DIFFERENCE BETWEEN PERSONNEL MANAGEMENT (PM) AND

HUMAN RESOURCE MANAGEMENT

There are differences of opinion so far as the comparison between personnel

management (PM) and human resource management (HRM) is concerned. A number
of people, from students to managers to academics, mistakenly think that PM and
HRM are synonymous concepts. There are some others who treat the two concepts as
different. Hence, it is important to appreciate the difference between PM and HRM.
According to Goss HRM has three principal distinguishing features as compared to
PM. These are: emphasis not just on rule and contract but beyond them; focus on
strategy; and individualization of employee relations. A discussion on each of these
follows:

1. The assumptions underlying PM concepts emphasize clearly defined rules,

procedures and contracts. Adherance to these rules and procedures governs the
actions of the management. The relationship between the work force and the
management is governed by collective bargaining as well as employment
contracts. Especially collective bargaining becomes significant because
employees and management see and treat each other as having divergent
interests. Here, pluralism is respected as social value and the role of unions in
HR is considered legitimate . On the contrary, HRM emphasizes open ended
contracts, the terms of which are linked to the exigencies of business, conflict
is viewed as something pathological, resulting from negative inter-personal
relations rather than structural contradictions. Management assumes
responsibility to motivate employees and constantly inspires performance
based on commonality of goals.

2. PM does not focus on strategic management. Its main goal is peaceful or good
labour-management relations. Its function is mainly reactive. On the other
hand, HRM is a proactive function. It does not view labour-management
relations as an end in themselves. It is not only concerned with the present
organizational needs but anticipates future needs and then acts appropriately.
HRM also seeks to release the inner potential and creativity of people.
3. The edifice of PM is built on the collective agreement between the employees
and the management. Employees get standarized rewards based on job
evaluation. HRM leads to individualization of collective relations. Thus,
performance-related pay (PRP) is given key strategic emphasis. Pay is linked
with contribution made by an employee to the realization of organizational
goals. HRM seeks to develop the competencies of the employees so as to
derive benefit from this development for the organization, and to integrate
individual and organizational goals. Skill formation and developments are
recognized as the main hallmarks of HRD. The ultimate aim is to use the full
potential of human resources for serving the needs of customers and
developing organizational competencies

Some authors have developed these basic points into detailed differences as
shown in Table 1.1.

Table 1.1: Comparing HRM with PM

Dimensions PM HRM
a. Nature of relations Pluralist Unitarist or neo-unitarist
b. Perception of conflict Conflict is institutionalized Conflict is pathological
c. Contract Emphasis on compliance Beyond contract-
commitment
d. Role of procedures Rules dominated Culture and values
dominated
e. Planning perspective Ad hoc, reactive Integrated, proactive
f. Acceptability of Acceptable Not desirable
Unions
g. Level of trust Low High
h. Key relation Labour-management Customer
i. Management’s role Transactional Transformational
j. Basis of job design Division of labour Teams
k. Key people PM/IR specialists Line people and general
managers
l. Skill acquisition Training & Development Learning organization
m. Reward management Standardized job evaluation Performance related
Source: D.E. Guest: Human Resource Management and Industrial Relations, Journal
of Management Studies, 1987, Vol 24, pp. 503-522.

Represent the same to the management in his personal capacity.