Professional Documents
Culture Documents
Human Resource Management - Block 1 PDF
Human Resource Management - Block 1 PDF
Notes
Structure:
1.1 Introduction
1.2 Meaning and Definitions of HRM
1.3 Objectives of Human Resource Management
1.4 History of HRM
1.5 Scope of Human Resource Management
1.6 Features or Characteristics of HRM
1.7 Importance of HRM
1.8 Evolution of Human Resource Management
1.9 Functions of Human Resource Management
1.10 Principles of HRM
1.11 Responsibilities in HRM
1.12 Theories of Management
1.13 Summary
1.14 Check Your Progress
1.15 Questions and Exercises
1.16 Key Terms
1.17 Check Your Progress: Answers
1.18 Case Study
1.19 Further Readings
1.20 Bibliography
Objectives
Human Resources
Human resource can be defined as the translating process of human being into a
useful resource. When a human being contributes his/her skills, knowledge and positive
attitude towards productive work in an organization, he/she becomes the human resource
for that organization.
According to Leon C. Megginson, ‘‘HR is the total knowledge, skills, creative Notes
abilities, talents and aptitudes of an organization’s workforce, as well as the value, attitudes
and beliefs of the individuals involved”.
According to Gary Dessler, “Human resource management is the policy and practice
of one need to carry out the people or human resource aspects of a management position,
including recruiting, screening, training, rewarding and appraising”.
According to Edwin B. Flippo, “Human resource management refers to the planning,
organizing, directing and controlling of procurement, development, competition, integration,
maintenance and separation of human resource to the end so that individual, organizational
and social objectives are accomplished”.
According to C.D. Risher and L.F.Schoenfeldt, “Human resource management
involves all management decisions and practices that directly affect or influence the people
or human resources, who work for the organization”.
Notes positions, rights and duties, accountability and responsibility and other working
relationships. The human resource management system provides required information too
timely and accurately. Hence, human resource management helps to maintain
organizational structure.
3. To develop human resources
Human resource management provides favorable environment for employees so that
people working in organization can work creatively. This ultimately helps them to develop
their creative knowledge, ability and skill. To develop personality of employees, human
resource management organizes training and development campaigns which provide an
opportunity for employees to enhance their caliber to work.
4. To respect for human beings
Another importance objective of human resource management is to provide a
respectful environment for each employee. Human resource management provides with
required means and facilitates employee along with an appropriate respect because the
dominating tendency develops that will result organizational crisis. Hence, all of them
should get proper respect at work. Human resource management focuses on developing
good working relationships among workers and managers in organization. So, good human
resource management system helps for respecting the employees.
5. To maintain goal harmony
Human resource management bridges the gap between individual goal and
organizational goal-thereby resulting into a good harmony. If goal difference occurs, the
employees will not be willing to perform well. Hence, a proper match between individual
goal and organizational goal should be there in order to utilize organizational resources
effectively and efficiently.
6. To ensure employee satisfaction
Human resource management provides a series of facilities and opportunities to
employees for their career development. This leads to job satisfaction and commitment.
When the employees are provided with every kind of facilities and opportunities, they will
be satisfied with their work performance.
7. To ensure employee discipline and moral
Human resource management tries to promote employee discipline and moral
through performance based incentives. It creates a healthy and friendly working
environment through appropriate work design and assignment of jobs.
8. To increase organizational productivity
Human resource management focuses on achieving higher production and most
effective utilization of available resources. This leads to an enhancement in organizational
goals and objectives.
1900s, which developed in response to the demand for ever more efficient working practices Notes
within highly mechanized factories, such as in the Ford Motor Company. By 1920,
psychologists and employment experts in the United States started the human relations
movement, which viewed workers in terms of their psychology and fit with companies,
rather than as interchangeable parts.
During the middle of the last century, larger corporations, typically those in the United
States that emerged after the Second World War, recruited personnel from the US Military
and were able to apply new selection, training, leadership, and management development
techniques, originally developed by the Armed Services, working with, for example,
university-based occupational psychologists. Similarly, some leading European
multinationals, such as Shell and Phillips developed new approaches to personnel
development and drew on similar approaches already used in Civil Service training.
Gradually, this spread more sophisticated policies and processes that required more
central management via a personnel department composed of specialists and generalist
teams.
The role of what became known as Human Resources grew throughout the middle
of the 20th century. Tensions remained between academics who emphasized either ‘soft’
or ‘hard’ HR. Those professing so-called ‘soft HR’ stressed areas like leadership, cohesion,
and loyalty that play important roles in organizational success. Those promoting ‘hard
HR’ championed more quantitatively rigorous management techniques in the 1960s.
In the later part of the last century, both the title and traditional role of the personnel
function was progressively superseded by the emergence, at least in larger organizations,
of strategic human resources management and sophisticated human resources
departments. Initially, this may have involved little more than renaming the function, but
where transformation occurred, it became distinguished by the human resources having
a more significant influence on the organizations strategic direction and gaining board-
level representation.
Notes overall objective here is to ascertain individual growth, development and effectiveness which
indirectly contribute to organizational development. It also includes performance appraisal,
developing new skills, disbursement of wages, incentives, allowances, traveling policies
and procedures and other related courses of actions.
2. HRM in Employee Welfare
This particular aspect of HRM deals with working conditions and amenities at
workplace. This includes a wide array of responsibilities and services such as safety
services, health services, welfare funds, social security and medical services. It also covers
appointment of safety officers, making the environment worth working, eliminating
workplace hazards, support by top management, job safety, safeguarding machinery,
cleanliness, proper ventilation and lighting, sanitation, medical care, sickness benefits,
employment injury benefits, personal injury benefits, maternity benefits, unemployment
benefits and family benefits.
It also relates to supervision, employee counseling, establishing harmonious
relationships with employees, education and training. Employee welfare is about
determining employees’ real needs and fulfilling them with active participation of both
management and employees. In addition to this, it also takes care of canteen facilities,
crèches, rest and lunch rooms, housing, transport, medical assistance, education, health
and safety, recreation facilities etc.
3. HRM in Industrial Relations
Since it is a highly sensitive area, it needs careful interactions with labor or employee
unions, addressing their grievances and settling the disputes effectively in order to maintain
peace and harmony in the organization. It is the art and science of understanding the
employment (union-management) relations, joint consultation, disciplinary procedures,
solving problems with mutual efforts, understanding human behavior and maintaining work
relations, collective bargaining and settlement of disputes.
The main aim is to safeguarding the interest of employees by securing the highest
level of understanding to the extent that does not leave a negative impact on organization.
It is about establishing, growing and promoting industrial democracy to safeguard the
interests of both employees and management.
1. Corporate Level
For an enterprise effective HRM leads to attainment of its goal efficiently and
effectively. HRM helps enterprise in the following ways:
a) Hiring required skill set and retaining them through effective human resource
planning, recruitment, selection, placement, orientation and promotion policies.
b) Development of employees by enhancing necessary skills and right attitude
among employees through training, development, performance appraisals etc.
c) HRM also takes care of optimum utilization of available human resource.
d) HRM also ensures that organization has a competent team and dedicated
employees in future.
3. Social Level
a) HRM plays important role in the society, it helps labour to live with pride and
dignity by providing employment which in turn gives them social and
psychological satisfaction.
b) HRM also maintains balance between open jobs and job seekers.
4. National Level
a) HRM plays a very significant role in the development of nation. Efficient and
committed human resource leads to effective exploitation and utilization of
nation’s natural, physical and financial resources.
b) Skilled and developed human resource ensures the development of that country.
If people are underdeveloped then that country will be underdeveloped.
c) Effective HRM enhances economic growth which in turn leads to higher standard
of living and maximum employment.
Notes A manager’s handling of the human assets reflects his managerial capabilities. Managing
people is one of the biggest challenges for any manager. The functions of HRM can be
classified into two categories which are: 1. Managerial Functions 2. Operative Functions.
1. Managerial Functions
It is checking regulating and verifying whether everything occurs as per the standards set Notes
and plans adopted.
2. Operative Functions
The operative functions of HRM are concerned with the activities specially dealing
with employment, human resource development, compensation and human relations.
(i) Procurement
Through the process of recruitment and selection, the HR manager identifies the right
type of people required in the organization and puts in some efforts to develop to get better
performance.
(ii) Maintenance
Maintenance is one of the important functions to perform in HRD. Human Resources
Management undertakes all the activities contributing to maintaining people in the
organization. For examples, Good environment, different facilities like canteen, rest room,
parking facilities, introducing safety measures to avoid accident, introducing incentives
in the form of extra leaves, remuneration for medical expenses etc.
(iii) Development
Through Training and Development the present and future skills required are imparted
to employees.
(iv) Work Culture
HRM introduces to pattern, the procedures in which the organization carries out its
function. It is this definite way of word that creates a definite work culture in the
organization.
(v) Educating the Managerial Personnel
Personnel Development programmes tries to educate the managerial executive of
the market situations and trends which help in forming new plans and strategies of
products.
(vi) Conducting Research
The main focus of human resource management is to come out with different ways
in order to control and regulate the personnel towards the right direction there by achieving
organization’s objectives. In order to attain HRM it should focus towards coming out with
continuous innovative methods in order to communicate, understand and integrate the
workforce, research plays a pivotal role.
(vii) Developing a Communication System
HRM promotes free flow of communication in organization i.e., upwards, downwards
and lateral, which helps in building suitable environment of work and builds culture link
in the organization.
(viii) Compensation
It is concerned with securing adequate and equitable remuneration to persons working
in the organization. Compensation should be fixed in such a way that it is able to attract
and retain suitable persons in the organization.
(ix) Integration
It is an attempt to effect reconciliation of individual, organization, and social interest.
