HUMAN RESOURCES

SEED PREPARATORY KIT

2020

Research and Scholastic Development Team

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TABLE OF CONTENTS

A. HUMAN RESOURCE MANAGEMENT…………………………………………….6

➢ What Is Human Resource Management?
➢ Functions in Human Resource Management
➢ Significance Of HRM
➢ Companies, People Integral To HR
➢ Evolution Of HRM

B. ORGANIZATIONAL BEHAVIOUR…………………………………………………11
➢ What is Organizational Behaviour?
➢ Relevance of OB in HRM
➢ OB: Individual
1. Emotional Intelligence
2. Personality Type
Myers-Briggs Type Indicator
The Big Five Personality Model
3. Perception
Factors that influence perception:
Barriers to Social Perception
Attribution Theory
4. Theories of Motivation That Describe and Govern Individual Organizational
Behaviour
Maslow’s Hierarchy of needs
Theory of X and Y
Herzberg's Motivation-Hygiene Theory
McClelland’s Theory of Needs
Alderfer’s ERG theory
Goal Setting Theory by Edwin Locke
Skinner’s Reinforcement Theory
Vroom’s Expectancy Theory
Adam’s Equity Theory

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 ➢ OB: Group
➢ Leadership

C. EMPLOYEE LIFE CYCLE………………………………………………………...26

➢ Attract
➢ Hire
➢ Onboard
➢ Develop
➢ Engage
➢ Off-board

D. INDUSTRIAL RELATIONS AND LABOUR LAWS…………………………….29

➢ Stakeholders in an IR System
➢ Industrial Disputes Act, 1947
➢ The Factories Act, 1948
➢ Overview of Other IR Acts and Recent Amendments
1. The Maternity Benefits Act, 1961
2. The Contract Labour (Regulation & Abolition) Act, 1970
3. The Child Labour (Prohibition and Regulation) Amendment Act, 2016
4. Sexual Harassment at Workplace Act,2013

E. HUMAN RESOURCE PLANNING………………………………………………...47

➢ Concept and overview
➢ Job Analysis, Job description and Job Design

F. RECRUITMENT AND SELECTION………………………………………………51

➢ Differences Between Recruitment & Selection
➢ Types of Recruitment
➢ Selection Process

G. TALENT MANAGEMENT………………………………………………………….54
➢ Seven Keys to Effective Talent Management
➢ Competency
➢ Competency Mapping
➢ Engaged, Disengaged and Actively Disengaged Employees
➢ Difference Between Employee Turnover and Attrition
➢ Knowledge, Skills & Abilities (KSA)

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H. LEARNING AND DEVELOPMENT…………………………………………….58
➢ Definition of Training
➢ Definition of Development
➢ Differences between Training & Development
➢ On the Job Training Methods
➢ Off the Job Training Methods
➢ Differences between Mentoring and Coaching
➢ Learning Theories
➢ Instructional Design
➢ Future Trends for Learning & Development

I. PERFORMANCE MANAGEMENT……………………………………………….69
➢ Concept & Overview
➢ Steps in The Performance Management Cycle
➢ 360 Degree Feedback
➢ Bell Curve Method
➢ Modern Methods of Performance Management

J. COMPENSATION AND BENEFITS……………………………………………….75

➢ Total Rewards
➢ The Aon Hewitt Total Reward Framework
➢ Difference between Wages and Salary
➢ Components of Compensation
➢ Components of Benefits

K.CORPORATE SOCIAL RESPONSIBILTY………………………………………79

➢ Concept and Overview
➢ CSR Initiatives by Companies

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L. MISCELLANEOUS TOPICS…………………………………………………84
➢ Employer Branding
➢ Human Resources Information System (HRIS)
➢ Employee Value Proposition (EVP)
➢ HR Analytics
➢ HR Consulting
➢ Industry 4.0
➢ Blockchain
➢ Change Management

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A. HUMAN RESOURCE MANAGEMENT

What Is Human Resource Management?

Every organization’s desire is to have skilled and competent people to make their organization more effective
than their competitors. The core purpose of the human resource management is to make efficient use of
existing human resource in the organization.
Human Resource Management (HRM) is the term used to describe formal systems devised for the
management of people in a structured and thorough manner within an organization. Human Resource
management includes following practices: Human Resource Planning, Recruitment & Selection, Training &
Development, Compensation & Benefits etc.
Different Functions of Human Resource Management
The major functions of Human Resource Management are divided into following:
1. Managerial Functions
2. Operative Functions

Functions of
HRM

Managerial Functions Operative Functions

1. Planning 1. Procurement
2. Organizing 2. Development
3. Staffing 3. Compensation
4. Directing 4. Maintenance and Motivation
5. Controlling 5. Integration

1. MANAGERIAL FUNCTIONS
i. Planning: In the human resource planning function, planning means determination of personnel programs
that will contribute to the goals of an organization i.e. anticipating vacancies, demand and supply forecasting,
job descriptions and determination of source of recruitment.

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ii. Organizing: Once the plans are formulated, the next step is to organize the men and material in order to
accomplish those plans. Organizing involves:
• Giving each member a specific task

•Establishing departments and divisions

•Delegating authority to the members
•Establishing channels of authority and communication
iii. Staffing: Staffing emphasizes the recruitment and selection of the human resources for an organization.
The steps involved in the staff function are:
•Determining the type of people to be hired
•Recruiting prospective employees and selecting the best ones from them
•Compensating the employees
•Training and developing the employees
•Setting performance standards and evaluating the employees’ performance
iv. Directing, as a function, aims at securing willing cooperation from the individuals and the groups to
achieve the predetermined goals. It includes the following activities:
•Getting work done through subordinates
•Ensuring effective two-way communication for the exchange of information with the subordinates
•Motivating subordinates to strive for better performance.
v. Controlling: Controlling is the process of checking the efficiency of the individuals and the groups in
fulfilling the plans and goals through follow-up measures. It essential for continuous improvement in the
managerial activities. The processes involved in controlling are
•Establishment of standard performance
•Measurement of actual performance
•Comparison of actual performance with the standard one to find the deviation
• Initiation of corrective measures if there is deviation.

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2. OPERATIVE FUNCTIONS

Operative
Functions of HRM

Procurement Integration
Development Compensation Maintenance
1. Job Analysis and 1. Industrial
Design 1. Career planning 1. Job evaluation & Motivation
relations
2. Human resource and development 2. Performance 1. Employee well-
evaluation being 2. Discipline
planning 2. Workers' training
2. Social security 3. Grievance
3. Recruitment 3. Executive 3. Wages
administration redressal
4. Selection development 3. Workers'
4. Incentives and Participation 4. Dispute
5. Placement 4. Organizational settlement
development benefits 4. Motivation
6. Orientation 5. Collective
5. Job rotation bargaining
7. Socialization
6. HR records,
research, and audit
7. HR information
system

Procurement: The first operative function of personnel management is procurement. It is concerned with
procuring and employing people who possess necessary skill, knowledge and aptitude. Under its purview
you have job analysis, manpower planning, recruitment, selection, placement, induction and internal
mobility.

Development: It is the process of improving, moulding, changing and developing the skills, knowledge,
creative ability, aptitude, attitude, values and commitment based on present and future requirements both
at the individual’s and organization’s level.

Compensation: It refers to the determination of the pay scale and other benefits for the employees. In
addition, HR managers should regularly manage the performance evaluation system of the organization,
and continuously design reward systems such as performance-linked incentive plans and bonus etc.

Maintenance and Motivation: It is a process which inspires people to give their best to the organization
through the use of intrinsic (achievement, recognition, responsibility) and extrinsic (job design, work
scheduling, appraisal-based incentives) rewards.

Integration: This tries to integrate the goals of an organization with employee aspirations through various
employee-oriented programs, like redressing grievances promptly, instituting proper disciplinary measures,
empowering people to decide things independently, encouraging a participative culture, offering
constructive help to trade unions etc.

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EVOLUTION OF HR

• Welfare officers were mainly there to ensure that the hygiene factors of the workers are met.
• Labour Managers and Personnel Managers were there when government intervened in order to protect
the basic needs of the workers. Personal managers were mainly administrative in nature and their job included
employee record keeping, adherence to policies, implementing functions like recruitment, training and wage
administration, etc., taking welfare-oriented measures, dealing with trade unions, etc.
• Gradually there was a transition from the administrative and passive Personnel Management approach to a
more dynamic Human Resource Management approach.
Personnel Management vs. Human Resource Management
➢ More efforts were put in the recruitment and skill enhancement of the workforce which have a direct
bearing on organizational profitability
➢ Motivation took the shape of challenging work environment, free holidays, creating an active social
community within the workforce, fringe benefits and the like, besides monetary incentives
➢ Training acquired a new “Training and Development” dimension with the focus on behavioural
training to change attitudes and develop basic skills rather than remaining limited to inculcating work-
related skills
➢ Wage and Salary Administration became more complex with the introduction of performance related
pay, employee stock options and the report-card based performance appraisal systems become more
proactive with new techniques such as Management by Objectives (MBO), 360-degree appraisals, etc.
➢ Emphasis on leadership development of employees instead of managing workforce
➢ Major focus in HRM is the development of skills

Strategic HRM
It is the alignment of HR processes with the business. The workforce considered to be resources till now
became assets. The thrust of human resource management now lies in trying to align individual goals and
objectives with corporate goals and objectives, and rather than enforce rules or dictate terms, act as a

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facilitator and promotes a participative approach. Now-a-days a direct linkage of compensation to the
profitability of the enterprise and the employee’s contribution towards such profitability is also being seen.
• Business Alignment.
• Necessarily connected to long term.
• It is collaborative (working with others like leaders, vendors, employees etc.) and proactive from an
operations point of view.
Some futuristic paths are Organizational development, Consulting and HRC. Some OD threads are Change
management, Strategic Organization system alignment, Capability Development, High Performance Culture
Development, Long Term Perspective.
HRC – Human Resource Capital can be infinite, as it can be used to produce more and more capital. Human
capital is the stock of competencies, knowledge, social and personality attributes, including creativity,
embodied in the ability to perform labour so as to produce economic value. While Human Resource refers to
an available supply which can be drawn on when needed. It is about a technology enabled system that can
collect, analyze, store and share HR data. It ensures that the cost is known and can be controlled.

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B. ORGANIZATIONAL BEHAVIOUR

What is Organizational Behaviour?

Organizational Behaviour is the study of both group and individual performance and activity within an
organization. This area of study examines human behaviour in a work environment and determines its impact
on job structure, performance, communication, motivation, leadership, etc.

Relevance of OB in HRM

Organizational Behaviour is a term used to define the concept of behavior for individuals who constitute the
human elements of an organization. This is related to human resources, which is a concept that is used to
describe the management of the employees in any organization. The effective use of human resources can be
used to shape the perceptions and Behaviour of the employees in an organization, resulting in a desired
outcome in their organizational Behaviour. This link between organizational Behaviour and human resource
management can be seen in the area of the workers' attitudes toward their jobs.

OB: Individual

1. Emotional Intelligence: The ability to identify and manage your own emotions and the emotions of
others. It is generally said to include three skills.

a) Emotional awareness: including the ability to identify your own emotions and those of others
b) The ability to harness emotions and apply them to tasks like thinking and problems solving
c) The ability to manage emotions, including the ability to regulate your own emotions, and the ability to
manage those of other people

2. Personality Type: A collection of personality traits which are thought to occur together consistently,
especially as determined by various personality tests:

Myers-Briggs Type Indicator

Myers-Briggs Type Indicator (MBTI) is a personality test designed to assist a person in identifying some
significant personal preferences. Katharine Cook Briggs and her daughter Isabel Briggs Myers developed the
Indicator during World War II, and its criteria follow from Carl Jung's theories in his work. The Indicator is
frequently used in the areas of pedagogy, group dynamics, employee training, leadership training, marriage
counseling, and personal development.
MBTI test has four scales with two possible choices for each scale:
• Extraverted (E) versus Introverted (I)
• Sensing (S) versus Intuitive (N)
• Thinking (T) versus Feeling (F)
• Judging (J) versus Perceiving (P)

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The Big Five Personality Model (“OCEAN” traits)
It is a personality test that lays the premise that five basic dimensions underlie all others and
encompass the significant variations in human personality. These dimensions are:

• refers to an individual's propensity to

Agreeableness defer to others

• a measure of one's reliability

Conscientiousness

• characterized by moodiness and

Neuroticism emotional instability

• captures one's comfort level with

Extraversion
relationships

Openness • addresses range of interests and

fascination with novelty

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 • Agreeableness refers to a person’s ability to get along with others. It causes some people to be gentle,
cooperative, forgiving, understanding, and good-natured in their dealings with others. But it may result
in others being irritable, short-tempered, uncooperative, and generally antagonistic toward other people.

• Conscientiousness refers to the number of goals on which a person focuses. Research has found that
more conscientious people tend to be higher performers than less conscientious people across a variety
of different jobs.

• Neuroticism refers to people who experience unpleasant emotions such as anger, anxiety, depression,
and feelings of vulnerability more often than do people who are relatively less neurotic. People who
are more neurotic are more excitable, insecure, reactive, and subject to extreme mood swings.

• Extraversion refers to a person’s comfort level with relationships. People who are called extroverts are
sociable, talkative, assertive, and open to establishing new relationships. Research suggests that
extroverts tend to be attracted to jobs based on personal relationships like sales and marketing positions
and tend to be higher overall job performers than introverts.

• Openness refers to a person’s rigidity of beliefs and range of interests. People with high levels of
openness are willing to listen to new ideas and to change their own ideas, beliefs, and attitudes as a
result of new information. They may also have broad interests and be curious, imaginative, and creative.
Openness may also indicate more receptivity to change rather than resistance to change.

3. PERCEPTION
A perception is a belief held by a person, or many people, based upon how they see the world around
them or the dynamic and complex way in which individuals select information (stimuli) from the
environment, interpret and translate it so that a meaning is assigned which will result in a pattern of
behaviour or thought.

Factors that influence perception:

1. Perceiver (the one who forms perception): Several characteristics of the perceiver affect social
perception. Perception like familiarity with target, attitude, mood, self-concept and individual’s
pattern of thinking is called as a cognitive structure.
2. Situation: The situation in which the perceiver meets the target also plays an important role.
3. Target: The characteristics of target that affects social perception are physical appearance, verbal
Communication, nonverbal cues and intentions.

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Barriers to Social Perception

Attribution Theory

Attribution theory deals with how the social perceiver uses information to arrive at causal explanations for
events. It examines what information is gathered and how it is combined to form a causal judgment. In an
organization, attribution theory is intended to assist an individual in understanding the causes of human
behavior.

1. You must observe the behavior, whether it is your own behavior or the behavior of someone else
2. You must determine whether the behavior being observed is intentional
3. You attribute the observed behavior

When we attribute the behavior, there are three things we need to consider:

1. Was the behavior caused by an external cause or an internal cause?

Internal cause: Internal causes are those factors that are attributed to the person being observed. Internal
causes are usually controllable. For example, a co-worker just received a promotion. You believe the reason
for her promotion was her hard work, dedication, and skills. You have thus attributed internal causes to her
promotion.
External cause: External causes are attributed to factors outside of the person being observed. External
causes are often not controllable, such as luck. For example, let's say your co-worker just received a
promotion. You believe she received her promotion because the owner of the company is her father. You
have attributed an external factor as the cause of her promotion.

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 2. Consistent or distinctive behavior?

When you observe a person behaving the same when he is faced with the same circumstances, the observed
behavior is consistent. Consistency is low if the person behaves differently in similar circumstances. If a
person is behaving differently in similar circumstances, then the reason for such behavior can be attributed
to external factors. Consistency is high if the person acts the same in similar circumstances and when this
happens, the reasons for this are mostly internal and specific to the person. When you are determining if a
person behaves the same way in different circumstances, you are determining whether the behavior is
distinctive. If a person behaves the same in different circumstances, then distinctiveness is low while if the
person behaves different in different circumstances, distinctiveness is high. When distinctiveness is
high, it can be attributed to external causes and when it’s low, it can be attributed to internal causes. For
example, if Sam gets into fights in different circumstances, then that would lead to an internal attribution
to his aggressive nature. Alternatively, information suggesting that John had never previously fought
would be likely to lead to an external attribution.

3. Consensus: Consensus is high if other people act in the same way as the person observed in the same
circumstances, while consensus is low if other people act differently than the person observed in the same
circumstances.

The following example will help you understand better how attribution theory can be used to analyze behaviors
in an organization:

Nadia’s performance is declining. Her peer’s performance hasn’t changed, it is occurring on several tasks
and has occurred for the past six months.

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This represents:
1. Low consensus
2. Low distinctiveness
3. High consistency
Therefore, the attribution that her supervisor is likely to make is internal.

4. Theories of Motivation That Describe and Govern Individual Organizational Behaviour

We can distinguish between content and process motivation theories. Content theories focus on WHAT, while
process theories focus on HOW human behaviour is motivated. Content theories are the earliest theories of
motivation. Within the work environment they have had the greatest impact on management practice and
policy, whilst within academic circles they are the least accepted. Content theories are also called needs
theories: they try to identify what our needs are and relate motivation to the fulfilling of these needs. The
content theories cannot entirely explain what motivate or demotivate us. Process theories are concerned with
“how” motivation occurs, and what kind of process can influence our motivation.

Motivation
Theories

Content Process
Theories Theories

Herzberg's McGregor' Skinner's

Maslow’s Alderfer's McClellan Vroom's Goal
Two s Theory X Reinforce
Hierarchy ERG d's Theory Expectanc Equity Setting
Factors and ment
of Needs Theory of Needs y Theory Theory Theory
Theory Theory Y Theory

No single motivation theory explains all aspects of people’s motives or lack of motives. Each theoretical
explanation can serve as the basis for the development of techniques for motivating.

