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Human Resource Management Practices

[Under the course: Human Resource Management]
Submitted By:
Bishnu Prd Neupane MBA III Trimester/2010 Batch School of Business, Pokhara University

Submitted To:
Deepmaala Shrestha Course Instructor, Human Resource Management

Pokhara University
March 13, 2011 This paper is prepared for a seminar presentation on Human Resource Management practices in Nepali Business Organizations in School of Business, Pokhara University MBA third Trimester.

Contents Acknowledgement Preface HR Practices in Nepal 1. Introduction: Charak Hospital 2. Vision & Mission of GMC 2.1 Vision 2.2 Mission Statement 2.3 10 Years Mission of Gandaki Medical College 2.4 Service 3. Current Trend of HR Polices in Nepal vs. Charak Hospital 3.1 Job Design and Job Analysis 3.2 Human Resources Planning 3.3 Recruitment and Selection 3.3.1 Recruitment 3.3.2 Selection 3.4 Training and Development 3.5 Effectiveness of Training 3.6 Performance Evaluation 4. Conclusion, Summary and Recommendation 4.1 Summary 4.2 Conclusion 4.3 Recommendation 4.3.1 Recommendation for further study 4.3.2 Recommendation for Charak Hospital Page No. i ii iv 1 2 2 2 3 3 5 5 6 6 6 6 8 9 9 11 11 11 12 12 12

It is my great pleasure to express my deep gratitude to Human Resource Management course instructor Deepmaala Shrestha, Pokhara University who provided me the opportunity to directly face the corporate world. It was really an interesting task to perform practically what I studied in the book. Frequently visiting such organizations made me more confident and mature to deal with the prevailing human resource issues. I am grateful to Mrs. Rama Timilsina, Human Resource Manager Gandaki Medical College and Research Center, Charak hospital who provided an opportunity to understand the contemporary HR practices in Charak Hospital as well as in the world. I also want to thank all the staffs of Charak Hospital and Research Center who helped us directly or indirectly in the completion of my project. I cant stay without thanking my friends and family member who encouraged and supported me to complete this project work, especially Mr. Rishabh Gautam, Mr. Pradeep Sapkota, Mr. Nitesh Shrestha and Mr. Anil Gupta. The project is the result of their pursuit for excellence.

Bishnu Prasad Neupane MBA Third Trimester School of Business, Pokhara University


Human resource management is the new version of personnel management in the age of neoliberalism and market economy. In this competitive age, HRM is emerging as more strategic in nature to achieve a competitive advantage. Whether an organization is service-oriented or manufacturing, it is important to respect and use its human resources in order to achieve this advantage in these times of increasing challenges and opportunities in the corporate world. It is not so easy to manage human resources because they are people who manage other resources. Realizing this fact, my field visit aims to deal with HR dimensions in organizational settings imperative for the strategic use of the organizations resource to secure a competitive advantage. Many Nepalese organizations hesitate to give information related to human resources within the organization. Same thing happened to us. Firstly I chose one of the renowned manufacturing companies of Nepal situated in Pokhara for my project. But later, I had to change the organization for my project since they hesitate to provide information about HR practices inside their organization. I visited the organization frequently in a month but Ire unable to get good response from the HR managers. What I learned from this is- most of Nepalese organizations are still not practicing HR management practices, they dont have proper knowledge on responding people. They are in the phase of introducing HR management in their organization. I felt that profit motive organizations do not have culture of responding others in a Ill manner, they only think of increasing profit which may not be good enough for the society. The second organization I chose to visit for my project was quite better in the sense of Corporate Social Responsibility. I didnt have to face obstacles just to meet with HR manager and get information about HR practices in the organization. HR manager of Charak hospital has good communication skill and friendly behavior interviewing with her was really a new and significant for us. Hospital was a new place for us since most of the business students choose manufacturing companies and financial institutions for their project. I get exposed to real situation, far from imaginary bookish knowledge. I am again very much thankful to my course instructor for creating such an opportunity. I found service motive organizations have good relations with public and good culture of responding others, but this lacks in profit motive organizations.

