HRM SEC 2024 Final PDF

Human Resource Management MSU-CBM (2024) 2 Credits ((SEC- Skill Enhancement Course) HUMAN RESOURCE MANAGEMENT SKILL ENHANCEMENT COURSE (SEC)- 2024 THE MAHARAJA SAYAJIRAO UNIVERSITY OF BARODA HRM-2024...

Human Resource Management MSU-CBM (2024) 2 Credits ((SEC- Skill Enhancement Course) HUMAN RESOURCE MANAGEMENT SKILL ENHANCEMENT COURSE (SEC)- 2024 THE MAHARAJA SAYAJIRAO UNIVERSITY OF BARODA HRM-2024 0 Human Resource Management MSU-CBM (2024) 2 Credits ((SEC- Skill Enhancement Course) UNIT: 01 INTRODUCTION TO HUMAN RESOURCE MANAGEMENT Unit 1: Concept of Human Resource Management (HRM) Definition of HRM Nature of HRM Objective of HRM Scope of HRM Importance of HRM Role of HRM Role of HR manager Human Resource Planning (HRP) Need of HRP Objective of HRP Process of HRP Key Terms References Questions 1 Human Resource Management MSU-CBM (2024) 2 Credits ((SEC- Skill Enhancement Course) 1.1 CONCEPT OF HRM HRM is concerned with the human beings in an organization. The management of man. Though it is a very important and challenging job because of the dynamic nature of the employees. As no two people are similar in nature in every aspect of mental abilities, tacticians, sentiments, and behaviors; they differ widely not only individually but also as a group and are subjected to many varied influences. People are responsive, they feel, think and act therefore they cannot be handled like a machine or shifted and altered like template in a room layout. They therefore need a tactful handling by management personnel. HRM is the process of managing people of an organization with a human approach. Human resources approach that enables the manager to view the people as asset which act as an important resource. It is the approach through which organization can utilize the manpower/human resource not only for the benefits of the organization but for the growth, development and self-satisfaction of the concerned people. Thus, HRM is a system that focuses on human resources development on one hand and effective management of people on the other hand so that people will get human dignity and respect in their employment/workplace. HRM refers to the management of people in organizations. It comprises of the activities, policies, and practices involved in obtaining, developing, utilizing, evaluating, maintaining, and retaining the appropriate number and skill mix of employees to accomplish the organization’s objectives. The goal of HRM is to maximize employees’ contributions to achieve optimal productivity and effectiveness, while simultaneously attaining individual objectives (such as having a challenging job and obtaining recognition), and societal objectives (such as legal compliance and demonstrating social responsibility). Human Resource Management (HRM) can be defined as the art of procuring, developing and maintaining a competent workforce to achieve the goals of an organization in an effective and efficient manner. 2 Human Resource Management MSU-CBM (2024) 2 Credits ((SEC- Skill Enhancement Course) 1.1. Definition In general, Human Resource Management is a management function concerned with hiring, training, motivating, developing and maintaining the workforce in an organisation. Human resource management ensures satisfaction of employees to get maximum contribution of employees for the achievement of organisational objectives. According to Armstrong (1997), Human Resource Management can be defined as a strategic approach to acquiring, developing, managing, motivating and gaining the commitment of the organization‘s key resource the people who work in and for it. According to Dale Yoder the management of human resource is viewed as a system in which participants seeks to attain both individual and group goals. According to Edwin Flippo, Human Resource Management (HRM) is the process of planning, organizing, directing, controlling, procuring, developing, compensating, integrating, maintaining, and separating human resources to achieve individual, organizational, and social goals. According to the Invancevich and Glueck, “HRM is concerned with the most effective use of people to achieve organizational and individual goals. It is the way of managing people at work, so that they give their best to the organization”. According to Dessler (2008) the policies and practices involved in carrying out the “people” or human resource aspects of a management position, including recruiting, screening, training, rewarding, and appraising comprises of HRM. 3  Human Resource Management MSU-CBM (2024) 2 Credits ((SEC- Skill Enhancement Course) Nature of HRM Human Resource Management is a process of bringing people and organisations together so that the goals of each are achieved. It tries to secure the best from people by winning their wholehearted cooperation. In short, it may be defined as the art of procuring, developing and maintaining competent workforce to achieve the goals of an organisation in an effective and efficient manner. It has the following features: i. Pervasive force: HRM is pervasive in nature. It is present in all enterprises. It permeates all levels of management in an organisation. ii. Action oriented: HRM focuses attention on action, rather than on record keeping, written procedures or rules. The problems of employees at work are solved through rational policies. iii. Individually oriented: It tries helping employees to develop their potential to achieve individual goals. It encourages them to give their best to the organisation. It motivates employees through a systematic process of