Introduction to Human

Resource Management

Objective
Explain What is Human Resource
Management (HRM)
Define Human Resource Management
Explain the importance of HRM
Explain the Scope of Human Resource
Management
Describe the Evolution of HRM of HRM
Explain the Skills of HR Professionals
Explain the difference between Personnel
Management and HRM
Explain the Duties and responsibilities of HR
manager
List the Tips for Effective HRM
Best HR practices of Companies

Introduction
Look at the questions given below and try answering them.

Whom do you send your resume to when you see a job

opening that interests you?

Who gives you the job offer and discusses your pay
package with you?

Who inducts you into the organization when you are a

new employee?
Whom do you contact when you have any doubts
regarding your pay package, perks, benefits, conveyance,
leave management etc.?
Who helps you in the final exit formalities when you leave
an organization?

Who takes care of your training and development needs?

Introduction
You must have guessed correctly. It is
the Human Resource Managers and
people from the HR Department who
take care of you right from the time
when you apply to a company, you get
the job, you join the company, are
working with the company till the time
you leave the company.
Hence, in your entire lifecycle of
involvement with the company, the HR
always stands by you and supports you
during your tenure with the company.
Hence, HR managers are also known
as People Managers, People
Enablers and they practice as
Human Resource or People
Management.

What is Human Resource

Management (HRM)?
It is a science because
of the precision and
rigorous application of
theory that is required.
Human Resource
Management (HRM) is an
art and science.

HRM is art of managing

people by using creative
and innovative approaches.

HRM - Definition
Edwin
FlippodefinesHRM as planning,
organizing, directing,
controlling of
procurement,
development,
compensation,
integration ,
maintenance and
separation of human
resources to the end

A rich man purchased a healthy cow and poor man

purchased sick cow from the same market.
The rich man displayed his cow at the entrance to
his house, while poor man invested a lot of money
and efforts on his sick cow. In course of time, the
rich mans cow become weak, while poors man cow
gained health.
People are the most vital and valuable resource of
any organization. Material resources depreciate,
while Human Resources are appreciate

LOG
The Mantra : Understand
and Nurture People
O

What is Human Resource

Management
(HRM)?
HRM
is all about people
in organizations. No wonder
that some MNCs (Multinationals) call the HR
managers as People Managers, People Enablers and
the practice as People Management. In the 21st
century organizations, the HR manager or the people
manager is no longer seen as someone who takes
care of the activities described in the traditional way.
In fact, most organizations have different
departments dealing with Staffing, Payroll, and
Retention etc. Instead, the HR manager is
responsible for managing employee expectations vis-vis the management objectives and reconciling
both to ensure employee fulfillment and realization of
management objectives.

Some employers with good HR

practices

YOUR COMPANY NAME or YOUR SITE ADDRESS

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Infosys
Treats its employees as its key asset
High level of senior management commitment:
Communicates & share information with employees on regular
basis
Stand in lunch queue as everyone else
Play active role in employees events
No hierarchy & everyone is equal
Take input from employee before taking decision
Dynamic recruitment process
Interviews with HR manager, Potential supervisor, Supervisors
manager, Potential peers & Skill assessment
Employees referrals
Social events are organized regularly where employee & their
family both participate
Petit infoscion is held in which employee's children get an
opportunity to visit parents workplace
Companys stocks are given to its employees
Every employee receives avg. of 47 hrs of training per year
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P & G (India)
Has strong Concern for people
Accommodation is provided as per the number of family members of
the employee and marital status of employee and not based on the
seniority
Health facility
Unlimited medical coverage
Education on health management
First aid workshop
Stress reduction workshop
Newsletter on health
Subsidized health club facility
Relocation : Many of the P & G (India) are relocated in Singapore for
this :
Education about new location is given
For next 2 years company will take care of any education, training or job
of spouse of employee
Flexi time working, telecommuting, job sharing, reduced hours of
work, etc are in place
Dedicated data base which collects employees suggestions about
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anything

Hewlett-Packard Company (HP)