Bishnu Prd Neupane

Human Resource Management (HRM)

Human Resource Management (HRM) is the strategic and coherent approach to the management of an organization's most valued assets - the people working there who individually and collectively contribute to the achievement of the objectives of the business. The terms "human resource management" and "human resources" (HR) have largely replaced the term "personnel management" as a description of the processes involved in managing people in organizations. Human Resource management is evolving rapidly. Human resource management is both an academic theory and a business practice that addresses the theoretical and practical techniques of managing a workforce. The Human Resources Management (HRM) function includes a variety of activities, and key among them is deciding what staffing needs you have and whether to use independent contractors or hire employees to fill these needs, recruiting and training the best employees, ensuring they are high performers, dealing with performance issues, and ensuring ymy personnel and management practices conform to various regulations. Activities also include managing ymy approach to employee benefits and compensation, employee records and personnel policies. Usually small businesses (for-profit or nonprofit) have to carry out these activities themselves because they can't yet afford part- or full-time help. However, they should always ensure that employees have -- and are aware of -- personnel policies which conform to current regulations. These policies are often in the form of employee manuals, which all employees have. According to Piper, HRM can be defined as consisting of the following elements :traditional personnel administration (staffing, rewarding , work design) ; personnel development ; a specific management philosophy that values labor as the major asset of an organization and that regards human being as being able and willing to grow and develop; and the integration of the personnel function into strategic management According to Decenzo and Robbins HRM is comprised of comprised of the staffing development, motivation and maintenance of function.

Human Resource Management Practices in Nepalese organization

In Nepal, human resource management is not practiced in most of the organization. There are very few organizations which have human resource department. But these days organizations are creating a human resource department (HRD) as a pure department which only focuses on hiring, maintaining, developing and firing human recourse within the organization. In Nepal personnel is still preoccupied with record keeping and very few organization undertaking HRM concept. Researches show that there has been no significant change in the HR polices taken by the Nepalese organization. Human recourse management is that the people working in the organization are viewed as a valuable resource. Industrial revolution in Nepal started with the setting up of Biratnagar jute mill in 1936. The pace of industrialization has been slow. The establishment of public seeker manufacturing enterprises did accelerate this pace to some extent however; HRM remained mainly confined to personnel administrative and labors functions. The legal framework represented by labor Act 1992, trade union Act 1993 and child labor Act 2000, gave personnel manage orientation of HRM in Nepal.

Nepalese organizations do not give much attention to developing their managers to assume greater responsibilities in the future. Some private consulting firms and management association of Nepal conduct short term program for managers. The methods of management development are coaching and understudy assignments. Job rotation is not used. Off-the-job management development methods are largely lecture oriented. Behavioral techniques are little used. Conflict in Nepalese organizations is mostly personality-based. It lacks issue-organizational conflicts are widespread due to the importance of informal poIr centre in organizations. Interdepartmental conflicts also arise due to the lack of systems-orientation. Departmental managers tend to be concerned about the interests of their own departments. Human Resource Management is a new concept for Nepalese organizations.

Labor legislation in Nepal

Nepal had no effective labor legislation till 1959. The important legal landmarks are: 1. Labor act 1992 (as amended in 1998):It is the first labor law of Nepal. And it is amended three times. important provision: a) Payments of wages, overtime and minimum wages to workers, Workers rights to form union, tribunal to settle disputes. b) Provident fund provision for permanent workers, work committees to harmonize labor relations. c) Leaves, working hmys, Pension, Maternity benefits, Compensation for injury/disability/death, Medical facility, Rest room & children Employment of foreign citizens, right to strikes and lockout. d) Employment and job security, firing of workers, Remuneration yearly pay increment 2. Bonus act, 1974:The amount of bonus to an individual will depend on the amount of monthly salaries and wages paid, but shall not exceed six months wages and salaries. 3. Trade union act, 1993:It provides legal trade union in the organization. At least 25% of the total workers should constitute to the leader. They improve the work condition & progress of the workers, good labor relation, dutiful & discipline. To find out how human resource management is being performed in Nepalese organizations, I have been to Gandaki Medical College Teaching Hospital & Research Center Pvt. Ltd. Pokhara, Kaski. Based on the interview with Human Resource Manager Rama Timilsina and information provided by her, I prepared this paper. arrangements, It has following

