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HUMAN RESOURCE

MANAGEMENT

Concept & Macro level


Scenario
INTRODUCTION
 Term ‘Human Resource’ may be defined
as the total knowledge, skills, creative
abilities, talents and aptitudes of an
org’s workforce, as well as the values,
attitudes, approaches and beliefs of the
individuals.
 Flippo defines that HRM is the planning,
organizing, directing and controlling of the
procurement, development,
compensation, integration, maintenance
and reproduction of human resources to
the end that individual, organizational and
societal objectives are accomplished.
 Acc to Ivancevich & Glucck – ‘HRM is
the function performed in organizations
that facilitates the most effective use of
people (employees) to achieve
organizational and individual goals.
 Similar terms – ‘personnel’, people at
work, manpower, staff, employees etc.
Nature of HRM
 PEOPLE ORIENTED: employees and
groups both; their behavior, emotional and
social aspects.
 COMPREHENSIVE FUNCTION: covers
all levels and categories of employees.
Workers, supervisors, managers,
directors. Also all types of organizations in
the world.
 INDIVIDUAL ORIENTED: under hrm all
employees are considered as individuals
to provide services and programmes to
facilitate growth. Concerned with the
development of human resources i.e.
knowledge, capability, skill,
potentialities and attaining and
achieving employee goals.
 CONTINUOUS FUNCTION: acc to
George R Terry – “it cannot be turned on
and off like water from a faucet; it cannot
be practiced only one hour each day or
one day each week; requires constant
alertness and awareness of human
relations and their importance in
everyday operations.
 A STAFF FUNCTION: hrm is
responsibility of all line managers and a
function of all staff managers in an
organization. Hrm manager do not
manufacture or sell goods but contribute
to the growth of an organization by
advising the operating departments on
personnel matters.
 PERVASIVE FUNCTION: hrm is the
central sub-function of an organization
and it permeates all type of functional
management viz. production mgmt,
marketing mgmt and financial mgmt.
 CHALLENGING FUNCTION: due to
dynamic nature of people. Hrm aims at
securing unreserved co-operation from all
employees to attain predetermined goals.
 DEVELOPMENT ORIENTED: Individual
emp goals consists of job satisfaction,
job security, high salary, attractive
fringe benefits, challenging work, pride,
status, recognition, opportunity for
development etc. It’s concerned with
developing potential of employees, so that
max satisfaction from their work gives best
efforts to the org.
Scope of HRM
 Very wide
 IIPM specified the scope of HRM as:

1. Personnel aspect: manpower planning,


recruitment, selection, placement, transfer,
promotion, training & development, lay off
and retrenchment, remuneration,
incentives, productivity etc
2. Welfare aspect: deals with working
conditions and amenities such as
canteens, creches, rest & lunch rooms,
housing, transport, medical assistance,
education, health & safety, recreation
facilities etc
3. Industrial relations aspect: union-mgmt
relations, joint consultation, collective
bargaining, grievance & disciplinary
procedures, settlement of disputes etc.
Objectives of HRM
 Help org reach its goals: achieve the goals
 Employ the skills & abilities of the w/f
efficiently: make people’s strengths
productive, encourage them to be outstanding
 Provide the org with well-trained & well-
motivated emps: to exert max efforts, perf is
proper
 Inc job satisfaction & self-actualization: prompt
& stimulate every emp to reach its potential
through QWL
 Develop & maintain a quality of work life: makes
employment desirable and social
 To communicate HR policies to all emps
 To be ethically & socially responsive to the
needs of the society
Importance Of HRM
 At enterprise level: help in attracting &
retaining best people; manage w/f;
training, develop right attitude, loyalty &
commitment
 At individual level: promote team work;
offer excellent opportunities; work with
commitment
 At society level: pay well and inc standard
of living
 At national level: optimum use of natural,
physical and financial reources in a better
way.
 Stages in Evolution of HRM