8. Control: HRM policies and practices must ensure that performance of HR is Notes
consistent with business objectives.
9. Change:The basic premise of HRM strategy must be that continuous
improvement and development is essential for survival.
10. Commitment: The last C stresses upon that employee are to be motivated to
achieve organizational goals.
Process of HRM
Notes (ix) To facilitates the development of various organizational teams and their working
relationship with other teams and individuals.
(x) To diagnose problems and to determine appropriate solution particularly in the
human resources areas.
Qualities of HR Manager
8. Lightness Notes
A stellar manager doesn't just produce outstanding results; s/he has fun in the
process. Lightness doesn't impede results but rather, helps to move the team forward.
Lightness complements the seriousness of the task at hand as well as the resolve of
the team, therefore contributing to strong team results and retention.
9. Discipline/Focus
Discipline is the ability to choose and live from what one pays attention to. Discipline
as self-mastery can be exhilarating. Role model the ability to live from your intention
consistently and you'll role model an important leadership quality.
10. Big Picture, Small Actions
Excellent managers see the big picture concurrent with managing the details. Small
actions lead to the big picture; the excellent manager is skillful at doing both: think big
while also paying attention to the details.
HRM Activities
The various HRM activities are as follows:
1. Leadership
Leadership is stated as the “process of social influence is which one person can
enlist the aid and support of others in the accomplishment of a common task.” Leadership
remains one of the most relevant aspects of the organizational context. However, defining
leadership has been challenging and definitions can vary depending on the situation as
“leadership is about capacity: the capacity of leaders to listen and observe, to use their
expertise as a starting point to encourage dialogue between all levels of decision-making,
to establish processes and transparency in decision-making, to articulate their own value
and visions clearly but not impose them. Leadership is about setting and not just reacting
to agendas, identifying problems and initiating change that makes for substantial
improvement rather than managing change”.
2. Training and Development
It is a learning process that involves the acquisition of knowledge, sharpening of skills,
concepts, rules or changing of attitudes and behaviors to enhance the performance of
employees. Training is an investment because the departments such as, marketing &
sales, HR, production, finance, etc. depends on training for its survival. If training is not
considered as a priority or not seen as a vital part in the organization, then it is difficult
to accept that such a company has effectively carried out HRM. Training actually provides
the opportunity to raise the profile development activities in the organization the
enhancement of the skills, knowledge and experience of employees with the purpose of
improving performance. Employee development, unlike personal development, is usually
coordinated by the employing organization. It can use a variety of training methods and
is usually conducted on a planned basis, perhaps as a result of a performance appraisal.
3. Performance Appraisal
Personnel evaluation method is seeking the measurement of employee work
effectiveness using objective criteria. Performance appraisal systems hope to achieve
higher productivity outcomes by delineating how employees meet job specifications.
Performance appraisal is one of the important components in the rational and systemic
process of human resource management. The information obtained through performance
appraisal provides foundations for recruiting and selecting new hires, training and
development of existing staff and motivating and maintaining a quality work force by
adequately and properly rewarding their performance. Without a reliable performance
Notes appraisal system, a human resource management system falls apart, resulting in the total
waste of the valuable human assets a company has.
4. Staffing
The term staffing may be defined as the managerial function of hiring and developing
the required personnel to fill in various positions in an organization. This function involves
the determination of the size and categories of staff requirement. It is also concerned with
employing the right type of people and developing their skills through training. The staffing
function focuses on maintaining and improving the manpower in an organization. After an
organization’s structural design is in place, it needs people with the right skills, knowledge
and abilities to fill in that structure. People are an organization’s most important resource,
because people either create or undermine an organization’s reputation for quality in both
products and service. Staffing, is the management function devoted to acquiring, training,
appraising and compensating employees .he right staff can carry an organization through
a period of change and ensure its future success. Because of the importance of hiring
and maintaining a committed and competent staff, effective human resource management
is crucial to the success of all organizations.
5. Justice Determination
The quality of being just; conformity to the principles of righteousness and rectitude
in all things; strict performance of moral obligations; practical conformity to human or divine
law; integrity in the dealings of men with each other; rectitude; equity; uprightness.
Generally, maintaining good organizational justice can lead to ideal and favorable
outcomes in the workplace. It is expected that employees will act according to
organizational rules and regulations if they are treating fairly and receive the outcomes
they desire. In research, it has been shown that employees are more committed to the
organization, have more trust and are more satisfied when justice is perceived as being
fair. There is also research that compared organizational justice to various employee
behaviors and elements of interpersonal communication, such as sexual harassment,
ethics, performance, feedback and citizenship behavior
6. Collective Bargaining
Collective bargaining is a process between employers and employees to reach an
agreement regarding the rights and duties of people at work. Collective bargaining aims
to reach a collective agreement which usually sets out issues such as employees pay,
working hours, training, health and safety and rights to participate in workplace or company
affairs. Collective bargaining is process of joint decision making and basically represents
a democratic way of life in industry. It is the process of negotiation between firm’s and
workers’ representatives for the purpose of establishing mutually agreeable conditions of
employment. It is a technique adopted by two parties to reach an understanding acceptable
to both through the process of discussion and negotiation.
7. Organization Development
Organization development is a planned organization-wide effort to increase an
organization’s effectiveness and viability. Warren Bennie, has referred to organization
development as a response to change, a complex educational strategy intended to change
the beliefs, attitudes, values and structure of organization so that they can better adapt
to new technologies, marketing and challenges and the dizzying rate of change itself.
Organization development is neither “anything done to better an organization” nor is it “the
training function of the organization”; it is a particular kind of change process designed
to bring about a particular kind of end result. Organization development can involve
interventions in the organization’s “processes,” using behavioral science knowledge as well
as organizational reflection, system improvement, planning and self-analysis.
Amity Directorate of Distance and Online Education
Overview of HRM 17
The basic them of “Taylor” was that managers should study, work scientifically and Notes
in order to identify “One Best Way” to get the job done. Taylor’s scientific management
is also known as Taylor’s Principles or Taylorism. Taylor’s scientific management
consisted of four principles:
(i) Replace rule-of-thumb work methods with methods based on a scientific study
of the tasks.
(ii) Scientifically select and then train, teach and develop the workman, whereas
in the past the employee (or workmen) chose his own work and trained himself
as best he could.
(iii) Provide “Detailed instruction and supervision of each worker in the performance
of that worker’s discrete task”.
(iv) Divide work nearly equally between managers and workers, so that the
managers apply scientific management principles to planning the work and the
workers actually perform the tasks.
According to Taylor, the summary of the fourth element is: Under the management
of “initiative and incentive” practically the whole problem is “up to the workman,” while
under scientific management fully one-half of the problem is “up to the management”.
During his career spanning a period of 26 years, he conducted a series of experiments
in three companies: Midvale Steel, Simonds Rolling Machine and Bethlehem Steel.
While serving as the chief Engineer of Midvale Steel Company, Taylor made several
important contributions which were classified under Scientific Management:
i) Time and Motion Study
Since Taylor had been a machinist himself; he knew how piece-work employees used
to hold back its production to its one-third level because they feared that their employers
would cut their piece rate as soon as there was a rise in production. The real trouble,
Taylor thought was that no one knew how much work it was reasonable to expect a man
to do. He therefore, started time and motion study, under which each motion of a job
is timed with the help of a stop watch and shorter and fewer motions were to be developed.
Thus the best way of doing a job was found. This replaced the old rule-of-thumb-knowledge
of the workman.
ii) Differential Payment
Taylor introduced a new payment plan called the differential piece work, in which
he linked incentives with production. Under this plan a worker received low piece rate if
he produced the standard number of pieces and high rate if he surpassed the standard.
Taylor thought that the attraction of high piece rate would motivate workers to increase
production.
Notes The principle of division of work is the principle of specialization. It emphasizes the
importance of specialization in an organization for promoting efficiency in the utilization
of labor. Division of work or specialization can be applied to all types of work, shop labor
(i.e., labor involved in production work), technical work and managerial work.
Division of work in the management becomes necessary because the various
functions of management likes planning, organizing, staffing, controlling etc. cannot be
performed by a single person or by the board of directors alone. The different managerial
functions have to be entrusted to socialists in the related fields. The division of labor in
the process of management ensures more and better work with the same effort.
2) Authority and Responsibility
As management consists in getting the work done through others, it implies that
the manager should have the right to give orders and the powers to extract obedience.
Authority is the right to extract obedience and get the work done, in other words,
it is the power or right of a person to command his subordinates. Responsibility is the
obligation of a person to perform the task or duties assigned to him; thereby authority
and responsibility are closely related.
Authority is closely related to responsibility, and it arises whenever authority is
exercised. An individual to whom authority is given to exercise power must also be
prepared to bear the responsibility to perform the work. Responsibility without authority
is meaningless.
3) Discipline
Discipline means obedience to authority and observance of rules of service and norms
of performance, respect for agreements, sincere efforts for completing the given job,
respect etc. Discipline is essential for the smooth running of business.
It is a sense of respect fir agreements which are directed at achieving obedience,
application, energy and outward marks of respect. In other words, it is the observance
of the rules of service, norms of performance, sincere efforts for completing the given job,
respect for the superiors etc. in short, it means obedience to authority.
4) Unity of Command
The Principle of Unity of Command means that an employee should receive orders,
instructions, directions and guidance from one superior only for any action or activity. It
states that one person should receive orders from only on superior. In other words one
person should be accountable to only one boss. If two superiors wield authority over the
same person it causes uneasiness, disorder, indiscipline among employees and
undermining of authority. It the principle of unity of command is into observed the authority
there will be confusion and it will be difficult to pin point responsibility on anyone.
