K.G.MITTAL College of Arts & Commerce MALAD (West) Mumbai – 400 064.

Information System in Human Resource Project Submitted By: Mr: DEEPAK SHARMA Roll No.: 3 Under the Guidance of: Prof: Disha Vaishnav For The academic year 2011-2012 In fulfillment of the requirement for the Degree of Bachelor of Management Studies Third Year-Semester 5

Executive Summary
This project is based on Information System In HR an overview.... The belief that a person working for a firm are one of its main assets and of the decisive factors in determining its results is one that leaves little room for argument. People are not mere bricks, motor, machineries or inventories. They are humans. Organization entirely depends on humans for their success and competent environment in the global world. Human Resource Information System (HRIS), refers to the systems and processes at the intersection between human resource management (HRM) and information technology. This Project covers in depth information about the Information System in HR(Commonly known as HRIS).That is Introduction to Human Resource Management, Implementation Of Human Resource Information System, Application of Human Resource Information System, Emerging Trends and Future of HRIS. With a case study of Air India, which help us to study this topic more clearly and on which specific conclusion can be made.


I, Mr. Deepak Rajesh Sharma of K.G.MITTAL College of Arts & Commerce of T.Y.B.M.S. (Third Year Bachelor Degree of Management Studies Semester 5) hereby declare that I have completed the project on “Information System in Human Resource” in the Academic Year. The information submitted is true and original to the best of my knowledge.

Place: Mumbai Deepak .R. Sharma Date


Manager of Air India throughout the project.Mittal College would like to thank Mrs. Leena Gadkari my coordinator for their friendly guidance and constant encouragement.Acknowledgement This project was made possible. I student of K. whose names if not mentioned would be inconsiderate on my part. and good wishes of many people.John.R. by the efforts of many people who supported me in this endeavor. I’m thankful to Prof. 4 .G. The project “Information System in Human Resource” is a result of co-operation.D.Savita Sharma Assistant H.Mello for giving us an opportunity to present a creative outcome in the form of a project.Disha Vaishnav my project guide for her involvement and timely assessment which provided inspiration and her valued guidance throughout my study on this subject. I am also indebted to Principal Dr. Words fail me to express my gratitude for wide variety of interest and assistance given by Mrs. hard work.

Lastly.I would like to thank all the respondents of the team member’s questionnaire without whose co-operation my research would not be realistic. family members. I extend my thanks to my college friends. for their efforts and creativity which helped in giving final shape and structure to the project. I would also rake this opportunity to express sincere gratitude to the library staff that provided me with the right information and study material at the right time.R. I am also thankful to all seen and unseen hands and heads which helped in direct and indirect completion of the project. Place:Mumbai Deepak. Without their contribution this project would have been deficient. These acknowledgements are one way where I can thank people who have been instrumental in making the project.Sharma Date: 5 .

4. No. 6. 5. 7.Table of Contents Sr. 3. Chapter Name Introduction to Human Resource Management Implementation Of Human Resource Information System Application of Human Resource Information System Emerging Trends and Future of HRIS Case Study Conclusion Bibliography Page No 7 25 47 66 78 98 103 6 . 2. 1.

2 1. 1.4 1.3 1.Chapter 1 Introduction of Human Resource Management Evolution of Human Resource Management. Environment of Human Resource Management.5 7 . What is Human Resource Management? Status of Human Resource Management. Planning of Human Resource Information System.1 1.

motor. attitudes and behavior in the workplace go a long way to accounting for a company’s success. 8 . machineries or inventories. They are humans. This can be done by Personnel management or Human resource Management (HRM). People are not mere bricks. There is no question regarding the fact that worker’s qualities. They must be managed properly and mould effectively so that both individual and organization goals are accomplished. Organization entirely depends on humans for their success and competent environment in the global world.Chapter 1 Introduction of Human Resource Management 1.1 Evolution of HRM The belief that a person working for a firm are one of its main assets and of the decisive factors in determining its results is one that leaves little room for argument.

The impetus of the HRM change comes from recognition of recent development in the HRM profession and a realization of its importance in today’s competitive world. over which companies do not have complete capital control.HRM. HR management professionals are becoming strategic business partners in their organization. human resource managers need to rethink how to deploy and mobilize the more valuable corporate resource: human capital. a relatively new term. there do exist certain instruments to enable them to exert their influence on the quality and performance of the human capital on which they rely. While this type of resource is one. In today’s information society. emerged during the 1970s. capable of contributing to the improvement to the organization’s competitive advantage. Those in the world of human resource management are often accused of living in an ivory tower. During the 4th century BC there existed a sound base for systematic management of resource in an organization. 9 . managing the human side of their organization in ways that lacks relevance in the new information era.

imposition of standards on other functions.Achieving Professiona Regulatory 1980 sophisticati l. conformin s on impersonal g. s paternalis m. 1970. legalistic. Introductio 1960 for legalistic n of s recognition techniques . 1930 of capitalist welfare. 1940. s Productivit y through 10 Status Clerical Administrati ve Managerial Executive .Beginning Pragmatism Statutory.Struggling Technical.Promising Philosophic Human 2010 al Values. 1990.The following table will show the evolution of HRM in India: Perio Developme Outlook Emphasis d nt Status 1920.

making business transactions. 1. communicating through all forms of media and dealing with customers could not be completed. without them. (HRM) is a management functions that help managers to select. consist of all the activities undertaken by an enterprise to ensure the effective utilization of employees towards the attainment of individual. train and develop members for an organization. Humans and the potential they posses drive an organization. In other words. Organizational change impacts not only the business but also its employees. recruit. Human Resource management (HRM). also called as personnel management. time and talents must be managed. 11 . Today’s organizations are continuously changing. everyday business functions such as managing cash flow. Human resource management works to ensure that employees are able to meet the organizational goals. group and organizational goals. In order to maximize organizational effectiveness human potential-individual’s capabilities.2 What is HRM? Humans are an organizations greatest asset.people.

g. staffing and post hire. The organization must decide what type of job openings will exists in the upcoming period and determine the necessary qualifications for performing these jobs. Selecting practice include recruiting applicants. g. During the hire phase the organization selects the employees. a department manager or some event (e. assessing their qualifications. family background etc and ultimately selecting those who are deemed to be most qualified The staffing: It states maintaining of selected and existing employees.An organization’s HRM function focuses on the people side of management. including the pre-hire. It consist of practices that help the organization to deal effectively with its people during the various phases of the employment cycle. Both the job description (details of the job) and the job specification (specification required in the candidate for a particular job) are useful tools for staffing process. The pre-hire phase: It involves the planning practice. their physical fitness. 12 . an employee is leaving) within the organization usually determines a need to hire a anew employee. Someone (e.

In large organization employee requisition must be submitted to the HR department that specifies the job title. The post hire phase: In the post hire phase the organization develops HRM practice for effectively managing people once they have “come through the door”. 13 . The following three points collectively give a simplistic explanation of HRM: • HRM is a series of integrated decisions that form the employment relationship. It is the duty of human resource management to maintain the employees for a longer period of time. direct and facilitate employee’s effort towards meeting the organization objectives. These practices are designed to maximize the performance and satisfaction levels of employees by providing them with necessary knowledge and skills to perform their jobs and by creating conditions that will energize. Their functions are confined to business establishments only. their quality contributes to the ability of the organizations and the employees to achieve their objective. the department and the date the employee is needed.

health. and societal integration. 1. directing. government. recreation or what so ever it is. organizational compensation. individual. are maintenance and separation of human resource to the end that objectives accomplished.3 Status of HR Status of human resource management/ department in the total organizational structure depends on whether the unit is small or large. motivating them to higher levels of performance and ensuring that they continue to maintain their commitment to the organization which are essential in achieving organizational objectives. there is no separate department to co-ordinate the activities relating to personnel. Since every organization is made up of people. developing their skills. • HRM is the planning. there may not be any personnel managers also. 14 . In fact. organizing. acquiring their services. development. controlling of the procurement. In most of the small organizations. education.• HRM are concerned with people dimensions in management. This is true regardless the type of organization-business.

there may be centralized HR/ personnel department at the main or registered office and each plant will have separate HR/ personnel departments. Alternatively.Service of outsiders who specialist in maintaining accounts and records relating to provident fund. 15 . This typically takes place in a small scale unit. This arrangement holds well when the company has single unit. a low placed employee may be entrusted with the task of attending these functions. pension and other statutory requirements are retained for a fee. Where the company has multiple plants located in different parts of the country. His or her status will be equal to that of any executive. Chart below clearly shows HRM in small unit. Owner Manager Owner / /Manager Production Production Manager Manager Office Manager Office Manager Sales Manager Sales Manager Accountant Accountant Personnel Personnel Assistant Assistant A large scale unit will have a Manager / Director heading the Hr department.

However. and the like are handled by the central department.Routine activities relating to each plant are handled by the HR/ personnel department attached to the work.HRD and ManagerIndustrial Relations. Manger. under who are ManagerPersonnel. a typical HR department is headed by a Director. it may be stated that it depends on the scale of operations and attitude of the top management towards its personnel. This is the case with conglomerates such as L & T. matters concerning executives. BHEL etc. The department will grow in size and importance when new demands are placed on it by the top management. Manger. 16 .Administration. Chairman and Chairman and Managing Managing Director Director Director Director Production Production Director Director Finance Finance Director Director Personnel/HR Personnel/HR M M Director Director Marketing Marketing Director R & D Director R & D Coming to the composition of HR department. Chart below shows HRM in Large scale unit. whereas the board policies.

organizational culture and conflict. economic. The forces arepolitical and legal.4 Environment of HRM Environment is an important variable in the HRM model. and professional bodies. technological.Chart below shows the composition of HR. 17 . cultural. The first four together forms the external environment and the last three factors constitute the internal environment of the HR department. unions. Owner/MaOwner/Manager nager ManagerManagerPersonnel Personnel HR HR Planning Planning Grievance Grievance Handling Handling Hiring Hiring Compensa Compensa tion tion ManagerManagerAdministrati Administrati -on -on ManagerManagerHRD HRD Appraisal Appraisal ManagerManagerIR IR PR PR Canteen Canteen Training of Training of employee employee Medical Medical Welfare Welfare Transport Transport Legal Legal 1. personnel department. Environment may be understood as all those forces which have their bearing on the functioning of the HR department.

All HR activities. Thus it plays an internal factor for HRM. The same has been included here as an internal environment.Before examining its forces. A trade union may be understood as an association of workers or management formed to protect their own individual interests. 18 . it is useful to understand the utility of analyzing the environment in which HR managers have to work Analysis of the environment is useful for the HR manager and his/her team in order to become proactive and not to remain reactive to the environment. IR and separation are carried out in consultation with union leaders. selection. Proactive steps are vital for any organization if it has to survive in such an environment. This is justified because a firm’s personnel activities will be influenced by its own unions as well as the unions of the other plant. Reactive strategy serves the purpose when the environment is fairly stable and competition is less severe. compensation. training.recruitment. Internal Forces: • Unions: Unionization as an external factor was examined earlier.

means there are usually multiple paths to objectives. The success is picking the path that best fits the organizational structure. 19 .• Organizational Culture and Conflict: Every organization as mentioned has its own culture. For example. its success and its failures. This is also a striving internal force for HR management. It is the job of HR specialist to adjust proactively to the culture of the organization. • Professional bodies: Professional bodies have not been able to prescribe its accreditation as a pre-requisite for HR practitioners. This idea. In fact it has not even prescribed a minimum academic qualification for an HR professional. Organizational culture is the product of all the organizational features. Organizational culture reflects the past and shapes the future. objectives can be achieved in several acceptable ways.its people. It is now expected by an HR practitioner to declare their allegiance to the code. called equifinality.

