Lecture

Unit3 HUMAN RESOURCE MANAGEMENT

1
Topics Human Resource Management: Introduction
Bloom’s
Learning Outcome (LO) At the end of this lecture, students will be able to
Knowledge Level
LO1 Understanding HRM Concepts Understanding

LO2 Application of HRM Practices Apply

INTRODUCTION

Behind the production of every product or service there is an human mind, effort and man hours
(working hours). No product or service can be produced without help of human being. Human being
is the fundamental resource for making or constructing anything. Today many experts claim that
machines and technology are replacing human resource and minimizing their role or effort.
However, indeed, machines and technology are built by the humans; they need to be operated or at
least monitored by humans. Maybe because of this reason, companies have continuously been
searching for talented, skilled and qualified professionals to further develop latest machines and
technology, which again have to be controlled or Monitored by humans to bring out products.
It is undisputed fact that humans are being replaced by artificial intelligence which means robots.
But all jobs cannot be handed over to Robots, to say in other words robots have its own limitations
and all roles cannot be handled by robots. Though British theoretical physicist Stephen Hawking,
Cambridge professor expressed about destruction of middle-class jobs due to raise of artificial
intelligence, he still felt that natural intelligence or need for application of human mind is inevitable
in certain roles.
Human Resource Management: Human resource management is the process of managing the
human resources of an organization in tune with the vision of the top management.
Human Resource Management is the process of recruitment and selecting employee, providing
orientation and induction, training and development, assessment of employee (performance of
appraisal), providing compensation and benefits, motivating, maintaining proper relations with
employees and with trade unions, maintaining employees’ safety, welfare and healthy measures in
compliance with labor laws of the land.
Why name 'Human Resource Management'?
Human: refers to the skilled workforce in the organization.
Resource: refers to limited availability or scarceness.
Management: refers how to optimize and make best use of such limited and a scarce resource so as
to meet the ordination goals and objectives.
Altogether, human resource management is the process of proper and maximizes utilization of
available limited skilled workforce. The core purpose of the human resource management is to make
efficient use of existing human resource in the organization. The Best example at present situation
is, construction industry has been facing serious shortage of skilled workforce. It is expected to triple
in the next decade from the present 30 per cent, will negatively impact the overall productivity of the
sector, warn industry experts.
Every organization’s desire is to have skilled and competent people to make their organization more
effective than their competitors. Humans are very important assets for the organization rather than
land and buildings, without employees (humans) no activity in the organization can be done.
Machines are meant to produce more goods with good quality but they should get operated by the
human only.
Definitions:
Many great scholars had defined human resource management in different ways and with different
words, but the core meaning of the human resource management deals with how to manage people
or employees in the organization.
Edwin Flippo defines- HRM as ―planning, organizing, directing, controlling of procurement,
development, compensation, integration, maintenance and separation of human resources to the end
that individual, organizational and social objectives are achieved.
The National Institute of Personal Management (NIPM) of India has defined human resources –
personal management as ―that part of management which is concerned with people at work and
with their relationship within an enterprise. Its aim is to bring together and develop into an effective
organization of the men and women who make up enterprise and having regard for the well – being
of the individuals and of working groups, to enable them to make their best contribution to its
success.
Human Resource management includes:

1. Conducting job analyses,

2. Planning personnel needs, and recruitment,

3. Selecting the right people for the job,

4. Orienting and training,

5. Determining and managing wages and salaries,

6. Providing benefits and incentives,

7. Appraising performance,

8. Resolving disputes,

9. Communicating with all employees at all levels. Formerly called personnel management.

10. Maintaining awareness of and compliance with local, state and federal labor laws.

11. These are also called as functions of human resource management for the purpose of effect
you utilization of human resource.
 Assessment questions to the lecture

Qn Bloom’s
Question Answer
. Knowledge Level
No
1 Which of the following is a primary function Correct Answer: Remembering
of human resource management?
C. Recruitment and
A. Financial management selection

B. Production management
C. Recruitment and selection
D. Marketing strategy
Which of the following is NOT a stage in the Correct Answer: Understanding
recruitment process? C. Employee on
boarding
A. Job analysis
B. Screening
C. Employee on boarding
D. Sourcing candidates

Which of the following is a common method of Correct Answer: Remembering

employee selection? B. Reference
checks
A. Job rotation
B. Reference checks
C. Work-life balance
D. Employee engagement surveys

Students have to prepare answers for the following questions at the end of the lecture

Marks CO Bloom’s
Qn
Question Knowledge
No
Level
1 Define human resource management (HRM). 2 Marks CO3 Remembering
2 Describe the role of HR in managing workplace diversity. 6 Marks CO3 Understanding

3 Explain the key components of an effective employee 8 Marks CO3 Remembering

orientation program.
4. Discuss the importance of succession planning in 13 Marks CO3 Understanding
organizations. Outline the steps involved in developing a
succession plan.
 Lecture
Unit3 HUMAN RESOURCE MANAGEMENT
2
Topics Objectives of HRM
Bloom’s
Learning Outcome (LO) At the end of this lecture, students will be able to
Knowledge Level
LO1 Understand the Core Objectives of HRM Understanding
LO2 Analyze HRM’s Role in Organizational Success Analyze

Societal objective to be socially responsible to the needs and challenges of society while
minimizing the negative impact of such demands upon the organization. The failure of
organizations to use their resources for society's benefit may result in restrictions. For example,
societies may pass laws that limit human resource decisions.

Organizational objective to recognize that HRM exists to contribute to organizational

effectiveness. HRM is not an end in itself; it is only a means to assist the organization with its
primary objectives. Simply stated, the department exists to serve the rest of the organization
functional objective. To maintain the department's contribution at a level appropriate to the
organization’s needs. Resources are wasted when HRM is more or less sophisticated than the
organization demands. A department's level of service must be appropriate for the organization it
serves.
Personal objective to assist employees in achieving their personal goals, at least insofar as these
goals enhance the individual's contribution to the organization. Personal objectives of employees
must be met if workers are to be maintained, retained and motivated. Otherwise, employee
performance and satisfaction may decline, and employees may leave the organization.

Nature of Human Resource Management

Human Resource Management involves management functions like planning, organizing,

directing and controlling.

• It involves procurement, development, maintenance of human resource

• It helps to achieve individual, organizational and social objectives
• Human Resource Management is a multidisciplinary subject. It includes the study of
management, psychology, communication, economics and sociology.
• It involves team spirit and team work.
• It is a continuous process.
HR manager

The Human Resource Manager is a mid-level position responsible for overseeing human
resources activities and policies according to executive level direction. They supervise human
resources staff as well as control compensation and benefits, employee relations, staffing,
training, safety, labor relations,
and employment records.
Key responsibilities of Human Resource Manager
Human Resource Manager is one of the most important key to open a lock hanging on the door
of success in an organization. If an Human Resource Manager is efficient enough to handle and
to take out best from his team members any organization and can achieve more from his target
goals. Human Resource manager plays a very important role in hierarchy, and also in between
the higher management and low level employees. Stated below are major responsibilities of
Human Resource Manager:-

Scope of Human Resource Management

The scope of Human Resource Management refers to all the activities that come under the
banner of Human Resource Management. These activities are as follows.

