Human Resource Management PowerPoints Instructors

Human Resource Management All rights reserved
©Oxford University Press, 2006

Chapter 1
Nature and Concept of HRM

Introduction
• Challenges faced by organizations
• Global competitiveness – implications on HR
• Work force diversity
• Ethical issues
• Advances in technology and communication
• Sensitive approach to environment
• Shift in employees need for meaningful work

Definition
• HRM refers to acquisition, retention, motivation and

maintenance of Human Resources in an organization.
High power work systems
• Facilititating the competencies and retention of skilled force
• Developing management systems that promote commitment
• Developing practices that foster team work
• Making employees feel valued and rewarded.

Functions
Functions of HRM include
• Facilitating the retention of skilled and competent
employees
• Building the competencies by facilitating continuous
learning and development
• Developing practices that foster team work and flexibility
• Making the employees feel that they are valued and
rewarded for their contribution
• Developing management practices that endanger high
commitment
• Facilitating management of work force diversity and
availability of equal opportunities to all.

HRM and 3 P’s
• People – core strength of an organization

• Any resource can be replaced but not HR
• Processes – evolve over a period of time
• IT enabled environment facilitates engineering
effortlessly
• Performance – the pillars of performance are people
and IT
•Organizational performance in terms of value
creation and return on investment

HRM – Evolution in India
• Growth of public sectors

• Functions of Personal manager
• Personal managemt and Industrial relations functions
•Creations of a HR department
•Changing role of HR functions into a strategic one
•HRM – HRD – competency building

HRM and IT
Influence of IT along the following dimensions:

• IT practices – ability of the company to utilize IT applications
and infrastructure
• IT management practices – sensing, collecting, organizing,
processing and maintaining information
• Information behaviour – organization’s capabilities to
promote behaviours and values that facilitate effectiveness of
information

HRM – Performance Management
• HRM’s primary objective is to facilitate perf to realize
organizational objectives
• Planning for performance time-frame, activities, area wise
targets, tasks to be coordinated.
• Individual contribution leading to organizational goals
• Identification of KRA’s and KPA’s
• Establishing the input-output relationship
• Establishing role clarity and responsibilities

HRM – Leadership Building
• Developing leaders in an organization

• Issues in emergence of leaders
• Knowledge base
• Experience and action orientedness
• People – management capability
• Foresight and acumen

HRM and Change Management
• Facilitating the change process

• Preparing the employees for the change process
• Developing competitive advantage by proactive steps
• Linking HR Strategy and business strategy
• Change as a medium of cultural transformation
• Promotion and implementation of HR policies

Skills of a HR Manager
• Professional knowledge and understanding
• Strategic planning
• Understanding
• Business requirements and realities
• Leadership and teambuilding skills
• Knowledge management capabilities
• Facilitator, coordinator and counselor

Chapter 2
HRM in a Dynamic Environment

Today’s business environment
• Companies need to tap core competencies, respond to
customer’s needs and competitor’s success
•CA obtained thru high quality work force,k enables to
compete
•Emphasis on product quality and service
•Continuous technological upgradation
•HR partnering with business strategies
•Implementing HR strategies to achieve company’s goals

Understanding the present day scenario
• Critical role of HR in identifying competitive
intelligence
• Today’s HR managers should be able to define the value
addition of their strategies
• Performance advantage to be gained by translating
business strategies into HR strategies
• Activities can be resumed, quantified and projected
• Indicating Human assets as Intellectual capital
• Changing role of HR in managing diversity, cross-
cultural issues and playing a consulting role

Issues faced by HR
• Clarity in the functions of HR

• How does the work of HR benefit the business?
• What drives the agenda?
• Identifying the criteria used to evaluate HR functions
• Example of IDRBT
• Shift from a typical business function into a strategic player

Transformation of HR into SHR
• Identifying HR vision
•HR managers acting s business advisors/consultants
•HR professionals need to play a key role as change leaders
•Latest knowledge to be possessed by HR professionals
•Preparing a framework for action for implementing it
• HR managers can use a work force performance model.
Source : World Trade Organization.

Issues to keep in the forefront
HR need to focus on several key success factors in mind
• Through implementation plans highlighting milestones
and progress
• Publicize and market HR strategic capabilities to the rest
of the organization
• Be committed in satisfying the stakeholders
• Acting proactively in handling employee related aspects
•Providing learning opportunities for organizations to
succeed
•Developing overall understanding of all employees

Strategic issues in Corporate Sustainability
• Managers need to think strategically and in futuristic terms

• Taking calculated risks
• Balancing between goal orientedness and flexibility
• Aiming to become a great company and always focusing on
restructuring
•Emphasizing on detailed planning and foster implementation
• Balancing between outsourcing and maintaining core
competencies

Cultural Evolution of corporates
• Command and compliance

• Worker suspicion/Employer distrust
• Low job discretion
• Work - life separation
• Key motivator wealth
• Key value obedience

Contd
1980’s:
• Focus on development
• Limited autonomy
• Worker misgiving/employer doubt
• Limited job discretion
• Key motivator corporate growth
• Key value loyalty

Contd
2000’s
• Minimal hierarchy
• Worker confidence/employer trust
• High role discretion
• Work-life values synergy
•Key motivator fulfillment
• Key value trust

Conclusions
• Pursuit of excellence, value creation and financial
constituents to be kept in mind
• Should be a feeling of uniqueness and collective
engagement
• Sense of belongingness to corporate values, sense of self-
worth and collective purpose
• There should be development of shared ambitions that
engage the organization
• Need to establish unifying values to reinforce and
individual's commitment to organization
• Ability to give employees a sense of personal fulfillment

Chapter 3
Human Resource Planning

HR Planning
HRP is determining the future HR requirements and

how the present HR can be utilized for the same
Conditions that necessitate HRP
• Organizational Productivity/Plans/Strategies
• Expansion/Growth/Diversification
• Economic Development
• Promotions of employees
• Organizational change

HRP - Process
• Objective is to have the appropriate no. and kind at
the right place
• System of matching the supply of existing people with
opportunities in the organization
• Focuses on organizational objectives, production
schedules, demand fluctuations
• Making an inventory of existing human resources
• Anticipating HR problems and projecting
quantitatively and qualitatively
• Planning and placing employees at right places to meet
organizational requirements

Steps for HR Planning (Starting)
• Manipulating the database
• Develop measures to indicate effective utilization of
HR
• Develop methods of economic assessment of HR to
reflect its income generators
• Evaluate the procurement, promotions and retention
of effective HR
• Maximizing human potential in a cost-effective
manner
• Monitor and measure the plans and keep top
management informed about it

Factors affecting HR planning
• Lack of skilled resources/obsolescence

• Separation of employees
• Change in organizational objectives
• Technological changes – policies
• Changes within the organization like promotions –
succession planning
• Government policies/regulations

Steps in the HRP process
• Linking organizational strategy to employment planning
• Forecast labor requirements for a future time period
• Develop a talent inventory
• Conduct a gap analysis to reconcile demand supply
• Action plans to engage the pool of qualified people
• Reviewing and monitoring HR activities in so far as
reaching objectives

