UNDERSTANDING THE NATURE AND SCOPE

OF HRM
 HUMAN RESOURCE MANAGEMENT (HRM)

HRM defined as

HRM is management function concerned with hiring , motivating and

maintaining people in an organization. It focuses on people in organization

HRM includes all major activities in professional life of a worker. All

activities from employee entry to managing performance and training until
he or she leaves

Strategic and coherent approach to the management of an organizations most

valued asset the people working there who individually and collectively
contribute to the achievement of its objectives
 Personnel Management
Personnel management is the planning,
organizing, compensation, integration and
maintenance of people for the purpose of
contributing to organizational, individual and
societal goals.
 HRD

It aims at developing peoples knowledge,

expertise, productivity and satisfaction for the
benefit of the individual and organization in
particular and community and nation as a
whole.
 Human Resource System

1. HR philosophies (values and guiding principles

adopted in managing people)
2. HR strategies (defining the direction)
3. HR policies (how values, principles should be
applied)
4. HR processes ( formal procedures and methods
put HR plans into effect)
5. HR practices ( informal approaches used)
6. HR programmes (which enable strategies, policies,
practices to be implemented)
 Models of HRM

The Michigan School Model:

Congruency with organizational strategy (matching
model)
The Harvard School Model
(Harvard framework)
Integrated parts towards a strategic vision and with a
central philosophy
The Michigan School Model
The human resource cycle
Elements of human resource cycle
1.Selection: matching available human
resources to jobs
2.Appraisal: performance management
3.Rewards: focus on organizational
performance (most under-utilized and
mishandled tool)
short-term and long-term
4.Development developing high quality
employees
The Harvard Framework
Characteristics of HRM in Harvard Framework

1) Line managers accept more responsibility

for ensuring the alignment of competitive
strategy and personnel policy
2) Personnel has the mission of setting
policies that govern how personnel activities
are developed and implemented in ways that
make them more mutually reinforcing
 The Semantics
There two terms

1. PM (Personnel Management )

2. HRM (Human Resource Management )

PM and HRM are different in scope and orientation

HRM is broad concept

PM and HRD (Human Resource Development) are part of HRM

HRM and Personnel Management differences

HRM
places more emphasis on strategic fit and integration,
is based on a management and business oriented
philosophy,
places more emphasis on mutuality, is more holistic,
specialists are more like business partners than
administrators,
treats people as assets and not only costs.
 Differences Between HRM and PM
Dimensions PM HRM
1.Employment contract Careful delineation of written Aim to go behind contract
contracts
2.Rules Importance of devising clear Can do outlook, impatience with
rules rule
3.Guide to management action Procedures Business need
4.Behaviour referent Norms ,customs and practices Values and mission
5.Managerial task vis--vis labor Monitoring Nurturing

6.Speed of decision Slow Fast

7.Management role Transactional Transformational leadership
8.Communication Indirect Direct
9. Prized management skills Negotiation Facilitation

10.Selection Separate ,marginal task Integrated, key task

11.Labour management Collective barraging contracts Individual contracts
12.Job categories and grade Many Few

13.Job design Division of labour Team work

14.Conflict handling Reach temporary truce Manage climate and culture
 Differences Between HRM and PM
Dimensions PM HRM
15.Respect for employees Labour is used as tool which Peoples are used as assets to
is spendable and replaceable be used for the benefit of
organization

16.Shared interest Interest of organizations are Mutuality of interest

uppermost
17.Evolution Precedes HRM Latest in evolution of
subjects
18.Locus of control External Internal
19.Oganization principles Mechanistic Organic
Top down Bottom-up
centralized Decentralized

20.Key relations Labour Management Customers

21.Initiatives Piecemeal Integrated
22.Pay Job evaluation Performance related
23.Training and development Controlled accessed to Learning companies
courses
 SCOPE OF HRM
Industrial Relations
Personnel Aspect Welfare Aspect
Aspect
Manpower Working Union-
Planning Conditions & Management
Recruitment Amenities- Relations
Selection canteens, Day- Joint Consultation
Care, Rest- Collective
Transfer
Rooms, transport, Bargaining
Promotion housing, Medical
T&D Grievance
Assistance,
Rewards Education, Disciplinary
Health& Safety, procedures
Recreation Settlement of
Disputes
HRM Activities