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MASLOW’S HIERARCHY OF NEEDS

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.

Generally, a person at the beginning of their career will be very concerned with physiological needs such as
adequate wages and stable income and security needs such as benefits and a safe work environment.
Employees whose lowest level needs have not been met will make job decisions based on compensation,
safety, or stability concerns.
Once these basic needs are met, the employee will want his “belongingness” (or social) needs met. This means
effective interpersonal relations are necessary. Managers can create an environment where staff cooperation
is rewarded. With these needs satisfied, an employee will want his higher-level needs of esteem and self-
actualization met. Esteem needs are tied to an employee’s image of himself and his desire for the respect and
recognition of others. Cross-training, job enrichment, and special assignments are popular methods for making
work more rewarding. With self-actualization, the employee will be interested in growth and individual
development. At this highest level, managers focus on promoting an environment where an employee can
meet his own self-actualization needs.

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 THEORY OF X AND Y:
Two distinct sets of assumptions that managers, in general, have about their employees and which often turn
out to be self-fulfilling prophesies.
Theory-X assumptions are: (1) most people dislike work and will avoid it to the extent possible, therefore (2)
they must be continually coerced, controlled, and threatened with punishment to get the work done, and that
(3) they have little or no ambition, prefer to avoid responsibility, and choose security above everything else.

Theory-Y assumptions are: (1) physical and mental effort are natural and most people (depending on the work
environment) find work to be a source of satisfaction, (2) they generally, on their own motivation, exercise
self-control, self-direction, creativity, and ingenuity in pursuit of individual and collective (company) goals,
(3) they either seek responsibility or learn to accept it willingly, and that (4) their full potential is not tapped
in most organizations.
These assumptions serve as powerful behavioural models reflected in the way an organization is structured.
Management that believes in theory-X assumptions creates stick-and-carrot approach-based firms with
restrictive discipline and pervasive controls. Theory-Y believers create trust-based firms with empowered
employees.

HERZBERG'S MOTIVATION-HYGIENE THEORY

The Two-factor theory (also known as Herzberg's motivation-hygiene theory and Dual-Factor Theory) states
that there are certain factors in the workplace that cause job satisfaction, while a separate set of factors prevent
dissatisfaction. It was developed by Frederick Herzberg, a psychologist, who theorized that job satisfaction
and job dissatisfaction act independently of each other. Two-factor theory distinguishes between:
Motivators (e.g. challenging work, recognition, responsibility) that give positive satisfaction, arising from
intrinsic conditions of the job itself, such as recognition, achievement, or personal growth.

Hygiene factors (e.g. status, job security, salary, fringe benefits, work conditions) that do not give positive
satisfaction in the long run, though dissatisfaction results from their absence. These are extrinsic to the work
itself, and include aspects such as company policies, supervisory practices, or wages/salary.

Hygiene factors Motivating factors

• Also called • Called as Satisfiers

dissatisfiers • Achievement,
• Company policies, interesting work, etc.
supervision, etc.

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Following things can be kept in mind by the HR Managers while motivating the employees:
➢ Ensure hygiene factors are sufficient enough so employees don't become demotivated.
➢ Ensure work is rewarding and challenging to motivate employees to work harder.
➢ Continually develop employees to keep motivation high.
➢ Reward and Recognize high achieving employees.
➢ If possible rotate employee’s roles to keep Job interest high.
➢ Insure employees have training resources to continually develop themselves

MCCLELLAND’S THEORY OF NEEDS

Theory developed by David McClelland and his associates. It focuses on three needs:

➢ Need for Achievement: Those who have high need for achievement have a strong need to be successful
➢ Need for Power: Individuals who have a high need for affiliation want to be liked and accepted by others
➢ Need for Affiliation: Those with a high need for power want to influence others and control their
environment.

ALDERFER’S ERG THEORY

To bring Maslow’s need hierarchy theory of motivation in synchronization with empirical research, Clayton
Alderfer redefined it in his own terms. His rework is called as ERG theory of motivation. He recategorized
Maslow’s hierarchy of needs into three simpler and broader classes of needs:

Existence corresponds to Maslow’s physiological and safety needs, relatedness corresponds to social needs,
and growth refers to Maslow’s esteem and self-actualization.

ERG theory does not rank needs in any particular order and explicitly recognizes that more than one need
may operate at a given time.
For example: Someone who is frustrated by the growth opportunities in his job and progress toward career
goals may regress to relatedness need and start spending more time socializing with coworkers

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GOAL SETTING THEORY BY EDWIN LOCKE
Goal-setting theory refers to the effects of setting goals on subsequent performance. Locke found that
individuals who set specific, difficult goals performed better than those who set general, easy goals. He
proposed five basic principles of goal setting: clarity, challenge, commitment, feedback.

SKINNER’S REINFORCEMENT THEORY

It states that individual’s behaviour is a function of its consequences. It is based on “law of effect”, i.e.,
individual’s behaviour with positive consequences tends to be repeated, but individual’s behaviour with
negative consequences tends not to be repeated.
Positive Reinforcement: This implies giving a positive response when an individual shows positive and
required behaviour. For example - Immediately praising an employee for coming early for job. This will
increase probability of outstanding behaviour occurring again. Reward is a positive reinforce, but not
necessarily. If and only if the employees’ behaviour improves, reward can be said to be a positive
reinforcer. Positive reinforcement stimulates occurrence of a behaviour. It must be noted that more
spontaneous is the giving of reward, the greater reinforcement value it has.

Negative Reinforcement: This implies rewarding an employee by removing negative / undesirable

consequences. Both positive and negative reinforcement can be used for increasing desirable / required
behaviour.

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Punishment: It implies removing positive consequences so as to lower the probability of repeating
undesirable behaviour in future. In other words, punishment means applying undesirable consequence for
showing undesirable behaviour. For example, suspending an employee for breaking the organizational
rules. Punishment can be equalized by positive reinforcement from alternative source.

Extinction: It implies absence of reinforcements. In other words, extinction implies lowering the
probability of undesired behaviour by removing reward for that kind of behaviour. For example, if an
employee no longer receives praise and admiration for his good work, he may feel that his behaviour is
generating no fruitful consequence. Extinction may unintentionally lower desirable behaviour.

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VROOM’S EXPECTANCY THEORY

The expectancy theory places an emphasis on the process and on the content of motivation as well, and it
integrates needs, equity, and reinforcement theories. This theory aims to explain how people choose from
the available actions.

• The first question is whether the person believes that high levels of effort will lead to outcomes of
interest, such as performance or success. This perception is labeled expectancy
• The second question is the degree to which the person believes that performance is related to
subsequent outcomes, such as rewards. This perception is labeled instrumentality
• The anticipated satisfaction that will result from an outcome is labeled valence

How can you influence?

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ADAM’S EQUITY THEORY

The equity theory states that people are motivated if they are treated equitably and receive what they
consider fair for their effort and costs. According to this theory, people compare their contribution to work,
costs of their actions and the benefits that will result to the contribution and benefits of the reference person.
If people perceive that the ratio of their inputs-outputs to the ratio of referent other's input-output is
inequitable, then they will be motivated to reduce the inequity.

▪ Individuals are motivated by a sense of fairness in their interactions

▪ Equity is determined by comparing one’s input-outcome ratio with the input-outcome ratio of a
referent. When the two ratios are equal, equity exists
Responses to perceptions of equity and inequity:

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 OB: GROUP

Group dynamics is a system of Behaviours and psychological processes occurring within a social group
(intragroup dynamics), or between social groups (intergroup dynamics). The study of group dynamics can
be useful in understanding decision- making behaviour, tracking the spread of diseases in society, creating
effective therapy techniques, and following the emergence and popularity of new ideas and technologies.

Theories That Describe and Govern Group Organizational Behaviour

1. Five Stage Model: Initially, Tuckman identified four stages of group development, which included
the stages of forming, storming, norming and performing. A fifth stage was later added by Tuckman
about ten years later, which is called adjourning. It is believed that these stages are universal to all
teams despite the group's members, purpose, goal, culture, location, demographics and so on.

2. Groupthink: Groupthink, a term coined by social psychologist Irving Janis (1972), occurs when a
group makes faulty decisions because group pressures lead to a deterioration of “mental efficiency,
reality testing, and moral judgment”. Groups affected by groupthink ignore alternatives and tend to
take irrational actions that dehumanize other groups. A group is especially vulnerable to groupthink
when its members are similar in background, when the group is insulated from outside opinions, and
when there are no clear rules for decision making.

3. Asch Conformity test: The Asch Experiment, by Solomon Asch, was a famous experiment designed
to test how peer pressure to conform would influence the judgment and individuality of a test subject.
The experiment is related closely to the Stanford Prison and Milgram Experiments, in that it tries to
show how perfectly normal human beings can be pressured into unusual Behaviour by authority
figures, or by the consensus of opinion around them.

LEADERSHIP
The activity of leading a group of people or an organization or the ability to do this.
Leadership involves:
1. Establishing a clear vision
2. Sharing that vision with others so that they will follow willingly. Providing the information,
knowledge, and methods to realize that vision
3. Coordinating and balancing the conflicting interests of all members and stakeholder.

Theories of Leadership
1. Contingency theory says that good leadership depends on characteristics of the leader and the
situation

2. Leader-member exchange theory or LMX focus on relationships between individual supervisor-

subordinate pairs.

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 In-Group
• Members are similar to leader
• In the leader’s inner circle of communication
• Receives more time and attention from leader
• Gives greater responsibility and rewards
Out-Group
• Managed by formal rules and policies
• Receive less of the leader’s attention / fewer exchanges
• More likely to retaliate against the organization

3. Ohio State Leadership Studies identified the dimensions of consideration (showing concern and respect
for subordinates) and initiating structure (assigning tasks and setting performance goals).

4. Path-goal theory is a contingency theory linking appropriate leader style to organizational conditions,
and subordinate personality.

5. Transformational leadership theory concerns the Behaviours, leaders do that inspire followers to high
levels of motivation and performance. Related to charismatic leadership that is part of transformational.

6. Trait Theory: According to this theory, personal qualities and characteristics differentiate non-
leaders from leaders. In 1990s, these 7 traits were identified (ambition & energy, desire to lead, honesty
& integrity, self-confidence, high self-mentoring and job-relevant knowledge. Now Big five personality
framework is used to divide and submerge different traits into big 5.

7. Behavioural Theory of Leadership: In response to the early criticisms of the trait approach, theorists
began to research leadership as a set of Behaviours. They evaluated what successful leaders did,
developed taxonomy of actions, and identified broad patterns that indicated different leadership styles.

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C. EMPLOYEE LIFE CYCLE

The employee lifecycle model (ELC) is a method to visualize how the employee engages with the
organization they are a part of. ELM is defined as the tools, processes and management structures that
support the total experience of an employee at their company, from beginning to end. There are six
specific phases of the employee lifecycle:

1. Attract:

This phase marks the beginning of the employee’s lifecycle with the potential employees getting
interested in the job opening. There are several channels through which the employers can reach the
potential employees, out of which social media, online job portals and direct recruitment are some
examples.
There are several ways through which the employers attract the potential employees. They are:
a. Employee Value Proposition (EVP): This represents the organisation’s positioning of the various
people related practices, processes and experience in the eyes of the potential as well as present
employees. It is a set of associations and offerings provided by an organisation in return for the skills,
capabilities and experiences an employee brings to the organisation. It is important to have a well
defined EVP. An employer value proposition encompasses an organization’s mission, values, and
culture, and gives employees a powerful reason to work with that organisation. EVP can be
conceptualised via 3 stages:
• Collection of data and insights: Collecting data and inputs from the previously existing and current
employees, surveys, in-depth analysis and cultural diagnostics and arrive at potential EVP elements
using affinity analysis. Affinity analysis helps to cluster similar words into one common theme.
• Analysis through frames of reference: It is a set of criteria or stated values in relation to which
measurements or judgements can be made. Potential EVP elements can be shortlisted by using certain
frames of references.
• EVP statement articulation: Articulating the EVP statement after validation from the employees and
leadership, conducting independent audit to understand the gaps in employee touch-point experiences
and creating action plan focussing on the gaps found and addressing the issues. Post this process, EVP
can be conceptualised and presented before the leaders and launched & communicated to the
employees.

b. Employer Branding: Employer Branding is a company’s ability to differentiate and promote its
identity to a defined group of candidates that they are interested in hiring. A company can do this by
showcasing your organization’s unique cultural differentiators, and then working to amplify them so
you can position yourself as a top place to work.

c. Diversity & Inclusion: Diversity in the workplace means that an organization employs a diverse team
of people that’s reflective of the society in which it exists and operates. Diversity in the workplace
means that an organization employs a diverse team of people that’s reflective of the society in which
it exists and operates. Inclusion is the achievement of a work environment in which all individuals are
treated fairly and respectfully, have equal access to opportunities and resources, and can contribute
fully to the organization’s success. Hence, Diversity refers to the traits and characteristics that make

26
 people unique while inclusion refers to the behaviours and social norms that ensure people feel
welcome.

2. Hire

Hiring pertains to the recruitment and selection processes of a company. It is the process of reviewing
applications, selecting the right candidates to interview, testing candidates, choosing between
candidates to make the hiring decision and performing various pre-employment tests and checks.
Hiring includes Recruitment and Selection. Recruitment and Selection is an important operation in
HRM, designed to maximize employee strength in order to meet the employer's strategic goals and
objectives.

3. Onboard

This relates to what happens after a job offer is accepted including, how new hires are brought up-to-
speed on the company’s policies and procedures while learning the ropes of their positions. This
includes adding the employees to the contact lists, guiding them through payroll and benefits system,
organisation’s structure, systems, policies and procedures.
Many companies have a handbook ready for such knowledge transfer and training plan ready to impart
knowledge about the work, culture, team and environment. These are the components of a successful
onboarding program.
a. New Hire Welcome: The process of onboarding must begin as soon as the new employees are hired,
and the organisation reaches out to the new employees.
b. Company Introduction: This provides an overview of the company mission, the values of the
department, a presentation of key players, and the employee’s role in the big picture of things.
c. Policies and procedures: Sharing important points such as compensation plans, affirmative action, work
environment and complaint resolution processes to make the new employees aware. These things can
be accomplished through orientation or by providing a company handbook to new hires weeks before
they begin.
d. Cultural immersion: Making the employee welcome in his/her new workplace and acquaint the
employee with the values and characteristics important in the corporate culture
e. Mentors: Assigning mentors to the new employees bring the concepts of social interaction in a business
setting, making the employee feel comfortable in the new position while guiding him through his role
in the company and provide other relevant information.

4. Develop

This is the stage at which the employee and the human resources department work out her long-term
career goals with the company. Once an employee has moved out of the new hire phase and is
established as a skilled team member, managers work with the employee to identify a professional path
and to develop a plan to help the employee achieve their goals. Career development opportunities are
essential to keep an employee engaged with the company over time. This can include professional
growth and training to prepare the employee for positions of greater responsibility. This is where
Learning and Development and Performance Management come into picture.
Learning and Development: Learning and development is a systematic process to enhance an
27
 employee’s skills, knowledge, and competency, resulting in better performance in a work setting.
Specifically, learning is concerned with the acquisition of knowledge, skills, and attitudes.
Development is the broadening and deepening of knowledge in line with one’s development goals.
Performance Management: Performance management is about measuring, managing, and improving
the contribution of the individual to the organization. Conducting Performance Management entails
the organisation to two approaches:
1) Behavioural approach where employees are evaluated based on their behaviours and effort made.
2) Result oriented approach where employees are evaluated based on objective criteria and focus is not
on input but output, both in terms of quality and quantity.

5. Engage

This relates to employee engagement which is a measure of efforts put up by employee which is
measured by the organisation, usually annually. It can be done either via internal tool or external tools
like readymade surveys.
Creating In-House employee engagement tool:
• Employee engagement tool can be created by an expert panel with the help of EVP and HR strategy
• Researching the attributes which can defined employee engagement in an organisation in context with
the industry and the culture
• Verification of the attributes by the experts
• Clubbing the similar attributes within certain factors. This can be done by using factor analysis.

6. Off-board

This is the last stage in the lifecycle, when employees leave the company, voluntarily or involuntarily.
Employee offboarding describes the separation process when an employee leaves a company. The
offboarding process might involve a phased transfer to knowledge from the departing employee to a
new or existing employee; an exit interview; return of any company property; and various processes
from the company's human resources, information technology, or legal functions.
Exit Interview: An exit interview is a survey that is conducted with an employee when he or she leaves
the company. The information from each survey is used to provide feedback on why employees are
leaving, what they liked about their employment and what areas of the company need improvement.

*Further details are provided in the subsequent chapters

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 D. INDUSTRIAL RELATIONS AND LABOUR LAWS

The labour laws derive their origin, authority and strength from the provisions of the Constitution of India.
The relevance of the dignity of human labour and the need for protecting and safeguarding the interest of
labour as human beings has been enshrined in Chapter-III (Articles 16, 19, 23 & 24) and Chapter IV
(Articles 39, 41, 42, 43, 43A & 54) of the Constitution of India keeping in line with Fundamental Rights
and Directive Principles of State Policy.

Labour is a subject in the Concurrent List where both the Central & State Governments are competent to
enact legislation subject to certain matters being reserved for the Centre. As the area of industrial, labour
and general laws undergoes frequent changes, it becomes necessary for every student to constantly update
himself/herself.