Linking Organizational Strategy to
Employee Planning
• Focus on the vision

• External supply
• Internal supply analysis
• Availability/scarcity of labor
• Amazon.com
• Cost effectiveness

Forecasting
• Forecasts are of two types: Demand forecasting and supply

forecasting
• Demand forecasting is affected by business projections
• Qualitative – Quantitative
• Qualitative – Delphi – NGT
• Quantitative – Trend analysis
• Regression analysis

Trend Analysis
• Determination of appropriate business factor that relates to

workforce
• Identify the historical records of that in the past
• Calculate the productivity ratio
• Determine the trend
• Make necessary adjustments in the trend, past and future
• Project to the target year

Supply Forecasting
• Succession planning/career plans

• Database generated from payrolls, job profiles, job families,
age distributions and experiences
• Company’s internal policies/practices
• Performance appraisal system and results
• Market analysis – projections
• External supply/computer simulation

Implementation Plans
• Recruitment and retention plans
• Selection and promotion plans

• Training plans
• Appraisal plans
• Redeployment plans
• Downsizing plans

Chapter 4
Work Analysis And Design

Introduction
• Job analysis is a systematic process of gathering information

about work, jobs and relationships between jobs
Need for a job analysis arises because of:
•Corporate restructuring process,
•Quality improvement programs,
•Recruitment strategies
•Training programs and succession planning

Objectives of Job Analysis
• Establish the job- relatedness of employment procedures
•Facilitate selection of appropriate Human Resource
•Indicates training needs
•Provide information to conduct salary surveys
•Provide a basis for evaluating performance
•Improve quality and productivity

Process of Job Analysis
Process of Job Analysis involves job descriptions, specifications

and evaluations and the identification of types of skills,
knowledge and information to perform the same
• Work activities
• Human behaviours
• Performance standards
• Job context
• Human requirements

Steps in the process of Job Analysis
Work analysis follows a systems approach

• Identify the work process of concern
•Select and train a team to conduct the analysis
•Treat the work process using document trails and list them
by positions
•Add other supplementary information
•Synthesizing information and activities

Methods of Job Analysis
It is a scientific method of collecting information about duties,
responsibilities and accountabilities of a job. Data gathering
through:
• Observation
• Desk audit
• Individual or group interviews
• Questionnaires
• Diary/logs
• Critical incidents

Aspects of a job to be analyzed
• Duties and responsibilities

•Environment
•Tools and equipment
•Relationships
•Requirements
•Contextual factors

Job Description
Job description is a written statement of duties,

responsibilities, essential qualifications and reporting on the
job. Methods of collecting information:
• Interviewing
• Questionnaire
• Observation
• Participant/diary log
• Experts

Guidelines for effective Job descriptions
• Clarity
•Specificity
•Indicating scope of authority
•Being brief
•Providing the scope of information
•Rechecking the information

Job Specifications
Specify the minimum acceptable

• Qualifications
• Skills, knowledge
• Abilities, experience
• Specific temperaments
• Special traits/characteristics
• Aptitudes

Job Evaluation
Job evaluation basically specifies the relative value of each job.
• Job Design
• Job Rotation
• Job Enrichment
• Job Enlargement

Chapter 5
Recruitment and Retention

Introduction
High performance work systems

• Large numbers of highly qualified applicants for each
position
•Use of validated selection and promotion models
•Training and development of new employees
•Differential pay structures for low and high performers
•High percentage of people working in self-managed teams
•Use of multisource appraisal and feedback.

Definition and Importance
Recruitment is an art of discovering and procuring potential

applicants for actual and anticipated vacancies.
• Recruitment follows HRP
•Organizations require people for continued operations in the
organizations
•It forms the basis for selection process
•Attracting and retaining the best talent is necessary for
organization’s success
•Having the right type of resource is a means and ends in
productivity

Factors affecting Recruitment
Size
•Large organizations indulge in continuous recruitment
•Employment conditions in the community plays a potential
factor
•Geographical factors and conditions play an important role
•Organizational policies like promotions from within attract
the employees
•Compensation and benefit packages influence and attract the
employees
•Growing and expanding organizations attract employees

Constraints and Challenges in the
recruitment process
• Perceived image of the organization

•Attractiveness of the job
•Organizational policies
•Legislation/Governmental policies
•Costs of recruitment

Recruitment policy may include:
•Identifying the public policy on hiring and employment
relationship
•Providing maximum employment security
•Encouraging employees with continuing development of
talent and skills
•Assuring fairness to the employees
•Providing employment to physically handicapped or minority
community as stipulated
•Assuring organization’s interest in his goals and employment
objectives.
Steps in recruitment process
•Process is interlinked and interdependent with other

activities
•Employee planning and work analysis
•Deciding on the number of vacancies and selecting a
source
•Advertising vacancies
•Screening the applicants
•Filling vacancies

Sources of recruitment
•Internal and External sources
•Internal source – Selecting suitable candidate from among the
current employees in an organization
•Employee referrals, promotions from within, succession
planning.
Advantages:
•Builds employee morale
•Involves less cost than booking for outside
•Facilitates people to be places in the middle and top level
positions
External source of recruitment
•Walk in/write in
•Advertising
•Private placement agencies
•Government – employment exchanges
•Campus recruitment
•Head hunters
•Military
•Professional associations

Electronic recruiting
•Recruitment thru internet

•Advantage is wide publicity and a chance for a large
number of applicants to choose
•Best method to be assessed depends upon:
- Cost per hire
- Number of resumes
- Time-lapse between recruitment and placement ratio
- Applicant performance and turnover

Retention of employees
•Planning ahead
•Clarity in job requirements
•Identify a good source of recruitment
•Screening and interviewing
•Providing challenging work
•Focus on compensation and working conditions

Chapter 6
SELECTION PROCESS

Objectives
After reading this chapter, you will be able to

understand:
• The steps in selection process

• The different methods of selection
• The various issues involved in selection process

Introduction
• Process which begins after recruitment
•Process of choosing the right candidate from the obtained
applications to match the requirements of the job
•Process of matching the skills of the individual and the
requirements of the job
•Plays a pivotal role in the entire human resource process
•Care has to be exercised in this step as it affects the career of
the individual and the future of the organization
•Regardless of the tenure of the individual in the organization,
the quality of output of the individual is very important

Steps in Selection process
• Preliminary screening of the application
•Completion of the application forms
•Employment tests, interviews
•Medical examinations
•Background investigations, reference checks
•Final decision to hire

Step I - Preliminary screening of the
application
•Preliminary screening helps the organization to eliminate
misfits among applicants at a later stage
•Working a selection ratio from the total number of applicants
and the number of candidates to be called for interviews
•Some criteria for screening of applicants may be:
- Personality characteristics/aptitudes
- Language proficiency
- Experience/technical knowledge

Step II – Application Blank
•Completed application blank helps to predict the candidates
chances of success on the job
•Provides basic information like biographical data, educational
background, interests etc.
•Provides a brief history of the candidate and can be used for
future reference
•Weighted application blank can be developed to generate scores
•Job related aspects may be identified, scores may be assigned to
them
•It speeds up the recruitment and selection process

Use of employment tests
A test is a standardized tool administered to elicit responses
on specific aspects.
•Characteristics of a good test are standardization, reliability,
validity and norms
•Types of tests are:
- Intelligence test
- Aptitude test
- Personality test
- Projective test
- Interest/achievement test

