HR Compendium

Department of Management Studies

INDIAN INSTITUTE OF TECHNOLOGY DELHI
(Institute of Eminence, Govt. of India)
HR COMPENDIUM

TABLE OF CONTENT
1. Human Resource Management 3
1. What is Human Resource Management 3
2. Objectives of HRM 3
3. Importance of HRM 4
4. Functions of Managers in Human Resource Management 5
2. Organizational Behaviour 6
1. Organizational Behaviour and Human Resource Management 6
2. Levels of Organizational Behaviour 6
3. Human Resource Processes 7
1. Human resource planning 7
2. Employee remuneration and Benefits Administration 8
3. Performance Management 8
4. Employee Relations 8
4. New Role of Human Resource Management 8
5. Human Resource Development (HRD) 10
1. Importance of HRD 10
6. Motivation Theories 10
1. Maslow's Hierarchy of Needs 10
2. McClelland's Acquired Needs Theory 11
3. Herzberg's Two Factor Theory 11
7. Personality 12
8. Big Five Model of Personality 13
1. What is personality 13
2. OCEAN 13
9. Changing trends in HR 14
10.Also Read About 16

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1. Human Resource Management

1.1. What is Human Resource Management
Many great scholars had defined human resource management differently and with different
words. Still, human resource management's core meaning deals with how to manage people
or employees in the organization.

Edwin Flippo defines- Human Resource Management as "planning, organizing, directing,

controlling of procurement, development, compensation, integration, maintenance, and
separation of human resources to the end that individual, organizational and social objectives
are achieved."

The National Institute of Personnel Management (NIPM) of India has defined human
resources – personal management as "that part of management which is concerned with
people at work and with their relationship within an enterprise. Its aim is to bring together
and develop into an effective organization of the men and women who make up enterprise
and having regard for the well – being of the individuals and of working groups, to enable
them to make their best contribution to its success".

According to DeCenzo and Robbins, "Human Resource Management is concerned with the
people dimension" in management. Since every organization is made up of people, acquiring
their services, developing their skills, motivating them to higher levels of performance, and
ensuring that they continue to maintain their commitment to the organization is essential to
achieve organizational objectives. This is true, regardless of the type of organization –
government, business, education, health or social action".

1.2. Objectives of HRM

The basic objective of human resource management is to contribute to the realization of
organizational goals. Some of its specific objectives are:
1. To ensure effective utilization of human resources because all other organizational
resources will be efficiently utilized by the human resources.
2. To establish and maintain an adequate organizational structure of relationship
among all the members of an organization by dividing the organization tasks into
functions, positions, and jobs, and by clearly defining the responsibility,
accountability, authority for each job and its relation with other jobs in the
organization.

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3. To generate maximum development of human resources within the organization by

providing them opportunities for advancement through training and development
opportunities.
4. To ensure reconciliation of individual/group goals with those of the organization so
that the personnel feels a sense of commitment and loyalty towards it.
5. To identify and satisfy the needs of individuals by offering monetary and non-
monetary rewards.
6. To ensure that legal, ethical, and social-environmental issues are suitably dealt with.
7. To create coordination and harmonious functionality within and between different
departments.

1.3. Importance of HRM

Human Resource Management has a place of great importance. Some of them are:
1. It helps management in the preparation, adoption, and continuing evolution of
personnel programs and policies.
2. It supplies skilled workers through a scientific selection process.
3. It ensures maximum benefit out of the expenditure on training and development and
appreciates the human assets.
4. It prepares workers according to the changing needs of industry and the environment.
5. It motivates workers and upgrades them to enable them to accomplish the
organization's goals.
6. It helps in reducing costs and helps in increasing productivity through innovation and
experimentation.
7. It contributes a lot in restoring industrial harmony and healthy employer-employee
relations.
8. It establishes mechanisms for the administration of personnel services that are
delegated to the personnel department.

Thus, human resource management is very important in an organization, and it should

not be undermined, especially in large scale enterprises. It is the key to the whole
organization and related to all other management activities, i.e., marketing,
production, finance, etc.

