Unit 1: Introduction to Human Resource Management

 According to Adi Godrej,

“All corporate strengths are dependent on people”

 The real sources of competitive leverage are the culture and capabilities of your organization
that derive from how you manage your people

(a) Evolution of HRM

The Industrial Revolution

 Managing People at Work began at the time of the Industrial Revolution in the late 18 th century.
o Before this time few large organisations existed but with the emergence of new
technology, the factory system developed.
o The work environment was very unfavourable at this time and thousands of employees
worked long hours for little pay in difficult and often dangerous working conditions.
 Towards the end of the 19th, century Companies like ‘Cadbury’ in the UK and ‘Jacob’ In Ireland
voluntarily appointed welfare officers to improve working conditions and set up sick pay
schemes and subsidised housing.
 The early 20th century brought scientific management influenced by FW Taylor - who believed
there was ‘one best way’ to approach every job and organise the work process more efficiently
(Time-and-Motion study).
o Taylor analysed the job and broke it down into components i.e. job specialisation.
o Taylor believed that people could be trained to become an expert at one particular
component of the job but ignored that fact that people are not machines and get bored
doing the same job every day.
o Taylorism was most famously adopted by fast food companies and Ford and benefits
Human Resource Management with tools such as job analysis, methods of selection,
methods of training.

First World War

 Through the First World War, women were recruited in large numbers to fill the gaps left by the
men going to fight, which in turn meant reaching an agreement with unions to accept unskilled
women into craftsmen’s jobs and changing manning levels.
 During the 1920s and 1930’s the scope changed to manage absence, recruitment, dismissal and
bonus queries.
 The research of people like Elton May in the 1930s and ’40s indicated that performance could be
affected by motivation, job satisfaction, group dynamics and leadership style.
o This behavioural science began to influence the management of people as we
understood that a more flexible approach was required when dealing with different
people.
 o After the war, when the economy began picking up, large organisations saw value in
improving employee benefits as a way of recruiting, retaining and motivating
employees.

Second World War

 The Second World War brought about welfare and personnel work on a full-time basis that
largely involved implementing the rules demanded by large scale, state governed production
and thus the image of the emerging profession was a bureaucratic one.
 Following the development of poor industrial relations in the 1960s, employers, unions and
personnel managers were criticised for lacking negotiation skills and failing to plan industrial
relations or people development strategies.
 In the 1960s and 70s employment started to develop significantly.
o At the same time personnel techniques developed using theories from the social
sciences about motivation and organisational behaviour; selection testing became more
widely used, and management training expanded.
o During the 1970s, specialisms started to develop, with reward and resourcing, for
example, being addressed as separate issues.
 During the 1980s and 1990s, a time of worldwide recession, many business leaders recognised
that their employees were the key to competitive advantage. This belief, that people are a
resource to be managed as efficiently and effectively as any other resource, led to a shift in
management style which became known as Human Resource Management.

Human Resource Management at Present Age

 Human Resource Management means supporting employees at all stages of the employee life
cycle from recruitment, onboarding, performance management, coaching & training, career
planning & succession and separation.
 The profession of Human Resources is ever-evolving and challenging itself to behave
strategically and make an active contribution to businesses at the top table. This means that we
have to ensure that our focus is on improving business performance and driving shareholder
value.
 Maximising employee performance towards the achievement of strategic business objectives,
focusing on the implementation of policies and systems to reduce employee turnover and
potential loss of talent and knowledge.
 We work in the interest of achieving the business strategy by creating an environment that
allows the people to perform at their best.
 The Chartered Institute of Personnel and Development (CIPD) is our professional accrediting
body for HR and people development. They represent a worldwide community of more than
 135,000 members committed to championing better work and working lives by improving
practices in people and organisation development for the benefit of individuals, businesses,
economies, and society.
 The standard of education has increased, and employees expect better working conditions and
better treatment from employers.
 The legal governance around people management is ever-increasing and employers need to be
knowledgeable in this area to avoid and manage potential litigation.
 Furthermore, today’s workers are more likely to take an interest in the performance of their
organisation and often want to be involved in the decision-making that directly affects them.
 Organisations have changed too. Due to technological developments, change occurs more
quickly now, and an organisation must be able to adapt to the changing environment to survive.
An organisation’s ability to adapt to change and survive relies heavily on its employees.