recruitment, selection, training and development coupled with fair wage policies. iv. People oriented: HRM is all about people at work, both as individuals and groups. It tries to put people on assigned jobs to produce good results. The resultant gains are used to reward people and motivate them toward further improvements in productivity. v. Future-oriented: Effective HRM helps an organisation meet its goals in the future by providing competent and well-motivated employees. vi. Development oriented: HRM intends to develop the full potential of employees. The reward structure is tuned to the needs of employees. Training is offered to sharpen and improve their skills. Employees are rotated on various jobs so that they gain experience and exposure. Every attempt is made to use human resource optimum utilization of their talents at the workplace to achieve organisational goals. vii. Integrating mechanism: HRM tries to build and maintain cordial relations between people working at various levels in the organisation. In short, it tries to integrate human assets in the best possible manner in the benefit of an organisation. 4  Human Resource Management MSU-CBM (2024) 2 Credits ((SEC- Skill Enhancement Course) viii. Comprehensive function: HRM is, to some extent, concerned with any organisational decision which has an impact on the workforce or the potential workforce. The term ‘workforce’ signifies people working at various levels, including workers, supervisors, middle and top managers. It is concerned with managing people at work. It covers all types of personnel. Personnel work may take different shapes and forms at each level in the organisational hierarchy but the basic objective of achieving organisational effectiveness through effective and efficient utilisation of human resources, remains the same. “It is basically a method of developing potentialities of employees so that they get maximum satisfaction out of their work and give their best efforts to the organisation”. (Pigors and Myers) ix. Auxiliary service: HR departments exist to assist and advise the line or operating managers to do their personnel work more effectively. HR manager is a specialist advisor. It is a staff function. x. Inter-disciplinary function: HRM is a multi-disciplinary activity, utilising knowledge and inputs drawn from psychology, sociology, anthropology, economics, etc. To unravel the mystery surrounding the human brain, managers need to understand and appreciate the contributions of all such ‘soft’ disciplines. xi. Continuous function: According to Terry, HRM is not a one-shot deal. It cannot be practised only one hour each day or one day a week. It requires constant alertness and awareness of human relations and their importance in every day operations. Objectives of HRM The main objective of HRM is to ensure that there are the right people for right jobs so that the organizational goals are achieved effectively. Beside that: - 5 Human Resource Management MSU-CBM (2024) 2 Credits ((SEC- Skill Enhancement Course) Objectives of HRM: 1. Social Objective: To be ethically and socially responsive to the needs of society: HRM must ensure that organisations manage human resource in an ethical and socially responsible manner through ensuring compliance with legal and ethical standards. 2. Organisational Objectives: To help the organisation reach its goals: HR department, like other departments in an organisation, exists to achieve the goals of the organisation first and if it does not meet this purpose, HR department (or for that matter any other unit) will wither and die. To provide the organisation with well-trained and well-motivated employees: HRM requires that to get the best out of the people, employees must be motivated to provide their maximum efforts, that their performance should be evaluated properly for results and that they will be remunerated based on their contributions to the organisation through appropriate HR policies, Practices and Programmes. 3. Functional Objectives: To employ the skills and abilities of the workforce efficiently: The primary purpose of HRM is to make people’s strengths productive and to benefit customers, shareholders and employees. To communicate HR policies to all employees: It is the responsibility of HRM to communicate in the fullest possible sense; tapping ideas, opinions and feelings of customers, non-customers, regulators and other external public as well as understanding the views of internal human resources. 4. Personal Objectives: To develop and maintain a quality of work life: It makes employment in the organisation a desirable, personal and social situation. Without improvement in the quality of work life, it is difficult to improve organisational performance. To increase the employees’ job satisfaction at maximum level and self- actualisation: It tries to prompt and stimulate every employee to realise their potential. It also tries to develop suitable programmes which need to be designed aiming at improving the quality of work life (QWL). 