HUMAN RESOURCE

MANAGEMENT
UNIT 1

HRM CONCEPT

1
 SYLLABUS
Unit I- Introduction to HRM & HRD,
Concept of HRM, Objectives, Process,
HRM vs. Personnel Management,
HRM Vs. HRD, Objectives of HRD,
focus of HRD System, Structure of
HRD System, role of HRD manpower.

2
 HRM has its roots in India
 World’s first management book
Arthashastra talks about:
financial administration
principles for trade & commerce
management of people

 Modern HRM finds its roots in early 20 th

century

3
 PERSONNEL MANAGEMENT
 Traditionally the term personnel management was used to refer to
the set of activities concerning the workforce which included
staffing, payroll, contractual obligations and other administrative
tasks.
 In this respect, personnel management encompasses the range of
activities that are to do with managing the workforce rather than
resources.
 Personnel Management is more administrative in nature and the
Personnel Manager’s main job is to ensure that the needs of the
workforce as they pertain to their immediate concerns are taken
care of.
 Further, personnel managers typically played the role of mediators
between the management and the employees and hence there was
always the feeling that personnel management was not in tune
with the objectives of the management.

4
 PERSONNEL FUNCTIONS
1. The procurement function- obtaining of a proper kind
and number of personnel necessary to accomplish an
organization’s goals.
2. The development function- personnel development of
employees, training.
3. The compensating function- securing adequate and
equitable remuneration to personnel.
4. The Integration function- an “integration” of human
resources with organization through job enlargement, job
evaluation, variable compensation plans, disciplinary
action programs.
5. The maintenance function- maintaining the physical
conditions of employees (health and safety measures) and
employee service programs.
5
 HRM
 Human resource management is concerned with the
development and implementation of people
strategies, which are integrated with corporate
strategies, and ensures that the culture, values and
structure of the organization, and the quality,
motivation and commitment of its members
contribute fully to the achievement of its goals.

 Definition: HRM is the process of acquiring,

training, appraising, and compensating employees,
and of attending to their labor relations, health &
safety, and fairness concern.
6
DIFFERENCE BETWEEN HRM
& PERSONNEL MANAGEMENT
 PM deals with employees, their payroll
and employment laws. On the other
hand, HRM deals with the management
of the work force, and contributes to an
organization’s success.

 HRM basically deals with developing PM

skills. It is HRM that develops a team of
employees for an organization.

7
 While PM is considered to be reactive,
HRM is stated to be proactive.
 PM focuses on administrating people
or employees. On the other hand, the
prime focus of HRM is to build a
dynamic culture.
 PM is independent from an
organization. On the contrary, HRM
forms an integral part of a company
or an organization.

8
HISTORY OF HRM

The Industrial Revolution

Trade Unionism

Scientific Management

Industrial Psychology

HR Movement

Behavioral Science

Employee
Welfare
9
 The Industrial Revolution: Development of
Machinery, Linking power to machines,
establishing factories etc.
 Trade Union: Workers formed their unions to
improve their lots so that management could be
forced to redress grievances.
 Scientific Management: F.W. Taylor: (a)
development of a true science.(b) Scientific
selection and training of workers.(C) Friendly
cooperation between management and workers.
(d) Development of every worker to his fullest
potential.
10
 Industrial Psychology: It stressed on
matching of employees skills with job.
Contributions made to analyze the jobs in
terms of their mental and emotional
requirement and development of testing
devices.
 HR Movement: Researches focused on the
attitude and feelings of workers and their
influence on productivity. The role of informal
groups in industry were highlighted. It was
suggested that interpersonal relationships
should be improved.

11
 Behavioral Science: Research in anthropology ,
sociology, psychology, etc. has provided the
subject matter for HRM. Behavioral Science era
led to the development of new techniques of
motivation and leadership e.g., employee
participation, 2 way communication,
management by objectives etc.