The History of Modern HRM:

1. Early Philosophy (Before 1900)

2. Efficiency and Productivity Movement (1900-1920)
3. Period of Welfarism and Industrial Psychology (1920-1930)
4. Period of Human Relations (1930-1950)
5. Modern Times (After 1950).

Summing up, with the three important stages for growth of HRM are:

1. Labour Welfare Stage

 Scientific Management Approach (mid 1900s)
o Study of motion and fatigue
o ‘one-best-way’ to accomplish the task
o Piece-rate system
o Welfare programmes
o Failed to bring behavioural changes and increase in productivity

2. Personnel Management Stage

 Human Relations Approach (1930-1940)
o Effect of social and psychological factors
o Relations and respect → High Productivity

3. HRM Stage
 Human Resources Approach (1970s)
o Employees are assets
o Policies, programmes and practices – help in work and personal development
o Conducive environment
*To avoid the mistakes of the past, you must ask yourself what Human Resource strategies you have in
your business. Are your employees recruited, trained and managed in a way that ensures they perform
consistently at their best for your business?

(b) Objectives and Function of HRM

HRM function - focuses on the human and the management aspect of any organization.

1. To develop an effective coordination and communication within the organization.

2. To define an organizational structure which drives employee and organizational productivity.
3. To align and integrate individual and group goals with the organizational goals.
4. To identify and define the individual and group needs and necessities such as fair
wages/salaries, incentives concern, social security, recognition and rewards etc.
5. To strengthen and maintain a healthy relation between management and the organizational
workforce.
6. To continuously strengthen the human assets through proper training and development
programs.
7. To maintain a healthy relationship among the employees and to establish a favorable working
environment.
8. To motivate the employees and keep their morale high.
9. To manage employee and organizational data and to manage related compliances.

1. RECRUITING AND HIRING

Recruitment and Hiring process is one the important HR functions in any organization. Hiring and
recruiting talent is a crucial responsibility, also in the present day, HR is not only restricted to attending
job fairs and skimming resumes for potential candidates. Now, the HR department is also responsible for
workforce planning, writing job descriptions, advertising the opening, screening candidates, interviewing
candidates and assisting managers. In addition, talent management is a new horizon in recruiting and
hiring. The main objective here is to get the right people in the right place.

2. COMPENSATION & BENEFITS MANAGEMENT

Compensation management deals with shaping salary, benefits and incentives for the employees.
Moreover, the HR department is also responsible for defining the salary ranges and providing the
compensation according to the roles and responsibility assigned. The HR department working together
with front-line supervisors and managers, is responsible for setting strategies to ensure competitive and
equitable wages, salary, compensation, benefits and incentives.

Benefits are the form of compensation given to employees. Fringe benefits given in a job makes a job
competitively attractive and motivates employees. Examples are education benefits, holiday benefits,
child care benefits, health coverage, accommodation and travelling benefits etc. are essential benefits in
a workplace.

3. PERFORMANCE MANAGEMENT & EMPLOYEE MOTIVATION

HR departments are indulged in performance management of all the employees. It basically means
evaluating how employees are performing at individual and group level. Along with it, HR responsibility
includes motivating employees to perform well for which they create programs and plans.

Not only this, the HR department is responsible to take proper action to those who do not perform well
or violate policies. All disciplinary policies fall under performance management.

HR function evaluates the performance and determines the benefit packages for the employees.

4. PROFESSIONAL DEVELOPMENT AND TRAINING

The work environment is dynamic and its human nature to try things out of curiosity. Such behavior
leads humans to grow and learn new things. Employers, to capitalize this desire for growth and
development, need to orient training to the employees considering the changing environment. HR
function is responsible for training employees and improving the human competencies

For instance, training sessions, procedural orientations, strategy meetings, employee meetups, on and
off the job training, technical training etc. are regular in any organization. All such activities are HR
functions and contribute to professional development and training.
5. CAREER DEVELOPMENT

The support an organization provides to employee professional growth, especially to employees'

movement to a new position or project within the organization. This support often includes coaching,
mentoring, skills development, networking and career pathing.