6 Human Resource Management MSU-CBM (2024) 2 Credits ((SEC- Skill Enhancement Course) Scope of HRM: The scope of HRM is very wide. Research in behavioural sciences, new trends in managing knowledge workers and advances in the field of training have expanded the scope of HR function in recent years. The Indian Institute of Personnel Management has specified the scope of HRM thus: Personnel aspect: This is concerned with manpower planning, recruitment, selection, placement, transfer, promotion, training and development, lay off and retrenchment, remuneration, incentives, productivity, etc. Welfare aspect: It deals with working conditions and amenities such as canteens, creches, rest and lunchrooms, housing, transport, medical assistance, education, health and safety, recreation facilities, etc. Industrial relations aspect: This covers union-management relations, joint consultation, collective bargaining, grievance and disciplinary procedures, settlement of disputes, etc. Scope of Human Resource Management Personnel Aspect Human Resource Planning – It is the process by which the organisation identifies the number of jobs vacant. Job Analysis and Job Design – Job analysis is the systematic process for gathering, documenting, and analyzing data about the work required for a job. Job analysis is the procedure for identifying those duties or behaviour that defines a job. Organising tasks, and responsibilities towards having a productive unit of work is called job design. The main purpose of job design is to integrate the needs of employers to suit the requirements of an organisation. Recruitment and Selection – Recruitment is the process of preparing advertisements based on information collected from job analysis and publishing it in newspaper. 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. 7 Human Resource Management MSU-CBM (2024) 2 Credits ((SEC- Skill Enhancement Course) 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 based on employee performance appraisal. Compensation Planning and Remuneration – It is the job of Human Resource Management to plan compensation and remunerate. Motivation – HR Department tries to keep employees motivated so that employees put their maximum efforts in work. Welfare Aspect – HR Department must 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. Industrial Relation Aspect – IR officers 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. HRM starts from the employees entry till the exit of the same and hence covers everything under the system. Activities: ❖ HR Planning- TATA ❖ Job Analysis – Job Description & Job Specification- Eg Wipro – implicit JA & Nirma – explicit ❖ Job Design eg- Bajaj Auto- Job Rotation and Job Enrichment ❖ Employees Hiring --Recruitment & Selection, Orientation & Placement, Training & Development: eg Dupont, Saint Goblin, ❖ Ceat Tyres– Self managed teamwork ❖ Employee and Executive Remuneration Eg-infosys prefers low base of salary & individual negotiation, L&T prefers collective bargaining ❖ Employee Maintenance – Motivation, Communication eg TATA, Reliance ❖ Performance Appraisal and Job Evaluation Eg- Opal, GACL & Bajaj Auto ❖ Industrial Relations – Welfare, Safety& Health eg ONGC, Apollo Tyres 8  Human Resource Management MSU-CBM (2024) 2 Credits ((SEC- Skill Enhancement Course) IMPORTANCE OF HRM The importance of human resource management: 1. AT THE ENTERPRISE LEVEL: Attracting and retaining: Good HR practices help in attracting and retaining the best people in the organization. Training people for challenging roles: It helps in training people for challenging roles, developing right attitude towards the job and the company, Providing maximum opportunity for personal development, promoting team spirit, Providing healthy relationship between different work groups so that work is effectively performed etc. Developing loyalty and commitment through appropriate reward schemes. Increase productivity and profits: Improving the employee’s working skill and capacity 2. At the Individual level: It promotes teamwork and team spirit among employees. It offers excellent growth opportunities to people who have the potential to rise. Generating right attitude among the employees through effective motivation. It allows people to work with diligence and commitment: Utilizing effectively the available goals of the enterprise and fulfilling their own social and other psychological needs of recognition, love, affection, belongingness, esteem and self- actualization. To develop skills and maintain job satisfaction at individual level. 3. At the Society level: Proper management of employees/people helps in enhancing their dignity by satisfying their social needs. This is done by: Employment opportunities multiply: HRM helps in providing healthy work environment, which might bring them psychological satisfaction. HRM maintains a balance between the jobs available and the jobseekers, according to the qualifications and needs. Enhance standard of living: HRM makes the maximum utilization of the resources in an effective manner and paying the employee a reasonable compensation in proportion to the contribution made by him. Scarce talents are put to best use. 9 Human Resource Management MSU-CBM (2024) 2 Credits ((SEC- Skill Enhancement Course) 4. At the National Level: A nation might be rich in physical resources will not get its benefit itself, unless human resource makes proper use of them. In fact, human resources with right attitude are solely responsible for making use of national resources and for the transformation of traditional economies into the modern industrial and knowledge economies. Man vis-à-vis Machine: Most of the problems in organisation are human and social rather than physical, technical or economic. No industry can be considered efficient, as long as the basic fact remains unrecognized that it is principally human. It is not a mass of machines and technical processes, but effective use of human resources helps in optimum utilization of natural, physical and financial resources. People with the right skills and proper attitudes help the nation to get ahead. Compete with the best in the world