MODULE -1

• Introduction:
• Introduction to HRM,
• PM v/s HRM, Nature,
• Scope and Importance of Human Capital in an organization.
• History of HRM and HR movement Functions
• Functions and Objectives of HRM
• Human Resource Planning:
• Definition and objectives of Human Resource planning.
• Process & Methods of Human Resource planning.
• Factors influencing estimation of Human Resources
INTRODUTION TO HUMAN RESOURCE
MANAGEMENT
• 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.
INTRODUTION TO HUMAN RESOURCE
MANAGEMENT
• 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.
• Any Organization has three basic components, People, Purpose, and
Structure.
INTRODUTION TO HUMAN RESOURCE
MANAGEMENT
• 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 caliber of people in the organization.
• That predicted future is today’s reality.
INTRODUTION TO HUMAN RESOURCE
MANAGEMENT
• 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.
INTRODUTION TO HUMAN RESOURCE
MANAGEMENT
• 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).
DEFINTION OF HUMAN RESOURCE
MANAGEMENT
• Human Resource Management (HRM) is the strategic approach to
managing an organization’s most valuable asset—its people. It
involves the planning, organizing, directing, and controlling of human
resources to achieve organizational goals efficiently and effectively.
HRM focuses on maximizing employee performance, fostering a
positive work environment, and aligning individual goals with
organizational objectives.
EXPLAIN SCOPE OF HUMAN RESOURCE
MANAGEMENT ? ( GTU - 2/12/19, 22/6/22, 8/1/24)
• 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
view 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.
EXPLAIN SCOPE OF HUMAN RESOURCE
MANAGEMENT
• 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
EXPLAIN SCOPE OF HUMAN RESOURCE
MANAGEMENT
• Training and Development
• Organizational Development
• Compensation and Benefits
• Employee Assistance
• Union/Labour Relations
• Personnel Research and Information System
EXPLAIN SCOPE OF HUMAN RESOURCE
MANAGEMENT
• 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.
EXPLAIN SCOPE OF HUMAN RESOURCE
MANAGEMENT
• 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.
EXPLAIN SCOPE OF HUMAN RESOURCE
MANAGEMENT
• 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.
EXPLAIN SCOPE OF HUMAN RESOURCE
MANAGEMENT
• 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.
EXPLAIN SCOPE OF HUMAN RESOURCE
MANAGEMENT
• g) Employee Assistance: Each employee is unique in character,
personality, expectation and temperament.
• By and large each one of them faces problems everyday. 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.
EXPLAIN SCOPE OF HUMAN RESOURCE
MANAGEMENT
• 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.
EXPLAIN NATURE OF HUMAN RESOURCE
MANAGEMENT
• 1. HRM is based on certain principles ( goal oriented approach,
people oriented approach, ethical approach) and policies (
compensation, training and development) which helps the
organization to achieve its objectives.

• 2. HRM is a pervasive/universal function – It suggest that HRM is not

associated to a single department, instead it is a broader function
and is spread throughout the organisation, which manages all type of
employees/people from lower level to top level departments of the
organisation.
EXPLAIN NATURE OF HUMAN RESOURCE
MANAGEMENT
• 3. HRM is people oriented – The main core or concern for HRM is the
People or human resource. Human resource management works
with and for people.
• It acts as a bridge which brings people and organisation together to
achieve individual and organisational goals.
• 4. HRM is continuous activity – As HRM needs to continuously train,
develop, or replace to meet the growing level of competition and
changes in the market. Hence, it is a continuous activity.
EXPLAIN NATURE OF HUMAN RESOURCE
MANAGEMENT
• 5. The HRM is a part of management function. Issues like hiring,
training, development, compensation; motivation, communication,
and administration etc of employees are taken care by Human
resource management.
• 6. The main aim of HRM is optimum utilization of employees.
EXPLAIN OBJECTIVES OF HUMAN RESOURCE
MANAGEMENT ( 22/6/2022 – GTU )
• 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 fulfill 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
EXPLAIN OBJECTIVES OF HUMAN RESOURCE
MANAGEMENT ( 22/6/2022 – GTU )
• 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 and
employee relationship
• 5) Helping to create and maintain a safe and healthy work
environment.
EXPLAIN OBJECTIVES OF HUMAN RESOURCE
MANAGEMENT ( 22/6/2022 – GTU )
• 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.
