CHAPTER 1 INTRODUCTION TO HUMAN RESOURCE MANAGEMENT

Human Resources
HR is the total knowledge, skills, creative abilities, talents and aptitudes of an organisations workforce as well as the values, attitudes and beliefs of the individuals involved.

What is Human Resource Management (HRM)?

Human resource management is the effective use of human resources in order to enhance organizational performance HRM is the art of procuring, developing and maintaining competent workforce to achieve goals of an organisation in an effective and efficient manner

Evolution of HRM Concept

Labour / Manpower denotes physical abilities & capacities of employees commodity - wages based on demand & supply Personnel persons employed in service employees as a whole HR- denotes resources of all the people who contribute their services to the attainment of organisational goals

Evolution of HRM
Period
1920-30 1940-60

Emphasis
Welfare management Paternalistic practices Expanding the role to cover labor, welfare, industrial relations and personnel administration

status
Clerical Administrative

Roles
Welfare administrator Policeman Appraiser Advisor Mediator Legal advisor Fire fighting

1970-80

Efficiency, effectiveness dimensions added emphasis on human values, aspirations, dignity, usefulness

Developmental

Change agent Integrator Trainer Educator

Developer Counselor Coach Mentor Problem solver Compete with the best and win

1990-2000

Incremental productivity gains Proactive, through human assets growth-oriented

Post 2000

Aggressive cost cutting in order to compete in a global environment

Fight for survival to live for another day

Importance of HRM
HR most important resource Put other resources to proper use Helps transform lifeless factors of production into useful products Capable of enlargement produce extraordinary things when inspired (Competitive Advantage) Can help organisation achieve results quickly, efficiently & effectively

Objectives of HRM
Maximize the return on investment from the organization's human capital and minimize financial risk To align the capabilities and behaviors of employees with the short-term and long-term goals of the organisation

OBJECTIVES OF HRM
Personal Objectives

Societal Objective

Objective of HRM

Organizational Objective

Functional Objective

Objectives of HRM
Societal objectives To be ethically & socially responsible to the needs of the society while minimizing the negative impact of such demands upon the organization Organizational objectives To recognize the role of HRM in bringing about organizational effectiveness Functional objectives To maintain the departments contribution at a level appropriate to the organizations needs Personal objectives To assist employees in achieving their personal goals in a manner that their personal goals enhance the individuals contribution to the organization

Objectives
1 2

Societal objective
Legal compliance Benefits Union-management relation

Organizational objective
Human resource planning Employee relations Selection Training and development Appraisal Placement Assessment

3.

Functional objective
Appraisal Placement Assessment

4.

Personal objectives
Training and development Placement Appraisal Compensation assessment

ENVIRONMENT OF HRM
Type of environment
Internal Environment External Environment
Internal Environment A. Union plays B. Culture of organization C. Fast changing technology D. Social norms regulating individual conduct E. Individuals the organization F. Isolation or culture values conflict G. Self-estrangement usage H. Values I. Image J. Rules

External Environment
Social environment Economic environment With the impact of globalization and rationalization Role of union and union leaders Cultural forces Political and legal Economically and socially weaker section Religious values

Scope of HRM
Prospects of HRM Nature of HRM

Industrial Relations

Employee Hiring

HRM

Employee Maintenance

Employee & Executive Remunerat ion Employee Motivation

Very vast Covers all major activities in the working life of a worker - from time an individual enters into an organization until he or she leaves, comes under the purview of HRM

Human Resource Management Functions

Recruitment

Recruitment
The process by which a job vacancy is identified and potential employees are notified
The nature of the recruitment process is regulated and subject to employment law Main forms of recruitment: through advertising in newspapers, magazines, trade papers and internal vacancy lists, company websites

Recruitment
Job description outline of the role of the job holder
Person specification outline of the skills and qualities required of the post holder Applicants may demonstrate their suitability through application form, letter or curriculum vitae (CV)

Selection

Selection
The process of assessing candidates and appointing a post

holder Applicants short listed most suitable candidates selected Selection process varies according to organisation

Selection
Interview most common method
Psychometric testing assessing the personality of the

applicants will they fit in? Aptitude testing assessing the skills of applicants In-tray exercise activity based around what the applicant will be doing, e.g. writing a letter to a disgruntled customer Presentation looking for different skills as well as the ideas of the candidate

Employment Legislation

Employment Legislation
Increasingly important aspect of the HRM role Wide range of areas for attention Adds to the cost of the business
Even in a small business, the legislation relating to employees is important chemicals used in a hairdressing salon for example have to be carefully stored and handled to protect employees.

Discrimination
Crucial aspects of employment legislation:
Race Gender Disability

Disability is no longer an issue for employers to ignore, they must take reasonable steps to accommodate and recruit disabled workers.
Copyright: Mela, http://www.sxc.hu

Discipline

Discipline
Firms cannot just sack workers
Wide range of procedures and steps in dealing with workplace conflict
Informal meetings Formal meetings Verbal warnings Written warnings Grievance procedures Working with external agencies

Development

Development
Developing the employee can be regarded as investing

in a valuable asset
A source of motivation A source of helping the employee fulfil potential

Training

Training
Similar to development: Provides new skills for the employee Keeps the employee up to date with changes in the field Aims to improve efficiency Can be external or in-house

Rewards Systems

Rewards Systems
The system of pay and benefits used by the firm to reward

workers Money not the only method Fringe benefits Flexibility at work Holidays, etc.

Trade Unions

Trade Unions
Importance of building relationships with employee representatives
Role of Trade Unions has changed Importance of consultation and negotiation and working with trade unions Contributes to smooth change management and leadership

Productivity

Productivity
Measuring performance: How to value the workers contribution Difficulty in measuring some types of output especially in the service industry Appraisal
Meant to be non-judgmental Involves the worker and a nominated appraiser Agreeing strengths, weaknesses and ways forward to help both

employee and organisation

Motivation
Motivating employees to perform up to their potential is the key to maintaining a productive, successful business Ways in which you can motivate employees Interact - Talk to your employees regularly Recognition & Appreciation - A job well done should be appreciated and encouraged Pay them Right - Pay employees for what they are worth and they will be happy to work. New challenges - Give employees new and interesting challenges to keep them stimulated and learning

HRM Challenges
With the ongoing changes in Human Resources Management (HRM), its important that managers, executives and HR employees, specifically, be aware of the challenges that todays HRM team may face. While there are certainly other issues, these are common to most any type business or size of company and having policies in place to ensure these challenges are met head-on can make the workplace more settled and peaceful for everyone.

1. 2. 3. 4. 5.

Workplace diversity Change management Compensation and benefits Recruiting skilled employees Training and development.

First Project Assignment

Pick a company
Big companies are usually easier This is first come, first served Try to think of companies that face unusual or especially interesting HR challenges.
Start with some basic information about the company
Logisticssize and complexity Product market description Strategic goals

Divide up the papers organizational context section

Also consider structure and culture

How is the company managed overall? What is the companys culture?

Mercers 2006 Best Companies to Work For in India

Infosys Technologies Limited (IT industry). MindTree Consulting (IT industry). Satyam Computer Services Limited (IT industry). Dr. Reddys Laboratories Limited (pharmaceutical company). Sapient Corporation (business and technology consulting). Agilent Technologies (IT industry). Johnson & Johnson (consumer health care company). Covansys India (IT industry). HCL Comnet (IT industry). HSBC; Hongkong and Banking Corporation (banking services).