BASIC HUMAN RESOURCE BASIC HUMAN RESOURCE MANAGEMENTMANAGEMENT

MODULE I

HUMAN RESOURCE PLANNINGHUMAN RESOURCE PLANNING

CP 205

TOPIC : 1

COURSE COVERAGE

• Evolution of HRM as a subject

• HRM functions

• Roles

• Process

What is HRM?Human Resource Management is a series of integrated decisions that form the employment relationship; their quality contributes to the ability of the organizations and the employees to achieve their objective.

__________George T.Milkovich & Johri W.Boudreau

 Human Resource Management 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. __________David A Decenzo & Stephen P Robbins

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.

__________Edwin B Flippo

Relationship of HR to other Related Fields

Theoretical

Organisational

Theory

(OT)

Organisational

Behaviour

(OB)

Organisational

Development

(OD)

Human Resource

Management

(HRM)

Macro Micro

Applied

Evolution of HRM in India• Labour Officer : - Recruiting - Record keeping - Labour laws

-Statutory Requirements - Working Conditions - Safety - Welfare

# Tata Steel Works, Jamshedpur (Mr Naoroji)

# Royal Commission on Labour, 1931 – recommended Labour Oficer for factories

# Bombay Mill Owners’ Association, 1935

# Indian Jute Mills Association, 1936

• Labour Welfare Officer : Statutory Requirements under Factories Act, 1948 and Mines Act, 1952 – 500/more workers

• Personnel Officers/managers (Legal Experts) [ Rise of TUs: Increase in Legal process] – Time keeping - Security - Wage - Administration

• Early 60s : Management Schools : Specialists

- Legal, Organisational, Personnel Related

-Support to Operations as subsidiary & not as direct contributing team member

• Open Organisational Culture, Environment of Trust & Dependence, Freedom of Decision Making, Motivated Employees

HUMAN RESOURCE MANAGEMENT : Pro-active function

Evolution of HRMResearcher Kathryn D McKee has identified the categories of change into 4 distinct periods:

      Mechanistic period : 1940s & 1950s - manufacturing : driving force in the industry; birth of personnel/IR profession. Administrative role

      Legalistic period : 1960s & 1970s - legislation in social and employment area. T& D emerged as a separate and specialised area of HR

Labour RelationsLabour is a separate ClassNeeds to be strongly dealt withOnly a pair of hands have been hiredCarrot and stick way of management

   Organistic Period : 1980’s – tremendous organisational change due to globalisation, mergers, acquisitions, re-engeneering, downsizing. Height of HRM specialisation – movement towards cost and profit centres, more command and control policies

1970’s to 1980’s : Focus on Quality of Work LifeGrowing dissatisfaction among workers with unchallenging jobs and heavy-handed management prompted managers to rethink the way work was organized and managed Moreover, several recessions, deregulation, and mounting foreign competition brought considerable pressures to bear on managers. Management learned that quality, not only cost, was a key to market success. New initiatives, such as self-managed work teams, increased the value of people to management, (hence the shift from the term “personnel management” to “HRM”) and opened the door to a new conceptualization of how work is organized and the role of HR specialists

Strategic Period: 1990’s – strategic thinking and planning emerged HRM - true strategic partner, reporting to CEO and interacting with the Board of Directors

   Catalytic period: beyond 2000 – issues to play important role are:

-         increase in cross border employment

-         workforce comfortable in other cultures

-         fewer organisations (result of mergers & acquisitions)

-         use of just in time professional workers

-         increase in outsourcing of administrative functions

-         more innovative compensation practices

-     more selective approach by employees regarding their careers

-      flexibility of work being widely introduced

- teams playing a major role

1990’s -> onwards

Focus on TQM & Globalization

Trying to stay competitive, many companies took up TQM and re-engineering.