EXPLAIN OBJECTIVES OF HUMAN RESOURCE
MANAGEMENT ( 22/6/2022 – GTU )
• 8) To provide organization with well-trained and well-motivated
employees.
• 9) To increase the employees satisfaction.
• 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 behavior.
EXPLAIN OBJECTIVES OF HUMAN RESOURCE
MANAGEMENT ( 22/6/2022 – GTU )
EXPLAIN OBJECTIVES OF HUMAN RESOURCE
MANAGEMENT ( 22/6/2022 – GTU )
• 1) 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.
• 2)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.
EXPLAIN OBJECTIVES OF HUMAN RESOURCE
MANAGEMENT ( 22/6/2022 – GTU )
• 3)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.
• 4) 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.
EXPLAIN FUNCTION OF HUMAN RESOURCE
MANAGEMENT ( GTU – 02/12/19,
01/6/24,22/6/22, 8/1/24)
• The function performed by the resource management can broadly be
classified into two categories, i.e. Managerial functions and
Operative functions.
• 1. Managerial Functions: It includes Planning, Organising, Staffing,
Directing and controlling (POSDC)
• a. Planning: Planning is to plan for future or predetermine the course
of actions to be taken in future. It is a process of identifying the
organisational goals and formulation of policies and programmes for
achieving those goals.
EXPLAIN FUNCTION OF HUMAN RESOURCE
MANAGEMENT ( GTU – 02/12/19,
01/6/24,22/6/22, 8/1/24)
• b. Organising: Organising is a process by which the structure and
allocation of jobs are determined. Thus organising involves giving
each employee a specific task establishing departments, delegating
authority to subordinates, establishing channels of authority and
communication, coordinating the work of subordinates, and so on.
• c.Staffing: This is a process by which managers select, train, promote
and remove their employees This involves deciding what type of
people should be hired, recruiting, selecting employees, setting the
performance standard, compensation of employees, evaluation of
performance of employees, counseling employees, training and
developing employees.
EXPLAIN FUNCTION OF HUMAN RESOURCE
MANAGEMENT ( GTU – 02/12/19,
01/6/24,22/6/22, 8/1/24)
• d. Directing/Leading: Directing is the process of initiating or
activating group efforts to achieve the desired organizational goals,
which includes activities like getting subordinates to get the job
done, maintaining their morale, motivating subordinates etc, for
achieving the organizational goals.
• e. Controlling: It is the process of setting the standards for
performance, measuring the actual performance of the employees
and then comparing the actual performance with the standards and
there by taking corrective actions as needed.
EXPLAIN FUNCTION OF HUMAN RESOURCE
MANAGEMENT ( GTU – 02/12/19,
01/6/24,22/6/22, 8/1/24)
• 2.Operative Functions: The Management functions as suggested
were common to all the mangers where as the Operative, also called
as service functions are relevant to specific department only. These
functions differ from department to department depending upon the
nature of the department.
• Viewed from this standpoint, the operative functions of HRM relate
to ensuring right people for right jobs at right times.
• These functions include procurement, development, compensation,
and maintenance functions of HRM. A brief description of these
follows:
EXPLAIN FUNCTION OF HUMAN RESOURCE
MANAGEMENT ( GTU – 02/12/19,
01/6/24,22/6/22, 8/1/24)
• a. Procurement: It involves procuring the right kind of people in the
right or rather appropriate number to be placed in the organisation.
It consists of activities such as manpower planning, recruitment,
selection placement and induction or orientation of new
employees.
• b. Development: It includes activities meant to improve the
knowledge, skills aptitudes and values of employees so as to enable
them to perform their jobs in a better manner in future. It
comprises of training to employees, executive training to develop
managers, organisation development to strike a better fit between
organisational climate/culture and employees.
EXPLAIN FUNCTION OF HUMAN RESOURCE
MANAGEMENT ( GTU – 02/12/19,
01/6/24,22/6/22, 8/1/24)
• c. Compensation: Compensation function involves determination of
wages and salaries which should match with the contribution made
by employees towards achieving organisational goals. In other words,
this function ensures equitable and fair remuneration for
employees in the organisation. It consists of activities such as job
evaluation, wage and salary administration, bonus, incentives, etc.
• d. Maintenance: It is concerned with retaining or protecting and
promoting employees while at work. For this purpose several
benefits such as housing, medical, educational, transport facilities,
etc. are provided to the employees. Several other social security
measures such as provident fund, pension, gratuity, group insurance,
etc. are also being given to the employees.
