Unit I N
Unit I N
UNIT I
Human Resource Management is concerned with competing for the competing on human
resources to achieve competitive advantage:
HRM is the process of bringing people and organization together so that the goals of each are
met.
“Human Resource Management may be defined as the art of procuring, developing and
maintaining competent workforce to achieve the goal of organization in an effective and efficient
manner.”
1. Pervasive Force – HRM is pervasive in nature. It is present in all enterprises and at all
levels of management.
2. Action Oriented – HRM focuses attention on action rather than an record keeping ,
written procedures or rules. The problems of employees are solved through rational
policies.
4. People Oriented – HRM deals with people at individual and group level. It tries to put
the people an assigned job in order to produce good results.
6. Integrating Mechanism – HRM tries to build and maintain cordial relations between
people working at various levels in the organization.
7. Auxiliary Function – HR department exist to assist and advice the line or operating
managers to do their personnel work more effectively. An HR manager is the specilise
advisor i.e it is a staff function.
9. Continuous Function – HRM is not a one short deal. It cannot be practiced only one
hour each day or one day a week. It requires constant alertness and awareness of human
relation and their importance in every day operations.
Objectives of HRM-
3. To provide the organization with well trained and well motivated employees
Function of HRM
• Planning- To decide short term and long term plans Procurement- Job Analysis,
& organization Objectives. HRP, Recruitment
Selection, placement
1. Managerial function-
a. Planning- It is the bridge between where we are and where we want to go. This deal
with the determination of the future course of action to achieve desired results.
b. Organizing- this function is primarily concerned with proper grouping of personnel
activities , assigning of different groups of activities to different individuals and
delegation of authority.
c. Directing- this involves supervising and guiding the personnel. To execution the plan
, direction is essential because for without direction there is no destination.
d. Coordinating- organizational objectives will be achieved only if group activities in
the enterprise are coordinated effectively. Coordination of personnel is required at all
level of management.
Task, duties equipments, job codes etc for ex- Qualification, skills
Experience etc.
b. Human resource planning- Making the decision regarding the acquisition &
utilization of human resource.
c. Recruitment- searching for prospective employee.
d. Selection- selecting the fit candidate for the particular job.
e. Placement- matching the employee’s qualifications, skills, experience &interest for
following job offer.
f. Induction- introduces the new employee with the organization’s environment.
i. Training- enhancing the existing knowledge, skills and attitude related to job.
ii. Executive development- Developing managerial skills and prepares for future job.
C. Compensation- It is the process which inspires people to give their best to the organization
through the use of intrinsic (achievement, recognition, responsibility) and extrinsic (job design,
work scheduling) rewards. It includes:
i. job design- organizing task and responsibilities towards having a productive unit of work.
ii. Work scheduling- organization must rely the importance of scheduling of work i.e flex work
hour, work sharing, home work assignment.
iii. Motivation- encouraging and inspiring human resource to get the desired objectives or action.
v. Performance appraisal- appraises the performance of the employee related to employee’s job.
vi. compensation- Money and other benefits received by employee in exchange of work
performed.
d. Maintenance- protecting and preserving the physical and psychological health of employee
through various welfare measures. It includes:
ii. Employee welfare- services and facilities like education, hospital, housing transportation etc.
iii. Social security measures- different kinds of benefits like sickness benefits, maternity benefits
etc.
e. Integration Function- this tries to integrate the goals of an organization with employee
aspirations through various employee oriented programmes. It includes:
i. grievance handling- prompt redressel of any dissatisfaction from the employment or job.
iii. Collective bargaining- process of consultation & exchange of information between employees
& employer that is reach on mutually acceptable agreement to all parties.
iv. Employee participation in management- sharing the decision that is a formal method of
providing an opportunity for every member of organization to contribute his brain as well as his
physical effort to increase the effectiveness.
IMPORTANCE OF HRM-
HRM helps an organization and its people to realize their respective goals.
1. At Enterprise level-
• Good human resource practices can help in attracting and retaining the best people in
organization.
• It help in training people for challenging roles, developing right attitudes towards the job
and the company, promoting team spirit among employees and developing loyalty and
commitment through appropriate reward schemes.
• HRM effectively secures the willing cooperation of employees through motivation,
grievance handling and so on.
2.At the individual level-
• It promotes team work and team spirit among employees.
• It offers excellent growth opportunities to people who have the potential to rise.
• Creating right attitudes among the employees through effective motivation.
3.At the society Level-
• Maintaining a balance between the jobs available and job seekers according to the
qualification and needs.