6. EMPLOYEE RELATIONS

The HR department plays an important role by acting as a bridge between employee and employer.
They invest to make the employee-employer relation stronger. Also, employers share their expectation
to HR departments and employees can put their request to the employer via HR. Besides such direct
responsibility, the HR department is constantly looking for the benefit of the employer and employee.

7. CONDUCTING JOB ANALYSIS

It generally includes tracking an employee's duties and the duration of each task, observing the
employee performing his or her job, interviewing the employee, managers and others who interact with
the employee, and comparing the job to other jobs in the same department and job grade or job family.

8. WORKER SAFETY AND HEALTH

HR function is responsible for all the human-related issues in an organization. They are the authority to
look after the voices and actions of all the employees. For this purpose, worker’s safety is a prime
concern in today’s employment world. An ignorance can cost a huge sum of money to the company.
Therefore, the HR department regularly plans and implements policies and procedures that make
employees safe and the work environment healthier.

Also, when it comes to workers’ health, HR is concerned with the mental health of the employees.
Furthermore, activities like team gathering, counseling sessions, paid leaves, adjustable work hours etc.
are some small adaptations which lead to workers safety and health.

(c) Role and Responsibilities of HR Manager

HR manager - manages the rights and obligations of employees and helps them meet the goals of the
organization. Duties and responsibilities include hiring and firing, performance management, and
overseeing employee relations. A good HR manager makes sure all processes are working efficiently and
effectively so that operations can run as smoothly as possible.

HR managers are responsible for creating and managing a strong team. Whether it is human resource
planning, job analysis, hiring the right talent, or resolving conflicts within the organization, it’s the HR
manager who handles these tasks.

1. Human Resource Planning

HR managers are responsible for planning and achieving organizational objectives. They usually engage
in identifying, preparing, and executing business goals with top-level executives.
This proactive participation in planning enables HR managers to gain a thorough understanding of the
activities required to support the sustainable growth of the company. This, in turn, empowers HRs to
assign the right resources to the right project and ensures timely delivery.

2. Job Analysis and Design

As mentioned above, human resource planning requires assigning the right resources to the right
project. And if the right person is not in the organization, HR managers are responsible for designing the
job analysis to hire them.

A job analysis includes:

Job description
Employee’s position in the organization
Who the employee should report to
Resources the employee will need to perform the job efficiently
Individual data related to the post, such as technical skills, work experience, etc.
Work schedule
Salary and incentives
Personal attributes, such as personality, values, and interests

In addition to this, The responsibilities of the HR manager include:

Job rotation: Transferring employees from one task to another depending on the requirement and their
skills

Job enlargement: Merging previously distributed (similar) tasks into one job

Job enrichment: Adding more responsibility to an employee’s job

Creating high-performance working groups: Building teams to complete tasks that require high levels of
performance

3. Hiring Candidates

Finding and hiring the right talent is a very complex process. From screening potential candidates on job
portals and social platforms like LinkedIn to interviewing them, HR managers have to follow an
organized approach for hiring the best suitable employee for the organization.

Once an applicant is selected, HR managers design offer letter documents, scan to email them to the
candidate, and onboarding procedures. In case, a candidate backs out at the last moment, HR managers
are bound to convince them to join the organization. If they still insist not to, HR managers need to
repeat the hiring process to fill open positions.

An HR manager might also be responsible for a company’s employer brand reputation—or at minimum,
guiding the branding. Employer branding is a critical part of communicating a company’s culture and
work-life balance to potential employees. As more and more candidates search for open positions via
social media, managing employer brand is likely going to overlap with an HR manager’s job duties.

4. Training and Development

Hiring the best candidates is just half the job. HR managers need to train and upskill them to maximize
their return on investment.

The type of training and development new employees require depends on their experience.

HR managers are also answerable for the quality of training. If most of the recruits are unable to pass
the assessments, it indicates that either the trainer or the training program is not compliant with the
industry standard, for which the HR manager will be held accountable.

