Human Resource Management

Module-1

Introduction to HRM, Importance scope and

objectives. Evolution. Line and staff aspects of
HRM, Line managers Human Resource duties,
new approaches to organizing HR, Strategic
human Resource Management, Strategic HRM
tools.
 Human Resources
The term human resources may be defined as
the total knowledge, skills, creative abilities,
talents and aptitude of an organization's
workforce as well as the values, attitudes,
approaches and beliefs of the individual
involved in the affairs of the organisation.
• Various terms to represent human resources
are personnel, people at work, manpower,
staff and employees.
 Elements of Human Capital
• Intellectual Capital- specialised knowledge,
skills and expertise , cognitive complexity,
Learning capacity

• Social Capital- Network or relationships,

sociability, trustworthiness

• Emotional Capital-Self confidence, Ambition

and courage, Risk taking ability, Resilience
 Human Resource Management
Edwin Flippo defines Personnel management as
“planning, organizing, directing and
controlling of procurement, development,
compensation, integration , maintenance and
separation of human resources to the end that
individual, organizational and social objectives
are achieved.”
• According to institute of personal
management (U.K), ‘ personnel management
is an integral but distinctive part of
management, concerned with people at work
and their relationships within the enterprise.”
• During and after 1970’s- several changes took place.
• use of term Human resource management instead of
traditional term personnel management.
• Changes-
• Technological change,
• declining importance of trade unionism,
• shift from industrial employment to service sector
employment,
• growing competition,
• deregulation and globalisation of economy
• As a result 3 important roles of human resources
have emerged
• Human resources can be integrated with strategic
business planning and used to reinforce
appropriate culture.
• Human resources are valuable and a source of
competitive advantage
• Human resources can be tapped most effectively
by mutually consistent policies which promote
commitment and foster a willingness in
employees
 Definition of HRM
• According to Dessler, Human resource
Management is the process of acquiring,
training, appraising, and compensating
employees, and attending to their labour
relations, health, safety and fairness
concerns.”
• HRM is a distinctive approach to employment
management which seeks to achieve
competitive advantage through the strategic
deployment of a highly committed and
capable workforce, using an array of cultural,
structural and personnel techniques.”
Storey 1995
• The focus is on managing people within the
organisation.
• It involves the productive use of people in
achieving the:
– Organisation’s strategic business objectives
– The satisfaction of individual employee needs
– Fulfilling the corporate social responsibility
 Difference between HRM and personnel management
Personnel mgmt HRM
Focus Organisational interest Development of individuals

Philosophy Functional area An

approach,policy,attitude,prac
tice
Nature of Staffing function Part and parcel of every line
Function function
Pervasiveness concern of personnel managers Concern of all managers

Motivation Primarily concerned with Concentrates more on

recruitment,selection,appraisal motivation ,morale boosting,
job satisfaction

Team work Orderly way of administration of Team building

personnel policies and programs
Techniques Pressure tactics and coercive Team building,mutual
forces understanding and
 Differences Between HRM And
Personnel
Management
• Both human resource management (HRM)
and personnel management focus on people
management
• Differences
– Nature of the relations
– Relation of power and management
– Leadership and management role
– Contract of the employment
 Nature of the relations
• In personnel • HRM through a shared
management, the focus is vision between
more on individualistic management and staff
where individual interest create a corporate vision
is more than group and mission which are
interest. linked to business goals
and the fulfilment of
• The relationship between mutual interest where the
management and organization’s needs are
employees are merely on satisfied by employees
contractual basis where and employees‘ needs
one hires and the others are well-taken care by the
perform organization.
 Relation of power and management
• The distribution of • Decentralization of
power in personnel power where the power
management is between top
centralized where the management is shared
top management has with middle and lower
full authority in management groups.
decision-making • This is known as
"empowerment"
 Leadership and management role
• In PM leadership style is • In HRM leaders are
transactional. transformational.
• The leader is merely a • This leadership style
task-oriented person. encourages business
• This leader focuses objectives to be shared
more on procedures by both employees and
that must be followed management.
ahead of human factors
such as personal
bonding, interpersonal
relationship, trust,
understanding,
tolerance and care.
 Contract of the employment
• HRM, does not focus on
• In PM, employees onetime life-long
contract of employment contract where working
is clearly written and hours and other terms
employees must and conditions of
observe strictly the employment are seen
agreed employment as less rigid.
contract. • The new "flexible
• The contract is so rigid approach“ encourages
that there is no scope employees to choose
for further various ways to keep
modifications. contributing their skills
and knowledge to the
organization.
 Respect for employees
• Labour is treated as a • People are treated as
tool which is assets to be used for
expandable and the benefit of the
replaced organization
 Nature of HRM
• Inherent part of management
• Pervasive function of management
• Basic to all functional areas
• People centered –blue collar, white collar,
managerial and non managerial ,professional
and non professional
• Continuous process
• Based on human relations
 Importance of HRM
• HRM helps an organisation and its people to
realize their respective goals at the following
levels
– Organisational level
– Employee level
– Societal level
– National level
• Organisational level:
– Attracting and retaining best talent
– Helps in training people for challenging roles,
promoting team spirit among employees, develop
loyalty and commitment through appropriate
reward schemes
• Employee level:
– Provides growth opportunities to people
– Allows people to work with commitment
• Society level:
– More and more employment opportunities
– Scarce talents are put to best use.
– Productivity gains
• National level:
– Effective use of Human resources helps a nation to
get ahead and compete with the best in the world
leading to better standards of living and better
employment.
 Features of HRM
• It is concerned mostly with managing human resources
• Its concerned with the development of human resources.
• It is concerned with the employees both as individuals and
as a group in attaining goals
• It covers all levels of employees
• It applies to all types of organisation in the world.
• It aims at attaining the goals of the organisation, individual
and society in an integrated approach.
• It is a continuous process
• It is the central sub function of an organization
• It is a challenging job due to the dynamic nature of people.
HRM Objectives
Societal
objectives