International Labour Organisation (ILO) is a nodal agency coming under the ambit of the United Nations
(UN). Its primary objective is to deal with issues related to labour, namely, maintaining international labour
standards, ensuring social protection and providing work opportunities to all. India has been a permanent
member of ILO since 1922 and is one of its founding members.

The term ‘Industrial Relations’ comprises of two terms: ‘Industry’ and ‘Relations’. “Industry” refers to
“any productive activity in which an individual (or a group of individuals) is (are) engaged”. By “relations”
we mean “the relationships that exist within the industry between the employer and his workmen.”

The field of industrial relations includes the study of workers and their trade unions, management,
employers' associations, and the State institutions concerned with the regulation of employment.

Industrial relations involve attempts at arriving at solutions between the conflicting objectives and values;
between the profit motive and social gain; between discipline and freedom, between authority and industrial
democracy; between bargaining and co-operation; and between conflicting interests of the individual, the
group and the community.

Stakeholders in an IR System
Three main parties are directly involved in industrial relations are:

1. Employers: Employers possess certain rights vis-à-vis labours. They have the right to hire and
fire them. Management can also affect workers’ interests by exercising their right to relocate, close
or merge the factory or to introduce technological changes.

2. Employees: Workers seek to improve the terms and conditions of their employment. They exchange views
with management and voice their grievances. They also want to share decision making powers of
management. Workers generally unite to form unions against the

3. management and get support from these unions.

29
4. Government: The central and state government influences and regulates industrial relations through laws,
rules, agreements, awards of court and the like. It also includes third parties and labour and tribunal courts.
1 Industrial Relations
2 Industrial Safety &
Health
3 Child & Women Labour
4 Social Security
5 Wages
6 Labour Welfare
7 Employment
1 Labour Reforms
EXISTING LAWS
Catering to the Industrial disputes between the employers
and the workers/employees
Caters to the health and safety of the workers working in
the industrial establishments, docks and mines
Abolishes child labour, prohibits abuse of women labour
and Caters to the social and economic welfare of women
and child labour in the country
Caters to the social and economic security of the
workers/workmen/employees
Ensures wages and bonuses to the workers and employees
Ensures social security and welfare of the labour working
in the unorganised sector
Pertains to employment and training
NEW REFORM
New reform relating labour legislations bringing 44
legislations within 4 codes:
• Wages
• Industrial relations
• Social security and safety
• Health and working conditions
This move was taken to simplify the complicated Labour
laws and improve the Ease of Doing Business Index of the
country
30
INDUSTRIAL DISPUTES ACT, 1947

What is ID Act?
A piece of legislation calculated to ensure social justice to both employers and employees and advance
progress of industry by bringing about harmony and cordial relationship between the parties.
Objectives of the law
The main objective of the Industrial Disputes Act is to look into the investigation and settlement of industrial
disputes. However, it makes other provisions in respect of lay off, retrenchment, closure etc. The purpose is
to bring the conflicts between employer and employees to an amicable settlement. The Act provides
machinery for settlement of disputes if dispute cannot be solved through collective bargaining.
As per the ID Act the definitions are as following:

Industry - Any business, trade, undertaking, manufacture, or calling of employers and includes any calling,
service, employment, handicraft or industrial occupation or avocation of workmen
Triple Test to qualify as an Industry
1. Systematic Activity
2. Carried out by the cooperation of Employer & Employee
3. To satisfy Human wants

Workman – Any person employed for manual, unskilled, skilled, technical, operational, clerical or
supervisory work of hire or reward, includes any such person who has been dismissed, discharged or
retrenched in connection with, or as a consequence of, that dispute, or whose dismissal, discharge or
retrenchment has led to that dispute,
But does not include any such person:
1. Who is subject to the Air Force Act, 1950 or Army Act, 1950 or the Navy Act, 1957?
2. Who is employed in the police service
3. Who is employed mainly in the managerial or administrative capacity (involved in decision making,
supervision, command and control)
4. Who, being employed in supervisory capacity, draws wages exceeding Rs.10,000 per month.

Dominant Nature test: Dominant Nature Test states that predominant nature of work and not the designation
determines whether a person is a workman or not. The dominant purpose of employment must be taken into
account at first and not the additional duties, while determining status and character of the job.
Example: If the main work done is of clerical nature, the mere fact that some supervisory duties are also carried
out incidentally, will not convert his employment as a clerk into one in supervisory capacity.

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 What is an Industrial Dispute?
Industrial dispute means any dispute or difference between employers and employers, or between employers
and workmen, or between workmen and workmen, which is connected with the employment or non-
employment or the terms and conditions of employment or with the conditions of labour, of any person.
How are the disputes settled?
a. Works Committee:
• Mandatory for factories employing 100 or more workmen
• Bipartite Composition- consisting of equal number of workers’ representatives as well as the
employers’
• Promote measures for securing and preserving unity and good relations between the employers and
workmen
• Functions: Works committee deals with matters of day-to-day functioning at the shop floor level.

b. Conciliation Officer
Charged with the duty of mediating in and settlement of industrial disputes. May be appointed for a specified
area or for specified industries in a specified area or for one or more specified industries either permanently
or for a limited period. Function of a Conciliation Officer is to create congenial atmosphere within the
establishment where workers and employers can reconcile their disputes through the mediation.

c. Boards of Conciliation:
• Appropriate government may as occasion arises by notification in the Official Gazette, to constitute a
Board
• The Board shall consist of a Chairman and two or four other members, as the appropriate government
thinks fit and the chairman shall be an independent person
• The other members shall be appointed in equal numbers to represent the parties to the dispute
• Function: To investigate and bring settlement in the dispute. In case of settlement, the Board sends
the report with Memorandum of Settlement signed by the parties to the appropriate government. In
case of no settlement, a report along with reasons for not coming to a settlement and
recommendations is sent to the appropriate government.

d. Courts of Inquiry
• Appropriate Government through notification in the Official Gazette, to constitute a Court of Inquiry
• It looks into the matter connected with or relevant to an Industrial Dispute
• Consists of one or more independent persons
• In case the number of persons is more than one than the appropriate government appoints the Chairman
• Function: To inquire into matters referred to it and submit its report to the appropriate Government
ordinarily within a period of six months from the commencement of the inquiry.

e. Labour Courts
• Appropriate government to constitute one or more Labour Court
32
 • It deals with matters pertaining to:
▪ discharge and dismissal of workmen,
▪ application and interpretation of Standing Orders,
▪ propriety of orders passed under Standing Orders,
▪ legality of strikes & lock outs etc.

• Function: to (i) hold its proceedings expeditiously, and (ii) submit its award to the appropriate
Government soon after the conclusion of the proceedings.

f. Industrial Tribunals
• Appropriate government to constitute one or more Industrial Tribunals
• It deals with matters pertaining to:
▪ collective disputes such as wages, hours of work, leave, retrenchment, closure
▪ all matters which come under the jurisdiction of Labour Courts

g. National Tribunals
• The Central Government may set up a National Tribunal for adjudication of Industrial Disputes
• It deals with matters which are national importance or are of such nature that industrial
establishments in more than one State are likely to be interested in such disputes.
• Functions: When a matter has been referred to a National Tribunal, it must adjudicate the dispute
expeditiously and submit its award to the Central Government.

The adjudication of industrial disputes by Conciliation Board, Labour Court, Court of Inquiry, Industrial
Tribunal or National Tribunal can take place when a reference to this effect has been made by the
appropriate Government under Section 10.

Continuous Service

A workman shall be said to be in continuous service for a period, if he is, in uninterrupted service, including
service which may be interrupted on account of
• sickness or authorised leave
• or an accident or a strike which is not illegal,
• or a lock-out or a cessation of work which is not due to any fault on the part of the workman

Conditions

a) workman will be deemed to be in continuous service of one year if:

the workman, during a period of twelve calendar months preceding the date with reference to which
calculation is to be made, has actually worked for not less than –
(i) one hundred and ninety days in the case of a workman employed below ground in a mine; and
(ii) two hundred and forty days, in any other case.
33
b) for a period of six months if:
the workman, during a period of six calendar months preceding the date with reference to which
calculation is to be made, has actually worked for not less than –
(i) ninety-five days, in the case of a workman employed below ground in a mine; and
(ii) one hundred and twenty days, in any other case.

Strike
Strike means cessation of work by a body of persons employed in any industry, acting in combination, or a
concerted refusal, or a refusal under a common understanding, of any number of persons who are or have
been so employed to continue to work.

• Strike is a weapon of collective bargaining for the workers.

• Going on mass casual leave under a common understanding amounts to a strike.

• If on the sudden death of a fellow-worker, the workmen acting in concert refuse to resume work, it
amounts to a strike

• The justification of strikes has to be viewed from the stand point of fairness and reasonableness of
demands made by workmen and not merely from stand point of their exhausting all other legitimate
means open to them for getting their demands fulfilled.

When does a Strike become Illegal?

• During the pendency of conciliation proceedings before a Board and 7 days after the conclusion of
the proceedings
• During the pendency of proceedings before a Labour Court, tribunal or National Tribunal and 2 months
after the conclusion of the proceedings
• During the pendency of proceedings before an arbitrator and 2 months after the conclusion of the
proceedings
• When settlement or an award is in operation, in respect of any of the matters covered by the settlement
or award

Lay Off
When an employee is not given work due to some reasons beyond the powers of the employer. It means failure
/ refusal / inability of the employer to give employment due to following reasons:
• Shortage of raw material / power
• Accumulation of stocks
• Break down of machinery
34
 • Natural calamity
• Other connected reasons

Lock Out
Lock-out means temporary closing of a place of employment or the suspension of work, or the refusal by an
employer to continue to employ any number of persons employed by him. Workers go on strike, while lock-
out is to be declared by employer.
Differences between Lay-Off and Lock-out
• Lay-off generally occurs in continuing business, whereas lock-out is the closure of the business
temporarily or for the time being
• In case of a Lay-off the employer is liable to pay compensation, but the liability of employer to pay
compensation depend upon whether the lock-out was justified and legal or not. Whatever may be the
case the provisions applicable to payment of lay-off compensation cannot be applied to the cases of
lock-out. In a lock-out, there is no question of any wages or compensation being paid unless the lock-
out is held to be unjustified
• Lock-out, being an antithesis to strike, is declared by employer as a weapon of collective bargaining
and available to the employer to persuade, the employees to see his point of view and accept his
demands while lay-off is actuated by the exigencies of business.
• Lay-off is the result of trade reasons but lock-out is a weapon of collective bargaining.
• Lock-out is subject to certain restrictions and penalties but it is not so in case of lay-off.

Retrenchment
Termination of service of workman for any reason whatsoever is called retrenchment. Does not include:
• Termination as a punishment or
• Voluntary retirement or
• Retirement on reaching the age of superannuation or
• Termination as a result of non – renewal of contract or
• Termination on the ground of continued ill-health

Thus, the definition contemplates following requirements for retrenchment:

i. There should be termination of the service of the workman.
ii. The termination should be by the employer.
iii. The termination is not the result of punishment inflicted by way of disciplinary action.
iv. The definition excludes termination of service on the specified grounds or instances mentioned in it.

CONDITIONS PRECEDENT TO RETRENCHMENT - No workman employed in any industry that has

been in continuous service for not less than one year shall be retrenched by that employer until –

35
 a) The workman has been given one month's notice in writing indicating the reasons for retrenchment
and the period of notice has expired, or the workman has been paid wages in lieu of such notice.
b) the workman has been paid, at the time of retrenchment, compensation which shall be equivalent to
fifteen days' average pay for every completed year of continuous service or any part thereof in
excess of six months; and
c) notice in the prescribed manner is served on the appropriate Government authority

• Compensation shall be payable to workmen in case of transfer of an establishment or closure of an

establishment to protect the interests of the workmen
• The expression “retrenchment” is not to be understood in the narrow, natural and contextual meaning
but is to be understood in its wider literal meaning to mean termination of service of workman for any
reason whatsoever.
• The retrenchment should be bona fide and there should be no victimisation or unfair labour practice on
the part of the employer
• Termination on account of lack of confidence is stigmatic and does not amount to retrenchment
• Striking of the name of a worker from the rolls on the ground of absence for a specific period, provided
under Standing Orders amounts to retrenchment

Key Differences between layoff and retrenchment

1. Layoff refers to the provisional termination of the employee, at the instance of the employer.
Retrenchment means involuntary separation of an employee due to the replacement of labour by machines
or the close of the department.
2. The layoff is an action step, whereas retrenchment is a business strategy to reduce company’s expenses.
3. The layoff is of a temporary nature, i.e. it is for a definite period, in which the employees are recalled after
the expiry of the term. As opposed to retrenchment, is permanent in nature.
4. After the declaration of layoff, the company’s operations might get suspended or affected because of the
shortage of raw material, the breakdown of machinery, economic recession and so on. On the other hand,
the operations of the company continue unaffected even after retrenchment is declared.
5. As soon as the layoff period is over, the employees are re-appointed to their previous posts. Unlike
Retrenchment, in which the employees are not taken back by the company once they are terminated.

Closure
Permanent closing down of a place of employment or part thereof. (Closure can be of part of establishment
also).

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a. Closure – In case of less than 50 employees
• No notice is to be given
• The worker is paid 1-month salary or given one-month notice

b. Closure – Incase of 50 or more but less than 100 employees

• 60 days’ notice to be given to the appropriate government stating the reasons for closure
• Compensation – average pay for 3 months
• It does not apply to an undertaking set up for the constructions of buildings, bridges, roads, canals,
dams or for other construction work or project

c. Closure – Incase of 100 or more workmen

• Seek prior permission from appropriate government at least 90 days before the date of closure
and serve a copy of it to the workmen
• The Government may grant or refuse to grant permission for closure
• The employer waits for 60 days and if there is no communication from the appropriate government
permission is deemed to be granted
• Compensation – 15 days average pay for every completed year or continuous service or part thereof
in excess of six months

Settlement

“Settlement” means a settlement arrived at in the course of conciliation proceeding and includes a
written agreement between the employer and workmen arrived at otherwise than in the course of
conciliation proceeding.
Dismissal of an individual workman is to be deemed to be an industrial dispute

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2. THE FACTORIES ACT, 1948

1. Objective:
➢ To protect health, safety and welfare of the workmen
➢ To regulate hours of work, weekly offs and annual leave
➢ To regulate the employment of women and young persons

2. Features:
➢ Comprehensive law
➢ Regarded as one of the Benevolent, Noble and a Comprehensive Labour Legislation which is in force
in our country.
➢ Covers significant issues relating to the persons employed in factories.
➢ Secures -
▪ Safety
▪ Health
▪ Welfare
➢ Regulates - Working Hours
➢ Ensures - Annual leaves with wages
➢ Provides:
▪ Additional protection from hazardous processes
▪ Additional protection to women workmen
▪ Prohibition of employment of children

3. What is a Factory?
Any premises including precincts thereof
▪ whereon 10 or more persons are engaged, and a manufacturing process is carried on with the aid
of power or
▪ 20 or more persons are working, and a manufacturing process is carried on without the aid of power

Manufacturing Process
• making, altering, repairing, ornamenting, finishing, packing, oiling, washing, cleaning, breaking up,
demolishing, or otherwise treating or adapting any article or substance with a view to its use, sale,
transport, delivery or disposal,
• pumping oil, water, sewage or any other substance; or
• generating, transforming or transmitting power; or
• composing types for printing, printing by letter press, lithography, photogravure or other similar
process or book binding
• constructing, reconstructing, repairing, refitting, finishing or breaking up ships or vessels; preserving
or storing any article in cold storage.

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 Essential elements of a Factory
▪ There must be a premises
▪ There must be a manufacturing process which is being carried on in any part of such premises
▪ 10 workers with the aid of power and 20 workers without the aid of power

4. Who is an occupier?
The one who has ultimate control over the affairs of the factory

Proprietorship Proprietor
Partnership One of the partner
Company One of the Director
Central or State Persons so nominated
Government by the respective
owned governments

5. Who is a Manager?
A person responsible to the Occupier for the working of the Factory and for the purposes of the Act
Duties:
• Maintenance of Registers, furnishing OT slips, Leave cards etc.
• Furnishing of returns
• Submission of notice to work on Sunday
• Intimation about the reportable accidents, dangerous occurrences
6. Who is a Worker?
“Worker” means a person employed, directly or by or through any agency (including a contractor) with or
without the knowledge of the principal employer, whether for remuneration or not in any manufacturing
process or in any kind of work incidental to, or connected with, the manufacturing process
7. Terminology Used in The Act
• “Adult” means a person who has completed his eighteenth year of age
• “Adolescent” means a person who has completed his fifteenth year of age but has not completed his
eighteenth year
• “Child” means a person who has not completed his fifteenth year of age
• “Young person” means a person who is either a child or an adolescent
• “Day” means a period of twenty-four hours beginning at midnight
• "week" means a period of seven days beginning at midnight on Saturday night
• “Calendar year” means the period of twelve months beginning with the first day of January in any year

39
 • “Power” means electrical energy, or any other form of energy which is mechanically transmitted and
is not generated by human or animal agency.
8. Inspecting Staff
➢ State government may appoint Chief Inspector, Additional Chief Inspectors, Joint Chief Inspectors,
Deputy Chief Inspectors, and Inspectors.
➢ Prescribe their duties and qualifications
Powers:
▪ Enter factory premises for investigation
▪ Examine the premises
▪ Inquire into any accident or dangerous occurrence
▪ Require the production of any prescribed register or document
▪ Seize, or take copies of, any register, record or other document
▪ Take measurements and photographs and make such recordings
▪ Exercise such other powers as may be prescribed
9. Certifying Surgeons
State Government may appoint qualified medical practitioners to be certifying surgeons
Duties of surgeons
(a) The examination and certification of young persons under this Act.
(b) The examination of persons engaged in factories in such dangerous occupations or processes
(c) Supervising the factories where
I. cases of illness have occurred which are due to the nature of the manufacturing process or
II. due to manufacturing process there is a likelihood of injury to the health of workers or
III. Young persons are employed in any work which is likely to cause injury to their health.

