Human Resource Management

Chapter -1 Introduction To Human Resource

Management
Gary Dessler , Biju Varkkey.

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Organization
An organization consists of people with formally assigned
roles who work together to achieve the organization’s goals.
Manager
A manager is the person responsible for accomplishing the
organization’s goals, and who does so by managing the efforts
of the organization’s people.
Management process: Most experts agree that managing
involves five functions: planning. Organizing, staffing, leading,
and controlling. In total, these functions represent the
management process. Some of the specific activities involved
in each function include:

•Planning. Establishing goals and standards; developing

rules and procedures; developing plans and forecasting.
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• Organizing. Giving each subordinate a specific task; establishing
departments delegating authority to subordinates; establishing
channels of authority and communication; coordinating
subordinates’ work.
• Staffing. Determining what type of people you should hire;
recruiting prospective employees; selecting employees; training
and developing employees: setting performance standards;
evaluating performance; counseling employees: compensating
employees.
• Leading. Getting others to get the job done; maintaining morale;
motivating subordinates.

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Controlling. Setting standards such as sales quotas, quality
standards, or production levels; checking to see how actual
performance compares with these standards; taking corrective
action, as needed.
In this book, we are going to focus on one of these functions the
staffing, Personnel management, or human resource
management (HRM) function.
Fig The Management Process

Planning

Controlling Organizing

Leading Staffing
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Human resource management At Work:
• We are now going to focus on one of these functions- the staffing,
personnel management, or human resource management (HRM)
function.
• What is Human Resource Management (HRM)?
-- Human resource management is the process of acquiring,
training, appraising, and compensating employees, and of
attending to their labor relations, health and safety, and fairness
concerns. (Dessler & Varkky, 2011)
-- It is the people or personnel aspect of a manager’s job.
— HRM is comprised of the staffing, development, motivation, and
maintenance functions (DeCenzo & Robbins, 2005).
— HRM is the set of organizational activities directed at attracting,
developing, and maintaining an effective workforce (DeNisi &
Griffin, 2008).

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— HRM is the policies and practices involved in carrying out the
“people” or human resource aspects of a management position,
including recruiting, screening, training, rewarding, and
appraising (Dessler & Varkkey, 2009).
Human Resource Management at Work.

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Personnel Aspects of a Manager’s Job
i. Conducting job analyses
ii. Planning labor needs and recruiting job candidates
iii. Selecting job candidates
iv. Orienting and training new employees
v. Managing wages and salaries
vi. Providing incentives and benefits
vii. Appraising performance
viii. Communicating
ix. Training and developing managers
x. Building employee commitment

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Personnel Mistakes
i. Hire the wrong person for the job
ii. Experience high turnover
iii. Have your people not doing their best
iv. Waste time with useless interviews
v. Have your firm in court because of discriminatory actions
vi. Have your firm cited by OSHA for unsafe practices
vii. Have some employees think their salaries are unfair and
inequitable relative to others in the organization
viii. Allow a lack of training to undermine your department’s
effectiveness
ix. Commit any unfair labor practices
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 Line and Staff Aspects of HRM
All managers are in a sense HR managers, because they all
get involved in activities like recruiting, interviewing,
selecting and training. Yet most firms also have HR
departments with their own top managers.
Authority: Authority is the right to make decisions, to direct
the work of others and to give orders.
Line Authority: Line authority gives managers the right
(or authority) to issue orders to other managers or
employees. It creates a superior- subordinate
relationship.
Staff Authority: staff authority gives the managers the right
(or authority) to advice other managers or employees. It
creates an advisory relationship.
Line Manager:
A manager who is authorized to direct the (has line authority)
work of subordinates and is responsible for
accomplishing the organization’s tasks.