Industrial Scientific Paternalistic


Revolution Era Management Era
Era

Behavioral Human Industrial


Science Era Relations Era Psychology
Era

Personnel Welfare Era


Specialists Era
Concept – Evolution of HRM
EVOLUTION OF PERSONNEL MGMT &
HR APPROACH
PM gained popularity in the 1960s, but it’s
origin dates back to around 1800 BC
when the concept of min wage rate was
included in Babylonian Code of
Hammurai.
 Foundation dates back to the era of
Industrial Revolution when large scale
production was taken up as a result of the
invention of steam engine & several
machines and problems were faced by
factory owners in dealing with their
workers.
 Industrial revolution (late 18th & early 19th
century) is characterized by the
development of engineering; chemical;
power driven machines.
 Growth of Trade unionism: rise of factory
system, increased problems faced by
workers formed trade unions to secure
better wages & better conditions of work.
Weapons used were strikes, slowdowns,
walkouts, boycott etc led to Emp
grievance handling systems.
 SCIENTIFIC MANAGEMENT: started in
USA in 1900 as a result of efforts of
Fredrick W Taylor called the father of
Scientific mgmt. There were 2 dimensions
in his theory:
 i. Mechanical – time and motion studies;
standardization tools; differential piece
rate for wages ; and
 ii. Philosophical – science of mgmt based
on scientific investigations.
 PATERNALISTIC ERA: Robert Owen, a
British industrialist, considered to be
father of Personnel Management,
worked for the betterment of workers &
tried to improve their working conditions.

 This is imp for increasing productivity


because the workers are vital machines.
 INDUSTRIAL PSYCHOLOGY: Hugo
Munsterberg: analysis of jobs in terms of
emp’s mental & emotional requirements
& in development of testing devices is
notable.
 Emphasized the use of psychology in the
field of personnel testing, interviewing,
attitude measurement, learning theory,
training, monotony study, safety, job
analysis & human engineering.
 HR ERA: using techniques developed by
psychologists, George Elton Mayo &
William J Dickson of Western Electric Co
conducted some experiments known as
Hawthorne Experiments, in the field of
industrial psychology.
 As a result, during the 1930s a trend
began phrased as ‘being nice to people’.
This trend was eventually termed ‘ the
Human Relations Movement.’
 Imp features of Hawthorne experiments:
i. A business org is basically a social
system.
ii. Emp can be motivated by psychological
& social satisfaction also.
iii. Mgmt must learn to develop co-operative
attitudes and not merely rely on
command.
iv. Productivity is linked with emp
satisfaction.
 BEHAVIORAL SCIENCE ERA: outgrowth of
human relations studies from disciplines like
sociology, anthropology, psychiatry and
psychology.
 Maslow’s Need Hierarchy Theory: there is a
series of needs some lower & some higher;
higher cannot be satisfied if lower remain
unsatisfied; a satisfied need is not a motivator.
 Herzberg’s Two factors theory of Motivation:
there are two separate sets of conditions
responsible for motivation & dissatisfaction of
workers.
 MODERN PERSPECTIVE –
PERSONNEL MGMT: because of
voluntary efforts of the employers, growth
of PM increased in US & UK and created
specialists for personnel activities. In
India, it was an outcome of Govt policies
like in 1931 when Royal Commission on
Labor recommended the abolition of child
labor & appointment of Labor Officers in
industries.
 Scope of PM expanded considerably throughout
the world and new styles of managing HR have
been developed.
 Jobs becoming specialized and complex,
training and development aspects are given
emphasis.
 Thus, in mid 1980s, from personnel mgmt it
came to be called as HUMAN RESOURCE
MANAGEMENT against the works of famous
writers on mgmt like Pascale & Athos & Peters &
Waterman who produced lists of attributes that
they claimed characterized successful
companies.
 INDIAN SCENARIO
 Report of Royal Commission on
Labor(1929-31): recommended the
appointment of Labor Officers to deal
with recruitment & check corrupt practices.
 Appointment of Labor Officers:
functioned as industrial relations officers to
handle grievances.
 Second World War: enlisting labor
support for war effort. Officers entrusted
with handling of welfare & labor
administration.
 Enactment of Industrial Disputes Act(1947):
made adjudication compulsory. Welfare officers
became Ind’l Relations Officers who were hired
with a legal background.
 Enactment of Factories Act(1948): made
obligatory for factories employing 500 or more
workers to appoint welfare officers.
 1960 & after: rapid growth of industry &
consequent demand for skilled and semiskilled
workers led to the govt to enact the Employment
Exchange Act, 1959 to regulate recruitment of
workers and the Apprentice Act, 1961 to regulate
the training of workers to some extent.
 HRM in India began with industrial
discipline for which Personnel Officers
were appointed.
 Later, their roles were converted to that of
a ‘Ind’l Relations Officer’.
 Today, his role is of a ‘Human Resource
Manager’ & works in three areas of Labor
Welfare, Ind’l relations & Personnel
Administration.
 ASTD (American Society for Training &
Development) has developed an HR wheel in
1983, highlighting different functions of HRM.
 Training & Development: Identifying,
assessing and through planned learning –
helping develop the key competencies.
 Org Development: healthy inter & intra
personal relationships & helping groups
initiate & manage change.
 Org/ Job Design: defining how tasks,
authority & systems will be organized &
integrated across org units & individual
jobs.
 HR Planning: determining org’s major HR
needs, strategies & philosophies.
 Selection & Staffing: matching people & their
career needs & capabilities with jobs & career
paths.
 Personnel research & Info systems: personnel
information database.
 Compensation Benefits: fair & consistent.
 Emp Assistance: providing counseling for
personal problem solving.
 Union/ Labor Relations: healthy union/
organizational relations.
MACRO LEVEL – A broad Scenario