5) Unity of Direction
The Principle of Unity of Direction means that there should be one head and one
plan for a group of activities having the same or common objectives. In simple terms, for
every category of work, there should be one plan of action, and it should be executed
under the overall control and supervision of one head (i.e., superior). For instance, all sales
activities having the common objective of promotion of sales should have one plan of action
and should be the responsibility of the manager. Thus it implies that there should be one
head and one plan for a group of activities having same objectives. For every category
of work, there should be one plan of action and it should be executed under the overall
control and supervision of head or superior.
Notes A
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Gang - Plank (
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The principle of scalar chain or line of authority recognizes the necessity for formal
authority in the organization. It suggests that the scalar chain or the line of authority should
be followed ordinarily or normally. That is, normally, orders or communications should pass
through the proper channels of authority along the scalar chain.
Advantages of Scalar Chain
(a) This principle ensures unity of command in the organization.
(b) Because of the scalar principle, every person in the organization knows under
whom he is working and whose orders he has to obey.
(c) This principle facilitates delegation of authority, which is essential for the
successful working of the organization.
Draw Backs/Limitations of Scalar Chain
(a) The scalar chain is a lengthy, tedious and time consuming process. Under the
scalar chain, communication takes too much time, as it has to go from one
level to other in a chain.
(b) Under the scalar chain principle suffers from the above drawbacks, the scalar
chain should not be rigid. There should be provision for short-circuiting the scalar
chain so as to allow quick communication and swift action, where ever desired.
10) Order
Order refers to the systematic arrangement of things and persons in an organization.
Management should observe the principle of ‘right place for everything and every man’.
To observe this principle, there is need for scientific selection of competent personnel,
correct assignment of duties to personnel and good organization. According to Henry
Fayol, order can be divided into two types, viz, (a) Material Order and (b) Social Order.
Material order refers to arrangement of materials at the right place for every
occasion.
Social order refers to the arrangement of persons. In other words, it refers to the
arrangement of people in such a way that there will be a fixed work place for every worker,
and every worker will be available in his workplace during the working hours. Further perfect
social order also implies that the right person is placed on the right job.
Thus, a successful observance of the principle of order requires that (a) There should
be scientific selection of competent personnel, (b) Correct assignment of duties to the
personnel (c) Good Organization.
Amity Directorate of Distance and Online Education
Overview of HRM 23
1.13 Summary
Human resource can be defined as the translating process of human being into a
useful resource. When a human being contributes his/her skills, knowledge and positive
attitude towards productive work in an organization, he/she becomes the human resource
for that organization.
Human resource management is the policy and practice of one need to carry out
the people or human resource aspects of a management position, including recruiting,
screening, training, rewarding and appraising.
Job Analysis is the process of studying and collecting information relating to the
operations and responsibilities of a specific job. The immediate products of this analysis
are job description and job specification.
Planning involves choosing of one of the various alternatives available for
accomplishing the desired result with the greatest economy and certainty through the
process of looking ahead.
Organizing involves establishing an intentional structure of roles for people in an
organization. Structural considerations such as the chain of command, division of labor,
and assignment of responsibility are part of the organizing function.
Personnel Development programmes tries to educate the managerial executive of
the market situations and trends which help in forming new plans and strategies of
products.
Personnel evaluation method is seeking the measurement of employee work
effectiveness using objective criteria. Performance appraisal systems hope to achieve
higher productivity outcomes by delineating how employees meet job specifications.
1. ________ are the resources that provide utility value to all other resources.
[a] Men
[b] Material
[c] Money
[d] Machinery
2. The characteristics of human resources are ________ in nature
[a] Homogeneous
[b] Heterogeneous
as an Engineer in Chaitanya Engineering Company, Mumbai and married her on 1/1/2009 Notes
though their parents did not agree to this marriage. They did not have any assistance
from any side. Mrs. Kiranmayi was pregnant and applied for maternity leave on 1/12/2009.
Her employer granted leave an provided her all the benefits to be provided legally and
sanctioned her an additional amount of Rs. 5000 for extra medical care. She faced various
health problems two weeks before and one week after the delivery. Mr. Kishore also applied
for paternity leave on 1/12/2010 for three weeks and required his employer to grand leave
as he ought to help and render physical and psychological support to his wife as there
was none to help his wife. Branch manager of the Indian Bank, Mumbai branch, forwarded
this letter to the head office with adverse comments. The letter was sent to the chief
personnel manager and to the legal adviser of the bank. However, the General Manager
of the bank had to finally settle this issue.
Questions:
1. What is the peculiarity of this case?
2. What would be the comments of the legal adviser and chief personnel manager?
3. How would you settle the issue, if you were the General Manager of the bank?
Case - 2:
HRM - an Integral Part of Strategic Management
The Coca-Cola company is the most successful MNC with operations in as many
as 200 countries and nearly 80 percent of its revenue coming from global operations. Coca-
cola is typically perceived as the quintessential global corporation. The US based company
believes in “thinking global but acting locally” and this strategy guides the Cola giant’s
management of cross border operations. It grants the national business the freedom to
conduct operations in a manner appropriate to the market. At the same time, the company
tries to establish a common mindset that all its employees share.
The corporate HR function is charged with providing the glue that binds all the
divisions (there are 25 operating divisions) into the Coca-Cola family. The corporate HRM
achieves this in two main strategies: (i) by propagating a common HR philosophy within
the company and (ii) by developing a group of internationally minded mid-level executives
for future senior management responsibilities.
The corporate HRM group perceives its mission as one of developing and providing
the underlying philosophy around when local businesses can develop their HR practices.
For example, rather than having a standard salary policy for all its subsidiaries. Coca-
Cola has a common salary philosophy- the local compensation package should be
competitive with the best companies in the local market. Twice a year the corporate HRM
Group conducts a two week HRM orientation session for the HR staff from each of its
25 operating divisions. These sessions give an overview of the company’s HRM philosophy
and talk about how local businesses can translate that philosophy into HR policies. Coca-
Cola has found that information sharing is one of the great benefits of bringing HR
professionals together. For example, tools that have been developed in India to deal with
specific HR issues, might also be useful in Australia. The sessions provide the medium
through which HR professionals can communicate and learn from each other, which
facilitates the rapid transfer of innovative and valuable HR tools from region to region.
Questions:
1. Do you agree with the HR practices of Coca-Cola? If yes, why?
2. In what way does the company seek to integrate HR practices with its corporate
strategic management?
3. Can you name any other company which has similar/better HR practices?
Amity Directorate of Distance and Online Education
30 Human Resource Management
1.20 Bibliography
1. Elwood F. Holton II, James W. Trott, Jr., 1996, Trends Toward a Closer
Integration of Vocational Education and Human Resources Development,
Journal of Vocational and Technical Education, Vol. 12, No. 2, p7
2. Collings, D. G., & Wood, G. (2009). Human resource management: A critical
approach. In D. G. Collings & G. Wood (Eds.), Human resource management:
A critical approach (pp. 1-16). London: Routledge.
3. Johnason, P. (2009). HRM in changing organizational contexts. In D. G. Collings
& G. Wood (Eds.), Human resource management: A critical approach (pp. 19-
37). London: Routledge.
4. O’Brien, Michael (October 8, 2009). “HR’s Take on The Office”. Human Resource
Executive Online. Archived from the original on 18 December 2011. Retrieved
28 December 2011.
5. lrich, Dave (1996). Human Resource Champions. The next agenda for adding
value and delivering results. Boston, Mass.: Harvard Business School Press.
ISBN 0-87584-719-6. OCLC 34704904.
6. Azhar, Sarwar and ShehzadiIram. “Human Resource Outsourcing.” Proceedings
of 3rd International Conference on Business Management. University of
Management and Technology Lahore, 27-28 February 2013. Lahore: School of
Business and Economics, 2013. 1-14. Print.
7. Charles R. Perry. “Outsourcing and union power.” Journal of Labour Research
18.4 (1997): 521. Springer Link. Web. 20 March 2014.
8. Kenneth L. Deavers. “Outsourcing: A corporate competitiveness strategy, not
a search for low wages.” Journal of Labour Research 18.4 (1997): 504. Springer
Link. Web. 22 April 2014.
9. Murem Sharpe. “Outsourcing, organizational competitiveness, and work.”
Journal of Labour Research 18.4 (1997): 535. Springer Link. Web. 25 March
2014. (E-Journal)
10. Vashistha, A. “Human resource outsourcing: emerging trends.” Global Services.
Global Services 16 April 2007. Web. 13 February 2014.
Notes
Structure:
2.1 Introduction to Human Capital Management
2.2 Significance of Human Capital Management
2.3 Organisational Behavior
2.4 Determinants of Organisational Behaviour
2.5 Approaches to Organisational Behaviour
2.6 Emerging Issues in Organisational Behaviour
2.7 Organizational Development
2.8 Need and Importance of Organisational Development
2.9 Assumptions of Organisational Development
2.10 Benefits and Limitations of Organisational Development
2.11 Organisation Development Values
2.12 Process of Organizational Development
2.13 Steps in Organisational Development
2.14 Job Enrichment
2.15 Job Enlargement and Rotation
2.16 Job Specifications and Descriptions
2.17 Job Evaluation
2.18 Job Evaluation Methods
2.19 Summary
2.20 Check Your Progress
2.21 Questions and Exercises
2.22 Key Terms
2.23 Check Your Progress: Answers
2.24 Case Study
2.25 Further Readings
2.26 Bibliography
Objectives
After studying this unit, you should be able to understand:
Significance of Human Capital Management
Concept of Organisational Behavior
Organisational Behaviour Models
Techniques of Organizational Development
Concept of Job Enrichment, Job Enlargement and Rotation
Concept of Job Specifications and Descriptions
Job Evaluation Methods
Amity Directorate of Distance and Online Education
32 Human Resource Management
Notes human behaviour. It is the human factor that is contributory to the productivity hence the
study of human behaviour is important. Great importance therefore must be attached to
the study. Researchers, management practitioners, psychologists and social scientists
must understand the very credentials of an individual, his background, social framework,
educational update, impact of social groups and other situational factors on behaviour.