20 . They are. The executive popularly known as the government is the law impending body. is the law making body. also called parliament at the central level and Assembly at the state level. The legislature. The plethoras of labor acts which are in force are enacted by the legislature.the legislature. Above these two is the judiciary which has the role of watchdog. there are three institutions which together constitute the total political environment. In a democratic Political setup (as opposed to a totalitarian system). the executive and the judiciary. The main function of the judiciary is to ensure that both the legislature and the executive work within the confines of the constitution and in the public interest.External Forces: • Political-Legal: The political environment covers the impact of political institutions on the HRM department. The legislature decides and the executive acts.

save lives. generate. industrial production. agriculture. suppliers. money and capital markets. introduce machines to do the work for humans. and industrial labor are the components of the economic environment. 21 . national and per capita income. and provide managers with a lot of leisure and comfort in the process. substitute mental work with computers. control birth rate. discover new materials and substitute existing ones. Growth strategy. customers. • Technological: Technology as a systematic application of organized knowledge to practical tasks. preserve and distribute energy. Science and technology enabled man to overcome distance. unravel the mysteries of the seas and the space. competitors.• Economic: Economic environment refers to all those economic forces which have a bearing on the HR function. population.

Cultural Forces: Culture refers to the complex whole which includes knowledge, belief art, morals, laws, customs and other capabilities and habits acquired by an individual as a member of a society. Culture trains people along particular lines, tending to put a personality stamp upon them. Thus, we have Indians, Japanese, Americans, British, and Germans and so on. It is not that all people are alike in particular there are sub cultures within a culture. When people with different cultural background promote, own and manage organizations, they themselves tend to acquire distinct cultures. Thus, the culture of the Tata group of companies is different from that of the enterprises owned and managed by the Birlas. The culture of these groups of companies differs from that prevailing in the new economy firms.


Planning of Human Resource Information System (HRIS) Some refer to HRMS, HRIS planning as the “pay me now,

pay me later” syndrome. The organization must do a proper study, engage a consultant to do it, or bypass the step entirely, or eventually pay a price. Sometimes management that a new HRMS will solve the organization problems.


Perhaps some managers or technicians want others to perceive them as current; perhaps the organization has periodic but difficult to define deficiency in management information reporting. The drive for a new system should come from two related bases: 1. Understanding the current business, organizational and environmental conditions that require correction or enhancement, and 2. Understanding what computer systems for human can and cannot do. In other words the purpose for planning human resource management system or information system is to enable organization to anticipate their future HRM needs and to identify practices that will help them to meet those needs. HR planning may be done on a short or long term (three or more years) basis. Its aim is to ensure that people will be available with appropriate characteristics and skills when and were the organization needs them. The user of HR planning enables companies to gain control of their future by preparing for their likely events. That is, they can anticipate change and device appropriate course of action. When companies learn how to capitalize on future events, their own future improves.


As valuable as HR planning is, many companies ignore this opportunity. Some see to it as too difficult and frustrating, while others simply do not see the need for it. However when failing to properly plan for the human resource, employers are forced to respond to events after they occur, rather than before; they become reactive; rather than proactive. When this outcome occurs, an organization may be unable to correctly anticipate an increase in its future demand for personnel. At best, such a company would be forced to recruit personnel at the last minute and may fail to find the best candidates. At worst the company may become seriously understaffed. If company remains understaffed for a prolonged period, it may ultimately suffer a variety of consequences. For instance, the under staffing could cause existing employees to experience a great deal of stress as they attempt to meet additional demand without adequate resources and assistance. If required work is not getting done, the firm ultimately may experience an increase in back orders, which could cause a decrease in customer goodwill, an increase in competition and loss of market share.


The following tabular column will show the result of improper planning of human resource which will show the decline in number of employees with an increase in the number projected sales for the coming years.000 240 200 165 215 ? Chapter 2 25 .2008.50010.8009.7007. Years Projected sales (thousands of dollars) Number of employees 2006 2007 2008 2009 2010 10.

Chapter 2 26 . Maintaining of Human Resource Information System.Implementation of Human Resource Information System 2.5 Implementation planning of HRIS.3 2.2 2.4 2. 2. Performance Appraisal in HRIS. Evolving Role of HRIS Manager.1 Role of consultant in Information System Human Resource.

In developing a prospective consultant and in evaluating consultant’s proposal. The best consultant for small manufacturing company may not be the best one for an international banking firm. areas of expertise. Project manager should consider following points: • Technical and human resource knowledge:27 . The HRMS project team should screen potential consultants concerning experience. Every organization must carry out its own process of consultant selection and not rely solely on the experiences of a competitor or an organization for which human resources staff worked in the past. rates and personal compatibility. the explosion in the number of firms and individuals offerings HRMS consulting services demonstrates not only the growth in computerized human resource applications but also the recognition that different circumstances benefit from different types of consultants. availability.Implementation of Human Resource Information System 2.1 Role of consultant in HRIS The term consultant refer to any professional who offers human resources and IS advice to client for a fee. Selecting the rich consultant depends on both quantitative and qualitative factors.

others work on all aspects of an HRIS. experience and services match the needs of this specific project. • Experience with similar projects:Some consultants offer planning services only. • Effective communication skills:The human resource staff and management should feel that the consultant hears what they say. others offer a combination of implementation services as a part of their total package. some only on human resource systems. • Independence:- 28 .An effective HRIS consultant must understand computer systems and human resource issues and practices. Some concentrate only on payroll systems. The consultant’s approach to HRIS and whether it fits the specific project must be evaluated. speaks clearly in ways they understand and communicate well with both orally and in writing with those who will be involved in the project. A firm should select a consultant whose technical expertise.

unlikely if the consultant has a relationship with vendor. In such situation. This is.An HRIS consultant must have no ties to any particular vendor. of course. the client should require that potential HRIS consultant disclose any financial or other working relationships with vendors before contacting for consultant services If the role of consultant is effectively functioned in an organization. He is considered to be the backbone of the organization and his character plays a vital role for selecting a right type of candidate. At very least. The information between the consultant and the organization should be transparent. This can occur when the consultant specializes in implementing the systems offered by particular vendor. it will have a great impact not only on the members working in it but also the employees who are on path of joining. the consultant has a vested interest in which vendor’s system a client selects. A typical flow of information between a consultant and an employee can be clearly seen in the diagram Consultant Marketing and Business Development Satisfied Client 29 . The future prospects of any organization depend upon the role of the consultant.

Modification and Negotiation. Development of Specific Proposal 2.Reporting and Project review Request for services/ Request for Proposal Proposal of services/ Deliverables Initial Personal Contact/ face-toface Meeting Contract Letter of Service / Deliverables.2 Implementation planning of HRIS 30 . Analysis of Needs/Problem Definition.

often through negotiation and compromise. as well as how such outside priorities may influence data and procedures that affect the HRMS. the HRMS project manager should give department or functional heads opportunities to explain their perspectives on how and when to integrate their functions into new HRMS. Given below are the steps involved in implementation process of Human Resource Information System.Human Resource Information System implementation planning must integrate two types of priorities: the goals of the human resource department and the primary targets of the IS (Implementation Schedule) department for system development in the future in many cases. • Implementation Schedule 31 . To establish implementation priorities. human resource can set implementation schedule only with the cooperation and participation of IS management. The HRMS project team should develop the implementation plan before finalizing any equipment or software purchases or introducing even one piece of the new HRMS. HRMS planning also must take into account restrictions on staff and technical resources availability imposed by no computer priorities.

• Staffing for Implementation During the HRMS planning and design stages. and elapsed time or duration of each implementation task or activity. the number of people involved in the new HRMS increases dramatically. the principle people involved are the human’s resource staff and project manager or consultant. Draft copies of the schedule should be sent to all HRMS project team members and management staff. Only by developing. Delivery dates and the schedule of deliverables from outside source should be double checked. in management success. end dates. Every member of the HRMS implementation team should have the opportunity to participate in the development of the schedule. The schedule should include estimated start dates.In HRMS implementation. scheduling is a critical component in planning and development and. vendor and consultant with similar projects. monitoring. and their input should be solicited before dates are finalized. ultimately. as with most projects. The team should then estimate tome requirements based on the experience of staff. and maintaining an accurate schedule can managers control costs and resource effectively. During implementation. Virtually the entire human resource staff plays some role 32 .

management responsibility of the new system shifts from the HRMS Project manager to the actual HRMS manager. The individual who has served as HRMS project manager may or may not be the best system manager. sometimes called as human resource system center (HRSC) manager. staff and user relations. • Implementation specialist: 33 .outside department such as IS and the facilities also take part. Several specialists who were not involved earlier participate as a part of implementation team. The HRMS manager supervises and assumes responsibility for the ongoing system. development and implementation may not wish to serve as administrator of a comparatively steady state system. Sometimes skilled and challenged by project planning. The project implementation plan should include benchmarks and dates for shifting responsibility from the HRMS project manager to the HRMS manager. Some of these new members and their functions are as follows: • Human Resource manager: Immediately following implementation.

management and users. This person coordinates all aspects of training team members. Responsibilities include training program design. facilities and materials. and calculates valid totals. a consultant who is an implementation specialist provides important planning. The IS auditor reviews the operations of the HRMS from a reliability standpoint to ensure that the system performs as expected. administrative and technical guidance. • Training Coordinator: Training takes place at various points during implementation. the HRMS implementation team should include at least one member of the training function. 34 . process transactions consistently. An implementation specialist may be part of the vendor’s staff or an experienced consultant. staffing.In certain situations. scheduling. • IS (Implementation Schedule) Auditor: This function is not generally part of the implementation team.

More corrective maintenance takes place relatively early in the HRIS 35 .3 Maintaining of HRIS In an HRIS. modifying system already in production or fine tuning a system so that it will run faster etc. bugs are mistakes that did not appear in system testing performed during implementation. Types of Maintenance:• Corrective maintenance refers to fixing problems that prevent the system from working the way designers and users intended to work. In the post operational state. correcting bugs in program data. development or implementation. maintenance refers primarily to software maintenance rather than hardware maintenance.2. These bugs may stem from incorrect design. maintenance refers to any changes made to the HRIS after the system becomes operational and has been accepted by users. Hardware maintenance is more straight forward and often takes place under contract with the equipment vendor or an outside maintenance organization. Software maintenance means technical changes that do not alter HRIS functions and features.

development cycle, while the system is still growing and users are learning to use it in the real world of human resource. • Adaptive maintenance refers to modifications to the HRIS in response to changes technology, government regulations or external forces such as fixes or new system releases from the vendor. Adaptive maintenance may add entirely new functions to the system or fine-tune existing capabilities and performance criteria. Examples include increasing the size of the zip code field from five to nine characters, replacing dedicated terminals with microcomputers etc. • Perfective maintenance refers to modifying the system to respond to changes and request from users and technicians. Users react to what they see in HRIS and how it works. This reaction generates idea for improvement or additional functions. Perfective maintenance includes activities such as adding a new file, adding a new screen or report, and modifying schedules for distributed printing of reports during facility expansion. In a well planned system, corrective maintenance can require a smaller proportion of maintenance resources the adaptive and


perfective work. In such situation maintenance helps the system meet an increasing number of human resource needs as the HRIS grows and matures. The maintenance budget: Effective maintenance needs effective funding. The HRIS and the human resource department must begin budgeting for maintenance by regarding the HRIS as an asset rather than a liability. Many organizations list software systems on the balance sheet as an asset and therefore should treat the HRIS as one. An organization will direct the largest proportion of its IS budget towards maintaining operational systems. Of the overall cost of building and operating a system, maintenance generally consumes over 50 percent of resources during the useful life of the HRIS. In case of HRIS, maintenance accounts for about two-third of systems cycle costs. The maintenance burden for an HRIS is potentially higher than for other systems for several reasons which states as under: • The human resource department and its system requirement are dynamic. Constant change is the rule than exception.


Government regulations often dictate a large proportion of these changes. • The traditional lack of IS resource for human resource applications leads to compromises in application design and documentation. These, compromises in turn, make maintenance more difficult. • The lack of IS support leads to a larger backlog of maintenance request for human resource applications.

As a system attains maturity, maintenance costs rise. If the department continues to use the system after it has exceeded its useful life, the resulting sharp increase in maintenance costs usually result in serious shortfalls in the HRIS budget. For instance, a company uses information system in human. This is shown in the below tabular:

Year HRIS HRIS HRIS Actual Budgetin plann Softwa Implem HRIS g for ing re entation mainten HRIS

Surplus / Shortfall

00 00 0 $ 225.0 150.ance Cost 01 02 03 04 05 06 07 08 09 10 11 $ $ 150.4 39 .000 $ 60 000 $ 1 11 000 $ 2 10 000 $ 3 35 000 $ 4 85 000 $ 6 60 000 $ 110000 0 Performance Appraisal in HRIS Maintena nce $ 1 00 000 $ 1 10 000 $ 1 21 000 $ 1 33 000 $ 1 46 000 $ 1 61 000 $ 1 77 000 $ 1 95 000 $ 60 000 $ 50 000 $ 11 000 ($ 77 000) ($ 1 89 000) ($ 324 000) ($ 483 000) ($ 905 000) 2.000 $ 40.000 $ 225.