10. Registration of Factory

• The occupier or the Manager has to apply to the Chief Inspector of Factories for getting the factory
registered
• The Chief Inspector of Factories, if he is satisfied, will register the factory and grant the license
• In case no license is issued by him within a period of 3 months the factory concerned shall be deemed
to be duly licensed

11. Duties of an Employer in a Factory

The duties are defined in 3 major areas:
i. Health
➢ To keep its premises in a clean state

40
 ➢ To dispose of wastes and effluents
➢ To maintain adequate ventilation and reasonable temperature
➢ To prevent accumulation of dust and fume
➢ To avoid over-crowding
➢ To provide sufficient lighting, drinking water, washrooms, and spittoons

ii. Safety
➢ To fence certain machinery
➢ To protect workers repairing machinery in motion
➢ To protect young person working on dangerous machines
➢ To maintain hoists and lifts in good condition
➢ To protect workers from injury to their eyes, dangerous dust, gas, fumes and vapors
➢ To protect workers from fire
➢ To employ a Safety Officer in a factory employing 1000 or more workers

iii. Welfare
➢ Facilities for washing
➢ Facilities for sitting of workers while they are on work
➢ Facilities for storing clothing not worn during working hours and the drying of wet clothing
➢ First-Aid box under the charge of a trained first aider (one for every 150 workers)
➢ Ambulance Room for factory employing more than 500 workers
➢ Canteen – more than 250 workers
➢ Crèche in factories employing more than 30 women workers
➢ If the number of workers is 500 or more, there should be a welfare officer to look after the welfare of the
workers

In a nutshell:
• Creche: >30 women workers
• Restrooms/shelters and lunchroom: >150 workers
• Cooled drinking water: >250 workers
• Canteen: >250 workers
• Ambulance room: >500 workers
• Welfare Officer: >500 workers
• Safety Officer: >1000 workers

12. Working hours for Adults

▪ A worker cannot be employed for more than 48 hours in a week
▪ Cannot be employed for more than 9 hours in a day
▪ Interval of rest at least ½ hour after 5 hours’ work
▪ Total period of work inclusive of rest interval must not be spread over more than 10.5 hours in a day
▪ Holiday for a whole day in every week
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 ▪ Overtime work at double the rate of his wages – works more than 9 hours in day or for more than 48
hours in a week (Refer to notes for maximum limit of OT)
▪ A woman worker cannot be employed in night shifts. Their work time will be 6 am -7 pm
13. Employments of young persons
▪ Employment of a child below the age of 14 years is totally prohibited
▪ Child more than 14 years of age and less than 15, can be employed to a maximum period of 4.5 hours
in a day
▪ Cannot be employed during nighttime
▪ Must have a fitness granted by a Certifying Surgeon
▪ Child more than 15 years of age and less than 18, can be employed as an adult if he has a certificate
of fitness for a full day’s work
14. Annual Leave with wages
▪ Condition: Entitled to leave with wages, (in the subsequent calendar year) if he has worked for 240
days or more in a calendar year
• Adult worker – One leave for 20 days actual working
• Child – One leave for 15 days actual working
▪ Accumulation of leave
• Adult - Up to 30 days
• Child – Up to 40 days

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3. OVERVIEW OF OTHER IR ACTS AND RECENT AMENDMENTS
THE MATERNITY BENEFITS ACT, 1961

Applicability
The Act extends to whole to India, every factory, mine or plantation (including those belonging to
Government) and to every shop or establishment wherein 10 or more persons are employed on any day
preceding 12 months.
Eligibility
1) Must work in the establishment for 80 days in 12 months before her date of delivery.
2) Women earning less than 15,000 may be offered ESI scheme by her employer and will not be eligible for
maternity benefit and but will receive the maternity benefit under ESI scheme.
Amendments

1. Increased Paid Maternity Leave: Increase in the duration of paid maternity leave available for women
employees from the existing 12 weeks to 26 weeks. Under the MB Amendment Act, this benefit could be
availed by women for a period extending up to 8 weeks before the expected delivery date and remaining 18
weeks can be availed post childbirth. For women who are expecting after having 2 children, the duration
of paid maternity leave shall be 12 weeks (i.e., 6 weeks pre and 6 weeks post expected date of delivery).
2. Maternity leave for adoptive and commissioning mothers: Extension of certain benefits to adoptive
mothers as well and provides that every woman who adopts a child shall be entitled to 12 weeks of
maternity leave, from the date of adoption.
3. Work from Home option: Introduction of an enabling provision relating to "work from home" for
women, which may be exercised after the expiry of the 26 weeks' leave period. Depending upon the nature
of work, women employees may be able to avail this benefit on terms that are mutually agreed with the
employer.
4. Crèche facility: Provision of crèche facility for every establishment employing 50 or more employees.
Women employees would be permitted to visit the crèche 4 times during the day.
5. Other benefits: Leave for miscarriage (paid; for 6 months from the date of her miscarriage), tubectomy
operations (leave with wages for 2 weeks), Leave for illness (for a maximum period of 1 month with
wages), and medical bonus of Rs. 250,

Justification for the Amendments

1. The amendments will help 1.8 million (approx.) women workforce in organized sector.
2. Maternal care to the Child during early childhood - crucial for growth and development of the child.
3. The 44th, 45th and 46th Indian Labour Conferences recommended enhancement of Maternity Benefits
to 24 weeks.
4. Ministry of Women & Child Development proposed to enhance Maternity Benefit to 8 months.
5. In Tripartite consultations, all stake holders, in general supported the amendment proposal.

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THE CONTRACT LABOUR (REGULATION & ABOLITION) ACT, 1970
Applicability
The Act applies to the Principal Employer of an Establishment and the Contractor wherein 20 or more
workmen are employed or were employed on any day of the preceding 12 months as Contract Labour.
Exception
This Act does not apply to the Establishments where work performed is of intermittent or seasonal nature. It
will not be intermittent in nature if work is performed for more than 120 days in the past 12 Months or more
than 60 days if seasonal in nature.

Amendment and Implications

1. Contract Labour Act has now been narrowed to establishments having 50 or more workmen (as opposed
to 20 or more workmen).
2. The Amendment Notification is more beneficial to the employer since the Contract Labour Act will not
be applicable to an establishment employing less than 50 workmen.
3. This Amendment Notification has come into force only in the State of Maharashtra.

THE CHILD LABOUR (PROHIBITION AND REGULATION) AMENDMENT ACT, 2016

1. The act has completely banned employment of children below 14 in all occupations and enterprises, except
those run by his or her own family, provided that education does not hampered. The 1986 act prohibited
the employment of children under 14 years in certain occupations like cigarette-making, mines, domestic
work, power looms, automobile workshops, carpet weaving etc.
2. Addition of a new category of persons called “adolescent”. It defines children between 14 to 18 years as
adolescents and bars their employment in any hazardous occupations.
3. The act makes child labour a cognizable offence. Employing children below 14 years will attract a jail
term between 6 months to two years (earlier 3 months to 1 year) or a penalty between twenty thousand to
fifty thousand rupees or both for the first time. Repeat offenders will attract imprisonment between 1 year
to 3 years (6 months to 2 years). In case, the offender is a parent, it provides a relaxed penal provision and
proposes a fine of Rs.10, 000 for repeat offence committed by parent.
4. The act has a provision of creating Rehabilitation Fund for the rehabilitation of children.
5. The number of hazardous occupations has been brought down from 83 to 3. The three occupations are
mining, inflammable substances, and hazardous processes under the Factories Act. It empowers Union
Government to add or omit any hazardous occupation from the list included in the act.
6. Empowers the government to make periodic inspection of places at which employment of children and
adolescents are prohibited.
7. Government may confer powers on a District Magistrate (DM) to ensure that the provisions of the law
are properly carried out and implemented.

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SEXUAL HARASSMENT AT WORKPLACE ACT,2013

Sexual harassment at workplace is a serious factor that renders women’s involvement in works unsafe and
affects right to work with dignity. It is unwelcome verbal, visual or physical conduct of a sexual nature
that is severe or pervasive and affects working conditions or creates a hostile work environment. Generally
sexual harassment is a sexually oriented conduct that may endanger the victim’s job, negatively affect the
victim’s job performance or undermine the victim’s personal dignity. It may manifest itself physically or
psychologically. Its milder and subtle forms may imply verbal innuendo, inappropriate affectionate
gestures or propositions for dates and sexual favors. However, it may also assume blatant and ugly forms
like leering, physical grabbing and sexual assault or sexual molestation. Before 1997, women experiencing
sexual harassment at workplace had to lodge a complaint under Section 354 of the Indian Penal Code that
deals with the criminal assault of women to outrage women’s modesty, and Section 509 that punishes an
individual or individuals for using a word, gesture or act intended to insult the modesty of a woman.
These sections left the interpretation of ‘outraging women’s modesty’ to the discretion of the police
officer. The entire scenario changed in 1997 with the introduction of Vishaka guidelines

Complaint mechanisms under the 2013 Act

• The Act contemplates the constitution of Internal Complaints Committee (“ICC”) (Sec. 4) at the
workplace and Local Complaints Committee (“LCC”) at district and block levels (Sec. 6).

• A District Officer (District Collector or Deputy Collector) shall be responsible for facilitating and
monitoring the activities under the Act. Every workplace employing 10 or more employees is
required to constitute an ICC. The ICC is required to consist of at least four members, and its
presiding officer is required to be a woman employed at a senior level.

• Provisions have been made in case no senior woman employee is available, to nominate a woman
presiding officer from another office, administrative unit, workplace, or organization. Further, one
half of the members must be women. LCCs are to be set up by the appropriate government which
shall receive complaints in respect of establishments that do not have ICCs on account of having
fewer than 10 employees and to receive complaints from domestic workers.

Scope for Conciliation and Settlement

Before initiating an inquiry, the ICC or LCC may, at the request of the aggrieved woman, take steps to
arrive at a settlement between the parties. However, no monetary settlement can be made as the basis of
such conciliation (Sec. 10(1)).In case the ICC or LCC is of the view that a malicious or false complaint
has been made, it may recommend that a penalty be levied on the complainant in accordance with the
applicable service rules (Section – 14). However, an inquiry must be also made. Mere inability to
substantiate a complaint will not attract action under this provision.

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The Duties of an Employer
The Act makes it the duty of every employer to:
i. provide a safe working environment at the workplace which shall include safety from all the
persons with whom a woman comes into contact at the workplace
ii. display at any conspicuous place in the workplace, the penal consequences of sexual harassment
and the order constituting the ICC
iii. organize workshops and awareness programmes
iv. provide necessary facilities to the ICC for dealing with complaints and conducting inquiries
v. assist in securing the attendance of the respondent and witnesses before the ICC
make available such information to the ICC or LCC, as it may require
vi. provide assistance to the woman if she so chooses to file a criminal complaint
vi. initiate criminal action against the perpetrator
vii. treat sexual harassment as a misconduct under the service rules and initiate action for such
misconduct
viii. Monitor the timely submission of reports by the ICC.

Penalties
Where the employer fails to comply with the provisions of the Act, he shall be liable to be punished with
a fine which may extend to Rs. 50,000. In case of a second or subsequent conviction under this Act, the
employer may be punished with twice the punishment prescribed or by cancellation of his license or
withdrawal of his registration

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E. HUMAN RESOURCE PLANNING

WHAT IS HRP?
HRP is understood as the process of, forecasting, an organization’s future demand for, and supply of, the
right type of people, in the right number. It is only after this, that the HRM department, can initiate the
recruitment and selection process. HRP facilitates the realization of the company's objectives, by providing
the right type, and the right number of personnel. HRP is variously called manpower planning, personnel
planning, or employment planning. It includes the estimation of how many qualified people are necessary,
to carry out the assigned activities, how many people will be available, and what, if anything, must be done
to ensure that personnel supply equals personnel demand, at the appropriate point in the future. Specifically,
human resources planning is the process by which an organization ensures that it has the right number
and kind of people, at the right place, at the right time, capable of effectively and efficiently completing
those tasks that will help the organization achieve-its overall objectives.

JOB ANALYSIS

Job analysis is the procedure through which you determine the duties of these positions and the
characteristics of the people to hire for them.
• Work activities
• Human Behaviour
• Machines, tools, equipment and work aids
• Performance standards
• Job context
• Human requirements

Uses of job analysis information

• Recruitment and selection
• Compensation
• Training
• Performance appraisal
• Discovering Unassigned Duties
• Legal Compliance

JOB DESCRIPTION
It is a written summery of tasks, duties and responsibilities a set of statement based on standards of practice
that comprises the employees’ contract with institution. It lists the expected behaviour of an employee.

Standard format of writing a job description:

1. Job identification
2. Job summary
3. Responsibilities and duties

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 4. Authority of incumbent
5. Standards of performance
6. Working conditions
7. Job specification

Principles of writing up effective job description:

• Arrange duties and responsibilities in logical orders.
• State duties and responsibilities clearly and concisely
• Be specific to show kind of work, complexity, skills required, and use action words such as analyze,
gather etc.

JOB DESIGN
Job design (also referred to as work design or task design) is the specification of contents, methods and
relationship of jobs in order to satisfy technological and organizational requirements as well as the social
and personal requirements of the job holder.

Core job dimensions

1. Skill variety: This refers to the range of skills and activities necessary to complete the job. The more a
person is required to use a wide variety of skills, the more satisfying the job is likely to be.
2. Task identity: This dimension measures the degree to which the job requires completion of a whole
and identifiable piece of work. Employees who are involved in an activity from start to finish are usually
more satisfied.
3. Task significance: This looks at the impact and influence of a job. Jobs are more satisfying if people
believe that they make a difference, and are adding real value to colleagues, the organization, or the larger
community.
4. Autonomy: This describes the amount of individual choice and discretion involved in a job. More
autonomy leads to more satisfaction. For instance, a job is likely to be more satisfying if people are involved
in making decisions, instead of simply being told what to do.
5. Feedback: This dimension measures the amount of information an employee receives about his or her
performance, and the extent to which he or she can see the impact of the work. The more people are told
about their performance, the more interested they will be in doing a good job. So, sharing production figures,
customer satisfaction scores etc. can increase the feedback levels.

Techniques of Job Design

Job rotation: is a job design method which is able to enhance motivation, develop workers' outlook,
increase productivity, improve the organization's performance on various levels by its multi-skilled workers,
and provides new opportunities to improve the attitude, thought, capabilities and skills of workers. Job
rotation is also process by which employees laterally mobilize and serve their tasks in

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different organizational levels: when an individual experiences different posts and responsibilities in an
organization, ability increases to evaluate his capabilities in the organization.

Job enlargement: Job Enlargement is defined as the process of assigning some extra duties to the job of an
employee. It is the process of increasing the activities of an employee by adding more tasks to the job of an
employee. The extra duties which are assigned to the job usually do not require special skills or new skills,
they can be performed with the same skills as before. Job Enlargement is the horizontal expansion of the
job, which means the job remains the same, but the duties and tasks of the job become more.

Job enrichment: Job Enrichment can be defined as the process which allows the employee to perform
higher responsibilities at a higher level. It provides the opportunity for achievement, recognition,
responsibility to the employee. Job Enrichment enables the employee to plan, control and evaluate their own
performance by themselves without the involvement of the management or higher authorities of the
organization. Job Enrichment is a motivational technique which gives importance to the need for challenging
and interesting work for the employee.

BASIS FOR COMPARISON JOB ENLARGEMENT JOB ENRICHMENT

MEANING A technique of job design in which A management tool used to

the task related to a single job are motivate employees, by adding
increased is known as job responsibilities in the job is
enlargement. known as Job Enrichment.
CONCEPT Quantitatively expanding the scope Qualitatively extending the range
of a job. of activities performed by a job.

OBJECTIVE To decrease the boredom in To make the job more

performing a redundant task challenging, interesting, and
creative.

OUTCOME May or may not be positive The result of job enrichment is

always positive

REQUIREMENT OF No Yes
ADDITIONAL SKILLS
EXPANSION Horizontal Vertical

SUPERVISION More Comparatively less

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Difference between Job enrichment and Job enlargement
The difference between job enrichment and job enlargement is quality and quantity. Job enrichment means
improvement, or an increase with the help of upgrading and development, whereas job enlargement means to
add more duties, and an increased workload. By job enrichment, an employee finds satisfaction in respect to
their position and personal growth potential, whereas job enlargement refers to having additional duties and
responsibilities in a current job description.

Difference between Job enrichment and Job rotation

Job enrichment and job rotation are two ways employees could be provided with opportunities to experience
new tasks and learn new skills.
Through job rotation, employees move from their typical day-to-day task to a whole new role, for a limited
time. Job enrichment gives employees a chance to stay in their current roles but experience a greater depth of
responsibility through enhanced tasks.

Example of Job enrichment:

Job enrichment can include letting employees approve checks for vendors for amounts higher than they have
in the past. If you typically ask your company's accounts payable specialist to let you see and sign off on
all outgoing checks over the amount of $1,000, you can change the amount to $2,000, giving the accounts
payable specialist a higher value of authority.

Example of Job enlargement:

If Mr. A is working as an executive with a company and is currently performing 3 activities on his job after
job enlargement or through job enlargement we add 4 more activities to the existing job so now Mr. A
performs 7 activities on the job. It must be noted that the new activities which have been added should belong
to the same hierarchy level in the organization.