EXPLAIN FUNCTION OF HUMAN RESOURCE
MANAGEMENT ( GTU – 02/12/19,
01/6/24,22/6/22, 8/1/24)
• e) Motivation: Employees work in the organisation for the satisfaction of
their needs. In many of the cases, it is found that they do not contribute
towards the organisational goals as much as they can.
• This happens because employees are not adequately motivated. The
human resource manager helps the various departmental managers to
design a system of financial and non-financial rewards to motivate the
employees.
• f) Personnel Records: The human resource or personnel department
maintains the records of the employees working in the enterprise. It keeps
full records of their training, achievements, transfer, promotion, etc. It also
preserves many other records relating to the behaviour of personnel like
absenteeism and labour turnover and the personnel programs and policies
of the organisation.
EXPLAIN FUNCTION OF HUMAN RESOURCE
MANAGEMENT ( GTU – 02/12/19,
01/6/24,22/6/22, 8/1/24)
EXPLAIN IMPORTANCE OF HUMAN RESOURCE
MANAGEMENT ( GTU – 22/6/2022)
• To maintain quality of work life
• Quality of work life is the perception of employees regarding the
relationship between working condition with management. Simply, it
is the relationship between employees and total work environment.
• Quality of work life is concerned with the employee’s perception of
physical as well as psychological wellbeing at workplace and it can be
obtained by maintaining work autonomy, work freedom, job
recognition, belongingness, rewards, etc.
EXPLAIN IMPORTANCE OF HUMAN RESOURCE
MANAGEMENT ( GTU – 22/6/2022)
• To increase productivity and profit
• Human resource management ensures right quality and quantity of
personnel in workplace, apart from which, it creates opportunities to
facilitate and motivate individual and group of employees to grow and
advance their career.
• Motivated employees work hard to meet their personal career goal
which directly influences productivity of organisation. Minimising cost
and maximising profit is the essence of productivity.
EXPLAIN IMPORTANCE OF HUMAN RESOURCE
MANAGEMENT ( GTU – 22/6/2022)
• To produce employees who are easily adaptable to change
• Human resource management performs various functions, among
which training and development of employees is one of the vital
ones.
• Training and development programs keep employees updated with
skills necessary to adjust with alteration of organisation’s
environment, structure and technology.
EXPLAIN IMPORTANCE OF HUMAN RESOURCE
MANAGEMENT ( GTU – 22/6/2022)
• To match demand and supply of human resource
• Human resource management probes existing human resource in
certain interval of time to identify if the company has adequate
number of workers or not.
• In case when company has inadequate human resource, human
resource management performs activities like recruitment and
selection to balance the need. In the same way, it lay-off inefficient
employee in case when the company has excessive employees
EXPLAIN IMPORTANCE OF HUMAN RESOURCE
MANAGEMENT ( GTU – 22/6/2022)
• To retain employees and motivate them to accomplish company’s
goal
• Utilising human resource to their fullest and maintaining them in the
company for a long term is a major function of human resource
management. Under this function, HRM performs tasks like providing
fringe benefits, compensation and rewards to the deserving
employees. These activities do not only help in retaining employees in
the company but also in achieving organisation’s goal effectively.
EXPLAIN IMPORTANCE OF HUMAN RESOURCE
MANAGEMENT ( GTU – 22/6/2022)
• To recognise merit and contribution of employee
• Human resource management performs timely appraisal of
employee’s performance in order to recognise excellent and poor
workers. The excellent workers are then rewarded as a return for their
contribution.
EXPLAIN IMPORTANCE OF HUMAN RESOURCE
MANAGEMENT ( GTU – 22/6/2022)
• To create a feeling of belongingness and team spirit in the employee
• Human resource management designs job on the basis of teamwork.
As teamwork demands contribution from every team member, HRM
focuses on making each and every employee feel valued so that
employee contributes best from their side.
EXPLAIN IMPORTANCE OF HUMAN RESOURCE
MANAGEMENT ( GTU – 22/6/2022)
• To sustain business in the market
• Human resource management makes sure that the company has the
best employee because promising employees are capable of taking
their company ahead in the race by delivering excellent results. This
guarantees organisation’s success and stability in future.
DEFINITION OF HUMAN RESOURCE PLANNING
• Human Resource Planning suggest of putting right number of people,
right kind of people at the right place, at right time, and doing the
right things for which they are selected and suited for the
achievement of goals of the organization.