leading to a better standard of living and better employment. Industrial development: It is Dynamic and growth- oriented organizations requires an effective management of people in a fast changing environment. Organizations flourish only through the efforts and competence of their human resources. Employee capabilities must continuously be acquired, sharpened, and used. Any organization will have proper human resource management ▪ To improve the capabilities of an individual ▪ To develop team spirit of an individual and the department ▪ To obtain necessary co - operation from the employees ▪ To promote organizational effectiveness this in turn will help in overall development of the society as a whole and thereby causing overall growth and development of the nation. Questions: Q1. Define HRM? Q2. Discuss the nature and objectives of HRM? Q3. Explain Scope of HRM? 10 Human Resource Management MSU-CBM (2024) 2 Credits ((SEC- Skill Enhancement Course) ROLE OF HRM: Human Resources Management plays the most crucial role in the management of an organisation. The role of HRM is to plan, develop and administer policies and programs designed to make optimum utilization of the organization’s human resources. It is that part of management which is concerned with the people at work and their relationship within enterprises. According to R.L Mathis and J. H. Jackson (2010) several roles can be fulfilled by HR management. The nature and extent of these roles depend on both what upper management wants HR management to do and what competencies the HR staff have demonstrated. Three roles are typically identified for HR. Administrative Operational Actions Strategic HR Classification of HR Roles Administrative Actions: Personnel practices, Legal compliance, forms and paperwork Operational Actions: Managing employee relationship issues, Employee advocate Strategic HR Actions: Organizational business strategies HR strategic or planning Evaluation of HR Effectiveness Fig 1.4 Role of HRM (Source: Mathis R. L. & Jackson J. H. {2010}: Human Resource Management Thompson/South Western.) According to Dave Ulrich HR play’s four key roles. ▪ Strategic Partner Role-turning strategy into results by building organizations that create value; ▪ Change Agent Role- making change happen, and help it happen fast ▪ Employees Champion Role—managing the talent or the intellectual capital within a firm ▪ Administrative Role—trying to get things to happen better, faster and cheaper. 11 Human Resource Management MSU-CBM (2024) 2 Credits ((SEC- Skill Enhancement Course) 1. Administrative roles: Policy maker Administrative expert Advisor Housekeeper Counsellor Welfare officer Legal consultant 2. Operational roles ▪ Recruiter ▪ Trainer, developer, motivator ▪ Coordinator/linking pin ▪ Mediator ▪ Employee Champion ▪ Placing people on the right job ▪ Charting a suitable career path ▪ Rewarding good performance ▪ Resolving differences ▪ Adopting family-friendly policies ▪ Ensuring fair and equitable treatment ▪ Striking balance between employee expectations and Organisational requirements ▪ Representing workers' problems and concerns to management 3. Strategic roles ▪ Change agent ▪ Strategic partner 12 Human Resource Management MSU-CBM (2024) 2 Credits ((SEC- Skill Enhancement Course) ROLE OF HR MANAGERS Human Resource Managers, nowadays, wear many hats. They perform mainly three different types of roles, while meeting the requirement of employees and customers, namely administrative, operational and strategic. Administrative Roles: The administrative roles of human resource management include policy formulation and implementation, housekeeping, records maintenance, welfare administration, legal compliance etc. Policy maker: The human resource manager helps management in the formation of policies governing talent acquisition and retention, wage and salary administration, welfare activities, personnel records, working conditions etc. He also helps in interpreting personnel policies in an appropriate manner. Administrative expert: The administrative role of an HR manager is heavily oriented to processing and record keeping. Maintaining employee files, and HR- related databases, processing employee benefit claims, answering queries regarding leave, transport and medical facilities, submitting required reports to regulatory agencies are examples of the administrative nature of HR management. These activities must be performed efficiently and effectively to meet changing requirements of employees, customers and the government. Advisor: It is said that personnel management is not a line responsibility but a staff function. The personnel manager performs his functions by advising, suggesting, counselling and helping the line managers in discharging their responsibilities relating to grievance redressal, conflict resolution, employee selection and training. Personnel advice includes preparation of reports, communication of guidelines for the interpretation and implementation of policies, providing information regarding labour laws etc. Housekeeper: The administrative roles of a personnel manager in managing the show include recruiting, pre-employment testing, reference checking, employee surveys, time keeping, wage and salary administration, benefits and pension administration, wellness programmes, maintenance of records etc. Counsellor: The personnel manager discusses various problems of the employees relating to work, career, their supervisors, colleagues, health, family, financial, social, etc. and advises them on minimising and overcoming problems, if any. 13 