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1.4. Functions of Human Resource Management

The four basic functions of Human Resource Management are Planning, Directing,
Controlling, and Organizing.

i. Planning
A manager must plan to get things done by his subordinates. It is also important to plan 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.

ii. 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:
1. Grouping of personnel activities into functions or positions
2. Assigning different groups of activities to different individuals
3. Delegating authority according to the tasks assigned and responsibilities involved
4. Coordinating activities of different employees

iii. Leading
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 organization's goals. 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.

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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.

iv. 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.

2. Organizational Behaviour
Organizational behaviour is a term used to explain the concept of the behaviour of
individuals who constitute the human elements of an organization.

2.1. Organizational Behaviour and Human Resource Management

This is related to human resources, which is a concept that is used to describe the
management of the employees in any organization. From the description of the two terms, it
is easy to see how organizational behaviour (OB) and human resource management (HRM)
are related. Organizational behaviour looks at the individual behaviour, and then moves to
group behaviour, progressively to the organization behaviour, which we can also call the
organization culture. It requires skills to understand how the organization and its members
affect each other. Its areas include frameworks for diagnosing and resolving problems in
organizational settings. Thereby we can say that organizational behaviour (OB) is the study
of individual and group dynamics within an organization setting whereas human behaviour,
call it individual behaviour is a sub-set of organization behaviour.

2.2. Levels of Organizational Behaviour

Organizational behaviour is a relatively new, interdisciplinary field of study. Although it
draws most heavily from the psychological and sociological sciences, it also looks to other
scientific fields of study for insights.

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One of the main reasons for this interdisciplinary approach is because the field of
organizational behaviour involves multiple levels of analysis, which are necessary to
understand behaviour within organizations because people do not act in isolation. That is,
workers influence their environment and are also influenced by their environment.

•Individual Level of Analysis: At the individual level of analysis, organizational behaviour

involves the study of learning, perception, creativity, motivation, personality, turnover, task
performance, cooperative behaviour, deviant behaviour, ethics, and cognition. At this level
of analysis, organizational behaviour draws heavily upon psychology, engineering, and
medicine.
•Group Level of Analysis: At the group level of analysis, organizational behaviour involves
the study of group dynamics, intra-and intergroup conflict and cohesion, leadership, power,
norms, interpersonal communication, networks, and roles. At this level of analysis,
organizational behaviour draws upon the sociological and socio-psychological sciences.
•Organization Level of Analysis: At the organization level of analysis, organizational
behaviour involves the study of topics such as organizational culture, organizational
structure, cultural diversity, inter-organizational cooperation and conflict, change,
technology, and external environmental forces. At this level of analysis, organizational
behaviour draws upon anthropology and political science.

3. Human Resource Processes

The efficient designing of these processes apart from other things depends upon the degree
of correspondence of each of these. This means that each process is subservient to other. You
start from Human resource Planning and there is a continual value addition at each step. To
exemplify, the PMS (Performance Management System) of an organization like Infosys
would be different from an organization like Walmart.
3.1. Human Resource Planning: The process of recognizing and forecasting the
current and future human resource requirements of an organization to achieve its goals.

i. Recruitment: It aims at attracting applicants that match a certain job criterion.

ii. Selection: The next level of filtration. It aims at short listing candidates who are the
nearest match in terms qualifications, expertise and potential for a certain job.
iii. Hiring: Deciding upon the final candidate who gets the job.
iv. Training and Development: Those processes that work on an employee onboard
for his skills and abilities upgradation.

