1 THE FIRST CULTURE

CHAPTER 1
THE PRACTICE OF HRM
1. INTRODUCTION TO HRM
1. Human Resource Management (HRM) may be seen as activities related to the
management of people in organizational set up.
2. HRM may be defined as: 'a strategic approach to managing employment relations which
emphasizes that leveraging people's capabilities is critical to achieving sustainable
competitive advantage, this being achieved through a distinctive set of integrated
employment policies, programmes and practices.' (Bratton & Gold, 2007)

3. As this definition suggests, the term HRM is often associated with both:

(a) An orientation towards personnel management, viewing its role as proactive, system-
wide interventions, linking HRM with strategic planning and cultural change; and

(b) An orientation towards the employment relationship, embracing distinctive people-

centered values such as trust, commitment, involvement and collaboration.

4. The main features of HRM may be summed up as follows (Armstrong, 2009).

(a) The attempt to achieve strategic 'fit' or integration between HR and business planning:
(b) The development of coherent, mutually-supporting HR policies and practices

(c) An orientation towards commitment:

(d) The treatment of people as assets rather than costs:

(e) A unitarist approach to employee relations,

(f) The responsibility of line management for delivery of HRM objectives.

Goals of HRM

5.(a) Strategic integration– 'the ability of organisations to integrate HRM issues into their
strategic plans,

6.(b) High commitment – people must be managed in a way that ensures both their genuine
'behavioural' commitment to pursuing the goals of the organisation and their 'attitudinal'
commitment,

7.Flexibility– HRM policies must be structured to allow maximum flexibility for the
organisation, so it can respond to ever-changing business needs.
 2 THE FIRST CULTURE

8. The need for flexibility underpins three working practices:

(a) increasing managerial ability to adapt the size and deployment of the workforce in line
with changing demand and supply,

(b) increasing scope for flexible working for individual employees and

(c) raising the quality and/or quantity of workforce output.

9. (c) High quality – the notion of quality must run through everything the organisation
does, 'including the management of employees and investment in high-quality employees,
which in turn will bear directly on the quality of the goods and services provided.'

10. HRM and Personnel Management

Personnel Management was criticized for being reactive and defensive approach to people
management.

In contrast, HRM introduced many new management concepts such as equal opportunity.

2 THE ROLE & STRUCTURE OF THE HRM FUNCTION

11. HR processes (Armstrong (2009))
(a) Strategic HRM – 'defining intentions and plans for the development of HRM practices,
and ensuring that HR strategies are integrated with the business strategy and one another'.

(b) Policy making – formulating and implementing HR policies which set guidelines on how
personnel issues should be handled.

(c) Competency, job and role analysis – developing content and competency frameworks to
support various activities such as organisation and job design, recruitment, appraisal,
training and reward.

(d) Change management – advising on and facilitating the process of change in

organisational structures and systems.

(e) Knowledge management – developing systems for obtaining and sharing knowledge, to
foster organisational learning, innovation and performance.
 3 THE FIRST CULTURE

12. Roles of HR management

(a) Guidance role – offering specialist recommendations and policy frameworks to guide line
management decisions:

(b) Advisory role – offering specialist information and perspectives to line

(c) Service role – providing services to a range of internal customers.

(d) Control/auditing role – analysing personnel indices

(e) Planning/ organizing role –in human resource forecasting and planning, developing
flexible working methods and so on.

13. At a more strategic level of HRM, HR practitioners may also take on additional roles as:

(a) Strategists: helping to fulfill the business objectives of the organisation through strategic
management of the human resource and influencing business planning.

(b) Business partners: sharing responsibility with senior and line management for the
success of the enterprise.

(c) Internal management consultants: working alongside line managers in analysing

business processes and systems, diagnosing and exploring problems, recommending
solutions.

14.Outsourcing HR tasks

Purchasing non-core support services and functions from a range of 'peripheral' sources.

15. The main areas to effective outsourcing include:

(a) Training and development

(b) Recruitment ( and some aspects of selection, such as screening or testing )

(c) Health and safety monitoring and advice

(d) Employee welfare and counselling

(e) Payroll management (and related benefit schemes, pension’s administration and so on)

(f) Legal advice on compliance.

 4 THE FIRST CULTURE

3 MODELS OF HRM
16. The 5 - P model of HRM ( Schuler (1992))

1. HR philosophy – a statement of how the organisation regards its human resources, the
role they play in the overall success of the business, and how they should be treated and
managed.

2. HR policies – these provide guidelines for action on people-related business issues and for
the development of HR programmes and practices based on strategic needs.

3. HR programmes – these are shaped by HR policies and consist of coordinated HR efforts

intended to initiate and manage organisational change efforts prompted by strategic
business needs.

4. HR practices – these are the activities carried out in implementing HR policies and
programmes. They include resourcing, learning and development, performance and reward
management, employee relations and administration.

5. HR processes – these are the formal procedures and methods used to put HR strategic
plans and policies into effect.

17.Theory X and Theory Y (McGregor, 1987)

(a) Theory X holds that human beings have an inherent dislike of work and will avoid it if
they can. People prefer to be directed, wishing to avoid responsibility. They have relatively
little ambition and want security above all, resisting change.

(b) According to Theory Y, The ordinary person does not inherently dislike work: according
to the conditions, it may be a source of satisfaction or deprivation. A person will exercise

Theory X embodies the 'hard-tight' control theory of management, while Theory Y

embodies the 'soft-loose' commitment theory of management.
 5 THE FIRST CULTURE

18. The Four Cs (‘Harvard Model’)

(a) Commitment – that is, employees' identification with the organisation, loyalty and
personal motivation in their work. This may be assessed through methods such as attitude
surveys, exit interviews and analysis of presumed effects (such as absenteeism and labour
turnover).

(b) Competence – that is, employees' skills and abilities, training needs and potential for
performance improvement and career development. This may be measured through skill
audits, competency testing and performance appraisal systems.

(c) Congruence – that is, the harmonisation of the goals, values and efforts of management
and employees such as the quality of employee relations, the incidence of grievance and
disciplinary action, conflict and communication and so on.

(d) Cost-effectiveness – that is, efficiency, whereby HRM objectives are met and benefits
obtained at the lowest input cost.

4. STRATEGIC HRM
19. Strategic human resource management (strategic HRM or SHRM) is an approach to the
development and implementation of HR strategies that are integrated with business
strategies and support their achievement.