Ms. Anubha Rastogi

Opening Case

On October 3, 2003, Anant Dalvi and Akhtar Khan, who worked as contract workers in Tata Electric Company until they were laid off in 1996, doused themselves with kerosene and set themselves ablaze even as their co-workers protested before the company’s offices. While Dalvi died on the spot, Khan died a few days later. The Tata Electric Company said they were no longer on their payroll and were not permanent workers. Employees union had taken up their case and filled petition in the Labour Court before their contracts were terminated. The court directed the company not to terminate their services without following the due process of law. Despite this their services were terminated on June 30, 1996. The company union promised the workers that they would renegotiate. Yet on the night before they killed themselves when Khan and Dalvi spoke to the union leader Shinde, they were told that nothing more could be done for them. It is this that led them to take their lives. Dalvi has been in service as a peon for17 years and Khan had been employed for 19 years. But their services were not regularized. Such workers draw salary much less than the permanent employees. This is an example of the problem that comes under the purview of Human Resource Management- the main concept elaborated in this chapter.

• During early ages it was about industrial revolution and machines

• Ever since the genesis of civilization on earth, man has been playing a dominant role in almost every change, development and growth, either individually or by forming groups.

• All major accomplishments in the form of great victories, planning, administering, ruling, inventing, discovering, setting and building great structures and organizations and entering the space even, are the results and human endeavours. HUMAN RESOURCES ASSUME THE TOP PRIORITY

• Organizations from the very beginning needed some natural resources besides capital, goods, technology and systems as material and financial resources along with human resources for carrying their functions and achieving goals. Out of all these resources, human resources are considered the most important who have to make use of other resources."

• While all of these are important to organizational effectiveness, the only factor that represents a potential competitive advantage is human resources and how these resources are managed.

• The value of an organization's human resources frequently becomes evident when the organization is sold. Often, the purchase price in greater than the total value of the physical and financial assets. The difference, sometimes called goodwill, partially reflects the value of an organization's human resources."

What is HRM?•HRM is concerned with the people’s dimension in the organization•Facilitating the competencies and retention of skilled force• Developing management systems that promote commitment• Developing practices that foster team work• Making employees feel valued and rewarded.

HUMAN RESOURCE MANAGEMENT (HRM)

HRM defined as

“HRM is management function concerned with hiring , motivating and

maintaining people in an organization. It focuses on people in

organization” (Aswathappa, 2008, p.5)

HRM refers to acquisition, retention, motivation and maintenance of Human Resources in an organization.

HRM is the planning, organising, directing & controlling of the

procurement, development, compensation integration, maintenance and

separation of human resources to the end that individual, organizational

and social objectives are accomplished.

HRM: Peoples Dimensions In Organizations

• HRM: the application of management functions and principles related to employees

• HRM functions applicable every where (not for profit and profit driven organizations)

• Employees decisions are integrated

• Employee decision brings effectiveness/efficiency in organization

• HRM includes all major activities in professional life of a worker

• All activities from employee entry to managing performance and training until he or she leaves

HRM Activities• HR Planning

• Job Analysis and Design

• Recruitment and Selection

• Training and Development

• Remuneration

• Welfare

• Safe and Healthy Work Environment

• Industrial relations

Nature of Human Resource Management

1. HRM is based on certain principles and policies contribute to the achievement of organisational objectives.

2. HRM is a pervasive function – Human resource management is not specific to an individual department, rather it is a broader function and spread throughout the organisation, it manages all type of people from lower level to top level departments of the organisation.

3. HRM is people oriented – People or human resource is the core of all the activities of human resource management. Human resource management works with and for people. It brings people and organisation together to achieve individual and organisational goals.

4. HRM is continuous activity – All factors of production are required to be continuously updated and improved to cope up with the changes and increased competition. Similarly, human resource also continuously trained, developed, or replaced to face the next level of competition. Hence, it is a continuous activity.