Gandaki Medical College Teaching Hospital & Research Center Pvt. Ltd. Charak Hospital, Pokhara, Nepal 1. Introduction:
Charak hospital and research center Pvt. Ltd. With 300 bed capacity located in Prithivi Chowk, Ward no.9 of Pokhara Sub-metropolitan City is owned and managed by GMC Pvt. Ltd. as its City hospital. Gandaki Medical College Teaching Hospital & Research Center Pvt. Ltd. (GMC) is a health educational institution located in Kaski district of Nepal. It deals with a national priority industry for a medical college and teaching hospital. It is purely Nepalese ownership. The primary concern of GMC is to develop through education and training, compassionate, professionally excellent, ethically sound individuals who will go out as leaders in the delivery of promotive, preventive, curative, rehabilitative and palliative aspects of health care as well as in education and in research. Briefly1. GMC is located at Pokhara. Hospital and other academic buildings will be constructed in an area of about 200 Ropani (1 Ropani = 5625 square feet thus 11, 25,000 square feet) of land. These lands are in less than 3 pieces and are less than 10 km apart. 2. The project is founded on its own land. The locations have sufficient land to satisfy the mandatory requisites of the affiliating university and the professional council. The construction of buildings and civil works and installation of equipment is projected for completion by the end of 2014. 3. The project will attract students and patients from Nepal, India and other SAARC countries, which will boost the other economic activities in the region. 4. The project is expected to generate revenue of Rs.25 crores by the end of 2010, its first year of operation. This is expected to reach Rs. 80 crores in 10th year at full capacity. Charak Hospital has crossed a long way, established as a small hospital at Dam side, it shifted and expanded in Sanchaya Kosh Bhawan at Prithivi Chowk, Pokhara, Kaski. Gandaki Medical

College. According to the data provided by HR manager, about 550 employees are working there in the hospital at Prithivi Chowk, Pokhara and its medical college in Lekhnath Municipality. In the delivery of health care, Charak hospital with its 300 beds is providing high standard health services to the community in affordable prices. Patients benefit is our purpose and pride With this motto charak hospital is committed for the promotion of health of the individuals and community. Different awareness campaigns and programmes are being conducted in behalf of the society. The hospital is careful about the social corporate responsibility. Weekly live radio talk show in health awareness is aired in Pokhara FM 95.8 MHz at 20:00 to 21:00 Hours. This hospital is actively involved in regular health camps, blood donation campaigns too.

2. Vision & Mission of GMC:

2.1 Vision To become the first choice learning institute for medical education and health care delivery. 2.2 Mission Statement Be the leading medical college of Nepal and the most patronized health care facility by all sections of society, especially of the western development region. This is possible due to the core qualities of the companys: 1. Visionary leadership 2. Committed and competent staff 3. State of the art technology 4. Integrity in adherence to regulatory standards 5. Exemplary corporate governance Its leadership has visions beyond present state. This will promote health, education and tourism for Pokhara and thus encompass all the priority sectors of this country and region. Its staff is committed and full time. They too share the same vision as the promoters. They know

that there is no substitute for quality and they understand this concept and have invested in latest technology. They need to adhere to all the regulatory standards of Education and Health Ministry, University and Nepal Medical Council. We adhere to the standards of corporate governance as we are accountable to our investors and have a very strong social responsibility towards our native region.