5. Design Workplace Policies

It is essential for HR managers to design workplace policies to reduce conflicts and legal issues, and
improve employee productivity. These policies are designed in a way that protects the interests of both
the employees and employers alike.

Though workplace policies differ from organization to organization, the things it includes remain the
same in every company, such as:

Standard operating procedures

Anti-harassment and non-discrimination

Paid leaves, sick leaves, and time-off benefits

Meal and break periods

Time tracking

Employee attendance and punctuality

HR managers also need to comply with federal, state, and local laws while designing workplace policies.
Some laws require managers to communicate the workplace policies in writing. If you are an HR
manager (or aspiring to be), make sure to stay on top of the local laws to avoid issues later.

6. Monitor Performance

Closely related to training, general HR roles and responsibilities include examining employee
performance records to identify the scopes of improvement and arranging training workshops to upskill
them.
By providing employees with a chance to learn something new and grow professionally, you can create a
positive environment and boost employee loyalty. Besides, improving your employees’ skills brings
additional benefits to the organization.

o First, they feel they are a vital part of the company

o Second, due to increased job satisfaction, they will give their best in each task

7. Maintaining Work Culture

HR roles & responsibilities shape and maintain organizational culture. It is essential to create a positive
impression of the company from day one, so the new employees know what to expect.

Besides, a person’s performance depends largely on the environment he is working in. You need to
instill a certain level of comfort to eliminate any stressful atmosphere that might affect employees’
performance.

Have an open-door policy so that employees can communicate their problems freely. This helps improve
employee job satisfaction and retain talent.

Consider planning company events (team buildings) where employees can showcase their non-work-
related talents like singing, dancing, acting, etc. It enhances the overall brand image and spreads
positivity throughout the organization.

8. Resolve Conflict

In every organization, employees come from diverse backgrounds. And when people with opposite
opinions meet, the chances of having a conflict rise significantly.

Whether the issue is between two employees or an employee and the management, it’s the HR
manager who has to intervene and resolve it.

The HR manager must listen to both parties without being biased or judgemental. They also need to go
to the root of the matter, which includes questioning other employees.

Depending on the type of conflict, HR managers also hold the right to fire an employee. However, this
situation usually arises in cases of harassment in the office.

9. Ensure Health and Safety of Employee

Employees are the asset of the organization. Unless they are safe and healthy, they won’t be able to give
their best to the company. Thus, HR managers need to ensure the health and safety of employees.
10. Rewards and Incentives

Lastly, HR managers need to reward employees based on their performance and other factors like
punctuality. The biggest benefit of rewarding workers is that it creates a desire for other employees to
excel at their job in the hope of getting incentives.

The type of rewards and incentives could be anything, such as holiday packages, a word of appreciation
and recognition, promotions, or bonuses.

Additionally, you can consider giving the power to employees to choose the type of reward they want.
Let them decide whether they want a bonus, flexible work times, leave, etc. It will make them feel
valued, increase job satisfaction, and boost productivity.

(d) Relevance of HRM

HRM plays a strategic role in managing people and the workplace culture and environment. If effective,
it can contribute greatly to the overall company direction and the accomplishment of its goals and
objectives.

A good HR department is critical to an employee-oriented, productive workplace in which employees

are energized and engaged. Below are some of the key reasons:

 HR monitors the culture. Some organizations say that HR owns the culture, but as in all other
employee relations matters, we recommend that the ownership is spread across all employees.
 HR owns the overall talent management processes. HR leads the way in management
development, performance management, succession planning, career paths, and other aspects
of talent management. HR can't do it alone however, HR has to bring new ideas and effective
practices into the organization.
 HR is responsible for the overall recruiting of a superior workforce. HR must provide leadership,
training, scheduling assistance, a systematic hiring process, recruitment planning processes,
interview expertise, selection monitoring, and more.
 HR recommends market-based salaries and develops an overall strategic compensation plan. HR
provides guidance to managers as they determine the salary ranges within their organizations.
 HR researches, recommends and implements employee benefits programs that attract and
retain your best employees.
 HR is responsible for recommending and instituting strategies for people and the organization
that further the attainment of the organization's strategic goals. If your organization is changing
direction, developing new products, changing mission, vision, or goals, HR must lead the way
with employee programs and processes.
 HR makes sure that workplace activities, events, celebrations, ceremonies, field trips, and team
building opportunities are occurring.
  HR advocates for employees who have issues or conflict with management and coaches
managers and executives who seek a more effective approach to working with particular
employees. Not everyone loves each other but they need to develop effective working
relationships with contributions and productivity. HR can help by knowing the players and taking
on the necessary role of advocate, coach and/or mediator.

