Human Resources Management

Akio Morita, founder of Sony corporation once said

there is no magic in the success of Japanese
companies.
Its how they treat their people.
Worlds leading food company Nestles CEO, Peter
Brabeck Every single person in the organization
should ask himself or herself-is there anything I can
do to add a little more value to our company.

Evolution of HRM
The development of Personnel Management
US & UK. Voluntary
Indiagovernment interventions & Compulsions
20th Century there was a loss in production due to
industrial dispute which was because of the
malpractices in the recruitment of workers and
payment of wages.
The Royal Commission of labour in India (1931)
under the chairmanship of J.H.Whitley
recommended the abolition of the jobber system
and appointed labour officers to perform
recruitment and welfare activity.

Conti.
After independence Labour officer was
identified as personnel manager
Factories law
Pragmatic and flexible approach.

Importance of HRM
Social significance
Professional significance
Significance for individual enterprise

Objectives of HRM
Primary objectives
Goods and services
Monetary and non monetary
Satisfaction of community

Secondary objectives
Achieving the primary objectives economically,
efficiently and effectively.

Role of HR
First appeared
Files clerk
Record keeper
Liaison man
Trouble shooter

Modern era
Consience
Counsellor
Mediator
company spokesman
Problem solver
Change agent

Personnel policies
Policy is a pre determined, selected course
established as a guide towards accepted goals
and objectives
General and specific
examples

HRIS
HRIS is a systematic way of storing data and
information for each individual employee to
aid planning, decision making, and submitting
of returns and reports of the external
agencies.

Human resource planning

Effective HRP is a process of analyzing an
organizations human resources needs under
changing conditions and developing the
activities necessary to satisfy these needs.
HRPs effectiveness depends on the existing
manpower utilised and future needs are met.
Need forecasting and advance planning

Cont
Individual plans
Organizational plans
Development plans
Societal pressures
Long range plans
Management Development
Career planning

Link between HRP and Strategic

Planning
Companys commonly prepare annual forecasts of
staffing needs as a base for external recruitment,
promotion and annual training programme planning.
They fail to consider long-range business plans and
needs, such as new facilities, new products,
retrenchment and expansion.
A manufacturing firm established a palnt in Gurgaon.
Due to lack of expertise and the market the company
was sold to a European company.

Recruitment
Recruitment is the process of
searching for Prospective
employees and stimulating
them to apply for the job in the
organization.

Sources of Recruitment
Internal sources
-Stimulating transfer and promotion
-Increase morale
- Past Performance Appraisal
External sources
-Lower entry jobs, expansion, specifications
cannot be met
Boomerang employees

External sources
Advertisement
Employment Exchange
Educational Institutions
Placement Agencies
On- Site Visits
Internships
Referrals and Walk-Ins
Labour Unions
Nepotism
Leasing

Selection decisions comprises

1. Determine the nature of job to be filled
2. Determine the type of personnel
required
3. Determine the sources of recruitment
4. Determine the selection process

Selection
It is the process of discovering qualifications
and characteristics of the job applicant in
order to establish their likely suitable for the
job position.
Two Types of errors
Reject errors
Select errors

Contd
Good selection requires a method
What am I looking for
Analyze the job
How do I find out?
Recruit through agencies and consultancy
How can I recognize when I see it
Select through application forms

Stages in selection process

Stage 1: Screening of Application forms
Stage 2: Tests
Intelligence
Aptitude
Ability
Interest
Performance
-Work Sampling
-Assessment Centres

Contd
Psychological test
1. Intelligence tests
general traits
-Word fluency
-Verbal Comprehension
-Arithmetical ability
2. Aptitude tests
3. Interest test
4. Personalitytest
Thematic Apperception test
Rorschach ink blot test

Contd..
Stage 3: Selection interview
Stage 4: Selection Decision
PLACEMENT
Placement may be defined as the
determination of the job to which an accepted
candidate is to be assigned and his assignment
to that job.

Socialization
A process of adaptation to a new culture of
the organization.
IBM, Wal-Mart, P&G and Nestle

Socialization Process
Productivity

Pre-arrival

Encounter

Metamorphosis

Commitment
Turnover

Training and Development

Training may be defined as a planned
programme designed to improve performance
and to bring about measurable changes in
knowledge, skills, attitude and social behavior
of employees for doing a particular job.
- focus on soft-skills- interpersonal
communication, teamwork, Innovation and
leadership.