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3.2. Employee Remuneration and Benefits Administration: The process

involves deciding upon salaries and wages, Incentives, Fringe Benefits, and Perquisites, etc.
Money is the prime motivator in any job and, therefore, the importance of this process.
Performing employees seek raises, better salaries, and bonuses.
3.3. Performance Management: It is meant to help the organization train, motivate
and reward workers. It is also meant to ensure that the organizational goals are met with
efficiency. The process not only includes the employees but can also be for a department,
product, service, or customer process; all towards enhancing or adding value to them.
Nowadays, there is an automated performance management system (PMS) that carries all the
information to help managers evaluate the performance of the employees and assess them
accordingly on their training and development needs.
3.4. Employee Relations: Employee retention is a nuisance with organizations,
especially in industries that are hugely competitive in nature. Though there are myriad
factors that motivate an individual to stick to or leave an organization, certainly few are
under our control.
Employee relations include Labour Law and Relations, Working Environment, Employee
health and safety, Employee-Employee conflict management, Employee-Employee Conflict
Management, Quality of Work Life, Workers Compensation, Employee Wellness and
assistance programs, Counselling for occupational stress. All these are critical to employee
retention apart from the money, which is only a hygiene factor.

4. New Role of Human Resource Management

Human Resource Management in the New Millennium 'has undergone a great revolution by
questioning the accepted practices and re-inventing the organizations as well as structures.
Many traditional practices have been thrown out. As an example, it can be seen that
hierarchies are vanishing, and there is a greater emphasis on flat organizations. It means a
great deal of specialization and skills. It also means upgrading the norms and standards of
work as well as performance.
The new role of human resource management is much more strategic than before. Some of
the new directions of the role of HRM can be summed up as follows:
i. A Facilitator of Change: To carry people through upheaval requires the true
management of human resources.
ii. An Integrated Approach to Management: Rather than being an isolated
function, human resource is regarded as a core activity, one who shapes a company's
values. In particular, this can have an impact on customer service.

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iii. A Mediator: Establishing and balancing the new and emerging aspirations and
requirements of the company and the individual.
These changes, which are taking place, involve more commitment of the organization to the
development of people by improving performance and cutting costs.
As a result of this, the duration of tenure, which was traditionally long standing, is now
limited, future is becoming less certain, management opportunities are self-determined and
motivational factors are more concerned with enhancing future employability rather than
loyalty to the company and, at the same time, the rewards are going up in terms of higher
salaries. The future creative careers, will require a more involved approach to career
development, which will include:
i. Share employees with strategic partner organizations (customers of suppliers) in lieu
of internal moves.
ii. Encourage independence: Employees may go elsewhere for career development,
possibly to return in a few years.
iii. Fund-groups of employees to set-up as suppliers outside the organization.
iv. Encourage employees to think of themselves as a business and of the organization's
various departments as customers.
v. Encourage employees to develop customers outside the organization.
vi. Help employees develop self-marketing, networking and consultancy skills to enable
them to search out, recognize or create new opportunities for both themselves and the
organization.
vii. Identify skilled individuals in other organizations who can contribute on a temporary
project basis or part-time.
viii. Regularly expose employees to new people and ideas to stimulate innovation.
ix. Balance external recruitment at all levels against internal promotion to encourage open
competition, ―competitive tendering for jobs to discourage seeing positions as
someone's territory which causes self-protective conformity.
x. Foster more cross-functional teamwork for self-development.
xi. Eliminate the culture of valuing positions as career goals in favour of portraying a
career as a succession of bigger projects, achievements and new skills learned. The
concept of position is part of the outside static concept of the organization. Positions
are out. Processes and projects are in.
xii. Abandon top-down performance appraisal in favour of self-appraisal based on internal
customer satisfaction surveys and assessing people as you would suppliers.
xiii. Replace top-down assessment processes with self-assessment techniques and measure
performance in term of results.

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5. Human Resource Development (HRD)

Human resource development management identifies, nurtures and uses the abilities of the
employees working for the company. They are there to create a suitable climate for their
people to help them and the companies develop. It creates a structure for helping the
employees of the organization in developing their organizational and personal abilities,
know-how and skills.
The HR department of an organization that is growth-oriented creates opportunities for
employees to know and develop their skills through employee training, career development
program of the employee, managing their performance, coaching, monitoring, identifying
key employees.
Human resource development focuses on creating a very useful work culture by developing a
very efficient workforce that both the organization and the employee obtain their own career
goals to serve their customers better.
5.1 Importance of HRD
HRD is a continuous and planned manner in which the employees of an organization are
guided to perceive the following points:

1.To gain and polish their abilities that are required to execute different roles which are
related to their existing and future job responsibilities to help them perform well.
2. To help the employees develop their inner potential and also learn new ones by learning
how to explore their own capabilities for self as well as organizational development.