Staff Manager:
— A manager who assists and advises line managers.
— Run departments that are advisory or supportive (HRM, OC)
— Can advise
HR managers are usually staff manager. They assist and advise
line managers in areas like recruiting hiring and
compensation However, line managers still have human
resource duties.
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Line Managers’ HRM Responsibilities
1. Placing the right person on the right job
2. Starting new employees in the organization (orientation)
3. Training employees for jobs that are new to them
4. Improving the job performance of each person
5. Gaining creative cooperation and developing smooth
working relationships
6. Interpreting the firm’s policies and procedures
7. Controlling labor costs
8. Developing the abilities of each person
9. Creating and maintaining department morale
10.Protecting employees’ health and physical condition
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 Human Resource Managers’ Duties
In providing this specialized assistance, the human resource
manager carries out three distinct functions:
1. A line Function Functions
of
2. A coordinative function HR
3. Staff (assist and advice) Managers
functions
Staff
Line Function Coordinative
Functions
Line Authority Function
Staff Authority
Implied Functional
Innovator/Advoc
Authority Authority
acy

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Human Resource Manager’s Duties
In providing this specialized assistance, the human resource
manager carries out three distinct functions:
1. A line function. The human resource manager directs the
activities of the people in his or her own department, and
perhaps in related areas (like the plant cafeteria).
2. A coordinative function. The human resource manager also
coordinates personnel activities, a duty often referred to as
functional authority (or functional control). Here he or she
ensures that line managers are implementing the firm’s
human resource policies and practices (for example,
adhering to its sexual harassment policies).

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3.Staff (assist and advise) functions. Assisting and advising line
managers is the heart of the human resource manager’s job.
• He or she advises the CEO so the CEO can better understand the
personnel aspects of the company’s strategic options.
• HR managers assists in hiring, training, evaluating, rewarding,
counseling, promoting, and firing employees.
• It administers the various benefit programs (health and accident
insurance, retirement, vacation, and so on).
• It helps line managers comply with equal employment and
occupational safety laws, and plays an important role in handling
grievances and labor relations.
• It carries out an innovator role, by providing up-to-date
information on current trends and new methods for better
utilizing the company’s employees (or “human resources”).
• It plays an employee advocacy role, by representing the interests
of employees within the framework of its primary obligation to
senior management.
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Human Resource Organization Chart.

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HR Organization Chart for Small firm

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Human Resource Management specialties

Recruiter

Labor relations
specialist EEO coordinator
Human
Resource
Specialties
Training specialist Job analyst

Compensation
manager

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Examples of human resource management specialties include:
• Recruiters. Search for qualified job applicants.
•Human resource development (HRD) specialists. Manage employee
development activities in an integrated manner
• Engagement and fun specialists. Ensure that the workplace is fun-filled
and enjoyable.
• Employee welfare officer. Take care of welfare amenities for employees
prescribed by law (for example, the Factories Act, 1948) or otherwise.
• Job analysts. Collect and examine information about jobs to prepare
job descriptions.
• Compensation managers. Develop compensation plans and handle
the employee benefits program.
• Training specialists. Plan, organize, and direct training activities.
• Employment/Industrial relations specialists. Advise management
on all aspects of union management relations.

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New Approaches to Organizing HR
Employers are also experimenting with offering human resource services in new
ways. For example,
some employers organize their HR services around four groups:
transactional, corporate, embedded, and centers of expertise.
•The transactional HR group focuses on using centralized call centers and
outsourcing arrangements with vendors (such as benefits advisors) to
provide specialized support in day-to-day transactional HR activities (such as
changing benefits plans and providing updated appraisal forms) to the
company’s employees.
•The corporate HR group focuses on assisting top management in “top level”
big picture issues such as developing the company’s long-term strategic plan.
•The embedded HR unit assigns HR generalists (also known as “relationship
managers” or “HR business partners”) directly to departments like sales and
production, to provide the localized human resource management assistance
the departments need.
•The centers of expertise are like specialized HR consulting firms within the
company for instance, providing specialized assistance in areas such as
organizational change.
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THE TRENDS SHAPING HUMAN RESOURCE ANAGEMENT
Someone always has to staff the organization, so human resource
(or “personnel”) managers have long played important roles.
Working cooperatively with line managers, they’ve helped
administer benefits, screen employees, and recommend appraisal
forms, for instance.
Some trends shaping human resource management practices
are perhaps more subtle. These trends include globalization,
technology, deregulation, debt or “leverage,” changes in
demographics and the nature of work, and economic challenges
(summarized in Figure 1-4). We’ll discuss these trends next.

