Module-I, Ch-1 Introduction to Human Resource Management

What is HRM?
The Policies and practices involved in carrying out the People or human resource aspects of a management position, including recruiting, selecting, training, developing, and appraising. There are five basic functions all managers perform: - planning - organizing - staffing - leading - controlling

 Planning: establishing goals and standards, developing rules and procedures, developing plans and forecasting Organizing: giving each subordinate a specific task: establishing departments, delegating authority to subordinates, establishing channels of communication, coordinating the work Staffing: determining what should type of employees should be hired, recruiting, selecting, setting performance standards, compensating, evaluating, counseling, training, and developing Leading: getting others to get the work done, maintaining morale, motivating subordinates Controlling: setting standards such as sales quotas, quality standards, or production level, comparing

Definition
Human Resource Management is the Process of acquiring, training, appraising, and compensating employees, and of attending to their labour relations, health and safety, and fairness concerns. Human Resource Management is the 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.

Objectives
To act as a liaison between the top management and the employees. To arrange and maintain adequate manpower inventory, which, in turn, ensures the smooth working of the organization. To offer training as a way of developing skills, enhancing productivity and, most importantly, increasing individual and organizational performance to achieve the desired results. To devise employee benefit schemes for improving employee motivation and group morale and enhancing employer-employee cooperation.

 To ensure and enhance the quality of work life, which refers to the employees perception of their physical and psychological well-being at work. to help keep up ethical values and behaviour amongst employees both within and outside the organization.

Function of HRM
Function of HRM

Managerial Function Planning Organizing Staffing Directing Controlling

Operative Functions Procurement Development Compensation Maintenance and Motivation Integration Industrial Relation

 Planning: the process of predetermining the personal programmer that are necessary to attain the organizational goals. It is an effective tool to deal with the future. Planning is such a crucial function for an organization that it is the key to all other managerial functions. The steps involved in planning are:
Establishing goals and objectives to be achieved Developing rules and procedures Determining plans and forecasting techniques

 Organizing: it is a process through which the firm establishes its structure and determines the authority, responsibility and accountability of each members in relation to the job. It is a next step to organize the men and material in order to accomplish those plans. It involves:
Giving each members a specific tasks Establishing departments and divisions Delegating authority to the members Establishing channels of authority and communication Creating a system to coordinate the works of the members

 Staffing: This function is deal with the creation and maintenance of human resources through employment, compensation, benefits, training, and development and industrial relations measure. It include:
Determine the type of people to be hired Recruiting prospective employees and selecting the best ones from them Compensating the employee Training and developing the employees Setting performance standard Evaluating employees performance Counseling the employee

 Directing: Is the sum of several activities like communication, leadership and motivation. It includes following activities:
Getting work done through subordinates Ensuring effective two-way communication for the exchange with the subordinates Motivating subordinates to strive for better performance Maintaining the group morale

 Controlling: controlling is the process of checking the efficiency of the individual and the groups in fulfilling the plans and goals through follow-up measures. It is essential for continuous improvement in the managerial activities. The process include:
Establishment of standard performance Measurement of actual performance Comparison of actual performance with the standard one to find the deviation Initiation of corrective actions, if there are any deviations

Operative Function of HRM

Procurement Job analysis & design HR Planning Recruitment Selection Placement Orientation Socialization

Development Career planning & development Workers training Executive Development OD

Compensation Job Evaluation Performance Evaluation Wages administration Incentives & benefits

Maintenance & motivation Employee well being Social security workers participation Motivation Job rotation HR records, research, & audit

Integration Industrial Relation Discipline Grievance redressal Dispute settlement Collective bargaining

Why is HRM important to all Managers The concepts and techniques are important to managers
for not committing the following mistakes while managing: Hire the wrong person for the job Experience high turnover Have your people not doing their best Waste time with useless interviews Have your company taken to court because of discriminatory actions Have your company cited under federal occupational safety laws for unsafe practices Have some employees think their salaries are unfair and inequitable relative to others in the organization Allow a lack of training to undermine your departments effectiveness Commit any unfair labor practices

Qualities of an HR Managers
Knowledge Intelligence Communication skills Objectivity and fairness Leadership and Motivational Qualities Emotional Maturity Empathy

Line and Staff Aspects of HRM

Authority: The right to make decisions, direct others work, and give orders Line Authority: The authority exerted by an HR Manager by directing the activities of the people in his or her own department and in service areas (like the plant cafeteria) Staff Authority: It gives the manager the right to advise other managers or employees Line Manager: A manager authorized to direct the work of subordinates and responsible for accomplishing the organizations tasks Staff Manager: A manager who assists and advises line managers

Line Managers Human Resource Duties The direct handling of people is an integral part of every line
managers duties. For effective human resource management, following are the general headings: Placing the right person on the right job Orientation of employees Training of employees Improving their job performance Gaining creative cooperation and developing smooth working relationships Interpreting the companies policies and procedures Controlling labor costs Developing their abilities Creating and maintaining department morale Protecting employees health and physical condition

Human Resource Managers Duties

The Human Resource Manager carries out three distinct functions: A line function: - The HR Manager executes the role of Line manager - They are likely to exert implied authority - Has access to top management in areas like testing and affirmative action A Coordinative function: - HR Manager coordinates personnel activities, a duty often referred to as Functional authority (functional control) - He or she acts as right arm of the top executive to ensure the line managers are implementing the firms human resource policies and practices (For e.g. adhering to its sexual harassment policies)

