HUMAN RESOURCE MANAGEMENT

1. HUMAN RESOURCE MANAGEMENT Dr. ANANDA KUMAR Professor, Department of Management Studies Christ College of Engg. & Tech., Puducherry, India. Mobile: +91 99443 42433 E-mail: searchanandu@gmail.com

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3. Human Resource Management “HRM is the function performed in organizations that facilitates the most effective use of people to achieve organizational and individual goals.”

4. Human Resource Management “Human resource or manpower management effectively describes the process of planning and directing the application, development and utilisation of human resources in employment” - Dale Yoder “The personnel function is concerned with the procurement, development, compensation, integration and maintenance of the personnel of an organisation for the purpose of contributing towards the accomplishment of that organisation’s major goals or objectives” – Flippo

5. Functions of HRM HRM FUNCTIONS Managerial Functions Operative Functions Controlling Planning Organising Directing Maintenance Compensation Procurement Integration Development

6. A. Procurement • B. Development • Job Analysis • Human Resource Planning • Recruitment • Selection • Placement • Induction and Orientation • Internal Mobility • Training • Executive development • Career planning & development • Succession Planning • Human Resource Development

7. C. Motivation & Compensation • D. Maintenance • Job Design • Work Scheduling • Motivation • Job Evaluation • Performance appraisal • Compensation administration • Incentives & benefits • Health • Safety • Employee welfare • Social security measures

8. E. Integration Function • Grievance redressal • Discipline • Teams and teamwork • Collective bargaining • Employee participation & empowerment • Trade unions • Employers Association • Industrial relations

9. Importance of HRM 1. It helps the organisation to identify correctly its manpower needs 2. It ensures that the organisation does not suffer from either surplus or shortage of manpower 3. It facilitates the selection of the right man for the right job 4. It focuses attention on the development of the skill of every individual in order to make him up-to-date 5. It recognises the need for the appraisal of the employees performance 6. It considers the need to provide incentives to the employees performing well

10. Importance of HRM 7. It gives utmost importance to securing a favourable employee attitude 8. It emphasizes the need for good human relations in every workplace 9. It provides scope for collective bargaining

11. Objectives of HRM 1. To make an optimum utilisation of the human resource of the organisation 2. To ensure that the organisation has the required number staff 3. To establish and maintain a sound organisation structure 4. To reconcile personal and organisational goals 5. To provide scope for the development of personnel 6. To ensure that the employees have higher job satisfaction 7. To provide scope for participation in decision-making

12. Difference b/w Personnel Mgt & HRM 1. Personnel management is a traditional approach of managing people in the organization. Human resource management is a modern approach of managing people and their strengths in the organization. 2. Personnel management focuses on personnel administration, employee welfare and labor relation. Human resource management focuses on acquisition, development, motivation and maintenance of human resources in the organization. 3. Personnel management assumes people as a input for achieving desired output. Human resource management assumes people as an important and valuable resource for achieving desired output.

13. Difference b/w Personnel Mgt & HRM 4. Under personnel management, personnel function is undertaken for employee's satisfaction. Under human resource management, administrative function is undertaken for goal achievement. 5. Under personnel management, job design is done on the basis of division of labour. Under human resource management, job design function is done on the basis of group work/team work. 6. Under personnel management, employees are provided with less training and development opportunities. Under human resource management, employees are provided with more training and development opportunities.

14. Difference b/w Personnel Mgt & HRM 7. In personnel management, decisions are made by the top management as per the rules and regulation of the organization. In human resource management, decisions are made collectively after considering employee's participation, authority, decentralization, competitive environment etc.  8. Personnel management focuses on increased production and satisfied employees. Human resource management focuses on effectiveness, culture, productivity and employee's participation.

15. Nature / Scope of HRM Control Acquisition HR Audit HR Accounting HR Information System HR Planning Recruitment, Selection Placement. Human Resource Management Development Maintenance Training, Career Development, Organisation Development, Internal Mobility. Remuneration Motivation Health & Safety Social Security Industrial Relations Performance Appraisal

16. Environment of HRM Environment comprises all those forces which have their bearing on the functioning of various activities including human resource activities. Environment scanning helps HR manager become proactive to the environment which is characterised by change and intense competition. Two types of environments: 1. Internal environment 2. External environment

17. 1. Internal Environment These are the forces internal to an organisation. Internal forces have profound influence on HR functions. The internal environment of HRM consists a. Unions b. Organisational Culture & Conflict c. Professional Bodies

18. 1. External Environment External environment includes forces like economic, political, technological, demographic etc. these exert considerable influence on HRM. The external environment of HRM consists a. Economic b. Political c. Technological d. Demographic

19. Strategic HRM Strategic human resource management is to ensure that human resource management is fully integrated into strategic planning, that HRM policies cohere both across policy areas and across hierarchies and that HRM policies are accepted and used by line managers as part of their every day work. According to Donald F. Harvey, “Strategic management is that set of managerial decisions and actions that determine the long-term performance of a corporation. It includes environmental scanning, strategy formulation, strategy implementation and evaluation and control.