Appraisal. appraisal system seeks to evaluate opportunity factors. The performance appraisal process in human resource information or management system takes place in the following ways: • Objective of performance appraisal: The main objective include effecting promotions and transfers. Towards this end. judgment. Assessment of employee’s performance should not be confined to past performance alone. the objectives of appraisal stretch beyond the traditional ones. In the system approach. assessing training needs. cooperation. Opportunity factors include the 40 . In the system approach. supervision. leadership abilities. awarding pay increase and the like. Potentials of the employee for future performance must be assessed. versatility health and like. quality and quantity of output. would assume systems orientation. appraisal aims at improving the performance. in future. dependability. The emphasis in all this is to correct the problems this objectives are appropriate as long as the approach in appraisal is individual. initiative. instead of merely assessing it.Performance appraisal is an assessment of an individual’s performance in a systematic way. the performance being measured against such factors as job knowledge.

• Design Appraisal Program: Designing appraisal programme poses several questions which need answers. ventilation and lightings.  Who are the raters? 41 . Normally.physical environment such as noise. and social processes such as leadership effectiveness. This includes informing the employee what is expected of him or her on the job. available resource such as human and computer assistance. Individuals should not be expected to begin the job until they understand what is expected of them. They are. • Establish Job Expectation: The second step in the appraisal process is to establish job expectation. These opportunity variables are more important than individual abilities in determining work performance. a discussion is held with his or her superior to review the major duties contained in the job description.

specifically when it is inadequate. Feedback is necessary to effect improvement in performance. performance interview has three goals:  To change behavior of employees whose performance does not meet organizational requirement or their own personal goals. Once the appraisal has been made of employees.  To maintain the behavior of employees whose perform in an adequate manner. the raters should discuss and review the performance with the rates. Specifically. so that they will receive feedback about were they stand in the eyes of superiors. 42 . What problems are encountered?  How to solve the problems?  What should be evaluated?  When to evaluate?  What methods of appraisal are to be used? • Performance Interview: Performance interview is the step in the appraisal process. and  To recognize superior performance behavior so that they will be continued.

 The opportunity to perform work assignment within an environment that not only protects but promotes physiological. also to learn grow and make full use of potential.  The opportunity to use innate and learned skills and talents in a productive manner that the individual and his or her managers and co-workers recognize as valuable. it may recollected that the most significant rewards employers offer to employee are:  Money to purchase goods and services required not only for current and future survival. These were the process were each employee would have to go for their performance to be known by the organization. The data and information generated through performance evaluation must be used by the HR department. emotional and psychological health. 43 .  Opportunities to interact with other people in a favorable working environment.• Use of Appraisal Data: The final step in the evaluation process is the use of evaluation data.  A sense of performance and stability through the continuing existence of the organization and the job. but also for the luxuries modern life has to offer.

Objectives of Performance Appraisal Establish Job Expectation Design an Appraisal Performance Interview Use of Appraisal Data 44 . Following diagram shows a simplistic table of performance appraisal approach.If the performance of the worker or employee were found to be good they were appreciated by giving monetary rewards.

developing and operating the HRIS. human resource and IS management as an integral part of the overall structure and as an asset to the entire organization. through the application as accepted human resource and IS tools and techniques.5 Evolving Role of HRIS Manager Regardless of the size or maturity of the system. • To balance the needs of users with the needs of IS and to obtain clear direction for prioritizing. the goals of the HRIS or human resource manager parallel those of the HRMS as a whole. Role of Manager in HRIS The HRIS manager handles more administrative than technical responsibilities. Sound performance as an HRIS manager rests on recognizing certain goals of the HRIS itself. Unlike the supervision of implementation. • To ensure delivery of maximum benefits from the HRIS. • To gain acceptance among corporate.2. A manager who needs computer expertise can consult 45 . at the lowest possible cost. HRIS management does not require specialized computer system knowledge. • To develop and maintain systems that support human resources and contribute to overall corporate management success.

Management must tailor procedures specifically to particular situations. Make goals clear to supervisors and staff. equipment and project prioritizing. Moreover. facilities. Briefly an effective manger needs following skills and experience. budgeting. some may not only report to separate functions or department but also hold relatively high positions in the organizations. many of the individuals whom HRIS decision affects directly do not work under the supervision of the HRIS manager. • Communication: Good communication skills are so basic to successful management that a few of particular importance to HRIS managers are included in the accompanying sidebar. Many of the most useful planning approaches and techniques for HRIS development and maintenance.with HRIS maintenance and with HRMS staff. • Organization skills: Organization skills are particularly such as important in an interdisciplinary field HRIS management. • Planning: HRIS planning includes staffing. • Goal setting: Establish a goal based on CFS’s or other well established business procedures. 46 .

This type of manger can do a very well job by consulting with human resource experts within the department. technical operations. The HRIS manager should delegate clearly making sure staff members understand the criteria for satisfactory performance. Chapter 3 47 . In large organizations. The HRIS manager should have broad knowledge of human resource but often lacks familiarity with specific. the right manager can have elegant business management skills but very little human resource knowledge and may not even come from the corporate world. Successful delegation includes accepting that the result may be different from what HRIS manager would have done.• Delegation and supervision: The first step in delegating is determining what to delegate and to whom.

3.4 48 .1 3. Requirements and benefits in HRIS.2 Payroll system in Human Resource Information System. 3.3 3.Application of Human Resource Information System Training and development in HRIS. Relationship of employee in HRIS.

insurance writing etc. employees in some firms need significant outside education. and sometimes long term career development. a broad overview of the most common training activities is presented in the material that follows. such as real estate leading. culture and approach to training and development. Training’s strategic contributions to the goal include employee orientation. The specific objectives of a training function depend on the organization’s environment. investment banking and nursing etc. such as those in electronics.Chapter 3 Application of Human Resource Information System 3. diagnosis and correction of skills problems. like compensation. has employer retention as its primary mission. Many jobs require specialized college and university degrees or certificates. • Planning for Training: 49 .1 Training and development in HRIS Training. other firms may require skills not usually covered in external educational settings. For instance. remedial training.

or on the job? • Eligibility Determination: Training must determine which individuals are eligible for or require specific training. materials and testing. formal. staff. line management or external resource. and time in position or education. • Training Administration: The training function must decide who will provide the training. job families or individuals on the basis of job classification. 50 . • Training Courses and Presentation: Training and development presents internal training.training staff. This function then manages registration. Training may take place on several levels. Staff from these functions develops course curricula. assignments and reporting of training performance results. materials.Training’s most responsibility is to determine the organization’s training needs. service. New employee orientation covers work rules company policies. Which jobs require training? What skills must this training include? Which types of training work best for each job-vestibule. venues. attendance. They may target groups.

• Skills Inventory: 51 . • Career Development Programs: Employees who appear to have promo ability and a long term future with the organization may receive special training and counseling to prepare them for future opportunities and responsibilities.benefits and possibly specific skill requirements and employer expectations. human interaction and so on. time management and responsibility of supervision. Skills training cover practical matters. Supervisory training emphasis interpersonal skills. • External Training and Education: Training monitors participation in outside course work for which the firm provides tuition. oral and writing presentation skills. operate new equipment or analyze a financial statement. material reimbursement or both. such as how to perform particular operations. Management training or management development includes decisionmaking and analytical techniques such as problem solving. Training staff pays attention to the costs and benefit of such courses. communication.

Training staff often do this in conjunction with the planning and forecasting function or the management development function. EEO and EEO and affirmative action affirmative action Other Applications Other Applications Payroll Payroll Compensation Compensation Training & & Training Development Development Benefits Benefits Health and Safety Health and Safety Human Resource Human Resource Planning Planning Health and Safety Health and Safety Employee & & Employee Industrial relations Industrial relations 52 . The assignment of this responsibility depends on whether the skills inventory focuses on recruiting. experience and goals of the organization’s employee population.Training may develop a complete registry of the skills. career development or management succession.

All except the smallest firms have sort of automated payroll because accurate payroll involves tracking so many types of tax regulations.2 Payroll system of HRIS Most business. it may list a post office box or a company mail stop) • Home address (payroll must mail tax information to the employee’s street address. payroll system preceded personnel systems as automated applications. which may differ from the employee’s residence.) 53 . Payroll needs some basic employee information. not just a post office box.3. This is due to highly quantitative nature of the work involved in payroll. payroll systems generally have a longer viable life because their purpose and structure remain fairly stable. company mail stop or bank address. Moreover. This include following: • Employee name (payroll may capture the name as the employee wants it on the paycheck) • Pay location ( address to which the pay check should be sent. for instance. even small ones have computerized the payroll function internally or use a service bureau. which is usually obtained by HRIS but may collect itself if the data fields do not correspond.

It then performs the entire set of earnings calculations for each employee in turn until it has computed all gross earnings for this pay period. Payroll also may process deferred earnings and adjust net pay accordingly. part-time or contractor) • Employee status (active. and totals these earnings as gross pay. accumulates the result of each calculation in the employee’s file. on leave or separated) To calculate actual payments. The earnings determination routine calculates each type for each employee. each earning type has a unique code. retired.• Social security number ( number provided to each employee as his/her secret code) • Employee number (if different from social security number) • Employee category (regular. payroll also imports compensation tables which include the following: • Total earnings:The payroll system. 54 . name and set of rules for calculation.

Payroll uses this pay rate information as part of the algorithm for each earning type. For nonexempt employees. information may be reported on an exemption basis. 55 . which is also known as pay basis. Some systems allow payroll to select different frequencies for different pay types or job grades. For example: employees. monthly or semimonthly). Employee relation may track this information.• Pay rate and frequency:Compensation provides data on pay frequency (such as weekly. particularly for hourly workers. or a separate timekeeping function in each line or operating unit may handle it. To eliminate data transfer problems. payroll needs data from the timekeeping function. payroll it self sometimes handles these responsibilities. biweekly. data include hours worked and types of hours. • Time and Attendance:To calculate paychecks.

the shift manager total each shift’s tips and divides them according to a set ratio. record those tips for reporting to the government. such as computerized cash register. In some situations. the sales function may receive commission related information through a point-of-sale recording device. the sales information is extracted from each employee’s file if commissions depend on department or territory sales results. 56 . each employee’s file may have code that ties it to table of sales results that payroll updates each pay cycle. the payroll system can accept sales results electronically. payroll needs information from sales. It employees pool their tips. if not this information arrives in printed form. • Tips:Some service business that employee workers who receive tips. In retail environments. such as hotels and restaurants. if the employee’s commission depends on individual sales result.• Commission:To calculate commission payments for salesperson and others.

pension administrators must provide pension participation and contribution data. Bonuses are almost always discretionary. • Deductions:There are several type of payroll deductions. provide retirement benefits. though they may relate to some other business condition. payroll does not handle the management or distribution of pensions and other retirement benefits. To hay payroll calculate these deductions.• Bonus:Management declares a bonus as a distribution of profits. The average company has 100 to 57 . such as sales. Increasingly. • Pensions:Payroll deals with pensions in two basic areas: pension distribution and pension contributions. Payroll still administers the calculation of pension contributions from employee pay. payroll may in turn. breakage rates or loan-loss ratio. After pay cycle. the most notable of which is federal income tax withholding other major types include state income tax withholding and employee contributions for benefits.

this is because employee and industrial relations play a largely reactive. Employee relations usually has little involvement in the design and development of the human resource management system. The algorithm indicates whether to base each deduction on earnings. Their actions usually result from complaints or requests from employee or their supervisors. and to include the deducted amount as taxable income. 3. though sometimes preventive role. In other words. As with earning type each type of deduction has a unique identifier. before or after taxes. employee relations seldom has its own module within the HRIS.3 Relationships in HRIS The employee and industrial relations staff in human resource information system access the HRMS frequently. Employee relations 58 . On the basis of the above functions the payroll of a particular employee is given for an effective management of human resource. The goal of employee relation in most generic sense is to provide a supportive work environment for employees. name activation cycle and algorithm arrayed in a deduction table.200 types of deductions categories.