Human Resource Management MSU-CBM (2024) 2 Credits ((SEC- Skill Enhancement Course) Welfare officer: Personnel manager is expected to be the Welfare Officer of the company. As a Welfare officer he provides and maintains (on behalf of the company) canteens, hospitals, creches, educational institutes, clubs, libraries, conveyance facilities, co-operative credit societies and consumer stores. Under the Factories Act, Welfare officers are expected to take care of safety, health and welfare of employees. The HR managers are often asked to oversee if everything is in line with the company legislation and stipulation. Legal consultant: Personnel manager plays a role of grievance handling, settling of disputes, handling disciplinary cases, doing collective bargaining, enabling the process of joint consultation, interpretation and implementation of various labour laws, contacting lawyers regarding court cases, filing suits in labour courts, industrial tribunals, civil courts and the like. In some organisations, the above administrative functions are being outsourced to external providers in recent times, with a view to increasing efficiency as also cutting operational costs. Technology is being put to good use to automate many of the administrative tasks. Operational Roles These roles are tactical in nature and include recruiting, training and developing employees, coordinating HR activities with the actions of managers and supervisors throughout the organisation and resolving differences between employees. i. Recruiter: “Winning the war for talent” has become an important job of HR managers in recent times in view of the growing competition for people possessing requisite knowledge, skills and experience. HR managers have to use their experience to good effect while laying down lucrative career paths to new recruits without, increasing the financial burden to the company. ii. Trainer developer, motivator: Apart from talent acquisition, talent retention is also important. To this end, HR managers have to find skill deficiencies from time to time, offer meaningful training opportunities, and bring out the latent potential of people through intrinsic and extrinsic rewards which are valued by employees. 14 Human Resource Management MSU-CBM (2024) 2 Credits ((SEC- Skill Enhancement Course) iii. Coordinator/linking pin: The HR manager is often deputed to act as a linking pin between various divisions/departments of an organisation. The whole exercise is meant to develop rapport with divisional heads, using PR and communication skills of HR executives to the maximum possible extent. iv. Mediator: The personnel manager acts as a mediator in case of friction between two employees, groups of employees, superiors and subordinates and employees and management with the sole objective of maintaining industrial harmony. v. Employee champion: HR managers have traditionally been viewed as ‘company morale officers’ or employee advocates. Liberalisation, privatisation and globalisation pressures have changed the situation dramatically HR professionals have had to move closer to the hearts of employees in their own self interest. To deliver results they are now seriously preoccupied with: Placing people on the right job. Charting a suitable career path for each employee. Rewarding creditable performance. Resolving differences between employees and groups smoothly. Adopting family-friendly policies. Ensuring fair and equitable treatment to all people regardless of their background. Striking a happy balance between the employee's personal/professional as also the larger organisational needs. Representing workers’ issues, problems and concerns to the management to deliver effective results HR managers have to treat their employees as valuable assets. Such an approach helps to ensure that HR practices and principles are in sync with the organisation’s overall strategy. It forces the organisation to invest in its best employees and ensure that performance standards are not compromised. Strategic Roles An organisation’s success increasingly depends on the knowledge, skills and abilities of its employees, particularly as they help establish a set of core competencies (activities that the firm performs especially well when compared to its competitors and through which the firm adds value to its goods and services over a long period of time, e.g. ONGC 's oil exploration capabilities and Dell's ability to deliver low cost, high-quality computers at an amazing speed) 15 Human Resource Management MSU-CBM (2024) 2 Credits ((SEC- Skill Enhancement Course) that distinguish an organisation from its competitors. When employees’ talents are valuable, rare, difficult to imitate and organised, a firm can achieve sustained competitive advantage through its people. The strategic role of HR management focuses attention on how to enable ordinary employees to turn out extraordinary performance, taking care of their ever-changing expectations. The key areas of attention in this era of global competition include effective management of key resources (employees, technology, work processes), while delivering cost effective, value- enhancing solutions. i. Change agent: Strategic HR as it is popularly called now aims at building the organisation’s capacity to embrace and capitalise on change. It makes sure that change initiatives that are focused on creating high-performing teams, reducing cycle time for innovation, or implementing new technology are defined, developed and delivered in a timely manner. The HR manager in his new avtar would help employees translate the vision statements into a meaningful format (Ulrich, 1998). HR's role as a change agent is to replace resistance with resolve, planning with results and fear of change with excitement about its possibilities. HR helps an organisation identify the key success factors for change and assess the organisation’s strengths and weaknesses regarding each factor. It may not decide what changes the organisation is going to embrace, but it would certainly lead the process to make them explicit. In helping to bring about a new HR environment there needs to be clarity on issues like who is responsible for bringing about change? Why do it? What will it look when we are done? Who else needs to be involved? How will it be measured? How will it be institutionalized? How will it be measured? How will it get initiated, developed and sustained? 