HUMAN RESOURCE

MANAGEMENT

UNIT – I
Understanding Human Management and Framework:

Concepts and Perspectives ; Evolution and Philosophy ; challenges in

changing environment. Human Resource Policy
  HUMAN RESOURCE MANAGEMENT is a process of making the
efficient and effective use of human resources so that the set goals are
achieved .

Edward Flippo refers to it as, “Personnel management or say human

resource management is the planning, organising, directing and
controlling of the procurement, development, compensation,
integration, maintenance and separation of human resources to the end
that individual, organisational and social objectives are accomplished”
 PHILOSOPHY OF HRM

HRM is climbing up the peak of humanitarianism with its distinct policies and
programmes. HRM insists on mutuality.

Mutuality is the common feeling felt by one another .

The mutuality relates to :

1.Mutual goal--- The organization and individuals depend on each other.

2. Mutual respect--- “Give respect and take respect”. Respect among the members
leads to a healthy culture and climate.

3.Mutual rewards---

4.Mutual Responsibilities----
 Whenever you see a balance sheet of a company , you see the assets and
liabilities which are usually the material elements.

Can you name the company that puts human resources as assets in balance
sheet and started the tradition of considering their employees as appreciating
assets?

It is Infosys!!!!!
You all know that it is a very successful company, and the success has come with
just not planning and utilization of material resources, but with Human resources,
as they are the most valuable assets for any organization.
So you see how important people are in delivering the best of whatever the
organisation IItt iiss IInnffoossyyss!!!!!!!!!!
 PERSONNEL MANAGEMENT VS
HRM
PM HRM
Management of employed Management of employee’s
people skills, ability, knowledge
Economic man Economic + social
+Psychological man

Viewed as commodity Treated as resource

Cost culture Profit centre

Organisation benefits Mutual benefit
Reactive Proactive
Trust –Low Trust-High
Reward mgmt-Job Performance related
Evaluation
Monitoring Nurturing
Leadership-Transactional Transformational
Key people-IR/PM Line people
Specialist
Core values of HRM:
The core values of HRM states that :
1.Human beings are the crucial aspects of every organization. The greater is the
commitment of the human resources the more successful is the organization.

2. An individual is a whole person. He brings all aspects of his personality,

attitudes, traits and behavior to the work place.

3. All people represents the organization. The building, equipment and other
resources productive only because they are being handled by the hyper energise
force of humans.

4.People are different from each other. They vary in abilities, nature, personality,
religion etc. people are also influenced by social economic and environmental
factors
5. Human resources have to be acquired, developed and motivated to give higher
performances and also must be retained.

6. The success of an organization depends upon the satisfaction of

organizational needs and employees needs. There are various levels of
hierarchical levels in an organisation. The people who manage (i.e., the managers),
and people who are at work (subordinates). The effective coordination and
commitment between managers and subordinates is essential for organizational
success. Apart from that healthy relation ships are to be maintained with
consumers, shareholders, entrepreneurs, governments and suppliers.

7. Human relations enable people to work effectively in an organization with other

people in organization.
 OBJECTIVES OF HRM

 Ensure the availability of Right people for right job

To Provide competent and motivated employees
To utilize available human resources .
To maintain good human relationship
To provide training & education
To employ the knowledge & skill of workers
To create favourable atmosphere
To reconcile individual/group goals with organisation goal
To motivate the employees
To maintain ethical policies & behaviour
Current Classification of HR roles
According to R.L Mathis and J. H. Jackson (2010) several roles can be fulfilled
by HR management. The
nature and extent of these roles depend on both what upper management wants
HR management to do and what competencies the HR staff have demonstrated.
Three roles are typically identified for HR. The focus of each of them, :

Administrative
Personnel practices
Legal compliance forms and paperwork

Operational Actions
Managing employee
relationship issues
Employee advocate

Strategic HR
Organizational/business strategies
HR strategic or planning , Evaluation of HR effectiveness.
HRM WHEEL
SCOPE OF HRM
HRM OBJECTIVES & FUNCTION
HRM OBJECTIVES SUPPORTING FUNCTION
SOCIETAL OBJECTIVES  LEGAL COMPLIANCE
 BENEFITS
 UNION – MGMT RELATIONS

