DEFINITION OF HUMAN RESOURCE MANAGEMENT
It is proposed that we take human resource management to be that part of management concerned with:
1. All the decisions, strategies, factors, principles, operations, practices, functions, activities and methods related to the management of people as employees in any type of organisation (including small and micro enterprises and virtual organisations);
2. All the dimensions related to people in their employment relationships, and all the dynamics that flow from it (including in the realization of the potential of individual employees in terms of their aspirations);
3. All aimed at adding value to the delivery of goods and services, as well as to the quality of work life for employees, and hence helping to ensure continuous organisational success in transformative environments.
FUNCTIONS OF HUMAN RESOURCES MANAGEMENT:
There are two broad functions of H R M. They are
1. Managerial Functions 2. Operational Functions
Managerial Functions:
Managerial functions of Personnel management include planning, organising, directing, co-ordinating and controlling.
Planning:
It is the charting out of programmes and changes in advance in the achievement of organisational goals. Hence, it involves planning of human resources requirements, recruitment, selection, training etc. It also involves forecasting of personnel needs, changing values, attitudes and behaviour of their employees and their impact on the organisation.
Organising:
In the words of J.C. Massie, an organisation is a "structure and process by which co-operative groups of human beings allocated its tasks among its members, identifies relationships and integrates its activities towards a common objective." Given the complex relationships that exist between specialised departments and the general departments, many top managers seek the advice of personnel manager. In this manner, the organisation establishes relationships among the employees so that they can together contribute to the achievement of organisational goals.
Directing:
After planning and organising comes the execution of the plan. The willing and effective co-operation of employees towards the achievement of organisation's goal has to be brought about by proper direction. Identifying and utilising maximum potentials of people is possible through motivation and command. Direction, therefore, is an important managerial function in ensuring optimum employee contribution.
Co-ordinating:
It is the task of matrixing various employees’ efforts to ensure successful goal achievement. The Personnel manager co-ordinates various managers at different levels as far as the personnel functions are concerned.
Controlling:
After planning, organising, directing and co-ordinating, the various activities, the performance is to be verified in order to know, at various points of time, whether the activities are performed as per plans and directions. It involves checking, verifying and comparing actual with the plans, identification of deviations if any and correcting the deviations. Auditing training programmes, analysing labour turnover, overseeing morale surveys, conducting exit interviews are some of the controlling functions of personnel management.
Operative Functions:
The operative functions of H R M relate to employment, development, compensation and relations. All these are interacted by managerial functions. Also, they are to be performed in conjunction with management functions.
Employment:
Employment function is securing and employing the people having required level of human resources essential for achieving the organisational objectives. It involves job analysis, human resources planning, recruitment, selection, placement, induction and handling internal mobility.
Job Analysis:
It is the study and collection of data relating to the operations and responsibilities of a specific job. It includes:
a. Collection of data and information and facts relating to the various aspects of jobs including men, machines and materials.
b. Drawing up of job description, job specification, job requirements and employee specification with which nature, levels and quantum human resources can be finalised.
c. Providing the guidelines, plans and the basis for job design and for all operative functions of H R M.
Human Resources Planning:
This is the process which assures the organisation that it will have adequate number of qualified persons, at requisite times, performing in a way to satisfy the needs of the organisation and also provide satisfaction to the individual employee, so employed.
The process involves:
a. Estimating the present and future requirements of human resources based on objectives and long range plans of the organisation.
b. Calculation of net human resource requirements based on the present availability of human resources.
c. Taking suitable steps to identify, mould, change and develop the strength of existing employees so as to meet the future requirements.
d. Preparation of action plans to acquire the balance human resources from outside the organisation and to develop the existing employees.
Recruitment:
It is the process of searching for future employees (requirement) and ensuring they apply for jobs in the organisation.
It involves:
a. Identification of existing sources of candidates and developing them.
b. Seeking out and identifying new sources of applicants.
c. Motivating the right type of candidates to apply for jobs in the organisation.
d. Ensuring a healthy balance between internal and external sources
Selection:
It is the process of ascertaining the qualifications, experience, skill, knowledge etc. of an applicant to ascertain his / her suitability for the job applied for.
This includes:
a. Developing application blanks.
b. Creating and developing valid and reliable testing techniques.
c. Formulating interviewing techniques.
d. Checking of references.
e. Setting up for medical examination policy and procedure.
f. Line Managers to be involved in the decision making.
g. Sending letters of appointment.
h. Employing the selected candidates, when he reports for duty
Placement:
It is the process of allotting to the selected candidate the most suitable job, as per the job requirements and employee specifications.
This function includes:
a. Counselling the concerned managers regarding the placement
b. Overseeing the follow-up studies, employee performance appraisal to monitor employee adjustment to the job, in the coming days.
c. Correcting wrong / misjudged placements, if any.
Induction and Orientation:
These are procedures by which a new employee is rehabilitated in the new surroundings and introduced to the practices, procedures, policies, people etc. of the organisation.