• Human Resource Planning has got an important place in the arena of
industrialization.
DEFINITION OF HUMAN RESOURCE PLANNING
• Different definition given by different person. ( note : you need to
learn only one definition from exam point of view)
• According to Vetter, “HRP is the process by which management
determines how the organization should move from its current man
power position to desired manpower position.
• Through planning, management strives to have the right time, doing
things which result in both the organization and individual receiving
maximum long run benefits”.
DEFINITION OF HUMAN RESOURCE PLANNING
• As according to Geisler, ―Manpower planning or HR Planning is the
process which includes forecasting, developing and controlling by
which a organization ensures that it has-
• ∙ The right number of people,
• ∙ The right kind of people,
• ∙ At the right places,
• ∙ At the right time, doing work for which they are economically most
useful.
DEFINITION OF HUMAN RESOURCE PLANNING
• According to Gordon Mc Beath, “HRP is concerned with two things:
Planning of manpower requirements and Planning of Manpower
supplies”.
Objectives of Human Resource Planning
1. To ensure optimum utilization/ use of human resources currently
available in the organization.
2. To assess or forecast the future skill requirement of the organization
3. To provide control measures to ensure that necessary resources are
available as and when required.
4. To determine present requirement level of human resource so as to
ensure smooth functioning of the organization.
5. To analyze and calculate future skills requirement.
6. To meet company goals the organization HR planning is essential.
Objectives of Human Resource Planning
• 6. To provide control measures so as to ensure that necessary resources
are available as and when required.
• 7. To anticipate terminations and avoid unnecessary dismissals and assess
training and development needs.
• 8. It is also needed for identifying surplus or shortage manpower areas and
there by balancing manpower.
• Thus, in short human resource planning provides right size and structure of
human resources which provides the basic infrastructure for smooth
functioning of an organisation.
• It minimizes the cost of employment and nullifies the effects of disruptions
in developing and utilizing the human resources.
PROCESS OF HUMAN RESOURCE PLANNING
• Environmental Scanning:
• It refers to the systematic monitoring of the external forces influencing the
organization.
• The following forces are essential for HRP.
• ∙ Economic factors, including general and regional conditions.
• ∙ Technological changes
• ∙ Demographic changes including age, composition and literacy,
• ∙ Political and legislative issues, including laws and administrative rulings
• ∙ Social concerns, including child care, educational facilities and priorities.
• By scanning the environment for changes that will affect an organization,
managers can anticipate their impact and make adjustments early.
• Organizational Objectives and Policies: HR plan is usually derived
from the organizational objectives.
• Specific requirements in terms of number and characteristics of
employees should be derived from organizational objectives
• Once the organizational objectives are specified, communicated and
understood by all concerned, the HR department must specify its
objective with regard to HR utilization in the organization.
• HR Demand Forecast:
• Demand forecasting is the process of estimating the future quantity
and quality of people required to meet the future needs of the
organization.
• Annual budget and long-term corporate plan when translated into
activity form the basis for HR forecast.
• For eg: in the case of a manufacturing company, the sales budget will
form the basis for production plan giving the number and type of
products to be produced in each period.
• This will form the basis upon which the organization will decide the
number of hours to be worked by each skilled category of workers.
• Once the number hours required is available organization can
determine the quality and quantity of personnel required for the task.
• Demand forecasting is influenced by both internal factors and
external factors:
• external factors include competition, economic climate, laws and
regulatory bodies, changes in technology and social factors
• whereas internal factors are budget constraints, production level, new
products and services, organizational structure and employee
separations.
• Demand forecasting is essential because it helps the organization to
• 1. Quantify the jobs, necessary for producing a given number of goods,
• 2. To determine the nature of staff mix required in the future.
• 3. To assess appropriate levels in different parts of organization so as to
avoid unnecessary costs to the organization.
• 4. To prevent shortages of personnel where and when, they are needed by
the organization.
• 5. To monitor compliances with legal requirements with regard to
reservation of jobs.
• HR Supply Forecast:
• Supply forecast determines whether the HR department will be able
to procure the required number of workers.
• Supply forecast measures the number of people likely to be available
from within and outside an organization, after making allowance for
absenteeism, internal movements and promotions, wastage and
changes in hours, and other conditions of work.
