Module I: Introduction to HRM

Human Resource Management

Course Code: XBB2002
 Human Resource Management

Definition:
According to Invancevich and Glueck et al, Human Resource
Management (HRM) is concerned with the most effective use of
people to achieve organizational & individual goals.

HRM is a strategic approach to the acquisition, motivation,

development and management of the organization’s human
resources (Sharma, A.M.)
 Human Resource Management

Features of Human Resource Management

• Pervasive Force: HRM is pervasive in nature; it is present in all organizations &

permeates at all levels of management in an organization.
• Action Oriented: HRM focuses attention on action, rather than on record keeping,
written procedures or rules. The problems of the employees are solved through
rational policies.
• Individual Oriented: HRM attempts to help the employees develop their potential &
thereby encourages them to give their best to the organization.
• People Oriented: HRM is concerned about people at work, both as individuals, as well
as in groups & teams. It aims to put people on assigned jobs in order to achieve
desired performance levels.
• Development Oriented: It intends to develop the full potential of employees. Further
the reward & incentive structures are also effectively utilized so as to encourage
people for meeting their individual growth & development needs.
 Human Resource Management

• Integrating Mechanism: HRM tries to build & maintain cordial relations between people
working at various levels of the organization & also forms the bridge between the other
functional areas like marketing, finance etc.
• Comprehensive Function: HRM, to some extent, is concerned with any organizational
decision which has an impact on the workforce or the potential workforce (Bernardin et al). It
involves a method of developing potentialities of employees so that they get maximum
satisfaction out of their work & give their best efforts to the organization (Pigors & Myers).
• Auxiliary/Support Service: HR departments exist to assist & advise the line or operating
managers to effectively accomplish their personnel work more effectively.
• Inter-disciplinary Function: It is a multi-disciplinary activity, utilizing the knowledge & inputs
drawn from psychology, sociology, anthropology, economics, etc.
• Continuous Function: HRM is an ongoing process.
 Human Resource Management
Scope of HRM:
Human Resource Management has the following scopes, namely:

Nature
of HRM
Prospects Employee
of HRM Hiring

Industrial
HRM Employee &
Relations Executive
Remuneration

Employee Employee
Maintenance Motivation
Objectives of HRM

How are functions related to these objectives?

 Human Resource Management

Objectives & Functions of HRM:

Human Resource Management has the following objectives & functions, namely:
• To enable the organization accomplish its goals & objectives
• To employ the skills & abilities of the workforce efficiently
• To provide the organization with well-trained & well-motivated employees.
• To increase to the fullest, the employee’s Job Satisfaction & Self-actualization.
• To develop & maintain a Quality of Work Life (QWL).
• To communicate HR policies to all employees effectively
• To help maintain ethical policies & behavior at the work place.
• To maintain discipline & address employee grievance & dissatisfaction more promptly &
effectively.
• To maintain a cordial relationship in between the employees at various levels with the
management of the organization.
 Human Resource Management
Personnel Management:
It is defined as a set of programs, functions & activities designed to maximize both personal
& organizational goals & objectives.

Personnel Management

Personnel Aspect: Welfare Aspect: Industrial Relations Aspect:

Recruitment & Selection Working Conditions & QWL Trade Union Management
Training & Development Amenities & Facilities Dispute settlement
Appraisal Benefits Grievance handling
Compensation & Productivity Entertainment Collective Bargaining
 Human Resource Management

Features of Personnel Management:

• Concerned with employees both as individuals and as a group
• Responsible for the development of human resources
• Covers all levels & categories of employees
• It is a continuous process
• Aims to attain organizational, individual & societal goals.
• It is a responsibility of all Line managers & function of Staff managers
 Human Resource Management

• Human Resource Development (HRD): HRD means developing or trapping hidden

qualities in people in order to make them accomplish new functions leading to
organizational & individual goals.

Objectives of HRD:
• To acquire or sharpen capabilities required to perform functions associated with the
organization’s present as well as expected future roles.
• To develop general capabilities of individuals & exploit their inner potential for their own
and / or organizational development purposes.
• To develop an organizational culture where team work & collaboration contributing to the
professional well being & motivation of the employees.
DEVELOPMENT OF HR FUNCTIONS
 Human Resource Management

Functions of HRM:

A. Managerial: Planning, Organizing, Directing & Controlling

B .Operational:
Employment : (Job Analysis, HRP, Recruitment, Selection,
Placement, Induction & Orientation)
HRD: (Performance Appraisal, Training & Development, Career & Succession Planning,
Organization Development)
C. Compensation:
Job Evaluation; Wage & salary Administration, Incentive, Bonus, Fringe Benefits management;
Social security measures
D. Human Relations: Employee Relations
E. Managing effectiveness of HRM:
Organization Health
Organization Culture & Climate
HR Accounting, Audit & Research
 Human Resource Management

HR Mechanisms / Subsystems:
• Manpower Planning (Human Resource Planning)
• Employee Recruitment & Selection
• Onboarding and Placement
• Employee Orientation
• Performance Appraisal & Potential Appraisal
• Career Planning & Succession Planning
• Training & development
• Organization Development
• Employee Rewards, compensation & benefits Management
• Employee Relations Management
• Employee Welfare & QWL (Quality of Worklife)
• Human Resource Accounting & Human Resource Audit
HRM Model
 Human Resource Management
HR Policy: Broad guidelines defining how the HR function in an organization would
be performed and or followed
HR Policy (Advantages): Delegation, Uniformity, better control, Standards of efficiency,
confidence, speedy decision making, co-ordination.