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*

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Globalization and Competition Trends
Globalization refers to the tendency of firms to extend their
sales, ownership, and or manufacturing to new markets
abroad. Companies expand abroad for several reasons. Sales
expansion is one. Some manufacturers seek new foreign
products and services to sell, and to cut labor costs. For
businesspeople, globalization’s essential characteristic is this:
More globalization means more competition, and more
competition means more pressure to be “world-class” to lower
costs, to make employees more productive, and to do things
better and less expensively.

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Because of this, globalization brings both benefits and
threats. For consumers it means lower prices and higher
quality on practically everything from computers to cars, but
also the prospect of working harder, and perhaps having less
secured jobs. Job offshoring, that is, having employees
abroad do jobs that, say, Nigerians
formerly did, illustrates this threat. Roger et al (2008)
believes that, in the next few years, many employers plan to
offshore even highly skilled jobs such as sales mangers,
general managers, and human resource managers. For
business owners, globalization means potentially millions of
new consumers, but al
so the considerable threat of facing new and powerful global
competitors at home

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 Indebtedness (Leverage) and Deregulation.
Other trends contributed to this economic growth.
Deregulation was one. In many countries, governments
stripped away rules and regulations. In the United States,
and Europe, for instance, the rules that prevented
commercial banks from expanding into new businesses such
as stock brokering were relaxed. Giant, multinational
“financial supermarkets” such as Citibank quickly emerged.
As economies boomed, more businesses and consumers
went deeply into debt. The only way the country could keep
buying more from road than it sold is by borrowing money.
So, much of the boom is built on deb.

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Technological Trends:
Everyone knows that technology changed the nature of almost
everything we do. We use PDAs to communicate with the office,
and plan trips, manage money, and custom- build new computer
online. Similarly, technology changes what businesses do and how
they do it. Technology in the form of internet based
communications enable Dell and Thousands of other employers to
offshore call center jobs to India. The retailer Zara does not need
expensive inventories. Zara operates its own Internet -based
worldwide distribution network, linked to its checkout registers
around the world. When its head quarters in Spain sees a garment
“flying” out of a store, Zara’s Manufacturing system dyes the
required fabric, cuts and manufactures the items, and speeds it to
that store within days . Companies use virtual online communities
to improve efficiency.
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Trends in the Nature of Work :One implication is that technology
has also had a huge impact on how people work, and on the skills
and training today’s workers need.
 High-Tech Jobs More and more traditional factory jobs are going high-tech.
As the U.S. government’s Occupational Outlook Quarterly put it,
“knowledge-intensive high tech manufacturing in such industries as
aerospace, computers, telecommunications, home electronics,
pharmaceuticals, and medical instruments” is replacing factory jobs in steel,
auto, rubber, and textiles.
 Service Jobs: Technology is not the only trend driving the change from
“brawn to brains”. Today over two thirds of the U.S. workforce is employed
in producing and delivering services, not products. Between 2004 and 2014
as observed by Timothy (2003), almost all of the 19 million new jobs added
in the U.S. will be in service, not in goods- producing industries.

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in the United States will be in services not in goods producing
industries. Several things account for this. With global competition
more manufacturing jobs are shifting to low wage countries. There
has also been a dramatic increase in productivity that lets
manufacturers produce more with fewer workers. Just in time
manufacturing techniques link daily manufacturing schedules
more precisely to customer demand, thus squeezing waste out of
the system and reducing inventory needs. As manufacturers
integrate internet based customer ordering with just in time
manufacturing systems, scheduling becomes even more precise.
More manufacturers are collaborating with their suppliers to create
integrated supply chains. The net effect is that manufacturers have
been squeezing slack and inefficiencies out of the entire
production system, enabling companies to produce more
products with fewer employees. So, manufacturing jobs are
down, and service jobs up.