No one breathes down your neck
Flexi time, telecommuting & reduced hour employment in
place
Personal need based leaves besides statuary leaves are
there
10 days for getting married
10 days for preparing for competitive exams
8 weeks for legal adoption of a child
5 days for a employee who has suffered demise in family
5 days for a new father
Sound of success is the HP tune which is played at
employees Bday or at other achievement occasions in the
entire building
Annual family party
On Special day employee can take his family out for
dinner at companys cost once a year (eg BDay)
Employees importance - Any important decision is
communicated to employees couple of hour before media
release
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Cont.
All employees are eligible for stocks
Employees are encouraged to develop themselves by
training & tuition
Common lunch room for all
Annual picnic is organised
Clubs like presidents club & regional club are there and
top performers are given membership to them
Communication is given due importance every employee
gets update of company each morning along with CEOs
message (if any)

9/10/16

13

Balmer Lawrie & Co. Ltd.

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ICICI Bank
Internal portal is ICICI universe
Recruitment through employee referrals is
preferred
Welfare Activities such as:
Company takes care of employee wards admission
into a school
Holiday homes
Flexi hours are used sometimes
Camera linked crche
Saturday Kids club employees kids are
brought to workplace and there is a special
instructor for learn through fun
Wise guy is knowledge management portal
which is accessible to all the employees
Recognition is integral part of culture
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Hughes Communications India Ltd. (HCIL)

HCIL is the largest satellite service operator in India providing a comprehensive
range of broadband networking technologies, solutions, and services for businesses
and governments, including Managed Services to meet every communications
challenge.
It has 8 week induction program named oasis
Stocks are given to employees

Pay revision in six months

Loyalty awards

On completion of one year watch

On completion of five year paid holiday

Regular parties and celebration of festivals

Inter industry competition b/w welfare activities
Popular awards like

Best trouble shooter

Best mentor
Best leader

Regular health checkup camps

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Misc. Examples
TCS

ICICI

Offers choice of working in over 170 offices across 40 countries.

Provisions of Paternity leave for adoption of a girl child

Identifies potential talented staff and offer alternative stock

option and quicker promotion

WIPRO

It has Wings Within program where existing employees get

chance to quit their current job role and join a different department
within organization

Mahindra
and
Mahindra
Co.

Carry Practice called Reverse Mentoring where young people

are given opportunity of mentoring their seniors

Mahindra
and
Microsoft
India
Mahindra
Co.

Offers excellent sporting and wellness facilities.

Employees are allowed to choose a flexible working schedule.
Human Resource Management

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Skills of HR Professionals
The various skills of HR professionals are as follows:

HR
Sk
il

ls

De
c
Ma ision
kin
Sk
g
ills

Let us look at each in detail.

Tec
hn
Sk ical
ills

Le
ad
ers
Sk
h
ills ip

Skills of HR Professionals

HR Skills:
HR managers are required to know how people
play a role in the organization, an advantage
against the competition as well as the policies,
programs etc. Todays HR professional must
be skilled at communicating, negotiating and
team development.

Skills of HR Professionals

Decision Making Skills:

HR managers should take a variety of
decisions that affect whether employees are
qualified and motivated and whether the
organization is operating efficiently and
complying with the law. This requires
knowledge of the organizations line of
business and decisions must take into account
social and ethical implication of the
alternatives.

Skills of HR Professionals

Technical Skills:
These skills are specialized skills. In HRM,
professionals need knowledge of state-of-theart practices in such areas as staffing,
development, rewards, organizational design
etc.

Skills of HR Professionals

Leadership Skills:
HR managers need to play a leadership role
with regard to the organizations HR. In
todays environment, leadership often requires
helping the organization manage change. HR
professional must oversee the changes taking
place to make it a success.