 Employee welfare: With the dawn of welfare

era, scope of HRM increased. It is not only
concerned now with recruitment, selection, and
training of employees. It manages employee
benefits programmes and industrial relations
system in industry.
12
 EVOLUTION OF HRM
 The commodity concept
 The factor of production concept
 The paternalistic concept (Fatherly figure)
 The Humanitarian concept (Employee’s right
to be protected by employer as human being)
 The HR Concept (Valuable assets)
 The Emerging Concept (Employees are
considered as partners in the industry)

13
 HUMAN RESOURCE MANAGEMENT

 With the advent of resource centric organizations in

recent decades, it has become imperative to put
“people first” as well as secure management
objectives of maximizing the ROI (Return on
Investment) on the resources.

 Has led to the development of the modern HRM

function for ensuring the fulfillment of management
objectives and at the same time ensuring that the
needs of the resources are taken care of.

14
 In this way, HRM differs from personnel
management not only in its broader scope but
also in the way in which its mission is defined.

 HRM goes beyond the administrative tasks of

personnel management and encompasses a
broad vision of how management would like
the resources to contribute to the success of the
organization.

15
CHARACTERISTICS OF
HRM
Human Resources are heterogeneous.
(Different people, different personalities,
different needs, attitudes and values).

Human resources are dynamic and behave

differently. (They react to the same
situation in quite different ways).

16
 HR are the most important element in an
organization. The effective utilization of all
other resources depend upon the quality of HR.

 Theterm HR is wider than the term Personnel.

HR include all dynamic components of all the
people at all levels in the organization, whereas
personnel means the employees working in the
organization.

17
 NATURE OF HRM
The various features of HRM
include:
 It is pervasive in nature.
 Focus is on results rather than
on rules
 Tries to help employees develop
their potential fully
 Encourages employees to give
their best to the organization.
18
 It is all about people at work, both as
individual & group.
 Tries to put people on assigned jobs
in order to produce good results.
 Helps organization achieve its goals
by providing competent & well-
motivated employees.
 Helps build & maintain cordial
relations
 Is a multidisciplinary activity, utilizing
inputs drawn from psychology,
economics, etc.

19
 SCOPE OF HRM
The scope of HRM is very wide:
1. Personnel Aspect- manpower
planning, recruitment, selection,
placement, transfer, promotion,
training & development, lay-off &
retrenchment, remuneration,
incentives, productivity, etc.

20
2. Welfare Aspect- working conditions,
amenities such as canteens, creches,
rest & lunch rooms, housing, transport,
medical assistance, education, health &
safety, recreation facilities, etc.

3. Industrial Relations Aspect- union-

management relations, joint
consultation, collective bargaining,
grievance & disciplinary procedures,
settlement of disputes, etc.

21
 OBJECTIVES OF HRM
 To help organization attain its goals by providing
well trained and well motivated employees.
 To employ the skills and knowledge of employees
efficiently and effectively, i.e., to utilize HR
effectively.
 To enhance job satisfaction of employees by
encouraging and assisting every employee to
realize his full potential.
 To establish and maintain productive, self-
respecting and internally satisfying working
relationship among all the members of the
organization.
22
 To bring about maximum development of
individuals by providing opportunities for
training and development.
 To maintain high morale and good HR within
the organization.
 To help maintain ethical policies and behavior
inside and outside the organization.
 To recognize and satisfy individual needs and
group goals by offering appropriate monetary
and non-monetary incentives.

23
 IMPORTANCE OF HRM
As managers none of us would like to make the
following mistakes:

To hire the wrong person for the job.

To experience high turnover .
To find our people not doing their best.
To waste time with countless and useless
interviews.

24
To be quoted under bad example of
unsafe practices.
To have some of your employees think
their salaries are unfair and inequitable
relative to others in the organization.
To allow a lack of training to undermine
your department's effectiveness
To commit any unfair labour practices .