20. People Management – Indian Scenario In the 50’s there was a strong belief that employees were recruited not to question ‘why’ but only ‘to do and die’. In the 60s, terms like manpower, staff and personnel came to be used and instead of controlling the employees, it became more and more acceptable to manage personnel as it was felt that the productivity of the workers could be improved, if they were organized for the work. While hierarchy, status, authority, responsibility and accountability are structural concepts, in the Indian context, emotions, feelings, empathetic perceptions, impressions influenced people more than anything else.

21. CASE STUDIES:PERFORMANCE APPRAISAL POLICIES Berkely Investments is a reputed finance company having 15 branches in different part of the country. In the home office there are more than 200 employees. This company has a performance rating under which the employees are rated at six months intervals by a committee of two executives. Graphic scales have been used as means of appraisal. The qualities considered are responsibility, initiative, and interest in work, leadership potential, co-operative attitude and community activity. After the performance is evaluated, the ratings are discussed with the concerned employees by their immediate boss who counsels them. The ratings aroused to influence promotions and salary adjustments the employees and also as a criterion for assigning further rating for them.

22. PERFORMANCE APPRAISAL POLICIES Recently three employees of the company called on the company’s president to express their dissatisfaction with the ratings they had received. Their scores and composite ratings had been discussed with them. Because their ratings were comparatively low, they had been denied annual increments in salary. Approximately, two thirds of all the employees received such increments. The aggrieved employees argued that their ratings did not accurately represent their qualifications or performance. They insisted that “community activity” was not actually a part of their job and that what they do off the job is none of the company’s business. They expressed their opinion that employees should organize union and insist that salary increase be automatic.

23. PERFORMANCE APPRAISAL POLICIES The threat of a union caused concern to the officers of the company. This particular experience convinced the top officers that ratings may represent a serious hazard to satisfactory relationship with employees. Even the chief executive finds that performance appraisal is a dangerous source of friction and its hazards outweigh its values; so it should be discontinued altogether. Questions: 1. How far do you agree with the management that performance appraisal should be discontinued?  2. If you were the HR manager, how would you tackle the situation? 3. What modifications would you suggest in the performance appraisal system of the company

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25. Human Resource Planning (HRP) HRP includes estimation of how many qualified people are necessary to carry out the assigned activities, how many people will be available and what, if anything, must be done to ensure that personnel supply equals personnel demand at the appropriate point in the future. - Terry L. Leap and Michael D. Crino Human resource planning is a planning is a process of determining and assuming that the organisation will have an adequate number of qualified persons, available at the proper times, performing job which meet the needs of enterprise and which provide satisfaction for the individuals involved. - Beach

26. Objectives HRP Ensure adequate supply of manpower as and when required. Ensure proper use of existing human resources in the organisation. Forecast future requirements of human resources with different levels of skills. Assess surplus of shortage, if any, of human resources available over a specified period of time. Anticipate the impact of technology on jobs and requirements for human resources. Control the human resources already deployed in the organisation.

27. HRP Process Analysing Organisational Plans and Objectives Analysing Objectives of Human Resource Planning Forecasting Demand for Human Resources Forecasting Supply of Human Resources Matching Demand and Supply Monitoring and Control

28. Human Resource Information System (HRIS) HRIS refers to a computerised system that aids the processing of information relating to human resource management. It is a system of gathering, classifying, processing, recording and disseminating the information required for effective management of human resources in an organisation. HRIS forms an integral part of the Management Information System (MIS). HRIS collects and analyses data relating to human resources of the organisation. The input of HRIS include the information relating to employees, their abilities, qualitifications, potentialities, creative instincts, age, sex, their jobs, pay scales, organisational objectives, policies and procedures, etc.

29. HRP Advantages It is both time saving and cheaper device. It gives accurate information relating to human resources. It makes information readily available as and when desired. It acts as a decision support system. It establishes strong management control.

30. Job Analysis Job analysis is the process of getting information about jobs: specially, what the worker does; how he gets it done; why he does it; skill, education and training required; relationship to other jobs, physical demands; environmental conditions”. Jones and Decothis Job analysis as the process of studying and collecting information relating to the operations and responsibilities of a specific job. The immediate products of this analysis are job descriptions and job specifications”. - Edwin B. Flippo

31. Job Description: Job description is a written statement showing job title, tasks duties and responsibilities involved in a job. Job Specification: Job specification also known as man or employee specification is a statement of minimum acceptable qualities required in a job incurrent for the effective performance of the job.

