HUMAN RESOURCE MANAGEMENT

Introduction

Human beings are social beings and hardly ever live and work in
isolation. We always plan, develop and manage our relations both
consciously and unconsciously. The relations are the outcome of our actions
and depend to a great extent upon our ability to manage our actions. From
childhood each and every individual acquire knowledge and experience on
understanding others and how to behave in each and every situations in life.
Later we carry forward this learning and understanding in carrying and
managing relations at our workplace. The whole context of Human Resource
Management revolves around this core matter of managing relations at work
place.

Since mid-1980’s Human Resource Management (HRM) has gained

acceptance in both academic and commercial circle. HRM is a
multidisciplinary organizational function that draws theories and ideas from
various fields such as management, psychology, sociology and economics.

There is no best way to manage people and no manager has

formulated how people can be managed effectively, because people are
complex beings with complex needs. Effective HRM depends very much on
the causes and conditions that an organizational setting would provide. Any
Organization has three basic components, People, Purpose, and Structure.

In 1994, a noted leader in the human resources (HR) field made the
following observation: Yesterday, the company with the access most to the
capital or the latest technology had the best competitive advantage; Today,
companies that offer products with the highest quality are the ones with a
leg up on the competition; But the only thing that will uphold a company’s
advantage tomorrow is the calibre of people in the organization.

That predicted future is today’s reality. Most managers in public- and

private sector firms of all sizes would agree that people truly are the
organization’s most important asset. Having competent staff on the payroll
does not guarantee that a firm’s human resources will be a source of
competitive advantage.

However in order to remain competitive, to grow, and diversify an

organization must ensure that its employees are qualified, placed in
appropriate positions, properly trained, managed effectively, and committed
to the firm’s success. The goal of HRM is to maximize employees’
contributions in order to achieve optimal productivity and effectiveness,
while simultaneously attaining individual objectives (such as having a
challenging job and obtaining recognition), and societal objectives (such as
legal compliance and demonstrating social responsibility).

What is Human Resource Management?

HRM is the study of activities regarding people working in an

organization. It is a managerial function that tries to match an
organization’s needs to the skills and abilities of its employees.

Definitions of HRM

Human resources management (HRM) is a management function

concerned with hiring, motivating and maintaining people in an organization.
It focuses on people in organizations. Human resource management is
designing management systems to ensure that human talent is used
effectively and efficiently to accomplish organizational goals.

According to the Invancevich and Glueck, “HRM is concerned with the

most effective use of people to achieve organizational and individual goals. It
is the way of managing people at work, so that they give their best to the
organization”.

According to Dessler (2008) the policies and practices involved in

carrying out the “people” or human resource aspects of a management
position, including recruiting, screening, training, rewarding, and appraising
comprises of HRM.

Generally HRM refers to the management of people in organizations. It

comprises of the activities, policies, and practices involved in obtaining,
developing, utilizing, evaluating, maintaining, and retaining the appropriate
number and skill mix of employees to accomplish the organization’s
objectives. The goal of HRM is to maximize employees’ contributions in order
to achieve optimal productivity and effectiveness, while simultaneously
attaining individual objectives (such as having a challenging job and
obtaining recognition), and societal objectives (such as legal compliance and
demonstrating social responsibility).

In short Human Resource Management (HRM) can be defined as the art

of procuring, developing and maintaining competent workforce to achieve
the goals of an organization in an effective and efficient manner.
______________________________________________________________________________
Nature of HRM

HRM is a management function that helps manager’s to recruit, select,

train and develop members for an organization. HRM is concerned with
people’s dimension in organizations.

The following constitute the core of HRM

1. HRM Involves the Application of Management Functions and Principles.

The functions and principles are applied to acquiring, developing,
maintaining and providing remuneration to employees in organization.
2. Decision Relating to Employees must be integrated. Decisions on
different aspects of employees must be consistent with other human
resource (HR) decisions.
3. Decisions Made Influence the Effectiveness of an Organization.
Effectiveness of an organization will result in betterment of services to
customers in the form of high quality products supplied at reasonable
costs.
4. HRM Functions are not confined to Business Establishments Only but
applicable to non-business organizations such as education, health
care, recreation and like.