ORGANISATIONAL OBJECTIVES  HRP

 EMP.RELATIONS
 RECRUITMENT
 T&D
 APPRAISAL
 PLACEMENT
 ASSESSMENT
 APPRAISAL,PLACEMENT,ASSESSMENT
FUNCTIONAL OBJECTIVES

PERSONAL OBJECTIVES  Training,development,appraisal,

 placement,compensation,assessment
FUNCTIONS OF HRM
 GUIDELINES FOR BETTER HRM
1.DEVELOP PEOPLE

2.GROOMING FURTURE TALENT

3.EMPLOYEE DEPLOYMENT

4.BUILD EMPLOYEE COMMUNITIES

5.TURN MANAGER INTO COACHES

6.IMPROVE COMMUNICATION

7.BUILD CORDIAL RELATIONSHIP

8. COUNCELLING IF REQUIRE

9.FAIR & EQUITABLE COMPENSATION

 Evolution of HRM
The evolution of HRM can be traced back to Kautilya Artha Shastra where he
recommends that government must take active interest in public and private
enterprise. He says that government must provide a proper procedure for
regulating employee and employee relation.

In the medieval times there were examples of kings like Allaudin Khilji who
regulated the market and charged fixed prices and provided fixed salaries to their
people. This was done to fight inflation and provide a decent standard of living
during the pre independence period of 1920 the trade union emerged.

Many authors who have given the history of HRM say that HRM started because
of trade union....... and the First World War.

The Royal commission in 1931 recommended the appointment of a labour

welfare officer to look into the grievances of workers.
The factory act of 1942 made it compulsory to appoint a
labour welfare officer if the factory had 500 or more than 500 workers.
The international institute of personnel management and national institute of
labour management were set up to look into problems faced by workers to provide
solutions to them.

The Second World War created awareness regarding workers rights and 1940‘s to
1960‘s saw the introduction of new technology to help workers.

The 1960‘s extended the scope of human resource beyond welfare. Now it was a
combination of welfare, industrial relation, administration together it was called
personnel management. With the second 5 year plan, heavy industries started and
professional management became important.

In the 70‘s the focus was on efficiency of labour while in the 80‘s the focus was on
new technology, making it necessary for new rules and regulations.

In the 90‘s the emphasis was on human values and development of people and with
liberalization and changing type of working people became more and more important
there by leading to HRM which is an advancement of personnel management.
It is critical that today’s organizations align their human resources to better meet
strategic objectives. A failure to do so results in wasted time, energy, and resources.
Organizations are more likely to achieve this alignment with their corporate objectives
when they review their recruitment and selection processes for fit, communicate the
mission and vision statements, use joint goal setting, design an appropriate reward
system, empower the workforce, promote and develop from within, and use teams to
achieve synergy.

Human Resource Management is the management function that helps the managers to
plan, recruit, select, train, develop, remunerate and maintain members for an
organization. HRM has four objectives of societal, organizational, functional and
personal development. An organization must have set policies;
Definite procedures and well defined principles relating to its personnel and these
contribute to the effectiveness, continuity and stability of the organization.
 HR Management Challenges

The environment faced by HR management is a challenging one; changes are

occurring rapidly across a wide range of issues. A study by the Hudson Institute,
entitled Workforce 2020, has highlighted some of the most important workforce
issues. It appears that the most prevalent challenges facing HR management are as
follows:

l Economic and technological change

2 Workforce availability and quality concerns

3 Demographics and diversity issues

4 Organizational restructuring

5.Changing Nature of Work

6. Globalization
Economic and Technological Change:
Several economic changes have occurred that have altered employment and
occupational patterns in the United States. A major change is the shift of jobs from
manufacturing and agriculture to service industries and telecommunications.
This shift has meant that some organizations have had to reduce the number of
employees, while others have had to attract and retain employees with different
capabilities than previously were needed. Additionally, pressures from global
competitors have forced many U.S. firms to close facilities, adapt their management
practices, and increase productivity and decrease labour costs in order to become
more competitive. Finally, the explosive growth of information technology,
particularly that linked to the Internet, has forced many changes throughout
organizations of all types.
•GLOBAL COMPETITION

•WORKFORCE QUALITY DEFICIT

•GROWTH IN CONTINGENT WORKFORCE

In the past, temporary workers were used for vacation relief, maternity leave, or workload peaks.
Today “contingent workers”
(temporary workers, independent contractors, leased employees, and part-timers)
represent over 20% of the workforce.
Many employers operate with a core group of regular employees with critical skills and then expand
and contract the workforce through the use of contingent workers.
•Demographics and Diversity

•Aging of the Work Force

•Balancing Work and Family

POINT TO BE PONDER-----
6. In India , the evolution of HRM is traced back to the 1920s as a state
intervention to solve the problems of employee grievances . Evolving along
the years, a new approach the human resource management – has emerged
for managing people with a pragmatic and flexible approach.