• Providing suitable and most productive employment
4.At the National Level-
• Effective use of human resources helps in exploitation of natural , physical and financial
resources in a better way.
• People with right skills, proper attitudes and appropriate values help the nation to get
ahead and compete with the best leading to better standard of living.
HRM vs HRD
Human Resource Management (HRM) is a branch of management; that is concerned with
making best possible use of the enterprise’s human resources, by providing better working
conditions, to the employees. It involves those activities that arrange and coordinates the human
resources of an entity. Further, it aims at maintaining good relations at various levels of
management.
Human Resource Development (HRD) is a subset of HRM that keeps focusing on the growth
and development part of the organisation’s manpower.
Role of HR Manager
that employees can communicate their problems freely. This helps improve employee job
satisfaction and retain talent.
4. Resolve Conflict: In every organization, employees come from diverse backgrounds. And
when people with opposite opinions meet, the chances of having a conflict rise
significantly. Whether the issue is between two employees or an employee and the
management, it’s the HR manager who has to intervene and resolve it. Besides, the HR
manager must listen to both parties without being biased or judgmental. They also need to go
to the root of the matter, which includes questioning other employees.
5. Ensure Health and Safety of Employee: Employees are the asset of the organization. Unless
they are safe and healthy, they won’t be able to give their best to the company. Thus, HR
managers need to ensure the health and safety of employees.
The roles of HR managers, in terms of health and safety of employees, include:
• Job description
• Employee’s position in the organization
• Who the employee should report to
• Resources the employee will need to perform the job efficiently
• Individual data related to the post, such as technical skills, work experience, etc.
• Work schedule
• Salary and incentives
• Personal attributes, such as personality, values, and interests
• Job rotation: Transferring employees from one task to another depending on the
requirement and their skills
• Job enlargement: Merging previously distributed (similar) tasks into one job
• Job enrichment: Adding more responsibility to an employee’s job
PRATIMA SHARMA Page 8
Human Resource Management (KMBN 202)
• Creating high-performance working groups: Building teams to complete tasks that require
high levels of performance
8. Hiring Candidates: Finding and hiring the right talent is a very complex process.
Modern HR managers do more than just post job requirements in portals to fill open
positions. They develop strategic solutions to attract the right candidates to fulfill the
demands of the business.
An HR manager might also be responsible for a company’s employer brand reputation—or at
minimum, guiding the branding. From screening potential candidates on job portals
and social platforms like LinkedIn to interviewing them, HR managers have to follow an
organized approach for hiring the best suitable employee for the organization. Once an
applicant is selected, HR managers design offer letters documents, and onboarding
procedures.
9. Training and Development: Hiring the best candidates is just half the job. HR
managers need to train and upskill them to maximize their return on investment.
The type of training and development new employees requires depends on their experience.
For example, if they are freshers, managers might need to arrange for skill-development
training programs to ensure their work meets the industry standards.
Merger: Merger refers to combining of two companies where one new company will continue to
exist. Merger is combining of two or more companies, generally by offering the stockholders of
one company securities in the acquiring company in exchange for the surrender of their stock. It
can also be defined as an arrangement whereby the assets of two or more companies become
vested in or under the control of one company.
Acquisition: Acquisition refers to buying of assets of one company from another company. An
action in which a company buys most, if not all, of the target company's ownership stakes in
order to assume control of the target firm. Acquisition is purchase by one company of controlling
interest in the share capital of an existing company.
Reasons for Mergers & Acquisition: Every merger and acquisition have its own unique reasons
based on the organization goals. Here is a few of them:
• Synergy
• Acquisition of technology, assets or talent
• Increasing capabilities & sharing expertise
• Increased market share
• Diversification of products and services
• Identify leaders from both the companies for effective implementation, transition and
communication of the same to employees.
• Train managers on the nature of change
• Explain new roles to the people
• Orientation programs on policies and procedures
• Orientation programs on performance management, compensation, benefits and welfare
schemes
• Identify the skills of people and mapping them appropriately
• Town halls & Team building activities
Role of HR due to technology Change: HR managers use technology to make their jobs easier
and make better judgments. There's an application for that these days. This is especially true
when it comes to managing employees in a company.
1. Employee Management
Employee management deals with helping employees in achieving their full potential.
Additionally, it also helps the company achieve its objectives. It's a comprehensive process that
encompasses all aspects of human resources. This includes recruitment, payroll management,
and talent management.
An automated employee management system improves all these processes. It allows companies
to have a more standardized, systematic, and formal evaluation process.