HR Planning

Job Analysis and Design

Recruitment and Selection

Training and Development

Remuneration

Welfare

Safe and Healthy Work Environment

Industrial relations
 Acquisition

Fairness Training

Human
Resource
Management
Health and Safety (HRM) Appraisal

Labor Relations Compensation

 HRM Functions and Objectives

The main objective of HRM is to ensure the availability of willing

and competent force to an organization

There are other objective of HRM too

1. Societal objectives

2. Functional objectives

3. Organizational objectives

4. Personal objectives
HRM FUNCTIONS AND OBJECTIVES

Societal Objectives

Organizational
Objectives

Functional
Objectives

Personal
Objectives

Source: Aswathappa, 2008, p.8

 HRM Functions and Objectives

1 Societal objectives

Societal objectives of HRM make sure that the organization is

socially and ethically responsible

Minimizing negative impact of societal demands on organizations

For example: making organizations ethical in recruitment, to

minimize the discrimination against hiring based on ethnicity,
race, and religion etc.
 HRM Functions and Objectives

2. Organizational objectives

To determine the role of HRM in organizational effectiveness

Its purpose is to assist/serve organization

HR department also serve other departments

 HRM Functions and Objectives

3. Functional objectives

To maintain department contribution in organizational

effectiveness

HR department services must fit into the organizational needs

 HRM Functions and Objectives
4 Personal objectives

To assist employees in achieving their personal/individual goals

Maximum contribution to organization

Personal objectives are achieved when employees are satisfied,

motivated and retained

Satisfied employees excellent services excellent

organizational performance
 HRM Functions and Objectives

HRM Objectives Supporting Functions

Societal Objectives Legal compliance
Benefits
Union-Management relationship

Organizational Objectives Human Resource Planning

Employee Relations
Training and Development
Performance Appraisal
Placement

Functional Objectives Performance Appraisal

Placement

Personal Objectives Compensation

Training and Development
Performance Appraisal
Placement
 Organization Of HR Department
Two issues
HR department placement in overall setup.

Composition of HR department
Structure of HR

Structure of organization depend on whether organization

is small or large
In small organization there is no need to have separate
department to deal with activities relating to people
Many small organizations even do not have personnel
managers
Outsourcing to firms specializing in managing accounts,
pensions, funds and health & care.
 Organization Of HR Department

Earlier, in personnel department employee with little knowledge

and competencies were placed

The responsibility was to arrange tours, picnics, and

retirement/farewell parties

Now focus has changed, HR department has key place in

overall organizations.

Contrary to small-sized company, in large scale organization

there is big department heading by Manager/Director.
 Organization Of HR Department

HR in Small Scale Unit

Owner

Production Marketing Accounts Office

Manager Managers Manager Manager

Personnel
Assistant
 Organization Of HR Department

HRM in large scale organization

Chairman

Director Director Director Director

Production Finance R&D HRM

Deputy Deputy Deputy

Director Director Director
Recruitment Training Promotions
Composition Of HR and Personnel Department

Director HRM

Director
Manager Manager
Manager IR
Manager
HRM
Personnel HRD Administration

HR
Hiring Complaints Compensation PR Canteen
Planning

Welfare Transport Legal

Aims of HRM
1. Organizational effectiveness (HRM makes a significant impact
on firm performance)
2. Human capital management (HC is the prime asset the aim is
to develop the inherent capacities of people)
3. Knowledge management (support the development of firm-
specific knowledge)
4. Reward management (enhance motivation, job engagement)
5. Employee relations (harmonious relationship between partners)
6. Meeting diverse needs (stakeholders, workforce)
7. Bridging the gap between rhetoric and reality (HRM is to bridge
the gap and to ensure that aspirations are translated to
effective action
 Outsourcing HR Activities
Outsourcing or Subcontracting: Transfer activities to specialist
organizations

Reasons

Restructuring

Downsizing

Growth in business

Decline in business

Benefits

Cost efficiency

Access to expertise
HRD in the organizational context is a process by
which the employees of an organization are
helped in a continuous, planned way to:
(a) acquire or sharpen capabilities required to
perform various functions associated with their
present or expected future roles;
(b) develop their general capabilities
as individuals and discover and exploit their own
inner potentials for their own and/or
organizational development processes; and
(c) develop an organizational culture in which
supervisor-subordinate relationships, team work
and collaboration among sub units are strong
and contribute to the professional well-being,
motivation and pride of employees