Human Resource

Management

Prepared by: Teresa Dimaculangan

Week 1

The Environment of Human Resource Management

What is Human Resource Management

Human Resource Management (HRM or HR) is the strategic approach to the effective
management of people in a company or organization such that they help their business gain a
competitive advantage. ... The overall purpose of human resources (HR) is to ensure that the
organization is able to achieve success through people.
Human Resource Management involves management functions like planning, organizing,
directing and controlling
Functions of Human Resource Management

 Planning

 Organizing

 Directing

 Controlling
Planning
A manager must plan ahead in order to get things done by his subordinates. It is also important
to plan in order to give the organization its goals.

Also, planning helps establish the best procedures to reach the goals. Further, some effective
managers devote a substantial part of their time to planning.

With respect to the human resource department, planning involves determining the personnel
programs that can contribute to achieving the organization’s goals.

These programs include anticipating the hiring needs of the organization, planning job
requirements, descriptions, and determining the sources of recruitment.

Organizing
After the human resource manager establishes the objectives and develops plans and programs
to achieve them, he needs to design and develop the organization’s structure to carry out the
different operations. Developing the organization’s structure includes:
  Grouping of personnel activity into functions or positions

 Assigning different groups of activities to different individuals

 Delegating authority according to the tasks assigned and responsibilities involved

 Coordinating activities of different employees

Directing
The HR Manager can create plans, but implementing the plans smoothly depends on how
motivated the people are. The directing functions of HRM involve encouraging people to work
willingly and efficiently to achieve the goals of the organization. In simpler words, the directing
functions of HRM entail guiding and motivating people to accomplish the personnel programs.

The HRM can motivate the employees through career planning and salary administration by
boosting the employee’s morale, developing relationships, providing safety requirements, and
looking after the welfare of employees.

In order to do this effectively, the HRM must identify the needs of the employees and the means
and methods to satisfy them. Motivation is a continuous process as employees have new needs
and expectations when the old ones are satisfied.
Controlling
Controlling is all about regulating activities in accordance with the plans formulated based on the
objectives of the organization. This is the fourth function of the HRM and completes the cycle. In
this, the manager observes and subsequently compares the results with the set standards.

Further, he corrects any deviations that might occur. Controlling is one of the important functions
of HRM as it helps him evaluate and control the performance of the department with respect to
different operative functions. It also involves appraisals, audit, statistics, etc.

 It involves procurement, development, maintenance of human resource

 It helps to achieve individual, organizational and social objectives
 Human Resource Management is a multidisciplinary subject. It includes the study of
management, psychology, communication, economics and sociology.
 It involves team spirit and team work.
 It is a continuous process.

Theoretical Bases of Human Relations School of Thought

The human relations theory of management began development in the early 1920s. Today, it is
integral to every business, and understanding the involved skills and theories is key to
employee success.

In the 1920s, Elton Mayo, an Australian-born psychologist and organizational theorist, began his
research on the behavior of people in groups and how it affects individuals in the workplace,
known as the Hawthorne studies. 

At the time, Taylorism, or the application of science in the workplace to improve productivity,
viewed individuals as machines that could work in unethical or unrealistic environments. Mayo,
in contrast, popularized the idea of the "social person," meaning organizations should treat
people as individuals – not machines – with individual needs. 

The human relations management theory is a researched belief that people desire to be part of
a supportive team that facilitates development and growth. Therefore, if employees receive
special attention and are encouraged to participate, they perceive their work as having
significance and are motivated to be more productive, resulting in high-quality work.

Strategic View Of Human Resource Management

Strategic human resource management is the connection between a company's human

resources and its strategies, objectives, and goals. The aim of strategic human resource
management is to: Advance flexibility, innovation, and competitive advantage. Develop a fit for
purpose organizational culture.

What is strategic human resource management?

Strategic human resource management is the connection between a company’s human

resources and its strategies, objectives, and goals. The aim of strategic human resource
management is to:

 Advance flexibility, innovation, and competitive advantage.

 Develop a fit for purpose organizational culture.
 Improve business performance.

In order for strategic human resource management to be effective, human resources (HR) must
play a vital role as a strategic partner when company policies are created and implemented.
Strategic HR can be demonstrated throughout different activities, such as hiring, training,
and rewarding employees.

Strategic HR involves looking at ways that human resources can make a direct impact on a
company’s growth. HR personnel need to adopt a strategic approach to developing and
retaining employees to meet the needs of the company’s long-term plans.