HRM refers to a set of programmes, functions and activities designed and

carried out in order to maximize both employee as well as organizational
effectiveness.

Scope of HRM

The scope of HRM is indeed vast. All major activities in the working life
of a worker – from the time of his or her entry into an organization until he or
she leaves the organizations comes under the purview of HRM.

The major HRM activities include HR planning, job analysis, job design,
employee hiring, employee and executive remuneration, employee
motivation, employee maintenance, industrial relations and prospects of
HRM.
The scope of Human Resources Management extends to:

 All the decisions, strategies, factors, principles, operations, practices,

functions, activities and methods related to the management of people
as employees in any type of organization.
  All the dimensions related to people in their employment relationships,
and all the dynamics that flow from it
The scope of HRM is really vast. All major activities in the working life of a
worker – from the time of his or her entry into an organization until he or she
leaves it comes under the purview of HRM. American Society for Training and
Development (ASTD) conducted fairly an exhaustive study in this field and
identified nine broad areas of activities of HRM.
These are given below:

 Human Resource Planning

 Design of the Organization and Job
 Selection and Staffing
 Training and Development
 Organizational Development
 Compensation and Benefits
 Employee Assistance
 Union/Labour Relations
 Personnel Research and Information System

a. Human Resource Planning: The objective of HR Planning is to

ensure that the organization has the right types of persons at the right
time at the right place. It prepares human resources inventory with a
view to assess present and future needs, availability and possible
shortages in human resource.
Thereupon, HR Planning forecast demand and supplies and identify
sources of selection. HR Planning develops strategies both long-term
and short-term, to meet the man-power requirement.

b. Design of Organization and Job: This is the task of laying down

organization structure, authority, relationship and responsibilities. This
will also mean definition of work contents for each position in the
organization. This is done by “job description”. Another important step
is “Job specification”. Job specification identifies the attributes of
persons who will be most suitable for each job which is defined by job
description.

c. Selection and Staffing: This is the process of recruitment and

selection of staff. This involves matching people and their expectations
with which the job specifications and career path available within the
organization.

d. Training and Development: This involves an organized attempt to

find out training needs of the individuals to meet the knowledge and
skill which is needed not only to perform current job but also to fulfil
the future needs of the organization.
 e. Organizational Development: This is an important aspect whereby
“Synergetic effect” is generated in an organization i.e. healthy
interpersonal and inter-group relationship within the organization.
f. Compensation and Benefits: This is the area of wages and salaries
administration where wages and compensations are fixed scientifically
to meet fairness and equity criteria. In addition labour welfare
measures are involved which include benefits and services.

g. Employee Assistance: Each employee is unique in character,

personality, expectation and temperament. By and large each one of
them faces problems every day. Some are personal some are official.
In their case he or she remains worried. Such worries must be removed
to make him or her more productive and happy.

h. Union-Labour Relations: Healthy Industrial and Labour relations are

very important for enhancing peace and productivity in an
organization. This is one of the areas of HRM.

i. Personnel Research and Information System: Knowledge on

behavioral science and industrial psychology throws better insight into
the workers expectations, aspirations and behaviour. Advancement of
technology of product and production methods have created working
environment which are much different from the past. Globalization of
economy has increased competition many fold. Science of ergonomics
gives better ideas of doing a work more conveniently by an employee.
Thus, continuous research in HR areas is an unavoidable requirement.
It must also take special care for improving exchange of information
through effective communication systems on a continuous basis
especially on moral and motivation.

HRM is a broad concept; personnel management (PM) and Human resource

development (HRD) are a part of HRM.

Objectives of HRM

The primary objective of HRM is to ensure the availability of competent and

willing workforce to an organization. The specific objectives include the
following:

1) Human capital: assisting the organization in obtaining the right number

and types of employees to fulfil its strategic and operational goals

2) Developing organizational climate: helping to create a climate in which

employees are encouraged to develop and utilize their skills to the
fullest and to employ the skills and abilities of the workforce efficiently
 3) Helping to maintain performance standards and increase productivity
through effective job design; providing adequate orientation, training
and development; providing performance-related feedback; and
ensuring effective two-way communication.