Managers under whom an individual is working should be able to explain, predict, evaluate
and modify human behaviour that will largely depend upon knowledge, skill and experience
of the manager in handling large group of people in diverse situations. Pre-emptive actions
need to be taken for human behaviour forecasting. The value system, emotional
intelligence, organisational culture, job design and the work environment are important
causal agents in determining human behaviour. Cause and effect relationship plays an
important role in how an individual is likely to behave in a particular situation and its impact
on productivity. An appropriate organisational culture can modify individual behaviour.
Recent trends exist in laying greater stress on organisational development and imbibing
a favourable organisational culture in each individual. It also involves fostering a team spirit
and motivation so that the organisational objectives are achieved. There is a need for
commitment on the part of the management that should be continuous and incremental
in nature.
Meaning of Organisational Behavior
Organisational behaviour is the study of both group and individual performance and
activity within an organisation. The two theories of how the behaviour of the organisation
can be viewed are the Internal and the external theory.
Organisational behaviour studies the impact individuals, groups and structures have
on human behaviour within organisations. It is an interdisciplinary field that includes
sociology, psychology, communication and management. Organisational behaviour
complements organisational theory. This theory mainly focuses on organisational and
intra-organisational topics and complements human-resource studies, which is more
focused on everyday business practices.
Organisational behaviour is field of study that illustrates the impact that individual,
groups and structure have on behaviour within organisation for his purpose of applying
such knowledge towards improving an organisation effectiveness i.e. organisational
behaviour is concerned with the study of what people do in an organisation and how that
behaviour affects the performance of the organisation.
Organisational behaviour is an applied behavioural science that is built on contribution
from a number of behavioural disciplines.
“Organisational Behaviour is the study and application of knowledge of how people Notes
act or behave within organisation”. - Keith Davis and Newstrom
“Organisational behaviour is directly concerned with the understanding, production
and control of human in organisations.” - Fred Luthans
“Organisational behaviour is the study and application of knowledge about how people
act within an organisation. It is a human tool for human benefit. It applies broadly to the
of people in all types of organisation.” - Newsroom and Davis
“Organisational behaviour is a field of study that investigates the impact that
individuals, groups and structure have on within the organisations for the purpose of
applying such knowledge toward improving an organisation’s effectiveness.”
- Stephens P. Robbins
“Organisational behaviour as a systematic study of the actions and attitudes that
people exhibit within the organisations.” - Stephens P. Robbins
Organisational Behaviour is field of study that completely finds out the impact and
effects that individuals, groups and structure have on behaviour within organisation, their
reaction in the organisation to different situations etc. It is the study and application of
knowledge about how people act within organisations. Organisational Behaviour is a human
tool for human benefit. It is the behaviour of people in all types of organisations, such
as business, government, schools and services organisations. It covers three determinants
of behaviour in organisations: individuals, groups and structure. Organisational Behaviour
is an applied field. It applies the knowledge gained about individuals and the effect of
structure on behaviour, in order to make organisations work more effectively. Organisational
Behaviour covers the core topics of motivation, leadership behaviour and power,
interpersonal communication, group structure and process, learning, attitude development
and perception, change process, conflict, job design and work stress. Organisation and
management are very different from each other.
Organisation as a purposeful system with several subsystems where individuals and
activities are organized to achieve certain predetermined goals through division of labor
and coordination of activities. Division of labor refers to how the work is divided among
the employees and coordination refers to how all the various activities performed by the
individuals are integrated or brought together to accomplish the goals of the organisation.
The term organizing is used to denote one aspect of the managerial activities when he
or she is preparing and scheduling the different tasks that need to be completed for the
job to be done.
Management refers to the functional process of accomplishing the goals of the
organisation through the help of others. A manager is an individual who is given the
responsibility for achieving the goals assigned to him or her as part of the overall goals
of the organisation and who is expected to get the job done. The terms of top management,
lower management are frequently used to indicate the hierarchical levels of those who
are engaged in the process of getting the goals of the organisation accomplished.
The concept of OB is based on two elements which namely include:
1. Nature of people
2. Nature of the organisation
Notes
1. Nature of People
Nature of people in the organisation includes the basic qualities of a person or the
character that represents an individual. This can either be similar or unique. At the
organisation level, some major factors which affect the nature of people include-
a) Individual Difference: It is the managerial approach towards each employee
individually, that is one-on-one approach. It is not a statistical approach which
includes avoidance of single rule.
Example: The manager of the organisation should not be biased towards any
particular employee. He should treat them equally and try not to judge anyone
on any other factor apart from their work.
b) Perception: It is a unique ability to observe, listen and conclude something.
It means believing in one’s own senses. It is the way we interpret things and
have our point of view is our perception.
Example: Person A thinks that night shift is better for work, while person B
thinks that day shift is better for work. Here we see both person A and B have
different perception about the same thing.
c) A whole person: It is a fact that we cannot employ a person’s skill and brain,
we should appoint the person as a whole. These skills come from environment
and knowledge. An individual’s personal life cannot be separated from his
professional life, just like emotional conditions are not separable from physical
conditions. So, people function is the functioning of a total human being not
a specific feature of human being.
d) Motivated behaviour: It is the behaviour rooted or caused by some inspiration
from some person, group or even a situation which would have arised. In an
organisation or firm, we can see two different types of motivated employees –
one is positive motivation which includes encouraging others to change their
behaviour or say complete a task by luring them with promotions or any other
profits. The other is negative motivation which includes forcing or warning others
to change their behaviour otherwise they should face serious consequences.
e) Value of person: Each and every employee want to be valued and appreciated
for their skills, capabilities and abilities. This is followed by opportunities which
help them develop and improve themselves for the better.
2. Nature of Organisation
Nature of organisation mainly states the motive and goal of the organisation. It refers
to the various opportunities the organisation provides in the global market. It helps in
defining the employees’ standard and the character of the company by acting as a mirror
image of the organisation. To understand the nature of the organisation we should first
be familiar with the social system, the mutual interest it shares and the work ethics.
a) Social system: Every organisation socializes with other firms, their customers,
which includes the outer world and all of its employees i.e. their own social
roles and status. The employee’s behaviour is mainly influenced by their group
Amity Directorate of Distance and Online Education
Human Capital 37
as well as individual forces. Social system is of two types. The first one is formal Notes
which is formed by people working together in a firm or people who belong to
the same club who are considered as formal social system. The second one
is informal which is formed by a group of friends, people socializing with others
freely, enjoying, partying etc.
b) Mutual interest: An organisation needs people to grow and people need
organisations to survive and prosper. This is called as mutual understanding
between the organisation and the employees that helps both reach their
respective objectives and goals. The best example is the bank where we deposit
money and in return we loan, interest etc.
c) Ethics: They refer to the moral principles of an individual, group and organisation.
In order to attract and retain valuable employees, ethical treatment is necessary
and some moral standards need to be set by the organisation. Most of the
organisation is now establishing and maintaining code of ethics training reward
for ethical behaviour.
Notes difference in the level of economic development of the countries is largely a reflection of
the differences in the types of their behaviour. The key element in this proposition is that
the values, attitudes, commitment, aptitude, general orientation and quality of the people
of a country determine its economic development. The shift from manufacturing to service
and from service to knowledge and the increasing pace of technological up-gradation are
making human behaviour the ingredient of the nation's well-being and growth.
iii) Human Behaviour and Organisational Performance
Organisational performance can be measured against organisational objectives like
market share, rate of profit, product innovation, customer satisfaction and employee
satisfaction. Appropriate human behaviour contributes to the employees' commitment
towards organisational goals. In effect, employee values, attitude and other behavioural
issues shape the employee behaviour that would be appropriate for achieving organisational
performance. Thus, appropriate human behaviour contributes for the organisational
performance.
Strategy is a unified, comprehensive and integrated course of plan/action. Crafting
and implementing strategy depend on employee commitment to organisational strategies.
Employee commitment in its turn depends on appropriate leadership style, human values,
self-motivation, appropriate perception and learning. Thus, behavioural issues of employees
determine the level of success in crafting and achieving organisational strategies.
Appropriate and adaptable human behaviour enables the organisation to develop
employee commitment to the organisational strategies. In addition, appropriate behaviour
encourages the employees to acquire and develop required hard skills like technical skills,
knowledge and competency. Organisations do also invest in the development of technical
skills and knowledge of those employees whose behaviour is quite appropriate for the
achievement of organisational strategies. Thus, appropriate behaviour provides an
opportunity for the development of distinctive competence of employees that enable them
to craft and achieve distinctive strategies.
iv) Human Behaviour and Strategic Advantages
Strategic advantages include achieving low cost advantage, high quality, superior
customer service, innovations and superior speed in producing and delivering a product/
service. Committed employees with appropriate technical skills contribute to achieve
highest human efficiency, which in turn makes the operations at the lowest cost. In
addition, the committed minds contribute to innovation and other strategic advantages like
superior customer service and superior speed. Thus, appropriate human behaviour
contributes for building up of strategic advantages of the firms.
v) Human Behaviour and Efficient Human Resource Management
Appropriate human behaviour helps for positive and efficient human resource
management in terms employee satisfaction, fair treatment of employees, training and
continuous learning, performance management, employee counselling, mentoring, building
teams, congenial superior-subordinate relations as well as human relations, sound salary
and benefits. Thus, appropriate behaviour brings about efficient management of human
resources.