HR issues can be a difficult hurdle to cross for many companies, there are all kinds of different
components that can confuse business owners and cause them to make ineffective decisions
that slow down the operations for their employees as well as their business.

Changing Landscape of Human Resource Management

Encompassing the people that make up a company’s workforce, Human Resources are
an integral part of any organization, responsible for the screening of new potential
employees, as well as the training and general well-being management of its current
ones. An HR Department monitors and controls payroll, as well as employee benefits
and happiness. However, the management of these resources has changed drastically
over the last 10-20 years, with the advances in technology such as automation and
artificial intelligence making work HR more somewhat more efficient, yet taking a human
aspec

The Landscape is Changing

HR is arguably overlooked at times, with many companies opting to make cuts in the
area to save money. With the competitive nature of   business, there is always a desire
to reduce costs; HR often falls victim to this. One way corporations may choose to save
money is by reducing the human workforce and installing new AI systems.

Like many aspects of modern-day businesses and organizations, these new

technologies are dictating the direction HR management is taking. AI technologies and
more advanced computer programmes are simplifying many employee management
processes, such as training and pay.

Recruitment is also managed much more profusely by computer systems, with the
internet being one of the best sources of new employees. Online AI monitored
questionnaires can filter through potential good and bad candidates at a much faster
rate.

HR is also evolving in relation to common tasks HR staff are expected to complete, and
the way these are managed.

In an efficient, productive HR team, a significant amount of time will be attributed to

strategic planning, and the implementation of procedure and policy to maximize output.
Many large corporations place great emphasis on this.

However, many HR staff will find themselves focusing on menial supervision tasks, such
as the supervision of standard procedures. It is suggested that new systems to deal with
strategic planning are resulting in a change in tasks for some HR departments.

AI HR replacements seem here to stay, resulting in a lack of productive tasks to carry

out for remaining HR staff.

The Human Resource Management Model

The Fombrun, Tichy and Devanna Model

Being the first model (dates back to 1984), this emphasizes just four functions and their
interrelatedness. The four functions are: selection, appraisal, development and rewards.
These four constituent components of human resource management and are expected
to contribute to organizational effectiveness.

The Fombrun model is incomplete as it focuses on only four functions of HRM and
ignores all environmental and contingency factors that impact HR functions.p

The Harvard Model

The Harvard model claims to be comprehensive in as much as it seeks to comprise six critical
components of HRM. The dimensions included in the model are: stakeholders, interests,
situational factors, HRM policy choices, HR outcomes, long-term consequences and a feedback
loop through. The outputs flow directly into the organization and the stakeholders.
The Guest Model

Yet another human resource management model was developed by David Guest in 1997 and
claims to be much superior to other models. The details will justify the claim. This model claims
that the HR manager has specific strategies to begin with, which demand certain practices and
when executed, will result in outcomes. These outcomes include behavioral, performance
related and financial rewards.

The model emphasizes the logical sequence of six components: HR strategy, HR practices, HR
outcomes, behavioral outcomes, performance results and financial consequences. Looking
inversely, financial results depend on employee performance, which in turn is the result of action
oriented employee behaviors. Behavioral outcomes are the result of employee commitment,
quality and flexibility, which, in turn are impacted by HR practices. HR practices need to be in
tune with HR strategies which are invariably aligned with organizational strategies.

The claim of the Guest model that it is superior to others is partly justified in the sense that it
clearly maps out the field of HRM and delineates the inputs and outcomes. But the dynamics of
people management are so complex that no model (including the Guest model) can capture
them comprehensively.

The Warwick Model

This model was developed by two researchers, Hendry and Pettigrew of University of Warwick
(hence the name Warwick model). Like other human resource management models, the
Warwick proposition centers around five elements

 Outer context (macro environmental forces)

 Inner context (firm specific or micro environmental forces)

 Business strategy content.

 HRM content

 HRM context

The Warwick model takes cognisance of business strategy and HR practices (as in the Guest
model), the external and internal context (unlike the Guest model) in which these activities take
place, and the process by which such changes take place, including interactions between
changes in both context and content. The strength of the model is that it identifies and classifies
important environmental influences on HRM. It maps the connection between the external and
environmental factors and explores how human resource management adapts to changes in the
context. Obviously, those organizations achieving an alignment between the external and
internal contexts will achieve performance and growth.

Activity 1
Answer the following questions.

1. Define and explain human resource management.

2. Define and explain the four functions of human resource management.
3. Define and explain the four HRM model.