More specifically, it provides:
For example, membership management software helps simplify administrative tasks. This
includes handling dues payments and accounts receivable. Such tasks can be completed within
minutes with the right tools. By using such software, a company can meet its goals without
sacrificing employee satisfaction.
HR technologies that boost management and improve efficiency, such as taking the hassle out of
payroll using a gross-up calculator, resulting in the overall success of the company. Regardless
of their size or industry, organizations are striving to improve organizational performance.
Managers should make sure that all departments are improving their procedures and controls.
They should also have their operations focused on enhancing the company's competitiveness. All
of these can happen with tools like association management software.
2. Employee Engagement
Employee engagement applications are increasingly being used in performance management.
These platforms and apps employ a range of strategies to keep employees engaged in their work.
3. Performance Management
Employers have also started to automate processes for monitoring employees' job performance.
Most performance management modules usually have interactive features. This allows for
employee feedback in a process known as continuous performance management.
Such performance management can significantly improve employee retention and productivity.
Businesses can start with technology-assisted appraisals. These appraisals keep track of
important information about employees. You can easily and quickly monitor their strengths and
weaknesses. Additionally, it also stores employees’ areas for improvement.
Individual performance management and skills data are used in workforce analytics. Based on
the appraisal results, applications use this data to create tailored learning programs for
employees. These assist employees in planning their career paths and developing their skill sets
effectively.
5. Recruitment
One of the most important functions of HR professionals is to hire people. Different
technological solutions help them in maintaining a seamless recruitment procedure. Today, the
majority of job positions are advertised online. Additionally, applications are processed through
a single platform.
This makes reviewing application forms easier and faster. Recruiters use resume screening
applications to remove submissions that aren't a good fit for the job.
7. Documentation
The HR department is tasked to ensure that employees have timely access to important
information. This increases transparency within the company and fosters a culture of trust. Both
of these are essential for employee productivity.
The best management systems make sharing easier. They ensure that all departments have the
information they require to complete their tasks. This type of technological integration is
important. It helps firms develop a corporate community, track employee behavior, and boost
engagement and productivity.
Strategy means a comprehensive decision plan that sets critical direction for an organization and
guides the allocation of resources.
With long-term planning, capacity building, talent acquisition, organizational design, and
execution appraisal, strategic human resource management assists the HR department in
maximizing the potential of its workers.
It implies that HR practitioners must comprehend its aims and purposes. How they might
effectively assist the company in achieving those objectives and what steps employees may
take to accomplish that.
This post will give you a deeper understanding of how to define strategic human
resource management, its responsibilities, features, importance, etc. We will also be
discussing what strategic human resources management entails and how a well -thought-out
approach can benefit the company.
Strategic HRM
Strategic human resource management is the link between a company's workforce and its
plans, goals, and ambitions. Strategic human resource management has the following
objectives:
Strategic
Human
Strategy HRM
Resource
Management
Strategic HR is part of examining how human capital might directly influence a team's
growth. To satisfy the demands of the long ambitions, Recruiters must take a strategic
approach to employee development and retention.
The goal of SHRM is to create policies and programs that align with the company’s business
strategy. The main difference between human resources and strategic human resources is that
human resources focus on the day-to-day management of employees, while strategic human
resources focus on how employees can achieve the company’s overall goals. This means that
SHRM must first understand the company’s business goals and then create programs and
policies that support those goals.
The HR department is no more a function handling such mundane activities as employee hiring,
training and compensating. The HR manager is no more an individual who heads a department
whose presence is felt when an accident occurs. He or she needs to play a more strategic role-
become a member of strategic management process. More firms are integrating HRM into
strategic management realising the role played by people in contributing to organisational
effectiveness. Organisational and human resource plans and strategies are getting inextricably
linked.
HRM is in a unique position to supply competitive intelligence that may be useful in strategy
formulation. Details regarding advanced incentive plans used by competitors, opinion survey
data from employees, elicit information about customer complaints, information about pending
legislation etc. can be provided by HRM. Unique HR capabilities serve as a driving force in
strategy formulation.
Strategy formulation is preceded by environmental scanning. Scanning helps identify threats and
opportunities prevailing in the external environment. HRM is of great help in locating
opportunities and threats.
A company may build its new strategy around a competitive advantage stemming from its human
resource. The well-known accounting and consulting firm, Arthur Anderson, developed unique
HR capabilities in training. The firm's Illinois training facility is so sophisticated that it provides
the firm with a competitive advantage enabling it to provide fast and uniform in-house training.
Some role of HR in strategic formulation are:
• Working with line management the HR professional identify the culture that is
demanded.