5. HRM is a part of management function.

6. HRM aims at securing maximum contribution.

7. HRM aims at optimum use of personnel power.

8. HRM Involves the Application of Management Functions and Principles.

9.Decision Relating to Employees must be Integrated

10.Decisions Made Influence the Effectiveness of an Organization.

11.HRM Functions are not Confined to Business Establishments Only

Scope of Human Resource Management

1. Personnel Aspect

Human Resource Planning – It is the process by which the organisation identifies the number of jobs vacant (Quantity+Quality).

Job Analysis and Job Design – Job analysis is the systematic process for gathering, documenting, and analysing data about the work required for a job. Job analysis is the procedure for identifying those duties or behaviour that define a job.

Recruitment and Selection – Recruitment is the process of preparing advertisements on the basis of information collected from job analysis and publishing it in newspaper or anywhere else. Selection is the process of choosing the best candidate among the candidates applied for the job.

Orientation and Induction – Making the selected candidate informed about the organization’s background, culture, values, and work ethics.

Training and Development – Training is provided to both new and existing employees to improve their performance.

Performance Appraisal – Performance check is done of every employee by Human Resource Management. Promotions, transfers, incentives, and salary increments are decided on the basis of employee performance appraisal.

Compensation Planning and Remuneration – It is the job of Human Resource Management to plan compensation and remunerate.

Motivation – Human Resource Management tries to keep employees motivated so that employees put their maximum efforts in work.

2. Welfare Aspect – Human Resource Management have to follow certain health and safety regulations for the benefit of employees. It deals with working conditions, and amenities like - canteens, crèches, rest and lunch rooms, housing, transport, medical assistance, education, health and safety, recreation facilities, etc.

3. Industrial Relation Aspect – HRM works to maintain co-ordinal relation with the union members to avoid strikes or lockouts to ensure smooth functioning of the organisation. It also covers - joint consultation, collective bargaining, grievance and disciplinary procedures, and dispute settlement.

1. It helps management in the preparation adoption and continuing evolution of personnel programmes and policies.

2. It supplies skilled workers through scientific selection process3. It ensures maximum benefit out of the expenditure on training

and development and appreciates the human assets. 4. It prepares workers according to the changing needs of industry

and environment. 5. It motivates workers and upgrades them so as to enable them to

accomplish the organisation goals. 6. Through innovation and experimentation in the fields of

personnel, it helps in reducing casts and helps in increasing productivity.

7. It contributes a lot in restoring the industrial harmony and healthy employer-employee relations.

8. It establishes mechanism for the administration of personnel services that are delegated to the personnel department.

So HRM …

Importance of HRM• Human Resource Management is important to all managers despite their

various functions because of the following reasons-

• Hire the right person for the job

• Low attrition rate

• Ensure people do their best

• Time saved in not conducting useless interviews

• Avoid legal action for any discrimination

• Safety laws are not ignored

• Equity towards employee in relation to salary etc.

• Effective training

• Avoid unfair labor practices

Skills Needed for HRM

• The first skill needed is Organization

• Multitask

• A strategic mind-set as an HR professional is a key skill as well

• Ethics and a sense of fairness are also necessary in human resources (EMPATHY)

• Guts

Why Study HRM?

• Taking a look at people is a rewarding experience

• People possess skills, abilities and aptitudes that offer competitive advantage to any firm

• No computer can substitute human brain, no machines can run without human intervention & no organization can exist if it cannot serve people’s needs.

• HRM is a study about the people in the organization-how they are hired, trained, compensated, motivated & maintained.