Other selection methods
• Work simulations
•Assessment centres
•Customer situation
•Employee discussions
•In-basket
•Problem analysis

Interviewing the candidate
• Interviews are used to assess the applicants’ personality

as also the intelligence, interests, attitudes etc
•Structured interview
•Unstructured or open-ended interview
•Stress interview
•Errors in interviewing like – halo effect, leniency,
projection, stereo-typing etc.
•Guidelines for effective conduct of interview

Background checking and information
• Procuring medical fitness certificates and verifying them

•Verifying and establishing the bonafides by background
checking
•Contacting previous employers or college professors/teachers
•Establishing credibility
•Hiring decision
•Offering of the appointment letter

Selection in other countries
•Examples from Asia

- Korea
- Japan
- US
- UK, Switzerland
- Hong Kong

Chapter 7
PLACEMENT PROCEDURES

Objectives
After reading this chapter, you will be able to understand:

•The concepts of placement and induction
•The process of induction in the organization
•The promotional policies of an organization
•The other internal mobility procedures
•The various forms of separations of the employee in an
organization

Introduction
Placement refers to the actual procedure wherein an
individual is assigned with a job
•It is the final decision taken about the candidate as to the
position that the candidate has to occupy
•It also involves assigning a specific task and responsibility
•This step follows after matching the requirements of a job
with the qualification of a candidate
•When handled carefully, it reduces absenteeism, prevents
accidents and classifies expectations
•In the absence of the above, it results in frustration for the
individual

Socialization and induction
• Process by which an individual learns to appreciate the

values, abilities, expected behaviors and social knowledge
• With the help of socialization individual learns to operate
within the policies, procedures and culture
•Induction is the process that introduces an employee to the
organization
•It is usually the responsibility of the HR department to
conduct induction process

Immediate supervisor might introduce the following steps:
•Welcomes the newcomer
•Explains the overall objectives of the company and his role
•Shows the location or place of work
•Hands over the rule book or job descriptions
•Provides details about training and promotional
advancements
•Discusses working conditions

Topics that are usually covered are:
Organizational issues:
•History of that company
•Layout and physical facilities
•Products/services offered
•Overview of the company procedures
•Disciplinary procedures
•Probationary period

Employee benefits
•Pay scales
•Vacations, holidays
•Schedules
•Counseling
•Other benefits
•Training opportunities

Global Placement
Global HR is performance of HR functions within an
organization that operates internationally. Functions are:
•Managing international relocation of expatriates
•Providing a variety of services for relocating employees
•Building close relationships with other countries
•Identifying criteria for success in overseas assignment
•Motivating employees to take up overseas assignments
•Establishing a strong relation between HR planning and
strategic planning

Promotions
Promotion is an advancement of an employee to a higher
position with better pay, working conditions and challenges.
•Purpose is to encourage employees and reward merit
•Each organization has its own promotion policy
•Organizations need to strike a balance between promotions
from within and external recruitment
•Performance appraisals need to be considered carefully for
promotions
•Promotions may be synchronized with the career pathways
identified by the organization.

Transfers
•Transfer is a change in job assignment, a horizontal
movement requiring application of similar skills
Transfer may take place because of:
•Change in productivity, production schedule, product line,
market conditions etc.
•Better utilization of employee skills
•Exposing the individual for different jobs to improve their
capabilities
•Provide relief to some over-burdened employees
•Disciplinary measure to punish some employees

Separations
Separations take place because of a decision initiated by
either the employer or the employee
•It may occur because of long leave of absence, resignations,
retirements or death
•Downsizing, layoff and retrenchment are separation
procedures initiated by the employer
•Downsizing is undertaken to reduce labor costs and
streamline organizational operations
•A layoff occurs due to breakdown of machinery, shortage of
power, raw materials etc.
•Retrenchment is permanently laying off surplus staff due to
poor demand for products or economic slow down
•Other forms of separations are: Suspension or dismissal of
an employee.

Chapter 8
CAREER DEVELOPMENT AND
PLANNING

Career Development and Planning
•Introduction
•Business environment competitive and complex
•Ambiguity and uncertainty- career dev
•Career growth crossed boundaries
•Needs of the individuals are changing
•Restructuring, down sizing, lay offs etc
•Need for employability of individuals.

Definition
•Career is a sequence of positions occupied by persons

during the course of his life
•Career Vs Job
•Importance of career planning
•Increasing educational levels/slow economic growth and
reduced opportunities for advancement
•Occupational aspirations
•Concern for personal life planning and quality of work life

Career Planning
•Is a deliberate attempt by an individual to become aware

of his skills, interests, values, opportunities, choices and
consequences
•Career planning is also done by the organizations
•Identifying career related goals and establishing plans
•Concern of the organizations is to identify and relate the
needs of the employees
•Multi-skilling and cross functional experiences have
become necessary
•Need to plan career smoothly, calculated and
progressively

CP – Individual perspective
•Choosing a field of employment

•Regard every position and job with value and potential
•Be prepared for lateral moves or shifts jobs if they are
providing opportunity for career growth
•Assess your current performances and obtain feedback from
top management
•Become sensitive to the stage of diminished utility
•Assess indicators of job change

Planning your exit
Other indicators of job:
•Career advancement is blocked, organization is poorly
managed, company is loosing its market share, reward
structure does not suit us etc.
•Organize your exit
•Establish networking relationships
•Leave with good terms and not in questioning situations
•Do not leave a job until you find another one

CP-Organizational perspective
•Provide opportunities and tools to enhance their skills
•Create a supporting environment for learning and
development
•Provide opportunities for self assessment and training
•Managers may also act as coaches and mentors to assist
employees
•Use reward systems that support organizational career
development strategy
•Make sure that career programs are integrated with other
HR programs

Theories of Career development
•Roe’s theory of Career choice

•Ginzberg’s theory of career choice
•Super’s theory of career development
•Crite’s model of career maturity

Career development system
Career development system integrates individual career
planning and organizational career management
activities involving employees management and
organization
•Entry level
•Individual – developing the career
•Org- socialization and induction programs
•Providing mentors
•Culture carriers
•Behavioral modifications

Career Development - Issues
•Positive relationship between first job and later career

success
•Managing employees in mid career
•Managing dual career jobs
•Managing VRS employees
•Career dev in down sized organizations

Career Success
•Linking of HR programs and career programs

•Competency development programs
•Management development programs
•Expertise and position
•Generalist and specialist

Chapter 9
TRAINING

Introduction
• Need for organizations to build and sustain competencies that
would provide them with competitive advantage.
•Knowledge era Human assets are valued highly.
•Growth oriented organizations value training as a response to
changing environment
•Continues learning process in human development
•Helps in development of one’s personality, sharpens skills and
enhances effectives
•It is an important and integral part of organizational renewal
process

Training and development
Training is a process through which a person enhances and

develops his efficiency, capacity, and effectiveness at work by
improving and updating his knowledge and understanding the
skills relevant to his or her job.
•Training and development

•Training Vs. education
•Training at different levels
•Learning curve
•Transfer of learning