• Supply forecast is required because it is needed as it
• 1. Helps to quantify the number of people and positions expected to
be available in future to help the organization realize its plans and
meet its objectives
• 2. Helps to clarify the staff mixes that will arise in future
• 3. It assesses existing staffing in different parts of the organization.
• 4. It will enable the organization to prevent shortage of people where
and when they are most needed.
• 5. It also helps to monitor future compliance with legal requirements
of job reservations.
• HR Programming:
• Once an organization’s personnel demand and supply are forecasted
the demand and supply need to be balanced in order that the
vacancies can be filled by the right employees at the right time.
• HR Plan Implementation:
• HR implementation requires converting an HR plan into action. A
series of action are initiated as a part of HR plan implementation.
Programmes such as recruitment, selection and placement, training
and development, retraining and redeployment, retention plan,
succession plan etc when clubbed together form the implementation
part of the HR plan.
• Control and Evaluation:
• Control and evaluation represent the final phase of the HRP process.
All HR plan include budgets, targets and standards.
• The achievement of the organization will be evaluated and monitored
against the plan.
• During this final phase organization will be evaluating on the number
of people employed against the established (both those who are in
the post and those who are in pipe line) and on the number recruited
against the recruitment targets.
• Evaluation is also done with respect to employment cost against the
budget and wastage accrued so that corrective action can be taken
in future.
DIFFERENCE BETWEEN PERSONNEL MANAGEMENT
AND HUMAN RESOURCE MANAGEMENT ( 10/7/23,
22/6/22, 8/1/24, 3/1/22 – GTU EXAM)
• 1. Focus
• PM: Focuses on managing employees' basic needs, like hiring, paying
salaries, and ensuring workplace rules are followed.
• HRM: Focuses on employees as valuable assets and helps them grow
by improving their skills, motivation, and satisfaction.
• 2. Approach
• PM: Follows a traditional approach, focusing on administrative tasks
and employee welfare.
• HRM: Takes a modern approach, focusing on aligning employee goals
with the company’s goals to boost performance.
DIFFERENCE BETWEEN PERSONNEL MANAGEMENT
AND HUMAN RESOURCE MANAGEMENT ( 10/7/23,
22/6/22, 8/1/24, 3/1/22 – GTU EXAM)
• 3. Relationship with Employees
• PM: Treats employees more like workers with a fixed role to perform.
• HRM: Sees employees as partners, encouraging innovation and
involvement in decision-making.
• 4. Strategies
• PM: Short-term focus (e.g., filling job vacancies, resolving immediate
issues).
• HRM: Long-term focus (e.g., developing employee potential and
planning future needs)
DIFFERENCE BETWEEN PERSONNEL MANAGEMENT
AND HUMAN RESOURCE MANAGEMENT ( 10/7/23,
22/6/22, 8/1/24, 3/1/22 – GTU EXAM)
• 5. Tools and Techniques
• PM: Uses simple tools like job descriptions, pay scales, and
attendance tracking.
• HRM: Uses advanced tools like performance appraisals, training
programs, and career development plans.
• 6. Nature of Job
• PM: Mainly deals with routine and operational tasks like payroll
processing, employee grievances, and compliance with labor laws.
• HRM: Involves strategic activities like workforce planning, talent
management, and fostering innovation in the workplace.
DIFFERENCE BETWEEN PERSONNEL MANAGEMENT
AND HUMAN RESOURCE MANAGEMENT ( 10/7/23,
22/6/22, 8/1/24, 3/1/22 – GTU EXAM)
• 7. Level of Involvement
• PM: Operates as a separate function with limited involvement in the
organization's strategic decisions.
• HRM: Is deeply integrated into the organization’s strategy, ensuring
that human resources contribute to achieving long-term goals.
• 8. Employee Motivation
• PM: Relies on external rewards like salaries, bonuses, and job security
to motivate employees.
• HRM: Focuses on intrinsic motivation by offering opportunities for
growth, learning, recognition, and personal development.
DIFFERENCE BETWEEN PERSONNEL MANAGEMENT
AND HUMAN RESOURCE MANAGEMENT ( 10/7/23,
22/6/22, 8/1/24, 3/1/22 – GTU EXAM)
• 9. Communication Style
• PM: Follows a top-down communication approach, where
instructions flow from management to employees.
• HRM: Encourages two-way communication, promoting feedback,
collaboration, and employee participation in decisions.
• 10. Conflict Resolution
• PM: Uses rules, policies, and disciplinary measures to handle
conflicts.