It usually considers employees rather than management as clients but still function within established company policy. These may include performance review administration. Employee relation also has direct responsibility for sensitive issues in which personnel judgment and management decision making overlap. union relations and employee assistance programs for issues such as substance abuse. For specific individuals or positions. An employee relation representative is often a human resource generalist responsible for a specific site or work group within the organization. employee relations may have a higher profile among the general employee population than other human resource functions. For this reason. financial troubles and domestic problems. apply and work rules issues. problem involving attendance or absenteeism. 59 . Employee relations staff becomes involved in specific situations at request of individual employees. they also may interact with the employment function in resolving staffing and internal placement issues.representatives as intermediaries and guides through the complexity of employee services. These staffers strive to facilitate resolution of issues that may involve almost any human resources function. supervisors or mangers.

Like compensation. collective bargaining and so on. benefits helps an organization decide how to allocate internal financial resource. actuaries and other benefits providers and administrative services. government agencies seldom become involved in the methodology of compensation. they maintain a sharp interest in benefit. The above explanation has been illustrated in the below chart: Employee and Employee and Industrial Industrial Relations Relations Employee Employee Assistance Assistance Programs Programs Performance Performance Reviews Reviews Disciplinary Disciplinary Action Action Collective Collective Bargaining Bargaining 3.4 Requirements and benefits in HRIS The benefits function both resembles and differs from compensation. claims processors. 60 .Some other roles of employee relations include disciplinary action. Moreover. Benefit also must evaluate outside resource such as insurance carriers. Compensation and benefits are the areas of greatest human resources expense in most firms.

Each benefit has its own data requirements. paid time off. To achieve these goals. long term and short term disability insurance. • Risk benefits are various forms of insurance that help employees and their families in case of injury. • Time benefits include sick leave. HRIS designers can clarify their tasks by classifying benefits according to type: time benefit. The more closely an organization’s benefits package matches the needs and lifestyle of potential employees. accidental death and disbursement insurance and travel accident insurance. and maternity leave. relocation leave and sabbaticals. paternity leave. and every year new benefits choices emerge.As with compensation. These include health insurance. the primary role of benefit is to help attract and retain desirable employees. Workers 61 . jury duty. This is because many of these requirements depend on the type of benefit. illness or death. risk benefit and security benefit. benefits staff performs many tasks. parental leave (adoption). the greater its hiring and retention advantage. and leave without pay. vacation leave. military leave. Types of benefits: Every firm has its own list of benefits. bereavement leave. life insurance.

but the heavy fiduciary responsibilities they involve often lead management to place their administrative to separate. the human resource department tracks such loans. financially specialized functions. These above mentioned were the benefit received by an employee in an organization. • Security benefits are thrift and savings programs. credit union loans. This relates to job safety. Because of the personal nature of credit union loans or loans directly from the organization. they also include planning service such as estate planning.compensation may be considered a type of insurance and benefits may administer it. Employees often consider credit unions to be a security benefit. however the occupational health and safety function may handle its administration. 62 . income tax preparation and executive financial planning. pension plans and other retirement oriented programs. Pension and other recruitment plans are definitely security benefits.

Considering the health and safety measures provided to the employees there are five basic principles governing the safety programme in an organization. Safety programme:Safety programs deals with the prevention of accidents and with minimizing the resulting loss and damage to persons and property. Industrial safety or employer safety refers to the protection of workers health from danger of industrial accidents.” Safety in simple terms means freedom from the occurrence or risk of injury or loss. • Industrial accidents result from a multiplicity of factors. inadequate attention to the design of safety into the system. which are usually faults in the management system arising from poor leadership from the top. a systematic approach to the 63 . a person or a radiation results in personal injury. An accident then is an unplanned and uncontrolled event in which an action or reaction of an object. a substance.Health and safety “Every twenty seconds of every working minute of every hour through out the world. someone dies as a result of an industrial accident. But these have to be traced to their root cause.

Methods of ensuring that safety equipment is maintained and used and 5. analysis and elimination of hazards and poor training facilities. This is possible only if there are: 1. • The safety policies of the organization should be determined by the top management and it should be continuously involved in monitoring safety performance and in ensuring that a corrective action is taken when necessary. supervisors and workers to pay more attention to safety 64 . inspections and investigations. Systematic procedures for carrying out safety checks. 3. Adequate accident records and statistics. means available for persuading mangers. 2.identification. Proper matters. provide effective safety facilities and equipment and to take prompt remedial action. 4. Comprehensive and effective systems for reporting all accidents causing damage or injury. • The most important function of safety programmes is to identify potential hazards.

• All employees should be given thorough training in safe methods of work and they should receive continuing education and guidance on eliminating safety hazards and prevention of accidents. A safety programme generally contains six elements which are depicted in the below diagram: Strategic Choices Development of Safety Policy Evaluation of Effectivenes s Organization for Safety Implementati on of Programme Analysis for causes for Accident 65 .• The management and the supervision must be made fully accountable for safety and health performance in the working areas they control.

development of safety policy. 4.3 66 .2 4. Chapter4 Emerging trends and Future of HRIS Co-evolution of Human Resource Information System Rising trends of HRIS.1 4. Prospect of HRIS. implementation on of programme and evaluation of effectiveness are the safety programmes which revolve around each other for the betterment of employees as shown above. analysis of cause for accident.Strategic choices. organization for safety.

HRIS is also coevolving. each change in response to evolution in order to allow their mutually dependent relationship to continue. thus.1 Co-evolution of HRIS Co evolution generally refers to the process of nature in which two species evolve together.Chapter 4 Emerging trends and Future of HRIS 4. In response to pressing business issues and increased competitiveness. human resource functions are 67 . This evolution of human resource is changing the Human Resource Information System this is explained further: Regulatory and operational changes within human resource inevitably lead to changes in HRIS.

they begin searching for more powerful applications in their areas of expertise. increases the data management and computational capabilities that sophisticated software must have. With the rise in two-income families and changing demographics. HRIS packages must be able to perform complicated calculations relative to benefits administration. This trend in flexibility will continue and inevitably spread to other areas of human resource. and personal leave and vacation policies. Some need life insurance. Many younger employees value time off more than they do security oriented benefits. The resulting employee enthusiasm for flexible benefits has driven the development of more sophisticated benefits administration software. older workers want flexible pension plans. more companies are extending flextime. The increasing sophistication of HRIS users have both driven human resources programs and allowed them to mature. to keep valuable workers. employees have more diverse benefit needs. Some need health insurance for their dependents. Most human 68 . Once users have sampled simple systems. For instance. This. For instance. those with no dependents will prefer more vacation time instead. human resource time and attendance systems must become more flexible and responsive yet remain friendly to typical user. In response. tele-commuting. while others have coverage through a spouse.becoming more complex. in turn. job sharing. conversely.

For this reason. information technology in the broadest sense is an even more rapidly evolving field.4 Rising trends of HRIS Though.professionals began their careers without computer experience or training. management has worked to include HRIS staff as full partners in the human resource department. 4. In some cases these separations of knowledge has caused conflict and have produced poor results. many have bought in specialist with less human resources experience but more computer-related skills. most of the significant development in HRMS stem from hardware and software improvements rather than changes in human resource itself. In other cases. Thus in future the impact of HRIS will be more towards employees. Many have had to learn on the job. operation systems and tele-communications have evolved so quickly in recent years that application software developer and users are usually working well below the capacity of the available 69 . To take full advantage of human resources automation. changes in human resource programs and functionality have driven HRIS development. Computers. with productive results. data base management systems (DBMS).

office automation support. Business expert can increase increasingly faster communication. numerous suppliers are working on faster processors. they will catalyze new application and more thorough integration of micro computers into business operations. including the following: • Increased role of Micro computers and Executive Workstations: The micro computers explosion has been perhaps the most important business phenomenon on past decade. more sophisticated report generators. A human resource department that begins computerizations with a single micro computer and printer may find itself five years from now with an entire network of computers. This process has involved an ongoing series of major advances. with each change making the pervious one relatively obsolete.technologies. HRMS developers have begun to adopt many innovations in technology and process. As these developments become commercially available within the next few years. complete with distributed processing. telecommunications and remote printing. The industry remains heavily committed to even further advances for instance. and flexible 70 . improvements in workstation technology. Data Based Management System (DBMS) and connectivity.

Experts refer to these systems by several different names. production. maintenance etc. • System connectivity: More and more human resource department have found that linking microcomputers to mainframe and midrange computers give them the best of both worlds. • Executive Information systems: Some firms have expanded the executive workstations concept even further. 71 . the most popular of these are Executive Information System (EIS) and Decision Support System (DIS). This platform combines the speed and power of the mainframe and midrange system with the responsive input /output capability and independence of the microcomputer.location arrangements to accommodate telecommuters and multisided operations. as well as internal system analysts. have begun integrating powerful but disparate elements of computer technology into systems that allow executives to take advantage to special purpose computer applications within their organizations. users typically have the central computer handle storage. Hardware and software vendors. In a linked or connected system.

they will probably become more comfortable with training via computer assisted technologies such as CBT. In business more and more training departments are working with internal human resources staff and departmental management throughout the enterprise to develop. Numerous organizations have adopted some form of CBT but wide spread acceptance awaits a sociological evolution and more cost effective techniques. educational and personal lives. As employees gain more exposure to computers in their professional. Employees also can use CBT to learn about numerous other operations via computer tutorials or programmed instructions. Typically these operations involve the computer such as words processing. Users have become more accustomed to computer training in the form of vendor supplied tutorials but still prefer and are more comfortable with human interaction and conventional classroom instructions. claims processing and book keeping procedures. CBT major disadvantage is the absence of the human monitor to answer questions and help users over rough spots. record maintenance.• Development in Computer based Training (CBT): Computer Based Training was described as a tool for training human resource staff how to use the HRIS. 72 . implement administer and evaluate CBT. This may reduce the users confident and comfort level.

• Using Present Capabilities Fully: Numerous developments that experts consider emerging trends in HRMS are already possible with current technology. compensation and management development strategies. Every HRMS consultant has opinions about which predictions are more likely to become widespread and which will remain novelties. For instance. laws and technology reviews but also on competitors. By understanding other firms practice. Sophisticated use of public and subscription data bases can provide information not only on new regulations. few take advantage of linkages for information on relevant labor markets. they may become more interested in reaching outside the organization for electronic information. The 73 . As users become more comfortable with electronic data transmission internally. They await managers that have enough expertise and resource to make full use of the capabilities present in the technology already available. unaffordable or too sophisticated for most users. the human resource department can build more effective recruitment. many human resource departments already have the hardware and software to link to external data bases.

They will want portable accounting systems. As in the past. industry standards and employment markets. they will demand more responsiveness from human resource systems. and customized career development plans.HRIS manager should not aim to develop a system that includes all of these emerging features but should consider the usefulness and applicability of potential features when planning. developing of modifying a system. Human resource mangers should work with computer professionals and trainers both in the HRSC and IS to increase HRMS user literacy.5 Prospects of HRIS Achievement of all the above mentioned promises does not preclude developing another HRIS wish list. not only because of technical and financial limitations or the reticence of HRIS developers but also because of the constant evolution of the field of human resource. individual and group pay-for –performance plans. more flexibility in benefit packages. 4. HRIS software developers will strive to offer enhancements that reflect relevant changes in regulations. As employees became more aware of the advantages and potential of the computers. human resource information Kiosks. 74 . Some needs will remain.