HR departments became more focused on serving external and internal customers, lowering costs through process improvements, and facilitating organizational change and organizational learning initiatives

Evolution from Personnel/IR Deptt to HRM/HRD

• Mere Substitution

•Modern & up-to-date with new concepts enhanced status & power

•More integrated approach within Personnel Tasks; Training – Important

•Personnel functions – Integrated with Business requirements & strategies; HR well accounted for

•Real conversion (Qualitatively different from traditional approach)

# HRM encompasses all employees

# Linked to Strategic Management – policies, procedures, processes

# Commitment # Individual # Initiatives by all

PM & HRM DIFFERENCESPM

Time& planning perspective

• Short-term, ad-hoc, marginal

Psychological contrast

• Compliance

Control system : External

Employee Relations

• Collective, low trust

Role

• Specialist/Professional

Evaluation

• Cost minimisation

HRMTime& planning perspective• Long-term, pro-active,

strategic, integratedPsychological contrast• CommitmentControl system : SelfEmployee Relations• Individual, high trustRole• Largely integrated into line

mgmtEvaluation• Maximum utilisation

Scope

• From entry to exit

• Strategic

Structure of HR Deptt• Place of HR Deptt in overall set up

- Small organisation

Manager

Production Mgr Sales Mgr Office Mgr Accountant

Personnel Assistant

- Large scale Organisation

CMD

Director -Prodn Director- Fin Director- HR Director - Mkt

HR Function in a Corporate

CMD

Dir ( HR )

GM ( Vigilance )GM ( CSR ) GM ( PR ) GM ( HR ) GM (HRD)GM ( Admin & Welfare )

VARIOUS DESIGNATIONS IN HR

DIRECTOR – HR GM – HR / ED – HR DGM – HR

SENIOR MANAGER – HR CHIEF MANAGER – HR

MANAGER – HR DEPUTY MANAGER – HR

PERSONNEL OFFICER SENIOR PERSONNEL OFFICER

FunctionsOBJECTIVES : of HR functions include:• Effective utilisation of Human resources• Desirable working relationship• Maximum individual development

Traditionally the functions are:

• Attracting and retaining talents through Selection & Staffing• Creating and running systems and processes for managing people

through: training and development compensation and rewards management rewards performance management industrial relations management Human Resource Information Systems management

FunctionsCurrently, the functions are:

• Helping an organisation achieve its business objectives through designing, developing and implementing people and performance management strategies through:

1.Human Resource Planning : Job Analysis, Forecasting & Inventory, Recruitment & Selection, Placement & Induction

2. Human Resource Development : Performance Appraisal, Training, Motivation, Management Development, Career Planning, Organisational Development

3. Compensation Management : Job Evaluation, Wage & Salary Administration, Incentives, Social Security

4. Employee Relations : Relations with Trade Unions, Communication, Negotiation, Grievance handling, Counselling

5. HR Evaluation : Audit, Research & Analysis, HR Accounting

Dave Ulrich’s Quotation

• "Essentially, what’s happened is that the field of HR has begun to split into two parts. One half consists of administrative and transactional work, which is becoming more automated and routine and is increasingly being turned over to employee self-service or outsource providers. The second half consists of transformational work, in which HR develops organizational goals, determines what capabilities are needed to meet those goals, and then creates HR practices that make those capabilities come to life.

  In the changed scenario, mgmt and HR professionals must become partners in decision making and share accountability for organising the work to be performed including where it is to be performed. To be successful HR professional will have to :

      Become involved with line managers in strategy formulation and implementation, resulting in the design of HR strategies that will support the overall company strategy

      Become an expert in the way work is organised and executed

   Become involved in reducing costs through administrative efficiency while at the same time maintaining high quality; this can be done by delivering state of the art innovative HR practices

Present Role of HR Managers

Become a reliable representative for employees when putting their concerns to management

    Become involved in efforts to increase the employees contribution to the organisation

Become an agent for continuous transformation, shaping processes and culture to help organisation improve their capacity for change

Dave Ulrich has proposed a multiple role model for HRM. He has proposed that for HR to be successful it has to play 4 different roles1.      Strategic partner2.      Administrative partner3.      Employee Champion4.      Change Agent