Functions of a training program
•Acquiring knowledge
•Change in attitudes
•Helping to put theory into practice
•Helps to evaluate abilities, competencies
•Enhances problem solving and decision making ability
•Improves performance

Importance of training
•Aids in new entrants attaining role clarity

•Prevents skill obsolescence
•Improves quality and productivity
•Meet organizational objectives
•Improves organizational climate
•To support personal growth and development

Success of a training program depends
upon
•Intention to learn from the participant
•Reinforcement provided to the learner
•Developing the potential from an individual’s point of view
•Active participation of the trainee
•Providing opportunities for practice
•Transfer of learning to take place from a training program

Training methods on the job/off the job
On the job training methods are:
•Job instruction training

•Vestibule training
•Training by supervisors
•Coaching on the job
•Apprenticeship
•Job rotation

Training methods (Contd)
Off the job training methods:
• Lectures
• Conferences
• Case studies
• Role play
• T group/Sensitivity training
• Programmed instruction training

Evaluation of training
Criteria for evaluation are:
• Objectives of the program
• Cost-benefit analysis
• Results obtained
• Areas of improvement
• Resources required
Methods of evaluation would be:

Questionnaires, projects, tests, interviews, observations or
participation and discussions.

New perspectives on training
• Cross cultural approaches

• Maintenance of standards
• Interaction with learners
• Use of technology – CD ROMs, WAN, CBT, WBT
• E-learning – types
• Informal learning, self-paced, leader lead learning and
performance support tools

Benefits of E-learning
• Learning at ones own pace

• Accessibility
• Active learning
• Cost effectiveness
• Collaborative learning
• Personalized learning environment

Weakness of E-learning
• Shift of focus to the learner

• Data over load
• Data unreliability
• Net work/ hardware unreliability
• Access control
• Less theory

Emerging issues
• Training is not equally distributed to all employees
• Expenditure allocated to training is inadequate
• Mismatch between theory and practice
• Benefits of training are not immediately realized
• Supporting contextual systems needs to be provided in
organizations
• Top management needs to support the philosophy of
training in spirit

Chapter 10
Developing Managers

Objectives
After reading this chapter, you will be able to

understand:
• The nature and purpose of executive development
programs
• The methods and techniques of Executive development
• The factors influencing executive development
• Executive development and organization development
• Evaluation of Executive development programs and its
importance

Introduction
• Need to continuously train and upgrade the skills of the
manager to face the competition
•Need to hone leadership skills among managers
•Orientation to learning needs to bee done in a systematic

manner
•Adapting and learning information technology is essential for

today’s managers
•EDP also focuses on people management skills as it is essential
for today’s managers.
Process of executive development
Organizational environment
Organizational strategy/objectives
Identifying competency gaps
Training needs assessment
Training plan
Conduct of the training program

Factors Influencing Executive Development
Failure to train will result in:
•Ineffective and inefficient managers
•Performing managers may be de-motivated and frustrated
•Organizational performance gets affected because of loss of
market shares, low sales, less profits etc.
•Shortage of trained/skilled managers might result in
developing managers and training them
•Competitive pressures make it necessary to cull out
good/different products
• Managers need different skills to face the competitive
scenario.

Areas of EDP
•Decision making skills
•Interpersonal skills
•Job knowledge
•Organizational knowledge
•Specific individual meets
•General knowledge

Factors in designing an EDP
•Learning characteristics and its applicability to design

•Knowledge of results
•Reward mechanism
•Individual difference of the learners
•Application to the work environment
•Meeting organizational goals thru content design

Methods of EDP
• In basket
•Business games
•Case study
•Role play
•Sensitivity training
•On the job training

Methods of EDP (Contd)
•Coaching
•Job rotation
•Special courses
•Special projects
•Committee assignments

Evaluation
Evaluation of EDP is important for the following reasons:
• Improving the quality of training and development process
• Improving the efficiency and competency of trainers
• Make improvements in the system to make it more

responsive
• Aligning the training objectives to organizational objectives
• Evaluating the ROI on account of training and development
• Changing the perception of the management as to regard

training as an investment
Levels of Evaluation
• Reaction level
•Immediate level
•Intermediate level
•Ultimate level
•Other methods include questionnaires, interviews, observation

etc.
•Desk research – means using the present data to view trends

and expectations

Chapter 11
Need and Importance of Performance

Appraisal

Introduction
•Performance appraisal began with Henri Fayol who began
with performance improvement
•Hawthorne highlighted the factors underlying factors
•Organizations differ in the method of performance
evaluation of their employees
•Individual Performance is a highly variable and dependent
factor
•Organizations are more concerned with optimum
performance levels in the employees
•Organizatiopn as are also concerned with better utilization
of feedback for performance improvement
Objectives
Performance appraisal is the process of reviewing employee

performance, documenting the review and delivering it to
the employee in the form of feedback. Objectives are:
•Used for performance management and compensation
•Used for employee development in the form of promotions
•Identification of training needs
•Used for personal development of the employee
•To establish an efficient system of productivity

Appraisal process
Steps usually involved in the appraisal process are:
• Establishing standards of performance

• Communicating the performance
• Measuring the actual performance
• Comparing the actual performance with established
standards and discussing appraisal process
• Taking corrective actions whenever necessary
• Implementing measures leading to performance
improvement

Methods of performance appraisal
Traditional methods:
•Graphic rating scales
•Ranking method
•Rained compensation method
•Forced distribution method
•Checklist method
•Essay from appraisal
•Confidential reports

Modern methods
•Behaviorally anchored rating scales

•Assessment centres
•Human asset encounting method
•Management by objectives
•360º performance appraisal

Errors in the appraisal process
• Leniency error
•Halo error
•Similarity error
•Error of central tendency

Planning for performance improvement
Focusing on organizational strategy and performance

•Role of culture in organizational performance
•Impact of leadership on performance
•Developing trust among employees
•Developing the learning capacity of organizations
•Restructuring and redesigning the work analysis
•Outsourcing as a strategic initiative in cost cutting measures

HRM – Strategic management
• Change and learning as imperatives for performance of

employees
•Organizational learning as a continuous process necessary for
performance improvement
•Creating self-motivated situations which enhance self-worth
•Creating SBU’s/group targets to reach organizational goals
•Proving autonomy and empowering employees
•Organization has to create opportunities for interactions, then
group discussions, seminars etc.