• HRM: Focuses on addressing the root causes of conflicts and
resolving them through negotiation and employee engagement.
DIFFERENCE BETWEEN PERSONNEL MANAGEMENT
AND HUMAN RESOURCE MANAGEMENT ( 10/7/23,
22/6/22, 8/1/24, 3/1/22 – GTU EXAM)
• 11. Training and Development
• PM: Provides limited, need-based training to improve job-specific
skills.
• HRM: Continuously invests in training programs, leadership
development, and upskilling to prepare employees for future roles.
• 12. Flexibility
• PM: Is rigid in policies and procedures, leaving little room for
customization.
• HRM: Adopts flexible approaches tailored to individual employees
and changing business needs.
DIFFERENCE BETWEEN PERSONNEL MANAGEMENT
AND HUMAN RESOURCE MANAGEMENT ( 10/7/23,
22/6/22, 8/1/24, 3/1/22 – GTU EXAM)
• 13. Cost vs. Investment
• PM: Views employee-related expenses as a cost to the company.
• HRM: Views employees as investments that can bring returns through
increased productivity and innovation.
METHODS OF HUMAN RESOURCE PLANNING
• HR DEMAND FORECASTING METHODS:
• Demand forecasting in HR planning is about predicting how many
employees a company will need in the future and the skills they
should have. Here are some easy-to-understand methods:
• 1. Trend Analysis
• What it is: Looks at past data to predict future staffing needs.
• How it works:
• Study past hiring records over several years.
• Identify patterns or trends (e.g., if the company hired more staff when sales
increased).
• Use this trend to predict future needs.
• Example: If a company has been hiring 5 new employees every year
for the past 3 years, they might plan to hire 5 more next year.
• Best for: Companies with stable and predictable growth patterns.
• 2. Workload Analysis
• What it is: Predicts staff needs based on the expected amount of
work.
• How it works:
• Estimate the workload (e.g., production units, service hours).
• Calculate how many employees are needed to handle that workload.
• Example: A factory produces 100 units with 5 workers. If production
is expected to increase to 200 units, they’ll need 10 workers.
• Best for: Work environments with measurable tasks like
manufacturing or customer service.
• 3. Ratio Analysis
• What it is: Uses a ratio between a business metric and staffing
needs.
• How it works:
• Find a relationship between staff numbers and a business factor (like sales or
customers).
• Use this ratio to calculate future staff needs.
• Example: If a call center has 10 agents for every 1,000 calls, and call
volume is expected to rise to 2,000 calls, they’ll need 20 agents.
• Best for: Businesses with consistent ratios, like retail or call center
• 4. Expert Judgment
• What it is: Relies on experienced managers or HR professionals to
make predictions.
• How it works:
• Managers use their experience and knowledge to estimate future staff needs.
• These predictions may consider market trends, upcoming projects, or
industry insights.
• Example: A project manager knows that a new software development
project will require 3 additional developers.
• Best for: Small or new companies without much historical data.
• 5. Delphi Technique
• What it is: A structured way of gathering opinions from multiple
experts to forecast demand.
• How it works:
• Experts answer questions anonymously about future staffing needs.
• Their answers are collected, summarized, and shared with the group for
feedback.
• This process is repeated until a final solution is reached.
• Example: HR experts are asked how many employees will be needed
for a new branch. Their answers are refined over several rounds.
• Best for: Situations with uncertain or complex requirements.
• 6. Mathematical Models
• What it is: Uses formulas and computer models to predict staff needs
based on business data.
• How it works:
• Input data like sales, production rates, or economic conditions into a model.
• The model calculates how many employees will be needed.
• Example: A company uses software to analyze its sales growth and
predicts hiring 15 new employees next year.
• Best for: Large companies with access to detailed data and advanced
technology.
• 7. Scenario Analysis
• What it is: Plans for multiple possible future situations to determine
staffing needs.
• How it works:
• Create different scenarios (e.g., high sales, low sales, or no change).
• Estimate the number of employees needed in each case.
• Example: If sales double, the company might hire 30 people; if sales
stay the same, they’ll hire 10.
• Best for: Industries prone to uncertainty or rapid change
• 8. Regression Analysis
• What it is: A statistical method to find relationships between factors
(like sales growth) and staff needs.
• How it works:
• Analyze past data to see how changes in one factor (like sales) impacted
staffing.
• Use this relationship to predict future needs.
• Example: If a 10% increase in sales required 5 new employees in the
past, the company might predict the same for the future.