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Benefits of technological applications for HR

• Intranet based employee portals through which employees

can self service HR transactions.

• The availability of centralized call centers staffed with HR

specialists.

• Increased efficiency of HR operations.

• The development of data warehouses of HR

• related information.

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Knowledge Work and Human Capital: In general, the best jobs that
:

remain require more education and more skills. For example,

automation and just –in -time manufacturing mean that even
manufacturing jobs require more reading, mathematics, and
communication skills than before. For managers, this means a
growing emphasis on knowledge workers, and therefore, on human
capital. Human capital refers to the knowledge, education, training,
skills, and expertise of a firm’s workers. Today as management guru
Peter (1998), and James (2002) predicted years ago, “the center of
gravity in employment is moving fast from manual and clerical
workers to knowledge workers”.
SHRM (2008) demonstrates that human resources managers listed
“critical thinking/problem-solving” and “information technology
application” as the two applied skills most likely to increase in
importance over the next five years. In other words, we are living in
a high-tech, competitive world –one that puts a big premium on
building and capitalizing on human capital. This makes human
resource management skills such as recruiting, screening, training,
and paying employees more important to employers.
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Workforce Demographic Trends – The labor force is getting
older and more multi-ethnic. The aging labor force presents
significant changes in terms of potential labor shortages, and
many firms are instituting new policies aimed at encouraging
aging employees to stay, or at re-hiring previously retired
employees. Growing numbers of workers with eldercare
responsibilities and high rates of immigration also present
challenges and opportunities for HR managers.
 Demographic Trends – The U.S. Workforce is becoming older
and more ethnically diverse. Demographic Trends are also
making finding and retaining quality employees more
challenging.
 “Generation Y” – Born between 1977 and 2002, these
employees want fair and direct supervisors and aim to work
faster and better than other workers.

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 Retirees – Organizations must deal with the large number
of people leaving the workforce. In many cases the number
of younger workers entering the workforce is not enough to
fill all of the vacated positions.

 Nontraditional Workers – These workers may hold

multiple jobs and may be contingent or part-time
employees. Technology is facilitating these alternate work
arrangement.

 Workers from Abroad – This is one way that organizations

are trying to overcome the large number of retirees, but
the option is sometimes met with opposition as
unemployment increases.

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Economic Challenges and Trends
All these trends are occurring in a context of challenge and
upheaval. They
have certainly grabbed employers’ attention. After what
the world went through starting in 2007, it is doubtful that the
deregulation, leveraging, and globalization that drove
economic growth for the previous 50 years will continue
unabated. That may mean slower growth for many
countries, perhaps for years. This means challenging times
ahead for employers. The challenging times mean that for
the foreseeable future, and even well after things turn
positive employers will have to be more frugal and creative
in managing their human resources than perhaps they have
been in the past.

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 Important Trends in FIRM
The New Managers: Globalization competition, technology
workforce trends and economic upheaval confront employers
with new challenges In that context they expect and demand that
their HR managers exhibit the competencies required to help the
company address these new challenges proactively. In practice,
this boils down to three things for HR managers.
— They Focus More on Big Picture issues: The first change is that
today’s new HR managers are involved in more “big picture”
issues. They don’t just do transactional things like signing
onboard new employees Employers want them to be the
firms’ internal consultants identifying and institutionahzing
changes that help employees better contribute to the
company s success and helping top management formulate
and execute its long-term plans or strategies.