The importance of HR is easily overlooked in the busy day-to-day in the workplace, but without
contributions in each of these areas, the organization would be less successful.

(e) Systems approach to HRM

 A system is an inter-related set of variables functioning together as a whole.

 A human resource management system (HRMS) is an integrated and interrelated approach to
managing human resources that fully recognizes the interdependence among the various tasks
and functions that must be performed.

Human Resource Management System

 It refers to the systems and processes at the intersection between human resource
management (HRM) and information technology (IT).
 It merges HRM as a discipline and in particular its basic HR activities and processes with the
information technology field.

Prior system approach to HR

 The function of Human Resources department is generally administrative and not common to all
organizations.
 Organizations may have formalized selection, evaluation and payroll processes.
 The HR function consists of tracking existing employee data which traditionally includes personal
histories, skills, capabilities, accomplishments and salary.

Purpose of System approach

 To reduce the manual workload in administrative activities.

  Organizations began to electronically automate many of these processes by introducing
specialized Human Resource Management Systems.

Human Resource Management Systems encompass:

 Payroll
 Work Time
 Benefits administration
 HR Management Information System
 Recruiting
 Training/Learning Management System
 Performance Record
 Employee Self-Service

Payroll

o The payroll module automates the payroll process.

o Data is generally fed from the human resources and time keeping modules to calculate
automatic deposit and manual cheque writing capabilities.
o This module can cover all employee-related transactions as well as integrate with existing
financial management systems.

Work Time

o The work time gathers standardized time and work related efforts.
o The most advanced modules provide broad flexibility in data collection methods, labour
distribution capabilities and the data analysis features has been outdated.
o Cost analysis and efficiency metrics are the primary functions.

Benefits Administration

o The benefits administration module provides a system for organizations to administer and
track employee participation in benefits programs.
o These typically include insurance, compensation, profit sharing and retirement

HR Management Information System

o The HR management module is a component covering many other HR aspects from

application to retirement.
o The system records basic demographic and address data, selection, training and
development, capabilities and skills management, compensation planning records and other
related activities.
o Human resource management function involves the recruitment, placement, evaluation,
compensation and development of the employees of an organization.

Recruiting

o Online recruiting has become one of the primary methods.

o Analysing personnel usage within an organization
o Identifying potential applicants.
o Recruiting through company-facing listings
o Recruiting through online recruiting sites or publications that market to both recruiters and
applicants.

Training

o The training module provides a system for organizations to administer and track employee
training and development efforts.
o The system normally called a Learning Management System (LMS).
o Courses offered in date specific sessions, with delegates and training resources being
mapped and managed within the same system.
o LMS allows managers to approve trainings, budgets and calendars alongside performance
management and appraisal metrics.

Employee Self-Service

o The Employee Self-Service module allows employees to query HR related data and perform
some HR transactions over the system.
o Employees may query their attendance record from the system without asking the
information from HR personnel.
o The system work without overloading the task on HR department.

E-HRM

o E-HRM is the planning, implementation and application of information technology for both
networking and supporting at least 2 individual or collective actors in their shared
performing of HR activities.
o E-HRM is not the same as HRIS/HRMS which refers to ICT systems used within HR
departments.
o E-HRM in essence is the delegation of HR functions to management and employees.
o These functions can be accessed typically via internet or other web-technology channels.
o Improve services to HR department clients (both employees and management)
o Improve efficiency and cost-effectiveness within the HR department.
o Allow HR to become a strategic partner in achieving organisational goals.