Example of Job rotation:

Copywriters write the words that help sell the features and benefits of your products to customer, but they
rarely meet the customers they're trying to attract. Sales representatives, on the other hand, work directly with
clients and understand their buying behaviour. By rotating your copywriter into a sales position, you can give
the copywriter a chance to hear first-hand the language customers use when talking about your products or
services, objections they have and their core needs and wants. This experience can help copywriters get a
better idea of what to say in the marketing communications they write.

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F. RECRUITMENT AND SELECTION
Recruitment is a process to locate the sources from where the required human resource can be available and
attract them towards the organization.
Sources:
1. Advertisements
2. Educational institute
3. Placement agencies
4. Employment exchange
5. Labour contractors
6. M&A’s
7. Recruitment at factory gate
8. Job portals
Selection is the process of choosing the most suitable person out of all applicants.
Differences between Recruitment & Selection
Both recruitment and selection are the two phases of the employment process. The differences
between the two are:

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Types of Recruitment

A business can recruit in two different ways:

1. Internal recruitment: is characterized by promoting employees from within an organization to fill

upcoming positions. Many firms use such devices as job posting boards, email flashes, intranet posts
and fliers to advise existing employees of positions they may vie for. This recruitment may be in the
form of creating and shuffling temporary teams to fill certain tasks or may be permanent changes.
Internal recruitment may be primarily horizontal, or it may be for promotions in which the promoted
employee's former position may not be filled.

2. External recruitment: is one which a human resources department systematically searches the
employee pool outside its own employees to fill positions. Many firms use advertisements in
newspapers, job search websites, job fairs and referrals from current employees to fill positions. Some
companies utilize a temporary employee agency to fill positions that can be completed quickly and
with less company-specific skill required to complete the desired task. Other firms use headhunters or
hiring consultants to seek, screen and deliver employees for a fee.

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Selection Process
The selection process consists of various steps. At each stage facts may come to light, which may lead to
rejection of the applicant. Steps involved in the selection are:
1. Preliminary interview: Initial screening is done to weed out totally undesirable/unqualified
candidates at the outset. It is essentially a sorting process in which prospective candidates are
given necessary information about the nature of the job and the organization.

2. Application forms: Application form is a traditional and widely used device for collecting
Information from candidates. The application form should provide all the information relevant
to selection.

3. Selection test: Psychological are being increasingly used in employee selection. A test is sample
of some aspects of an individual’s attitude, Behaviour and performance. It also provides
systematic basis from comparing the Behaviour, performance and attitudes of two persons.

4. Employment interview: An interview is a conversation between two persons. In selection it

Involves a personal, observational and face-to-face appraisal of candidates for employment.

5. Medical examination: Applicants who have crossed the above stages are sent for a physical
examination either to the company’s physician or to a medical officer approved for the purpose.

6. Reference checks: The applicant is asked to mention in his application form the names and
addresses of two or three persons who know him well.

7. Final approval: - The executives of the concerned department finally approve the shortlisted
candidates. Employment is offered in the form of appointment letter mentioning the post, the rank, the
grade, and the date by which the candidate should join and other terms and conditions in brief.

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G. TALENT MANAGEMENT
Talent management is an organization's commitment to recruit, retain, and develop the most talented and
superior employees available in the job market. So, talent management is a useful term when it describes an
organization's commitment to hire, manage and retain talented employees. It comprises all of the work
processes and systems that are related to retaining and developing a superior workforce. Research shows that
organizations increasingly focus on talent management. Moving from reactive to proactive, companies are
working hard to harness talent.
Seven Keys to Effective Talent Management
1. Develop an integrated, proactive talent management strategy
2. Balance grassroots involvement in talent attraction and retention with management accountability.
3. Know the company’s business environment and plans—the competitive climate
4. Know what factors contribute to difficulties in attraction and retention: Base initiatives on the real concerns
of employees
5. Keep various retention factors in balance, especially the mix of compensation and non-financial motivators.
6. Track employee turnover
7. Market the company and its brand to current employees as vigorously as to the outside talent pool.

Competency

The combination of observable and measurable knowledge, skills, abilities and personal attributes that
contribute to enhanced employee performance and ultimately result in organizational success. To
understand competencies, it is important to define the various components of competencies.
• Knowledge is the cognizance of facts, truths and principles gained from formal training and/or experience.
• A skill is a developed proficiency or dexterity in mental operations or physical processes that is often
acquired through specialized training.
• Ability is the power or aptitude to perform physical or mental activities that are often affiliated with a
profession or trade such as computer programming, plumbing, calculus, and so forth.
• Individual attributes are properties, qualities or characteristics of individuals that reflect one's unique
personality. Individual attributes are viewed as genetically developed or acquired from one's accumulated
life experiences.

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Importance of choosing the right competencies:
• Plan how they will organize and develop their workforce.
• Determine which job classes best fit their business needs.
• Recruit and select the best employees.
• Manage and train employees effectively.
• Develop staff to fill future vacancies.

Competency Mapping
Competency Mapping is a process to identify key competencies for an organization and/or a job and
incorporating those competencies throughout the various processes (i.e. job evaluation, training, recruitment)
of the organization. Competency mapping identifies an individual's strengths and weaknesses. The aim is to
enable the person to better understand himself or herself and to point out where career development efforts
need to be directed.
The actual mapping of employees can be a self-done exercise or done by others like superiors. It can also be
done by using the 360-degree method where peers, first reports and customers also rate the employee.
Steps in competency mapping-
1. Skill identification from the job description.
2. Club all the skills across organization.
3. Frame skill categories – Categorization depends on your organizational industry, product, strength and
client base
4. Bucket skills into categories.
5. Prepare a skill dictionary
6. Understand the levels - of every skill. You can either choose a three - level or four – level dictionary.
Level 1 being lowest, Level 2 is Needs improvement, level 3 being Average and level 4 being good.
7. Mapping – mapping the desired level for each of the skill and current level of the skill for each
employee
8. Identify the Gap and translate it - Gap between Actual and Desired is the source of training need
identification.

High Potential vs. High Performance:

High performers stand out in any organization. They consistently exceed expectations, and are management’s
go-to people for difficult projects because they have a consistent track record of getting the job done. They are
great at their jobs and take pride in their accomplishments but may or may not have the potential (or desire) to
to succeed at a higher-level job or tackle advanced work.

High potentials are employees who have demonstrated initial aptitude for technical abilities and have future
potential to make a huge impact. They can do much more for the organization-with the caveat that high potentials
who are consistently low performers are rarely considered as strong candidates for management roles.

High potentials can be difficult to identify, for two reasons. First, high performance is so blindingly easy
to observe that it drowns out the less obvious attributes and behaviours that characterize high potentials–
like change management or learning capabilities.
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 Second, few organizations codify the attributes and competencies they value in their ideal employees–which
means managers don’t know what precisely to look for while assessing potential.

Nine-Box Grid

The Nine-Box Grid is an individual assessment grid that is used in evaluating an organization’s current
talent and identifying potential leaders:

Engaged, Disengaged and Actively Disengaged Employees

1. Engaged Employees: An engaged employee is defined as one who is fully absorbed by and enthusiastic
about their work and so takes positive action to further the organization's reputation and interests. Engaged
employees work with passion and feel a profound connection to their company. They drive innovation and
move the organization forward.

2. Disengaged Employees: These employees are essentially ‘checked out.’ They’re sleepwalking through
their workday, putting time — but not energy or passion — into their work.
3. Actively Disengaged Employees: Actively disengaged employees aren’t just unhappy at work; they’re
busy acting out their unhappiness. Every day, these workers undermine what their engaged coworkers
accomplish.

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 Difference Between Employee Turnover and Attrition
"Turnover" and "Attrition" are human resource terms that are often confused. Employee turnover and
attrition both occur when an employee leaves the company.
➢ Turnover, however, is from several different actions such as discharge, termination, resignation or
abandonment.
➢ Attrition occurs when an employee retires or when the employer eliminates the position.
The big difference between the two is that when turnover occurs, the company seeks someone to replace
the employee. But in the case of attrition, the employer leaves that vacancy unfilled or eliminates that
job role.
Example:
Alex and Binny are both nearing the end of their respective jobs with A&B Services, but under very different
circumstances. After 20 years with the company, Alex is retiring, and no one is coming in to replace him.
Binny, on the other hand, has been terminated from her role in the company's warehouse department and
someone will be needed to replace her.
Both employees are saying goodbye to their colleagues at A&B, but the company's human resources
department will categorize their departures quite differently. Why? While Alex is part of the company's
attrition, Binny is considered part of the company's employee turnover.

Good and Bad Attrition

1. Good Attrition: The term “healthy attrition” or “good attrition” means the importance of less productive
employees voluntarily leaving the organization. This means if the ones who have left fall in the category
of low performers, the attrition in considered being healthy.
2. Bad Attrition: When the departure of certain productive employees creates a setback (most often
temporary) in terms of work continuity and progress is commonly considered bad. The time and
investment lost in hiring and developing these people along with the cost of finding a replacement and
bringing him up to the productivity level, all come at a high price.

Knowledge, Skills & Abilities (KSA)

KSAs are knowledge, skills, and abilities that a person must possess in order to perform the duties of his or
her position. KSAs are listed on each position’s job description and serve as a guide for applicants, employees,
and departments to evaluate and assess a person’s likelihood for success in a job.

Knowledge: the subjects, topics, and items of information that an employee should know at the time he or
she is hired or moved into the job. Knowledge represents bodies of information that are applied directly to the
performance of work functions. E.g. Knowledge of records administration and maintenance techniques and
procedures.
Skills: technical or manual proficiencies which are usually learned or acquired through training. Skills should
be measurable and observable. E.g. Skill in data entry with minimal errors.
Abilities: the present demonstrable capacity to apply several knowledge and skills simultaneously in order to
complete a task or perform an observable Behaviour. Abilities may also relate to personal and social attributes
which tend to be innate or acquired without formal instructions. E.g. Ability to maintain records.
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H. LEARNING AND DEVELOPMENT
Training has implications for productivity, health and safety at work and personal development. All
organizations employing people need to train and develop their staff. Most organizations are cognizant of this
requirement and invest effort and other resources in training and development. Such investment can take the
form of employing specialist training and development staff and paying salaries to staff undergoing training
and development. Investment in training and development entails obtaining and maintaining space and
equipment. It also means that operational personnel, employed in the organization's main business functions,
such as production, maintenance, sales, marketing and management support, must also direct their attention
and effort from time to time towards supporting training development and delivery. This means they are
required to give less attention to activities that are obviously more productive in terms of the organization's main
business. However, investment in training and development is generally regarded as good management
practice to maintain appropriate expertise now and in the future.
Definition of Training
Training is a process in which the trainees get an opportunity to learn the key skills which are required to do
the job. Learning with earning is known as training. It helps the employees to understand the complete job
requirements.
Nowadays, many organizations organize a training program for the new recruits just after their selection and
induction, to let them know about the rules, policies and procedures for directing their behaviour and attitude
as per the organizational needs. Training also helps the employees to change the conduct towards their
superior, subordinates and colleagues. It helps to groom them for their prospective jobs.
Induction training, vestibule training, apprenticeship training, job training, promotional training, internship
training are some of the major types of training.
The merits of the training are given as under:
1. It results in higher productivity both quantitatively and qualitatively.
2. It develops a number of skills in the employees.
3. Improved performances.
4. The cooperative environment of the organization.
5. It builds confidence in the employees for doing a job.
6. Decreased employee turnover.
7. Lesser chances of accidents.
Definition of Development
The training for the top-level employees is considered as development, also known as management or
executive development. It is an on-going systematic procedure in which managerial staff learns to enhance
their conceptual, theoretical knowledge. It helps the individual to bring efficiency and effectiveness in their
work performances.

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Development is not only limited to a particular task, but it aims to improve their personality and attitude for
their all-round growth which will help them to face future challenges. It changes the mindset of the employees
and makes them more challenging or competing.
As the technology needs updating, the manpower of the organization also needs to be updated, so the
development is a must. Development is an educational process which is unending, as education has no visible
end. It involves training a person for higher assignments. It digs out the talents of the managerial staff and
helps in applying the new knowledge, which is a requirement of the organization.
Coaching, mentoring, counseling, job-rotation, role playing, case study, conference training, special projects
are some of the methods of development.
The performance of an organization is based on the quality of its employees, and so the greater the quality of
employees, the greater will be their performance. The primary purpose of development is that the second list
of managers or executives is prepared for future replacement.
Difference between Training & Development
The difference between training and management development tends to lie in timing. Typically, training is
the process by which people are taught critical skills. Participants gain knowledge to carry out their current
responsibilities. To goal is to improve performance in the short term. Development activities, on the other
hand, tend to prepare people for additional job roles for the long term. Training usually refers to organized
group events, such as workshops, classes or seminars that have a beginning and end date. Development tends
to refer to more personalized, individualized experiences, such as a certification process, job rotation period,
coaching or mentoring. Small-business owners can take advantage of the Small Business Administration
Training Network for both training and management development needs.

BASIS FOR COMPARISON TRAINING DEVELOPMENT

Development is an educational
process in which the personnel
Training is a learning process in
of the organization get the
which employees get an
chance to learn the in-depth
opportunity to develop skill,
application of theoretical
competency and knowledge as per
knowledge for their overall
the job requirement
Meaning growth.
Term Short Term Long Term
Focus on Present Future
Concentrated towards Job Career
Instructor Trainer Self
To improve the work To prepare employees for
Objective performances of the employees future challenges
Number of Individuals Many Only one
Conceptual and general
Aim Specific job related knowledge

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Pedagogical Analysis

A useful model that guides a learning and development strategy is created by van Gelder and colleagues. The
model starts with the organizational starting situation and prior knowledge based on which learning goals and
objectives are defined. This information is used as input for the subject matter, teaching methods, and learning
methods and activities. These lead to a certain result, which is monitored and evaluated. Based on this
evaluation, the goals and objectives are updated. It is divided into 4 phases

1. Analysis of training needs: This step is to identify the training needs. Organizations want employees to
acquire new knowledge, skills, and attitudes that are relevant for their (future) function and not the
existing skills they are hone. Identifying the learning goal requires analyzing where the organization
wants to go and what skills are missing to get there. This is done via three steps, namely organizational
analysis, competency analysis and personal analysis.

Organisational analysis
Short and long-term goals
of the organization are
analyzed
Personal analysis
Competency analysis
Performance evaluation
Competencies and skills
on current competencies
required to be successful
knowledge, performance,
in a job
and skill levels

2. Specification of learning objectives: The training needs are translated into learning objectives that help
in designing the training content and method. There are three elements to be kept in mind:

The ability to realize The conditions required A specific and

specific objectives for effective behavior measurable training goal

3. Designing training material and method: In this phase, the teaching material and learning method are
determined. This is where the choices about the training material, teaching method, and learning activities
are made. In addition to learning methods, techniques, pacing, setting, and many more factors are
determined.

4. Monitoring and evaluation: In this phase, the learning objectives are evaluated, and learning
effectiveness is assessed. Additionally, evaluations are collected and reviewed and improvements are
made for future learning interventions.

When the training is seen as effective, it should result in a change in behavior, indicating the success of
training and development.
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On the Job Training Methods
Managerial on the job training methods include job rotation, the coaching/ understudy approach and action
learning
Job rotation: A management training technique that involves moving a trainee from department to broaden
his or her experience and identify strong and weak points. Job rotation means moving management trainees
from department to department to broaden their understanding of all parts of the business and to test their
abilities. The trainee, often a recent college graduate, may spend several months in each department, fully
involved in its operations. The trainee thus learns the department’s business by actually doing it, while
discovering what jobs he or she prefers.
Coaching / Understudy Approach: Here the trainee works directly with a senior manager or with the person
he or she is to replace; the latter is responsible for the trainee’s coaching. Normally, the understudy relieves
the executive of certain responsibilities giving the trainee a chance to learn the job.
Action learning: A training technique by which management trainees are allowed to work full time analyzing
and solving problems in other departments. The basics include carefully selected teams of 5-25 members;
assigning teams real world business problems that extend beyond their usual area of expertise and structured
learning through coaching and mentoring. Employee’s managers usually chose the project and decide whether
to accept the team’s recommendations.

Off the Job Training Methods

Off-the-job techniques are also considered important to fill gaps as on-the-job techniques have their own
limitations.
The following are some of the important off-the-job techniques
1. The case studies
2. Incident method
3. Role playing
4. Business game
5. Grid training
6. Conferences

1. The Case Study: Cases are prepared on the basis of actual business situations that happened in various
organizations. The trainees are given cases for discussing and deciding upon the case. Then they are asked to
identify the apparent and hidden problems for which they have to suggest solutions.
The situation is generally described in a comprehensive manner and the trainee has to distinguish the
significant facts from the insignificant, analyze the facts, identify the different alternative solutions, select and

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suggest the best. This whole exercise improves the participant’s decision-making skills by sharpening their
analytical and judging abilities.

2. Incident Method: It aims to develop the trainee in the areas of intellectual ability, practical judgment and
social awareness. Under this method each employee is developed in a group process.
Incidents are prepared on the basis of actual situation which happened in different organizations. Each
employee in the training group is asked to study the incident and to make short-term decisions in the role of
a person who has to cope with the incident in the actual situation. Later, the group studies and discusses the
incident and takes decisions relating to incident, based on the group interaction and decisions taken by each
member.

3. Role Playing: A problem situation is simulated by asking the participants to assume the role of particular
person in the situation. The participant interacts with other participants assuming different roles. Mental set
up of the role is described but no dialogue is provided. Role playing gives the participants vicarious
experiences which are of much use to understand people better. This method teaches human relations skills
through actual practice. The exemplary role-playing situations are a grievance discussion, employment
interview, a sales presentation etc.