Characteristics of an effective HR Policy:

• Relatedness to organizational and HR objectives
• Preciseness
• Factual
• Easily understandable
• Stable & Flexible
• Appropriateness
• Just, fair & equitable
• Reasonable & Reviewable
 HR Organization (Structure of HR Dept.)
What is Human Resource Organization:
Human Resource Organization is concerned with achieving success by organization
design & development, motivation, the application of effective leadership, and the
process of getting across the message about what the enterprise is setting out to do &
how it proposes to do it.

Objectives of the human resource organization:

To ensure that every aspect of the organization, employment, motivation &
management of people is integrated with the strategic objectives of the business &
contribute to the successful achievement of those objectives.
 HR Organization

The two most important issues that are relevant for the organization of a
HR department involves the following, namely:
–Place of the HR department in the overall organizational set-up.
–Composition of the HR department itself.
 HR Dept. in Organizational Structures
a) HRM in a Small-Scale Unit:
Owner/Manager

Production Sales Office Accountant

Manager Manager Manager Manager

Personnel
Assistant

b) HRM in a Large-Scale Unit:

Chairman/MD

Director Director Director Director Director

Production Finance Personnel/HR Marketing R&D
 c) Personnel Department in a Divisional Organizational Structure:
Chairman/MD

General Manager

Marketing Finance Production R&D Manager HR

Manager Manager Manager Manager

Manager Manager Manager

Southern Region Central Region Northern Region

Deputy Manager Deputy Manager Deputy Manager

Marketing Production HR

Branch Manager Branch Manager Branch Manager

Nagpur New Delhi Kolkata

Officer Officer Officer

Marketing Production HR
 Composition of a HR/Personnel Department

Owner/Manager

Manager Manager Manager Manager

Personnel Admin. HRD IR

Appraisal Training &

Development

PR Canteen Medical Welfare Transport Legal

HRP Hiring Grievance Compensation

Handling
 HR Organizational Reporting Structure in a Small Business or
Startup

• HR Manager. Generalists in their roles, they do a bit of everything including

benefits, compensation, recruiting and handling employee relations issues.
• or
• HR Director. Often responsible for HR teams of two or more, human resource
directors may serve as the highest-ranking member of HR within a smaller
company or a startup.
• HR Specialist. Focused on administration, payroll processing**, and other
administrative tasks, as well as employee orientation, training, and pre-screen
interviewing.
• *A small business will not always have specialist HR roles
HR Organizational Reporting Structure in a Small Business or
Startup
HR Dept. Structure in Mid-Sized Business
HR Dept. Structure in a Large Organization
 Functional HR Dept. Structure

• Functional organizational structure is the most common organizational

structure
• The structure of HR that includes functional areas such as recruiting and
staffing, benefits, compensation, employee relations, HR compliance,
organizational design, training and development, human resource
information systems (H.R.I.S.) and payroll.
 Flat HR Dept. Structure
• Opposite of the functional organizational structure, flat organizational structures often
have few, or no, people in middle management.
• It is literally flat meaning there are less managerial layers, so employees and managers all
work on a level playing field.
• One VP of HR might have seven direct reports each with an area of expertise like
recruiting, benefits, compensation payroll, HR business partner(s) and training and
development.
• All of these individuals directly report to the VP of HR, are the same level and have no
direct reports themselves.
• This model eliminates workplace politics and red tape to distributing responsibilities and
power equally across the HR department giving everyone a hand in the decision-making
process. This is common in small companies and startups.
 Matrix HR Dept. Structure
• Matrix organizational structure is a company structure in which the reporting
relationships are set up as a grid, or matrix, rather than in the traditional
hierarchy.
• This structure is great for project management because it offers more
flexibility and collaboration.
• In HR, different teams work with each other. One manager doesn’t oversee a
single team but employees from different areas report to a functional
manager.
• For HR, this type of structure is common for field HR leaders where belong to
a multi/cross functional project team.
• As for eg for a Director HR, Retail, for the Central Region – he may also have a
small team to support that region in roles like recruiter, HRBP, and trainer.
 Functions of HR Managers