Organizational
objectives

Functional
objectives

Personal
objectives
• The societal objectives of HRM seek to ensure
that the organization becomes socially
responsive.
• Societal objectives
• Legal compliance
• Benefits
• Union management relations
• Organizational objectives make sure that HRM is
not a standalone department but rather a means
to assist the organization reach its primary
objectives.
• Organizational objectives
– Human resource planning
– Employee relations
– Selection
– Training and development
– Appraisal
– Placement
• Functional objectives remind the HRM that it has
only functional value and should not become too
expensive at the cost of the organisation.
• Functional objectives
– Appraisal
– Placement
– Assessment
– compensation /rewards
– Recruitment
• Personal objectives assist employees in
achieving their personal goals
• Personal objectives
– Training and development
– Appraisal
– Placement
– Compensation
 General Objectives of HRM
• To provide the organisation with well trained and well motivated
employees
• To attain effective utilization of human resources
• To identify and satisfy individual and organisational needs
• To maintain high employee morale
• To provide training and development
• To provide good facilities and conditions for work
• To develop and maintain quality of work life (QWL)
• To be ethically and socially responsible to the needs of society.
• Take care of human relationships-disciplinary procedure,
grievances, issues with trade unions
• Man power planning, recruitment, promotion, career planning,
salary administration, IR
 Specific Objectives of HRM
• Effective utilization of HR
• Maintain organizational structure of relationships
through delegation of duties
• Development of HR
• Providing opportunities for advancement
• Ensuring services and welfare facilities
• Reconciliation of individual and organizational goals
• Satisfy individual needs
• Offering monetary and non monetary benefits
• Achieve and maintain high employee morale
• Ensuring better HR relations
 Scope of HRM
• Man power planning
• Employment function-Recruitment, selection and
placement
• Training and development
• Performance Appraisal
• Motivation
• Remuneration
• Social security and welfare
• Review and audit of personnel policies
 IIPM –scope of PM
• Welfare Aspect
• Personnel Aspect
• Industrial Relations Aspect
 Functions of HRM
• Managerial Functions
• Operative Functions
• Advisory functions
• Managerial functions
–Planning
–Organizing
–Directing
–Controlling
• Planning Includes defining goals, establishing strategy,
and developing plans to coordinate activities.
• Organizing involves what tasks are to be done, who is
to do them, how the tasks are grouped, who reports to
whom and where decisions are to be done
• Directing involves motivating employees, directing
others, influencing, guiding, supervising ,inspiring the
human resource to work enthusiastically.
• Controlling involves monitoring activities to ensure
they are being accomplished as planned and correcting
any significant deviations.
• Operative functions- related to the specific
activities human resource management.
– Procurement functions
– Training & Development functions
– Compensating functions
– Maintenance
– Motivation
– Personal records
– Industrial relations
– Separation
 Procurement function
• It is concerned with the obtaining of a proper
kind and number of personnel necessary to
accomplish an organizational task
• It deals with
– Manpower requirements
– Recruitment
– Selection
– Placement
– Induction
– Separation
 Development functions
• Its concerned with the personal development
of employees by increasing their skills through
training
• It deals with various techniques like
– on the job training
– Holding seminars and conferences
– Providing educational and vocational counselling
– apprising employee potential
 Compensating functions
• Its concerned with securing adequate and
equitable remuneration to personnel for their
contribution to the attainment of
organizational objectives
• It includes
– Rewards and remuneration
– Job analysis
– Job evaluation
– Fringe benefits
 Maintenance(working conditions
and welfare)
• Working conditions influence the motivation
and morale of employees
• It includes
– Provisions for providing good working conditions
– Cafeteria, restrooms, group insurance, education
for the children of employees, recreational
facilities etc.
 Motivation
• HR managers helps various departmental
mangers to design a system of financial and
non-financial rewards to motivate the
employees
 Personnel Records
• HR department maintains the records of
employees working in the organisation.
• Various records involving personnel records,
training records, achievement , transfer,
promotion etc
 Industrial Relations
• It deals with the study of relations among
employees, employer, government and trade
unions
• It includes
– Trade unions
– Collective bargaining
– Industrial conflicts
– Workers participation in management
 Functions of HRM
• Advisory Role - Human resource Manger
has to offer advise to
– Top management
• Formulation and evaluation of personnel
programmes, policies and procedures
– Departmental heads
• Helps in matters such as manpower planning,
job analysis, recruitment, selection, placement,
training, performance appraisal etc
 Role of a HR Manager
• Policy Formulation
• Advisory Role
• Linking Pin Role
• Representative Role
• Decision making Role
• Mediator Role
• Leadership Role
• Welfare role
• Research Role
• Salary & wage Administration Role
• Time keeping Role
• Maintenance of records
• Grievance handling Role
 The role of personal manager
• Personnel role
• Welfare role
• Clerical role
• Fire fighting role
 Personnel role