It includes:
a. Familiarising the employee with company philosophy, objectives, policies, career planning and development, company product, market share, history, culture, etc.
b. Introduce the new employee to the people - his colleagues, supervisors and subordinates.
c. Mould the employee by orientation methods to the new working conditions.
Human Resources Development:
This process involves improving, moulding, and developing the skills, knowledge, creativity, attitude, aptitude, values, commitment etc. based on the present and future job and company requirements.
Performance Appraisal:
It is the continuous and systematic evaluation of individual employees with respect to their performance and their potential for future development. It includes:
a. Enunciating policies, procedures and techniques.
b. Assisting functional managers.
c. Reviewing and summarising reports.
d. Evaluating the effectiveness of various programmes.
Training:
It is the process of transmitting the employees the technical and operating skills and knowledge. It includes:
a. Identification of training needs of the individuals and for the organisation.
b. Developing appropriate training programmes.
c. Assisting and advising the management in the conduct of training programmes.
d. Transmitting requisite job skills and job knowledge to the employees.
e. Assess the effectiveness of training programmes.
Management Development:
It is the process of designing and conducting appropriate executive development programmes so as to develop the managerial and human relations of skills of the employees.
It includes:
a. Identification of the areas in which management development is needed.
b. Conducting development programmes.
c. Motivating executives / managers.
d. Designing special development programmes / assessment procedures for promotions.
e. Utilising the services of specialists - both internal and external for development and / or Institutional (external) development programmes.
f. Evaluating the effectiveness of executive development programmes.
Career Planning and Development:
It is the planning of one's career and implementation of career plans by means of education, training, job search and acquiring of work experience.
It includes:
a. Internal mobility - vertical and horizontal transfers, promotion and demotion.
b. Transfer - process of placing employees in the same level jobs where they can be utilised more effectively as per the needs of the organisation. This also means - developing transfer policies, offering assistance and guidance to employees under transfer orders and evaluating transfer policy periodically.
c. Promotion - it deals with the upward assignment of employees to occupy higher positions (with better status and pay) in consonance with resources of employees and job requirement. The Department must ensure that:
i. equitable, fair and consistent promotions are formulated and administered.
ii. managers and employees are given assistance and guidance on the subject of promotion.
iii. execution of promotional policies are as per policies and procedures.
d. Demotion - is the downward assignment of, an employee in an organisation. The Department must ensure that:
i. equitable, fair and consistent demotion policies are drawn up.
ii. assisting and advising employees regarding demotions.
iii. ensure fair implementation of demotion policies and procedures.
Organisation Development:
The planned process drawn up to improve organisational effectiveness through changes in individual and group behaviour, culture and systems of the organisation - drawing models from applied behavioural science.
Compensation Management:
The process of providing equitable, fair and adequate remuneration to the employees. This per se involves - Job evaluation, wage and salary administration, incentives, bonus, fringe benefits, social security measures and so on.
a. Job Evaluation - the process of determining the relative worth of jobs:
i. Select suitable job evaluation techniques.
ii. Classify jobs in to various categories.
iii. Determining relative worth of jobs in various categories.
b. Wage and Salary Administration - developing and operating an appropriate wage and salary programme. It will necessitate:
i. Initiate a wage and salary survey.
ii. Determining wage / salary rates based on various factors.
iii. Proper administration of Wage and Salary Programmes.
iv. The periodical evaluation of its effectiveness.
c. Incentives - formulation administration and reviewing the schemes of payment of financial incentives in addition to regular wages and
i. Formulation of incentive schemes.
ii. Assisting managers on its operation.
iii. Periodical review to evaluate effectiveness and relevance.
d. Bonus - payment of statutory bonus according to the Payment of Bonus Act, 1965, and its latest amendments.
e. Fringe Benefits - various benefits at the peripheral area of the wage. Organisation provides these primarily to motivate the employees and to meet their contingencies. Benefits include:
i. Disablement benefit.
ii. Housing facilities.
iii. Educational facilities to employees’ children.
iv. Canteen facilities.
v. Conveyance facilities.
vi. Credit facilities.
vii. Legal assistance.
viii. Medical, maternity and welfare facilities.
ix. Company stores.
f. Social security measures -These measures are in addition to fringe benefits, which include :
i. Workmen's compensation to those workers (or their dependants) who are involved in accidents.
ii. Disablement benefits and allowance.
iii. Dependent benefits.
iv. Retirement benefits like Provident Fund, Pension, Gratuity etc.
Human Relations:
Administering various human resources policies like employment development and compensation and interactions among the employees on one hand and employees and the, management on the other, create a sense of working relationship between workers and management and trade unions.