Thus, appropriate human behaviour helps not only efficient human resource
management but also envisages strategic management which ultimately leads to achieving
high level of organisational performance.
Notes The key elements in the organisational behaviour are people, structure, technology
and the environment in which the organisation operates. When people join together in an
organisation to accomplish an objective, some kind of structure is required. People also
use technology to help get the job done.
(i) People: People make up the internal and social system of the organisation.
They consist of individuals and groups. The groups may be big or small; formal
or informal; official or unofficial. Groups are dynamic and they work in the
organisation to achieve their objectives.
(ii) Structure: Structure defines the formal relationships of the people in
organisations. Different people in the organisation are performing different type
of jobs and they need to be elated in some structural way so that their work
can be effectively co-ordinated.
(iii) Environment: All organisations operate within an external environment. It is
the part of a larger system that contains many other elements such as
government, family and other organisations. All of these mutually influence each
other in a complex system that creates a context for a group of people.
(iv) Leadership: Leadership refers to who leads a company and what type of
leadership styles are used, from the lowest managers with only a few direct
reports to founders and CEOs. Leadership styles should fit both the company
and its goals. Some companies benefit most from a forthright leader who
manages by example and can be ruthless when necessary. Other businesses
work best with a leader who shows strong relationship building and emotional
intelligence, taking time to coach each employee in new skills.
(v) Culture: Organisational behaviour is primarily concerned with company culture,
the attitudes and mores that make up how employees are expected to treat
one another, their jobs and customers. Companies should encourage a strong
culture and adopt the values necessary for success in the business and
development of all employees.
(vi) Company structure: The company structure is how the business is actually
built. This is a major factor when it comes to leadership styles and company
culture and is often discussed in detail as part of organisational behaviour
studies. A tall structure has many layers of management and can become very
bureaucratic. A flat structure has only a few layers and tends to be more organic.
Lean organisations reduce waste and increase efficiency whenever possible.
(vii) Tools of communication: Leaders and employees must have ways to
communicate with each other, so another large part of organisational behaviour
involves the study of communication options at a workplace. Body language
and nonverbal cues are important, but technology is also necessary.
Workplaces regularly use email, chat and mobile systems, each of which have
their own effect on how messages are perceived and used.
1. People Notes
The people in an organisation are of different characters, personality, skills, qualities,
interests, background, beliefs, values and intelligence. In order to maintain and keep up
a good and healthy environment, all the employees should be treated equally. They should
be judged according to their work and all other aspects that affect the organisation. In
managing human resources, managers have to deal with:
i) Individual employee who are expected to perform the tasks allotted to them.
ii) Dyadic relationships such as superior-subordinate interactions.
iii) Groups who work as teams and have the responsibility for getting the job done.
iv) People outside the organisation system such as customers and government
officials.
Example: Campus placements are offered by different companies to trainees from
different states. However, during and after training, all trainees are examined only on the
basis of their performance in the tasks or works assigned.
2. Structure
Structure refers to the layout or the design of an organisation or firm. It is the
construction and arrangement of relationships, strategies according to the organisational
goals and objectives. Some of the key concepts of organisation structure are listed as
below:
a) Hierarchy of Authority: This refers to the distribution of authority among
organisational positions and authority grants the position holder certain rights
including right to give direction to others and the right to punish and reward.
b) Division of Labor: This refers to the distribution of responsibilities and the way
in which activities are divided up and assigned to different members of the
organisation is considered to be an element of the social structure.
c) Span of Control: This refers to the total number of subordinates over whom
a manager has authority.
d) Specialization: This refers to the number of specialities performed within the
organisation.
e) Standardization: It refers to the existence of procedures for regularly recurring
events or activities.
f) Formalization: This refers to the extent to which rules, procedures and
communications are written down.
g) Centralization: This refers to the concentration of authority to make decision.
h) Complexity: This refers to both vertical differentiation and horizontal differentiation.
Vertical differentiation: outlines number of hierarchical levels; horizontal
differentiation highlights the number of units within the organisation (e.g.
departments, divisions).
3. Technology
Technology is the implementation of scientific knowledge for practical usage. It
provides the all the resources required by the people. This will have an effect on their
work and task performance in the right direction and path.
Organisations have technologies for transforming inputs and outputs. These
technologies consist of physical objects, activities and process, knowledge, all of which
are brought to bear on raw materials, labour and capital inputs during a transformation
process. The core technology is that set of productive components most directly
Notes associated with the transformation process, for example, production or assembly line in
manufacturing firm.
Classification of Technology: Thomson classified technology into three categories:
Long-linked technology, Mediating Technology and Intensive Technology.
i) Long linked Technology: In this, tasks are broken into a number of sequential
and interdependent steps, where the outputs of one unit become the input of
the next. (e.g. Assembly line) this facilitates to have high volume of output and
efficiency. This technology calls for mechanistic structures with high levels of
specialization, standardization and formalization.
ii) Mediating Technology: This links different parties who need to be brought
together in a direct or indirect way (e.g. Banks – use mediating technology to
lend money to borrowers by taking money from depositors)
iii) Intensive Technology: It is used when a group of specialists are brought
together to solve complex problems using a variety of technologies (e.g..
Hospital – parties are treated with the help of experts drawn from different fields
of specialization). Coordination of the different activities is achieved in the
system primarily through mutual adjustment among those engaged in solving
the problem in the different units. Organic structures would fit in this system
using intensive technology.
4. Environment
Each and every company functions according to the internal and external
environment. Internal environment includes the conditions, factors and all the elements
within an organisation that influences all the activities and functions of the firm, the choices
made by the firm and most importantly the of all its employees.
For example, employee morale, culture changes, financial changes or issues of the
company. While external environment can be defined as outside factors that affect the
company's ability to operate and function. Some of these operations can be manipulated
by the company’s marketing. The others require the company to make different
adjustments. For example political factors, changes to the economy and the company
itself etc.
Two Distinct Sets of Environment:
i) Specific Environment: This includes the suppliers, customers, competitors,
governments agencies, employees, unions, political parties etc.
ii) General Environment: It includes the economic, political, cultural, technological
and social factors in which the organisation embedded.
declining returns and sometimes, negative returns. The concept implies that for Notes
any situation there is an optimum amount of a desirable practice. When that
point is exceeded, there is a decline in returns. For example, too much security
may lead to less employee initiative and growth. This relationship shows that
organisational effectiveness is achieved not by maximizing one human variable
but by working all system variables together in a balanced way.
(v) A significant concern about organisational behaviour is that its knowledge and
techniques could be used to manipulate people without regard for human welfare.
People who lack ethical values could use people in unethical ways.
1. Maslow's Hierarchy
Perhaps the most famous theorist on the topic of human behaviour was Abraham
Maslow, who developed his theory on the hierarchy of needs in 1943. Essentially, Maslow
proposed that humans attempt to satisfy their needs beginning with the most basic and
do not move ahead to more complex needs until satisfying the basic needs first. The
hierarchy of needs progresses from the most basic needs for food and shelter to the need
for safety, the need for belonging and acceptance, the need for esteem and finally, the
need for self-actualization. To understand organisational behaviour, many look to Maslow's
hierarchy, particularly the last three levels, to help understand why individuals and groups
behave the way they do within organisations.
Abraham Maslow developed a theory of personality that has influenced a number
of different fields, including education. This wide influence is due in part to the high level
of practicality of Maslow's theory. This theory accurately describes many realities of
personal experiences. Many people find they can understand what Maslow says. They
can recognize some features of their experience or behaviour which is true and identifiable
but which they have never put into words.
Maslow is a humanistic psychologist. Humanists do not believe that human beings
are pushed and pulled by mechanical forces, either of stimuli and reinforcements or of
unconscious instinctual impulses. Humanists focus upon potentials. They believe that
humans strive for an upper level of capabilities. Humans seek the frontiers of creativity,
the highest reaches of consciousness and wisdom. This has been labeled "fully functioning
person", "healthy personality" or as Maslow calls this level, "self-actualizing person."
Maslow has set up a hierarchic theory of needs. All of his basic needs are instinctual,
equivalent of instincts in animals. Humans start with a very weak disposition that is then
fashioned fully as the person grows. If the environment is right, people will grow straight
and beautiful, actualizing the potentials they have inherited. If the environment is not "right"
(and mostly it is not) they will not grow tall and straight and beautiful.
Maslow has set up a hierarchy of five levels of basic needs. Beyond these needs,
higher levels of needs exist. These include needs for understanding, aesthetic appreciation
and purely spiritual needs. In the levels of the five basic needs, the person does not feel
Notes the second need until the demands of the first have been satisfied or the third until the
second has been satisfied and so on. Maslow's basic needs are as follows:
(i) Physiological Needs
These are biological needs. They consist of needs for oxygen, food, water and a
relatively constant body temperature. They are the strongest needs because if a person
is deprived of all basic needs, the physiological ones which would come first in the person's
search for satisfaction, he would not search for the second one i.e., safety needs.
(ii) Safety Needs
When all physiological needs are satisfied and are no longer controlling thoughts
and behaviours, the needs for security can become active. Adults have little awareness
of their security needs except in times of emergency or periods of disorganisation in the
social structure. Children often display the signs of insecurity and the need to be safe.
(iii) Needs of Love, Affection and Belongingness
When the needs for safety and for physiological well-being are satisfied, the next
class of needs for love, affection and belongingness can emerge. Maslow states that
people seek to overcome feelings of loneliness and alienation. This involves both giving
and receiving love, affection and the sense of belonging.
(iv) Esteem Needs
When the first three classes of needs are satisfied, the needs for esteem can become
dominant. These involve needs for both self-esteem and for the esteem a person gets from
others. Humans have a need for a stable, firmly based, high level of self-respect and respect
from others. When these needs are satisfied, the person feels self-confident and valuable
as a person in the world. When these needs are frustrated, the person feels inferior, weak,
helpless and worthless.