Knowledge, Learning and performance
Steps involved in knowledge management are:
•Specifying the goals of knowledge
•Collecting the required knowledge along with sources
•Processing and developing the acquired knowledge for
presentation purposes
•Transfer of knowledge across individuals and groups
•Application of this knowledge for value addition
•Storage of knowledge for timely availability

HR and Performance planning
HR strategy is the long term function for direction. Steps of
planning are:
•Identifying and integrating the business opportunities
•Motivating the employees
•Developing the employee competencies
•Creation of coherent functional/project teams
•Setting the performance goals in conjunction with
project/functional head
•Facilitating the performance planning and achievement of
employees
Chapter 12
Employee Motivation, Incentive Plan

and Fringe Benefits

Objectives
• After reading this chapter, you would understand:-

· Motivation and its basic factors
• Theoretical background of motivation
• Incentive plans & Fringe benefits
• Role of Fringe benefits in employee motivation
• Balancing employee participation while designing incentives
and fringe benefits

Basic Motivational Process
Motivation is a basic psychological process and is defined
as innate need or desire. The defense mechanisms are:-
• Repression
• Reaction formation
• Projection
• Rationalization
• Intellectualization
• Displacement
• Regression

Nature of Work & Work Motivation
Instrumental for survival

Contributes to personal identity
Provides opportunities for interaction
Enables to sustain status and self respect
Provides scope for personal achievement
Assures one-self of one’s capacity

Theories of Motivation
Chris Agryris’s Immaturity – Maturity Theory
Maslow’s Need-hierarchy theory
Herzberg’s Two-factor theory
Alderfer’s ERG Theory
McClelland’s Achievement Motive Theory
Vroom’s Expectancy Model
Porter and Lawler’s Performance – Satisfaction Model

Applications of Motivational Concepts
• Motivational Concepts can be used for:-
o Job designing

• Job enlargement
• Job enrichment
• Goal setting
• Incentives

Incentives
• Incentives can be financial and non-financial. The types
of incentives include:-
·Minimum wages
•Bonus incentives
•Standard time fixation
• The various systems used for fixing incentives are:-
• Taylor’s differential piece-rate system
• Merrick’s differential piece-rate system
• Halsey plan

Group Bonus Plans
• The various types are:-
·Priestman’s production bonus

• Rucker, or share of production plan
• Sconlon plan
• Towne plan

Profit-sharing or stock-option plans
(Advantages)
·Ensure employee’s sincerity and loyalty

•·Supplements remuneration
•·Motivates employees
•·Helps attraction of talented people
•·Reduces burden of supervision

Profit-sharing or stock-option plans
(Disadvantages)
·If the organization is not careful, it can lose

•·Management can report false profits for paying less
•·Impair the unity and oneness of trade unions
•·Fixing worker’s share of profit is risky

Chapter 13
Compensation Packages and the

Wages and Bonus Act

Objectives
• Goal of compensation management
• Factors influencing various compensation structures

• Competence based compensation programmes
• Differential compensation to executives
• Various methods of working out compensation packages

How compensation is used
• Recruit and retain qualified employees

• Increase or maintain employee morale
• Reward and encourage peak performance
• Achieve internal and external equity
• Reduce attrition
• Reward exceptional performance

Psychological Contract
A psychological contract is a systems of beliefs which includes on
one hand employee expectations and on other the employer
trust. The aspects fro employee perspective , covered include :
· Treating of employee in fairness,equity etc.,
· Security of employment, career expectations, involvement in
the decision making from employer’s point of view, the contract
covers
•· Competence
•· Effort
•· Compliance
•· Commitment and
•· Loyalty

Theories underlying motivation and
remuneration
• Maslow's need-hierarchy theory

• Herzberg two-factor theory
• Porter and Lawler’s model of motivation
• Adam’s equity theory

Factors Affecting Pay levels
• Judgments about job values and comparison with other

jobs
• Belief about worth of the job
• Individual characteristics such as age, experience,
seniority etc.,
• Demand and supply


Assessing job worth
Assessing of job includes job analysis and evaluation and the
details are as under:
• Job analysis is the process of collecting, analyzing and
setting out information about jobs in order to provide a basis
for job description. It provides data for job evaluation and
performance management.
• Job evaluation is a process of assessing the relative
importance of jobs within the organization. Involves use of
information obtained through job analysis to systematically
determine value of each job. The various approaches of
evaluation are:
• Job ranking
• Job classification
• Point factor plans

Developing pay structures
Pay structures are dependent on various aspects such as organizational
philosophy, market trends,. The various options include single-rate
structure and tenure based. The various sources of data:
• Conduct of surveys
• Reports published by ministry of labour
• Pay commission reports
• Report of wage boards appointed by government
• Reports of employers’ and employees organizations
• Trade journals

Principles of wage and salary administration
•Organization may have definite plan to ensure differences in
pay as per job requirements
•General level of wage/salary should be in line with market
rate
•Equal pay for equal work
•Rewarding of special abilities and skills
•Flexibility and adoptability of pay structure according to
economic conditions
•Should be able fulfill individual needs

Theories of wages
• Adam Smiths wage fund theory
• Subsistence theory
• Karl Marx’s theory
• Residual claimant theory
• Marginal productivity theory
• Concepts of wages include
• Minimum wage
• Living Wage
• Fair Wage

Payment of Bonus Act, 1965
The objectives of the act are:
•Impose statutory obligation on every employer to pay bonus every

year
•Outline principles of payment of bonus according to prescribed
formula
•Provide for payment of maximum and minimum bonus
•Machinery for enforcement of payment

Current Trends in Salary Administration
•Broad banding indicates compressing hierarchy of pay and grades

into a smaller number of wide brands. The objectives are :
•Allows flexibility in making and administering pay decisions
•Recognizes that careers are more likely to develop within
homogenous levels of responsibility
•Reduces pre-occupation with grade status
•Developing of more responsibility among line managers
•Provides flexibility and opportunity in simplifying benefits
•Focus on value adding tiers in organization

Advantages of broad banding
•Enhances flexibility in pay delivery, managing the reward system
and adjusting the pay in response to market situation.
•Reflect and support the operation of a process based organization
with fewer levels
•Supports teamwork by encouraging development of multi-focus roles
and boundaryless organization.
•Provide rewards for lateral career development
•Provides means for integrating reward and employee development
•Addresses personal growth needs of employees by offering pay
opportunities
•Reward people for their additional contribution, beyond their job
description•

Disadvantages of broad banding
• Restrict the number of promotional opportunities

• May face resistance from employees and unions
• Employees in higher grades could be devalued
• May mean return to old days of favoritism by management
• Takes much time to maintain and establish broad banding
• May lead to escalation of payroll costs
• May run into conflict with traditional hierarchical
organizations

Pay for competence and skill (advantages)
It is obligatory on the part of management to nurture and
reward skill and competence. The advantages of the system
are:
• Creates empowered work force in flat structure
•· Requires few supervisors
•· Provides opportunity to employee to chart his own
career
•· Focuses on need for higher levels of competence
•· Encourages competence development
•· Fits de-layered organizations and lateral career moves

Pay for competence and skill
(disadvantages)
The disadvantages of the competence-related pay are:
• Unless careful control is exercised, costs may escalate if
employees are paid competencies, which they rarely or ever use.
•· Assessment and documentation of competence levels can be
time consuming and expensive.
•· Effectiveness of competence-related pay depends on the fair and
consistent measurement of competence levels, and this may be
difficult.
•· Implementing such a system requires considerable resources in
terms of training and support.