4. Business Games: Under this method, the trainees are divided into groups or different teams. Each team has
to discuss and arrive at decision concerning such subjects as production, pricing, research expenditure,
advertising etc., assuming it to be the management of a simulated firm. The other teams assume themselves
as competitors and react to the decision. This immediate feedback helps to know the relative performance of
each team. The team’s cooperative decision promotes greater interaction among participants and gives them
the experience in cooperative group processes.

5. Managerial Grid: It is a six-phase program lasting from three to five years. It starts with upgrading
managerial skills, continues to group improvement, improves inter group relations, goes into corporate
planning, develops implementation method and ends with an evaluation phase. The grid represents several
possible leadership styles. Each style represents a different combination of two basic orientations concern for
people and concern for production.

6. Conferences: A conference is a meeting of several people to discuss the subject of common interest. But
contribution from members can be expected as each one builds upon ideas of other participants. This method
is best suited when a problem has to be analyzed and examined from different viewpoints. It helps the members
develop their ability to modify their attitudes. Participants enjoy their method of learning as they get an
opportunity to express their view. The success of the conference depends on the conference leader. In order
to make the conference a success, the conference leader must be able to see that the discussion is

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thorough and concentrate on the central problem by encouraging all the participants to develop alternatives
and present their viewpoints and by preventing domination by a few participants.
Differences between Mentoring and Coaching
Mentoring
Ongoing relationship that can last for a
long period
Can be more informal and meetings can
take place as and when the mentee needs
some advice, guidance or support
More long-term and takes a broader view
of the person
Mentor is usually more experienced and
qualified than the ‘mentee’. Often a senior
person in the organization who can pass
on knowledge, experience and open doors
to otherwise out-of-reach opportunities
Focus is on career and personal
development
Agenda is set by the mentee, with the
mentor providing support and guidance to
prepare them for future roles
Mentoring resolves more around
developing the mentee professional
LEARNING THEORIES
Coaching
Relationship generally has a set duration of
time
Generally, more structured in nature and
meetings are scheduled on a regular basis
Short-term (sometimes time-bounded) and
focused on specific development
areas/issues
Coaching is generally not performed on the
basis that the coach needs to have direct
experience of their client’s formal
occupational role, unless the coaching is
specific and skills-focused
Focus is generally on development/issues
at work
The agenda is focused on achieving
specific, immediate goals
Coaching revolves more around specific
development areas/issues
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Behaviorism
Behaviorism is a worldview that assumes a learner is essentially passive, responding to environmental stimuli.
The learner starts off as a clean slate (i.e. tabula rasa) and behavior is shaped through positive reinforcement
or negative reinforcement. Both positive reinforcement and negative reinforcement increase the probability
that the antecedent behavior will happen again. In contrast, punishment (both positive and negative) decreases
the likelihood that the antecedent behavior will happen again. Positive indicates the application of a stimulus;
Negative indicates the withholding of a stimulus. Learning is therefore defined as a change in behavior in the
learner.

Cognitivism

Cognitivism focuses on the inner mental activities – opening the “black box" of the human mind is valuable
and necessary for understanding how people learn. Mental processes such as thinking, memory, knowing, and
problem-solving need to be explored.
Reference Reading: Attribution Theory (https://study.com/academy/lesson/bernard-weiner-attribution-
theory-lesson-quiz.html )

Constructivism
The constructivism learning theory states that knowledge is constructed based on personal experiences and
hypotheses of the environment. Learners continuously test these hypotheses through social negotiation. Each
person has a different interpretation and construction of knowledge process. The learner is not a blank slate
(tabula rasa) but brings past experiences and cultural factors to a situation

Instructional Design Process

The instructional design process consists of determining the needs of the learners, defining the end goals and
objectives of instruction, designing and planning assessment tasks, and designing teaching and learning
activities to ensure the quality of instruction.

Instructional Design Model-

An instructional design model is used to define the activities that will guide the development of eLearning
projects. It allows you to communicate the purpose and reason behind a strategy.

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 Two of the widely used instructional designed models are explained below:

ADDIE Model:

Summary: The ADDIE model is a systematic instructional design model consisting of five phases: (1)
Analysis, (2) Design, (3) Development, (4) Implementation, and (5) Evaluation.

Originator: Unknown. Refined by Dick and Carey and others

The generic term for the five-phase instructional design model consisting of Analysis, Design,
Development, Implementation, and Evaluation. Each step has an outcome that feeds into the next step in
the sequence. There are probably over 100+ different variations of the generic ADDIE model.

The five phases of ADDIE are as follows:

i. Analysis: During analysis, the designer identifies the learning problem, the goals and objectives, the
audience’s needs, existing knowledge, and any other relevant characteristics. Analysis also considers the
learning environment, any constraints, the delivery options, and the timeline for the project.
ii. Design: A systematic process of specifying learning objectives. Detailed storyboards and prototypes are
often made, and the look and feel, graphic design, user-interface and content is determined here.
iii. Development: The actual creation (production) of the content and learning materials based on the Design
phase.
iv. Implementation: During implementation, the plan is put into action and a procedure for training the learner
and teacher is developed. Materials are delivered or distributed to the student group. After delivery, the
effectiveness of the training materials is evaluated.
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v. Evaluation: This phase consists of (1) formative and (2) summative evaluation. Formative evaluation is
present in each stage of the ADDIE process. Summative evaluation consists of tests designed for criterion-
related referenced items and providing opportunities for feedback from the users. Revisions are made, as
necessary.

Rapid prototyping (continual feedback) has sometimes been cited as a way to improve the generic
ADDIE model.

Bloom’s Taxonomy

Bloom’s Taxonomy, proposed by Benjamin Bloom, is a theoretical framework for learning and identifies
three domains of learning:

1. Cognitive: Skills in the Cognitive domain revolve around knowledge, comprehension and critical thinking
on a particular subject. In traditional forms of education, classrooms or online learning, the emphasis is
more on the skills in this domain, particularly the lower-order objectives.

2. Affective: Skills in the Affective domain describe the way people react emotionally and involve learning
that happens at the behavioural level. Affective objectives aim to increase the awareness and improve
attitudes, emotions and feelings.

3. Psychomotor: The Psychomotor domain deals with skill-based learning. Skills involve the capability to
bodily manipulate tools or instruments similar to a hand or a hammer. Psychomotor objectives usually
focus on change or development in behaviour and skills.
Levels or constituents of the Cognitive domain of learning

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Future Trends for Learning & Development

1. Personalization
Personalized learning paths have been among the top Learning and Development trends for years. This is due
to the fact that "one-size-fits-all" online training courses seem to always fall short of expectations. Corporate
learners need to be able to focus on their areas for improvement, instead of keeping pace with their peers.
Learning and Development personalization may come in the form of non-linear eLearning course maps,
individualized online training contracts, or self-directed online training activities. The key is to gauge the gaps
with pre-assessments, and then give corporate learners the online training resources they require to bridge
them.

2. Bite-Sized Support Resources

Corporate learners usually don't have time to sit through a half-hour online training course. This is why bite-
sized support resources are essential in corporate L&D. Everyone gets the information they need to solve the
problem and build their skills on the spot. Thus, organizations improve their online training ROI and
employees are more satisfied in the workplace.

3. Robust Reports and Analytics

LMS metrics, website stats, and other sources of Big Data give organizations the ability to continually
improve their L&D strategy. These systems enable them to track corporate learners' performance in order to
identify patterns and trends, as well as highlight individual strengths and weaknesses. Therefore, they can
intervene when necessary and offer the ideal supplemental online training resources.

4. Self-Paced Online Training

Corporate learners must be able to go at their own pace and focus on individual areas for improvement. Self-
paced online training is one of the top Learning and Development trends because different employees require
different online training resources. They need to train when it's most convenient for them so that they can
retain and recall the information. This involves setting their own schedule, developing targeted goals, and
seeking out online training resources autonomously.

5. Gamification
Badges, points, and leaderboards incentivize the online training experience. Corporate learners who may lack
the passion and drive to actively participate can use these tools as a springboard; at least, until their intrinsic
motivation kicks in. Gamification also serves as a valuable feedback tool. For example, a corporate learner is
unable to earn a badge or advance to the next level. This indicates that they need to improve in this area in
order to achieve the desired outcome. There is one caveat to keep in mind, however. The rewards must justify
the risk. Likewise, you have to find the incentives that spark motivation. For instance, leaderboards are
beneficial for some, but others might prefer less competitive game mechanics.

6. Responsive Design
Multiplatform-friendly online training content gives corporate learners the power to access online training
resources on any device, from laptops to the latest smartphones and tablets. As such, responsive
design eLearning authoring tools and Learning Management Systems are "all the rage" in Learning and
Development. These platforms allow eLearning professionals to create a master version of the online training
course with breakpoints. The system adjusts the layout based on the device. This gives every corporate learner
the opportunity to navigate the online training course with ease and actively participate in the online training
experience.
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7. Virtual and Augmented Reality
Virtual Reality and Augmented Reality online training content is becoming more common every year. This is
primarily due to the fact that it has so many applications in Learning and Development, from immersive task-
based online training simulations to more interactive serious games. Virtual and Augmented Reality have the
power to transform online training experiences by putting corporate learners into the middle of the action.
Thus, they are able to gain more real-world experience in a risk-free environment.

8. Online Mentorship Programs

Corporate learners have experience, knowledge, and skills to share. Online mentorship programs facilitate this
exchange and give corporate learners more control over the online training process.

9. Social Learning Experiences

A majority of corporate learners already use social media, blogs, and online discussions. Therefore, they are a
great addition to Learning and Development initiatives. Corporate learners can use these social learning tools
to interact with peers and gain valuable feedback. They also have the ability to share online training resources
and create their own online training content, which improves comprehension. For example, create weekly blog
posts to recap the subject matter and explore their own perspective, or participate in social media groups in
order to discuss important topics and share tips.

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I. PERFORMANCE MANAGEMENT
Performance Management is the mechanism that ensures that the employee achieves the objectives set by the
organization and the organization thereby achieves the objectives that it has set itself in its strategic plan.
Setting and clearly communicating performance standards and expectations, observing and providing
feedback, and conducting appraisals enables you to achieve the best results through managing employee
performance.
1. Performance Management Cycle
Steps in a typical performance management cycle are Plan, Manage, Review, Reward and Renew, depending
on the type of organization, the management cycle may take place over a year's period or month by month.
Stage 1 - Plan: Planning involves getting together with an employee and evaluating expectations for a set
period of time. Evaluates an employee’s current role and performance, this will help him/her gain an initial
idea about areas of improvement and realistic targets.
Stage 2 – Manage: Implementing the plan and managing performance is stage 2 of the cycle. This can be
providing support to an employee at all times and ensuring that the appropriate systems and tools are available
to maximize performance expectations.
Stage 3 – Review: Making sure that the performance structure set out in stage one is being adhered to,
this may be particularly useful if there are any barriers to performance that could have a direct effect on other
areas of the organization. Speaking to an employee mid-way through a performance cycle is a good chance to
tweak their objectives depending on external factors.
Stage 4 – Reward: If all of the objectives have been met, stage 4 of the performance management cycle is to
reward employees. Reasons and types of rewards will be discussed during stage one when objectives are
outlined.
Stage 5 - Renew: The final stage of the performance management cycle is renew. This can involve analyzing
the previous objectives and looking at ways to improve on them and how to plan for the next cycle. Methods
of rewards can vary from an annual bonus to share scheme options.

2. 360 Degree Feedback

360-degree feedback is a method and a tool that provides each employee the opportunity to receive
performance feedback from his or her supervisor and four to eight peers, reporting staff members, co-workers
and customers. Most 360-degree feedback tools are also responded to by each individual in a self-assessment.
360-degree feedback allows each individual to understand how his effectiveness as an employee, co- worker,
or staff member is viewed by others. The most effective 360-degree feedback processes provide feedback that
is based on the behavior that other employees can see.

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Advantages Of 360-degree Feedback
i. Improved Feedback from more sources: Provides a well-rounded feedback from peers, reporting
staff, co-workers, and supervisors. This can be a definite improvement over feedback from a single
individual. 360-degree feedback can also save manager’s time in that they can spend less energy
providing feedback as more people participate in the process. Co-worker perception is important, and
the process helps people understand how other employees view their work.

ii. Team Development: Helps team members learn to work more effectively together. (Teams know
more about how team members are performing than their supervisor.) Multi-rater feedback makes
team members more accountable to each other as they share the knowledge that they will provide input
on each member’s performance. A well-planned process can improve communication and team
development.

iii. Personal And organizational Performance Development: 360-degree feedback is one of the best
methods for understanding personal and organizational developmental needs.

iv. Responsibility of Career Development: For many reasons, organizations are no longer responsible
for developing the careers of their employees, if they ever were. Multi-rater feedback can provide
excellent information to an individual about what she needs to do to enhance her career. Additionally,
many employees feel 360-degree feedback is more accurate, more reflective of their performance, and
more validating than prior feedback from the supervisor alone. This makes the information more useful
for both career and personal development.

v. Reduced Discrimination Risk: When feedback comes from a number of individuals in various job
functions, discrimination because of race, age, gender, and so on, is reduced. The "horns and halo"
effect, in which a supervisor rates performance based on her most recent interactions with the
employee, is also minimized.

vi. Training Needs Assessment: 360-degree feedback provides comprehensive information about
organization training needs and thus allows planning for classes, cross-functional responsibilities, and
cross-training.

Disadvantages Of 360-degree Feedback

i. Exceptional Expectations from the Process: 360-degree feedback is not the same as a performance
management system. It is merely a part of the feedback and development that a performance
management system offers within an organization. Additionally, proponents may lead participants to
expect too much from this feedback system in their efforts to obtain organizational support for
implementation. Make sure the 360 feedback is integrated into a complete performance management
system.

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 ii. Design Process Downfalls: Often, a 360-degree feedback process arrives as a recommendation from
the HR department or is shepherded in by an executive who learned about the process at a seminar or in
a book. A cross-section of the people who will have to live with and utilize the process should explore
and develop the process for your organization.

3. Methods of Performance Management and Appraisal

i. Assessment center method: This method was used for the first time in 1930 by the German army and
then in 1960’s by the British army. This method tests a candidate in different social situations using a
number of assessor and procedures. The performance of an employee an also his potential for a new
job is evaluated in this method by assessing his performance on job related simulations. Characteristics
that the concerned managers feel are important for the success of a particular job are included in these
simulations. Techniques like business games role playing and in basket exercises are used in this
method. The employees are evaluated individually as well as collectively on job related
characteristics. Personal interview and projective tests help in assessing the motivation, career
orientation and dependence on others of an employee. To measure the intellectual capacity written tests
are used. The evaluators in this method consist of experienced manager working at different levels who
prepare a summary report for the management as well as for the employees. This technique usually
measures the planning ability interpersonal skills and organizational skills of an employee.

ii. Human Resource Accounting Method: Human resources are a valuable asset for any organization,
and it can be valued in monetary terms. This method evaluates the performance of an employee in
terms of costs and contributions. HR costs include expenses incurred on HR planning recruitment
selection induction and training. Human Resource Accounting is the process of Assigning, budgeting,
and reporting the cost of human resources incurred in an organization, including wages and salaries
and training expenses. Human resources are valuable assets for every organization. Human resource
accounting method tries to find the relative worth of these assets in the terms of money. In this method
the Performance appraisal of the employees is judged in terms of cost and contribution of the
employees. The cost of employees includes all the expenses incurred on them like their compensation,
recruitment and selection costs, induction and training costs etc. whereas their contribution includes
the total value added (in monetary terms). The difference between the cost and the contribution will
be the performance of the employees. Ideally, the contribution of the employees should be greater
than the cost incurred on them.

ii. Behaviorally anchored rating scale (BARS): Behaviorally Anchored Rating Scales (BARS) is a
relatively new technique which combines the graphic rating scale and critical incidents method. It
consists of predetermined critical areas of job performance or sets of behavioral statements Describing
important job performance qualities as good or bad (for e.g. the qualities like inter-personal
relationships, adaptability and reliability, job knowledge etc.). These statements are developed from
critical incidents. In this method, an employee’s actual job behaviour is judged against the desired
behaviour by recording and comparing the behavior with BARS. Developing and practicing BARS
requires expert knowledge. A behaviorally anchored rating scale is an employee appraisal system

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 where raters distinguish between successful and unsuccessful job performance by collecting and listing
critical job factors. These critical behaviors are categorized and appointed a numerical value which is
used as the basis for rating performance.

iv. Appraisal through management by objectives (MBO): MBO as a mutual goal setting exercise is
most appropriate for technical, professional, supervisory, and executive personnel. In these positions,
there is generally enough latitude and room for discretion to make it possible for the person to
participate in setting his work goals, tackle new projects, and discover new ways to solve problems.
This method is generally not applied for lower categories of workers because their jobs are usually too
restricted in scope. There is little discretionary opportunity for them to shape their jobs. MBO may be
viewed as a system of management rather than an appraisal method. A successful installation of MBO
requires written mission statements that are prepared at the highest levels of top management. Mission
statements provide the coherence in which top down and bottom-up goal setting appear sensible and
compatible. MBO can be applied successfully to an organization that has sufficient autonomy,
personnel, budget allocation, and policy integrity. Managers are expected to perform so that goals are
attained by the organization. Too often MBO is installed top-down in a dictatorial manner with a little
or no accompanying training. If properly implemented, it serves as a powerful and useful tool for the
success of managerial performance.