4) Helping to establish and maintain a harmonious employer/employee

relationship

5) Helping to create and maintain a safe and healthy work environment

6) Developing programs to meet the economic, psychological, and social

needs of the employees and helping the organization to retain the
productive employees

7) Ensuring that the organization is in compliance with

provincial/territorial and federal laws affecting the workplace (such as
human rights, employment equity, occupational health and safety,
employment standards, and labour relations legislation). To help the
organization to reach its goals

8) To provide organization with well-trained and well-motivated

employees

9) To increase the employees satisfaction and self-actualization

10) To develop and maintain the quality of work life

11) To communicate HR policies to all employees.

12) To help maintain ethical polices and behaviour

The above stated HRM objectives can be summarized under four specific
objectives: societal, organizational, and functional and personnel
 Table 1
a. Societal Objectives: seek to ensure that the organization becomes
socially responsible to the needs and challenges of the society while
minimizing the negative impact of such demands upon the
organization. The failure of the organizations to use their resources for
the society’s benefit in ethical ways may lead to restriction.

b. Organizational Objectives: it recognizes the role of HRM in bringing

about organizational effectiveness. It makes sure that HRM is not a
standalone department, but rather a means to assist the organization
with its primary objectives. The HR department exists to serve the rest
of the organization.

c. Functional Objectives: is to maintain the department’s contribution at a

level appropriate to the organization’s needs. Human resources are to
be adjusted to suit the organization’s demands. The department’s
value should not become too expensive at the cost of the organization
it serves.

d. Personnel Objectives: it is to assist employees in achieving their

personal goals, at least as far as these goals enhance the individual’s
 contribution to the organization. Personal objectives of employees
must be met if they are to be maintained, retained and motivated.
Otherwise employee performance and satisfaction may decline giving
rise to employee turnover.

HRM Objectives and Functions

HRM Objectives Supporting Functions

1. Societal Objectives Legal compliance
Benefits
Union- management
relations
2. Organizational Objectives Human Resource Planning
Employee relations
Selection
Training and development
Appraisal
Placement
Assessment
3. Functional Objectives Appraisal
Placement
Assessment
4. Personnel Objectives Training and development
Appraisal
Placement
Compensation
Assessment
Table 1.1

Functions of HRM

Human Resources management has an important role to play in

equipping organizations to meet the challenges of an expanding and
increasingly competitive sector. Increase in staff numbers, contractual
diversification and changes in demographic profile which compel the HR
managers to reconfigure the role and significance of human resources
management. The functions are responsive to current staffing needs, but can
be proactive in reshaping organizational objectives. All the functions of HRM
are correlated with the core objectives of HRM (Table 1.1). For example
personal objectives is sought to be realized through functions like
remuneration, assessment etc.
 Table 1.2

HR management can be thought of as seven interlinked functions

taking place within organizations, as depicted in Figure 1.2 Additionally,
external forces—legal, economic, technological, global, environmental,
cultural/geographic, political, and social—significantly affect how HR
functions are designed, managed, and changed. The functions can be
grouped as follows:

1. Strategic HR Management: As a part of maintaining organizational

competitiveness, strategic planning for HR effectiveness can be
increased through the use of HR metrics and HR technology.

Human resource planning (HRP) function determine the number and

type of employees needed to accomplish organizational goals. HRP
includes creating venture teams with a balanced skill-mix, recruiting
 the right people, and voluntary team assignment. This function
analyses and determines personnel needs in order to create effective
innovation teams. The basic HRP strategy is staffing and employee
development.

2. Equal Employment Opportunity: Compliance with equal

employment opportunity (EEO) laws and regulations affects all other
HR activities.

3. Staffing: The aim of staffing is to provide a sufficient supply of

qualified individuals to fill jobs in an organization. Job analysis,
recruitment and selection are the main functions under staffing.
Workers job design and job analysis laid the foundation for staffing by
identifying what diverse people do in their jobs and how they are
affected by them. Job analysis is the process of describing the nature
of a job and specifying the human requirements such as knowledge,
skills, and experience needed to perform the job. The end result of job
analysis is job description. Job description spells out work duties and
activities of employees.