Team Rewards
New method of compensation that is gaining popularity is
rewarding group or members. Teams emphasize
shared leadership, mutual accountability, and collective
work products. The characteristics of well functioning
team are:
•Atmosphere tends to be informal, relaxed and
comfortable
•Team’s task is well understood and accepted by
members
•People express their feelings as well as ideas
•Conflict and disagreement are related to ideas or
methods, not people.
•Team is conscious of its own operation and function

Advantages of Team Pay
• Encourage teamwork and cooperation

• Clarify team goals and priorities, and provide for
integration of team and organizational objectives
• Reinforce organizational change in the direction of
increased emphasis on teams
• Enhance flexible working within teams and encourage
multi-skilling
• Provide incentives for groups to work collectively

Disadvantages of teams
• Effectiveness depends on well-defined and mature

teams
• Teams may be inappropriate to individuals whose
feelings of self-worth may be diminished
• Singling contribution of individual team members
could be a problem
• Pressure to confirm may force to produce lowest

International Compensation
Globalization and rapid integration of markets and

need to develop managers to for international
careers has forced managements to think in terms of
international compensation.
• The salary of expatriate begins at home-based one
• Reason for assignment
• Duration of assignment


Chapter 14
Industrial Relations and Issues

Initiatives of Government
• The passing of Industrial Disputes Act, 1947:
•Section 3 of the Act stipulates that it is mandatory for
industrial establishments which employ 100 or more
workers to set up a worker committee
•Section 9C stipulates that establishments of 50 or more
workers to have grievance settlements machinery
•For safeguarding the interests of women workers, a
women’s wing of Standing Committee of Public Enterprises
(SCOPE), to look into following aspects:
–Development of a database and information network
–Training and developments, including entrepreneurial
training
–Counseling services
–Day-care centers
Theories of Industrial Relations
• Miller and Form’s model

•Dunlop’s Model
•Effect of globalization in India:
–Drift towards market economy
–Changing composition of workforce
–Transformation of role of trade unions
–Fluctuating market conditions and flexible labor market

Role of Government in Industrial
Relations
• Government one of the key players
•Directive principles of state policy – articles 39, 41, 42, 43
and 43 A pertain to labour
•Various five year plans
–First five year plan: Envisaged the formulation of
tripartite boards
–Second five year plan: Formation of joint management
councils

Role of Government in Industrial
Relations
• Third Five year plan: Formation of code that facilitated a

grievance redressal mechanism
•Fourth Five Year Plan: Emphasized on the need for
healthy growth of trade unions
•Sixth Five-Year Plan: Made a comprehensive policy
statement on labour. Focus on improving services of ESI,
EPF and FPS.
•Seventh Five Year Plan: Plan emphasized the need for
improving capacity utilization, efficiency and productivity.

Role of Government in Industrial Relations
• Eighth Five Year Plan : Objectives stated in the document

include improvement of quality of labour, productivity,
competence, welfare etc.,
•Ninth Five Year Plan : Envisaged industrial development
including delisensing of coal, lignite and petroleum products
•Tenth Five Year Plan: Emphasized on improving productivity
of labour

Best Employer Practices
• Core values
•Involvement of line and top management in HR initiatives
•HR measurement and success criteria
•Empowerment
•Involvement of employees in organizational change
•Openness
•Employee orientation

Best Employer Practices
• Constant innovation in people programs

•Efficacy in delivery of HR services
•Opportunities for accelerated growth and development
•Depth and breadth and consistency in application of HR
practices
•Sensitivity towards a balance between work and personal life

Core beliefs that underlie actions of
best employers
• Best employers never underestimate the power of dreams

•Best employers understand the influence of human relations
•Best employers know that everybody has a potential for
greatness

Role of CEO in building bets employer
organization
• Regular listening, communication and sharing and being
in touch with employees
•Leading by example, inspiring, motivating and bringing out
best in people
•Building culture and pride
•Being a coach, mentoring and supporting people in time of
crisis
•Promoting empowerment, involvement and accountability
•Changing attitudes and mindsets ; helping people adapt to
new realities

Recognition of trade Unions
• The members of the representative union should
comprise at least 25% of the total number of employees in
the industry
•Qualified unions should have at least 5% of the
membership in the industry
•Primary unions should have at least 15% of employees in
the undertaking
•The representative union, under the Industrial Disputes
Act will have the first right to appear in any proceedings,
right to submit a dispute for arbitration, and more
importantly the office bearers cannot be dismissed or
discharged

Employers Associations in the Country
• International Labour Organization

•Associated Chambers of Commerce in India
(ASSOCHAM)
•Federation of Indian Chambers of commerce of India
(FICCI)
•Employers’ organizations are mainly structured at three
levels – local, regional and central

HRM Practices – Change in perspective
• Effective HR practices include: -
•Provision of financial incentives for better performers
•Practices that motivate employees to contribute by optimally
using their knowledge skills on the job
•Effective recruitment policies
•Satisfactory, that is, more than industry average, compensation
structures
•Information dissemination to make employees comprehend
organizational plans
•Employee empowerment
•Training and development, which ensures minimum training
to each employee
•Career progression possibilities

Trade Unions and Industrial relations in
future
• Four major scenarios that can emerge :
•Unions and negotiated procedures for union management

relations can be done way with
•Unions per se could be ignored
•New systems could run in parallel to existing methods
•Existing arrangements could be integrated into the new
approach that evolves over a period of time

Chapter 15
Collective Bargaining and Worker’s

Participation in India

Chapter Objectives
• Nature scope and process of collective bargaining

•Comparison of collective bargaining in developing and
developed countries
•Role of collective bargaining in wage negotiation and
employee welfare
•Significance of worker’s participation
•Forms of worker participation in management
•Indian schemes of worker participation
•Function of quality circles

Freedom of Association
• Legal framework (at all levels of government)

•The government’s performance in implementation
•The overall outcome

Criteria for assessment
• Whether the country has a legal provision that entitles

workers or employers to establish an organization of their
choice
•Extent of legal restrictions of the abilities to organize certain
categories
•Legal provisions that permit governments interference in
freedom of association
•Whether collective bargaining is protected by law
•Whether legal regulations permit employers to dismiss or
replace striking workers

Features of Collective Bargaining
• Essentially a group action and is initiated by representative of
workers
•Process is flexible and it provides both parties a scope of
compromise and facilitates a mutual give and take environment
for final agreement or settlement
•Two-party process where both strive to arrive at an agreement
for settling a dispute, devoid of animosity and mutual hatred
•Continuous process, which provides for building and
sustaining relationships between management and trade unions
with common objective of resolving employee grievance and
plant problems
•Reflects implementation of industrial democracy

Principles of collective bargaining
• Process should provide scope for union leaders to educate

the management about the desires and grievances of
employees
•Both union leaders as well as the management should
approach collective bargaining with a view to find best
possible solutions and not a confessional approach
•Both parties to have respect for each other
•Both parties should have spirit to abide by the laws
applicable for collective barraging

Types of Collective Bargaining
• Single plant bargaining – bargaining between union and

management at plant level
•Multiple plant bargaining - the bargaining between
management and multiple manufacturing plants and
workers employed in those plants
•Multiple employer bargaining – the bargaining between
unions of workers and managements

Collective Bargaining in India
• The limited success of collective bargaining on account of:
•Absence of strong unions, multiplicity and inter/intra union
rivalries
•Lack of initiative by the government for development of the
process of collective bargaining
•Easy accessibility of adjudication leading loss of sheen for
collective barraging
•Political interference in union matters and intra-party
causing inter-union rivalry
•Negative attitude of managements