Human Resource users are welcoming increased access to windows. With multiple screens.Software in these areas must become more sophisticated without becoming too complicated for the HRMS end user. This 75 . An organization might consider holding on to outdated or outgrown technology for months or years longer than practical and not take advantage of new modules while awaiting further advances. human resource users can compare present and past data. Many expect that human resources software packages will increasingly support the point-and-click approach to transaction processing and information retrieval made possible by the mouse. The HRSC should make a special effort to keep up with recent enhancements and how others have applied them as well as with forthcoming innovations. Human resource will also benefit as future software provides more on-line help instead of relying on reference to manuals. view multiple tables simultaneously. compare records. Human resource professionals should investigate trends before making any software or hardware acquisitions. that allows users to view several screens simultaneously. and transfer data from one segment of HRMS to another with increased accuracy. get on-line help while containing to view the open file. HRIS managers can look forward to numerous hardware and software enhancements that aid user accessibility. Mouse utilization may then augment more sophisticated screens and menus.

caveat emptor. In part this is an effective tactic for judging market acceptance. Participants must strive for best possible system success is the motivation of users. 76 .analysis paralysis only execrates the problem. technological considerations are often the least of their worries. They can always find newer and better tools and techniques. technicians and mangers to work together to maximize the systems effectiveness. Whether a human resource department builds a system or buys one. no mater when the project proceeds. Hardware and software vendors invariably announce the availability of new function and features or the support of new technologies well before they release them. As we have employed elsewhere. Vendors also use this tactic to demonstrate that they are ahead of their peers in terms of functional and technological enhancement.

From those observations they must predict the enhancement and innovations that will evolve to meet those needs. 77 . Alternatively. they may look at pending and potential developments in computer systems and human resources. they may `consider the needs an HRMS should meet.More Responsive to Management Needs Responsive to HR Needs Improved Response Time Information Data Collection & Input Control Future HRMS Expand ed Storage Report Flexibility Rapid Design Response Improved Forms Planners can use two related methods to build an image of future Human Resource Information System/Management System. First.

replacing the largely obsolete but still ubiquitous term personal The Second component. it contains three component parts.Conclusion The term Human Resource Management System (HRMS) or Information System in Human Resource has been used many times throughout the project. This term has evolved to describe employee or human relations. The resource may be 78 . this term refers to the control of aspects of an environment with the objective of sustaining or increasing the viability of an enterprise or environment. We point out that this term is more than merely an acronym for a computer application. is intriguing. Human Resource. resource information. General speaking. each of which provides valuable perspective in the responsibilities and opportunities offered by the combination of computers and human resource information. The First Component. These parts areHuman Resource Resource Information Information System. refers to the function to which the system applied. Give Information System in Human Resource a whole new meaning.

paying. Resource management encompasses the managing of the people. or abstract. 79 . In contrast management system takes into account not only the hardware. however. water and ground resources. It involves planning for the proper use of the potential of the employee. policies and procedures that drive the modern HRMS. People have always been able to relate to the managing of our autos. facilities and other tactical resource of the enterprise. homes and machines. includes more complex process than earlier administrative operations permitted. It includes the hiring. it broadens our focuses to include the management process. Today. everyone can relate to concerns about managing our air. training. training. but actually it means more than that. firing. For instance. The Third component. data and outputs but also the staffing. could refer simply to the automation of the human resource function.natural or manufactured. welfare and nurturing of employees. software. financial. The term information system focuses primarily on the computer and its surrounding technology. In a nutshell. The management of human resources. contemporary resources management for the human resource function involves proactive planning for the organization’s needs and goals. information systems.

maintaining. strategic management and integration of the organization's human resources and information technology. retrieving. or specifically the gaps between job requirements and employee’s abilities to utilize HRIS technologies. Unlike the mainframe era. Achieving this strategic coordination requires those responsible for developing.Thus a human resource information system (HRIS) is a systematic procedure for collecting. corporate success will increasingly depend on the coordinated. was sited as the main reason 80 . operating. implementing. for the vast majority of organizations. and maintaining an HRIS to have a broad knowledge of the organization's human resource programs. and validating data needed by an organization about its human resources (HR). storing. personnel activities. HR professionals today are more comfortable using computers for HR functions. The goal of this research is to discover to what degree HRIS techniques and concepts are being taught to all employees in the organization at various levels. and organization unit characteristics. a shift resulting from increasingly user friendly applications training on HRIS. the relationship between human resource programs and overall strategic planning. While in 1999 it pointed out that an HRIS (also known as a human resource management system or HRMS) can be as informal as the payroll records and time cards of a small business. and the potential inherent in computer and data technology.

only 40 % of public sector and 30% of private sector organizations offer training on a regular basis. The best place to start an information system in human resource. if not all.that technology is underutilized for HR functions. When HRMS technology can not be integrated into existing HR courses. the other alternative is to introduce HRIS technologies through a dedicated HRIS course. would be through the two general purposes of such systems: to eliminate costs and reduce processing time and to 81 . This method would reduce constraints on faculty skills and investment in technology at a level to support all HR majors at a given institution. then. In addition study found out that private and non profit organizations integrate software and human resource management functions in low numbers. at least from a basic definitional perspective. Not surprisingly the issue that while a high percentage of private and non profit organization offer computer training (95 % public sector and 82 % private sector). Ideally. In other words. employees entering an HRIS should understand most. The general consensus on HRIS skills is that they would ideally include a working knowledge of information systems (IS) and of all HR functions and skills in process improvement and project management. of the HR functions. employees will be aware of the "functional issues" of HR and how to apply technology to them.

By adopting this board view of resources management. If a given HRIS is to have any value at all to HR then information should be based on two factors: how many decisions will be improved by the HRIS and how much value will each improved decision produce. As pointed out. planners. Understanding these two factors is tantamount to any HRIS course.support decisions with computer applications. 82 . the focus for HR professionals is to use an HRIS to make better HR decisions. decision makers and other professionals can see information resource such as HRIS as tools for handling the present and preparing the for the future. A human resource department that believes in Human resource Information System can optimize its firm’s investment in employees.

regular commercial service was restored in India and Tata Airlines became a public limited company on 29 July 1946 under the name Air India. At Mumbai. flying a Humber bi-plane. took over from J. This marked the airline's first long-haul international flight. began on October 15. Karachi. carried mail from Allahabad to Naini Junction. Tata.D. 49% of the airline was acquired by the Government of India.R. soon followed by service in 1950 to Nairobi via Aden. On 8 June 1948. Following the end of World War II. 83 .D. 1932. after the independence of India. In 1948.R. light single-engined de Havilland Puss Moth on his flight to Mumbai (then known as Bombay) via Ahmedabad. some six miles away. He landed with his precious load of mail on a grass strip at Juhu. with an option to purchase an additional 2%. the father of Civil Aviation in India and founder of Air India. a former RAF pilot who had come to India from Britain three years earlier on a barn-storming tour. It was on this day that J. the Government of India exercised its option to purchase a majority stake in the carrier and Air India International Limited was born as one of the fruits of the Air Corporations Act that nationalised the air transportation industry. took off from Drigh Road Airport. the scheduled services in India.Best Practice at Air India History Air India is India's national flag carrier. Neville Vintcent. in the real sense. 1911 when Henri Piquet. a Lockheed Constellation L-749A named Malabar Princess(registered VTCQP) took off from Bombay bound for London via Cairo and Geneva. On 25 August 1953. Although air transport was born in India on February 18. in a tiny.Tata and flew the Puss Moth to Chennai (then Madras) via Bellary.Case Study Human Resource Management . the airline was granted status to operate international services from India as the designated flag carrier under the name Air India International. during which he had surveyed a number of possible air routes. In return.

A friend who reaches out with warmth and hospitality. Simply because he is the Maharajah! He has completed 56 years and become the most recognizable mascot the world over. a monk. symbolizing graciousness and high living. he can get away with it all. His antics. Introduction Air India is India's finest flying Ambassador. And somewhere along the line his creators gave him a distinctive personality: his outsized moustache. is quintessential even today . the striped turban and his aquiline nose. the Maharajah with his inimitable style. The re-branding exercise is currently underway and passengers are 84 . He may look like royalty. This now familiar lovable figure first made his appearance in Air India way back in 1946. Mumbai. 1932.' These are the words of Bobby Kooka. which characterized Air India's first flight. a Red Indian.. In fact he has won numerous national and international awards for Air India for humour and originality in publicity. but he isn't royal.Walter Thompson Ltd. In fact. And most importantly. But the millions of travellers whose lives he has touched far outnumber them. has helped the airline to emerge as a major force in the airline industry. Today. the man who conceived the Maharajah. He's almost like a friend to every Air India traveller.Its Mascot. The merger of Air India and Indian. even to the farthest corners of the world. But his blood isn't blue. this naughty diminutive Maharajah of Air India has become a world figure.thanks to Air Indians who have kept alive the tradition of flying high. to them. a pavement artist. charm and wit is a very real person. together created the Maharajah. he too has had his critics. And as with all great men. a sumo wrestler in Tokyo.Maharajah We call him a Maharajah for want of a better description. way back on October 15. his puns have allowed Air India to promote its services with a unique panache and an unmatched sense of subtle humour. the country’s leader in the domestic sector. an artist with J. his expressions.. He can be a lover boy in Paris. he can effortlessly flirt with the beauties of the world. when Bobby Kooka as Air India's Commercial Director and Umesh Rao. The urge to excel and the enthusiasm. What began as an attempt as a design for an inflight memo pad grew to take Air India's sales and promotional messages to millions of travellers across the world.. The Maharajah began merely as a rich Indian potentate.

• Promotes the use of transit • Access to instant pricing with real time reservation. Naturally. It has the highest revenue to cost ratio in the sector (83. • Need to increase the size of parking lots 85 . • Creates new economic opportunities • Builds communities by linking them together economically • Reduces consumption of oil • Increases Productivity • The rising fuel cost (though reversed somehow by the recent recession) makes driving in and out the metropolitan area much more expensive than riding train or bus. especially during these times of Global awareness.6%) and generates significant sundry revenue which covers 4. creating a convenient. • Go Train is the healthiest public transportation system in Canada.8% of the operating cost. • Has a history of timing issues. trouble-free booking process. An international hub at Dubai International Airport is currently being planned SWOT Analysis Strengths: • The ability to travel comfortable for long distance travel • Has large capacity to transport large amounts of people in short time • Low cost of usage • Fast during peak hours • Already has a vast number of loyal passengers • Environmentally friendly. Weaknesses • High initial investment for building new rail system • Buses and trains do not run 24hrs compared to municipal transit such as TTC • Cost of Go Transit fares is much higher than those of other public transit due to the expenses to make their consumers comfortable.getting to see the unified face of the new invigorated Air India. • No need to waste precious vacation time waiting on line at the station to get your ticket. Fast booking experience • The ongoing recession puts direct financial constraints or at least concern on many people. trains do not run on schedule most of the time. riding intercity train or bus is an economic way to commute or travel individually. Air India has two major domestic hubs at Indira Gandhi International Airport and Chhatrapati Shivaji International Airport.

The current conservative federal government is not in favor of giving funding to Go Transit. Will need to build new transportation infrastructure The changes of accountability have added difficulties in continuously improving the infrastructure and operations of Go transit. Expenditure on access to railways and railway crews is the largest portion of Go Train’s operating expense.• • • • • • • • • • • • Slow in some areas during severe weather Limited to certain areas Noise may be a concern Creates a load on the electricity grid Will need a expansion of electricity production Limited competition in the bidding process for buying trains. (US and Quebec) • Internet friendly bookings and access on trains • Received funding from the federal and provincial government to help boost the economy. Especially. in order to work effectively high speed rail must be backed up by a decent urban/light rail transit system Opportunities • Ability to expand to other markets surrounding Ontario. Threats • Government may not fund the train 86 . The continuous budget deficit of the provincial government and many of the municipal governments makes the funding for Go Transit quite difficult. any long-term improvement or expansion plans are quite questionable under the deficit condition. making them cost more Go Train’s existing operations heavily rely on the railway systems owned by Canadian National and Canadian Pacific. which is a commitment made by form liberal federal government. this will create new opportunities for jobs • Loyal consumers are likely to try new services offered by Go Transit commuters are willing to pay for faster services • No other service can compete with high speed train in terms of speed and efficiency • Advertising on board will increase revenue • Gas prices rise causing a increase of customers • The Greater Toronto Area is in need of a transit link between cities • Massive increase in Jobs for local manufactures • Private-Public partnership to establish more efficiency in timing and customer service • The large population and high population density can become an excellent market for intensive intercity transit system.