16 Human Resource Management MSU-CBM (2024) 2 Credits ((SEC- Skill Enhancement Course) ii. Strategic partner: HR’s role is not just to adapt its activities to the firm’s business strategy, nor certainly to carry out fire-fighting operations like compensating employees. Instead, it must deliver strategic services cost effectively by building a competent, consumer-oriented work force. It must assume important roles in strategy formulation as well strategy implementation. To this end, it must identify external opportunities from time to time, develop HR based competitive advantages and move in to close the gaps advantageously (like excellent training centre, design centre, automation centre etc. which could be used by others as well). While implementing strategies, HR should develop appropriate ways to restructure work processes smoothly. Questions: ▪ What are the administrative roles of an HR Manager? ▪ What are the different operational roles of a manager? ▪ Who is an employee champion? ▪ What are the strategic roles of an HR Manager? ▪ Discuss the roles of HR Manger in the organisation? ▪ Explain in detail administrative role and strategic roles of HR Manager. 17  Human Resource Management MSU-CBM (2024) 2 Credits ((SEC- Skill Enhancement Course) Human Resource Planning: Human Resource Planning suggest of putting right number of people, right kind of people at the right place, at right time, and doing the right things for which they are selected and suited for the achievement of goals of the organization. Human Resource Planning has got an important place in the arena of industrialization. As according to Geisler, ―Manpower planning or HR Planning is the process which includes forecasting, developing and controlling by which an organization ensures that it has- ▪ The right number of people, ▪ The right kind of people, ▪ At the right places, ▪ At the right time, doing work for which they are economically most useful. According to Vetter, “HRP is the process by which management determines how the organization should move from its current manpower position to desired manpower position. Through planning, management strives to have the right time, doing things which result in both the organization and individual receiving maximum long run benefits”. According to Gordon Mc Beath, “HRP is concerned with two things: Planning of manpower requirements and Planning of Manpower supplies”. According to Beach, “HRP is a process of determining and assuming that the organization will have an adequate number of qualified persons, available at proper times, performing jobs which meet the needs of the enterprise and which provides satisfaction for the individuals involved” 18  Human Resource Management MSU-CBM (2024) 2 Credits ((SEC- Skill Enhancement Course) Features of HRP: Forward looking. -Human Resource. Planning (HRP) is a forward-looking function. It tries to assess human resource requirements in advance keeping the production schedules, market fluctuations, demand forecasts, etc.-, in the background. In sync with organizational needs: The human resource plan is subject to revision, of course, and is tuned to the requirements of an organisation from time to time. In tune with corporate plan: It is an integral part of the overall corporate plan and reflects the broad thinking of management about manpower needs within the organisation. Proactive: Internal as well as external changes impacting the organisation are assessed proactively from time to time so that HR plans would fit in with strategic business objectives Get qualified people at a right time: The focus of the plan is always on getting right number of qualified people into the organisation at the right time. Objective of human resource planning 19  Human Resource Management MSU-CBM (2024) 2 Credits ((SEC- Skill Enhancement Course) Objective of Human Resource Planning: Each organisation needs manpower planning. An organisational unit is started to accomplish certain goals. Which requires human resources with necessary qualification? These are provided through effective manpower planning. Comprehensive manpower planning helps to optimize effectiveness of human resources. Thus, the main objective of manpower planning is to ensure optimum use of human resources. Beside that the other objectives are: HR planning is required to meet the following objectives: Forecast personnel requirements: HR planning is essential to determine the future manpower needs in an organisation. In the absence of such a plan, it would be difficult to have the services of right kind of people at the right time. Cope with changes: HR planning is required to cope with changes in market conditions, technology, products and government regulations in an effective way. These