CHAPTER 1

INTRODUCTION TO HUMAN RESOURCE MANAGEMENT

OUTCOME
• Define HRM
• Differentiate personnel management and HRM
• Function of HRM
• Factors influencing HRM
DEFINITION
• Development and implementation of
systems in an organization designed
to attract, develop and retain high-
performing workplace
• To ensure the people employed by
the organization are used efficiently
& effectively towards achieving the
organizational goals
• Employers need a flexible workplace to
survive:
• Worker who can perform multi tasks
• Worker who can be re-deployed easily
• Workers who can be relocated easily
• Workers whose service can be
terminated easily
• Workers whose terms and conditions of
service can be changed readily
• Who Is an HR Manager?
 In the course carrying out their duties, every
operating manager is, in essence, an HR
manager.
 HR specialists design processes and systems that
operating managers help implement.
Why is it Important?
• Staff are the largest revenue cost of any organisation.
• Staff are a volatile resource, they can leave you any time.
• Staff are a store of corporate knowledge and the means
of service delivery.
• Retaining and developing good staff allows you to use
skills and develop as a business.
• Individuals should contribute more than they cost.
• In the industry customer care critical and delivered by
staff as representatives.
PERSONAL QUALITIES AND SKILLS REQUIRED
Communication skills

Ability to bring about change

Information technology (IT) savvy

Numerals and able to analyse data

Ability to understand the business contract

High ethical standards

 DISTINCTION BETWEEN
PERSONNEL MANAGEMENT (PM) & HUMAN RESOURCES MANAGEMENT (HRM)

Dimension PM HRM

Perspective Short-term perspective Long-term perspective

Point of View Compliance The psychological

contract based on
commitment
Control External control Self-control

Perception Pluralist perspective A utilitarian

perspective
Role Specialist role Strategic role

Outlook Cost-minimization Maximum utilization

 DISTINCTION BETWEEN PERSONNEL MANAGEMENT &. HRM (CONT’D)

Dimension PM HRM

Employment contract Careful delineation of Aim to go beyond

written contracts contract

Rules Importance of Can do outlook,

devising clear rules impatience with rule

Guide to management Procedures Business need

action

Behavior referent Norms/customs and Values/mission

practices

Managerial task vis-à- Monitoring Nurturing

vis labour

Initiatives Piecemeal Integrated

 DISTINCTION BETWEEN PERSONNEL MANAGEMENT &. HRM (CONT’D)

Dimension PM HRM
Job design Division of labor Team work
Conflict handling Reach temporary truce Manage climate and
culture
Training and Controlled access to courses Learning organizations
development
Respect for Labor is treated as a tool People are treated as
employees which is expendable and assets to be used for the
replaceable benefit of an organization
Shared interests Interests of the organization Mutuality of interests
are uppermost
Evolution ‘Employee advocate' ‘Member of the
management team'

SOURCE
Aswathappa, K., “Human Resource and Personnel Management”, Tata McGraw-Hill Publishing Company
Limited, 3rd Edition, 2002, p. 6. and Guest, 1987, cited in Gamage & Pang, 2003, p.256.
 HRM MODEL

Current Context Organizational Strategies Organizational Culture:

(Political Climate, Gov’t and Structure: Goals, Mission and Vision,
Laws, Economy, etc.) Organizational chart Informal Procedures

Human Resource Functions

Plan for Future Recruitment and

Human Resource Selection
Needs

Training and Compensation -

Development Policies Salary, Benefits,
Bonus System

Industrial
Performance
Relations
Management

Review & Evaluation of Human

Resource Activities
Recruitment and Selection
• RECRUITMENT
• process of finding, identifying and attracting
• potential qualified applicant
• apply for job vacancies
• on the time limit
• Requires to achieve the organization’s objectives
• based on the organization's mission and the workplace culture. For example,
employers that recognize the value of workplace diversity embrace recruitment
practices designed to attract a diverse applicant pool.

•
• SELECTION
• process of choosing
• suitable applicant
• from a group for available vacancy
• information must be collected and assessed
• To fill specific jobs within the organization 12
Training and Development
• Orienting & training employees
• new-employee orientation, job skills training, leadership
training and professional development
• Designing and implementing management and
organizational development program
• improve employees' job skills in their current positions
• equip them with skills and expertise for cross-functional
work that can increase their value to the organization.
• reflect promotion-from-within practices and support
employees' work goals.
• 13
PERFORMANCE EVALUATION
• process of evaluating
• ability and performance the effectiveness of the work
done in a certain period
• a process to evaluate the effectiveness of the tasks given
• give feedback to the employee being evaluated

14
COMPENSATION MANAGEMENT
• how employers reward their employees.
• Total of all rewards provided to employee in return for
their services
• Given to employees to upgrade/ enhance their work
performance
• To attract, retain and motivate employees

15
OBJECTIVES OF HRM
Helping the organization reach it goals

Employing the skills and abilities of the workforce

effectively
Providing the organization with well trained and well
motivated employees
Communicating HRM policies to all the employees job
satisfaction and self actualization
Developing & maintaining a quality of work life

Helping to maintain ethical policies & social

responsible behaviour
Managing change
FACTORS INFLUENCING THE HR
SYSTEM
External
Environment

Technology of The Workforce

Production &
Organization of
Work FACTORS

Organization
Organization Culture
Strategy
17
 EXTERNAL ENVIRONMENT

Social: • social values, roles, trends, etc.

• political forces, changes. Ex. Bush

Political: presidency and its agenda for Social
Security.

Legal: • laws, court decisions, regulatory rules.

Economic: • product, labor, capital, factor markets.

 FACTORS INFLUENCING THE HR SYSTEM……cont
The Workforce
Demographics

Organization Culture
Weak vs. Strong culture “Type” of culture

Organization Strategy
Competencies Sustained

Technology of Production & Organization of Work

Physical
Required Ease of monitoring
layout/employee
employee skills employees’ input
proximity
FACTORS INFLUENCING HRM
• Type & strategy of organization
• Organizational growth cycle & planning
• Environmental uncertainties
• Type & quality of information
• Time horizons
• Labour market
• Outsourcing
• Cultural differences
• Compliance with data-privacy regulations
• Varying economic conditions across countries
• Time zone differences
• Legal environment
• International compliance

21
TYPE & STRATEGY OF
ORGANIZATION
Embryonic
Stage

Decline Growth
Stage Stage

Mature
Stage
ORGANIZATIONAL GROWTH
CYCLE & PLANNING

 Recruitment, selection & training

 Balancing Mechanisms
 Succession Planning
 Layoffs
 Flexi time & Job Sharing
 Retirement
ENVIRONMENTAL
UNCERTAINTIES
• Forecasting
• Well developed Job Analysis information
• HRIS
TIME HORIZONS
• Short-term Plans (6 months to 1 year)
• Long-term Plans (3 to 20 years)
• Depends on degree of uncertainty prevailing
• Greater uncertainty ↑
• Plan’s time horizon ↓
LABOUR MARKET
• Means people with skills & abilities that can be tapped as &
when the need arises
• Shortages may occur
• Considerations about labour supply
• Population
• Demand of goods & services
• Nature of production technology
• Employability of the people
OUTSOURCING
• Sub-contracting
• Mainly done of non-critical activities
• Surplus labour