3. To develop the organizational culture in which the relationship between the supervisor and
the subordinate contributes to collaboration amongst different units in the organization with
teamwork and strong contribution of professional well-being by motivating the employees.

6. Motivation Theories
6.1. Maslow's Need Hierarchy Theory
Maslow's hierarchy of needs is a motivational theory in psychology comprising a five-tier
model of human needs, often depicted as hierarchical levels within a pyramid.
Maslow stated that people are motivated to achieve certain needs and that some needs take
precedence over others. Our most basic need is for physical survival, and this will be the first
thing that motivates our behaviour. Once that level is fulfilled the next level up is what
motivates us, and so on. This five-stage model can be divided into deficiency needs and

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growth needs. The first four levels are often referred to as deficiency needs (D-needs), and
the top-level is known as growth or being needs (B-needs).
The original hierarchy of needs five-stage model includes:
1. Biological and Physiological Needs: Air, food, drink, shelter, warmth, sex, sleep.
2. Safety Needs: Protection from elements, security, order, law, stability, freedom from fear.
3. Love and belongingness Needs: Friendship, intimacy, trust, and acceptance, receiving
and giving affection and love. Affiliating, being part of a group (family, friends, work).
4. Esteem needs: Which Maslow classified into two categories: (i) esteem for oneself
(dignity, achievement, mastery, independence) and (ii) the desire for reputation or respect
from others (e.g., status, prestige). Maslow indicated that the need for respect or reputation is
most important for children and adolescents and precedes real self-esteem or dignity.
5. Self-actualization needs: Realizing the personal potential, self-fulfillment, seeking
personal growth, and peak experiences. A desire "to become everything one is capable of
becoming."
6.2. McClelland's Acquired Needs Theory
David McClelland's Human Motivation Theory gives a way of identifying people's
motivating drivers. This can then help to give praise and feedback effectively, assign them
suitable tasks, and keep them motivated. Some needs are acquired as a result of life
experiences.
1. Need for achievement: Accomplish something difficult.
2. Need for affiliation: Form close personal relationships.
3. Need for power: Control others.

6.3. Herzberg's Two Factor Theory

According to Herzberg, two kinds of factors affect motivation, and they do it in different
ways:
1. Hygiene Factors: These are factors whose absence motivates but whose presence has no
perceived effect. They are things that when you take them away, people become dissatisfied
and act to get them back. Examples include decent working conditions, security, pay,
benefits (like health insurance), company policies, interpersonal relationships.

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2. Motivators: These are factors whose presence motivates. Their absence does not cause
any particular dissatisfaction; it just fails to motivate. So, hygiene factors determine
dissatisfaction, and motivators determine satisfaction. The two scales are independent, and
you can be high on both.

7. Personality
Personality Framework- MBTI
In a nutshell, Myers Briggs theory talks about four preferences:
1. People and things (Extraversion or "E"), or ideas and information (Introversion or "I").
2. Facts and reality (Sensing or "S"), or possibilities and potential (Intuition or "N").
3. Logic and truth (Thinking or "T"), or values and relationships (Feeling or "F").
4. A lifestyle that is well-structured (Judgment or "J"), or one that goes with the flow
(Perception or "P").