Human resources planning: Human resource planning or Human Resource Planning refers to a
process by which the company to identify the number of jobs vacant, whether the company has
excess staff or shortage of staff and to deal with this excess or shortage.
Job analysis design: Another important area of Human Resource Management is job analysis.
Job analysis gives a detailed explanation about each and every job in the company.
Recruitment and selection: Based on information collected from job analysis the company prepares
advertisements and publishes them in the newspapers. This is recruitment. A number of applications are
received after the advertisement is published, interviews are conducted and the right employee is selected
thus recruitment and selection are yet another important area of Human Resource Management.

Orientation and induction: Once the employees have been selected an induction or orientation
program is conducted. This is another important area of Human Resource Management. The
employees are informed about the background of the company, explain about the organizational
culture and values and work ethics and introduce to the other employees.
Training and development: Every employee goes under training program which helps him to
put up a better performance on the job. Training program is also conducted for existing staff that
have a lot of experience. This is called refresher training. Training and development is one area
where the company spends a huge amount.
Performance appraisal: Once the employee has put in around 1 year of service, performance
appraisal is conducted that is the Human Resource department checks the performance of the
employee. Based on these appraisal future promotions, incentives, increments in salary are
decided.
Compensation planning and remuneration: There are various rules regarding compensation
and other benefits. It is the job of the Human Resource department to look into remuneration and
compensation planning.
Motivation, welfare, health and safety: Motivation becomes important to sustain the number of
employees in the company. It is the job of the Human Resource department to look into the
different methods of motivation. Apart from this certain health and safety regulations have to be
followed for the benefits of the employees. This is also handled by the HR department.
Industrial relations: Another important area of Human Resource Management is maintaining
co-ordinal relations with the union members. This will help the organization to prevent strikes
lockouts and ensure smooth working in the company.
Assessment questions to the lecture

Qn Bloom’s
Question Answer
No KnowledgeLevel
1 What is one of the primary objectives of Correct Answer: Understanding
HRM? B. Ensuring
A. Maximizing profits compliance with
regulations
B. Ensuring compliance with regulations
C. Reducing employee training costs
D. Increasing marketing efforts
2 Which HRM objective seeks to align Correct Answer: Understanding
employee goals with organizational goals?
A. Employee retention B. Strategic
B. Strategic planning planning
C. Talent acquisition
D. Compensation management

3 Which of the following actives of CorrectAnswer: Remembering

HRM aims to enhance employee D.All of the above
performance?
A. Cost reduction
B. Employee motivation
C. Job satisfaction
D. All of the above
 Students have to prepare answers for the following questions at the end of the lecture

Marks CO Bloom’s
Qn
Question Knowledge
No
Level
1 How does HRM contribute to organizational productivity? 2 Marks CO3 Remembering
2 Describe the objective of HRM focused on employee 6 Marks CO3 Understanding
retention and its impact on an organization.
3 Explain how HRM objectives can help organizations manage 8 Marks CO3 Remembering
change effectively.
4. Discuss the role of HRM in developing a strategic approach 13 Marks CO3 Understanding
to human capital management. How do its objectives support
long-term business goals?

Lecture
Unit3 HUMAN RESOURCE MANAGEMENT
3
Topics Personnel Management
Bloom’s
Learning Outcome (LO) At the end of this lecture, students will be able to
Knowledge Level
LO1 Understanding Key Functions Understanding
LO2 Application of Concepts Apply

Personnel Management

Personnel Management is basically an administrative record-keeping function, at the operational

level. Personnel Management attempts to maintain fair terms and conditions of employment,
while at the same time, efficiently managing personnel activities for individual departments etc.
It is assumed that the outcomes from providing justice and achieving efficiency in the
management of personnel activities will result ultimately in achieving organizational success.
Defines personnel management as the planning, organizing, and controlling of the procurement,
development, compensation, integration and maintenance of people for the purpose of
contributing to the organizational goals.

Personal management versus Human resource management:

HRM has a long history of growing from a simple welfare and maintenance function to that of a
board level activity of the companies. In recent years, the focus on people management from
human capital/intellectual capital perspective is also shaping firmly. However, the hard fact is
that this growth can be generally witnessed in management literature and rarely in practice.
Peripheral observation of people management in organization can mislead the observers since;
hardly there could be any organization that is yet to rename its old fashioned title of industrial
relations/ personnel /welfare/ administration department into HRM department. But, in practice,
these organizations continue to handle the people management activities the way they had been
handling earlier. The reasons for this could be many and varied. Among them, the potential
reason is lack of clear understanding about the differences between personnel/IR and HRM

BASIS FOR COMPARISON PERSONNEL HUMAN RESOURCE

MANAGEMENT MANAGEMENT

Meaning The aspect of management that is The branch of management that

concerned with the work force focuses on the most effective use
and their relationship with the of the manpower of an entity, to
entity is known as Personnel achieve the organizational goals
Management. is known as Human Resource
Management.

Approach Traditional Modern

Treatment of manpower Machines or Tools Asset

Type of function Routine function Strategic function

Basis of Pay Job Evaluation Performance Evaluation

Management Role Transactional Transformational

Communication Indirect Direct

Labor Management Collective Bargaining Contracts Individual Contracts

Initiatives Piecemeal Integrated

Management Actions Procedure Business needs

Decision Making Slow Fast

Job Design Division of Labor Groups/Teams

1. Personnel management function is often viewed as a function of the specialized staff.

2. Human resource management function is the responsibility of all the line managers in the
organization. Personnel management goal is employee orientation.
3. Human resource management goal is organization orientation
4. Personnel management managerial function
5. Human resource management operative function
6. Personnel management cooperative level manager concern
7. Human resource management top level manager concern.
Personnel Management and Industrial Relations:
The word personnel management is popular with different names, such as staff management,
labor management, manpower management, industrial relations and modern times as human
resources management. Industrial relations refer to the relation between the employees and
management.

Features in Personnel Management:

Personnel management is concerned with managing people at all level in the
organization
It is concerned with employees both as individuals and as a group
It is a method of helping the employees to identify and develop their potential.
It is a method of channelizing this potential for the attainment of organizational goals.
It is required in very organization, in the form of the services of the personnel manager.
Characteristics of personnel management:

Maximum individual development: This principle stresses on the development of every person
working in an organization. Workers are able to fulfill the objectives of an organization with the
minimum cost. Hence, the employees in the organization should be properly developed. By this,
employees will be able to develop themselves to the maximum extent of their capabilities. Their
ability, productivity and efficiency can be used for achieving the objectives of the organization.
Scientific selection: For the proper co-ordination between work and workers, it is necessary to
select the right person for the right job. Workers should be selected after a careful weighing of
the requirements of the jobs on the other hand, and assessment and evaluation of the abilities and
attitudes of man on the other.
High morale: It is necessary to have high morale among the workers in an organization. For this
purpose, ideal wage policy should be offered in the organization. Workers should be motivated
by monetary and non-monetary incentives.

