals & Objectives based)

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MOTIVATION THEORIES

Performance is a function of ability and motivation. P = f (A x M)

Definition:

Motivation is a set of forces that cause internal desire in people to behave in certain ways.

MOTIVATION PROCESS (6 STEPS)

1. Identify Individual’s Needs


2. Search for ways to satisfy needs
3. Goal & Objectives directed
4. Increased performance
5. Receiving rewards or punishment
6. Reassessment of needs

CRITICALITY OF MOTIVATION TO MANAGERS

Manager is responsible for improving the productivity of his subordinates and ensuring
that his they contribute towards the objective and mission of the organisation. It is only
possible when employees perform at their maximum efficiency level. Motivation is a tool
to achieve high level of performance from employees. Depending upon the direction,
motivation can achieve one or more of the objectives below: -
1. Motivation improves productivity.
2. Motivation stimulates both participation and production at work
3. Motivation helps employees find new ways of doing a job
4. Motivation makes employees quality conscious
5. Motivation improves job related behaviour.
6. Motivation increases attention towards human resources along with physical
resources

CHALLENGES OF MOTIVATION

1. Diverse and changing workforce


2. Rightsizing, Downsizing, Hire-n-Fire, Pay-for-Performance strategies

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3. Motives can only be inferred, not seen


4. Dynamic nature of human needs

THEORIES OF MOTIVATION

EARLY THEORIES

Scientific Management (F.W. Taylor): Motivation by scientific management is


associated with F.W. Taylor’s techniques of scientific management. Taylor said that people
are primarily motivated by economic rewards and will take direction if offered an
opportunity to improve their economic positions. Based on this Taylor described following
arguments
• Physical work could be scientifically studied to determine optimal method of doing
of a job.
• Workers can be made more efficient by telling them how they were to do a job.
• Workers would accept the above prescription if paid on differentiated piecework
basis.
• Disadvantages – Dehumanized workers, treated them as mere factors of production,
only stressed on monetary needs, ignored human needs.

Human Relations Model (Elton Mayo): Elton Mayo’s human relations model,
developed through Hawthorne Studies, stressed on social contacts as motivational factor.
Greater importance was given to informal groups. However, too much reliance on social
contacts to improve productivity was a major drawback.

CONTEMPORARY THEORIES

Content Theories (Maslow’s Need Hierarchy, Hertzberg’s 2-factors, Alderfer’s ERG,


Achievement Motivation Theory)

Process Theories (Vroom’s expectancy, Adam’s Equity, Porter’s Performance and


Satisfaction Model)

Reinforcement Categories (ERG Theory (Alderfer) Existence - Relatedness - Growth)

ERG theory emphasizes more on three broad needs that is Existence, Relatedness and
Growth. Its hypothesis is that there may be more than one need operating at the same time.
ERG theory further states that when a higher level need is frustrating, the individual’s
desire to increase lower level needs takes place. Thus, ERG theory contains frustration-

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regression dimension. Frustration at higher level need may lead to regression at lower level
need.

Advantages – More consistent with our knowledge of differences among people, it is less
restrictive and limiting, it is a valid version of need hierarchy.

Disadvantages – No clear-cut guideline of individual behaviour patterns, too early to pass


a judgment on the overall validity of the theory.

Two-Factor Theory (Hertzberg)

Fredrick Hertzberg states that the motivation concept is generally driven by two factors of
motivators of job satisfactions and hygiene factors about job dissatisfaction. Motivators are
generally achievement, recognition, the work itself, responsibility, advancement and
growth, which are related to job satisfaction. Hygiene factors deal with external factors like
company policy, supervision, administration and working conditions, salary, status,
security and interpersonal relations. These factors are known as hygiene factors or job
dissatisfiers, job context factors.

Advantages – Tremendous impact on stimulating thought on motivation at work, increased


understanding of role of motivation, specific attention to improve motivational levels, job
design technique of job enrichment is contribution of Hertzberg, double dimensions of two
factors are easy to interpret and understand.

Disadvantages – Limited by its methodology, reliability questioned, it focuses more on job


satisfaction not on motivation, no overall measure of satisfaction utilized, inconsistent with
previous research, productivity factor ignored.

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MORALE

Definition 1:

Morale is a mental condition or attitude of individual and groups, which determines their
willingness to co-operate.