Recommendations for success of collective
bargaining
• Limited intervention by the government and usage of

compulsory adjudication as the last resort
•Strengthening the trade unions organizationally and
financially through :
–Compulsory registration of trade unions
–Enhancement of membership fee
–Reduction of external influence in union bodies and
office bearers

Labour Laws
• The Factories Act of 1948 provides rules and regulations
regarding terms and condition of employment
•The Minimum wages Act, 1950 provides for payment of
minimum wages to the employees
•The Maternity Benefit Act, 1961 provides to women workers
in the event of their pregnancy
•The employee State Insurance Act, 1948 ensures
comprehensive health coverage to employees below at a
certain minimum level.
•The payment of bus Act, 1965 imposes statutory obligation on
employers to pay minimum of 8.3% of basic salary
•The payment of gratuity Act, 1972
•Employees Provident Fund and Family pension scheme, 1971

Workers Participation in management
• Factors influencing worker’s participation in management

are:
•Technology adoption leading to complexity in production
which calls for increased participation
•Employers no longer treated as subservient but as equals
•Growing influence of unions prevents exploitation of
employees by management
•There are regulations and legislations that facilitate
increased WPM
•Higher levels of productivity and efficiency only can come
through motivated and committed employees

Objectives of WPM
• Improve organizational efficiency and maintain cordial

relations
•Develop solidarity in the working community and bring out
the latent skills of human resources
•Accede to respectable employee status both within the
workers and also with the management
•Prevention of worker exploitation, facilitate worker growth


Forms of WPM
• Works committee
• Joint management Councils
• Joint councils
• Unit Councils
• Plant councils
• Shop Councils
• Workers presentation in management board
• Workers participation in capital share

Evaluation of WPM in India
The failure of WPM in India is on account of:

• Ideological differences and lack of proper
participation
• Multiplicity of participate firms leading to duplication,
redundancy and wastage of time
• Industrial relations marked by lack of trust between
the management and employees
• Improve attitude and lack of awareness among
employees

Quality Circles
• The main objectives of QCs include development and

effective utilization of human resources
• Improve quality of services and products
• Satisfying worker’s urge for participation
• Cost reduction
• Improve employee morale
• Resolving problems in work environment
• Various levels in organization include leader, Dy.
leader, facilitator,. Steering committee members

Chapter 16
Managing Employee Safety and

Health

Chapter Objectives
• Concerns about employee safety and health

•Various safety programs and their evaluation
•Supervisors role in work place health and safety
•Various health related problems and remedies
•Environmental legislation on health and safety

Need for safety
• Every employee is crucial

•Safety and protection of employees carries greater financial
implications
•Creates a ripple effect that can influence immediate and
long-term costs
•Helps in maintaining employee motivation
•Reduce scope for industrial unrest

Integrated safety and health management
systems
•Are safety efforts primarily reactive to complaints or
accidents
•Does the management or staff address safety issues one by
one
•Is safety awareness a concern of few
•Risk identification begins with situational assessment and
analysis of gap, based on the following aspects:
–Employee selection, assessment and placement
–Orientation and training
–Inspections
–Incident reports, investigation and analysis
–Work rules, procedures and permits insurance and
claims management
–Communication and promotion

Evaluation of health and safety
programs
• The four elements of evaluation are:
•Management commitment and employee involvement
•Work-site analysis
•Hazard prevention and control
•Health and safety training

Evaluation of health and safety
programs
• Some of the basic questions to ask during employer and
employee interviews are:
–Are the objectives clearly stated
–Is the Programme comprehensive
–Are basic safety rules specified
–Are disciplinary rules enforced when safety guidelines
are not complied with ?

Chapter 17
Knowledge Management (KM)

Chapter Objectives
• Nature and sources of knowledge

–Various approaches to Knowledge Management (KM)
–Process involved in managing knowledge workers
–Relationship between performance planning & Knowledge
Management (KM)
–Impact of organization culture and learning on
performance
–Innovation management in the context of IT

Change Scenario
• Globalization and its impact on HRD

–Evolution of global market place
–Technological revolution
–Change in employer – employee relations
–New environment

Knowledge Management
•Knowledge: Fact / Condition of knowing something with
familiarity gained through experience / association.

Sources of Knowledge:-
•Export
•End User
•Multiple experts
•Literature

Importance of Knowledge
– Foster innovation by free flow of order

– Improving customer service
– Boost revenues by getting products / services to
market
– Enhance employee retention by recognizing their
values and reward them.
– Streamline operations and reduce costs by
streamlining redundant processes

Need for Knowledge Management (KM)
– Increased competition
– Need to be responsible to customer
– Reduced workforce size
– Less time availability for employee for learning
– Processes like BPR, TGM, etc. have only improved
efficient
– Capture knowledge with employees
– Aspects to be taken care by Knowledge Management
– Knowledge aspects

Approaches to Knowledge Management
•Cultural / Behavioral
•Systematic
Characteristics of Knowledge Workers
– They are eager to perform and expect measurement of

actual performance
– Expect demands based on their knowledge
– Require performance orientation item authority
orientation

Chapter 18
HR Accounting & Audit

The chapter deals with
– Importance of assessing HR practices in

organizations.
– Conceptual backdrop of HR Accounting
– Processes and procedures in HR Audit
– Balance score-card method

HR Audit
– It is the systematic assessment of an organization’s
HR service excellence. The HR Audit helps
organization to:-
– HR Programme that helps in achieving
organization objectives.
– Assess the efficiency of HR Department in
implementing these programs.
– Benchmarking HR work to ensure continued
improvement.
– Promote change and creativity.
– Re-direct the focus of HR staff on important issues.
– Align HR with line functions of organization

HR Accounting
• HR Accounting is an Info System that tells
management what changes occurring in HR
Department over a period of time.
• Organisations can access the earning potential
of human capital.
• Indian companies which implemented include
BHEL, Infosys, etc.
• Sophisticated investment by Indian
companies in defining and implementing
various processes / systems for 3 main aspects
is comprehensive, commitment and culture.

HRD Audit
Advantages:-
• Helps organization to assess current position

• Areas of improvement
• Systematic review of all HR functions.
• Linking HR strategy with capable strategy
• Improving competency and functional efficiency of HR
systems

HRD Audit Process
• It is a comprehensive process, involves
understanding of future business and
corporate strategies of organization. Some
question being raised one:-
• What is the 5 / 10 year plan of organization.
• Competencies needed to actualize the plans.
• Current levels of organizational efficiency /
productivity etc.
• Are HR systems designed with organizational
requirements.

HR Practices & Organization
• Good HR practices can drive the growth of

organizations. Some of the benefits are
• Capability to cope with leadership change
• Ability to exploit opportunities.
• Becoming customer oriented and quality conscious
• Into emerging organizations
• Try and developing the employees

Reasons for HRD Audit
• Making HR functions business driven

• Evaluating HR systems vis-à-vis organizational
requirements.
• Improving productivity & efficiency
• Supporting growth / expansion plans.
• Preparing top management to set strategic / long term
goals

Methodology of HRD Audit
• Interviews with CEO, HR Chief, Functional Head, Line
Managers, Employees, etc.
• Auditors capture macro picture and relate with
feedback during audit process.
• Auditors to study physical layout, work ….., working
conditions, etc.
• Selecting cross-functional terms for authentic feedback.
• The primary methods are:-
o Interviews (individual / group)
o Workshops
o Questionnaire
o Observations

Challenges of HRD Audit
– Building and employee quality consciousness
– Attract and retain talent
– Align business process with IT Architecture
– Nurturing creative and supportive work culture
– Train and develop people.