Dignity of labor: Human resource management specially act, so that the workers feel proud of
their work or labor. Sometimes, like ‗work is worship‘ notion should be developed in workers.
This principle requires treating every job and every jobholder with dignity and respect.

Team spirit: Team spirit must be developed in the workers. They should work collectively and
they should feel collective responsibility for the attainment of the objectives of the organization.
For this purpose, workers must have the sense of cooperation, unity and mutual trust.

Effective communication: There must be effective channel of communication between the

management and the workers. The orders of higher authorities should reach the workers, while
worker‘s request and grievances should reach the higher authorities in a proper way. If
communication system is not effective, then there will arise complex problem like mistrust,
hatred and ill-will, and this in turn affects the production of the organization.

Fair remuneration: Labor should be given fair and proper compensation for the work they
rendered. They should also be given fair incentives or rewards to recognize good performance.
This develops industrial peace.

Effective utilization of human resources: The skills and abilities of human resources should be
effectively utilized. Proper training facilities should be provided to workers. Human resource
management is an art to get the work done by the people, to get the desired result. For this
employees should be given humanly treatment in the organization.

Participation: This principle emphasizes the idea of labor participation in the management of
the enterprise. Workers participation in management aims at increasing productivity of labor by
improving co-operation between employer and employees.

Contribution to national prosperity: This principle stresses to provide a higher purpose of

work to all employees and to contribute to national prosperity. For this purpose, human resource
management should develop the sense of participation in labor to make them realize that their
efforts alone can contribute to the prosperity of the organization and of the country
Assessment questions to the lecture

Q Bloom’s
Question Answer
n Knowledge Level
N
o
1 Which of the following is a key function of Correct Answer: Understanding
personnel management? C. Recruitment and
A. Financial planning selection

B. Market research
C. Recruitment and selection
D. Production scheduling
2 What is the primary objective of personnel Correct nswer: Understanding
management?
A. Increase profits C. Efficiently
B. Maximize employee satisfaction manage
workforce
C. Efficiently manage workforce
D. Improve company reputation

3 Performance appraisals are used Correct Answer: Remembering

to
B. Evaluate
employee
performance
A. Determine employee
pay scales
B. Evaluate employee
performance
C. Recruit new
employees
D. Plan marketing
strategies
 Students have to prepare answers for the following questions at the end of the lecture

Marks CO Bloom’s
Qn
Question Knowledge
No
Level
1 Define job analysis in personnel management. 2 Marks CO3 Remembering
2 6 Marks CO3 Understanding
Explain the importance of employee training and
development in an organization.
3 What are the key functions of personnel management? 8 Marks CO3 Remembering
Discuss each briefly.
4. Discuss the various methods of employee training and 13 Marks CO3 Understanding
development. Evaluate the pros and cons of each
method in relation to organizational needs.

Lecture
Unit3 HUMAN RESOURCE MANAGEMENT
4
Topics Human Resource Development

Bloom’s
Learning Outcome (LO) At the end of this lecture, students will be able to
Knowledge Level
LO1 Understanding HRD Concepts and Practices Understanding
LO2 Application of HRD in Organizational Settings Apply

Human Resource Development

Human Resource Development is the part of human resource management that specifically deals
with training and development of the employees in the organization. Human resource
development includes training a person after he or she is first hired, providing opportunities to
learn new skills, distributing resources that are beneficial for the employee's tasks, and any other
developmental activities.

INTRODUCTION
Development of human resources is essential for any organization that would like to be
dynamic and growth-oriented. Unlike other resources, human resources have rather unlimited
potential capabilities. The potential can be used only by creating a climate that can continuously
identify, bring to surface, nurture and use the capabilities of people.
Human Resource Development (HRD) system aims at creating such a climate. A number of
HRD techniques have been developed in recent years to perform the above task based on certain
principles. This unit provides an understanding of the concept of HRD system, related
mechanisms and the changing boundaries of HRD.
HRD concept was first introduced by Leonard Nadler in 1969 in a conference in US. ―He
defined HRD as those learning experience which are organized, for a specific time, and designed
to bring about the possibility of behavioral change.
Human Resource Development (HRD) is the framework for helping employees develops their
personal and organizational skills, knowledge, and abilities. Human Resource Development
includes such opportunities as employee training, employee career development, performance
management and development, coaching, mentoring, succession planning, key employee
identification, tuition assistance, and organization development.
The focus of all aspects of Human Resource Development is on developing the most superior
workforce so that the organization and individual employees can accomplish their work goals in
service to customers.
Human Resource Development can be formal such as in classroom training, a college course, or
an organizational planned change effort. Or, Human Resource Development can be informal as
in employee coaching by a manager. Healthy organizations believe in Human Resource
Development and cover all of these bases.
Definitions of HRD
HRD (Human Resources Development) has been defined by various scholars in various ways.
Some of the important definitions of HRD (Human Resources Development) are as follows:
❖ According to Leonard Nadler, "Human resource development is a series of organized
activities, conducted within a specialized time and designed to produce behavioral
changes."
❖ In the words of Prof. T.V. Rao, "HRD is a process by which the employees of an
organization are helped in a continuous and planned way to (i) acquire or sharpen
capabilities required to perform various functions associated with their present or
expected future roles; (ii) develop their journal capabilities as individual and discover and
exploit their own inner potential for their own and /or organizational development
purposes; (iii) develop an organizational culture in which superior-subordinate
relationship, team work and collaboration among sub-units are strong and contribute to
the professional well being, motivation and pride of employees." .
 ❖ According to M.M. Khan, "Human resource development is the across of increasing
knowledge, capabilities and positive work attitudes of all people working at all levels in a
business undertaking."

THE CONCEPT OF HUMAN RESOURCE DEVELOPMENT

Human resource development in the organization context is a process by which the employees of
an organization are helped, in a continuous and planned way to:
• Acquire or sharpen capabilities required to perform various functions associated with
their present or expected future roles;
• Develop their general capabilities as individuals and discover and exploit their own inner
potentials for their own and/or organizational development purposes;
• Develop an organizational culture in which supervisor-subordinate relationships,
teamwork and collaboration among sub-units are strong and contribute to the professional
well being, motivation and pride of employees.
This definition of HRD is limited to the organizational context. In the context of a state or nation
it would differ.

HRD is a process, not merely a set of mechanisms and techniques. The mechanisms and
techniques such as performance appraisal, counseling, training, and organization development
interventions are used to initiate, facilitate, and promote this process in a continuous way.
Because the process has no limit, the mechanisms may need to be examined periodically to see
whether they are promoting or hindering the process. Organizations can facilitate this process of
development by planning for it, by allocating organizational resources for the purpose, and by
exemplifying an HRD philosophy that values human beings and promotes their development.