(v) Self-Actualization Needs
When all of the foregoing needs are satisfied, then and only then are the needs for
self-actualization activated. Maslow describes self-actualization as a person's need to be
and do that which the person was "born to do." "A musician must make music, an artist
must paint and a poet must write." These needs make themselves felt in signs of
restlessness. The person feels on edge, tense, lacking something, in short, restless. If
a person is hungry, unsafe, not loved or unaccepted or lacking self-esteem, it is very easy
to know what the person is restless about. It is not always clear what a person wants
when there is a need for self-actualization.
The hierarchic theory is often represented as a pyramid, with the larger, lower levels
representing the lower needs and the upper point representing the need for self-
actualization. Maslow believes that the only reason that people would not move well in
direction of self-actualization is because of hindrances placed in their way by society.
He states that education is one of these hindrances. He recommends ways education
can switch from its usual person-stunting tactics to person-growing approaches. Maslow
states that educators should respond to the potential an individual has for growing into
a self-actualizing person of his/her own kind.
Ten points that educators should address are listed:
1. We should teach people to be authentic, to be aware of their inner selves and
to hear their inner-feeling voices.
2. We should teach people to transcend their cultural conditioning and become
world citizens.
3. We should help people discover their vocation in life, their calling, fate or destiny. Notes
This is especially focused on finding the right career and the right mate.
4. We should teach people that life is precious, that there is joy to be experienced
in life and if people are open to seeing the good and joyous in all kinds of
situations, it makes life worth living.
5. We must accept the person as he or she is and helps the person learn their
inner nature. From real knowledge of aptitudes and limitations we can know
what to build upon, what potentials are really there?
6. We must see that the person's basic needs are satisfied. This includes safety,
belongingness and esteem needs.
7. We should refresh consciousness, teaching the person to appreciate beauty
and the other good things in nature and in living.
8. We should teach people that controls are good and complete abandon is bad.
It takes control to improve the quality of life in all areas.
9. We should teach people to transcend the trifling problems and grapple with the
serious problems in life. These include the problems of injustice, of pain,
suffering and death.
10. We must teach people to be good choosers. They must be given practice in
making good choices.
2. Herzberg's Approach
Notes are absent / if these factors are non-existent at workplace, then they lead to dissatisfaction.
In other words, hygiene factors are those factors which when adequate / reasonable in
a job, pacify the employees and do not make them dissatisfied. These factors are extrinsic
to work. Hygiene factors are also called as dissatisfiers or maintenance factors as they
are required to avoid dissatisfaction. These factors describe the job environment / scenario.
The hygiene factors symbolized the physiological needs which the individuals wanted and
expected to be fulfilled. Hygiene factors include:
• Pay: The pay or salary structure should be appropriate and reasonable. It must
be equal and competitive to those in the same industry in the same domain.
• Company Policies and administrative policies: The company policies should
not be too rigid. They should be fair and clear. It should include flexible working
hours, dress code, breaks, vacation, etc.
• Fringe benefits: The employees should be offered health care plans
(mediclaim), benefits for the family members, employee help programmes etc.
• Physical Working conditions: The working conditions should be safe, clean
and hygienic. The work equipments should be updated and well-maintained.
• Status: The employees’ status within the organisation should be familiar and
retained.
• Interpersonal relations: The relationship of the employees with his peers,
superiors and subordinates should be appropriate and acceptable. There should
be no conflict or humiliation element present.
• Job Security: The organisation must provide job security to the employees.
(ii) Motivational factors
According to Herzberg, the hygiene factors cannot be regarded as motivators. The
motivational factors yield positive satisfaction. These factors are inherent to work. These
factors motivate the employees for a superior performance. These factors are called
satisfiers. These are factors involved in performing the job. Employees find these factors
intrinsically rewarding. The motivators symbolized the psychological needs that were
perceived as an additional benefit. Motivational factors include:
• Recognition: The employees should be praised and recognized for their
accomplishments by the managers.
• Sense of achievement: The employees must have a sense of achievement.
This depends on the job. There must be a fruit of some sort in the job.
• Growth and promotional opportunities: There must be growth and
advancement opportunities in an organisation to motivate the employees to
perform well.
• Responsibility: The employees must hold themselves responsible for the work.
The managers should give them ownership of the work. They should minimize
control but retain accountability.
• Meaningfulness of the work: The work itself should be meaningful, interesting
and challenging for the employee to perform and to get motivated.
Limitations of Two-Factor Theory
The two factor theory is not free from limitations:
1. The two-factor theory overlooks situational variables.
2. Herzberg assumed a correlation between satisfaction and productivity. But the
research conducted by Herzberg stressed upon satisfaction and ignored
productivity.
Amity Directorate of Distance and Online Education
Human Capital 49
3. The theory’s reliability is uncertain. Analysis has to be made by the raters. The Notes
raters may spoil the findings by analyzing same response in different manner.
4. No comprehensive measure of satisfaction was used. An employee may find
his job acceptable despite the fact that he may hate/object part of his job.
5. The two factor theory is not free from bias as it is based on the natural reaction
of employees when they are enquired the sources of satisfaction and
dissatisfaction at work. They will blame dissatisfaction on the external factors
such as salary structure, company policies and peer relationship.
6. The theory ignores blue-collar workers. Despite these limitations, Herzberg’s
Two-Factor theory is acceptable broadly.
Implications of Two-Factor Theory
The Two-Factor theory implies that the managers must stress upon guaranteeing
the adequacy of the hygiene factors to avoid employee dissatisfaction. Also, the managers
must make sure that the work is stimulating and rewarding so that the employees are
motivated to work and perform harder and better. This theory emphasize upon job-
enrichment so as to motivate the employees. The job must utilize the employee’s skills
and competencies to the maximum. Focusing on the motivational factors can improve
work-quality.
Notes like TQM (Total Quality Management) and Re-engineering programmes that requires
employee involvement. TQM is a philosophy of management that is inspired by constant
attainment of customer satisfaction of all organisational process. Re-engineering means
radically re-building and redesigning those processes by which we create value for
customers.
5. Changing Demographics of Workforce
Major challenges from changing demographics of workforce relate to dual-career
couples. Couples where both partners are actively pursuing professional careers. The
increase in number of dual career profession limits individual flexibility and may hinder
organisation flexibility in acquiring and developing talent. Another change in the workforce
demographics relates to the growing number of employees who are young.
focuses on total system change on a long term basis. Organizational development relies Notes
on continuous change and development of individual employee and organization as a
whole.
Organization development “is a long term philosophy based on collective
commitment, vision, empowerment, problem solving and employee welfare where the latest
technology and organizational processes are used to create quality of work life to achieve
organizational effectiveness and transformation into a vibrant, competitive and growth
oriented learned organization.”
The characteristics of organisation development implied in its definition and practice
are discussed below:
1. System Orientation: Organization development is system oriented. It is
concerned with the interactions of the various parts of the organization which
affect each other. It lays stress on inter-group and interpersonal relationship.
It is concerned with structure and process as well as attitudes. The basic issue
to which it is directed is: How do all of these parts work together to be effective?
Emphasis is on how the parts relate, not on the parts themselves.
2. Use of Change Agent: Organization development is generally implemented with
the help of one or more change agents, whose role is to stimulate, facilitate
and co-ordinate change. The change agent usually acts as a catalyst, creating
change within the system while remaining somewhat independent of it. Although
change agents may be either external or internal, they are usually consultants
from outside the company. Advantages of using external change agents are that
they are more objective and have diverse experiences. They are also able to
operate independently without ties to the hierarchy and politics of the firm.
3. Problem Solving: Organization development is concerned with problem solving.
It seeks to solve the problems through practical experiences gained on the work
and not merely through theoretical discussion as in a class room. These
problems mainly occur at the time of working on the job; hence the
organisational members. This focus on improving problem-solving skills by
discussing data-based system problems is called action research. In other
words, employees are “learning how to learn” from their experiences, so they
can solve new problems in the future.
4. Experimental Learning: Organisational development provides experimental
learning to help the participants learn new behaviour patterns through
experience. They can discuss and analyse their own immediate experience and
learn from it. This approach tends to produce more changed behaviour than the
traditional lecture and discussion, in which people talk about abstract ideas.
Theory is necessary and desirable, but the ultimate test is how it applies in
a real situation.
5. Human Values: Organisational development programmes are often based on
humanistic values. The values are positive beliefs about the potential and desire
for growth among employees. To be effective and self-reviewing, an organization
needs employees who want to increase their skills and contributions. The best
environment for this to happen is one that creates opportunities for growth by
stressing collaboration, open communication, interpersonal trust, shared power
and constructive conformation. They all provide a value base for organisational
development efforts and help ensure that the organization will be responsive to
human needs.
10. To provide help and support for employees, especially those in senior positions, Notes
who need an opportunity to be coached in how to do their jobs better.
11. To assist in creating systems for providing feedback on individual performance
and on occasion, conducting studies to give individuals feedback and coaching
to help them in their individual development called on to assist an organization.
Organisational development as a field has thrived because of the value-added
concepts and tools that it has brought to organizations and its stakeholders (those
concerned with how the organization operates), including customers, stockholders,
employees, management, the community and even the nation. Through organisation
development. An atmosphere can be established which will support more innovation and
creativity, increase job satisfaction, develop more positive interpersonal relationships and
foster greater participation in creating plans and defining organizational goals. All of this
will create a more effective and efficient organization that will, consequently, provide higher-
quality goods and services at a reasonable price, increase profitability, improve stock
values, improve the work environment and support management in its leadership role.