Scope of HR Audit
– Review compliance with laws / regulations

– Install confidence in HR Dept. among employees.
– Enhance organization reputation

HR Audit Process
• Audit Info:- Acquire and review HR records

• Pre-audit assessment with questionnaire
• Onsite review
o Records review
o Audit report

Using of Audit Findings
• Use Hr Audit as blue-print/action plan for addressing

HR needs.
• Address HR needs with internal resources / expertise.
• Outsource where expert is not suitable

Modules of HR Audit
– Recruitment and selection assessment module

– Performance Management module
– Compensation Management module

Limitations of HRD Audit
– Readiness to accept negative feedback and act on

it.
– Should not use to evaluate individuals but systems
and procedures

Balance Score Card
– It provides feedback for strategy implementation

– It is a performance measurement system
– Steps involved include
– Defining objectives at Corporate level
– Linking Corporate objectives with business
– Linking business objectives with critical processes


How to build a Business Score Card
– Identifying strategies
– Identifying tactical objectives
– Identifying performance measurements
– Data sources for calculating performance
measurements
– Data warehouse to supply data

Balanced Score Card strategic initiative
It is used for:-
– Strategy clarification
– Communication of strategic objectives
– Planning and aligning strategic initiatives
– Learning from feedback
– Helps in building MIS

Chapter 19
LEADERSHIP, VALUES AND

CORPORATE SOCIAL
RESPONSIBILITY
Definition
 Leadership is basically a personal quality which
motivates individual to follower leaders.
 Leader tries to influence individuals to behave in

a particular manner
 Relationship between leader and individual –

arises out of common goal
 Leadership is a situational

Leadership Theories
There have been various theories by researchers,

behavioral scientists. Some of the important
approaches towards leadership are:
 Trait Approach
 Behavioral Approach
 Situational Approach
 Eclectic Approach

Group and Exchange Theories of
Leadership
 Fiedler’s Contingency Model of Leadership

Effectiveness
 Path-goal Leadership Theory
 Charisma: A Relationship between the Leader and the

Group Manager

Managerial Grid
One of the most widely known approaches of leadership
styles is the managerial grid developed by Blake and
Mouton. The grid identifies four leadership styles based
on two factors found in the organization i.e. Task and
People Orientation:
 Country Club Orientation

 Impoverished Orientation
 Team Orientation
 Task Orientation

Successful Vs. Effective Leadership
• An effective leader can impact the behavior of his
followers.
• Success defines and determines the behavior of
individuals/groups
• Effectiveness describes the internalship or
predisposition of individual or group, which is
essentially attitudinal in nature.
• Success or Effectiveness is not either or proposition
but is more on a straight-line continuum.

Leadership Skills
Leadership skills and practices recognizes the importance
of skills and how the leader behaves and perform
effectively. The list of critical leadership skills are:
 Cultural Flexibility
 Communication skill
 HRD skills
 Creativity
 Self management of learning

Ten Important Skills of Leaders
1. Verbal communication (including listening)
2. Managing time and stress
3. Managing individual decisions
4. Recognizing, defining, and solving problems
5. Motivating and influencing others
6. Delegating
7. Setting goals and articulating a vision
8. Self awareness
9. Team building
10. Managing Conflict

The Entrepreneurial Leadership Style
Entrepreneurs and intrapreneurs often use a leadership
style that
 Strong achievement motive

 High degree of enthusiasm and creativity
 Tendency to act quickly when opportunity arises
 Constant hurry
 Visionary perspective
 Dislike of hierarchy and bureaucracy
 Preference for dealing with external customers

Management by values
 Values also called a ‘Gunas’ indicate the mental
contents of a good persons and are called as moral and
ethical values
 Some of the qualities are fearlessness, courage, purity
of mind, heart integrity of thought , action and
behavior, generosity, empathy, love and affection,
forbearances, control of mind etc.
 Bhagavad-Gita stresses on the importance of moral
values.
 Values serve the process of transforming the level of
consciousness to pure higher levels.

Indian Ethos for Management
• India has rich cultural lineage in the form of
‘Upanishads, Vedas, Gitas, Smruthis, Puranas etc.
• Indian ethos emphasis on both human and ethical
values
• Knowledge per se, is not power but character is a real
power and wealth.
• Values need to be clubbed with skills.
• Some of the salient ideas and thoughts of Indian ethos
are:
– Atmano mokhardham, jagat hitaya cha
– Aacheyet dana manabhayam’Yagah kamasu
kaaushalam; satvam yoga nehyate
– Parasparam bhavayantah sreyah param
bhavapsyathah
– Parapar dvo bhav
Value Systems – Past and Present
In the consumerist and competitive world, where

achievement is stressed upon, values and ethics have
taken a beating. All of us are going through the ethical
dilemma of:
 Balancing the physical craving with eternal values

 Upholding integrity and self respect against sub-
surveyance to worldly matters.
 Peter and Waterman (1982) gave a crystallized list of
best American companies.

Corporate Social Responsibility (CSR)
Corporates similar individuals are citizens of the society in
which they exists and hence there is a need for them to be
socially responsible.
 CSR is concerned with the relationship of enterprise with

various stake holders
 Involves establishment of dialogue between the enterprise
and stake holder
 Need for upholding of values and ethics by the corporate
leaders
 Dilemma between Social Responsibility Vs. Business
Reality – need to balance


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Human Resource Management All rights reserved

©Oxford University Press, 2006

Nature and Concept of HRM

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Human Resource Management All rights reserved

• HRM refers to acquisition, retention, motivation and

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Human Resource Management All rights reserved

• People – core strength of an organization

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• Growth of public sectors

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Influence of IT along the following dimensions:

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Human Resource Management All rights reserved

• Developing leaders in an organization

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• Facilitating the change process

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Human Resource Management All rights reserved

HRM in a Dynamic Environment

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Human Resource Management All rights reserved

Human Resource Management All rights reserved

• Clarity in the functions of HR

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Source : World Trade Organization.

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• Managers need to think strategically and in futuristic terms

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• Command and compliance

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Human Resource Management All rights reserved

Human Resource Management All rights reserved

Human Resource Management All rights reserved

Human Resource Planning

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HRP is determining the future HR requirements and

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Human Resource Management All rights reserved

Human Resource Management All rights reserved

• Lack of skilled resources/obsolescence

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Human Resource Management All rights reserved

• Focus on the vision

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• Forecasts are of two types: Demand forecasting and supply

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• Determination of appropriate business factor that relates to

Human Resource Management All rights reserved

• Succession planning/career plans

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• Recruitment and retention plans

• Selection and promotion plans

Human Resource Management All rights reserved

Human Resource Management All rights reserved

• Job analysis is a systematic process of gathering information

Human Resource Management All rights reserved

• Establish the job- relatedness of employment procedures

•Facilitate selection of appropriate Human Resource

•Indicates training needs

•Provide information to conduct salary surveys

•Provide a basis for evaluating performance