Through HR planning, managers anticipate the future supply of and

demand for employees and the nature of workforce issues, including
the retention of employees. So HRP precedes the actual selection of
people for organization. These factors are used when recruiting
applicants for job openings. The selection process is concerned with
choosing qualified individuals to fill those jobs.

In the selection function, the most qualified applicants are selected for
hiring from among the applicants based on the extent to which their
abilities and skills are matching with the job.

4. Talent Management and Development: Beginning with the

orientation of new employees, talent management and development
includes different types of training. Orientation is the first step towards
helping a new employee to adjust himself to the new job and the
employer. It is a method to acquaint new employees with particular
aspects of their new job, including pay and benefit programmes,
working hours and company rules and expectations.

Training and Development programs provide useful means of assuring

that the employees are capable of performing their jobs at acceptable
levels and also more than that. All the organizations provide training
for new and in experienced employee. In addition, organization often
provide both on the job and off the job training programmes for those
employees whose jobs are undergoing change.
 Likewise, HR development and succession planning of employees and
managers is necessary to prepare for future challenges. Career
planning has developed as result of the desire of many employees to
grow in their jobs and to advance in their career. Career planning
activities include assessing an individual employee’s potential for
growth and advancement in the organization.

Performance appraisal includes encouraging risk taking, demanding

innovation, generating or adopting new tasks, peer evaluation,
frequent evaluations, and auditing innovation processes

This function monitors employee performance to ensure that it is at

acceptable levels. This strategy appraises individual and team
performance so that there is a link between individual innovativeness
and company profitability. Which tasks should be appraised and who
should assess employees’ performance are also taken into account.

5. Total Rewards: Compensation in the form of pay, incentives and

benefits are the rewards given to the employees for performing
organizational work. Compensation management is the method for
determining how much employees should be paid for performing
certain jobs.

Compensation affects staffing in that people are generally attracted to

organizations offering a higher level of pay in exchange for the work
performed. To be competitive, employers develop and refine their
basic compensation systems and may use variable pay programs such
as incentive rewards, promotion from within the team, recognition
rewards, balancing team and individual rewards etc. This function uses
rewards to motivate personnel to achieve an organization’s goals of
productivity, innovation and profitability. Compensation is also related
to employee development in that it provides an important incentive in
motivating employees to higher levels of job performance to higher
paying jobs in the organization.

Benefits are another form of compensation to employees other than

direct pay for the work performed. Benefits include both legally
required items and those offered at employer’s discretion.

Benefits are primarily related to the area of employee maintenance as

they provide for many basic employee needs.

6. Risk Management and Worker Protection: HRM addresses various

workplace risks to ensure protection of workers by meeting legal
requirements and being more responsive to concerns for workplace
health and safety along with disaster and recovery planning.
 7. Employee and Labour Relations: The relationship between
managers and their employees must be handled legally and
effectively. Employer and employee rights must be addressed.

It is important to develop, communicate, and update HR policies and

procedures so that managers and employees alike know what is
expected. In some organizations, union/management relations must be
addressed as well. The term labour relation refers to the interaction
with employees who are represented by a trade union.

Unions are organization of employees who join together to obtain more

voice in decisions affecting wages, benefits, working conditions and
other aspects of employment. With regard to labour relations the major
function of HR personnel includes negotiating with the unions
regarding wages, service conditions and resolving disputes and
grievances.

CASELET:

Analyse the following situation and use the graph for your reference.
Use long bond paper.

1. During the job interview process, two candidates stand out distinctly.
One demonstrates a positive attitude, pessimism, strong interpersonal
skills, and effective communication abilities, yet performs at an
average level as an employee. The other presents an impressive
resume, proficiency in English, expertise in software services,
intellectual acumen, and graduated with Magna Cum Laude, but
displays a nonchalant demeanor.

Advantages on hiring

APPLICANT A How will you help him/her

to improve?
Disadvantages on hiring

If you’re going to choose

on applicant, which one
and why?
Advantages on hiring

APPLICANT B How will you help him/her

to improve?
Disadvantages on hiring