Notes 2. Gives each member of the organization opportunities to develop to his full
potential.
3. Seeks to make the organization more effective in meeting all its goals.
4. Tries to create an environment in which exciting and challenging work can be
found.
5. Gives people in organizations the chance to influence how they relate to work,
the organization and the work environment.
6. Treats each human being as a person with a complex set of needs, all of which
are important in his or her work and life.
Notes 9) Evaluation and follow up: The organisation should evaluate the organisational
development programmes and should find out their utility, and develop the
programmes further for correcting the deviations. The consultants make great
significance to the organisation in this respect. The entire steps in the
organisational development processes should be followed by the organisation
in order to derive full range of organisational development benefits.
part of the way in which business is done in the organization. If the evaluation indicates Notes
that desired objectives were not met, then this phase is skipped. In both cases, the
process begins all over again. At some point, the consultant will withdraw from the
intervention process, having transferred his or her skills to the client organization (again,
whether the organisational development professional is internal or external). This may
occur because additional change is no longer a priority to the client organization or that
it is not ready for the next stage of change. It may be because organisational development
skills are needed that the current organisational development consultant does not possess.
It may be that the consultant has been co-opted by the organizational culture and is no
longer able to maintain objectivity. For whatever reason, separation should occur
intentionally and not by just letting it happen.
Job enlargement expands a job horizontally. It increases job scope; that is, it
increases the number of different operations required in a job and the frequency with which
the job cycle is repeated. By increasing the number of tasks an individual performs, job
enlargement increases the job scope, or job diversity. Instead of only sorting the incoming
mail by department, for instance, a mail sorter's job could be enlarged to include physically
Notes delivering the mail to the various departments or running outgoing letters through the
postage meter.
Efforts at job enlargement have met with less than enthusiastic results. As one
employee who experienced such a redesign on his job remarked, "Before I had one lousy
job. Now, through enlargement, I have three!" So while job enlargement attacks the lack
of diversity in over specialized jobs, it has done little to provide challenge or meaningfulness
to a worker's activities.
Job Rotation
Job rotation refers to the movement of an employee from one job to another. Jobs
themselves are not actually changed, only the employees are rotated among various jobs.
An employee who works on a routine job moves to work on another job for some hours/
days/months and returns back to the first job. This measure relieves the employee from
the boredom and monotony, improves the employee's skills regarding various jobs and
prepares worker's self-image and provides personal growth. However, frequent job rotations
are not advisable in view of their negative impact on the organization and the employee.
Job Specifications
Job specification defines the knowledge, skills and abilities that are required to
perform a job in an organization. Job specification covers aspects like education, work-
experience, managerial experience etc. which can help accomplish the goals related to
the job. Job specification helps in the recruitment & selection process, evaluating the
performance of employees and in their appraisal & promotion. Job specification, along with
job description, is actually derived from job analysis. Collectively, job specification and
job description help in giving a overview of the job in terms of its title, position, roles,
responsibilities, education, experience, workplace etc.
Importance of Job Specification
The importance and purpose of job specification is a thoroughly understand the
specific details of a job. Jobs can be of different types and can require a different skill
sets to get the maximum output from a particular. Job specification gives important details
related to the job like education & skills, prior work experience, managerial experience,
personality traits etc. which would help an employee accomplish the objectives of a job.
For a recruiter, job specification lays down the guidelines basis of which the company
can recruit and select the best possible candidate who would be best suited for the job.
Apart from actually finding the right candidate or employee, job specification can be used
for screening of resumes and shortlist only those candidates who are the closest fit to
the job. Hence, a job specification gives specific details about a job and what kind of
skill sets are required to complete the job.
Components of Job Specification
There are many parameters which are considered while giving the job specification
for a certain profile:
1. Educational Qualification: This parameter gives an insight on how qualified
a certain individual is. It covers their basic school education, graduation,
master’s degree, other certifications etc.
Job Descriptions
A job description is an internal document that clearly states the essential job
requirements, job duties, responsibilities, and skills required to perform a specific role.
A more detailed job description will cover how success is measured in the role so it can
be used during performance evaluations.
Job Description practical application and use in legal issues.
Writing job descriptions is an important step in planning your staffing programs. They
form the foundation for many important processes such as job postings, recruitment, and
selection, setting expectations, compensation, training and performance management.
Every employee must be provided with his job description as to how to perform his duties,
limitations or boundaries in his duties, to whom he has to report and answerable, code
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Notes of conduct, punctuality and discipline and safety procedure that is to be followed in case
of Performing hazardous jobs. Having a job description document with employee, helps
employer in dealing with employees especially in the circumstances when an employee
proceed legally against employer for rejecting his/her claiming of compensation for the
accident happened during the course of employment or for taking disciplinary action
against employees who committed wrong.
Circumstances could be like; employees especially who does hazardous jobs, must
follow safety measures which are framed by the safety officer to avoid accidents. To those
employees if any accident happens, he may claim for compensation on the statutory
grounds framed by the Legislature. Here it is the task of HR manager to crosscheck with
actual safety measures to be followed and safety measures followed at the time of
occurrence of accident. If it is found that the victim did not follow actual safety measures
to be followed, he may not be eligible to claim the compensation. The victim of accident
cannot claim that he was not aware of safety measures to be followed while performing
such job, since he was already provided with job description document having all details
of his job as to how to be in his job. If it is found that the victim followed actual and safety
measures to be followed, the victim has right to claim compensation in accordance with
the statutory provisions framed by the Legislature (labour laws). (In India, Workmen's
Compensation Act, 1923 is the law that deals with claiming of conversation by employees
who succumbed to accident during the course of their employment likewise; when an
employee proceed legally against employer for taking disciplinary action against
employee, it is a task of HR manager to crosschecks with predefined in-disciplinary
activities mentioned in the job description which was already provided to that employee.
perfected during this time period of the late 1950s. With the advent of the Civil Rights Notes
movement, job evaluation literally got written into the law. The Equal Pay Act of 1963
required jobs to be compared on the basis of skill, effort, and responsibility to determine
if they were or were not equal. A 1979 study of job evaluation, as a potential source of
and/or a potential solution to sex discrimination in pay, was made by the National
Research Council under a contract from the Equal Employment Opportunity Commission.
The study suggested that jobs held predominantly by women and minorities could be
undervalued. Such discrimination resulted from the use of different plans for different
employee groups, from the compensable factors employed, from the weights assigned
to factors, and from the stereotypes associated with jobs. Although the preliminary report
failed to take a position on job evaluation, the final report concluded that job evaluation
holds some potential for solving problems of discrimination.
Job Evaluation involves determination of relative worth of each job for the purpose
of establishing wage and salary differentials. Relative worth is determined mainly on the
basis of Job Description and Job Specification only. Job Evaluation helps to determine
wages and salary grades for all jobs. Employees need to be compensated depending on
the grades of jobs they perform. Remuneration must be based on the relative worth of
each job.
The systematic process of job evaluation includes an in-depth analysis of all positions
based on a specific, common set of factors that can include skill, education, experience,
responsibility, decision-making, problem-solving, mental demand, physical demand and
complexity. The technique of ranking jobs through job evaluation is used to determine the
appropriate compensation to offer. Using a systematic process for determining the pay
grade for different jobs helps to take the subjectivity out of compensation decisions and
increases employee compliance.
Job evaluation reclassifications are often required when the requirements of a
position, usually regarding either tasks or responsibilities or changes due to downsizing
or expansion. Job evaluations are not assessments of employee performance, rather an
analysis of what a competent employee in the job position should be paid.
ii) It offers a systematic procedure for determining the relative worth of jobs. Jobs Notes
are ranked on the basis of rational criteria such as skill, education, experience,
responsibilities, hazards, etc., and are priced accordingly.
iii) An equitable wage structure is a natural outcome of job evaluation. An unbiased
job evaluation tends to eliminate salary inequities by placing jobs having similar
requirements in the same salary range.
iv) Employees as well as unions participate as members of job evaluation
committee while determining rate grades for different jobs. This helps in solving
wage related grievances quickly.
v) Job evaluation, when conducted properly and with care, helps in the evaluation
of new jobs.
vi) It points out possibilities of more appropriate use of the plant's labour force by
indicating jobs that need more or less skilled workers than those who are
manning these jobs currently.
1. Ranking Method
Perhaps the simplest method of job evaluation is the ranking method. According to
this method, jobs are arranged from highest to lowest, in order of their value or merit to
the organization. Jobs can also be arranged according to the relative difficulty in performing
them. The jobs are examined as a whole rather than on the basis of important factors
in the job; the job at the top of the list has the highest value and obviously the job at
the bottom of the list will have the lowest value. Jobs are usually ranked in each department
and then the department rankings are combined to develop an organizational ranking. The
variation in payment of salaries depends on the variation of the nature of the job performed
by the employees. The ranking method is simple to understand and practice and it is
best suited for a small organisation. Its simplicity however works to its disadvantage in
big organisations because rankings are difficult to develop in a large, complex organisation.
Moreover, this kind of ranking is highly subjective in nature and may offend many
employees. Therefore, a more scientific and fruitful way of job evaluation is called for.
2. Classification Method
According to this method, a predetermined number of job groups or job classes are
established and jobs are assigned to these classifications. This method places groups
of jobs into job classes or job grades. Separate classes may include office, clerical,
managerial, personnel, etc. Following is a brief description of such a classification in an
office.
Class I - Executives: Further classification under this category may be Office
Manager, Deputy office manager, Office superintendent, Departmental supervisor, etc.
Class II - Skilled workers: Under this category may come the Purchasing assistant,
Cashier, Receipts clerk, etc.
Class III - Semiskilled workers: Under this category may come Stenotypists,
Machine-operators, Switchboard operator etc.