TTG Mice and TTG-BT Mice China. making it cheaper for commuters to drive People may appose the building of rail lines near their home Weather Condition of Canada may effect the speeds and quality of service Noise Pollution may concern people Airlines tightening up procedures to get people through airports faster and will encourage airports to have better city links Existing transit operators might introduce an upgrade in their services and take customer away from us Inflation will increase costs.• • • • • • • • • • . Noida. all renowned Mice and business travel publications. which are passed on to commuters Union operated trains have risks of strikes Local transit operators will get priority over funding compared to GO transit Massive Construction required to build railway. Air India had won four other prestigious awards in 2006: 1) Dun and Bradstreet (D&B) which ranked the airline as the first in terms of revenue out of the top airline companies out of India. Uttar Pradesh to honour Corporates with distinct vision.” Air India was also conferred the prestigious Amity Corporate Excellence Award instituted by the Amity International Business School. 2) Reader’s Digest Trusted Brand Award. Gas prices drop. This is for the fifth year that the airline has won the top honour. It also won the Special category Award which recognizes the Most significant corporate Social Responsibility initiative (CSR) taken by an organization. TTG China. innovation. Air India has won the Galileo Express Travel World Award 2008 for the Best ShortHaul International Airline. 87 . my damage countryside environment Achievements Of Air India Air India was also ranked as the Most Trusted Brand in the aviation sector in the country in the Economic Times Brand Equity Survey 2010. competitiveness and sustenance. Air India has previously been a recipient of the Galileo Express TravelWorld Award for the “Best International West Bound Airline out of India” for three successive years as well as for launching the “Best Corporate Social Responsibility Initiative. and ‘Best South Asian Airline’ award by readers of TTG Asia. 3) CNBC Awaaz Consumer Award 2006.

for example gulf regions are still not open for Jet Airways but AI has a monopoly there. 2006) • AI is the national flag carrier of India. (Tourism India. 2007) • Air India’s has new subsidiary AI Express being the country’s only international low cost carrier which also operates in domestic market. (Ministry of civil aviation reports. 2003). This feature really differentiates it from other industry players. (Tourism India. It has brand name which is represented by its mascot called Maharajah which impersonates India and its culture. This strategy of AI can be called as focused cost leadership as they are marketing middle class passengers who want to travel internationally at a low cost. It really makes it a well known brand.AI is differentiated as it offers expanded network. AI comes under differentiation and focused cost leadership due to the following reasons: • AI along with jet airways has the monopoly in Indian international market as they are the only ones who fly international routes.Organizational strategies Porter generic strategies According to Porter (1980) generic strategies (Lynch. creates trust in the minds of its customers due to its long operation and its service to its customers. • AI last point of differentiation is it being the oldest airline as per the year 2006 it’s seventy four years old. 2007) 88 .

Ansoff Matrix Market Penetration • Companion free scheme. • Auction through IndiaTimes. This program is spread across 19 countries. • Aircraft Cabin Up gradation.USA/Canada/UK/Europe. Market Extension 89 .To promoting high yield traffic. AI has re-launched this scheme between India. this scheme has also been used for some domestic sectors as well. • Student fares.Passengers on student visa can avail special discounted fares for travel like from India to many destinations for travel.The up gradation of its old carrier like A310-300 by painting.AI auctioned seats of economy class through indiatimes. Various benefits and privileges are provided to the members.The flying returns is a frequent flyer program.com a leading internet portal. seat refurbishment and upgrading entertainment system to solid state digital audio system which provides improved sound quality and other features. oldest airline and its monopoly in Indian international market and AI can be also called focused differentiation as it majorly focuses on international travel market instead of domestic.Bowman’s Strategy clock According to Bowman’s Clock AI lies between 4th point which is Differentiation and 5th point which is focused Differentiation as already seen above in porter’s strategies it has many differentiated aspects like being a national carrier. it is designed to recognize and reward frequent flyers. • Flying Returns Program. This scheme is valid on IATA published fares in all classes for both one way and round trip.com. Students can also avail discounts on excess baggage.

New Product Development • The Maharajah Club (TMC) and The Leading Edge Club (LEC) . AI is working on it and according to project it will also invest in E-Marketing. • SMS Alert in case of Rescheduling of Flights. • E-Marketing.A special scheme is their for passengers travelling frequently to south east Asia by offering them substantial saving on bulk purchase of tickets for travel.• Medical Tourism. • ATC Mode-S Elementary Surveillance and Enhanced Surveillance FunctionalityAI on installing these to ground station. Membership to both the clubs is by invitation only with certain criteria laid down. • Wi-Fi Internet Access. • Wholesale Travel Discounts.As Iata wants to discontinue conventional paper ticketing.TMC and LEC are two elite clubs of air India.Arrangements have been made to generate SMS messages automatically to all Indian mobile numbers indicated in PNRs to alert passengers in case of rescheduling of flights. which will enhance better control of aircraft navigation.AI has tied up with M/s Vedic India to tap growing medical tourism market. 90 . Medical packages including airfares are offered to all those who are willing to undergo treatment in India. Members enjoy exclusive value added benefits and of value added partnership alliances.In the mumbai maharaja lounge and the transit lounge wifi internet access is provided along with network printing facility.

The number of flights per day operated by AI in international routes is 64 which is the highest among its competitors and domestic is 30 per day which is relatively low. However in the present scenario on comparisons with its full service players like jet. ( Growth Methods/ Operations . 91 . low fare and no frill carrier.The fleet size of AI in 2001-02 was 29 which have grown up to 30 in 2005-06 which shows growth from previous years and AI has future plans to expand their fleet size drastically. • AI besides AI Express has more fully owned subsidiaries which offer other services such as Hotel Corporation of India.Diversification • AI Express of AI is for new market that is the middle class who wants to travel internationally and is definitely a new product as it is a low cost. the fleet size is less. AI Air Transport Services Limited and AI Engineering Service Ltd.

62 lakh.However we can also see the growth in the passenger traffic and passenger load factor on all routes and services over past five years which has gone up to 43. The destinations which AI flies have increased from 32 to 46 presently. 92 .

they ask for commissions from passengers which are not acceptable at all. According to Startrax rating ( www. The numbers of employees per aircraft in AI are 418 which are way too high as compared to others industry players. (IndiaToday.airlinequality. non consistent.com) the staff is really unprofessional and even blogs state that staffs are rude.Human Resource AI needs to reconsider at its HR policies. 2000) 93 . poor check in etc. Since it’s a government organization staff is too laid back not being afraid of losing their jobs.

94 .

government job facilities and other reasons clearly mentioned in appendices 5.8. This position is because of staff having security of job in AI. 2006) The attrition among pilots and cabin crew is as high as 46 per cent. with a balance scorecard having all the aspects rated.In the second chart distribution of personnel of AI and Jet Airways is clearly shown. (DGCA. Indian Airlines HR Problems FLYING LOW Indian Airlines (IA) – the name of India’s national carrier conjured up an image of a monopoly gone berserk with the absolute power it had over the market.7. it can be clearly analyzed from the chart that expenses per employee are more than revenue which is really a bad situation. AI according to naukrihub survey of aviation sector’s best employers has ranked it at second position after Jet airways. salaries in line with the industry. On having a look at the revenues and expenses of AI staff. But if seen over the last ten years in appendix 7 there’s growth. In employees view. Moreover. details in appendix 5. Continual 95 . it can be seen that AI staff is more in comparison in almost all the departments even though Jet Airways fleet size is higher.9. maximum attrition is observed in employees in age group of 26 to 30 years with experience of two to four years.

30 Airbus A320s. a low-capacity and short-haul domestic airline with huge long-term liabilities. In 1999. the Air Corporation Act was repealed and air transport was thrown open to private players. Oman. Its international network covered Kuwait. the Government took various steps to turn around IA and initiated talks for its disinvestment. Sri Lanka and Maldives in the South Asian subcontinent. The recruitment and creation of posts in IA was done without proper scientific analysis of the manpower requirements of the organization. BACKGROUND NOTE IA was formed in May 1953 with the nationalization of the airlines industry through the Air Corporations Act. Between themselves. IA’s employee unions were rather infamous for resorting to industrial action on the slightest pretext and their armtwisting tactics to get their demands accepted by the management. Myanmar. was merged with IA.losses over the years. Amidst strong opposition by the employees. IA and Alliance Air carried over 7. the company had a fleet strength of 55 aircraft .5 million passengers annually. provided domestic air services. 11 Boeing B737s and 3 Dorniers D0228. Indian Airlines Corporation and Air India International were established and the assets of the then existing nine airline companies were transferred to these two entities. Bangladesh. Vayudoot. could spell doom even for a Rs 40 bn monopoly. especially in the human resources area. Thailand. 16 abroad). The IA story shows how poor management. Widespread media coverage regarding the frequent strikes by IA pilots not only reflected the adamant attitude of the pilots. Nepal. Singapore and Malaysia in South East Asia. covering 75 destinations (59 within India.11 Airbus A300s. IA and its subsidiary. In 1990. IA’s recurring human resource problems were attributed to its lack of proper manpower planning and underutilization of existing manpower. frequent human resource problems and gross mismanagement were just some of the few problems plagued the company. During the 1990s. UAE. but also resulted in increased public resentment towards the airline. the disinvestment plans dragged on endlessly well into mid 2001. While Air India provided international air services. Qatar and Bahrain in West Asia. In 1994. and Pakistan. Many big corporate houses entered the fray and IA saw a mass 96 . Alliance Air. IA’s network ranged from Kuwait in the west to Singapore in the east.

“Manpower planning in any organization should depend on the periodic and realistic assessment of the manpower needs. private players such as East West.” ‘FIGHTER’ PILOTS? IA’s eight unions were notorious for their defiant attitude and their use of unscrupulous methods to force the management to agree to all their demands. In the next few years. go-slow agitations and wage negotiations were common. heavy interest outflows of Rs 1. younger.5 bn. To counter increasing competition IA launched a new image building advertisement campaign. optimum utilization of the recruited personnel and abolition of surplus and redundant posts. need-based recruitment. 97 . In 1999. NEPC. IA could not sustain these improvements. It also launched several other new aircraft.99 bn further increased the losses.05 bn in 1999 as against long term loans of Rs 28 bn. while IA’s market share was 47%.9 bn during 1994-98. IA was found grossly deficient in all these aspects. IA had to operate flights in the North-East at highly subsidized fares to fulfill its social objectives of connecting these regions with the rest of the country. By 1999 the losses touched Rs 7. IA’s market share. Staff cost increased by an alarming Rs 5. As the carrier’s balance sheet was heavily skewed towards debt with an equity base of Rs 1. These costs were responsible to a great extent for the company’s frequent losses. These initiatives were soon rewarded in form of 17% increase in passenger revenues during the year 1994. Identification of the qualifications appropriate to all the posts is a basic requirement of efficient human resource management. and Damania had to close shop due to huge losses.exodus of its pilots to private airlines. Unnecessary interference by the Ministry of Civil Aviation was a major cause of concern for IA. the share of private airlines reached 53%. A report by the Comptroller and Auditor General of India stated. with a new. These flights contributed to the IA’s losses over the years. Strikes. IA could blame many of its problems on competitive pressures or political interference. but it could not deny responsibility for its human resource problems. Jet was the only player that was able to sustain itself. However. It also improved its services by strictly adhering to flight schedules and providing better in-flight and ground services. however continued to drop. and more dynamic in flight crew. Competitors like Sahara and Jet Airways (Jet) provided better services and network. Unable to match the performance of these airlines IA faced severe criticism for its inefficiency and excessive expenditure human resources. This interference ranged from deciding on the crew’s quality to major technical decisions in which the Ministry did not even have the necessary expertise.