In Myers Briggs theory, for each pair, one prefers one style more than the other. You
combine the letters associated with your preferences to get your Myers Briggs
personality type. For example, having preferences for E, S, T, and J gives a personality
type of ESTJ. Although you have preferences, you still use all eight styles- in the same
way, that most people are right-handed, but they still use both hands.
1. Extraversion and Introversion: The first pair of styles are concerned with the
direction of your energy. If you prefer to direct your energy to deal with people,
things, situations, or "the outer world," then your preference is for Extraversion. If you
prefer to direct your energy to deal with ideas, information, explanations or beliefs, or
"the inner world," then your preference is for Introversion.
2. Sensing and Intuition: The second pair concerns the type of information/things that
you process. If you prefer to deal with facts, what you know, to have clarity, or to
describe what you see, then your preference is for Sensing. If you prefer to deal with
ideas, look into the unknown, generate new possibilities, or to anticipate what isn't
obvious, then your preference is for intuition. The letter N is used for intuition because
It has already been allocated to Introversion.
3. Thinking and Feeling: The third pair reflects your style of decision-making. If you
prefer to decide on the basis of objective logic, using an analytic and detached
approach, then your preference is for Thinking. If you prefer to decide using values -
i.e., on the basis of what or who you believe is important - then your preference is for
Feeling.

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4. Judgment and Perception: The final pair describes the type of lifestyle you adopt. If
you prefer your life to be planned and well-structured, then your preference is for
Judging. This is not to be confused with 'Judgmental', which is quite different. If you
prefer to go with the flow, to maintain flexibility and respond to things as they arise,
then your preference is for perception.
When you put these four letters together, you get a personality type code—having four pairs
to choose from means there are sixteen Myers-Briggs personality types..

8. Big Five Model of Personality

8.1. What is Personality?
Personality is an easy concept to grasp for most of us. It's what makes you "you". It
encompasses all the traits, characteristics, and quirks that set you apart from everyone else.
Human resources professionals often use the Big Five personality dimensions to help place
employees. That is because these dimensions are considered to be the underlying traits that
make up an individual's overall personality. The Big Five traits are Openness,
Conscientiousness, Extroversion, Agreeableness, and Neuroticism.
8.2. OCEAN
1. Openness: People who like to learn new things and enjoy new experiences usually score
high in openness. Openness includes traits like being insightful and imaginative and having a
wide variety of interests.
2. Conscientiousness: People that have a high degree of conscientiousness are reliable and
prompt. Traits include being organized, methodic, and thorough.
3. Extraversion: Extraverts get their energy from interacting with others, while introverts
get their energy from within themselves. Extraversion includes the traits of being energetic,
talkative, and assertive.
4. Agreeableness: These individuals are friendly, cooperative, and compassionate. People
with low agreeableness may be more distant. Traits include being kind, affectionate, and
sympathetic.
5. Neuroticism: Neuroticism is also sometimes called Emotional Stability. This dimension
relates to one's emotional stability and degree of negative emotions. People that score high
on neuroticism often experience emotional instability and negative emotions. Traits include
being moody and tense.

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9. Changing trends in HR
Digital is the Key
As more millennials join the organized workforce, HR is employing analytics to understand
the needs of people in a more customized, individual-specific manner and provide solutions
through the use of mobile technology and newer platforms. The possibilities are endless:
mobile-friendly platforms for communication, performance management, continuous
feedback and pulse surveys, easier HR systems, automated processes, chatbots, and more.
1. What is HR Analytics?
As HR has become more aligned with the business, evidence-based HR and HR analytics are
increasingly important. Without rigorously tracking HR investments and outcomes, HR
decisions and priorities remain whims, not science. With HR analytics, line managers and
HR professionals can better justify, prioritize and improve HR investments. While many HR
decisions require insight and judgment, improved HR metrics helps HR move towards
professional respectability and decision – making rigor.
Mobile Recruitment
Mobile recruitment represents one of this year's game-changing hiring trends. In fact,
statistics show that more than 70% of candidates visit a company's website via their mobile
device to check out career opportunities, and almost 50% used their phones to apply for an
open position.
Big Data & HR Analytics:
Big Data in HR refers to the use of the many data sources available to your organization,
including those not traditionally thought of in HR; advanced analytic platforms; cloud-based
services; and visualization tools to evaluate and improve practices including talent
acquisition, development, retention, and overall organizational performance. This involves
integrating and analyzing internal metrics, external benchmarks, social media data, and
government data to deliver a more informed solution to the business problem facing your
organization. Using these tools, HR organizations are able to perform analytics and
forecasting to make smarter and more accurate decisions, better measure efficiencies, and
identify management "blind spots."