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-- They Find New Ways to Provide Transactional Services:
The new HR managers must be adept at offering those
traditional “bread and butters’ transactional HR services
in new ways. For example, they use technology to enable
employees to sell-administer benefits plans. (Table 1-2
lists some important ways employers use technology to
support their HRM activities)
--They Have New Proficiencies: Despite employee selection,
training, and compensation HR managers require
broader business knowledge and proficiencies. For
example, to assist top management in formulating
strategies, the HR manager needs to be familiar with
strategic planning, marketing, production, and finance.
Top management & CFOs recognize the critical role HRM
can play in achieving a company’s strategic goals (Figure
1.8).

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TABLE 1-2 Technological Applications for HR
Application Service Providers (ASPS) and technology outsourcing
Web portals
PCs and high-speed access
Streaming desktop video
The mobile Web and wireless net access
E- procurement
internet- and fltWOrk4flOflit01iflg software
Bluetooth
Electronic signatures
Electronic bill presentment and payment
Data warehouses and computerized ad analytical pogroms

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• Strategic HRM: SHRM means formulating and executing HR policies
and practices that produce the employee competencies and
behaviors the company needs to achieve its strategic aim.
• High Performance Work Practices (HPWP) Defined A high
performance work system is a set of human resources management
policies and practices that together produce superior employee
performance.
“High Performance” is used to describe new forms of work
organization, a new human resource management approach, or a set
of practices that have the potential to achieve substantially enhanced
economic performance.
High Performance Work Practices, as the menu of human resources
policies and practices sometimes described as “Innovative” – that
contributes to higher productivity, greater flexibility, and stronger
financial performance of organizations, is also large, diverse,
ambiguous and unsettled.

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High Performance working, refers to flatter, non-hierarchical structure, moving
away from reliance on management control, team- working, autonomous
working , based on high levels of trust, communication and involvement.
Workers are seen as being more highly skilled and having the intellectual
resources to engage in lifelong learning and master new skills and behaviors.

Benefits of a High Performance Work System (HPWS)

i. Generate more job applicants
ii. Screen candidates more effectively
iii. Provide more and better training
iv. Link pay more explicitly to performance
v. Provide a safer work environment
vi. Produce more qualified applicants per position
vii. More employees are hired based on validated
selection tests
viii. Provide more hours of training for new employees
ix. Higher percentages of employees receiving regular
performance appraisals.

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Evidence-based human resource management (p22)
What is evidence-based human resource management? How does evidence-
based human resource management benefit firms?
• Evidence-based human resource management involves using
data, facts, analytics, scientific rigor, critical evaluation, and
critically evaluated research/case studies to support human
resource management proposals, decisions , practices, and
conclusions. Put simply, evidence-based human resource
management is the deliberate use of the best-available
evidence in making decisions about the human resource
management practices you are focusing on.
• Managers should use evidence-based human resource
management because unless managers take a healthy,
skeptical, evidence-based approach to human resources, they
may jump to the wrong managerial conclusions.
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Managing Ethics: (p. 23)
What ethical issues relate to human resource management? Provide
an example to illustrate your answer.
Answer: Ethics means the standards someone uses to decide what
his or her conduct should be. Six of the ten most serious workplace
ethical issues—workplace safety, security of employee records,
employee theft, affirmative action, comparable work, and employee
privacy rights—are human resource management related. HR
managers who hire children younger than 16 or illegal immigrants are
violating ethical standards
HRM-related Ethical Issues
Workplace safety
Security of employee records
Employee theft
Affirmative action
Comparable work
Employee privacy rights

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HR Qualifications: The HR manager’s job becomes more demanding,
HRM is becoming more professionalized. In the U.S., the Society for Human
Resource Management’s (SHRM) professional certification tests the
professional’s knowledge of all aspects of FIRM, including management
practices, staffing, development, compensation, labor relations, and health
and safety. Those who successfully complete all requirements earn the
SPHR (Senior Professional in HR) or PHR (Professional in HR) certificate.
FIRM specialization is popular at business schools at BBNMBA levels. HR
education at the BBNMBA or equivalent level is provided by all B-
Schools/Institute in Bangladesh (for example, IBA-DU, JU, & RU, FBS-DU,
FBA-CU, BIM, etc).

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