Russy Mody (Mody). The pilots began the agitation demanding higher allowances for flying in international sectors. In 1994. When Probir Sen (Sen) took over as chairman and managing director. the IA unions opposed the re-employment of pilots who had left IA to join private carriers and the employment of superannuated fliers on contract. However. During December 1992-January 1993. found that most of these were false claims. April 2000 saw another go-slow agitation by IA’s aircraft engineers who were demanding pay revision and a change in the career progression pattern[1]. The strategies adopted by IA to overcome these problems were severely criticized by analysts over the years. free meals and wage parity with Alliance Air. Mody also proposed to increase the age of retirement from 58 to 60 to control the exodus of pilots. This was strongly opposed by the board of directors.For each strike there was a different reason. fixed flying hours. who were sent to check these pilots. in view of the mounting losses. he bought the pilot emoluments on par with emoluments other airlines. Some of the pilots were completely fit. there were 13 agitations by different unions. Due to adamant behaviour of pilots many of the cabin crew and the airhostesses had to be off-loaded at the last moment from aircrafts. made efforts to appease the unions by proposing to bring their salaries on par with those of Air India employees. The cavalier attitude of the IA pilots was particularly evident in the agitation in April 1995. there was another agitation. From November 1989 to June 1992. saying that the cabin crew earned higher wages than them and that they would not fly until this issue was addressed. thereby successfully controlling the exodus. Though the strike was called off within a week. 98 . In 1996. there was another strike by the pilots. government rejected Mody’s plans[2]. this time asking for increased foreign allowances. others somehow managed to produce medical certificates to corroborate their claims. This demand was turned down. there was a 46-day strike by the pilots and yet another one in November 1994. Analysts noted that the people heading the airline were more interested in making peace with the unions than looking at the company’s long-term benefits. They then refused to fly with people re-employed on a contract basis. In January 1997. Thereafter they went on a strike. with many pilots reporting sick at the same time. who joined IA as chairman in November 1994. it again raised questions regarding IA’s vulnerability. Medical examiners. but every strike it was about pressurizing IA for more money.

44 1/10/1998 8. Eventually. There were also reports that flights leaving 30 . IA also managed to cut losses during 1996-97 and reported a Rs 140 mn profit in 1997-98. while they flew only 63 hours.8 bn for IA. In the late 1990s. To survive the airline continued to add to its costs. Sen’s efforts seemed to have positive effects with an improvement in aircraft utilization figures. The idea of the productivity linked incentive (PLI) scheme was to persuade pilots to fly more in order to increase aircraft utilization. This number was later reduced to 25 and finally to 23. by paying more money to its employees. Pilots were flying 75 hours a month. a subsidiary airline company where the re-employed people were utilized. He was also instrumental in effecting substantial wage hikes for the employees. IA introduced the productivity-linked scheme. in yet another effort to appease its employees. the PLI schemes raised an additional annual wage bill of Rs 1. But recessionary trends in the economy and its mounting wage bill pushed IA back into losses by 1999. For instance. (Refer Table 99 . But the PLI scheme was grossly misused by large sections of the employees to earn more cash. The extra financial burden on the airline caused by these measures was met by resorting to a 10% annual hike in fares. Though experts agreed that IA had to cut its operation costs.8 Source: IATA-World Air Transport Statistics Initially. the agreement stated that if the engineering department made 28 Airbus A320s available for service every day.22 1/10/1995 25 22/09/1996 36 15/10/1997 13. PLI would be paid. Sen and the entire board of directors was sacked by the government. (Refer Table I) TABLE I IMPACT OF STAFF COST HIKE IN FARE INCREASE (%) Date of fare increase Impact (%) 25/07/1994 16.45 minutes late were shown as being on time for PLI purposes. It was alleged that IA employees did no work during normal office hours. this way they could not work overtime and earn more money.Sen averted a crisis by creating Alliance Air.

8. IA tried to persuade employees to cut down on PLI and overtime to help the airline weather a difficult period. Even the lowest paid employee in the airline. The payment of overtime allowance (OTA) which included holiday pay to staff.II).8 mn was registered during the period 1995-99.59 19% 58 95 (31. A net loss of Rs 641.12%) Source: IATA-World Air Transport Statistics * Figures in brackets indicate increase over the previous year. According to unofficial reports.74 22683 0. It was also found that the payment of OTA always exceeded the budget provisions. of employee percentage Effective Year (in Rs expenditure employees cost (in of total fleet size bn) (in Rs bn) mn) operational expenditure 19932.66 bn.000 – 10.10 22153 0.7.8. # Excludes 4 aircraft grounded from 1993-94 to 1995-96 as well as 12 aircraft leased to Airline Allied Services Ltd. from 1996-97 to 1998-99. during the same period.31 28% 41 99 (7.18%)* 1995.21 27% 40 98 (15.13 20.37 32. Though IA incurred losses during 1995-96 and 1996-97 and made only marginal profits during 1997-98 and 1998-99. arrears to be paid to employees on account of PLI 100 . was paid Rs 8. increased by 109% during 1993-99.39 34.29 26% 40 97 (24.03%) 1998.3. PLI payments alone amounted to Rs 6.75 15% 54 94 1994.85 22182 0.59%) 1996.35%) 1997.71 22582 0. either a sweeper or a peon.16 22. TABLE II INCREASE IN STAFF COSTS Staff cost Per as Staff cost Total No.17 21990 0. the increase in pay and allowances of the executive pilots was 842% and that of non-executive pilots was 134%. heavy payments were made on account of PLI.000 per month with overtime included. however there efforts failed. In 1998.25 26 25% 55 96 (52.75 21922 0.32 29. Between 1991-92 and 1995-96.5.

by acquiring the necessary job-related qualifications & experience.599 92853 261 Airways Jet Airways 19 3. there were 9 directors by 1999 overseeing the same functions. which doubled in the next three years.186 6546.235 245831 177 Kuwait 22 5. who in turn had their retinue of private secretaries. Thus.3 mn per annum in 199495 and the number increased to 2.109 by 1997-98. several 101 . There were 150 employees earning above Rs 0. in place of 6 directors in departments’ prior April 1998. Six new posts of directors were created of which three were created by dividing functions of existing directors.308 1416.761 345. TABLE III A COMPARISON OF VARIOUS AIRLINES Number ATKm Name of of No. 40 posts were introduced in the Southern Region on an ad-hoc basis.990 2113. IA had the maximum number of employees per aircraft. Another problem was that no basic educational qualifications prescribed for senior executive posts.549 14418.324 1064161 161 Airlines Thai Airways 76 24. (Refer Table III). pending the assessment of their requirement by the Staff Assessment Committee. Over the years.touched nearly Rs 7 bn by 1999. unproductive deployment of manpower and unwarranted increase in salaries and wages of the employees.722 1094.671 398204 431 Airlines Gulf Air 30 5.132 49756 196 Source: IATA-World Air Transport Statistics Analysts criticized the way posts were created in IA. The posts in non-executive cadres were to be created after the assessment by the Manpower Assessment committee. Illiterate IA employees drew salaries that were on par with senior civil servants. Even a matriculate could become a manager.627 270678 318 International Indian 51 21. of ATKm[3] Employees per Airlines aircraft employees (in Million) per aircraft Employee in fleet Singapore 84 13. The Brar committee attributed this abnormal increase in staff costs to inefficient manpower planning. There were 30 full time directors. After superannuation. the number of employees at IA increased steadily. In 1999. But analysts pointed that in the case of cabin crew. drivers and orderlies. It was reported that the airline’s monthly wage bill was as high as of Rs 680 mn.

According to reports. the human resources manager in an airline industry has the challenge of staffing for this ever-changing need. With each strike/go-slow and subsequent wage negotiations. Not only are they subject to regular bankruptcies. Various allowances such as out-of-pocket expenses. Because the airline's needs are in a constant state of flux. Thus. The biggest beneficiaries would be perhaps the passengers. they are subject to such uncontrollable factors as the political and economic situation of society and its customer base. Though at times the airline did put its foot down. from executives to pilots. IA’s financial woes kept increasing. from stewardesses to maintenance personnel. the carrier would be in a much better position to handle its labor problems. HR Challenges in the Airline Industry: The airline industry is perhaps one of the most volatile industries in the world. For instance. This did not augur well for any of the parties involved. All these problems had a negative impact on divestment procedure. by and large. experience allowance. and room air-conditioners even after retirement. as privatization was expected to give the IA management an opportunity to make the venture a commercially viable one. Freed from its political and social obligations. It is an industry whose way of doing business is constantly changing due largely in part to outside forces. TROUBLED SKIES Frequent agitations was not the only problem that IA faced in the area of human resources. the rates of highly subsidized canteen items were not revised even once in three decades and there was no policy on fixing rates. the first step the human resources manager must take is to establish a system that allows for a regular evaluation of the need and then recruit based on the evaluated need. it always acceded to the demands for wage hikes and other perquisites. who would get better services from the airline.employees were re-employed by the airline in an advisory capacity. IA employed 132 retired employees as consultants during 1995-96 on contract basis. The human resources manager will only be able to successfully recruit and thus staff each of 102 . Within the industry there are numerous different levels of positions. simulator allowance etc. mergers and acquisitions. There were issues that had been either neglected or mismanaged. were paid to those who were not strictly eligible for these. Excessive expenditure was incurred on benefits given to senior executives such as retention of company car.

There are costs that are external. along with technology and call-center support. whether it occur because of an employee strike or due to a drastic event such as a crash or terrorist attack.these diverse needs if they create a line of communications with each department in order to access their specific needs and then base the recruiting plan on the gathered information. being a full service airline it has huge scope to cut costs compared to LCC’s. it is demonstrative of the current trend to standardize many human resources functions in order to better serve the company's employees. For example. Recommendation. The biggest and most damaging human relations issue that a human relations manager will face is the threat or. in a sense. Although the implementation of this human resources technology may result in a cutback in some human resources positions. improve job satisfaction and thus reduce turnover and the resulting need for constant recruitment and training. Because the industry is rapidly changing. This trend clearly effects the airline human resources manager's role in that instead of working to recruit. working with the legal team to develop a contractual agreement. job security is a regular question of an employee at any level. in a worse case scenario. outsourced to a technological program. which AI cannot do much about. As the human resources manager in this volatile industry. they now have the role of receiving bids from private independent contractors. train and supervise multiple departments internally. Second. The human resources manager must have a plan in place to handle this worst-case-scenario that will allow for a quick resolution of the issues with minimal harm to the company's operations. Implementation and Monitoring Adopt strict cost control measures AI should improve their overall efficiency and try to cut costs in all their operations. AI needs to revise wages and implement multi-skill 103 . actual airline employees may become dissatisfied with both the terms of their current employment and the future implications of their position. it is imperative that one prepare for the worse. and then ensuring that the private contracted company is meeting the general need of the airline by working closely with the private service provider's human resources manager. the airline human resources manager must also have a strategic plan for reacting to an actual work stoppage. " This idea of outsourcing is not unique to the airline industry and often times does not necessarily mean outsourcing to a computer program. activities that are expensive. The software will now provide automated and standardized training. First. the actual carrying through of an employee strike at any level of the airline's multi-faceted set-up. challenge of the ever-changing need of the airline industry. recruitment and staffing. however there are internal costs that can be dealt. new technology is even effecting the role of the human resources manager in that many human resource function can now be.