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2. What are some of the next generation HR metrics which need to be focused on for
the better performance of HR in organizations?
i.) The end of HR is to create value; improved HR analytics are a means to help codify and to
add value. Some companies are so concerned about the HR scorecard or dashboard that they
make metrics the end, not the means. Effective HR metrics means doing more predictive
than descriptive analytics. Descriptive analytics have scorecards and dashboards that can be
used for comparisons across time or with others. Predictive statistics emphasize a path with
lead indicators and outcomes of interest.
ii.) Avoid measuring what is easy and focus on measuring what is right. Just because
something can be measured does not mean it should be. In the past, HR would measure
activities (e.g., how many managers received 40 hours of training or how much people liked
attending a training program). In the future, we need to measure the outcomes of those
activities. When focusing on outcomes, it is important to have a clear sense of what the
desired outcomes of HR should be.
iii.) Third, keep measures simple and focused on decisions. Too often, the desire to quantify
HR leads to more HR data than insight. Turning valid data into thoughtful decisions should
be the focus of HR analytics. Sometimes this starts with data, when HR information
warehouses about employee attitudes, turnover, compensation, performance, and so forth can
be used to improve decision-making. In these cases, HR professionals need to learn how to
cull key messages and trends from the data. Turning complex data into simple messages
requires that HR professionals can see stories in the information warehouses they access to
make more informed decisions.
iv.) Fourth, keep ownership and accountability of HR analytics with line managers. Line
managers are the ultimate owners of HR work; they have final accountability for what is
done and how well it is done. HR professionals are architects who build blueprints for
actions and layout choices that can be made. To gain line manager buy-in and support for
HR analytics, it is important to involve line managers in determining the goals of the HR
metrics, in defining which HR metrics should be used, and applying those metrics for
improved decision–making.
3. What is gamification, its use in learning and development?
Gamification is the process of enabling the participants to learn in the learning and
development scenarios through applying games and make it more engaging for the learner.
In this process, the learner competes with the co-participants or participates individually and,
through this interactive exercise, learns and earns rewards for his/her performance. Digital
gaming technology, which has been fast-growing, is used for the purpose of implementing

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gamification in learning. The technological development in HR has helped in implementing

e-learning techniques in different organizations, but the usage of gaming is a completely
different and new concept that is still evolving. There are many computer/
online/smartphone-based games available in the market for organizations to impart training
to their employees, but the ones which lead to the effective development of employees are
those which are aligned with the business objectives. So, identifying the requirements is the
first step to be carried out before a company implements this process. After identifying, the
company can collaborate with game developers to identify/ develop (if necessary) games that
would be suitable to the company's requirements. The design should be such that the actions
and achievements are visible to the trainees and not just entertaining.

Also Read About

HR Role During and Post COVID
https://www.mckinsey.com/~/media/McKinsey/About%20Us/COVID%20Response%20Center/PDFs/CHRO-
COVID-19-response-checklists.pdf

https://hbr.org/sponsored/2020/05/workforce-strategies-for-post-covid-19-recovery

https://hbr.org/2020/08/how-hr-leaders-can-adapt-to-uncertain-times

HR Roles of the Future

https://hbr.org/2020/08/21-hr-jobs-of-the-future

https://www.mckinsey.com/business-functions/organization/our-insights/hr-says-talent-is-crucial-for-
performance-and-the-pandemic-proves-it

HR and Automation
https://www.mckinsey.com/business-functions/organization/our-insights/the-organization-blog/human-
resources-in-the-age-of-automation

Miscelleneous Reads
https://www.mckinsey.com/business-functions/organization/our-insights/the-ceos-guide-to-competing-
through-hr

https://www.mckinsey.com/business-functions/organization/our-insights/the-organization-blog/an-agile-
hr-leads-to-happier-employees

ALL THE BEST!

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