Prestige Institute Of Management

Gwalior

BBA (IV) Sem

Subject : Human Resource
Management

By: Asst. Prof. ISHA GOLEY

 Concept of Human Resource
Management
Human Resource Management (HRM) is a process of
bringing people and organization together so that both can
achieve their goals.
It can also be defined as the art of procuring, developing
and maintaining competent workforce to achieve the goals
of an organization in an effective and efficient manner .

Human resource management is therefore focused on a

number of major areas, including: • Recruiting and staffing
• Compensation and benefits • Training and learning •
Labour and employee relations • Organization
development.
HRM is a process of making the efficient and
effective use of human resources so that the set
goals are achieved.

Human Resource Management is the process of

recruiting, selecting, providing orientation,
imparting training and development, appraising
the performance of employees, deciding
compensation and providing benefits, motivating
employees, maintaining proper relations with
employees and their trade unions, ensuring
employees safety, welfare and healthy measures
in compliance with labour laws .
Definitions of Human Resource
Management
Michael J. Jucius has defined human resources as “a whole
consisting of interrelated, inter-dependent and interacting
physiological, psychological, sociological and ethical
components”.

Leon C. Megginson “From the national point of view human

resources are knowledge, skills, creative abilities, talents, and
attitudes obtained in the population.

Management is a process of planning, decision making,

organizing, leading, motivation and controlling the human
resources, financial, physical, and information resources of an
organization to reach its goals efficiently and effectively.
Flippo
Personnel management, or say, human resource management is the
planning, organising, directing and controlling of the procurement
development compensation integration, maintenance, and separation
of human resources to the end that individual, organisational and
social objectives are accomplished.

Decenzo and Robbins

HRM is concerned with the people dimension in management. Since
every organisation is made up of people, acquiring their services,
developing their skills, motivating them to higher levels of
performance and ensuring that they continue to maintain their
commitment to the organisation are essential to achieving
organisational objectives. This is true, regardless of the type of
organisation-government, business, education, health, recreation, or
social action”.
Inherent Part of Management: Human resource management is inherent in
the process of management. This function is performed by all the managers
throughout the organisation rather that by the personnel department only. If a
manager is to get the best of his people, he must undertake the basic
responsibility of selecting people who will work under him.

Pervasive Function: Human Resource Management is a pervasive function of

management. It is performed by all managers at various levels in the
organisation. It is not a responsibility that a manager can leave completely to
someone else. However, he may secure advice and help in managing people
from experts who have special competence in personnel management and
industrial relations.

Basic to all Functional Areas: Human Resource Management permeates all

the functional area of management such as production management, financial
management, and marketing management. That is every manager from top to
bottom, working in any department has to perform the personnel functions.
People Centered: Human Resource Management is people
centered and is relevant in all types of organisations. It is
concerned with all categories of personnel from top to the bottom
of the organisation. The broad classification of personnel in an
industrial enterprise may be as follows : (i) Blue-collar workers
(i.e. those working on machines and engaged in loading, unloading
etc.) and white-collar workers (i.e. clerical employees), (ii)
Managerial and non-managerial personnel, (iii) Professionals
(such as Chartered Accountant, Company Secretary, Lawyer, etc.)
and non- professional personnel.

Personnel Activities or Functions: Human Resource

Management involves several functions concerned with the
management of people at work. It includes manpower planning,
employment, placement, training, appraisal and compensation of
employees. For the performance of these activities efficiently, a
separate department known as Personnel Department is created in
most of the organisations.
Continuous Process: Human Resource Management is
not a one shot‘ function. It must be performed
continuously if the organisational objectives are to be
achieved smoothly.

Based on Human Relations: Human Resource

Management is concerned with the motivation of
human resources in the organisation. The human beings
can‘t be dealt with like physical factors of production.
Every person has different needs, perceptions and
expectations. The managers should give due attention
to these factors. They require human relations skills to
deal with the people at work. Human relations skills are
also required in training performance appraisal, transfer
and promotion of subordinates.
 Objectives of HRM
• The primary objective of HRM is to
ensure the availability of right people for
right jobs so as the organisational goals
are achieved effectively.
• To help the organisation to attain its goals
effectively and efficiently by providing
competent and motivated employees.
• To utilize the available human resources
effectively.
• To reconcile individual/group goals with
organisational goals .
• To increase to the fullest the employee’s job
satisfaction and selfactualisation.

• To develop and maintain the quality of work

life (QWL) which makes employment in the
organisation a desirable personal and social
situation.

• To help maintain ethical policies and

behaviour inside and outside the organisation.