32. JOB ANALYSIS Job Description Job Specification Job Title: A Title of the Job Job Activities: Tasks performed, materials used. Working Conditions: Light, Heat, Noise. Social Environment: Size of work group members etc. Personal Characteristics: Age, Sex, Education. Physical Characteristics: Length, Weight, Vision. Mental Characteristics: General intelligence, Memory, Judgment. Social & Psychological Characteristics: Emotional Stability, Initiative, Creativity.

33. Job Evaluation Job evaluation is a comparative process of establishing the value of different jobs in a hierarchical order. It allows one to compare jobs by using common criteria to define the relationship of one job to another. This serves as basis for grading different jobs and developing a suitable pay structure for them. It is important to mention that job evaluation cannot be the sole determining factor for deciding pay structures because job evaluation is about relationships, and not absolutes.

34. Job Design Job design as “the process of deciding on the contents of a job in terms of its duties and responsibilities, on the methods to be used in carrying out the job, in terms of techniques, systems and procedures, and on the relationships that should exist between the job holder and his superiors, subordinates and colleagues”.

35. Methods / Techniques Job Design Work Simplification Job Rotation Job Enrichment Job Enlargement

36. WORK DESIGN Job Rotation (relief from boredom) Job Enrichment (Increased responsibility) Job Simplification (Breaking down into small sub-parts) Job Enlargement (Extension of work plus additional tasks to obtain a complete unit)

37. Recruitment Recruitment is the generating of applications or applicants for specific positions to be filled up in the organisation. In other words, it is a process of searching for and obtaining applicants for jobs so that the right people in right number can be selected. Flippo has defined recruitment as “a process of searching for prospective employees and stimulating and encouraging them to apply for jobs in an organisation.

38. Sources of Recruitment Internal Sources External Sources • Employment Exchange • Advertisements • Employment Agencies • Campus Recruitment • Word-of-Mouth • Present Employees • Employee Referrals • Former Employees • Previous Applicants

39. Recruitment Process Recruitment Planning Strategy Development Searching Screening Evaluation and Control

40. Selection Selection is the process of choosing from among the candidates from within the organisation or from the outside, the most suitable person for the current position or for the future position. Selection is hiring the best candidate from the pool of applications. It refers to the process of offering jobs to one or more applicants/candidates from the applications received through recruitment. In other words, it is the process of picking the suitable candidates from the pool of job applications to fill various jobs in the organisation.

41. Selection Methods / Process Preliminary Interview Application Blank Selection Tests Selection Interview Reference Checks Physical Examination Final Selection

42. Placement Placement is understood as assigning jobs to the selected candidates. Assigning jobs to employees may involve a new job or different job. Thus, placement may include initial assignment of job to new employee, on transfer, promotion or demotion of the present employees. In this section, placement refers to the assignment of jobs to new employees only.

43. Induction Induction is welcoming a new employee to the organisation. In other words, it is a well orchestrated event to socialise the new entrant with the people and the work environment in a particular organisation. According to Michael Armstrong, “Induction is the process of receiving and welcoming an employee when he first joins a company and giving him basic information he needs to settle down quickly and happily and start work”.

44. Performance Appraisal Performance appraisal is the process of making an assessment of the performance and progress of the employees of an organisation. Once an employee has been inducted into the organisation and given the necessary training, the next step is to assess his performance periodically. Such an assessment would indicate whether he is efficient or not. Performance appraisal is also known as ‘merit rating’ or ‘efficiency rating’.

45. Performance progress of employee Knowledge of work Extent of co-operation with colleagues and superiors Initiative Quality of work 10. Honesty Target attainment 11. Ambition Aptitude Degree of skill Discipline Punctuality

46. Objectives of Performance Appraisal Salary Increase Promotion Training and Development Feedback Pressure on Employees

47. 360 Degree Appraisal A 360 degree appraisal is a type of employee performance appraisal in which subordinates, co-workers, and managers all anonymously rate the employee. A 360 degree appraisal is a type of employee performance review, where a staffer's work for a specific period of time is discussed and critiqued. The 360 degree process is different in that it obtains feedback from co-workers and subordinates, instead of just from the direct supervisor. The goal of the process is to better understand how the employee is functioning as part of the team, and to improve the ways team members work together.

48. Potential Appraisal The potential appraisal refers to the appraisal i.e. identification of the hidden talents and skills of a person. The person might or might not be aware of them. Potential appraisal is a future – oriented appraisal whose main objective is to identify and evaluate the potential of the employees to assume higher positions and responsibilities in the organizational hierarchy. Many organisations consider and use potential appraisal as a part of the performance appraisal processes. 

49. Methods of Performance Appraisal Ranking method Graphic scale rating method Forced choice method Essay appraisal method Paired comparison method Field review method

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