Objective of Human Resource

TheManagement
objective of HRM covers but is not limited to the following
functions:
Training and Development

Industrial Relations

Improve Job
satisfaction

Grievance
Handling

Promote team spirit

HR planning

Hiring
(Recruitment and
Selection)
Develop
loyalty and
commitment

Payroll Management

nt Management and Development

Rewards and
Recognitions

Employee and Labor

Relations

Worker Protection

Therefore, HRM is about developing and managing

harmonious relationships at workplace and striking a balance

Major Objectives of HRM

Scope of Human Resource

Management
The scope of HRM is
extensive and far-reaching.
Therefore, it is very difficult
to define it concisely.
However, we can classify the
scope of HRM under the
following three categories:

HRM in
Personnel
Management
HRM in
Employee
Welfare
HRM in
Industrial
Relations

Lets look at each in detail.

Scope of Human Resource

Human resources are undoubtedly the key resources
in Management
an organization, the easiest and the most difficult
to manage. The objectives of the HRM span right
from the manpower needs assessment to
management and retention of the same. To fulfill this
purpose, Human Resource Management is
responsible for effective designing and
implementation of various policies, procedures and
programs. It is all about developing and managing
knowledge, skills, creativity, aptitude and talent and
using them optimally.
Human Resource Management is not just limited to
manage and optimally exploit human intellect. It also
focuses on managing physical and emotional capital
of employees. Thus, the scope of HRM is widening
with every passing day, considering the complexity

Personnel
Aspect

SCOPE
SCOPE
of
of
HRM
HRM

Welfare
Aspect

Industrial
Relation
Aspect

Manpower planning
Recruitment
Selection
Placement
Transfer
Promotion
Training and development
Retrenchment
Remuneration

Working Condition
Basic amenities-:
Canteens
Rest and lunch hours
Housing
Transportation
Health and safety
Medical Assistance

Union Management relation

Collective bargaining
Grievances
Disciplinary Approach
Settlement of Disputes

Human Resource Management

Scope of Human Resource

Management
HRM in Personnel Management:
HRM in Personnel Management is typically
direct manpower management that involves

Manpower planning
Hiring (recruitment and selection)
Training and development
Induction and orientation
Transfer, promotion
Employee productivity
Compensation
Layoff and retrenchment

The overall objective here is to ascertain individual growth,

development and effectiveness which contribute to organizational
development.
It also includes performance appraisal, developing new skills,
disbursement of wages, incentives, allowances, travelling policies and
procedures and other related courses of actions.

Scope of Human Resource

HRMManagement
in Employee Welfare
HRM in Employee Welfare is a particular aspect
of HRM which deals with working conditions and
amenities at workplace. This includes a wide
array of responsibilities and services such as
safety services,
health services,
welfare funds
social security
medical services.
It also covers appointment of safety officers, making the environment
worth working, eliminating workplace hazards, support by top
management, job safety, safeguarding machinery, cleanliness, proper
ventilation and lighting, medical care, sickness benefits, employee injury
benefits, personal injury benefits, maternity benefits, unemployment
benefits and family benefits.
It also relates to supervision, employee counselling,
establishing harmonious relationships with employees,
education and training. Employee welfare is about determining
employees real needs and fulfilling them with active
participation of both management and employees. In addition

Scope of Human Resource

HRMManagement
in Industrial Relations

HRM in Industrial Relations is a highly

sensitive area. It needs careful interactions
with labor or employee unions, addressing
their
grievances
settling
It
is the
art andand
science
ofthe disputes
effectively in order
toemployment
maintain peace
and
understanding
the
(unionharmony in the organization.
management)
relations, joint
consultation, disciplinary procedures,
solving problems with mutual efforts,
understanding human behavior and
maintaining work relations, collective
bargaining and settlement of disputes.
The main aim is to safeguard the
interest of employees by securing the
highest level of understanding to the
extent that does not leave a negative
impact on organization. It is about
establishing, growing and promoting
industrial democracy to safeguard the

Functions of HR
MANAGERIAL
FUNCTIONS
Planning
Organizing
Directing
Controlling

OF
HUMAN
RESOURSE

OPERATIVE
FUNCTIONS
Procurement
Human Resource
Development
Compensation
Management
Employee relation
Maintenance
Emerging issue