• To establish and maintain cordial relations

between employees and management
 HRM Objectives
1. Societal Objectives
a) Legal Compliance b) Benefits c) Union- Management
Relations.

2. Organizational Objectives
a) HR Planning b) Employee Relations c) Selection d)
Training & Development e) Appraisal f) Placement d)
Assessment.

3. Functional Objectives
a) Appraisal b) Placement c) Assessment

4. Personal Objectives
a) T& D b) Appraisal, Placement c) Compensation,
Scope Of HRM
Control -
Human Resource Audit
Human Resource Accounting
Human Resource Information System

Acquisition-
Human Resource Planning
Recruitment
Selection
Placement
 Development –
Training
Career Development
Organizational Development
Internal Mobility

Maintenance-
Remuneration
Motivation
Health & Safety
social Security
Industrial relations
Performance Appraisal
EVOLUTION OF HRM
 1. The Commodity concept-

 Guild system was beginning of HRM, before Industrial

revolution.

Industrial revolution gave rise to factory system.

Owners separated from managers.

Labor considered as a commodity to be bought and sold.

CONTD..
 2. The Factor of Production System-

 Employees considered as factor of production just like land,

machine and materials.

 Taylor’s scientific management evolved in this phase to

maximize productivity.

 The employees were considered as a mere appendages in

process of production.
CONTD..
 3. The Paternalistic System-

 The employers began to have a protective attitude towards

their employees in lieu of which started providing health,
recreation, welfare schemes.

 Employees joined to form unions, this growing strength gave

impetus to collective bargaining.

 It was as a favor from employers to employees.

CONTD..
 4. The Humanitarian System-

 Here belief was that employees had certain rights as human

beings and it’s the duty of employer to protect those rights.

 5. The Human Resource Concept-

 Employees were considered as valuable assets .

 Efforts made to integrate employees with the organization so

that organizational goals as well as individual aspirations could
be achieved simultaneously.
CONTD..
 6. The Emerging Concept-

 Employees considered as Partners, given share in company’s

stock membership.

 Worker’s representatives appointed on board of directors.

 The concept of industrial relations, HRD etc. are the emerging

concept.
Managerial Function: Planning
• Planning is a predetermined course of actions.

• It is a process of determining the organisational goals

and formulation of policies and programmes for
achieving them.

• Planning is future oriented concerned with clearly

charting out the desired direction of business
activities in future.

• It is the process by which management determines

how an organisation should move from its current
Human resource position to desired position.
Managerial Function : Organising
• Organizing is the function of management which follows
planning.

• It is a function in which the synchronization and combination

of human, physical and financial resources takes place.

• The management function of organizing ensures that efforts

are directed towards the attainment of goals laid down in
planning phase in such a manner that sources are optimally
and efficiently used.

• Organizing implies a process which coordinates human efforts

to assemble resources for achieving specified objective.
 Managerial Function: Staffing
Staffing This function deals with the creation and maintenance of human
resources through employment, compensation, benefits, training and
development, and industrial relations measures. It aims to put in place HR
policies in order to deal with wage fixation, working conditions, and
promotional opportunities for prospective employees.

The steps involved in the staff function are-

• Determining the type of people to be hired

• Recruiting prospective employees and selecting the best ones from them.

• Compensating the employees

• Training and developing the employees.

• Setting performance standards and evaluating the employees’ performance .

• Counselling the employees.

Managerial Function : Direction
Directing is an important managerial function which initiates
organizer’s action

It is concerned with managing the members of the organisation.

Directing is the managerial function that consists of those

activities which are concerned directly with influencing, guiding
or supervising the subordinates in their jobs.

Directing is performance oriented and the initiating function of

management that actuates plans and the organization.
Managerial Function : Controlling

• Controlling can be defined as a managerial function to ensure

that activities in an organisation are performed according to
the plans.

• Controlling also ensures efficient and effective use of

organisational resources for achieving the goals. Hence, it is
a goal oriented function.

• Controlling and management control are considered same.

• It is a process of comparing the actual performance with the

set standards of the company to ensure that activities are
performed according to the plans and if not then taking
corrective action.
Operative Functions
The operational functions of personnel
management are related to the specific tasks of
management personnel, namely employment,
development, compensation and relations.  All
these functions work together with management
functions.