Basically they are all interactions between human beings. Human relations, is therefore, is an important area in management which integrates people into work situations in a way that motivates people to work together with economic, psychological and social satisfaction thereby increasing their productivity. Hence Human Resources Management functions will centre around:
a. Understanding perception, personality, learning, intra and inter personal relations, inter and intra group relations.
b. Motivating all employees.
c. Promoting employee morale.
d. Developing communication skills.
e. Developing leadership skills.
f. Redressing satisfactorily through a well defined grievance procedure.
g. Handling disciplinary cases by established disciplinary procedures and in all fairness.
h. Providing adequate counselling to solve employees' personal, work and family problems, thereby releasing their stress and strain.
OBJECTIVES OF HUMAN RESOURCE MANAGEMENT
Objectives of Personnel Management are determined by organisational objectives and individual and social goals. Institutions are established to achieve certain specific objectives. The objectives of commercial institutions are mostly to earn profits and of educational institutions are mostly to impart education and conduct research etc. But the fundamental objective of any institution is survival. However, institutions are not satisfied with this goal. They definitely have a further goal of growth and profits.
Institutions acquire and manage resources including human resource to achieve their objectives. The prime tool employed and utilised for this purpose is human resource. Hence the main objectives of Human Resources Management are drawn from the organisational objectives. The other objectives of HRM are to take care of the needs, aspirations, dignity of individual employees and at the same time keeping in mind the socio-economic problems of the community and the country.
The objectives of HRM may therefore be something as below:
1. Create and utilise capable and motivated workforce, to achieve the basic organisational goals.
2. To establish and maintain proper and sound organisational structure and healthy working relationships among all its employees.
3. To ensure the integration of individual group's goals with those of the organisation.
4. To create facilities for individuals and groups to develop so as to be in tune with the growth of the organisation.
5. Proper and optimum utilisation of human resources.
6. Ensuring adequate and equitable wages, incentives and other benefits so that satisfied individuals and groups are motivated to take on challenges.
7. Maintain high employee morale.
8. Continuously upgrading the skill and knowledge levels of employees, by training and development programmes.
9. Ensure opportunity for participation in management to the extent possible.
10. Provide acceptable and effective leadership.
The above objectives will remain pious and perhaps lofty ideals unless sufficient preparations and precautions are not undertaken at various stages.
The prerequisites for achieving the above objectives are:
1. Recruitment of right persons with requisite skills, knowledge and competence.
2. Every employee should be informed of the objectives of the organisation and their individual goals and be explained how achievement of their individual goals contribute to the achievement of organisational goals and objectives.
3. Maintenance of sound human and industrial relations.
4. Formulation and circulation of sound organisational policies defining authority, responsibility and accountability in unambiguous terms.
PERSONNEL VS HUMAN RESOURCES MANAGEMENT
Personnel Management | Human Resources Management |
1. Personnel means persons employed. Personnel management is the management of people, skills employed. | 1. Human Resources management is the management of employees’ knowledge, abilities, talents, aptitudes, creative abilities etc. |
2. Employee in personnel management is mostly treated as an economic man as his services are exchanged for wage / salary. | 2. Employee in human resource management is treated not only as economic man but also as social and psychological man. Thus, the complete man is viewed under this approach. |
3. Employee is viewed as a commodity or tool or equipment which can be purchased. | 3. Employee is treated as a resource. |
4. Employees are treated as cost centres and therefore management controls the cost of labour. | 4. Employees are treated as profit centres and therefore, invests capital for human resource development and future utility. |
5. Employees are used mostly for the organisational benefit. | 5. Employees are used for the multiple benefits of the organisation, employees and their family members. |
6. Personnel function is treated as only an Auxiliary function. | 6. Human resources management is a Strategic Management function. |
SIGNIFICANCE/IMPORTANCE/NEED OF HRM
HRM becomes significant for business organization due to the following reasons.
1. Objective :-
HRM helps a company to achieve its objective from time to time by creating a positive attitude among workers. Reducing wastage and making maximum use of resources etc.
2. Facilitates professional growth :-
Due to proper HR policies employees are trained well and this makes them ready for future promotions. Their talent can be utilized not only in the company in which they are currently working but also in other companies which the employees may join in the future.
3. Better relations between union and management :-
Healthy HRM practices can help the organization to maintain co-ordinal relationship with the unions. Union members start realizing that the company is also interested in the workers and will not go against them therefore chances of going on strike are greatly reduced.
4. Helps an individual to work in a team/group :-
Effective HR practices teach individuals team work and adjustment. The individuals are now very comfortable while working in team thus team work improves.
5. Identifies person for the future :-
Since employees are constantly trained, they are ready to meet the job requirements. The company is also able to identify potential employees who can be promoted in the future for the top level jobs. Thus one of the advantages of HRM is preparing people for the future.
6. Allocating the jobs to the right person :-
If proper recruitment and selection methods are followed, the company will be able to select the right people for the right job. When this happens the number of people leaving the job will reduce as the will be satisfied with their job leading to decrease in labour turnover.
7. Improves the economy :-
Effective HR practices lead to higher profits and better performance by companies due to this the company achieves a chance to enter into new business and start new ventured thus industrial development increases and the economy improves.
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