AI should propose a float for MRO i. Instead of hiring expatriate’s pilots AI should make its own flight training schools and making the students have bonds with the company.environment. This can be immediately started by firstly focusing on maintenance. AI should focus on online ticketing and remove travel agents to cut on commissions. all requisite clearances for fuel hedging should be taken and use it to save costs due to ATF. Repair and Overhaul to maintain its old fleet. Maintenance. cut on excess staff by implementing a policy where staff are fired if they lack performance (refer appendix 9) and a strict check on corruption needs to be there where some secret staff can be given the responsibility of checking and giving them benefits. It can be suggested that government can offer portions of AI equity to the public while retaining the full management control. it’s just the management needs to plan and implement these strictly. and other updated versions should be purchased. Refresh and Rebrand the company 104 . and then purchasing in future. This little mixture of public and private function will really help AI develop. and other airlines have started flowing into India. Better services will motivate staff. the market is growing. The ageing fleet needs to be maintained by combining it to first class catering which will help in image building. it can also divest 20 percent of AI by next year. and it should be started as soon as possible. it desperately needs to acquire more fleet which should be a mix of wide and narrow body planes. deploying aircraft and deciding routes. Political leaders still control critical issues like appointing managers. but it needs to be regularly followed and monitored to prove to the government that it working better without their full control. Limit government control and policies for AI and its staff AI is in such bad condition as the government barely allows management of AI to make any important decisions. Their will be basic resources needed. its fleet is aging. Fleet size increase and invest in aircraft maintenance AI is in a vacuum.e.

oil contracts etc. 105 . They should redesign crew uniforms and retrain their employees. Air India needs to do innovative marketing. They should be saving millions of dollars by creating operational synergies in network integration. As AI really needs a fresh start. ground handling and purchasing aircraft. improvement in schedules. they need to give dual importance to domestic and international routes and combine both of their strengths. and by getting rid of half of their employees. as there is so much competition in the market. all the old methods needs to be changed or removed specially in area of HR policies with the help of this merger. the merged entity will bring in huge success. They should be able to attract passengers from SAARC. if they do it well. the passenger loyalty program. by expanding fleet and destination by more code share arrangements and by joining Star alliance which is already under process. rebranding the airline. flights to wide range of destinations as AI has the rights to follow so many destinations.AI and IA should get merged as. It can effectively deliver the classic hub and spoke system done by successful airlines. etc. It will also bring in new product and new environment in AI. They need to highlight customer service as their USPs by provide best catering and good maintenance of rest room which will help go a long way in attracting customers. The only caution AI and IA needs to take are at the time of rationalization of staff and while changing the HR policy which needs to be done very importantly. it needs to use it to its benefit. competitive pricing instead of just following marketing tactics of other players. They need better trained staff to ensure better results through excellent customer service. They will also help in saving costs by choosing better contracts for insurance. the decision making needs to be quicker. Africa and Central Asia to fly them to other parts. marketing. instead of being just an Indo gulf airline as it is also leading to inefficient usage of resources. information technology integration. it will help it in expanding the fleet. punctuality. Follow differentiation AI needs to differentiate its product. It can differentiate by serving non stop flights to routes which are not provided by others. making the staff more accountable by rewarding points.

according to a senior executive whose appointment. By the middle of next year. And the airline has renegotiated all its training contracts and lowered total training costs by 29%. a global grouping of airlines with 27 members including Lufthansa German Airlines andContinental Airlines Inc. 106 . even though there aren't enough passengers. has also been controversial. their ROCE % is also gone down and it is causing major loss in market share. All airport functions that Air India used to perform like security and baggage handling would be done by this SBU and its focus would be on customer care and it can help them build the long lost trust in the eyes of customers. but the airline’s new senior management wants to capture the lost glory of the “Maharajah” (the airline’s mascot). They should be better utilization level of its fleet. he added. Training In Air India Mumbai: Air India may be roiled by losses. In his first media interview after being appointed Air India’s chief training officer.Examine each and every aspect of its functioning AI is known for indifferent passenger handling over years. it should set up a strategic business unit (SBU) for ground handling at airports. when compared with the last fiscal year. ironically. A-I should also reform its notorious reservation system and analyze its yield planning which should eliminate the scope of overpriced commission to travel agents as it would stop fictitious block bookings which lead to an artificial overbooking of AI flights. and controversies over appointments. It needs to be regularly monitored by specific staff whose job description includes monitoring as their primary job. according to Sukumar. Air India will join Star Alliance. the airline has developed training programmes benchmarked to those of other Star Alliance members. Stephen Sukumar said the airline is in talks with some of the world’s best hotel chains to train its employees in an attempt “to bring back some of the once legendary shine of Air India on-board service”. And for ground staff. a cash crunch. they should have processes to monitor each and every staff’s productivity as the services provided by AI staff is non tolerable.

said the airline would have a single code by February 2011. But it will not be easy to match their expectations. He said he was interviewed by Prashant Narain Sukul. “We need worldwide access to other markets to participate in the global growth. Air India had made two key appointments on 28 September—of Sukumar and Air India Express’ chief operating officer Pawan Arora—despite objections being raised at the time by some members of the board. Major. 40.” he added.” he added. Sukumar is convinced the Star Alliance entry is critical to the airline’s fortunes. has been controversial and the government has appointed a two-member committee to review his appointment. and having a single code for the airline instead of two different codes currently—AI and IC (the code for formerlyIndian Airlines which merged with Air India). Air India has prepared a turnaround plan to wipe out its accumulated losses and reduce its total debt of Rs. Star Alliance offers nearly 2.000 destinations. the airline’s annual report doesn’t have a break-up of the amount spent on training. joining an alliance could lead to a 5% increase in passenger revenue. ministry of civil aviation. and this will be an unbeatable advantage for Air India to outperform its local competitors. F. prior to joining Star Alliance. and Air India’s independent director. Sukumar said the airline’s immediate focus is to modernize Air India’s booking system. Sukumar indicated that the controversy is behind him. joint secretary. Under the guidance of its new board. According to experts. The appointment of Sukumar. including shortage of personnel. 107 . around a month ago. low morale and the cash crunch. the former chief training officer at German airline Deutsche Lufthansa AG. “They found me suitable to be the chief training officer of Air India Ltd and they also wanted me to look after the Star Alliance project. But many say it will be tough to reverse the situation as the airline’s ownership is still with the government. A senior Air India executive who did not want to be identified.H.However. Several independent consultants said Air India’s service level has deteriorated due to various reasons.000 crore.

this is the case with Air India. 3) Ineffective Operations Main function of the Operations Management of any organization is to create a competitive edge by 15 – 20 % in terms of costs by operational excellence so that the organization can fight its competition in the market place effectively. We also provide our clients. Clients are avoiding the mistakes of hiring the unsuitable candidate (which results in high staff turnover with the consequential costs . Air India might have not thought of ‘cost leadership’ because of its employees’ low productivity and ‘poor’ cost awareness. disruption and absent resources) and are hence now consulting the pool of psychologists and selection specialists to assist them with sourcing of a key executive or to conduct large scale recruitment campaigns. with psychometric & psychological profiling The Reasons for the Downfall of Air India Recruitment process can be as: 1) Air India recruitment process and performance appraisal system can be at fault Good companies distinguish themselves by their quality people. Krishnan. more and more airlines are beginning to recognize the real cost of poor selection of candidate. Increasingly. our specialists have developed sophisticated systems and models for the assessment of candidates for various positions in cabin crew. either ab initio or in various recruitment phases. flight crew.1 airlines in terms of performance. Over years of our experience in the aviation sector. military and VIP corporate aircraft operators. 2) Employees can be incompetent and may not have any sense of belonging.Any HR expert will tell you that an organization needs to recruit good people who have the characteristics (talents) to win the market place. money.“One of the main drivers that led to privatization of British Airways was customer service. We select and recruit aviation personnel for a range of clients including civil. Airline or Aviation sector is witnessing a surge of increasing interest and awareness. It employs 600 persons for running and maintaining one air craft whereas Singapore Airlines employs just 27 persons for a similar air craft.wasted time. the industry has gained momentum. ground crew etc. who want to avail of our 'executive search' services for aviation personnel. Yet Singapore Airlines is rated as No. professor of corporate strategy at the Indian Recruitment Process: One of the most critical and high expertise demanding industry. The success of any organization comes through its people.” said Rishikesha T. This seems to be absent in Air India for the last 4 108 . This has contributed to a significant rise in the employee base in the airline industry and the industry is in need of a growing number of employees. With global liberalization and opening up of sector for private players. Government ownership seems to be a critical constraint when it comes to making dynamic changes in the airline to adapt to new service levels.

he tells ET's Anindya Upadhyay & TK Arun. Instead. many of these problems would be sorted out. still we are way behind the developed countries in terms of air transport. excess staff (roughly 500 per aircraft as against the industry norm of 140 per aircraft) outdated legacy technology and organisational structure. Air India. and a surprising will to prevail against these odds. 5) No service orientationLike nationalized banks. the flagship overseas carrier. Air transport is a basis infrastrure if we want the cities to grow and industrialization to happen across the country. a disempowered board with all key decision making vested in the government. With its mostly obsolete fleet. Therefore AI 109 . warped incentives built into union agreements that have expired but live on. The responsibility lies majorly with Air India because the private players would be interested to operate only on profitable routs. Indian Airlines. are rapidly losing market share to new competitors. and its domestic counterpart. There is little air connectivity within the cities across the country. thanks to political patronage. Somebody needs to take the responsibility of providing air connectivity in / with all the major cities of Indi Culture: The picture that comes out of Air India after a long interview with its chairman and managing director Arvind Jadhav is that of a sadly undercapitalised company (debt:equity ratio of 40:1).decades. large work forces and managements whose decision-making is entangled with that of the government. customer service is something unknown to Air India employees. But by the end of January. Finally the management could never think of any disciplinary action against them at all. the pilots & air-hostesses were behaving like bosses and the passengers were virtually treated like slaves in the mid-air There may be many more reason because of which the bottom line may have got eroded. Conclusion AI’s objective should be “to create world class airline in public sector in close cooperation with all its employees”. 4) Lack of disciplinary action No disciplinary action was ever reported against the erring pilots who went on strike every time the Management attempted some disciplinary action as a result. If the Organization would have been in profit it could have served the people in a better way. the pilot associations /unions practiced their armtwisting tactics as often as they could and brought the Management on their knees.

N.Human Resource Information System. Published in 1839 K Aswathappa. 6th Edition. Volume V. Human Resource Management System. Human Resource Management.needs to strictly follow the above recommendations to enhance its reputation and achieve its objectives and success of these will automatically help in monitoring Bibliography Books: • Vincent R. Mumbai. Vipul Prakashan. Human Resource and Personnel Management 3rd Edition Published in 1997. Ceriello. Issue 10. N Ahmed. Kale. Internet Sites: 110 . Vipul Prakashan. June 2008. G. • • • Magazines: • HR careers and jobs. 3rd Eddition.

in 2)www. Mention.hris.com Questionnaire (1) Which Software do you use/have used in Air India? SAP PEOPLE SOFT Others.1)www.vault. Universal___ ____________ ___________ (2) When was the software installed in Air India? 111 . if any.humanresource.com 3)www.co.

_IBM________ _ (5) Do mention the rates as given below: 1 – Highly agree 2 – Agree 4 – Disagree 5 – Highly Disagree 3 – Neutral 112 . if any.Less than 6 months ago ago 2-3years ago 6months-1year ago More than 3years ago 1-2years (3) When did you start using the software? Less than 6 months ago 6months-1year ago ago 2-3years ago More than 3years ago 1-2years (4) Who configured the software for Air India? Software vendor IT Team Others. Mention.

2. 5.S. then which modules and sub-modules are highly operative by you?-Yes Recruitment Master Data Separation 113 . if any. Particulars User-friendly System quality Information quality Industrial productivity Service quality Management culture Quality Decisions SAP PEOPLE SOFT Others Universal $ $ $ $ $ $ $ (6) Did the software companies provide any sort of assistance/training to the users? If yes. 7.No. 3. 1. 4. 6. then which type of assistance/training was provided? _________ Classroom Training Online Training On-the-Job Training Others. Mention. __________ (7) Are you able to use the software entirely? If no.

Since the software is installed recently. its easy classification • It helps in better analysis and more effective decisions making • Provides us with accurate information. quality reports and overall better work culture • Eliminates personal biasness. if any. (10) What are the problems faced by HR people while using the system? • Although the system is efficient. brings transparency. (11) How does implementation of such system in organization.It will take some time time to analyse the area where more improvements is required.Personnel Management Performance Management Time management Reports Payroll Others. but sometimes we face the problems like system slowdown or higher downtimes and if there is some particular limitation in module than work suffers. affect its culture and employees? 114 . some HR people are not comfortable in using system efficiently so time is to be given in training for the system. (9)What Benefits do you get from the information system? • HRIS system is able to provide us various benefits like speedy retrieval and processing of data. ____________ _____ (8) Areas of Improvements. Mention.

Authorization. (13) How much secure is the system actually from HR point of view? • System is absolutely secure. • The transfer and application system seem to have provided the management with an excuse for leaving difficult problems to their successor (12) What are the uses of HRIS in different functions of HR? • HRIS system is helping out in all the functions and activities related to HR like payroll processing. recruitments etc. But some time some senior employees are resistant to the change also. 115 . job evaluation process and appraisals. training and development . We have three level security system in our application. by providing accurate and timely information and helping in better analysis of information. Authentication and Auditing.• With the introduction of HRIS system the work culture in the organization gets changed and we as HR managers are able to serve to other employees in efficient manner which is again raising the satisfaction level among ourselves.