The operative functions are those which are taken

on the departmental level or middle level and
mainly concerned about the execution of the plans
and strategies formulated at the managerial level. 
•Procurement: The acquisition of human resource is
the primary function of a manager. It involves the
estimation of personnel requirement, recruitment and
selection of suitable candidates, placement and
orientation of the workforce in the right position.
•Development: To develop the required skills and
talent within the employees, the managers have to use
various training techniques.
•Compensation: Compensation in the form of
remuneration, given to employees instead of their
services to the organisation should be adequate and
fair. The employees are liable to get other benefits
such as a bonus or incentives.
•Integration: Integration means making the
new employees familiar with the organisation
and to their task or process. It introduces them
to the organisational environment and their
colleagues.

•Maintenance: The most important of all is the

retention of the employees which requires
providing them with various benefits and
facilities like PF, life insurance, accidental
insurance, health insurance, pension, gratuity,
allowances and taking other health and safety
measures.
Procurement Development Motivation Integration Maintenance Separation
&
Compensation

Job Analysis Training Job design Grievance redressal Health & safety Retirement

HR Planning Executive Work scheduling Discipline Employee welfare Layoff

development

Recruitment Career planning & Motivation Teams & teamwork Social security Outsourcing
development measures

Selection Human Resource Job evaluation Collective Discharge

development bargaining

Placement Performance Employee

appraisal participation
&
empowerment

Induction & Compensation Trade unions &

orientation administration associations

Internal Mobility Incentives & Industrial relations

benefits.
Strategic Human Resource Management is the
new nomenclature indicating HR is active in Corporate
objective formulation.

SHRM is built around 3 important propositions:

1) The HR of a firm are a major source of competitive

advantage
2) Successful organizational performance depends on a
close fit between business and HR strategy (vertical
fit)
3) Individual HR Strategy should cohere by being linked
to each other to offer mutual support (horizontal fit).
Strategic human resource management is the
connection between a company’s human
resources and its strategies, objectives, and
goals.

The aim of strategic human resource management

is to:

•Advance flexibility innovation, and competitive

advantage.
•Develop a fit for purpose organizational culture.
•Improve business performance.
In order for strategic human resource management to be
effective, human resources (HR) must play a vital role as
a strategic partner when company policies are created and
implemented.

Strategic HR can be demonstrated throughout different

activities, such as hiring, training and rewarding
employees.

Strategic HRM, or ‘people strategy’, is about creating a

coherent planned framework for employees to be hired,
managed and developed in ways that supports an
organisation’s long-term goals.
 It focuses on longer-term people issues, matching
resources to future needs, and large-scale concerns about
structure, quality, culture, values and commitment.’
Strategic planning is the formal process that takes place,
usually in larger organisations, defining how things will be
done.

Strategy, by contrast, exists in all organisations (even if it’s

not written down and articulated) and defines the
organisation’s behaviour and how it attempts to cope with
its environment.
Strategic HRM can include a
number of individual HR strategies,
for example:

•To deliver fair and equitable

reward.
•To improve employee
performance.
•To streamline organisational
structure.
• HR Manager acts as a strategic
partner:
• HR can play a vital role, especially in
identifying and analyzing external
threats and opportunities.
• HR can also offer competitive
intelligence that may be helpful while
giving shape to strategic plan.
• HR can also throw light on company’s
internal strengths and weakness.
 HRM: Indian Perspective &
Challenges
The management has to recognize the important role of
Human Resource Department in order to ensure that
HR Dept. steer organizations towards profitability.

A new and constantly evolving branch within the field

of human resource management, Strategic Human
Resource Management deals with utilizing recruiting
in a manner that enables a firm to reap long-term
benefits, in terms of profits, core competence, as well
as other goals.
Functions of Human Resource Department.
Nothing is stable or products, services or
persons. Some companies rotate their HR
employees through various HR subspecialties
(Compensation ; other grievances; Morale
boosting and incentives) .

EMERGING ISSUES IN HRM:

From that old times of being the "Personnel"
department for the strategy focused HR
department, HR is constantly changing.
At this level, HR becomes responsible for identifying
core competencies required for business opportunities
their organization to attain leadership position.

In most companies, the challenging decision of

promotion to a greater pay grade is a basic human
resource dependence on consistent employment as a
possible extension agent.

Human resource management have changed the way of

work, as organizations tend to be more relied on HRM to
increase the success ratio in today's competitive global
environment.
 PERSONNEL MGT HRM

Mgmt of people employed Mgmt of KSA, attitudes.

Man is an economic resource/service

exchanged for wage / salary Man is an economic, social & psychological

Commodity that can be purchased & Treated as a valuable resource

used

Employees are cost centers, mgmt Profit centre- invest capital for
controls cost development & future use

Used organisational benefit Used for organisation, individual & family

benefit

Auxiliary function Strategic mgmt function