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Recap

The organisational setting History of management Management and leadership Transformational leadership Management models HRM

Premise
Organisations exist to achieve ends and those ends are achieved through and by people within a defined organisational structure laden with tools and teams. What matters is how managements treat people as ends and what management provides in return. The philosophy of HRM can provide positive guidance on approaches to managing people in, for example the principle of mutual commitment. People in organisation is considered as potential assets rather than merely a variable cost.

New set of assumptions in shaping the meaning of HRM


Proactive system wide intervention, with emphasis on fit, linking HRM with strategic planning and cultural change. People are social capital capable of development Coincidence of interest between stakeholders can be developed Seeks power equalisation for trust and collaboration Open channels of communication to build trust and commitment. Goal orientation Participation and informed choice.

HRM v/s PM
PM views personnel as an element of cost where as HRM views the human resource as a potential return on investment. It can be argued that HRM is simply a term used to describe the natural development of personnel management in response to the ever changing demands made upon orgnisation and how they deal with people. Torrington (1989) commented: PM has grown through the assimilating a number of additional emphases to produce an even richer combination of experience HRM is no revolution but a further dimension to a multi faceted role.

PM v/s HRM: The state of the debate


The replacement of PM models by HRM precepts is a long drawn debate. Indeed HRM has many cogent critics and many skeptical supporters. The criticism against HRM: Old wine in new bottles, the emperors new clothes, the wolf in the sheeps clothing. Critics of HRM: K Legge (1989),
If the business strategy should dictate the choice of HRM policies, will some strategies dictate policies that fail to emphasis commitment, flexibility and quality? Legge also comments on the probable incompatibility of creating an organisational culture which attempts to pursue both individualist and team work policies at the same time.

Features of HRM
Emphasis on the strategic management of people (Human capital of the orgnisation) which achieves fit or integration between the business and the HR strategy. A comprehensive and coherent approach to the provision of mutually supporting employment policies and practices The importance placed on gaining commitment to the organisations mission and values- it is commitment oriented. The treatment of people as asset rather than cost. An approach to employees relations that is unitarist rather than pluralist (employees and employers have same interest) The performance and delivery of HRM as a line management responsibilities

Versions of HRM (storey 1989)


The concepgoverning how employees should be treated in the interest ot of HRM could be regarded as a philosophy f the organisation: Hard HRM: the hard approach to HRM HRM emphasises the quantitative,calculative and business strategic aspects of managing the headcount resource in a rational manner as for any other economic factor. It regards people as human capital from which a return can be obtained by investing judicially in their development. (The matching model) Soft HRM traces its roots to the human relations school. It emphasises communication, motivation and leadership. Storey regards human capital as a means rather than objects. Attention is also drawn to the key role of organisations culture.

HRM goals
HRM aims to help the organisation to achieve success through people. Achieving high performance through people Enhancing motivation, commitment and job engagement Human capital advantage Knowledge management Resourcing Human Resource development Valuing employees Employee relations

HRM activities
Impact area Organisation Activities
Organisation design Organisational development Job and role design Creating climate of trust and developing positive psychological contract HR planning Talent management Recruitment and selection

Employment relationship

Resourcing

HRM activities
Impact area
Performance management

Activities
Measuring and managing performance within agreed frameworks of objectives and competence requirement, assessing and improving performance, identifying and satisfying learning and developmental needs.

HRD

Organisational and individual learning Management development Career management

HRM Activities
Impact Area Reward management Employee relations Activities Pay systems, contingent pay, non financial rewards Industrial relations, employee voice, communication Ensuring a healthy and safe working environment, protecting employees from health hazards and accidents Solutions during prolonged illness, group services such as

Health and Safety

Welfare services Employment and HR services

HRM processes
Strategic HRM: Defining intentions and plans for the development of HRM practices, and ensuring that HR strategies are integrated with the business strategy HRM Policy: Formulating and implementing policies that provide guidelines on how people should be managed in the orgnisation Change management: Advising on and assisting with the facilitation of change in organisation in response to changes in the environment and the introduction of new organisation structures and systems, HR policies and practices Competency based HRM: Developing competency frameworks that inform and support activities such as job design, recruitment, performance management, employee development and reward Knowledge management: Developing processes for capturing and sharing knowledge to enhance organisational learning Job and role analysis: Analysing the content and

Guest et al (2000): Relationship between HRM and performance HR effectivene ss Business strategy HR Practices HR strategy HR outcomes Employee: Competenc e, commitme nt, flexibility

Impact of HR on organisation
Quality of goods and services Financial performanc e Productivity

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