• Best for: Companies with reliable historical data.
• These methods help organizations prepare for future staffing needs
based on their goals, work requirements, and external factors.
Choosing the right method depends on the business type, data
availability, and market conditions.
• HR SUPPLY FORECASTING :
• Supply forecasting in HR is about estimating how many employees are
available, both inside and outside the organization, to meet future
needs. Here’s a detailed explanation of the methods in simple
language:
• 1. Internal Supply Analysis
• What it is: Looks at the employees the company already has.
• How it works:
• Review current staff numbers, their skills, experience, and roles.
• Identify employees eligible for promotions, transfers, or retaining.
• Example: If a company has 10 senior developers and 5 are ready for
leadership roles, they can plan to fill management positions internally.
• Best for: Companies with a strong focus on employee development
and promotion.
• 2. External Supply Analysis
• What it is: Examines the availability of workers in the job market.
• How it works:
• Study labor market trends, including unemployment rates, skill availability,
and competition.
• Consider geographic factors, like whether workers in the area have the
required skills.
• Example: A company expanding into a new city might analyze how
many local workers are available for their industry.
• Best for: Organizations hiring for new roles or expanding into new
locations.
• 3. Workforce Flow Analysis
• What it is: Tracks how employees move within and out of the company.
• How it works:
• Analyze data on hiring, promotions, resignations, retirements, and terminations.
• Predict future availability based on patterns (e.g., retirement of senior employees).
• Example: If 5 employees retire each year and 2 are promoted annually, the
company can forecast how many new hires will be needed.
• Best for: Companies with consistent employee turnover patterns.
• 4. Replacement Charts
• What it is: Visual tools to identify potential replacements for key
positions.
• How it works:
• List critical roles and the employees currently in those positions.
• Identify employees who can step into these roles if needed.
• Example: A replacement chart might show that a senior manager is
nearing retirement and highlight two mid-level managers ready to
take over.
• Best for: Succession planning in leadership or critical roles.
• 5. Succession Planning
• What it is: Focuses on preparing employees to fill key roles in the
future.
• How it works:
• Identify employees with potential for leadership or specialized roles.
• Provide training and development to prepare them for future positions.
• Example: A company might identify a promising junior manager and
provide mentorship and training to prepare them for a senior role.
• Best for: Long-term planning for leadership or highly skilled positions
• 6. Skill Inventory
• What it is: A detailed database of employee skills and qualifications.
• How it works:
• Record information about each employee's skills, education, certifications,
and experience.
• Use this database to match employees with future job requirements.
• Example: When planning a new project, HR can check the inventory
to find employees with the required skills instead of hiring externally.
• Best for: Organizations with diverse skill requirements.
• 7. Labor Market Surveys
• What it is: Gathers data about the external labor market.
• How it works:
• Conduct surveys to understand trends like salary expectations, available
skills, and job market conditions.
• Use this information to plan recruitment strategies.
• Example: If a survey shows a shortage of software developers, a
company might start training programs to fill the gap internally.
• Best for: Industries with dynamic job markets.
• 8. Attrition Analysis
• What it is: Predicts how many employees will leave the company.
• How it works:
• Study past attrition rates (resignations, retirements, etc.).
• Identify reasons for attrition (e.g., job dissatisfaction, retirement age).
• Example: If a company loses 5% of its workforce annually, they can
plan to recruit that percentage to maintain staff levels.
• Best for: Managing workforce stability in high-turnover industries.
• 9. Markov Analysis
• What it is: A statistical method to predict employee movement within
the company.
• How it works:
• Analyze historical data on promotions, transfers, and exits.
• Use probabilities to predict how employees will move in the future.
• Example: If data shows that 30% of entry-level employees are
promoted within 2 years, the company can plan future staffing based
on this trend.
• Best for: Large organizations with significant internal mobility.
FACTORS INFLUENCING ESTIMATION OF
HUMAN RESOURCES
• The estimation of human resource needs is a complex process
influenced by a variety of factors. These factors can be broadly
categorized into internal and external factors.
FACTORS INFLUENCING ESTIMATION OF
HUMAN RESOURCES
• Internal Factors:
• Organizational Strategy: The overall goals, objectives, and
strategic plans of the organization play a crucial role in
determining the required human resources. For example, a
company planning to expand its operations will require more
employees than a company that is maintaining its current level
of operations.