7. Environment of HRM comprises of internal environment i.e. unions,

organisational culture and conflict .professional bodies and organisational
objectives and external environment i.e. economic, technological , and
demographic forces.
 HUMAN RESOURCE POLICIES
, “ A policy is a man-made rule of pre- determined courses of action that is established
to guide the performance of work towards the organisation objectives.”

 “ Policies are statements of the organisation’s over-all purposes and its objectives in
the various areas with which its operations are concerned- personnel, finance,
production, marketing and so on.”

Peter Drucker says: “The management must gear its policies and objectives in such a
fashion that the employees perform their work. It implies a consideration of human
being as a resource having psychological properties, abilities and limitations requiring
same amount of engineering attention as any other resource and it is the management
alone that can satisfy the requirements of motivation, participation, satisfaction,
leadership.
HR Policies are:

1) The keystone in the arch of management and the life-blood for the
successful functioning of the personnel management for lasting improvement
in labour relations.

2) The statements of Intention indicating an agreement to a general course of

action and purposes.

3) A positive declaration and a command to an organisation translating the

goals into selected routes and dictating practices and procedures.
Objectives of HR Policies:

1) Fulfilment of the organisational object.

2) Informing the employees about the policies.

3) Development of sincere sense of duty within the enterprise.

4) Providing adequate and trained personnel at all levels.

5) Protection of the common interest of all parties.

6) Establishment of mutual confidence and avoidance of misunderstanding.

7) Opportunity for growth who are willing to learn and train.

8) Recognition of work and accomplishments by offering rewards

Characteristics of sound HR policies:

1) Definite, positive, clear and easily understood by everyone.

2) It should be in writing in order to preserve loss.

3) Reasonably stable but not rigid i.e. periodically revised.

4) Balanced with the kind of reputation the enterprise wants to build up.
5) Recognise the desire of workers.

6) In the best interest of all parties- employer, employee and public community.

7) Based on careful analysis of all the available facts.

8) Must provide a two-way communication between employer and employees.

Types of HR Policies:

There are two types of policies:

1) Functional policies- are grouped for different categories of personnel. ex:

management dealing with personnel planning, organising and controlling.
2) Centralised policies- are framed for companies with several locations. They are
formulated at head office and apply throughout the organisation.

 Policies are further classified as:

3) Major policies- pertaining to the over-all objectives, procedures and control which
affect an organisation as a whole. Ex: product, financing, org. structure, plant
location etc.
4) Minor policies- cover relationships in a segment of an organisation, with
considerable emphasis on details and procedures. Such policies are the outgrowth
of major policies and preserve their unity of purpose.
Forms of delivery of HR policies:

1) Written standard practice, procedures issued to cover company policies, with

supplements to cover changes.
2) Booklets, bulletins, issued to new employees setting forth rights, privileges
and responsibilities.
3) Verbal instructions from immediate superiors.

4) Group meetings of new employees convened regularly.

5) Union contract

6) Company paper or house organ, giving details about company policies.

7) Conference conducted as a part of executive training programme

Steps in HR Policy designing:

1) Initiating a policy.
2) Uncovering of facts by the personnel department.
3) Recommending a policy to the top management and eliciting the views of all
concerned.
4) Putting down a policy in writing.
5) Explaining and discussing the proposed policy with members of the
organisation.
6) Adopting and launching it.
7) Communicating it to employees at all levels.
8) Administering it.
9) Initiating follow-up action on it.
10) Evaluating it.
11) Reformulating the policy.
For Example

Tata steel’s Personnel Policy

The statement Objectives of the Tata Iron & steel Co. Ltd. gives a clear cut policy
towards its employees:

1) By a realistic and generous understanding and acceptance of their needs and

rights.

2) By proving adequate wages, good working conditions, job security, an effective

machinery for redressal of grievances and suitable opportunities of promotion.

3) By treating them as individuals, giving them a sense of self-respect.

4) By creating a sense of belongingness through human and purposeful activities as

an integral part of human