Difference between HRD and HRM

Both are very important concepts of management specifically related with human resources of
organization. Human resource management and human resource development can be
differentiated on the following grounds:
❖ The human resource management is mainly maintenance oriented whereas human
resource development is development oriented.
❖ Organization structure in case of human resources management is independent
whereas human resource development creates a structure, which is inter-
dependent and inter-related.
❖ Human resource management mainly aims to improve the efficiency of the
employees whereas aims at the development of the employees as well as
organization as a whole.
❖ Responsibility of human resource development is given to the personnel/human
resource management department and specifically to personnel manager whereas
responsibility of HRD is given to all managers at various levels of the
organization.
 ❖ HRM motivates the employees by giving them monetary incentives or rewards
whereas human resource development stresses on motivating people by satisfying
higher-order needs.

THE NEED FOR HRD

HRD is needed by any organization that wants to be dynamic and growth-oriented or to
succeed in a fast-changing environment. Organizations can become dynamic and grow only
through the efforts and competencies of their human resources. Personnel policies can keep the
morale and motivation of employees high, but these efforts are not enough to make the
organization dynamic and take it in new directions. Employee capabilities must continuously be
acquired, sharpened, and used. For this purpose, an ―enabling‖ organizational culture is
essential. When employees use their initiative, take risks, experiment, innovate, and make things
happen, the organization may be said to have an ―enabling‖ culture.
Even an organization that has reached its limit of growth, needs to adapt to the changing
environment. No organization is immune to the need for processes that help to acquire and
increase its capabilities for stability and renewal.

HRD FUNCTIONS
The core of the concept of HRS is that of development of human beings, or HRD. The
concept of development should cover not only the individual but also other units in the
organization. In addition to developing the individual, attention needs to be given to the
development of stronger dyads, i.e., two person groups of the employee and his boss. Such dyads
are the basic units of working in the organization. Besides several groups like committees, task
groups, etc. also require attention. Development of such groups should be from the point of view
of increasing collaboration amongst people working in the organization, thus making for an
effective decision-making. Finally, the entire department and the entire organization also should
be covered by development. Their development would involve developing a climate conducive
for their effectiveness, developing self-renewing mechanisms in the organizations so that they
are able to adjust and pro-act, and developing relevant processes which contribute to their
effectiveness.

Hence, the goals of the HRD systems are to develop:

❖ The capabilities of each employee as an individual.
❖ The capabilities of each individual in relation to his or her present role.
❖ The capabilities of each employee in relation to his or her expected future role(s).
❖ The dyadic relationship between each employee and his or her supervisor.
❖ The team spirit and functioning in every organizational unit (department, group,
etc.).
❖ Collaboration among different units of the organization.
 ❖ The organization’s overall health and self-renewing capabilities which, in turn,
increase the enabling capabilities of individuals, dyads, teams, and the entire
organization.

Features of Human Resource development

The essential features of human resource development can be listed as follows:

❖ Human resource development is a process in which employees of the organizations are

recognized as its human resource. It believes that human resource is most valuable asset of
the organization.
❖ It stresses on development of human resources of the organisation. It helps the employees
of the organisation to develop their general capabilities in relation to their present jobs
and expected future role.
❖ It emphasize on the development and best utilization of the capabilities of individuals in
the interest of the employees and organisation.
❖ It helps is establishing/developing better inter-personal relations. It stresses on
developing relationship based on help, trust and confidence.
❖ It promotes team spirit among employees.
❖ It tries to develop competencies at the organisation level. It stresses on providing healthy
climate for development in the organisation.
❖ HRD is a system. It has several sub-systems. All these sub-systems are inter-related and
interwoven. It stresses on collaboration among all the sub-systems.
❖ It aims to develop an organisational culture in which there is good senior-subordinate
relations, motivation, quality and sense of belonging.
❖ It tries to develop competence at individual, inter-personal, group and organisational
level to meet organisational goal.
❖ It is an inter-disciplinary concept. It is based on the concepts, ideas and principles of
sociology, psychology, economics etc.
❖ It form on employee welfare and quality of work life. It tries to examine/identify
employee needs and meeting them to the best possible extent.
❖ It is a continuous and systematic learning process. Development is a life long process,
which never ends.

Benefits of Human Resource Development

Human resource development now a days is considered as the key to higher productivity,
better relations and greater profitability for any organisation. Appropriate HRD provides
unlimited benefits to the concerned organisation. Some of the important benefits are being given
here:
❖ HRD (Human Resource Development) makes people more competent. HRD
develops new skill, knowledge and attitude of the people in the concern
organisations.
❖ With appropriate HRD programme, people become more committed to their jobs.
People are assessed on the basis of their performance by having a acceptable
performance appraisal system.
❖ An environment of trust and respect can be created with the help of human
resource development.
❖ Acceptability toward change can be created with the help of HRD. Employees
found themselves better equipped with problem-solving capabilities.
❖ It improves the all round growth of the employees. HRD also improves team spirit
in the organisation. They become more open in their behavior. Thus, new values
can be generated.
❖ It also helps to create the efficiency culture In the organisation. It leads to greater
organisational effectiveness. Resources are properly utilized and goals are
achieved in a better way.
❖ It improves the participation of worker in the organisation. This improves the role
of worker and workers feel a sense of pride and achievement while performing
their jobs.
❖ It also helps to collect useful and objective data on employees programmes and
policies which further facilitate better human resource planning.
❖ Hence, it can be concluded that HRD provides a lot of benefits in every
organisation. So, the importance of concept of HRD should be recognized and
given a place of eminence, to face the present and future challenges in the
organisation.
 Assessment questions to the lecture

Qn.no Bloom’s
Question Answer
Knowledge Level

1 Which of the following is NOT a component of Correct Answer: Understanding

HRD?
C. Recruitment and
A. Training and development selection

B. Organizational development
C. Recruitment and selection
D. Performance management
2 What is the purpose of performance appraisal Correct nswer: Understanding
in HRD?
A. To punish poor performance B. To provide
B. To provide feedback for employee feedback for
development employee
development
C. To determine promotions
D. To assess organizational culture

3 Which of the following is a key Correct Answer: Remembering

characteristic of a learning
organization? C. Continuous
learning and
adaptation
A. Hierarchical structure A.
B. Emphasis on individual
performance
C. Continuous learning and B.
adaptation
D. Resistance to change C.
 Students have to prepare answers for the following questions at the end of the lecture

Marks CO Bloom’s
Qn
Question Knowledge
No
Level
1 What is the purpose of a training needs analysis? 2 Marks CO3 Remembering

2 Explain the key elements of a successful training program. 6 Marks CO3 Understanding

3 Describe the steps involved in the succession planning 8 Marks CO3 Remembering
process.
4. Discuss the challenges of implementing an effective Human 13 Marks CO3 Understanding
Resource Development program in an organization.