Cont.
Staff (assist and advise) functions: - Assisting and Advising Line Managers is the heart of HR Managers job - Advises CEO to better understand the personnel aspects of the companys strategic options - Assist in the Management process - helps line managers comply with equal employment and occupational safety laws - plays an important role in handling grievances and labor relations - plays an innovator role by providing up-to-date information on current trends and new methods for better utilizing companys human resource

Cont.
- plays an employee advocacy role by helping to define how management should be treating employees Employee Advocacy: HR must take responsibility for clearly defining how management should be treating employees, make sure employees have the mechanisms required to contest unfair practices, and represent the interests of employees within the framework of its primary obligation to senior management

The changing environment of HRM

Changes occurring today are requiring human resource managers to play an increasingly central role in managing companies. These changes or trends include Globalization Trends Technological Trends Trends in the nature of work Workforce Demographics Trends

Globalization Trends
Globalization is the tendency of the firms to extend their sales, ownership, and/or manufacturing to new markets abroad. Sony, Apple, Nike, Mercedes Benz market all over the world. Indian firms like Infosys, TCS, Wipro, and Satyam serve the customers by developing software codes and supporting their IT systems Tata Steel and Mittal Steel have acquired steel plants and have gained a place among global manufacturers GE, American Express, Dell, Google provide backoffice support operations to global customers

Cont.
Companies expand abroad for several reasons: Sales Expansion Seeking new foreign products and services to sell Cut labor costs Forming partnership Implications: - More globalization means more competition and more competition means more pressure to be World class Lower costs Make employees more productive Do things better and less expensive

Technological Trends
Computerized manufacturing system Computerized services Virtual online communities to improve efficiency For e.g. Indian Railways (computerized ticket booking facility) and Air Deccan (low cost air travel and popularized e-ticketing) Implications: Impart training to employees Hire technology oriented human resource Make employees more productive than before

Trends in the Nature of Work

High-Tech Jobs The modern Blue-collar worker Service Jobs Dell computers and Laptop Knowledge work and Human capital Human Knowledge and skill is considered to be the most important asset of an organization Implications: the key to effectively utilizing this technology is not the technology but the people

Workforce Demographics Trends

Finding and hiring good employees IT sector, financial services sector, manufacturing, and retail business have created a huge demand for skilled labors Implications: A demographic dividend must be carried out with the trained workforce growing older and young workforce in challenge.

The changing role of Human Resource Management

With these trends, the human resource managers job has grown more broader and more strategic over time. The points to be given focus are as follows: Strategic Human Resource Management Creating High Performance Work Systems Measuring the human resource management teams performance Managing with the HR Scorecard Process

Strategic Human Resource Management

The HRM Function in India has evolved over time. With the development of the knowledge industry and the resulting high demand for the people, the HR function started to take a strategic focus. Strategy: The companys long-term plan for how it will balance its internal strengths and weaknesses with its external opportunities and threat to maintain a competitive advantage. Strategic Plan: same as a strategy Strategic HRM: formulating and executing human resource policies and practices that produce the employee competencies and behaviors the company needs to achieve its strategic aim.

Cont.
The essence of strategic planning is to ask, Where we are now as a business, where do we want to be, and how should we get there? Some companies today involve their Human Resource Managers in both designing and executing their companys strategies.

Creating High Performance Work Systems

The emphasis on Human Resource Management is one change in what human resource managers do, a focus on productivity and performance is another. Effective HRM practices can improve performance in three main ways: Through the use of technology Through effective human resource practices By instituting high-performance work systems Managing with technology: Technological applications improve HRs performance in four main ways: self-service, call centers, productivity improvement, and outsourcing.

Cont
Many firms are installing Internet and computer based system for improving HR productivity. Technology also makes it easier to outsource HR activities to specialist service providers. Effective HR Practices: screening employees through personality testing can produce employees who perform better (people with the right traits for the job did the job better). High-Performance Work Systems: An integrated set of HRM policies and practices that together produce superior employee performance.

Some of these practices include:

Employment security Selective hiring Extensive training Self-managed teams Decentralized Decision Making Reduced status distinctions between managers and workers Information sharing Contingent rewards Emphasis on high-quality work

Measuring the human resource management teams performance

In todays performance based environment, employers naturally expect their human resource management teams to provide measurable evidence of their efficiency and effectiveness and for that of their proposed programs. They need to answer the following questions: How much will the new testing program help in reducing employee turnover? How much more productive the employees be if the training program being instituted? How productive will be the HR team as compared to the competitors?

Cont.
Metrics is a set of quantitative performance measures HR managers use to assess their operations. Five sample HR metrics are as follows: Absence Rate: measures absenteeism Cost per Hire: measures costs involved with a new hire HR expense factor: measures HR expenses in relation to the total operating expenses of organization Time to fill: measures Number of days from which Job requisition was approved to new hire start date Turnover Rate: measures the rate for which employees leave a company

Managing with the HR Scorecard Process

For most human resource management activities, one can similarly map out the cause-and-effect links, from the human resource activity, to the employee behavior, to the employee performance. Managers use The HR Scorecard Process to measure the HR functions effectiveness and efficiency in producing employee behaviors needed to achieve the companys strategic goal. It is a concise measurement system.

The Human Resource Managers Proficiencies

Being a human resource manager today is challenging and requires several proficiencies as follows: HR Proficiencies: represent traditional knowledge and skills in areas such as employee selection, testing, and compensation. Business Proficiencies: reflect human resource professionals new strategic role. Leadership Proficiencies: lead management groups and drive the changes required. Learning Proficiencies: ability to apply all the new technologies and practices affecting the profession.

Cont.
HR Qualifications Managing with the Law Managing Ethics