Principles of Learning
1. Initial motivation or readiness
2. Multiple response or response by trial and
error
3. Selection of responses through
reinforcement
4. Principle of Extinction
5. Law of exercise in habit formation

Purpose of Training and Develoment

-Creating a pool of readily available and
adequate replacements for personnel.
-Enhancing the companys ability to adopt and
use advances in technology because of a
highly knowledgeable staff
-Expansion programmes

Training methods
On the job techniques
- coaching
-orientations
-job instruction training
-apprenticeships
-job rotations
-assistantships
-internships

contd
Off the job techniques
-lectures, special study, films, television
conferences or discussions, case studies, roleplaying, simulation exercises, sensitivity
training, TA,

Knowledge Management
Knowledge Management is a systematic,
explicit and deliberate building, renewal and
application of knowledge to maximise an
enterprise knowledge related effectiveness
and returns from its knowledge assets
Industrial economy based on assembly lines
and hierarchical control to a global
decentralised information driven economy.


Knowledge Management Architecture
1. Tactic
2. Explicit
Explicit knowledge is formal knowledge that
can be packaged as information, reports,
articles, manuals, patents, pictures, video
images, sound, software etc.

KM Life cycle
Knowledge life cycle
1. Capturing 2. Organizing
3. Refining
4. Transfer
Knowledge
Understanding gained through experience or
study.

..
Tactical knowledge is personal knowledge
embedded in individual experience and is
shared and exchanged through direct face
face contact.
The four components of KMA
1. Developing New Knowledge
2. Securing New and Existing knowledge
3. Distributing Knowledge
4. Combining available Knowledge

Knowledge Management Process

Beckmans has proposed a comprehensive 8stage process for KM.
1. Identify
2. Collect
3. Select
4. Store
5. Share
6. Apply
7. Create
8. Sell

Compensation Management
CM goal is to design the lowest cost pay
structure that will attract, motivate and retain
competent employees.
Consequences of pay Dissatisfaction
1. Performance
2. Strikes
3. Grievances
4. Other jobs
5. Absenteeism & Turnover
6. Poor mental health

..
CM
- Direct Compensation( wages, salaries,
incentives, gains)
- Indirect Compensation (Fringe benefits)
Objectives of CM
1. Acquire qualified personnel
2. Retain present employees
3. Reward desired behavior
4. Control cost
5. Comply with legal regulations

..
Major phases of CM
Phase 1
Identify and study jobs
-job analysis
Phase 2
Internal Equity
-Job Evaluation
1. Job Ranking
3. Factor Comparision

2. Job Grading
4. Point System

..
Factors
Responsibility
Skill
Mental effort
Physical effort
Working Conditions

..
Factor Comparision
Steps
1. Determine the compensible factors
2. Determine key jobs
3. Apportion present wages for key jobs
4. Place key jobs on a factor Comparision
Chart
5. Evaluate other jobs

..
Point system
1. Determine critical factors
2. Determine the levels of factors
3. Allocate points to subfactors
4. Allocate points to levels
5. Develop the point manual
6. Apply the point system


Phase 3
External equity
- wage and salary surveys
Phase 4
Matching internal and external worth

Reward system
An incentive or a reward can be anything that
attracts the workers attention and stimulates
him to work.
Compensation
1. Monetary
2. Non- Monetary

Factors determining rewards

1. Performance
2. Effort
3. Seniority
4. Skills held
5. Job difficulty
6. Discretionary time

Non-Monetary rewards
1.
2.
3.
4.
5.

Treats-free lunches, dinner, Bday treats

Knick-Knacks-Tie pins, Calendars, T-Shirts
Awards- Trophies, Certificates
Environment-Flexible hours, Music
Social Acknowledgement-Friendly greetings,
membership of clubs
6. Tokens- Movie tickets, Vacation trips

Career Development

Career is progress or general course of action

of a person in some profession or in an
organization.

Career Development Initiatives

Career Planning Workshops
Career Counselling
Mentoring
Sabbaticals
Personal Development Plans
Career workbooks

Mentor & Protege Relationships

Mentor- Superior, Leader, Manager
Protege-Sub-ordinate, Followers

Relationship can be increased and developed

by imparting Counselling sessions.

Promotion
A promotion is the transfer of an employee
in an organisation to a job which pays more
money or one that carries some preferred
status.
Demotion
Demotion has been defined as the
assignment of an individual to a job of lower
rank and pay usually involving lower level of
difficulty and responsibility

Transfers
Yoder and associates have defined transfer as
a lateral shift causing movement of
individuals from one position to another
usually without involving any marked change
in duties, responsibilities, skills needed or
compensation

Controlling
Controlling is the measurement and
correction of performance in order to make
that enterprise objectives and the plans
devised to attain them are accomplished
Control process
1. Establishing Standards
2. Measuring performance against standards
and
3. Correcting variations from standards and
plans

Performance Appraisal system

Performance Appraisal refers to all those procedures
that are used to evaluate the personality, the
performance, and the potential of its group
members.
Objectives of Performance Appraisal
1. Providing basis for
promotion/transfers/termination
2. Enhancing employees effectiveness
3. Aiding in designing T& D
4. Developing interpersonnel relationship
5. Counselling, Controlling & Wage Administration