Lecture
Unit3 HUMAN RESOURCE MANAGEMENT
5
Topics Functions of HRM

Bloom’s
Learning Outcome (LO) At the end of this lecture, students will be able to
Knowledge Level
LO1 Understand the Core Functions of HRM Understanding

LO2 Apply HRM Functions to Organizational Scenarios Apply

Functions of human resource Management:

Managerial Function Operative Functions

Planning Procurement of personnel

Organizing Development of personnel

Staffing Compensation of personnel

Motivating Employees benefits schemes

Controlling Maintaining good industrial relations Record keeping Personnel
planning and evaluation Personnel research and audit

Managerial Function:

Planning: It is concerned with manpower planning

1. To forecast future vacancies
2. To anticipate retirements promotions and transfer
3. Preparing job analysis, job description and job specifications
4. Analyzing resources of potential employees

Organizing: It is concerned with organizing manpower

1. To analysis organization structure
2. Recommending organizational changes
3. To analyze applications and determine suitability of candidates
4. Interviewing conducting test
5. Investigating references
6. Arranging medical examination

Staffing: Staffing comprises these is functions induction, transfer/promotion, Manpower

development and training.
Induction: To ensure new recruits are provided with appropriate training,
1. Orienting new employees into their jobs
2. Reviewing their performances
3. Ascertaining training requirements

Transfer/Promotion: To utilize employees enhanced capabilities

1. Continuously analyzing job description
2. Evaluating employee qualification/performance
3. Determining further training requirement

Manpower development: To provide individual employees development

1. Developing performance standards
2. Appraising performance
3. Planning individual development program

Training: It includes the followings

1. Conducting training program
2. Evaluating training results
Motivating: Motivating comprises these are the functions payment recreation, communication,
health and safety.

Payment: To set pay scales for different job positions and considering pay scales in other
organization
1. Analyzing jobs as per job description
2. Evaluating such jobs
3. Develop scales

Recreation: To provide facilities for enjoyment

1. Conducting social activities
2. Sports and games
3. Recreational activities

Communication: To provide needed exchange of information throughout the

organization.

1. Developing channels and media of information system

2. Introducing suggestion scheme
3. Conducting opinion surveys

Health and safety: Prevent diseases and provide security measures

1. Providing medical facilities
2. Providing safety measures

Controlling: Controlling comprises these is the functions performances appraisal, security,

employees ‘attitude and coordination.

Performance appraisal: To appraise performance as per their duties and responsibilities

1. Developing performance evaluating system
2. Conducting performance evaluating interviews
3. Analyzing evaluation results

Security: To provide precautionary measure to prevent theft, fire etc.

1. To develop and implement security measures
2. To provide watchman
3. To organize fire fighting training

Employee attitude and coordination: To improve employees attitude and coordination of

work.
1. Analyzing personal problems arrange consulting
2. Implement improved practices
Operative Functions:
Procurement of personnel: It deal with determination of man power requirement, their
recruitment, selection, placement and orientation
Development of personnel: After personnel have been obtained, they must to some
degree be developed before going to work. Development has to do with the increase of skill,
through training that is necessary for proper job performance.
Compensation of personnel: Compensation means, determination of adequate and
equitable remuneration of personnel for their contribution to organization objectives.
Record keeping: In this system personnel manager collets and maintain information
which is concerned with the staff of the organization
Personnel planning and evaluation: Under this system different types of activities are
evaluated such as evaluation of performances personnel policy of an organization and its
practices, personnel audit, moral survey and performance appraisal etc.
Personnel research and audit: This function is concerned with the research in
motivational techniques and auditing.
Job Analysis:
Job analysis can be defined as the process of identifying the tasks comprising a particular
job to assess whether they could be organized in a productive manner. This will identify the main
features of the job, the major tasks undertaken, the results to be achieved, and how one job is
related to the other jobs in the organizational hierarchy. The product of job analysis is job
description.
Job Description:
Job description is an accurate and concise description of (a) the overall purposes of the
job (b) the principal duties of the person doing this job. The job description emphasizes the job
requirements. Clear job description constitutes the basis for advertising the vacancy positions
and for drawing up job specifications. Once individuals are selected to the posts, job description
allows them to know exactly what their roles are and what is expected of them.
Job Specification
Job specification identifies the requirements on the part of the person to perform the
given job. It provides the interviewer an understanding of the job and helps him to assess the
qualities necessary for its performance to an acceptable standard, at the time of interview. This
helps him to compare the performance of candidates objectively and to eliminate unsuitable
candidates.

Manpower Planning:
It is the scientific process of evolving the right quantity of right men to be required in
future at right time on the right job.

Definition: Manpower planning may be defined as a rational method of assessing the

requirements of human resources at different levels in the organization. It ends with proposals
for recruitment, retention, or even dismissal, where necessary.
Objectives of Manpower Planning:

• Making correct estimate of manpower requirement

• Managing the manpower according to the need of enterprises

• Helps in recruitment and selection

• Maintaining production level

• Making employees development programme effecting

• Establishing industrial peace

• Reduction in labour costs

• Minimization of labour costs.

Recruitment:

Applications are invited at this stage for further scrutiny and short listing. Before
advertising for the position, it common to check up of the position could be filled in internally.

Selection:
The process of identifying the most suitable persons for the organization is called
selection. Selection is also called a negative function because at a stage the applications are
screened and short-listed based on the selection criteria. The main purpose of selection is to
choose the right person for the right job. The job analysis, job description, and job specifications
are carried out before the position is advertised. These provide adequate insight about nature of
the job, its description, and its specifications and further focus on what type of person is to be
selected for a given position. These simplify the process of selection.

Selection process involves the following stages:

• Initial screening/Short listing

• Comprehensive application/bio data screening

• Aptitude or written rests

• Group discussion

• Personal interviews
 • Group discussion

• Personal interviews

• Medical examination

• Employment offer letter

Assessment questions to the lecture

Qn.no Bloom’s
Question Answer
Knowledge Level
1 What is one of the primary functions of Human Correct Answer: Understanding
Resources?
C. Recruitment and
A. Marketing selection
B. Recruitment and Selection
C. Financial Management
D. Production Planning
2 Which of the following is NOT a function of Correct nswer: Understanding
HR?
A. Employee Relations B. To provide
B. Payroll Management feedback for
C. Product Development employee
development
D. Training and Development

3 Which of the following is a key Correct Answer: Remembering

characteristic of a learning
organization? C. Continuous
A. Continuous improvement and learning and
adaptation adaptation
B. Strict hierarchical structure
C. Resistance to change
D. Focus solely on profit
D.
E.
F.
 Students have to prepare answers for the following questions at the end of the lecture

Marks CO Bloom’s
Qn
Question Knowledge
No
Level
1 What are two key functions of HRM? 2 Marks CO3 Remembering

2 Explain three functions of HRM in brief. 6 Marks CO3 Understanding

3 Discuss four major functions of HRM and their importance. 8 Marks CO3 Remembering

4. Describe the key functions of HRM in detail and discuss 13 Marks CO3 Understanding
their significance in organizational success.