• Identification of key HR practices that is
➢ Flow of people
➢ Flow of performance management
➢ Flow of information
➢ Flow of work
2. Role in Strategy Implementation
HRM supplies the company with a competent and willing workforce for executing strategies. It
is important to remember that linking strategy and HRM effectively requires more than selection
from a series of practice choices. The challenge is to develop a configuration of HR practice
choices that help implement the organization’s strategy and enhance its competitiveness.
HRM supplies the company with a competent and willing workforce which is responsible for
executing strategies. Maruti Udyog and Hindustan Motors are manufacturing cars, essentially
using identical technology. The secret behind the meteoric rise of Maruti is its workforce.
Additionally, HR function can contribute to strategic plans and actions of the firm in the
following ways:
(A) Encouragement of proactive rather than Reactive Behaviour- Behaviour Being pro-
active means that the firm has a vision of where it wants to go 10 years hence, and has
human resources who help it reach there. Being reactive means confronting problems as
they surface. By being reactive the firm tends to lose sight of the long-term direction. It is
people who can make the firm pro-active or allow it to simply rest on past laurels.
(B) Explicit Communication of Goals Generally, every firm shall have a goal and this must
be communicated to all the employees. Everyone should thinking communicating work
towards reaching the goal. BHEL had the objectives of becoming a leader in goals and
Improving its chosen area of heavy electricals. The goal has been spread down the line
and productivity and quality. according to the CEO, "It is clearly the zeal of people to
work, systematic planning and corporate strategising every five years that have made
BHEL stand taller." The role of HR manager in formulating goals and communicating it
to all is indeed crucial.
(C) Stimulation of Critical Thinking Managers often depend on their personal views and
experiences to solve problems and make decisions. The assumptions on which they make
decisions can lead to success if they are appropriate to the environment in which the firm
operates. However, serious problems can arise if the assumptions are no longer valid. The
strategic HRM process can help a firm critically examine its assumptions and determine
whether the decisions that follow from those assumptions need modification or need to be
held back. To strategise means to think critically. Analytical thinking helps an individual
question established practices, shed shibboleths, search for alternatives and arrive at right
courses of action. By being part of strategic management process, HR manager can
contribute to the critical thinking process of employees.
(D) Productivity as an HR Based Strategy The more productive an organisation, the better
is its competitive advantage. Perhaps none of the resources used for productivity in
organisations are as critical as human resources. Many of the HR functions contribute to
productivity. Pay, appraisal systems, training, selection and job design are HR activities
that directly contribute to productivity.
(E) Quality and Service are HR-based Strategies Besides productivity, other factors
which contribute to a firm's competitive advantage are quality and customer service.
Quality can come from people, and realising this firms are spending vast sum of money
on quality training. Since the early 1980s, firms have recognised the value of W. Edwards
Deming's theories as a way to HR to improve quality.
(F) Proficient Strategic Management depends heavily on competent personnel, better-than
adequate competent capabilities and effective internal organisation. Building a capable
organisation obviously always a top priority in strategy execution. three types of
organisation building actions are crucial:
• Staffing the Organisation includes putting together a strong management team, and
recruiting and retaining employees with the needed expertise and experience.
• Building Core Competencies and Competitive Abilities that will enable effective
strategy execution and then keeping the competence/capability portfolio updated as
strategy and external conditions change.
• Structuring the Organisation and Work Effort by organising business functions and
processes, value chain activities and decision making in a manner conducive to
successful strategy execution.
1. Short term mentality: Short-term mentality and focus on the current performance of
SHRM is the first barrier. Every manager act, long-term focus, because the organization
has been established with long-terms objectives/focus.
2. Strategic inability: Very often SHRM does not think strategically and he cannot think it
due to incapability. This type of inability may arise for many reasons as lack of technical
knowledge, insufficient training and the like.
3. Lack of appreciation: Sometimes top managers do not recognize the activities of
strategic human resource management. So SHR manager does not get interested in doing
any innovative venture. A few appreciations may get them a substantial mental boost up.
4. Failure in understanding the role: General managerial roles may not be fully
understood by be managers. This failure is due to lack of knowledge about the specialty
of a degree of responsibility. This failure may create distance between these managers.
5. Difficulty in quantifying outcomes: Many outcomes may not be quantified. But SHRM
tries to enjoy the contribution. This is not always possible. Participation, work etc. type
function cannot be quantified because of their intangibility.
6. Wrong perception on human assets: Investment in human assets may be regarded as
high risk than that of technology and information. Though these technologies are run by
the human resources. This wrong perception may inhibit the progress.