25
LINE & STAFF ASPECT OF HRM
 Line manager:- Gives Orders
 Staff Manager:- Gives Advice

HR Managers’ Duties
A coordinate
A line function function

Staff function
(assist and
advise)

26
MAJOR FUNCTIONS OF HRM

Staffing

Training and Development

Motivation

Maintenance

27
 FUNCTIONS OF HRM

Managerial Operative
Function Function

Planning
Procurement

Organizin Development
g
Compensatio
Directing n

Integration
Controllin
g
Maintenance
28
 PROCUREMENT
Job Analysis

HR Planning

Recruitment

Selection

Placement

Induction

Transfer

Promotion

Separation

29
 DEVELOPMENT
Performance Appraisal

Training

Executive Development

Career Planning &

Development

30
 COMPENSATION
Job Evaluation

Wage & Salary

Administration

Bonus & Incentives

Payroll

31
 INTEGRATION
Motivation

Job Satisfaction

Grievance Redressal

Collective Bargaining

Conflict Management

Employees’ Participation

Discipline

32
 MAINTENANCE
Health

Safety

Social Security

Welfare Schemes

HR Records

HR Research

HR Audit

33
 EMPLOYMENT / STAFFING
 Staffing - Process through which organization
ensures it always has proper number of employees
with appropriate skills in right jobs at right time to
achieve organizational objectives.

 Job analysis - Systematic process of determining

skills, duties, and knowledge required for
performing jobs in organization.

 Human resource planning - Systematic process of

matching the internal and external supply of people
with job openings anticipated in the organization
over a specified period of time .
34
 Recruitment - Process of attracting individuals
on a timely basis, in sufficient numbers, and
with appropriate qualifications, to apply for
jobs with an organization.

 Selection - Process of choosing from a group

of applicants the individual best suited for a
particular position and the organization .

35
 JOB ANALYSIS
 The process whereby jobs are investigated in
sufficient detail to enable (a)recruitment of
people (b)assessment of the performance of
people who are already working.

Job analysis identifies the following

information:

 Detailed breakdown of the duties involved in a

position.
 Skills, knowledge, attitude, attributes and
experience a person should bring to the position.
 Environment condition of the job.

36
JOB ANALYSIS IS OF TWO FORMS:

Job Description
 Critical skills required for the job
 Tasks or performance standard,
 Responsibilities and disciplinary procedures
 Service condition of the job
 Pay rates
Job Specifications
 Describes the requirements of the person for the job
 Abilities
 Educational qualifications
 Special physical and mental skills
 Training
 Experience and others
37
 RECRUITMENT
 Initial attraction & screening of applicants.

Internal Sources
 Job Posting

 Succession Plans

 Referrals

External Sources
 Ads

 Job Placement Agencies

 Internet

 Placement through Colleges and Universities

38
 SELECTION

Application Evaluation Methods of Selection:

 Interviews
 Tests
 Background Investigations
 Medical Tests
Hiring
This is the process of appointing the person selected
for a particular job.
Induction
•Introducing the employee to the organization and
the organization’s culture.
•Introducing the employee to his/her job.

39
 TRAINING & DEVELOPMENT
Employee training
Designed to assist employees in acquiring
better skills for their current jobs.
Employee development
Designed to help organization to ensure that it
has the necessary talent internally for meeting
the future human resource needed.

40
Organization Development

Deals with facilitating system–wide

change in the organization.
Career development
Designed to assist employees in
advancing their work lives. However, it
is a responsibility of the individual, not
of the organization (employee centered).

41
 TRAINING AND DEVELOPMENT

 Training- Designed to provide learners with

knowledge and skills needed for their present jobs

 Development - Involves learning that goes beyond

today's job; it has more long-term focus

 Career development - Formal approach used by

organization to ensure that people with proper
qualifications and experiences are available when
needed

42
 Organization development - Planned process of
improving organization by developing its
structures, systems, and processes to improve
effectiveness and achieving desired goals

 Performance management - Goal-oriented

process directed toward ensuring
organizational processes are in place to
maximize productivity of employees, teams,
and ultimately, the organization
 Performance appraisal - Formal system of
review and evaluation of individual or team
task performance

43
 MOTIVATION
 An employee’s intrinsic enthusiasm about and drive to
accomplish work.

Maintenance-retention of productive employees

 Welfare Administration
 Medical facilities
 Canteen facilities
 Housing facilities
 Transport facilities
 Recreation facilities
 Loan facilities
 Educational facilities
 Various Incentive schemes/clear view of retirement benefit

44
 HEALTH AND SAFETY ADMINISTRATION
 Employees who work in safe environment and enjoy good
health are more likely to be productive and yield long-term
benefits to organization.
 Safety - Involves protecting employees from injuries caused
by work-related accidents.
 Health - Refers to employees' freedom from illness and their
general physical and mental well being.