2.3 10 Years Mission of Gandaki Medical College

Year/Program 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

MBBS BDS 0 75 75 100 100 100 150 150 150 150 150 0 0 40 40 40 40 40 40 40 40 40

BSc Nursing B Pharma BSc MLT 0 40 40 40 40 40 40 40 40 40 40 0 40 40 40 40 40 40 40 40 40 40 0 40 40 40 40 40 40 40 40 40 40

Total Hospital Bed 100 300 300 500 500 750 750 750 750 750 750

There are mainly four departments in Gandaki medical college for effectively providing services to general public. I. II. III. IV. General Out-Patient Department (OPD) Academic Department Diagnostic Service Department Clinical Service Department

I. General out-Patient Department (OPD) Patients are seen on the first come first service basis (FCFS). However, out of turn consultation may be provided in case of emergency or to senior citizens. People have right to consult any doctor/ consultant on their OPD days. For seeking appointment with particular consultant in their non-OPD days, patient may contact his or her office. II. Academic Department GMC is conducting various programs in Medical and Allied Sciences. It has been publishing its quarterly academic journal, daily continuing medical education (CME) program from 1400-1500 hrs at Naya Bazaar, Pokhara. It has one central and departmental library with books, journals and periodicals of medical and other allied health sciences. III. Diagnostic Service Department GMC is providing laboratory, Radio-Diagnostic services, Cardiology and Pulmonary Medicine, & Endoscopy suite Services. It has one Emergency Lab and one a Routine Lab. IV. Clinical Service Department GMC- Charak Hospital currently has 35 specialist doctors and 24 non-specialist Medical Graduates providing quality services to the community through 11 departments in the hospital. The hospital is rapidly growing in status and stature.

3. Current Trend of HR Polices in Nepal vs. Charak Hospital:

3.1 Job Design and Job Analysis Job design is concerned with improving the conditions of personnel participation in the work situation with the aim of releasing human resources. If job is less rewarded and non- motivating, it will have negative impact on human elements. There are useful criteria for evaluating jobs on the one hands, and for designing jobs on the other. It is clear that job design is an essential tool of HRM to increase productivity and work quality. Job analysis is the term used to describe the process of analyzing a job or occupation into its various components, that is, organizational structure, work activities, and informational content. The process results in a relevant, timely and tailored database of job-related information that can be used in a variety of ways: to develop conventional, individualized, computer-based and/or critical incident education and training programs and materials; to create and classify job titles; to write job descriptions; to prepare organization charts; to conduct time and motion studies; to determine quality assurance standards; and to write both knowledge-and performance-related employee evaluation measures. Charak Hospital also follows the same process of job design and analysis.

3.2 Human Resources Planning Human Resources Planning (HRP) are the process by which an organization ensures that it has right number and kinds of people at the right places, at the right time, capable of effectively and efficiently completing those tasks that will help the organization achieve its overall objectives. It is the Utilization of human resources in cost effective and efficient manner and determination of the internal supply and external supply of human resources. Charak hospitals HR planning starts from the needs as well as the strategic objectives of the hospital and an analysis of the human required achieving them. HRP involves forecasting human resources needs for organization and planning the steps necessary to meets these needs The Nepalese organization in banking, hospitality and manufacturing sectors in Nepal do prepare systematic HRP. This will definitely have a positive

impact for HRP in Nepalese organization in coming year. The HRP function in Nepalese organization needs strengthening the present tendency of dumping unwanted employees in the planning division should be replaced by the posting of competent professionals. 3.3 Recruitment and Selection 3.3.1 Recruitment: Recruitment is that set of activities an organization uses to attract job candidates who have the abilities and attitudes needed to help the organization achieve its objectives. It involves the searching for and obtaining qualified job candidates in such numbers that the organization can select the most appropriate person to fill its job needs. It is the process of attracting a pool of candidates for a vacant position. Since there are not so much competitions in health care sector for candidates to get job, Charak hospital does not have to face crowd of applicants in comparison to other sectors. Recruitment is an important aspect of HRM in Nepal. Employment opportunities are rather limited because of poor economic growth and slow pace of industrialization. Organization do not face problem in attracting a large pool of prospective candidates to fulfill their human resource needs. Sources of Recruitment Sources 1 Internal (within the organization) External 2 (outside the organization) Employment exchanges Educational Institution Placement Employee Referrals Walk-ins/ write-ins/ Electronic search Trade unions Labor contractors Job Posting Employee Referrals Human Resources Inventory Methods