Operative Function OF HRM

PROCUREMENT

Job analysis

HUMAN
RESOURSE
DEVELOPMENT

Training and
development

COMPENSATION
and MOTIVATION
MANAGEMENT

Job design

Job evaluation
Work
scheduling

Human
Resource
Planning

Career
planning

Organization
changes

Recruitment

Selection
Induction

Organization
development

Placement
Internal
Mobility

EMPLOYEE
RELATION

Grievance
redressal

Health and
Safety

Personal
records

Discipline

HR Audit

Collective
bargaining

Security
measures

HR Research

Welfare
schemes

HR
Accounting

Human
Resource
Information
System

Stress
Counseling

International
HRM

Motivation
Performance
appraisal
Wages &
salary

Trade unions

Participative
management

Teams and
teamwork

administration

Fringe benefits

EMERGING
ISSUES

MAINTAINACE

Industrial
Relation

Difference between Personnel

Management
& HRM
Personnel Management
is essentially workforce centered
whereas Human Resource Management is resource
centered.

Personnel
Management

Human Resource
Management

Let us understand the various differences between Personnel

Management and Human Resource Management.

Personnel Management:

Difference between Personnel

Traditionally
the term personnel
Management
& HRM
management was used to refer to the
set of activities concerning the
workforce which included staffing,
payroll, contractual obligations and
other administrative tasks. In this
respect, personnel management
encompasses the range of activities
that are to do with managing the
workforce rather than resources.
Personnel Management is more
administrative in nature. The Personnel
Managers main job is to ensure that
the needs of the workforce as they
pertain to their immediate concerns
are taken care of. Further, personnel
managers typically played the role of
mediators between the management
and the employees and hence there

Human Resource Management:

Difference between Personnel

With the advent of resource centric
Management & HRM

organizations in recent decades, it has

become imperative to put people first
as well as secure management
objectives of maximizing the ROI
(Return on Investment) on the
resources. This has led to the
development of the modern HRM
function which is primarily concerned
with ensuring the fulfillment of
management objectives and at the
same time ensuring that the needs of
the resources are taken care of. In this
way, HRM differs from personnel
management not only in its broader
scope but also in the way in which its
mission is defined. HRM goes beyond
the administrative tasks of personnel
management and encompasses a broad

Difference between HRM and Personnel

Management
Personnel

HRM

Meaning

It means management of people

employed

It means management of employee

skills,abilities,knowledge,talent etc.

treatment

Employees are treated as

economic man his services are
exchanged for wages and salary

Employees are treated as valuable

assets

Cost/ profit

It is cost centered therefore

management tries to control the
cost

It is a profit centered therefore

investment in human resources for
future utility purpose

benefits

Employees are used for

organizational benefits

Employees are used for mutual

benefits

Psychological
contract

Compliance occur in the

behaviors of employees

Employees are more committed

Structure and
systems

Bureaucratic , centralized ,
Formal

Organized , developed , flexible

Roles

Specialist / Professional

Largely integrated in management

Human Resource Management

CHALLENGES FACED BY HRM

Human Resource Management

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Evolution of Human
LOG
Resource O
Management

LOGO

 Period before industrial revolution

The society was primarily an
agriculture economy with limited
production. Number of specialized
crafts was limited and was usually
carried out within a village or
community with apprentices assisting
the master craftsmen. Communication
channel were limited.

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 Period of industrial revolution (1750 to 1850) Industrial

revolution marked the conversion of economy from agriculture
based to industry based. Modernization and increased means if
communication gave way to industrial setup. A department was
set up to look into workers wages, welfare and other related
issues. This led to emergence of personnel management with the
major task as

Workers wages and salaries

Workers record maintenance

Workers housing facilities and health care

An important event in industrial revolution was growth of Labour
Union (1790) The works working in the industries or factories
were subjected to long working hours and very less wages. With
growing unrest , workers across the world started protest and
this led to the establishment of Labour unions. To deal with
labour issues at one end and management at the other Personnel
Management department had to be capable of politics and
diplomacy , thus the industrial relation department emerged.
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 Post Industrial revolution The term Human

resource Management saw a major evolution after
1850. Various studies were released and many
experiments were conducted during this period which
gave HRM altogether a new meaning and importance.
A brief overview of major theories release during this
period is presented below
Frederick W. Taylor gave principles of scientific
management (1857 o 1911) led to the evolution of
scientific human resource management approach
which was involved in

Workers training

Maintaining wage uniformity

Focus on attaining better productivity.