Lecture
Unit3 HUMAN RESOURCE MANAGEMENT
6
Topics Training and Development

Bloom’s
Learning Outcome (LO) At the end of this lecture, students will be able to
Knowledge Level
LO1 Understanding the Key Concepts and Processes in Training and Understanding
Development
LO2 Analyzing the Impact of Training on Organizational Analyzing
Performance

Training and development

Training: Training is short-term process of utilizing systematic and organized procedure by

which the staff acquires specific technical knowledge and functional skills for a definite purpose.
The focus of training is the job or task.

Training Needs:

• High turnover among the new recruits

• Increase in wastage of materials

 • Increase in the number of rejected units of production

• Increase in the number of customer complaints

• Increase in the accident rate

• Reduced productivity levels

• Increase in machine breakdowns

Methods of Training: There are two methods of training

On-the job training

Off-the job training

On-the job training: It is designed to make the employees immediately productive. It is learning
by physically doing the work. The focus here is to provide specific skills in a real situation.
These methods include:
Job instruction training: This is a method used for such jobs which can be performed with
relatively low skill. Here, the trainees systematically acquire skills by following routine
instructions in key processes from a qualified instructor.
Experiential learning: This is a modern approach to the learning process. This method is more
used for training the senior executives. It is a technique, which empowers the manager-trainee
with the freedom of choice to act upon and the capacity to initiate, rather than simply respond, to
circumstances.
Demonstration: Here, the work procedures are demonstrated to the trainees. Each of the trainees is
asked to carry out the work, on a sample basis, based on his/her observation and understanding of the
demonstration.
Apprentice training: Those who are selected to work in the shop floor are trained as apprentices in
the factory for a brief period ranging from three months to one year, depending upon the complexity
of the training. Those who show good progress in this training are likely to be absorbed in the same
organization. Those who complete apprentice training are likely to get good jobs outside also.

Off-the-job training methods: provide a relatively broad idea relating to a given job or task.
These are meant for developing an understanding of general principles, providing background
knowledge, or generating an awareness of comparative ideas and practice. These methods
include:

Lectures/talks and class room instructions: These techniques are designed to communicate
specific interpersonal, technical, or problem-solving skills. Here, the trainer can maintain a tight
control over learning. However, this method restricts the trainee's freedom to develop his/her own
approaches to learning.

Conferences: Conferences refer to get-together of the experts from different areas of a given topic.
These experts present their views based on their work experience and research results. When
employees participate in such events they get a feel of the real world. They may also get motivated to
perform better.

Seminars: Seminars are held periodically by the professional organisations for the benefit of all the
practicing managers by taking into consideration the recent advances in a specialized area.
Participation in such seminars enables the executives to get exposed to the recent developments in
the area of their interest.

Team discussions: This technique develops team spirit among the executives from different
departments. It also enables them to understand and appreciate each other's problems. It reinforces a
feeling of unity among those who work towards common goals.
Case study: This is a predominant technique followed even in premier management institutes. This
technique helps to provide an understanding of what has gone wrong in a particular case, such as
Delhi Cloth Mills (DCM). Similarly, what are the factors responsible for the success of organizations
such as Reliance or Hindustan Lever. Case study technique is a very good method of learning the
principles and concepts. However, this method has one weakness. The circumstances you are likely
to face in your life may be very different from the cases you have analyzed earlier! Case studies help
to enhance the analytical & decision making skills.

Role-playing: The participants are assigned roles and are asked to react to one another, as they
would do in their managerial jobs. These roles are eventually exchanged. In other words, each
participant will get a turn to play all the roles. For instance, the role-playing in a grievance-handling
situation involves two players: In the first step, the worker presents his grievance to the personnel
manager. In the second step, the worker plays the role of the personnel manager while the personnel
manager plays the role of the worker. Role-playing allows participants to understand problems of
each other. It enhances the interpersonal-handling skills.

Programmed instruction: It is a system of instruction within which pre-established subject matter is

broken into small, discrete steps and carefully organized into logical sequence in which, it can be
learned by the trainee. Each step is built upon the previous one. The programmed instruction
techniques can be in the form of programmed tests and manuals, or video displays. For instance,
withdrawal of money through automatic teller machines (ATMs) involves responding to programmed
instructions; working on a personal computer or internet involves responding to a series of
programmed instructions.

Simulation exercises: These include interactive exercises in which trainees practice their skills on
working models or in mock situations based on real-life situations.
Group decision-making: Group decision-making refers to the process of making decisions based on
the opinions expressed by all the concerned — may be subordinates, peers, or outside consultants.
The manager thus ensures that more people are involved in taking decisions. Each member of the
group will accept the responsibility for the decisions made as he is a party to it. This method
facilitates to generate more alternative solutions to a given problem because more people are
involved in the thinking exercise. This facilitates coordination among the groups also.

Development: Development is an activity aimed at career growth rather than immediate

performance. Employee development is the process, which helps him or her to understand and
interpret knowledge rather than teaching a specific set of functional skills. Development,
therefore, focuses more on employee's personal growth in the near future.
Placement: After training, the employee is placed in his/her position under the charge of a
manager. The new recruit is allowed to exercise full authority and is held responsible for the
results.

Promotion: Promotion refers to the advancement of an employee to a job with a higher authority
and responsibility. It may also carry a better compensation package. Promotion can also be
viewed as a means of filling up vacancies in the organization occurring from time to time.

Demotion: Where an employee is not in a position to perform a given job, he may be demoted or
transferred to a position with a lower authority and salary. In other words, demotion is a
punishment.

Transfer: It is a lateral shift that moves an individual employee from one position to another. It
may be in the same department, or to a different department or location. This does not involve
any changes in the duties, responsibilities, or skills needed. The salary benefits also may remain
the same.

Separation: Separation refers to termination of employment. In other words, the employee is

separated from his job. In case of misconduct or misbehavior, where the employee is not in a
position to improve his performance despite notice, his/her employment is terminated. This is
also called dismissal.

Absenteeism: Absenteeism refers to the practice of an employee who does not report to work for
any particular reason. Absenteeism affects the productivity adversely. It becomes difficult for the
departments to cope up with the work pressures, if any particular employee is absent. As a
measure of control, the employees are not allowed to be absent without prior permission from the
management.
Assessment questions to the lecture

Qn Bloom’s
Question Answer
No KnowledgeLevel

1 Which of the following is a Correct Answer:

method of on-the-job training?
A. Classroom training C. Job rotation
B. Simulation exercises
C. Job rotation
E.E-learning

2 Which type of training focuses on Correct Answer:

improving specific skills for a
particular job? B) Skills-based
A) General training training
B) Skills-based training
C) Induction training
D) Management training

3 What is the primary goal of Correct Answer:

training in an organization?
A) Increase employee turnover
B) Enhance employee performance B) Enhance employee
C) Reduce operational costs performance
D) Improve company image
 Students have to prepare answers for the following questions at the end of the lecture

Marks CO Bloom’s
Qn
Question Knowledge
No
Level
1 What is the difference between training and 2 Marks CO3 Remembering
development?