• Organizational Structure: The structure of the organization,
including the number of departments, reporting relationships,
and span of control, affects the number and types of employees
needed.
FACTORS INFLUENCING ESTIMATION OF
HUMAN RESOURCES
• Technology: The level of technology adoption within the
organization can impact the required human resources. For
example, the introduction of automation or artificial intelligence
may reduce the need for certain types of employees while
creating a demand for new skills.

• Financial Resources: The financial resources available to the

organization will limit the number of employees that can be
hired and the compensation that can be offered.
FACTORS INFLUENCING ESTIMATION OF
HUMAN RESOURCES
• Human Resource Policies: The organization's policies on
hiring, training, promotion, and compensation will influence the
availability and quality of human resources.
• Work Environment :
• A pleasant work environment is another factor for HR managers to
consider. Employees want to be part of a team that’s committed to a
common goal and where they enjoy the respect of co-workers and
management. If an employee isn’t happy, they may leave to work
elsewhere.
FACTORS INFLUENCING ESTIMATION OF
HUMAN RESOURCES
• External Factors:
• Economic Conditions: The overall economic climate, including
factors such as interest rates, inflation, and unemployment
rates, can affect the availability and cost of human resources.

• Labor Market Conditions: The supply and demand of labor in

the relevant industry or region will impact the availability and
cost of qualified employees.
FACTORS INFLUENCING ESTIMATION OF
HUMAN RESOURCES
• Technological Advancements: Technological advancements
can create new job opportunities while making others obsolete,
thus impacting the demand for specific skills and knowledge.
• Government Regulations: Government regulations related to
employment, such as minimum wage laws and workplace
safety standards, can affect the cost and availability of human
resources.
FACTORS INFLUENCING ESTIMATION OF
HUMAN RESOURCES
• Social and Cultural Factors: Social and cultural factors, such
as demographics, lifestyle changes, and societal values, can
influence the preferences and expectations of employees.

• By carefully considering these factors, organizations can

develop accurate estimates of their human resource needs and
make informed decisions about their workforce planning.
History of Human Resource Management (HRM)
and the HR Movement
• Human Resource Management (HRM) has evolved over time,
influenced by industrial, social, and economic changes. It started with
basic labor management and has now become a strategic function in
organizations. Let’s explore its history step by step.
1. Early Industrial Period (Pre-Industrial Revolution)
• Before industries, people worked in small groups or family businesses
(agriculture, craftsmanship, and trade).
• There were no formal HR policies—workers were hired based on
relationships, skills, or necessity.
• No structured wages, working hours, or employee rights.
2. Industrial Revolution (1760–1850)
• Factories and large-scale industries began, leading to mass
employment.
• Workers faced long hours, low wages, and poor working conditions.
• Due to these issues, trade unions were formed to demand better
rights.
• The need for managing employees systematically led to the
emergence of Personnel Management (early HRM).
3. Emergence of Personnel Management (1900s–1930s)
• Businesses started hiring personnel officers to handle employee
wages, welfare, and hiring.
• Governments began introducing labor laws to protect workers
(minimum wages, safety laws, etc.).
• HR at this stage was focused on record-keeping, payroll, and
compliance rather than employee growth.
4. Human Relations Movement (1930s–1950s)
• The famous Hawthorne Studies by Elton Mayo showed that
employee performance improved when they felt valued.
• This led to a shift from strict control to motivating employees for
better productivity.
• Employee welfare, training, and motivation became important.
5. Evolution of Modern HRM (1960s–1980s)
• HR started focusing on employee satisfaction, leadership, and
performance management.
• The Civil Rights Movement and Equal Employment Laws promoted
fair hiring practices.
• HR departments expanded to include training, performance
appraisals, and conflict resolution.
6. Strategic HRM and Technology (1990s–Present)
• HRM became a strategic function—helping businesses achieve goals
by managing people effectively.
• Technology and automation changed how HR operates (online
recruitment, HR software, data analytics).
• Workplace diversity, employee well-being, and work-life balance
became major focus areas.
7. Future of HRM (Present and Beyond)
• Artificial Intelligence (AI) and automation are changing recruitment
and employee management.
• Remote work and flexible jobs are reshaping HR strategies.
• Employee well-being, mental health support, and continuous
learning will be key in the future of HRM.
• HRM has grown from basic employee management to a strategic
business function. It now plays a crucial role in creating a positive
work culture, improving productivity, and ensuring employee well-
being.