 Technological changes
 Economical challenges
 Political factors
 Social factors
 Local & Governmental Issues
 Unions
 Employer’s demands
 Workforce diversity
Technological Changes
 Technology is the process by which inputs from
an org’s environment are transformed into
outputs.
 Technology includes tools, machinery,
equipment, work procedures and emp
knowledge & skills.
 Technological breakthroughs can dramatically
influence an org’s service markets, suppliers,
distributors, competitors, customers, manf
processes, marketing practices & competitive
position.
 New Skills required: urgent need to
upgrade existing emp skills and
knowledge if org wants to survive &
flourish in a competitive world.
 Downsizing: increased automation has
reduced emp head counts everywhere at
every level.
 Collaborative work: hierarchical
distinctions being blurred & more
teamwork is emphasized.
 Telecommuting: relocation of work from
office to the home, usually with computers
and use phones & Internet to transmit
data.
 Internet & Intranet Revolution: have
enabled companies to become more
competitive by cutting costs. Used to
handle training, administration,
performance mgmt & out placement
functions. E-commerce is becoming a
source of upcoming business.
 Change management: Learning
Organization, Managing organizational
change, Change agents – terms
encountered these days; orgs can only
survive if they are proactive to
environmental changes.
 Competence: enhance competencies of
individuals for specific tasks through well
designed training programmes.
 HR professionals are seen as Strategic
Business partners.
 HR Technology: software systems like
HRIS so that professionals can devote
time to other aspects of their
organizational role.
 Corporate Reorganizations: acquisitions &
mergers in last two decades. America
Online’s purchase of Time Warner in 2001
set a record, worth 181.9 billion $.
 Global Competition: global economy,
international competition in goods & services.
 Cyclical Growth: continued automation &
information technology to increase productivity,
requiring fewer workers.
 Increasing diversity in workforce:

Primary: Age, Race, Affection, Physical qualities,


Gender, Ethnicity;
Secondary: Income, Marital Status, Military
experience, Religious beliefs, Geographical
location, Parental status, Education, Work
background.
 Employee expectations: emp influence &
participation at all levels. Flexible work
conditions.
 Organizations as vehicles for reaching
societal goals: adoption of 1964 Civil
rights Act by US Congress – reqd orgs to
deal fairly with women & racial & religious
minorities in hiring, promotion & other
aspects.

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