 Employee assistance programs

 Medical
 Dental
 Accidental
 Educational
 Retirement

45
 COMPENSATION
 Direct Financial Compensation - Pay that person receives
in form of wages, salaries, bonuses, and commissions.

 Indirect Financial Compensation (Benefits) - All financial

rewards not included in direct compensation such as paid
vacations, sick leave, holidays, and medical insurance.

 Nonfinancial Compensation - Satisfaction that person

receives from job itself or from psychological and/or
physical environment in which person works.

46
 MAINTENANCE
 Itis concerned with protecting and promoting
the physical and mental health of employees.
For this , several types of fringe benefits such
as housing, medical aid, educational facilities,
conveyance facilities etc. are provided.

 Social security measures are provided such as;

PF, Pension plans, gratuity, maternity benefits
disablement allowances, group insurance etc.

47
 ROLE OF HR MANAGER
1. PERSONNEL ROLE:
 Advisory
 Manpower planning, recruitment &
selection
 Training & development
 Measurement of assessment of
individual as well as group behaviour
 Performance & potential appraisal

48
2. WELFARE ROLE:
 Research on personnel & organizational
problems
 Managing services, i.e. canteen,
transport, medical, etc.
 Group dynamics, group leadership,
motivation, communication, conflict, etc

49
3. ADMINISTRATIVE ROLE:
 Time keep up

 Salary & wage administration

 Maintenance of HR records.

50
4. LEGAL ROLE:

 Grievance handling

 Settlement of dispute

 Discipline maintenance

 Collective bargaining

 Worker’s participation, joint

consultation.
51
The Changing Environment
of HRM

52
 GLOBALIZATION TREND

Companies dealing across the nation : Sony, Apple, Nike,

Mercedes Benz, Infosys, TCS etc.
More
More More pressure
Globalizati Competiti to be
on on world
class

Do things Make
better & employees
Less more
Expensive productive

53
GLOBALIZATION BRINGS BOTH
BENEFITS AND THREATS.
Benefits to the consumer: Variety of products and
services at low cost (Ex: From
computer to car).

Threat: More competent and knowledgeable people

required, Outsourced from other countries.

Ex: Engineers from Indian IITs, move abroad for projects.

54
 TRENDS IN THE NATURE OF WORK
 High- Tech Job: Eg:-Skilled machinist required.

 Service Jobs: More intellect people required.

 Knowledge work and Human Capital: The

knowledge, education, training, skills, and
expertise of a firm’s worker.
(Management Guru Peter Drucker predicted
several years ago, “ the center of gravity in
employment is moving fast from manual and
clerical workers to knowledge workers”).

55
 Nature of work and facilities
provided.(Ex: Same Software
implication in two different banks but
results came different ).

 WorkForce Demographic Trends: Age,

Education, Family Background.

56
THE CHANGING ROLE OF HRM

Strategic HRM

Creating High-Performance Work

system

Managing technology

57
SOME EXAMPLES OF EMPLOYEE
FRIENDLY HR POLICIES
 TCS offers choice of working in 170
offices across 40 countries. Paternity
leave for adoption of a child, discount on
grp parties, etc
 ICICI Bank identifies talented staff and
offers stock options & quicker
promotions
 WIPRO has “Wings within” program
where existing employees get a chance
to quit their current job & join a different
group firm
58
 INFOSYS fosters a sense of
belongingness through creative, artistic
& social activities for employees & their
family

 Microsoft offers excellent sporting &

wellness facilities. Flexible working
schedules

 M&M Co. institutionalizes a practice

called ‘reverse mentoring’ where young
people are given opportunities to
mentor their seniors.