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 MBO is a tool that is inextricably connected with team building so that the work commitment of team
members can be increased and their desire to excel in performance can be inspired. It is important to
have effective teamwork among a group of managers or a group of subordinates. The group of
employees or subordinates must be looked upon as a team that needs to be brought together. Goals
should be set by manager-subordinate pairs, and also by teams. The basic superior subordinate
relationship in an organization is in no way undermined in this concept of team goal setting. Lines of
responsibility, authority, and accountability remain clear.

Typical MBO Cycle

v. Psychological Appraisals:
These appraisals are more directed to assess employee’s potential for future performance rather than
the past one. It is done in the form of in-depth interviews, psychological tests, and discussion with
supervisors and review of other evaluations. It is more focused on employees emotional, intellectual,
and motivational and other personal characteristics affecting his performance. This approach is slow
and costly and may be useful for bright young members who may have considerable potential.
However, quality of these appraisals largely depends upon the skills of psychologists who perform the
evaluation.

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HRP Techniques

• Regression analysis

Regression analysis is a form of predictive modeling technique which investigates the relationship
between a dependent (target) and independent variable (s) (predictor) by using a best fit line. This
technique is used for forecasting, time series modeling and finding the causal effect relationship
between the variables.
Regression is of multiple types:
a) Linear regression: Linear regression attempts to model the relationship between two variables
by fitting a linear equation: using one dependent variable and one independent variable.
b) Multiple regression: Multiple regression is an extension of simple linear regression. It is used
when we want to predict the value of a dependent variable based on the value of two or more
other independent variables
c) Logistic regression: Logistic Regression is used to predict the categorical dependent variable
using a given set of independent variables. Logistic regression is a class of regression where
the independent variable is used to predict the dependent variable. When the dependent variable
has two categories, then it is a binary logistic regression.
d) Polynomial regression: Polynomial regression is a form of regression analysis in which the
relationship between the independent variable x and the dependent variable y is modelled as an
nth degree polynomial in x.

• Ratio trend analysis

Ratio analysis is the process of determining the future demand for human resources by calculating the
ratio between a particular business variable and the number of employees a company needs. It
especially helps you forecast those growth-driven personnel needs.
Example: Ratio analysis can use historic information to project future staffing needs. The ratio
establishes a relationship between the number of employees needed and another factor such as past
staffing levels or past gross sales revenues.

• Delphi technique

The Delphi technique is a group communication method where a panel of experts arrive at a consensus
over a series of questions and discussions.
Delphi Technique a Step-by-Step Guide
Step 1: Choose a Facilitator. The first step is to choose your facilitator.
Step 2: Identify Your Experts.
Step 3: Define the Problem. What is the problem or issue you are seeking to understand?
Step 4: Round One Questions.
Step 5: Round Two Questions.
Step 6: Round Three Questions.
Step 7: Act on Your Findings.
Conclusion.
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J. COMPENSATION AND BENEFITS

Total Rewards
Total rewards include everything the employee perceives to be of value resulting from
the employment relationship.

Total Rewards Pie

A brief description of the six elements:
1. Compensation: Pay provided by an employer to its employees for services rendered (i.e., time, effort,
skill). This includes both fixed and variable pay tied to performance levels.
2. Benefits: Programs an employer uses to supplement the cash compensation employees receive. These
health, income protection, savings and retirement programs provide security for employees and their families.
3. Work-Life Balance: A specific set of organizational practices, policies and programs, plus a
Philosophy that actively supports efforts to help employees achieve success at both work and home.
4. Rewards &Recognition: Acknowledgements or special attention given to employee efforts for positive
performance. It meets an intrinsic psychological need for appreciation and can support business strategy by
reinforcing certain behaviors that contribute to organizational success. Awards can be cash or non-cash
5. Career Enhancement: The alignment of organizational, team and individual efforts toward the
achievement of business goals and individual goals.

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The Aon Hewitt Total Reward Framework:
The HR consulting firm uses a four-quadrant model to illustrate the concept of total rewards. Everything an
employee receives from an employer (i.e., not just those elements listed above as examples) can be positioned
within this framework, depending on whether the reward element is:
i. Financial or Experiential—financial elements have a clearly defined value or cost, while experiential
elements are those the employee experiences through interaction with the company, leadership,
management, colleagues, and customers.
ii. Personal or Company—some rewards are tailored to the individual (e.g., salary, bonus, personal goals,
development plan, etc.), while others are provided in more or less the same way to all employees (e.g.,
benefits, culture, work environment).

While virtually every organization provides rewards in each of the four quadrants, many leading companies
are keenly interested in finding ways to shift more of the total rewards elements up and to the right. This is
because we know that more personal and experiential rewards create a stronger emotional bond between
employees and the company.

Difference between Wages and Salary:

Wages are generally paid per hour. This means that one has to be present and working in order to get paid.
Most of the time, wage jobs are not as inclusive when it comes to things like paid vacations or paid sick days.
Wage earners often have to give up pay for leaving early, coming in late, missing a day, or taking a vacation.

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Salary refers to how much you get paid every year. Salary earners rarely have to punch a time clock, or keep
an accurate account of their hours, because they get paid for performance rather than by the hour. Salary can
also be counted in terms other than money.
Wages are expressed as an hourly payment and salary as packages.
Components of Compensation
A. Fixed Pay
The nondiscretionary compensation that does not vary according to performance or results achieved. It
usually is determined by the organization's pay philosophy and structure. Also, known as guaranteed or
committed pay. Sub-components:
1. Basic Salary: Core of the salary as a number of components may be calculated based on this
amount.
2. Allowances: Fixed quantity of money for the purpose of meeting particular requirements connected with
service. The organizations are free choose the allowances depending on organizational and employee
requirements. A few key allowances are:
• House Rent Allowance: - Provided that expenditure on rent is actually incurred
• Leave Travel Allowance: For travel to any place in India. For Self, Spouse, Children & Dependent
Parents & Siblings
• Uniform Allowance: -Allowance granted to meet the expenditure incurred on the purchase or
maintenance of uniform for wear during the performance of the duties of an office or employment of
profit
• Children Education Allowance & Children Hostel Allowance
• Transport Allowance: -To compensate the cost incurred in commuting between place of residence
and place of work.
3. Medical Reimbursement: The expenses incurred by employee to meet health related expenditure,
such as medicines, doctor's fees etc. of the employee and his family members.
4. Medical Insurance
5. Meal Coupons
6. Gift Vouchers
7. Retirals: While Provident Fund and Gratuity are mandatory, the other schemes are the discretion of the
employer.

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B. Variable Pay: Also referred to as ‘Pay at Risk’ – is part of the compensation package that has to be earned
usually by meeting and exceeding individual, team, organization performance criteria. Variable pay instills
the following:
1. discretionary effort
2. links reward to performance and promotes common interests
3. shouldering more business risks – rewarding ‘upside’ and penalizing ‘downside’ of performance

Components of Benefits
1. Health Insurance: This is in the form of health insurance plan which caters to the various health
problems, diseases and hospitalization covers the employee of family members.
2. Life-insurance and Retirement: Life insurance and retirement options encourage employees to remain
with the same company because they do not want to cash in their life insurance or retirement plans. Such
plans include medical insurance, life insurance, dental insurance, optical insurance, business travel
insurance etc.
3. Leave: this includes certain no of paid sick days (medical leave), casual leave. Such leaves lapse at the
year end. No of medical leaves are also fixed by the company.
4. Employee assistance programs (EAP): These are employee benefit programs offered by many
employers in conjunction with health insurance plans.
5. Employee Stock Option Plans (ESOP): They are a call option on the common stock of the company
issued in the form of non-cash compensation. E.g. Infosys
6. Golden Handshake: It is an employee contract that provides the executive with a significant severance
package in case of losing the job through layoff, retrenchment or even retirement.

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K. CORPORATE SOCIAL RESPONSIBILTY
➢ It is a corporate initiative to assess and take responsibility for the company's effects on the environment
and impact on social welfare. The term generally applies to company efforts that go beyond what may
be required by regulators or environmental protection groups.
➢ Corporate social responsibility may also be referred to as "corporate citizenship" and can involve
incurring short-term costs that do not provide an immediate financial benefit to the company, but
instead promote positive social and environmental change.
➢ Under the new Companies Act, certain class of profitable entities are required to shell out at least two
per cent of their three-year annual average net profit towards Corporate Social Responsibility (CSR)
activities.
➢ Asking stakeholders to "liberally" interpret the provisions in Schedule VII (Companies Act) -- that
relates to CSR works -- the government has said that CSR activities should be undertaken only in
"project/programme" mode.
➢ "One-off events such as marathons/awards/charitable contribution/advertisement/sponsorships of TV
programmes etc. would not be qualified as part of CSR expenditure," the Corporate Affairs Ministry
has said.
➢ According to the Ministry, salaries paid by the companies to regular CSR staff as well as to volunteers
(in proportion to company’s time/hours spent specifically on CSR) can be factored in as CSR
expenditure.
➢ Clarifying about the time period of three years for calculating CSR spend, the Ministry has said "any
of the three preceding financial years" would be taken into account for the purpose.
➢ "Expenditure incurred by Foreign Holding Company for CSR activities in India will qualify as CSR
spend of the Indian subsidiary if, the CSR expenditures are routed through Indian subsidiaries and if
the Indian subsidiary is required to do so as per section 135 of the Act," the Ministry said in a circular.
➢ The Ministry has also prepared an illustrative list of activities that can be classified as CSR work.
Among them, "renewable energy projects" would be considered as a CSR activity provided that it is
not part of the particular company's business.
➢ CSR rules are applicable to companies having at least Rs 5 crore net profit, or Rs 1,000 crore turnover
or Rs 500 crore net worth.
Role of HRM
➢ Human Resource Departments play a critical role in ensuring that the company adopts Corporate
Social Responsibility programs. Furthermore, HR can manage the CSR plan implementation and
monitor its adoption proactively, while documenting (and celebrating) its success throughout the
company.
➢ Human Resources technology can help with a Corporate Social Responsibility program, including
reducing the company's carbon footprint to benefit the planet. Start with these areas:
• Implement and encourage green practices.
• Foster a culture of social responsibility.
• Celebrate successes.
• Share and communicate the value of corporate social responsibility to employees and the
community.

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 ➢ A CSR program can be an aid to recruitment and retention, particularly within the competitive graduate
student market.
➢ CSR can also help improve the perception of a company among its staff, particularly when staff can
become involved through payroll giving, fundraising activities or community volunteering.
➢ CSR has been found to encourage customer orientation among frontline employees. Employee
involvement is a critical success factor for CSR performance.
➢ Human resource managers have the tools and the opportunity to leverage employee commitment to,
and engagement in, the firm's CSR strategy.
➢ High performing CSR organizations foster a culture of CSR and fully integrate CSR throughout their
operations, rewarding and incentivizing CSR decisions and initiatives.
➢ Employees prefer to work for organizations aligned with their values; thus, incorporating CSR into
the employee brand can enhance recruitment and retention, particularly in tight labour markets.
➢ CSR can be applied to the HR toolkit, resulting in a roadmap or pathway for human resource
practitioners to follow who wish to contribute to the achievement of their organization's sustainability
and business aspirations, thereby improving social and environmental conditions locally and globally.
List of Activities under Section VII, Companies Act, 2013
• Eradication of Extreme Hunger and Poverty.
• Promotion of Education.
• Gender Equity and Women Empowerment.
• Reducing Child morality and improving maternal health.
• Combating HIV-AIDS, malaria and other diseases.
• Contributing to Prime Minister’s relief fund and other such state and central funds.
• Social Business projects.
• Environmental Sustainability.
• Employment enhancing vocational skills.

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CSR Initiatives by Companies
a) Tata Group
➢ Corporate Social Responsibility in Indian Industry traces its roots from Jamshedji Tata, founder of
Tata group. Tata has been active in community services way before CSR was mandated in Companies
Act.
➢ In 1979, Launched concerted rural development initiatives.
➢ In 1995, set up Tata Council for Community Initiatives – provides superstructure for CSR efforts
across the group.
➢ In 2003, set up Tata Index for Sustainable Development – a CSR measure adopted across the Tata
group.
➢ Tata Engage, encourages Tata colleagues to connect with society at large, to develop a deep
understanding of our core purpose to improve the quality of life of the communities we serve globally.
➢ The Tata Group also runs a group CSR programme called Tata STRIVE that equips communities with
information, technology and the capacity to achieve improved health, education and livelihood
outcomes.
➢ Their initiatives have several areas of impact, viz., Environment, Employee relations, Economic
growth, Civic amenities, Community service, Population management, Sports & adventure, Health
for all, Relief during natural calamities, Education/Arts & Culture.
➢ Founder Member of Global Business Coalition on HIV/AIDS.
➢ 1st Indian Company to publish Corporate Sustainability Report as per GRI guidelines.
➢ Tata Steel caters to over 600 villages and several company towns, in the provinces of Orissa and
Jharkhand.
➢ Partner for Child Survival, Smile Train, Polio and Water and Sanitation Projects.

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b) ITC Limited
➢ E-choupal: Farmer knowledge empowerment through IT-Enablement
➢ Ensuring Environmental Sustainability: Carbon positive, Water positive and Solid waste recycling
positive- Wealth out of Waste (WoW) programme
➢ Social and Farm Forestry: Soil and Moisture Conservation, Solid Waste management, Promotion of
sustainable business practices
➢ Watershed development programme: brings water to dry and water-stressed areas.
➢ Women’s Empowerment programme: self-help groups
➢ Livestock Development: Cattle development centers
➢ Primary Education: Supplementary learning centers
➢ Skilling & Vocational Training: Creating sustainable livelihood opportunities
➢ Health & Sanitation: building and usage of low-cost family-owned toilets

c) Reliance Industries Limited

➢ Started DHRISTI, a nation-wide grafting drive to bring light into the lives of visually challenged from
the under privileged segment of the society, has restored the gift of sight to over 5500 Indians.
➢ Reliance Kargil Scholarship Scheme: To support educational needs of children of defence personnel
who sacrificed their lives or were disabled during Kargil war. 87 children have received financial
support for their education for Standard VI-XII.
➢ Various environment programs such as tree plantation, water conservation, harvesting and energy
saving initiatives have been taken up
➢ Reliance operates the Dhirubhai Ambani Hospital, Lodhivali and renders quality medical services to
the rural population and highway accident victims.
➢ Women & Youth Empowerment Programmes
➢ Project Jagruti: A project to uplift and bring dyslexic students from the underprivileged segment into
the mainstream
➢ Reliance Dhirubhai Ambani Protsaham Scheme: A scheme for supporting meritorious students and
providing financial aid to the toppers for pursuing higher studies in engineering and medical streams.

d) Mahindra & Mahindra Ltd

➢ Scholarships & Grants: have been provided to enable students to overcome their financial challenges
and fulfil their educational dreams.
➢ Project Nanhi Kali: Supports the education of underprivileged girls from poor urban, remote rural and
conflict afflicted tribal communities.
➢ Mahindra Pride school: livelihood training to youth from socially and economically disadvantaged
communities
➢ Lifeline Express: Providing remote rural areas an access to healthcare
➢ Project Hariyali: planting a million trees every year
➢ Watershed Management: water conservation, soil conservation & increasing availability of water for
irrigation

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 ➢ Swachh Bharat Swachh Vidyalaya programme: construction of public toilets, primarily for girls
➢ Wardha Farmer family & Krishi Mitr project: training small & marginal farmers in effective farming
practices.

e) Godrej Industries Limited

➢ Godrej Memorial Hospital (GMH) - Provides quality healthcare at affordable rates. GMH offers
surgery and Hospitalization to the patients free of cost
➢ Partnered with US based NGO ‘Smile Train’ which helps in performing corrective cleft lip for
Underprivileged children
➢ Group supports ‘Table for Two’ which is targeted at removing hunger and malnutrition in developing
world
➢ Supported ISCKON foundation for mid-day meal programme
➢ Heroes aids project: Contributes strongly to national and regional effort to address HIV related stigma
and discrimination
➢ Funds Teach for India
➢ Good AND Green: The group aspires by 2020 to create a more employable Indian workforce, a greener
India and innovate for good and green products
➢ Donation from employees to GOONJ for disaster relief

f) Wipro
➢ Wipro Cares contributes to learning enhancement & disaster rehabilitation
➢ Applying thought in Schools: to bring about educational reform.
➢ Mission 10X: to enhance the employability of engineering graduates
➢ Eco-Eye: to incorporate better ecological in every project they execute
➢ Biogas plants, Rainwater harvesting & Eco-friendly Chemical
➢ Earthian: to build skills, attitudes & values to shape sustainability thinking & doing amongst young
people

g) Cummins India Limited

➢ ‘Every Employee Every Community initiative’ (EEEC), each employee is encouraged to dedicate a
minimum of four working hours towards any of the projects undertaken under three broad focus areas
viz.
• Higher Education: to provide opportunities to students from economically weaker sections and
under privileged groups in society, to pursue Higher Education and enhance their
employability
• Energy and Environment: planting saplings, cleaning water bodies and campaigning for public
awareness towards a cleaner and healthier society
• Local Community Infrastructure Development and Social Justice: interventions in education,
agriculture, sanitation, health care & water conservation

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L. MISCELLANEOUS TOPICS

1. EMPLOYER BRANDING

Employer brand is an organization's reputation as an employer. Minchington (2005) defines employer

brand as "the image of an organization as a 'great place to work'". The process of employer branding
is concerned with talent attraction, engagement and retention strategies deployed to enhance your
company's employer brand.
While the term "employer brand" denotes what people currently associate with an organization,
employer branding has been defined as the sum of a company's efforts to communicate existing and
prospective staff what makes it a desirable place to work, and the active management of company's
image as seen through the eyes of its associates and potential hires".