HR Roles

P

R

O

C

E

S

S

E

S

FUTURE/STRATEGIC FOCUS (SHORT-LONG TERM)

P

E

O

P

L

E

Cell 1

Mgmt of Strategic Human Resources

Deliverable/Outcome:

Executing Strategy

Activity : Aligning HR and Business Strategy: ‘Organisational Diagnosis’

Role : Strategic Partner

Cell 3

Mgmt of Transformation & Change

 Deliverable/Outcome:

Creating a renewed Organisation

 Activity : Managing Transformation & Change: ‘ensuring capacity for change’

Role :Change Agent

 Cell 2

Management of firm infrastructure

 Deliverable/Outcome :

Building an efficient infrastructure

Activity : Re-engineering organisation processes: ‘shared services’

 Role :

Administrative expert

Cell 4

Management of Employee contribution

Deliverable/Outcome : Increasing Employee Commitment & Capability

Activity :

Listening & responding to employees: ‘providing resource to employees’

 Role :

Employee Champion

DAY-TO-DAY/OPERATIONAL FOCUS

HR PROCESS MODELORGANISATIONALOBJECTIVES

ENVIRONMENTAL

INFLUENCE

HRP + RECRUITMENT + SELECTION + SOCIALISATION = COMPETENT EMPLOYEES WHO HAVE ADAPTED TO THE ORGN’S CULTURE + T&D + CAREER DEVELOPMENT = COMPETENT EMPLOYEES WITH UP TO DATE SKILLS AND KNOWLEDGE + MOTIVATION + PERFORMANCE APPRAISAL + REWARDS & PUNISHMENT = COMPETENT EMPLOYEES WHO DESIRE TO EXERT HIGH EFFORT + BENEFITS & SERVICES + SAFE & HEALTHY WORKING CONDITIONS + SATISFACTORY EMPLOYEE RELATIONS = COMPETENT EMPLOYEES WHO ARE COMMITTED TO THE ORGANISATION AND SATISFIED WITH THEIR JOBS = EFFECTIVE HRM LEADING TO HIGH PRODUCTIVITY, LOW TURNOVER, LOW ABSENTEEISM, HIGH JOB SATISFACTION CHANGING CONDITIONS REQUIRE ON-GOING RESEARCH & CONCERN FOR THE FUTURE

CORPORATE EXAMPLE• General Motors• VP, Global Human Resources - first time in the company’s

history that an HR person reported directly to the CEO. • Ms Barclay launched a company-wide HR transformation

effort involving standardizing processes, creating HR centers of excellence, & outsourcing routine activities.

• In a company with 362,000 global workers in 58 countries, a change of this magnitude is time taking but the CEO is committed to the change.

• A key part of GM’s global HR transformation involves developing HR people so that they understand and can take on the role of internal consultants.

• 15 to 20 courses are mandatory for all HR professionals which would help them acquire business acumen, change-management skills, and the ability to forge relationships across the organization.

CORPORATE EXAMPLE (Cont’d)

• By training its HR people to understand and address business issues, Barclay is slowly transforming the way the function operates. Therefore, in future when a business unit is having trouble achieving its goals, GM’s HR people will be able to work with that unit to diagnose its problem

• GM is also training its line managers to understand that HR is there to help with strategy, not transactional work. A global HR Web site houses materials the HR people can use with their operating leaders to help those leaders understand how HR is changing, why it needs to, and why the value equation is better for the company

• A key part of the HR transformation at GM involves transferring responsibility for HR activities to line unit managers with the help of technology. For example, compensation plan for 40,000 employees could be implemented by managers entirely over the Web without any intervention from HR. This experience helped managers understand how HR is working differently now.

CONCLUSION

Research from Watson Wyatt’s Work USA 2002 study indicates that companies with effective HR practices deliver shareholder returns that are three times higher than those of companies without such practices.