2 Explain the significance of a needs assessment in 6 Marks CO3 Understanding

training and development.

3 Discuss the steps involved in the ADDIE model of 8 Marks CO3 Remembering
instructional design.
.
4. Analyze the role of training and development in 13 Marks CO3 Understanding
enhancing organizational performance.

Lecture
Unit3 HUMAN RESOURCE MANAGEMENT
7
Topics Features of grievance

Bloom’s
Learning Outcome (LO) At the end of this lecture, students will be able to
Knowledge Level
LO1 Understanding the nature and characteristics of grievances Understanding

LO2 Ability to evaluate the impact of grievances on organizational Evaluating

performance

Wages and Salary Administration: Wages and salary administration is the process of fixing
wages/salary for different jobs in the organization through job evaluation, negotiations with the
unions, and so on.

Grievance Handling:
A complaint from employees, when ignored, takes the form of a grievance. Grievance is
a complaint genuine or otherwise, about any issue relating to the job such as about supervisor,
wages, working conditions and so on. It is necessary to create an in-build mechanism to redress
the grievances, at the earliest, at the departmental level. If the individual grievances are ignored,
they may take the form of industrial disputes.
Here are some features of grievance

Clear communication: The grievance process should be communicated clearly to employees.

Accessibility: Employees should be able to easily file grievances.

Fairness: Grievances should be handled fairly.

Confidentiality: The privacy of those involved should be protected.

Structured process: The grievance process should be structured with clear timeframes.

Training: Managers and HR should be trained.

Quick handling: Grievances should be handled as quickly as possible after they are reported.

Established procedure: There should be a set grievance management procedure for managers to
use.

Policies and protocols: Grievance management should ensure that proper policies and protocols
are put in place to prevent similar issues in the future.

Open door policy: Employees should feel comfortable approaching any manager with
grievances, complaints, suggestions, or questions.

Mediation and conciliation: Mediation and informal negotiation should be part of the grievance
process.

Appeals: Employees should be able to appeal decisions or take other alternative actions.

Performance Appraisal:
Performance appraisal is the process of measuring and evaluating the performance or
accomplishments, including behavior, of an employee on the job front for a given period. The
purpose is to assess the worth and value of a person to the organization. It is also meant for
assessing his/her potential for future development in an objective manner.

Why appraise the performance?

➢ To assess the employee's present level of performance

 ➢ To identify the strengths or weaknesses of individual employee

➢ To provide feedback to the employee so that he can improve his/her performance

➢ To provide an objective basis for rewarding the employees for their performance

➢ To motivate those employees who perform

➢ To check and punish those employees who fail to perform

➢ To identify the gaps in performance, and thus, assess training and development needs

➢ To identify the employee's potential to perform

➢ To provide a database for evolving succession strategies

➢ To provide a basis for many other decisions such as fixation of incentives or increment,
regularization or confirmation of the services of the employee, promotion, transfer or
demotion.

Steps in performance Appraisal:

➢ Create set up performance standards

➢ Mutually set identifiable and measurable

➢ Measure present level of performance

➢ Compare and appraise present level of performance with standard

➢ Discuss the appraisal with employee

➢ Identify and initiate the corrective action

Assessment questions to the lecture

Qn Bloom’s
Question Answer
No KnowledgeLevel

1 Which feature of a grievance Correct Answer:

process helps ensure fairness?
A) Informal discussions
B) Confidentiality B) Confidentiality
C) Quick resolutions
D) Public hearings

2 Which of the following is NOT a Correct Answer:

common type of grievance?
A) Disciplinary actions C) Employee
B) Harassment claims suggestions
C) Employee suggestions
D) Policy violations

3 What is a critical feature of a Correct Answer:

grievance procedure?
A) Complexity
B) Lack of transparency C) Clear
C) Clear communication communication
D) Delayed response
 Students have to prepare answers for the following questions at the end of the lecture

Marks CO Bloom’s
Qn
Question Knowledge
No
Level
1 Define a grievance in the workplace. 2 Marks CO3 Remembering

2 Explain the importance of a grievance procedure in an 6 Marks CO3 Understanding

organization.
3 What role does confidentiality play in handling 8 Marks CO3 Remembering
grievances?.
4. Evaluate the effectiveness of a grievance procedure in 13 Marks CO3 Understanding
promoting employee satisfaction and retention.

Lecture
Unit3 HUMAN RESOURCE MANAGEMENT
8
Topics Method of Job evaluation

Bloom’s
Learning Outcome (LO) At the end of this lecture, students will be able to
Knowledge Level
LO1 Develop the ability to apply job evaluation techniques Understanding

LO2 Analyze and differentiate between various job evaluation Analyze

methods

Job Evaluation:
An attempt to determine and compare the demands which the normal performance of
particular job makes on normal workers without taking account of the individual abilities or
performance of workers concerned. It rates the job not the rank.

Objectives:

➢ To establish correct wage correct wage differentials for all jobs with in the factory

➢ To bring new jobs into their proper relatively with jobs previously established
 ➢ To help clarify lines of authority, responsibility and promotion

➢ To accomplish the foregoing by means of the facts and principles, which can be readily
explained to and accepted by all concerned

➢ To establish a general wage level for a given factory which will have parity with those of
neighboring factories

Advantages:

➢ It is simple, inexpensive and expeditions

➢ It is easily understood and easily administered

➢ It helps setting better rates than the arbitrary rates based purely an judgment and
experience

➢ Same unions prefer it, because it leases more room for bargaining.

Disadvantages:

➢ Job may be ranked on the basis of incomplete inform action and without the benefits of
well defined standards

➢ The rank position of different jobs is likely to be influenced by the prevailing wage ranks

➢ No one committee number is likely to be familiar with all the jobs

Method of Job Evaluation:

It is broadly be classified as

➢ Qualitative Method

➢ Quantitative Method

Qualitative Method:
It can broadly be classified as ranking or classifying the job from lowest to highest.
Ranking technique: In this method, the jobs in the organization are arranged in either in the
ascending or descending order and numbered serially. The basis of such arrangement could be
the job description in terms of duties, responsibilities, qualifications needed, relative difficulty
involved in don the job, or value to the company.

Points considered:

➢ Amount of work involved

➢ Supervision needed

➢ Extent of responsibility required

➢ Difficulties involved in the work

➢ Work conditions required

Classification Method: This is also called job-grading method. Here, the number of grades and
the salary particulars for each grade are worked out first. The grades are clearly described in
terms of knowledge, skill and so on.

Major steps for job evaluation:

➢ Deciding the number of grades

➢ Writing grade descriptions

➢ Identifying/listing of the jobs to be evaluated

➢ Preparing job descriptions

Quantitative Method:
Where point values are assigned to the various demands of a job and relative value is
obtained by summing all such point values.