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Cont.
Hawthorne studies, conducted by Elton Mayo & Fritz Roethlisberger
(1927 to 1940). Observations and findings of Hawthrone
experiment shifted the focus of Human resource from increasing
workers productivity to increasing workers efficiency through
greater work satisfaction.
Douglas McGregor Theory X and Theory Y (1960) and Abraham
Maslows Hierarchy of needs ( 1954) These studies and
observations led to the transition from the administrative and
passive
Personnel Management approach to a more dynamic Human Resourc
e Management approach
which considered workers as a valuable resource.
As a result of these principles and studies , Human resource
management became increasingly line management function , linked
to core business operations. Some of the major activities of HR
department are listed asRecruitment and selection of skilled workforce.
Motivation and employee benefits
Training and development of workforce
Performance related salaries and appraisals.
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Strategic Human Resource Management

Approach
With increase in technology and knowledge
base industries and as a result of global
competition , Human Resource Management
is assuming more critical role today . Its
major accomplishment is aligning individual
goals and objectives with corporate goals
and objectives. Strategic HRM focuses on
actions that differentiate the organization
from its competitors and aims to make long
term impact on the success of organization.
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Indian HR Practices

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Staffing Practices
Resumes seek strong educational background.
Employee referrals (predominantly used for middle and
senior management).
Succession planning (predominantly used for middle and
senior management).
Elaborate employment tests related to the job, especially at
entry level.
Newspaper advertisements are used to brand the company
to potential applicants.
Newspaper advertisements will specify age and gender
requirements.
Personal questions will be asked in interviews/resumes
about:
Age
Marital status
Family plans (women planning to start a family)
Family background
Caste background
Photos to be included
Verification of educational certificates
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Training Practices
Training (future orientation):

Education is extremely valued, and training is an

extension of it.
Entry point training programs (3 to12 months of
orientation).
Ongoing training programs.
Development programs (promotions involve
training).
In-house training centers are a common feature
in Indian organizations.
Deductive learning style in training: Known as
top-down approach where learning principles
start with general concepts and move toward
specific application.

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Performance Appraisal
Annual performance appraisals.
Supervisors provide performance ratings that are
frequently inflated due to personal relationships.
Employment at will does not exist in India.
employment termination carries a social stigma.
Employee promotions are frequently based on seniority.

Supervisors and subordinates develop close

relationships.
Organizational loyalty is as important as work
performance.

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Compensation and Benefits

In addition to a base salary, compensation
includes:

House rent allowance (HRA*).

Medical allowance.
Dearness allowance (DA*). It is an allowance provided to adjust the
cost of living and may vary depending on the jobs location (rural vs. urban
areas).
Leave travel allowance (LTA*).
Commuter allowance.
* These allowances are frequently referred by their acronyms

Several categories of leave (vacation) exist:

Sick leave: 7 days (medical certificate required).

Casual leave: 7 days (for personal and family emergencies,
requires prior permission of boss). Employees can take
maximum 2 days at a time
Annual leave: 3 weeks (after one year of employment).
National holidays: About 20 days.
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Compensation and Benefits

Retirement age:

55-60 years (private sector);.

60 years (public sector).

Retirement Benefits: Employees receive two lump-sum payments when they

retire:
Provident Fund
Typical contributions: 10-12 percent of base salary (employer and employee).
Payable on retirement, voluntary separation, death.

Gratuity
Only employer contributes (15 days salary per year of service).
Tax-exempt for employees.
Payable on retirement, voluntary separation, death.