• Advisory role
• Man power planning
• Training & development
• Measurement and assessment of individual
and group Behaviour
 Welfare role

• Managing services of canteens, transport,

cooperatives
• Group counselling
• Motivation
• Leadership
• communication
 Clerical role

• Time keeping
• Salary and wage administration
• Maintenance of records
• Incentives
 Fire fighting role

• Grievance handling
• Settlement of disputes
• Handling disciplinary actions
• Collective bargaining
The Human Resource Management
System
 HR In Small Businesses
• Seldom Have a Formal HR Unit
• Other Managers Handle HR Functions
• Focuses on Hiring & Retaining Capable
Employees
The Human Resource Function In A
Small Business
The Human Resource Function In A
Medium-sized Business
Traditional Human Resource Functions
In A Large-sized Firm
• Separate functions are often created
• Placed under an HR Manager
• Each HR function Must have a supervisor and
staff
• HR manager works closely with the top
management in formulating the policies.
THE HUMAN RESOURCE FUNCTIONS
IN A LARGE FIRM
An Example Of A New & Evolving HR
Organization For Large Firms
 Evolution of the concept of HRM
• Commodity Concept- Labour was regarded as
a commodity to be bought and sold

• The factor of production concept - Labour

was treated as any other factor of production

• The Goodwill Concept - Welfare measures like

safety, first aid, lunchroom were introduced
• The Paternalistic concept - Management must
assume a fatherly and protective approach
towards employees

• The Humanitarian Concept - To improve

productivity , social, psychological, physical
needs of the workers must be met
• The Human Resource Concept - Employees
are the most valuable assets of an
organisation

• The Emerging Concept - Employees should be

accepted as partners of the company. Focus is
on Human Resource Development
Line and staff
relationships
and
HRM
• Authority is the right to make decisions, to direct
the work of others and to give orders.
• Line authority and staff authority
• Line Authority-gives managers the right to issue
orders to other managers or employees
• Superior subordinate relationship
• Staff authority-gives the managers the right to
advise other managers or employees.
• Creates an advisory relationship
• Generally cannot issue orders.
• Line relationships: The relationship between two
managers due to delegation of authority and
responsibility or issuing or receiving instructions or
orders is called line relationship
• superior--- subordinate relation
• It refers to those positions which has
– Responsibility
– Authority
– Accountability for accomplishing primary objectives
• Line manager has the power to make final operating
decisions
• Complete responsibility for the results
 Line and staff relationships and HRM
• Staff Relations:- The relationship between two
managers due to giving and taking advices,
guidance, information, help or assistance,
offering suggestions, is called staff relationship
• Staff relations help the line manager s to take
correct decisions quickly.
 Human Resource Management is a
Line
responsibility
• HRM is a line manager’s responsibility but a
staff function.
• The responsibility of line manager is to attain
effective goals of their respective departments
by proper management of materials, machine,
money and MEN(4 M’s).
• Personnel management is a responsibility of
all the line managers.
 Human resource Management is a
Staff
Function
• Line managers need Assistance in Managing
Men
• Personnel managers are created for the
purpose of providing assistance, advice
information etc to the line managers in order
to relieve them from the burden of
management of personnel and allow them to
concentrate on their technical operations
Line and Staff structure
 Line Managers Human Resource
Duties
• Placing the right person on the right job
• Starting new employees in the
organization(orientation)
• Training employees
• Improving the job performance
• Interpreting the companies policies and
procedures
• Controlling labour costs
• Protecting employees 'health and physical
condition
 Human Resource Manager Duties
• A line Function
• A coordinative function
• Staff function(Assist and advise)
 Process of HRM
Step 1 • Employing people of required skills