EMPLOYER BRANDING PROCESS

Components of an Employer Branding Process

I. Research & Advisory Services: The Company needs to understand what it offers of value, as defined
in the EVP, to current and prospective employees. Top Management also needs to believe and actively
support the EVP. If the company is unaware or unsure of the value it offers Top Talent, the Employer
Brand cannot be activated or effectively promoted.
II. Activation & Talent Sourcing: The activation phase requires a holistic communication, marketing
and talent sourcing plan to ensure the company is getting the right kind of talent aboard. While the
talent sourcing’s role is to ensure company-candidate compatibility, marketing and communications
aim for top talent in establishing the company as the employer of choice.

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III. KPI Development & Tracking: For effective employer brand promotion, constant testing and
measuring (when using different campaign techniques, messages, channels, etc.) is required. It is
imperative for a company to set Key Performance Indicators (KPIs) and keep track of performance
levels in order to make continuous improvements.

2. EMPLOYEE VALUE PROPOSITION (EVP)

• Employee Value Proposition (EVP) is the balance of the rewards and benefits that are received by
employees in return for their performance at the workplace. Organizations generally develop an EVP
to provide a consistent platform for employer brand communication and experience management.
• Minchington (2005) defines an Employee Value Proposition (EVP) as a set of associations and
offerings provided by an organization in return for the skills, capabilities and experiences an employee
brings to the organization. The EVP is an employee-centered approach that is aligned to existing,
integrated workforce planning strategies because it has been informed by existing

employees and the external target audience. An EVP must be unique, relevant and compelling if it
is to act as a key driver of talent attraction, engagement and retention.
• Benefits to an organization of a well-formed EVP include attraction and retention of key talent, helps
prioritize the HR agenda, creates a strong people brand, helps re-engage a disenchanted workforce,
and reduces hire premiums.

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3. HUMAN RESOURCES INFORMATION SYSTEM (HRIS)
A Human Resources Management System (HRMS) or Human Resources Information System (HRIS),
refers to the systems and processes at the intersection between human resource management (HRM)
and information technology. It merges HRM as a discipline and in particular, it is basic HR activities
and processes with the information technology field, whereas the programming of data processing
systems evolved into standardized routines and packages of enterprise resource planning (ERP)
software. Overall, these ERP systems have their origin from software that integrates information from
different applications into one universal database. The linkage of its financial and human resource
modules through one database is the most important distinction to the individually and proprietary
developed predecessors, which makes this software application both rigid and flexible.
Organizations may have formalized selection, evaluation, and payroll processes. Over the past few
decades, management of "human capital" has progressed to an imperative and complex process. The
HR function consists of tracking existing employee data which traditionally includes personal histories,
skills, capabilities, accomplishments and salary. To reduce the manual workload of these administrative
activities, organizations began to electronically automate many of these processes by introducing
specialized human resource management systems. HR executives rely on internal or external IT
professionals to develop and maintain an integrated HRMS.
Currently, human resource management systems encompass:
1. Payroll
3. Performance appraisal
4. Benefits administration
5. Timesheet Management
6. Recruiting/Learning management
7. Performance record
8. Employee self-service
9. Scheduling
10. Absence management
11. Analytics
Payroll module automates the pay process by gathering data on employee time and attendance,
calculating various deductions and taxes, and generating periodic pay cheques and employee tax
reports. Data is generally fed from the human resources and time keeping modules to calculate
automatic deposit and manual cheque writing capabilities. This module can encompass all employee-
related transactions as well as integrate with existing financial management systems.

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Time and attendance module gather standardized time and work-related efforts. The most advanced
modules provide broad flexibility in data collection methods, labour distribution capabilities and data
analysis features. Cost analysis and efficiency metrics are the primary functions.
Benefits administration module provides a system for organizations to administer and track employee
participation in benefits programs. These typically encompass insurance, compensation, profit sharing
and retirement.
HR management module is a component covering many other HR aspects from application to
retirement. The system records basic demographic and address data, selection, training and
development, capabilities and skills management, compensation planning records and other related
activities. Leading edge systems provide the ability to "read" applications and enter relevant data to
applicable database fields, notify employers and provide position management and position control.
Human resource management function involves the recruitment, placement, evaluation, compensation
and development of the employees of an organization. Initially, businesses used computer-based
information systems to:
• Produce pay checks and payroll reports.
• Maintain personnel records.
• Pursue talent management.
Training module provides a system for organizations to administer and track employee training and
development efforts. The system, normally called a "learning management system" (LMS) if a
standalone product, allows HR to track education, qualifications and skills of the employees, as well as
outlining what training courses, books, CDs, web based learning or materials are available to develop
which skills. Courses can then be offered in date specific sessions, with delegates and training resources
being mapped and managed within the same system. Sophisticated LMS allow managers to approve
training, budgets and calendars alongside performance management and appraisal metrics.
Employee self-service module allows employees to query HR related data and perform some HR
transactions over the system. Employees may query their attendance record from the system without
asking the information from HR personnel. The module also lets supervisors approve O.T. requests
from their subordinates through the system without overloading the task on HR department.
Analytics module enables organizations to extend the value of an HRMS implementation by extracting
HR related data for use with other business intelligence platforms. For example, organizations combine
HR metrics with other business data to identify trends and anomalies in headcount in order to better
predict the impact of employee turnover on future output.

HRIS: BENEFITS
• Faster information process
• Greater information accuracy
• Improved planning and program development
• Enhanced employee communications

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 HRIS: CHALLENGES
• Lack of Management Commitment
• No or Poorly Done Needs Analytics
• Failure to Include Key People
• Failure to Keep Project Team Intact Politics /Hidden Agendas
• Failure to Involve/Consult Significant Groups
• Lack of Communication
• Bad Timing (Time of Year and Duration)

4. HR ANALYTICS
Definition
Human resource analytics (HR analytics) is an area in the field of analytics that refers to applying
analytical/ statistical processes to the human resource department of an organization with the aim of
improving employee performance and therefore getting a better return on investment.

Significance
What HR analytics does is correlate business data and people data, which can help establish important
connections later on. The key aspect of HR analytics is to conclusively show the impact the HR
department has on the organization as a whole. Establishing a cause-and-effect relationship between
what HR does and business outcomes - and then creating strategies based on that information
- what HR analytics is all about.

Scope
In Human Resources, with the automation of many HR transactions, from recruitment to retirement
along with the need to perform strategically, analytics of the workforce is more important than ever.
HR analytics is a lot more than head-counting--it is about the total amount and the quality of talent,
knowledge, and expertise to move your organization forward and stay ahead of competition. It is about
measuring the return on human capital investment and measuring the impact and how HR is driving
performance, productivity, and profitability. Analytics of the workforce, a company's most important
asset, should be an opportunity for businesses, particularly for HR, to transform itself and align with
the business strategy.

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 TYPES OF DATA ANALYTICS

Descriptive analytics

Descriptive analytics answers the question of what happened. For instance, a healthcare provider will learn
how many patients were hospitalized last month; a retailer – the average weekly sales volume; a manufacturer
– a rate of the products returned for a past month, etc.
Descriptive analytics juggles raw data from multiple data sources to give valuable insights into the past.
However, these findings simply signal that something is wrong or right, without explaining why.

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Diagnostic analytics

At this stage, historical data can be measured against other data to answer the question of why something
happened. In diagnostic analytics, there is a possibility to drill down, to find out dependencies and to identify
patterns. Companies go for diagnostic analytics, as it gives a deep insight into a particular problem.

Well-designed business information (BI) dashboards incorporating reading of time-series data (i.e. data over
multiple successive points in time) and featuring filters and drill down capability allow for such analysis. For
example, users can find the right candidate to fill a position, select high potential employees for succession,
and quickly compare succession metrics and performance reviews across select employees to reveal
meaningful insights about talent pools

Predictive analytics

Predictive analytics tells what is likely to happen. It uses the findings of descriptive and diagnostic analytics
to detect tendencies, clusters and exceptions, and to predict future trends, which makes it a valuable tool for
forecasting.

For e.g. a telecom company, can identify the subscribers who are most likely to reduce their spend, and trigger
targeted marketing activities to remediate; a management team can weigh the risks of investing in their
company’s expansion based on cash flow analysis and forecasting. A company can predict based on analysis
which employee is most likely to leave the organization

Prescriptive analytics

The purpose of prescriptive analytics is to literally prescribe what action to take to eliminate a future problem
or take full advantage of a promising trend. This state-of-the-art type of data analytics requires not only
historical data, but also external information due to the nature of statistical algorithms. Besides, prescriptive
analytics uses sophisticated tools and technologies, like machine learning, business rules and algorithms,
which makes it sophisticated to implement and manage.

Research methodology

It is a way to systematically solve the research problem. Research methods may be understood as all those
methods/techniques that are used to conduct research. It entails specific procedures or techniques to identity,
select, process and analyse a problem. It has two broad categories:

Qualitative:

This pertains to subjective assessment of attitudes, opinions and behaviour. Research in such a situation is a
function of researcher’s insights and impressions using focus group interviews, projective techniques and
depth interviews are used.
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Quantitative:

This is the type where there is a requirement of data and that data is analysed to come to a certain conclusion.

Inferential: This includes forming a database from which characteristics or relationships of population are
inferred. This usually means survey research where a sample of population is studied to determine its
characteristics, and it is then inferred that the population has the same characteristics.

Experimental: Under this, some variables are manipulated to observe their effect on other variables. The
experiment is thus done to access the effect those other variables will have if there are changes occurring in
other variables.

Quantitative research is done based on the data collected and then using that data as sample. There are several
ways to sample a data. A type of data sampling can be chosen depending on the need of the project or as per
the discretion of the person analysing the data.

Data analytics has a huge role to play in Human resources. Almost, at every stage, there is a requirement to
conduct data analysis in order to reach a more conclusive result, which in turn leads to better decision making.

The COVID-19 pandemic has boosted the requirement for data analytics and digitization even further and at
a much faster pace than anticipated. It becomes important to see every stage and every step in Human Resource
Management from the perspective of having a concrete analysis via HR Analytics.

Read More (Highly non-exhaustive)

• Deloitte | Workforce Analytics
• Five Important HR Analytics
• SlideShare | HR Analytics
• Making HR Analytics a Reality: 5 Proven Paths to Success

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5. HR CONSULTING
HR consulting is the practice of delivering all aspects of human resource management advisory services
as an external provider, and with the professional and business issues associated with operating such a
practice—including client development, contracts and client management. The demand for these services
is not limited to large organizations. For independent HR consultants, in fact, the greatest area of
opportunity might be with small companies. As more organizations have chosen to lighten their staffing
burdens by contracting for HR services, outsourcing opportunities have grown for independent HR
consultants.

Consultancy Framework

Important functions of HR Consulting

• Advise companies on best human capital management practices
• Help clients strategically integrate effective HR processes, programs and practices into their daily
operations
• Perform internal reviews and audit of current systems and processes

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 • Perform quality assurance checks
• Develop employee restructuring plans
• Human Capital, including remuneration (also called total rewards), employee rewards and
incentive programs, and talent acquisition and management
• Health & Benefits, orchestrating optimal employee health plans with the carrier themselves
• Mergers & Acquisitions, examining fit across culture, job type, and transaction costs, etc.
• Communication, including surveying employee attitudes, satisfaction, engagement, and other
employee behaviors
• Devise retirement and severance packages
• Recruitment process outsourcing
• Provide advice on discipline process, conduct disciplinary review conferences and advise on
appropriate outcomes
Consulting Skills
• Problem Solving: Analyzing data, providing structure, Drawing inferences, Attention to details
• Planning: Prioritizing, Multi-tasking
• Teamwork: Working with internal and external team, Networking to create trusted relationship
• Communication: Verbal and written, Influencing skills
Key business considerations for HR consultants
• Areas of focus: Determine whether the consultancy will provide general or specialized HR services,
and identify services that will be provided.
• Target market(s): Determine the target market to be served (industry, geography, main point of client
contact, etc.).
• Legal structure: Determine whether the business will operate as a sole proprietorship, Limited
Liability Corporation, S Corporation etc. Decide whether the consultancy will be operated
independently, or whether staff or partners will be necessary to meet client needs.
• Financial: Identify revenue and expense expectations and establish a preliminary budget for
operations.
• Administrative: Determine how business operations will be managed, including such matters as
invoice management, collections, tax considerations, etc. Identify necessary outside resources (e.g.,
legal, financial).
• Insurance: Identify insurance needs, which include health and life insurance as well as professional
liability insurance. The type and level of coverage selected will be based on the HR consultant’s
financial situation, level of exposure and degree of acceptable risk.
• Licensing: Determine licensing requirements. States, as well as many cities and counties, have
different rules about business licenses. HR consultants should check with the appropriate agencies to
determine requirements for doing business in their area

6. INDUSTRY 4.0

The rise of new digital industrial technology, known as Industry 4.0, is a transformation that makes it
possible to gather and analyze data across machines, enabling faster, more flexible, and more efficient

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processes to produce higher-quality goods at reduced costs. This manufacturing revolution will
increase productivity, shift economics, foster industrial growth, and modify the profile of the
workforce—ultimately changing the competitiveness of companies and regions. Industry 4.0 combines
relevant physical and digital technologies, including analytics, additive manufacturing, robotics, high-
performance computing, natural language processing, artificial intelligence and cognitive technologies, advanced
materials, and augmented reality.

In the present context of the Industrial Revolution 4.0, organizations are expected to maximize their
capabilities with smart talent and efficient technology. Together with Marketing and Sales technologies,
FinTech, and AI and machine learning, HR Technology has become the core technology stack for a top-
notch organization that values People-Technology. As more organizations rush to embrace technologies
such as AI tools, Robotics and Cloud, HR Tech makers are expected to double their efforts into
innovation and research.

KEY IMPACTS OF INDUSTRY 4.0 AT ORGANISATIONAL LEVEL

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HR Technology can be defined as a set of tools and technologies used by Human Capital professionals to
research, analyze, organize, manage and enable HR business performance through integration of people and
technology. HR Technology is the application of AI and other smart tools to augment or transform your HR
processes backed by data-centric skills to handle these technologies.

7. BLOCKCHAIN

Blockchain is mostly known as the backbone technology behind Bitcoin and is one of the hottest and
most intriguing technologies in the market. Like the rise of the internet, blockchain has the potential
to truly disrupt multiple industries and make processes more secure, transparent, and efficient.
Blockchain provides a decentralized and secure ledger which gives participating parties a way of
validating the information related to a transaction. In doing so, it speeds up the process and cuts out
any middlemen.

HR blockchain in payroll
Unlike sending out payroll electronically in a domestic setting, sending overseas is consistently
expensive for businesses. The long-term inefficiencies of overseas payroll payments can add up.
Currency volatility can have an immediate effect on both the employer and employee. So, time is
money and an international payroll blockchain solution simply offers a faster solution than existing
models.

HR blockchain in certification
Employers face a major hiring hurdle when they need to verify information on a candidate's resume.
There is no doubt that resume accuracy is a common problem and the effort to verify credentials
impacts on the hiring process and costs employers time and money. Blockchain technology could be
brought in to solve certification issues, to increase transparency and in turn address fraud in employee
credentials.

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 Blockchain will automate taxes and make them more accurate

Taxes for contract workers are complicated. From write-offs to estimated taxes, the annual tax burden
is a headache for workers and employers alike.

Blockchain will streamline routine tasks

Everything from tracking payroll to issuing pay checks to managing contracts is more efficient with
blockchain. The technology allows companies to send and receive funds instantly and securely
anywhere in the world without using a bank as a go-between, and without the corresponding fees that
apply. It can also cut out many of the day-to-day tasks of managing contracts by implementing smart
contracts which can automatically carry out predetermined terms.

8. CHANGE MANAGEMENT
In simple terms, Change Management means to apply a systematic approach for helping the individuals
impacted by the “change” be successful by building support, addressing resistance and developing the
required knowledge and ability to implement the change (managing the people side of the change). It
is the process of helping individuals and your organization transition from the

current state to the desired state. It involves tools, skills, and best practices in areas that include:

• Executive leadership and support

• Communication
• Employee Involvement
• Planning and analysis
• Building support through effective preparation
• Addressing factors that will create resistance to change

Kotter’s 8 step Change model

Step 1: Create a sense of Urgency

Help others see the need for change through a bold, aspirational opportunity statement that
communicates the importance of acting immediately.

Step 2: Build a guiding coalition

A volunteer army needs a coalition of effective people to guide it, coordinate it, and communicate its
activities.

Step 3: Form strategic vision and initiatives

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 Clarify how the future will be different from the past and how you can make that future a reality

through initiatives linked directly to the vision.

Step 4: Enlist a volunteer army

Large-scale change can only occur when massive numbers of people rally around a common
opportunity. The must be moving in the same direction to drive it further.

Step 5: Enable action by removing barriers

Removing barriers such as inefficient processes and hierarchies provides the freedom necessary to
work across silos and generate real impact.

Step 6: Generate short-term wins

Short term goals can be made rewarding. These goals must be recognized, collected and
communicated, early and often, to track progress and energize volunteers to persist

Step 7: Sustain acceleration

Work harder after the first successes. Your increasing credibility can improve systems, structures and
policies and initiating change after change until the vision is a reality can help it convert into reality.

Step 8: Institute change

Articulate the connections between the new behaviors and organizational success, making sure they

continue until they become strong enough to replace old habits.

Change management can be useful in a number of scenarios. Few of them are listed below:
• Redefining Employee Roles and Responsibilities
• Reducing or Eliminating Resistance to Change
• Implementing Changes in Distinct Phases
• Providing Support Systems and Training Programs for Change
• Cultural integration in cases of Mergers and Acquisitions

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