3.3.2 Selection Selection is the final stage of recruitment process. Recruitment is the process of attracting a pool of qualified candidates and selection is the technique of choosing new member of the organization from the available candidates. It is the process concerned with the evaluation of candidates and the development of system, procedures and methods to ensure that sound selection decision are made to ensure that high quality personnel are brought into the organization. The selection process in Charak Hospital consists as follows; 1. 2. Application forms are evaluated. Selection tests are administered (written test ) but Charak Hospital does not focus on written exams as a best tool of selection. 3. Selection interview is held, referral of high posts person works in Charak hospital. Ex; an MBBS candidate gets more chance of selecting if he/she is referred by some high posts doctor. In interview they ask about background of the candidate, reasons why he/she want to involve with Charak and it depends upon the levels or posts. Through interview they trace attitude, behavior and psychometric measures of employee. There is no special tool practiced in this organization than interview. Background check is done only by asking the candidate. 4. 5. Hiring decision is made. Sometimes they select new employees from the forms they got earlier vacancies and solicited applications.

In the contest of Nepal, in the process of selection The role of source and force is important in the selection of candidates, especially in public sector enterprises. The selection of candidates in the unorganized private section is based on the subjective judgment of the owner. Personal relationships count most in selection. Placement in government and public enterprises tends to be defective. The private sector generally places right person in right job.

3.4 Training and Development Training seeks to improve ability to perform present jobs. It is skills oriented generally given to operative employees who do not supervise the activities of other. It is remedial in nature. Development seeks to improve experience to handle future challenges and responsibilities .it is education oriented and given to managerial employees who supervise the activities of other .it is also called management development or executive development technological changes are making the jobs more complex and demanding .organizations needs to raise skill levels and make their employees versatile and adaptable both through training and development. Human Resource Development (HRD) needs are not properly identified by Nepalese organizations. Training is not a continuous activity. The widely used method for determining training needs is supervisory recommendations. Most Nepalese organizations lack training need survey and performance task analysis to identify training needs. HRD has remained an area of the least priority in Nepals human resource management. Charak Hospital provides training for new employees. The training depends upon the type of job. They provide educational trainings and skill-based trainings. If institution feels, an employee can get sponsorship for further study in Nepal and also abroad. Employee becomes aware of personal skills, interest, knowledge motivations and other characteristic; acquires information about opportunity and threats, identifies career related goals and established action plans to attain specific goal. This leads to careers development of a person. GMC uses a mix of on-the-job and off-the-job training methods. On-the-job training orientated apprenticeship and internship methods are used for skills and professional jobs. Off-the-job training methods are overwhelmingly lecture conference-oriented. Experiential exercises are little used for training. 3.5 Effectiveness of Training:The evaluation of training is generally based on reaction and learning criteria. Behavior and results criteria are generally not used to evaluate training effectiveness. (Trainee surveys constitute the widely used method for evaluating training.)

3.6 Performance Evaluation Supervisor are always judging the performance of their subordinates and providing suggestions for improvement. These are the subjective way of appraising the performance. A Process whereby managers and their subordinates share understanding about what has to be accomplished and managers will naturally be concern about how best to bring about those accomplishment by adept management and development of people in the short and long term. It is clear that without having a clear understanding between superior and subordinates at the