Acquisition of HR

Step 2 • Employee training

• Career development
Development of HR • Management development

Step 3 • Recognition
• Reward
Motivation of HR • Praise of work

Step 4 • Good working conditions

• Retaining performing workers
Maintenance of HR
• Strategic Role of HRM
• Strategy defines the direction in which an
organisation intends to move and establishes
the framework for action to achieve the
strategic objectives
 SHRM
• Focuses on the linking of all HR activities with
the organisation’s strategic objectives
 Definition
• SHRM has been defined as the process of linking
the HRM with strategic goals and objectives so
as to improve business performance and
develop organizational culture that foster
innovation and flexibility.
(L. Gratton)

• SHRM is defined as the pattern of planned

human resource deployments and activities
intended to enable an organization to achieve
its goals.
Corporate level

Business level

Functional level
The process of Developing strategic
plan
• Determination of Mission or purpose
• Environmental Scanning
• Organisational Analysis
• Developing Strategic alternatives
• Evaluation of strategic alternatives
• Choice of strategy
• Execution of Strategic plans
SWOT Analysis
 ROLE OF SHRM
• Formulation of strategies
• Implementation of strategies
• Building committed work force
• Build two way communication
• Screen out potential employees
• Provide performance based competitive pay
• Provide every opportunities to grow
 Strategic Role of HRM
• Providing Purposeful direction
• Building core competency-in the form of human resources,
marketing capability, technological capability
• Creating competitive advantage-cost leadership ,
differentiation
• Facilitation of change-change agents
• Managing workforce diversity-Increasing aspirations,
Increasing Mobility
• Development of work ethics and culture
• Empowerment of Human Resources
• Total Quality Management
 Linking Company wide and HR
Strategies
Company’s competitive Envt

Company’s strategic plan

Company’s strategic situation

Company’s internal strength

and weaknesses

Company’s HR strategies

Organizational Performance
 HR Strategies
• Leadership of the Organization Strategy
• Talents Strategy
• High Performance strategy
• Strategic Planning
• HRM strategies play an important role in defining and
implementing many of the strategic plans.
• One of the strategic tools used in retaining capital talent is
the employee satisfaction survey.
• Employees are asked their opinions regarding various
policies, amenities, benefits and career development.
Conducting customer interviews is another possible tool to
determine satisfaction.
 High Performance work systems

• Employment security
• Selective hiring
• Extensive training
• Self-managed teams/decentralized decision making
• Reduced status distinctions
• Information sharing
• Contingent (pay-for-performance) rewards
• Transformational leadership
• Measurement of management practices
• Emphasis on high-quality work
 HR strategies
• Talent management
• continuous improvement
• knowledge management
• Resourcing – attracting and retaining high-quality
people
• Learning and developing – providing an
environment in which employees are encouraged
to learn and develop;
• Reward
• Employee relations
 Developing a HRM strategy
• In developing a HRM strategy two critical questions must be addressed.
– What kinds of people do you need to manage and run your business
to meet your strategic business objectives?

– What people programs and initiatives must be designed and

implemented to attract, develop and retain staff to compete
effectively?
• In order to answer these questions four key dimensions of an organization
must be addressed. These are:
– Culture: the beliefs, values, norms and management style of the
organization
– Organization: the structure, job roles and reporting lines of the
organization
– People: the skill levels, staff potential and management capability
– Human resources systems: the people focused mechanisms which
deliver the strategy - employee selection, communications, training,
rewards, career development, etc.
 New Approaches to organizing HR
• Employers organize their HR services around 4
groups
• Transactional HR Group-focuses on using
centralized call centers and outsourcing
arrangements with vendors
• Corporate HR Group-assisting top management in
top level big picture issues.
• Embedded HR Unit-relationship managers
directly to departments
• Centers of Expertise-like specialized HR consulting
firms within the company
 The trends shaping HRM
• Globalization
• Increased competition
• Technological Innovation
• Deregulations
• Trends in the nature of work-High tech jobs,
Service Jobs, Knowledge work
• Demographic Trends
• Workforce diversity
• Impact of new laws
 Important Trends in HRM
• The new Human Resource Managers
• They focus more on big picture issues
• They find new ways to provide transactional
services
• They have new proficiencies
• Strategic HRMs
• High performance work system
• Evidence based HRM
• New Proficiencies
– HR proficiencies
– Business proficiencies
– Leadership proficiencies
– Learning proficiencies
 Strategies to Handle new trends in
HRM
• Empowered employees
• Flatter organizational structure
• Multi functional responsibility
• Manager to internal consultant or team leader
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rategic-human-resource-management-
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