HRM & Personnel Management

The Semantics: There are two terms

1. PM (Personnel Management )

2. HRM (Human Resource Management )

• PM and HRM are different in scope and orientation

• HRM is broad concept

• PM and HRD (Human Resource Development) are part of HRM

Difference Between HRM and PM

S.No Dimension PM HRM1 Employment contract Careful dimension of

written contractAim to go beyond contract

2 Rules Importance of devising clear rules

Impatience with rules

3 Guide to management action

Procedures Business need

4 Behaviour referent Norms/ customs & practices

Values/mission

5 Managerial task vis-à-vis labour

Monitoring Nurturing

6 Key relations Labour Customer

7 Initiatives Piecemeal Integrated

8 Speed of decision Slow Fast

S.No Dimension PM HRM9 Management role Transactional Transformational

10 Communication Indirect Direct11 Management skill Negotiation Facilitation12 Selection Separate Integrated13 Pay Job evaluation Performance related14 Conditions Separately

negotiatedHarmonisation

15 Labour management Collective bargaining contracts

Individual contracts

16 Job categories and grades

Many Few

17 Job design Division of labour Team work

Difference Between HRM and PM

S.No Dimension PM HRM18 Conflict handling Temporary Climate & culture19 Training &

DevelopmentControlled courses Learning

Organization20 Focus for attention for

interventionsPersonnel procedures

Cultural & structural strategies

21 Respect for employees Labour – a tool – expendable & replaceable

People are assets & to be used for benefit of organization

22 Shared interests Organization interest is uppermost

Mutuality of interests

23 Evolution Precedes HRM Latest

Difference Between HRM and PM

FunctionsFunctions of HRM include:

• Facilitating the retention of skilled and competent employees• Building the competencies by facilitating continuous learning and development• Developing practices that foster team work and flexibility• Making the employees feel that they are valued and rewarded for their contribution• Developing management practices that endanger high commitment• Facilitating management of work force diversity and availability of equal opportunities to all.

Functions of HR

MANAGERIAL FUNCTIONS

Planning

Organising

Directing

Controlling

OPERATIVE FUNCTIONSStaffing

Development Compensation

Motivation Maintenance Integration

Emerging Issues

Operative Functions Of HR

STAFFING Job analysis, HRP, Recruitment, Selection, Placement, Induction, Internal Mobility

DEVELOPMENT Competency profiling, Training and development, Performance & potential management, Career management, 360 degree feedback

COMPENSATION & MOTIVATION

Job design, Work scheduling, Job evaluation, Compensation administration, Incentives and benefits

MAINTENANCE Health, Safety, Welfare, Social security

INTEGRATION Employment relations, Grievance, Discipline, Trade unions, Participation, Collective bargaining

EMERGING ISSUES HRIS, HR audit, HR scorecard, International HRM, Workforce Diversity

Objectives of HRM1. Human capital : assisting the organization in obtaining the right number

and types of employees to fulfil 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

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/employee relationship

5. Helping to create and maintain a safe and healthy work environment

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

8. To provide organization with well-trained and well-motivated employees

9. To increase the employees satisfaction and self-actualization

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.

Societal objectivesTo be ethically & socially responsible to the needs of the society while

minimizing the negative impact of such demands upon the organization Organizational objectives

To recognize the role of HRM in bringing about organizational effectiveness Functional objectives

To maintain the department’s contribution at a level appropriate to the organization’s needs Personal objectives

To assist employees in achieving their personal goals in a manner that their personal goals enhance the individual’s contribution to the organization

HRM and 3 P’s• People – core strength of an organization

Any resource can be replaced but not HR• Processes – evolve over a period of time

IT enabled environment facilitates engineering effortlessly• Performance – the pillars of performance are people and IT

Organizational performance in terms of value creation and return on investment

HRM in the New Millennium

1. HR Can Help in Dispensing Organizational Excellence

2. Human Resource Should be a Strategy Partner

3. HR Accountability Should be Fixed to Ensure Employee Commitment

4. The New HR Must Become a Change Agent

5. Improving the Quality of HR

6. Change in Employment Practices

7. Benchmarking Tool Must be Mastered by HR Professionals

8. Aligning Human Resources to Better Meet Strategic Objectives

9. Promote From Within and Invest in Employees

10. Review the Recruitment and Selection Process

11. Communicate Mission and Vision

12. Use Teams to Achieve Synergy

Questions