Definition 2:

Morale is attitudes of individuals and groups towards their work environment and towards
voluntary cooperation to the full extent of their ability in the best possible interest of the
organization.

Morale can be said to be a combination of satisfaction, happiness and enthusiasm.

Distinction between Morale and Motivation: -

Morale Motivation
1. Composite of feelings, attitudes and 1. Motivation moves person to action.
sentiments that contribute towards 2. A Process of stimulating individuals
general satisfaction at workplace. into action to accomplish desired goals.
2. A Function of freedom or restraint 3. A Function of drives and needs.
towards some goal. 4. It mobilizes energy.
3. It mobilizes sentiments. 5. Motivation is a potential to develop
4. Morale reflects Motivation. morale.

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PERSONNEL POLICIES

MEANING OF PERSONNEL POLICY

A Policy is a Plan of Action. It is a statement of intentions committing the management to a


general course of action. A Policy may contain philosophy and principles as well. However
a policy statement is more specific and commits the management to a definite course of
action.

Hence Personnel policy is the company’s plan of action towards treatment of its employees
in matters of pay, benefits, welfare, work, etc. A personnel policy spells out basic needs of
the employees. Through personnel policy the personnel department ensure a fair and
consistent treatment to all personnel by minimizing favouritism and discrimination.
Personnel policy serves as a standard of treatment to all employees. Sound personnel
policies help build employee motivation and loyalty. And this happens when personnel
policies reflect fair play and justice and help people grow within the organization.
Personnel policies are also plans of action to resolve intra-personal, inter-personal and
inter-group conflicts.

IMPORTANCE OF PERSONNEL POLICY

Personnel policy is very important for an organization since it gives several benefits for
managing the human resources effectively. Listed below are some of the benefits:
1. Consistent Treatment: Personnel policies ensure consistent treatment of all
personnel throughout the organization.
2. Fair Play & Justice: Personnel policies reflect established principles of fair
play and justice.
3. Minimize Favouritism: Personnel policies help minimize favouritism and
discrimination
4. Promote Stability: Personnel policies ensure continuity of action plan even if top
management is changed. These policies promote stability.
5. Motivation & Loyalty: Sound Personnel policies help build employee
motivation and loyalty.
6. Basic Needs: Personnel policy helps the management to think deeply about basic
needs of organization and the employees.
7. Standard of Performance: Personnel policies serve as a standard of performance.
8. Growth: Personnel policies help people grow within the organization.

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WORKERS’ PARTICIPATION IN MANAGEMENT

Broadly, worker’s participation in management means associating representatives of


workers at every stage of decision-making. Participative management is considered as a
process by which the worker’s share in decision-making extends beyond the decisions that
are implicit in the specific content of the jobs they do. This amounts to the workers having
a share in final managerial decisions in an enterprise.

SCOPE OF WORKERS’ PARTICIPATION

Scope of workers participation ranges over three managerial decision-making stages.


1. Social Decisions: Hours of work, welfare measures, work rules, safety, health,
sanitation and noise control.
2. Personnel Decisions: Recruitment and selection, promotions and transfers,
grievance settlements, work distribution
3. Economic Decisions: Methods of manufacturing, automation, lay offs, shut-
downs, mergers and acquisitions and other financial aspects.

METHODS OF WORKERS’ PARTICIPATION IN


MANAGEMENT

1. Board Level
2. Ownership (share allocation)
3. Complete Control
4. Staff Councils
5. Joint Councils
6. Collective Bargaining
7. Job Enlargement and Enrichment
8. Suggestion Schemes
9. Quality Circles
10. Empowered Teams
11. Total Quality Management
12. Financial Participation

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BENEFITS OF PARTICIPATION

1. Gives identity to an employee


2. Motivates employee
3. Self-esteem, job satisfaction and cooperation improves
4. Reduced conflicts and stress between Management and workers
5. More commitment to goals
6. Less resistance to change
7. Less labour problems
8. Better quality suggestions expected

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UNIONS

Employee associations are popularly known as unions. Although they have become
synonymous with strikes and unreasonable demands, their role is much wider than this.
Unions make their presence felt in recruitment and selection, promotions, training,
termination or lay off. Many programs, which contribute to the Quality of Work Life
(QWL) and productivity, are undertaken by management in consultation with and with the
cooperation of the unions. Unions also participate in deciding wage and salary structure
and negotiate revisions once in 3 or 5 years.