59
 WHAT IS HRD?
 Human Resources Development (HRD)
as a theory is a framework for the
expansion of human capital within an
organization through the development
of both the organization and the
individual to achieve performance
improvement.

60
 HRD is the integrated use of training,
organization, and career development
efforts to improve individual, group and
organizational effectiveness.
 HRD develops the key competencies
that enable individuals in organizations
to perform current and future jobs
through planned learning activities.
 Groups within organizations use HRD to
initiate and manage change. Also, HRD
ensures a match between individual and
organizational needs.

61
 HRM VS HRD
1. HRD is a sub section of HRM, i.e. HRD is a
section with the department of HRM.
2. HRM deals with all aspects of the human
resources function while HRD only deals
with the development part.
3. HRM is concerned with recruitment,
rewards among others while HRD is
concerned with employee skills
development.
4. HRM functions are mostly formal while HRD
functions can be informal like mentorships.

62
 OBJECTIVES OF HRD
HRD is associated with the following objectives:
 Work Opportunity: HRD provides an
opportunity and a systematic framework for the
development resource in the organisation for
full expression of their talents.
 Development of Traits: HRD is associated
with the development of total personality so
that these can show and use their talent for the
benefit of the organisation.
 Ability development: HRD makes capable
employees. Thus they can develop their
capability by which they can do their present
job easily.

63
 Creative Motivation: HRD manager
motivates employees and improve their
level of performance.
 Good Relation: HRD manager stresses
the need of coordination which is used
for the benefits of himself and for the
benefits of those who come in his/their
touch.
 Develop team spirit: HRD manager
develops the spirit of teamwork; team
work for it is used for the effective
cooperation and coordination of each
employee which ultimately checks
industrial unrest.
64
 Organisational Growth: HRM
manager is responsible for developing
health, culture and effective work plan
which always result in more profitability.
 Human Resource Information: HRM
manager in general keeps all records to
employees working in his organisation;
these can be used at any time when
these are needed.

65
AN HRD SYSTEM MAY INCLUDE
THE FOLLOWING SUB-SYSTEMS
 Performance Appraisal
 Potential Appraisal & development
 Feedback & performance counselling
 Career planning
 Training
 Organization development- creating a
shared mindset
 Rewards & employee welfare
 Quality of work life.

66
 HRD ultimately leads to higher
productivity, lower costs & successful
growth.
 Chinese philosopher, Guanzi wrote:

“When planning for one year

There’s nothing better than planting grain
When planning for ten years
There’s nothing better than planting trees
When planning for a lifetime
There’s nothing better than planting men”

67
FUNCTIONS OF HRD DEPARTMENT
 Develop a HR philosophy
 Inspire line managers to learn & develop
 Plan & design new methods for developing
& strengthening the HR climate.
 Organize HRD effort to achieve business /
social / other goals.
 Implement various HRD sub-systems
effectively
 Work with & inspire the unions &
associations
 Conduct research, surveys & renewals
 Influence HR policies by providing
feedback
68
EVOLUTION OF HRD
 Early apprenticeship programs
 Early vocational education programs
 Early factory schools
 Early training for unskilled/semiskilled
 Human relations movement
 Establishment of training profession
 Emergence of HRD

69
HRD FUNCTIONS
 Providing skill input to apprentices
and trainees
 Identifying training needs and
imparting training
 Outside deputation for competency
enhancement
 Competency mapping
 Organisational development activities
 Conducting sessions and workshops
 Training and development (T&D)
70
THE NEED FOR HRD:
BUSINESS AND ECONOMICS CHANGED

 HRD can be ‘a platform for organisational

transformation,

 a mechanism for continuous organisational and

individual renewal

 and a vehicle for global knowledge transfer’.