Methods of Performance Appraisal

Past Oriented
i. Ranking method
ii. Paired Comparison method
iii. Graphic Rating scale method
iv. Checklists
v. Forced Choice list method
vi. Critical Incidents method
vii. Forced Distribution method

Condt
viii. BARS
ix. Field Review
x. Tests and Observations
xi. ACRS
xii. Essay method
xiii. Cost accounting

Condt
Future Oriented method
1. MBO
2. 360 degree Appraisal
3. Psychological appraisals
4. Assessment Centres
540 degree feedback-Customer and Suppliers
720 degree feedback- Family and stakeholders

Appraisal process
Objectives of Performance Appraisal
Establish Job Expectations
Design an Appraisal Programme
Appraise Performance
Performance interview
Archive Appraisal Data
Use Appraisal Data for Appropriate Purpose

Components of Employee Remuneration

Environment
Financial

Hourly and
Monthly
Rated
Wages
Salaries

Non -financial

Incentives

Fringe
Benefits

Perquisites

Individual
Plans
Group
Plans

Company car
P.F. Gratuity Club
Medical
membership
care
Paid holidays
Accident
Furnished
relief
house
Health and Stock option
Group
schemes, etc.
insurance,
etc.

Job Context
Challenging job
Responsibilities
Recognition
Growth prospects
Supervision
Working conditions
Job sharing, etc

Benefits
Indirect financial and nonfinancial payments
employees receive for continuing their
employment with the company.

Benefits picture today

Wages and salaries- 72.1%
Legally required benefits- 8.5%
Insurance- 6.9%
Paid Leave-6.5%
Retirement and savings-3.0%
Supplemental pay- 2.8%

Zappos
Zappos, a Las Vegas based online shoe and
apparel retail company, is considered one of
the 100 Best Companies to Work For. The
company was formed just 10 years ago and
employs 1500 people. Zappos boasts over a
billion dollars in annual sales and job perks
that includes free massages, tailoring and
lunch. They have a nap room, life coach and
company sponsored concierge services.

Zappos values
Tony Hsieh, the CEO at Zappos believes that
creating and supporting a work culture that
employees enjoy is critical for organizational
success. Having fun at work is a priority and
being weird is encouraged. Hsieh comments,
"It's definitely part of our culture to bring out
happiness in employees, because it's only with
happy employees that they can bring out the
happiness in customers through better
customer service."

Classification of benefits
1. Pay for time not worked
2. Insurance benefits
3. Retirement benefits
4. Services

Pay for time not worked

It is also called as supplemental pay benefits
which are the benefits for time not worked
such as unemployment insurance, vacation
pay and holiday pay and sick pay.
Unemployement Insurance
Provides benefits if a person is unable to work
through some fault other than his or her own.

Pay for time not worked

Vacations and Holidays
The number of paid employee vacation days
varies considerably from employer to
employer ranging from one week to five
weeks based on the experience in the same
company.
Sick leave
Provides pay to an employee when he or she
is out of work because of illness.

Pay for time not worked

Parental leave and the family and medical
leave Act
It is an important benefit availed from about
80% of women workers.
Severance Pay
A one time payment some employers provide
when terminating an employee. (downsizing39 to 30 weeks, I week- I year of service.)

Pay for time not worked

Supplemental Unemployment Benefits
Provide for a guaranteed annual income in
certain industries where employers must shut
down to change machinery or due to reduced
work.

Insurance Benefits
Workers compensation
Provides income and medical benefits to
work- related accident victims or their
dependents regardless of fault.
Group life insurance
Provides lower rates for the employer or
employee and includes all employees,
including new employees, regardless of health
or physical condition.

Retirement benefits
Social Security
Pension Planning
Pension Alternatives- early retirement
windows
A type of offering by which employees are
encouraged to retire early, the incentive being
liberal pension benefits plus perhaps a cash
payment.
Cash balance pension plans

Personal Services
Employee Assistance Programs
Family- Friendly Benefits
Subsidized child care
Elder care
Flexible benefits Programs

Grievances
Complaint
Indication of employee dissatisfaction.
Grievance
Complaint formally stated in writing.
Grievance procedures
Formal channels of communications used to
resolve grievances.

Steps in a Grievance Procedure

Step5:
Arbitration by: Impartial third party
Step4:
Meeting between: National Union Representative &
Company Executive or Corporate Industrial Relations
Officer
Step3:
Meeting between: Committee of Union Officers & Company
Managers
Step2:
Meeting between: Chief Steward & Supervisors Manager
and/or HR Manager
Step1:
Discussion of written grievance between: Union Steward &
Supervisor