Organizations are seen as an extension of the family.

Provide both short-term and long-term personal loans.

Personal loans for housing, car, home maintenance and family emergencies.

Loan amounts vary by position and level in organization.

All employees after their probation (confirmation) period are eligible.

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Compensation and Benefits

Many medium and large organizations have
cafeterias with subsidized lunch facilities.

Executives receive special benefits to reflect status

such as:

Club memberships.
Overseas training.
Company housing.
Company cars.

Provided with drivers.

International cars.
Operational and maintenance costs.
Phone bill reimbursements.
Organizations provide business and cell phones.

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Indian HR Associations

In the 1940s and early 1950s, two professional HR associations

were established to acknowledge the importance of HR:

Indian Institute of Personnel Management (IIPM).

National Institute of Labor Management (NILM).

In1980, the two associations merged to form the National Institute

of Personnel Management (NIPM).

National Institute of Personnel Management is the premier

all-India Institute of professionals engaged in personnel
management, industrial relations, labour welfare and human
resources development. NIPM is a professional, non-profitmaking society registered under Societies Registration Act,
1960.
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Importance of HRM for Organizational

ThereSuccess
are various reasons for
organizations to have a HRM strategy as
well as the business drivers that make the
strategy imperative for organizational
success.
It is a fact that to thrive in the chaotic and
turbulent business environment, firms
need to constantly innovate and be ahead
of the curve in terms of business
practices and strategies.
It is from this motivation to be at the
top of the pack that HRM becomes a
valuable tool for management to
ensure success.

Importance of HRM for Organizational

Success
The following are the various reasons that organizations need
to give importance to HRM:

The Evolving Business Paradigm

Strategic Management and HRM
Need for Adopting a Holistic
Approach
Let us look at each in detail.

Importance of HRM for Organizational

Success
The Evolving Business Paradigm

One of the factors behind organizations giving a lot of

attention to their people is the nature of the firms in the
current business environment. There has been a steady
movement towards an economy based on services;
hence, it becomes important for firms engaged in the
service sector to keep their employees motivated and
productive. Even in the manufacturing and the
traditional sectors, the need to remain competitive has
meant that firms in these sectors deploy strategies that
make effective use of their resources. This changed
business landscape resulted due to a paradigm shift in
the way businesses and firms view their employees as
more than just resources and instead adopt a people

Importance of HRM for Organizational

Success
Strategic Management and HRM

Moreover, there is a need to align organizational goals

with that of the HR strategy to ensure that there is
alignment of the people policies with that of the
management objectives. This means that the HR
department can no longer be viewed as an appendage of
the firm but instead is a vital organ in ensuring
organizational success. The aims of strategic
management are to provide the organization with a
sense of direction and a feeling of purpose. The current
HRM practices in many industries are taken as seriously

Importance of HRM for Organizational

Success

Need for Adopting a Holistic

Approach

The practice of HRM must be applied to the overall

strategic goals for the organization instead of a
standalone tint that takes a unit based or a micro
approach. The idea here is to adopt a holistic
perspective towards HRM that ensures that there are no
piecemeal strategies and the HRM policy enmeshes itself
fully with those of the organizational goals. The practice
of HRM needs to be integrated with the overall strategy
to ensure effective use of people and provide better
returns to the organizations in terms of ROI (Return on
Investment) for every rupee or dollar spent on them.
Unless the HRM practice is designed in this way, the
firms stand to lose from not utilizing people fully and

Emerging HRM Functions

The following are some of the emerging HRM functions:HR managers

Business
and
Strategic
Partner

Change
Champio
n
HR managers have
to be change
agents, thus
requiring them to
acquire knowledge
about and the
ability to execute
successful change
strategies in the
organization.

Employe
e
Advocat
e

contribute to the
development of
the organization,
realization of
business plans
and achievement
of objectives.

HR managers have
to serve as
advocates of the
employees. It
means that they
have to create a
work environment
in which the
employees are

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