time of setting above it is difficult to appraise performance appraisal is also known as performance review, performance evaluation, merit rating, employee appraisal is the basic tool for evaluating job relevant strengths and weaknesses within and between employees with a view to operate effective performance management system in the organization. Current performance-oriented: Performance evaluation has not received adequate attention in Nepals human resource management. It is largely confined to appraising current performance on the job. It is not much concerned about the employees potential for assuming future responsibilities. Informal and subjective: Most of the private sector enterprises in Nepal lack systematic performance appraisal system. Personal judgment and subjective assessment of owner-manager serves as the key criteria for performance appraisal. Large size public limited companies, international NGOs, and multinational enterprises do have systematic performance appraisal system. But in many cases the implementation of the system is not effective and objective. Most organizations lack proper standards against which performance can be appraised. Promotion-oriented purpose: The main purpose of performance evaluation in Nepalese organization is the promotion of employees. It does not provide performance feedback to employees. Nor is it used as a basis for reward management or identification of training and development needs.

Lack of transparency: Performance appraisal in Nepal lacks transparency. The performance standards are not properly communicated to employees. Performance appraisal is not discussed with the employee, so that performance appraisal does not initiate corrective actions. In civil service, 40% of performance appraisal is confidential and non transparent to employees.

In Charak hospital, It is interesting to find out that the main factor for promotion is the view of coordinates on a particular person and how much the others praise his/her performance. The person who is mostly praised by others has more chance to get promoted but the praise should be the efficiency and the effectiveness of performance as well as the friendly behaviors of the person.

4. Summary, Conclusion and Recommendation:

4.1 Summary The Human Resources Management (HRM) function includes a variety of activities, and key among them is deciding what staffing needs you have and whether to use independent contractors or hire employees to fill these needs, recruiting and training the best employees, ensuring they are high performers, dealing with performance issues, and ensuring your personnel and management practices conform to various regulations. Activities also include managing your approach to employee benefits, employee records and personnel policies. HRM increases employee commitment as well as their ability and competence to work effectively in the organization.

HRM plans education, training and development of the employees to upgrade their knowledge, skill and decision making capacity to adept change. In this world of competition, there is no place for the organization which fails to adept to the changing circumstances. 4.2 Conclusion Human resources in Nepalese organizations have remained grossly underutilized. This is mainly due to the lack of systematic human resource development plans, policies and practices. Moreover, proper incentive is also lacking to motivate employees to voluntarily join training program. The mentality of Nepalese employees is also to go for foreign training by hook or by crook. Such trainings tend to be subsidized tourism under the auspices of foreign-aided projects and program. Above all, top management support and commitment is lacking for training and development in Nepalese organization.

4.3 Recommendation
4.3.1 Recommendation for further study: There is long way to go in human resource management practices in Nepal. Conducting various projects on HR sector creates a new wave among Nepalese organizations which will lead to prosperous Nepal. Placing right person at right place in right time is very important, not only from the lens of a HR manager, not an executive, not a leader; but also the whole world can be benefited by best HR practices. So, everyone should start acting from a small organization to the global business considering HR factors. We recommend researchers to explore on new effective and efficient way of managing human resource in developing countries like Nepal. It is necessary to further research on effectiveness of employee who is selected from psychometric tests.

4.3.2 Recommendation for Charak Hospital: Health care sector is very much sensitive and it matters to everyone in the society. Charak hospital is one of the emerging and developing as a new hope for not only Pokhareli people but for whole Nepal. We found the hospital is committed for the promotion of health of the individuals and community. It is planning to establish 450 bedded teaching hospitals at Lekhnath Municipality-2, Kaski. So hiring new employee is again an important task for HR manager. HR department should consider the trends and also analyze the shortcomings of such trend, and overcome it. For excellent service, motivation factors and regular training to the employee is the most. Employee in hospital must be committed to serve the people and for this HR department of the hospital should watch every time to its employee. Culture of reward and also punishment

should be there in the organization. Hospitals these days are not so secured for health sector workers since there are many examples of doctors attacked by people. So work security, social corporate responsibility should be practiced effectively. Quality and innovation are largely affected by the skilled, able and motivate manpower. So, human should be considered as the most valuable asset of the organization. It is an important program to ensure that the organization has an institutionalized way of developing, utilizing and committing human resources in order to meet organizational challenges in the present and in the future.

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