• Operative Functions of an HR Manager: Operative functions are those tasks that ensure
the smooth functioning of the business. These include employment, development,
compensation, and workforce motivation, among others. Here are some operative
functions of an HR manager in detail.
• Service Functions: HR managers act as servicemen providing support to employees related
to their training and development needs, career counselling, work-life balance
management, compensation management (payroll), leave management, health and safety
management etc
• Technology Augmented Services: Today’s HR professionals provide HR service through
employees by championing state of the art HR technologies like HCMS (human Capital
management Systems, managing HR Chat bots and HR systems augmented by AI)
• Information Provider Function: HR managers act as the focal point of information
regarding organizational decisions both internally as well as externally as spokespersons
 Functions of HR Managers
• Organizational Peace & Discipline Management Functions: HR managers
constantly involve themselves in resolving organizational conflicts by opening
discussions with people having conflicts and promote negotiations between
conflicting parties. They are also responsible for managing strict discipline at
the workplace and behavioral monitoring
• Managerial Functions of An HR Manager: These include planning, organizing,
directing and controlling functions
–Planning: The most important function of an HR manager is planning for different things – from the
recruitment process to training and development programs. Planning also acts as a foundation for other
functions of an HR manager – like hiring needs of the organization, planning job requirements, etc.
–Organizing: After completing the planning process (mentioned above), an HR manager must undertake
this function. It requires them to develop plans and programs to achieve the business goals and satiate the
needs and desires of the employees.
 Managerial Functions of HR Managers

–Directing: HR managers require manpower to implement the plans and objectives

created by them. So, they direct employees in the direction that fulfills the plans and
objectives set by the manager. They delegate work among the team and monitor their
performance to track their progress.
–Controlling
It is one of the most important managerial roles and responsibilities of an HR manager. In
this, the HR manager observes and compares the results with the goals, and corrects and
regulates deviations. This involves activities like appraisals, audits, etc.
 Role of a HR Manager
1 Advisory Role: advising, suggesting, counseling & helping people in discharging their
responsibilities relating to grievance redressal, conflict resolution, employee selection,
training etc.

2 The Conscience Role: To inform the management about the humanitarian approach-
towards moral & ethical obligations to its employees.

3.Counselor Role: To discuss various problems of employees relating to career,

supervisors, colleagues, health, family, financial, social etc & suggest means to minimize
& overcome work stress.

4.Mediator’s Role: Resolving conflicts so as to effectively maintain industrial harmony.

5. Representative Role: To act as a representative of the organization so as to give an

overall picture of the organizational operations to the employees particularly in case of
industrial disputes or grievance redressal
.
 Role of a HR Manager
6. Fire-Fighting/Legal Role: Grievance handling, settlement of disputes, handling
disciplinary cases, collective bargaining, joint consultation, interpretation & implementation
of various labor laws, contacting lawyers, handling industrial tribunals etc.
7. Welfare Role: To provide & maintain canteens, hospitals, educational institutes, office
clubs, libraries, conveyance facilities, co-operative credit societies, consumer stores etc.
8. Problem-solver Role: To effectively handle this role regarding various short range & long
range problems of the company involving the interests of human resources.
9. Role of Change Agent: To convince workers & the management & take the lead in
implementing changes in technology, organization, production & installing the organization
development techniques etc.
10. Decision-Making Role: To play a dominant role in the decision-making process,
regarding both major & minor issues of the organization involving human resources.
11.Executive Role: Once decisions are taken HR manager plays a dominant role in executing
those decisions & programs.
 Role of a HR Manager

• Strategic Partner: In today’s organizations HR managers act as the strategic partners of

business (CHROs) helping the top management of the organization formulating strategic
perspectives of the organization.
• Technology Champion: Today’s HR managers are technology driven – particularly experts
in Big Data Analytics related to HR domain through which they facilitate strategic decision
making in organizations.
 Role of Line Managers in HRM
• A line manager is an employee who directly manages other employees and
day-to-day operations while reporting to a higher-ranking manager. Related
job titles are supervisor, section leader, foreperson, office manager and team
leader.
• They manage one or more members of staff and oversee and evaluate
employee contribution, performance and development.
• Line managers are the first point of contact for their direct reports, and they
liaise and relay information between senior leaders, HR and workers
 Role of Line Managers in HRM

Line managers can make a significant difference in:

• Enabling HR, Organizational Development and Learning & Development
policies and practices and implementing them.
• Enabling learning solutions to happen.
• Identifying learning needs and embedding learning in the workflow.
• Controlling the workflow by directing and guiding the work of others.
• Collaborating with the people profession to support change.
 Functions of Line Managers in HRM

Line managers are responsible for developing systems, handling information

and reporting. They are expected to balance that with people management
too. A first-line manager will:
–Report on performance
–Communicate objectives
–Conduct annual reviews
–Conduct interviews, hire and fire
–Guide staff through disciplinary
–Lead meetings and one-on-ones
–Identify knowledge gaps and arrange training
 Functions of Line Managers in HRM

–Coach and mentor

–Recruit, induct and settle new staff in
–Maintain and evaluate work-flow processes
–Communicate changes from senior leaders
–Communicate organizational mission, vision and values