Factor comparison method: Every job requires certain capabilities on the part of the person
who does the job. These capabilities are considered as critical factors, which can be grouped as
follows:
➢ Mean effort Skill
➢ Physical
➢ Responsibility
➢ Working conditions
Step involved in the factor comparison method:

➢ Identify the key jobs

➢ Rank the key job, factor by factor
➢ Apportion the salary among each factor and rank the key jobs Compare factor ranking of
each job with its monetary ranking Develop a monetary comparison scale
➢ Evaluate non-key jobs based on the monetary comparison scale

Point-rating method: There are four widely accepted factors used in the point-rating method,
skill, effort, responsibility and job conditions each of these factors is divided into sub-factors

Skills
1. Education and training
2. Experience
3. Judgment and initiative

Efforts
1. Physical
2. Mental

Responsibility towards
1. Equipment or process
2. Materials or product
3. Safety of others
4. Work of others
Assessment questions to the lecture

Qn Bloom’s
Question Answer
No KnowledgeLevel

1 Which job evaluation method is Correct Answer:

particularly useful in unionized
environments?
A) To determine employee B) To establish a fair
satisfaction pay structure
B) To establish a fair pay structure
C) To assess employee performance
D) To identify training needs

2 Which job evaluation method is Correct Answer:

particularly useful in unionized
environments? C) Job Classification
A) Job Ranking Method Method
B) Point Factor Method
C) Job Classification Method
D) Market Pricing Method

3 Market Pricing as a job Correct Answer:

evaluation method relies
primarily on:
A) Internal job analysis B) External salary
B) External salary surveys surveys
C) Employee feedback
D) Historical pay scales
 Students have to prepare answers for the following questions at the end of the lecture

Marks CO Bloom’s
Qn
Question Knowledge
No
Level
1 Name two common methods of job evaluation. 2 Marks CO3 Remembering

2 Explain the Point Factor Method of job evaluation. 6 Marks CO3 Understanding
3 Discuss the advantages and disadvantages of the Job 8 Marks CO3 Remembering
Classification Method.
4. Evaluate the effectiveness of different job evaluation 13 Marks CO3 Understanding
methods in various organizational contexts.

Lecture
Unit3 HUMAN RESOURCE MANAGEMENT
9
Topics Performance Management System

Bloom’s
Learning Outcome (LO) At the end of this lecture, students will be able to
Knowledge Level
LO1 Understanding Key Components Understanding

LO2 Application of PMS in Organizations Apply

Merit Rating: Merit rating is the process of evaluating the relative merit of the person on a
given job. It is an essential task of the personnel manager to distinguish the meritorious
employees from the other. The data collected from this task is used for strategic decisions such
as releasing an increment in pay, promotion, transfer, and transfer on promotion to a critical
assignment or even discharge.

Objectives of Merit Rating:

➢ To determine salary increments

➢ To decide who has to be transferred, promoted, or demoted

➢ To discover the workers needs for retaining and advanced training

 ➢ To unfold the exceptional skills among the employees based on their innate potentials

➢ To guide and monitor the performance of those who are lagging behind.

Method of Merit Rating:

Ranking method: In this method, all the staff of a particular cadre or a department are arranged
either in the ascending or the descending order in order of merit or value to the firm. Though this
is a simple method, it cannot be followed where the employees in the department are many in
number.

Paired comparison method: Here, every employee is compared with all others in a particular
cadre in the department. By comparing each pair of employees, the rater can decide which of the
employees is more valuable to the organization.

Rating scale: Here, the factors dealing with the quantity and quality of work are listed and rated.
A numeric value may be assigned to each factor and the factors could be weighed in the order of
their relative importance. All the variables are measured against a three or five point scale.

Forced distribution method: Here, employees are given a set of alternatives and they have to
choose one, which reflects their understanding of the true nature of the job. Their thinking is
conditioned by the given set of answers.

Narrative or essay method: Here, the candidate is required to narrate in an essay format his/her
strengths, weaknesses, and potential to perform. Here, the candidate is not restricted by any
given set of alternatives. The candidate is free to decide what to furnish or what not to furnish.

Management by objectives (MPO): The short-term objectives standards. This method

considers the actual performance as the basis mutually agreed upon by the management and the
employees are used as performance for evaluation. It is a systematic method of goal setting. In
addition, it provides for reviewing performance based on results rather than personality traits or
characteristics. However, this is not practical at all levels and for all kinds of work in the
organizations.

Capability Maturity Model levels

Capability Maturity Model is a bench-mark for measuring the maturity of an organization‘s
software process. It is a methodology used to develop and refine an organization‘s software
development process. CMM can be used to assess an organization against a scale of five process
maturity levels based on certain Key Process Areas (KPA). It describes the maturity of the
company based upon the project the company is dealing with and the clients. Each level ranks
the organization according to its standardization of processes in the subject area being assessed.

A maturity model provides:

➢ A place to start

➢ The benefit of a community‘s prior experiences

➢ A common language and a shared vision

➢ A framework for prioritizing actions

➢ A way to define what improvement means for your organization

In CMMI models with a staged representation, there are five maturity levels designated by the
numbers 1 through 5 as shown below:
1. Initial

2. Managed

3. Defined

4. Quantitatively Managed

5. Optimizing
Maturity levels consist of a predefined set of process areas. The maturity levels are measured by
the achievement of the specific and generic goals that apply to each predefined set of process
areas. The following sections describe the characteristics of each maturity level in detail

Assessment questions to the lecture

Qn Bloom’s
Question Answer
No KnowledgeLevel

1 What is the primary purpose of a Correct Answer:

performance management
system?
A) To discipline employees B) To enhance
B)To enhance employee employee performance
and development
performance and development
C)To increase organizational
bureaucracy
D) To conduct annual appraisals
only

2 What is the purpose of 360- Correct Answer:

Degree Feedback in performance
management? B) To obtain a
A) To gather feedback from a single comprehensive view
supervisor only of employee
B) To obtain a comprehensive view performance from
of employee performance from multiple sources
multiple sources
C) To assess team performance only
D) To focus solely on quantitative
metrics

3 What is an essential feature of Correct Answer:

continuous performance
management?
A) Annual reviews only B) Regular check-ins
B) Regular check-ins and feedback and feedback
C) Static goal setting
D) Isolated assessments
Students have to prepare answers for the following questions at the end of the lecture

Marks CO Bloom’s
Qn
Question Knowledge
No
Level
1 What is the primary purpose of the CMMI model? 2 Marks CO3 Remembering

2 Explain two advantages of implementing a merit rating 6 Marks CO3 Understanding

system in organizations.
3 Discuss the criteria typically used in merit rating 8 Marks CO3 Remembering
systems.
4. Evaluate the effectiveness of the CMMI model in 13 Marks CO3 Understanding
improving organizational processes.