71
THE NEED FOR HRD
 Implementing a new policy
 Implementing a strategy
 Effecting organisational change
 Changing an organisation’s culture
 Meeting changes in the external environment
 Solving particular problems

72
THE NEED FOR HRD:
TECHNOLOGICAL CHANGES

 Technological change creates requirements for

training and development

73
THE NEED FOR HRD:
ORGANISATIONAL CHANGE

 Organisations that work in less time will have

a competitive advantage.
 A customer and quality focus will permeate
tomorrow’s superior organisation.
 The arena for an organisation’s planning and
action will be global.
 Business strategies now depend on quality and
versatility of the human resource.
 Work structure and design will change
dramatically.

74
THE NEED FOR HRD: SOCIAL,
LEGAL & OTHER CHANGES
 Social attitudes, legal requirements, industrial
relations and so on generate training and
development needs.
 They demand new skills in the workplace

75
IMPACT ON TRAINING
 Trainingpractices
rapidly changing in
response to
pressures

 Impacting
instruction design,
delivery, and
evaluation
processes

 Globalinterest in E-
learning is growing
76
TRAINING & HRD PROCESS MODEL

77
NEEDS ASSESSMENT
PHASE
 Establishing HRD priorities
 Defining specific training and objectives
 Establishing evaluation criteria

Design Phase
 Selecting who delivers program
 Selecting and developing program
content
 Scheduling the training program

78
IMPLEMENTATION PHASE
 Implementing or delivering the program

Determining program effectiveness – e.g.,

 Keep or change providers?
 Offer it again?
 What are the true costs?
 Can we do it another way?
79
CRITICAL HRD ISSUES
 Strategic management and HRD
 The supervisor’s role in HRD
 Organizational structure of HRD

80
STRATEGIC MANAGEMENT
& HRD
 Strategic management aims to ensure
organizational effectiveness for the
foreseeable future – e.g., maximizing
profits in the next 3 to 5 years
 HRD aims to get managers and workers
ready for new products, procedures, and
materials

81
SUPERVISOR’S ROLE IN
HRD
 Implements HRD programs and
procedures
 On-the-job training (OJT)
 Coaching/mentoring/counseling
 Career and employee development
 A “front-line participant” in HRD

82
ORGANIZATIONAL STRUCTURE
OF HRD DEPARTMENTS
 Depends on company size, industry and
maturity
 No single structure used
 Depends in large part on how well the
HRD manager becomes an institutional
part of the company – i.e., a revenue
contributor, not just a revenue user

83
HR MANAGER ROLE
 Integrates HRD
with organizational
goals and
strategies
 Promotes HRD as a
profit enhancer
 Tailors HRD to
corporate needs
and budget
 Institutionalizes
performance
enhancement

84
HR STRATEGIC ADVISOR
ROLE
 Consults with corporate strategic
thinkers
 Helps to articulate goals and strategies
 Develops HR plans
 Develops strategic planning education
and training programs

85
CHALLENGES FOR HRD
 Changing workforce demographics
 Competing in global economy
 Eliminating the skills gap
 Need for lifelong learning
 Need for organizational learning

86
SUMMARY
 HRD is too important to be left to
amateurs
 HRD should be a revenue producer, not
a revenue user
 HRD should be a central part of
company
 You need to be able to talk MONEY

87
 K. ASHWATHAPA- HRM
 SEEMA SANGHI- HRM (MACMILLAN)
 ARUN MONAPPA
 ANAND PUBLICATION/THAKUR
PUBLICATION
 MAMORIA
 P Jyothi & Venkatesh (Oxford)

88
 HRM MODELS
 HRM models often combine principles of
soft and hard HRM, but with more
emphasis put on one of these two
approaches. Here are the five most
significant HRM models every HR
practitioner should know of.

89
 THE HARVARD MODEL
 The Harvard Model was postulated by
Beer et al (1984) at Harvard University.
 The authors of the model also coined it
the map of HRM territory.
 The Harvard model acknowledges the
existence of multiple stakeholders
within the organization.
 These multiple stakeholders include
shareholders various groups of
employees, government and the
community at large.
90
91
CLASS TEST (20 MARKS)
Q1. Define HRM. What are its
functions?

Q2. State the differences

between HRM & HRD.

Q3. What is the role of an HR

Manager?

Q4. What are the objectives of

HRM? 92