Class IV - Unskilled workers: This category comprises Daftaris, File clerks, Office
boys, etc.
The job classification method is less subjective when compared to the earlier ranking
method. The system is very easy to understand and acceptable to almost all employees
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without hesitation. One strong point in favour of the method is that it takes into account Notes
all the factors that a job comprises. This system can be effectively used for a variety of
jobs. The weaknesses of the job classification method are:
Even when the requirements of different jobs differ, they may be combined into a
single category, depending on the status a job carries.
It is difficult to write all-inclusive descriptions of a grade.
The method oversimplifies sharp differences between different jobs and different
grades.
When individual job descriptions and grade descriptions do not match well, the
evaluators have the tendency to classify the job using their subjective judgements.
A more systematic and scientific method of job evaluation is the factor comparison
method. Though it is the most complex method of all, it is consistent and appreciable.
Under this method, instead of ranking complete jobs, each job is ranked according to
a series of factors. These factors include mental effort, physical effort, skill needed,
responsibility, supervisory responsibility, working conditions and other such factors (for
instance, know-how, problem solving abilities, accountability, etc.). Pay will be assigned
in this method by comparing the weights of the factors required for each job, i.e., the
present wages paid for key jobs may be divided among the factors weighted by importance
(the most important factor, for instance, mental effort, receives the highest weight). In other
words, wages are assigned to the job in comparison to its ranking on each job factor.
The steps involved in factor comparison method may be briefly stated thus:
Select key jobs, representing wage/salary levels across the organisation. The
selected jobs must represent as many departments as possible.
Find the factors in terms of which the jobs are evaluated (such as skill, mental effort,
responsibility, physical effort, working conditions, etc.).
Rank the selected jobs under each factor (by each and every member of the job
evaluation committee) independently.
Assign money value to each level of each factor (example: consider problem solving
is one of the factors, what level of problem solving is required {basic, intermediate or
advance}) and determine the wage rates for each key job. The wage rate for a job is
apportioned along the identified factors.
All other jobs are compared with the list of key jobs and wage rates are determined.
An example of how the factor comparison method works is given below:
After the wage rate for a job is distributed along the identified and ranked factors,
all other jobs in the department are compared in terms of each factor. Suppose the job
of a 'painter' is found to be similar electrician in skill (15), fitter in mental effort (10), welder
in physical effort (12) cleaner in responsibility (6) and labourer in working conditions (4).
The wage rate for this job would be (15+10+12+6+4) is 47.
4. Point Method
This method is widely used currently. Here, jobs are expressed in terms of key
factors. Points are assigned to each factor after prioritizing each factor in order of
importance. The points are summed up to determine the wage rate for the job. Jobs with
Notes similar point totals are placed in similar pay grades. The procedure involved may be
explained thus:
1. Select key jobs. Identify the factors common to all the identified jobs such as
skill, effort, responsibility, etc.
2. Divide each major factor into a number of sub factors. Each sub factor is defined
and expressed clearly in the order of importance, preferably along a scale.
The most frequent factors employed in point systems are (i) Skill (key factor);
Education and training required, Breadth/depth of experience required, Social skills
required, Problem-solving skills, Degree of discretion/use of judgment, Creative thinking
(ii) Responsibility/Accountability: Breadth of responsibility, Specialized responsibility,
Complexity of the work, Degree of freedom to act, Number and nature of subordinate staff,
Extent of accountability for equipment/plant, Extent of accountability for product/materials;
(iii) Effort: Mental demands of a job, Physical demands of a job, Degree of potential stress.
The educational requirements (sub factor) under the skill (key factor) may be
expressed thus in the order of importance.
3. Find the maximum number of points assigned to each job (after adding up the
point values of all sub-factors of such a job).
This would help in finding the relative worth of a job. For instance, the maximum
points assigned to an officer's job in a bank come to 540. The manager's job, after adding
up key factors + sub factors points, may be getting a point value of say 650 from the
job evaluation committee. This job is now priced at a higher level.
4. Once the worth of a job in terms of total points is expressed, the points are
converted into money values keeping in view the hourly/daily wage rates. A wage survey
is usually undertaken to collect wage rates of certain key jobs in the organization.
2.19 Summary
Human capital management refers to the planning, organizing, directing and
controlling of procurement, development, competition, integration, maintenance and
separation of human resource to the end so that individual, organizational and social
objectives are accomplished.
Organisational behaviour can be defined as the understanding, forecasting and
management of human behaviour. This behaviour can be identifies both individually or in
a group that occurs within an organisation or company.
An Individual’s behaviour includes the study of individual’s personality, knowledge,
outlook, inspiration and job satisfaction. In the study of an Individual’s behaviour, we can
interact with other in order to study about them. This also helps us in making our
observation about them in detail.
Inter-individual behaviour is the study which is conducted through communication
between the employees among themselves. This can also be done with communication
between the employees and their subordinates. This helps in understanding each
individual’s leadership qualities, group dynamics, group conflicts, power and politics,
strengths, weaknesses etc.
Group behaviour is the study of the formation of organisation. It is also the study
of the structure of organisation and efficiency of organisation. Group behaviour helps in
understanding the group efforts made towards the achievement of organisation’s goal and
objectives. It refers to how a group behaves in an organisation.
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Structure refers to the layout or the design of an organisation or firm. It is the Notes
construction and arrangement of relationships, strategies according to the organisational
goals and objectives.
Organization development is a system-wide application of behavioral science
knowledge to the planned development and reinforcement of organizational strategies,
structures and processes for improving an organization’s effectiveness.
MBO is, a system wherein superior and subordinate managers of an organisation
jointly identify its common aims, define each individual’s major areas of responsibility in
terms of the results expected of him and use these measures as guides for operating
the unit, assessing the contribution benefits of its members.
Job enrichment, as currently practiced in industry, is a direct outgrowth of Herzberg's
Two Factor Theory of motivation. It is, therefore, based on the assumption that in order
to motivate personnel, the job itself must provide opportunities for achievement recognition,
responsibility, advancement and growth.
Job enlargement expands a job horizontally. It increases job scope; that is, it
increases the number of different operations required in a job and the frequency with which
the job cycle is repeated. By increasing the number of tasks an individual performs, job
enlargement increases the job scope, or job diversity.
A job evaluation is a systematic way of determining the value/worth of a job in relation
to other jobs in an organization. It tries to make a systematic comparison between jobs
to assess their relative worth for the purpose of establishing a rational pay structure.
Notes Job evaluation: Job evaluation is an assessment of the relative worth of various
jobs on the basis of a consistent set of job and personal factors, such as
qualifications and skills required.
In November 2012, Citigroup Inc. (Citigroup) in its filing with the US Securities and
Exchange Commission (SEC), declared that it would pay US$6.65 million in incentive
awards to its former CEO Vikram Pandit (Pandit), who had unexpectedly resigned from
his position in October 2012. The company also mentioned that it would pay its former
President and COO, John Havens, US$6.79 million. According to Michael O'Neill (O'Neill),
Chairman of Citigroup, Vikram steered Citi through the financial crisis, realigned its
strategy, bolstered its risk management processes and returned it to profitability.
John's focus on our institutional businesses increased our capabilities and helped
steer our clients through volatile times. Based on the progress this year through the date
of separation, the board determined that an incentive award for their work in 2012 was
appropriate and equitable.
In December 2007, Pandit was named as the CEO of Citigroup. He was credited
with successfully guiding the once struggling company during the financial crisis. Pandit
focused on rebuilding capital and restructuring the company. During his tenure, Citigroup
became profitable and was able to repay approximately US$45 billion in federal bailout.
Amity Directorate of Distance and Online Education
Human Capital 73
However, Pandit's efforts were not sufficient to convince regulators, shareholders, or Notes
the board members to retain him in the top position. According to media reports, the
Citigroup board was not pleased with Pandit's strategy and performance. On October 16,
2012, just a day after Citigroup reported strong quarterly results, Pandit resigned. He was
replaced by Michael L.Corbat (Corbat), Citigroup's former Chief of Operations in Europe,
the Middle East, and Africa. "Mike Corbat has demonstrated outstanding leadership
qualities and the ability to sharpen our focus on achieving strong, sustained operating
performance," said O'Neill.
Pandit's sudden departure came as a shock to the financial world. "I'm just as
surprised as anybody else. This may be a sign that he wants to move on and maybe
a sign that they're ready for the next era of leadership," said Robert Benmosche, CEO
at AIG . However, Pandit had few supporters who believed that he was the right person
for the job. According to Matthew H. Burrell, analyst at Wells Fargo & Company, "Corbat's
elevation strikes us as a positive for Citi, as it brings an experienced banker into the CEO's
role. We believe investors and possible regulators will benefit in the intermediate term from
their background as traditional bankers."
Question:
Do you think the CEO Succession Planning Issues at Citigroup is correct? Discuss.
2.26 Bibliography
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Integration of Vocational Education and Human Resources Development,
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approach. In D. G. Collings & G. Wood (Eds.), Human resource management:
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3. Johnason, P. (2009). HRM in changing organizational contexts. In D. G. Collings
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28 December 2011.
Notes 5. lrich, Dave (1996). Human Resource Champions. The next agenda for adding
value and delivering results. Boston, Mass.: Harvard Business School Press.
ISBN 0-87584-719-6. OCLC 34704904.
6. Azhar, Sarwar and ShehzadiIram. “Human Resource Outsourcing.” Proceedings
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Management and Technology Lahore, 27-28 February 2013. Lahore: School of
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Link. Web. 22 April 2014.
9. Murem Sharpe. “Outsourcing, organizational competitiveness, and work.”
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10. Vashistha, A. “Human resource outsourcing: emerging trends.” Global Services.
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