Trade unions are voluntary organizations of workers or employers formed to promote their
interests through collective action. Trade unions Act 1926 defines a trade union as a
combination, whether temporary or permanent formed primarily for the purpose of
regulating the relation between
1. Workmen and Employers
2. Workmen and Workmen
3. Employers and Employers
For imposing restrictive conditions on the conduct of any trade or business and includes
any federation of two or more trade unions

WHY DO EMPLOYEES JOIN TRADE UNIONS?

1. To protect themselves against exploitation by management


2. By force
3. Dissatisfaction
4. Lack of Power
5. Union Instrumentality

ROLE OF CONSTRUCTIVE AND POSITIVE


UNION

Unions have a crucial role to play in Industrial Relations. Unions have following broad role
or objectives as mentioned below.
1. To redress the genuine grievances of individual worker vis-à-vis the individual
employer, by substituting joint or collective action for individual action.

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2. To secure improved terms and conditions of employment for its members and the
maximum degree of security to enjoy these terms and conditions.
3. To obtain improved status for the worker in his work or her work
4. To increase the extent to which unions can exercise democratic control over
decisions, which affect their interests by power sharing at the national, corporate
and plant levels.
The union power is exerted primarily at two levels. Industry level to establish joint
regulation on basic wages and hours with an employer’s association. Plant level, where the
shop stewards organizations exercise joint control over some aspects of the organization of
work and localized terms and conditions of employment.

Unions are party to national, local and plant level agreements, which govern their actions to
a greater or lesser extent, depending on their power and on local circumstances.

UNFAIR LABOR PRACTICES

Industrial Disputes Act, 1947, specifies the following as unfair labour practices:
1. To interfere, restrain, coerce workmen in the exercise of their right to organize,
form, join or assist a trade union.
2. Threatening workmen with discharge or dismissal
3. Threatening of lockout or closure
4. Granting wage increases to undermine trade union efforts
5. To dominate, interfere with or support financially or socially by taking active
interest in forming own trade union, and
6. Showing partiality or granting favours to one of several trade unions
7. To establish employer sponsored trade unions
8. To encourage or discourage memberships in any trade union by discriminating
workman by punishing or discharging, changing seniority ratings, refusing
promotions, giving unmerited promotions, discharging union office bearers
9. To discharge or dismiss workmen by victimizing, not in good faith, implicating in
criminal case for patently false reasons.
10. To abolish work of a regular nature
11. To transfer workmen
12. To show favouritism or partiality
13. To replace workers
14. To recruit workmen during legal strikes
15. To indulge in acts of violence or force

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16. To refuse collective bargaining


17. Proposing and continuing lockouts

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ORGANIZATIONAL DOWNSIZING

Downsizing necessarily means reducing work force to an optimal level depending upon the
business conditions and organizational needs. It is said that an organization should be
rightly staffed ie. It should not be overstaffed and or understaffed. There are broadly
following method used to downsize the workforce as mentioned below.

RETRENCHMENT

It means termination of service. It is a termination for reasons other than disciplinary


actions, retirement or superannuating, expiry and termination of contract or prolonged
illness. Retrenchment compensation and notice for retrenchment are only pre-conditions for
retrenchment. If notice and compensation are not given, the worker will not be called as
retrenched. Compensation is payable for 15 days wages for every completed year of service
besides one month’s notice or pay in lieu of notice. But employee should have completed at
least one year of complete service in order to receive compensation.

LAY OFFS

Lay off is inability of the employer to provide employment to workers due to


circumstances beyond his control such as shortage of power, coal, breakdown of
machinery, natural calamity etc. It is not a termination of service. Lay off compensation
can be claimed as a statutory right by the worker if he has completed one year of
continuous service or has worked for 240 days on the surface or 190 days underground in
12 calendar months. Compensation payable is half of the wages.

VOLUNTARY RETIREMENT SCHEMES

VRS are announced when there is a huge pool of old aged manpower occupying senior
positions amounting to surplus. Many organizations are providing liberal incentives to
leave before age of superannuation. VRS in other words is a retirement before the age of
retirement.

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