changes may often require the services of people with the requisite technical knowledge and training. In the absence of an HR plan, we may not be able to enlist their services in time. Use existing manpower productively: By keeping an inventory of existing personnel in an enterprise by skill, level, training, educational qualifications, work experience, it will be possible to utilise the existing resources more usefully in relation to the job requirements. This also helps in decreasing wage and salary costs in the long run. Promote employees in a systematic manner: HR planning provides useful information based on which management decides on the promotion of eligible personnel in the organisation. In the absence of an HR plan, it may be difficult to ensure regular promotions to competent people on a justifiable basis. Thus, HR planning provides right size and structure of human resources which provides the basic infrastructure for smooth functioning of an organisation. It minimizes the cost of employment and nullifies the effects of disruptions in developing and utilizing the human resources. 20  Human Resource Management MSU-CBM (2024) 2 Credits ((SEC- Skill Enhancement Course) Importance of Human Resources Planning: Human Resource Planning is a highly important and useful activity. If used properly, it offers several benefits: i. Reservoir of talent: The organisation can have a reservoir of talent at any point of time. People with requisite skills are readily available to carry out the assigned tasks. ii. Prepare people for future: People can be trained, motivated and developed in advance and this helps in meeting future needs for high-quality employees quite easily. Likewise, human resource shortages can also be met comfortably (when people quit the organisation for various reasons) through proper human resource planning. iii. Expand or contract: If the organisation wants to expand its scale of operations, it can go ahead easily. Planning ensures a continuous supply of people with requisite skills who can handle challenging jobs easily. iv. Cut costs: Planning facilitates the preparation of an appropriate HR budget for each department or division. This, in turn, helps in controlling manpower costs by avoiding shortages/excesses in manpower supply. The physical facilities such as canteen, quarters, school, medical help, etc., can also be planned. v. Succession planning: Human Resource Planning, as pointed out previously, prepares people for future challenges. The ‘stars’ can be picked up and kept ready for further promotions whenever they arise. All multinational companies for example, have this policy of having a ‘hot list’ of promising candidates prepared in advance e.g., HLL, Proctor & Gamble, Godrej consumer products etc.3 Such candidates are rolled over various jobs and assessed and assisted continuously. When the time comes, such people ‘switch hats’ quickly and replace their respective bosses without any problem. 21 Human Resource Management MSU-CBM (2024) 2 Credits ((SEC- Skill Enhancement Course) The Process of Human Resource Planning Planning must be a systems approach and is carried out in a set procedure. The process of HRP usually followed in a large organisation, consists of the following steps: 1.Environmental Scanning: - Environmental scanning refers to the systematic monitoring of the external forces influencing the organisation. Managers monitor several forces, but the following are pertinent for HRP. i. Economic factors, including general & regional conditions. ii. Technological changes, including robotics & automation iii. Demographic changes, including age, composition & literacy. iv. Political & legislative v. Social concerns, including child care & educational facilities & priorities. 2.Organisational objectives & Policies:- HR plans need to be based on organisational objectives. In practice, this implies that objectives of the HR plans must be derived from organisational objectives. Specific requirements in terms of number & characteristics of employees should be derived from the organisational objectives. 22  Human Resource Management MSU-CBM (2024) 2 Credits ((SEC- Skill Enhancement Course) 2a. HR demand forecast: - it is the process of estimating the future quantity & quality of people required. The basis of the forecast must be the annual budget & long-term corporate plan translated into actively levels for each function & department. For eg: in the case of a manufacturing company, the sales budget will form the basis for production plan giving the number and type of products to be produced in each period. This will form the basis upon which the organization will decide the number of hours to be worked by each skilled category of workers. Once the number hours required is available organization can determine the quality and quantity of personnel required for the task. Demand forecasting is influenced by both internal factors and external factors: external factors include-competition, economic climate, laws and regulatory bodies, changes in technology and social factors whereas internal factors are budget constraints, production level, new products and services, organizational structure and employee separations. Demand forecasting is essential because it helps the organization to 1. Quantify the jobs, necessary for producing a given number of goods, 2. To determine the nature of staff mix required in the future, 3. To assess appropriate levels in different parts of organization to avoid unnecessary costs to the organization, 4. To prevent shortages of personnel where and when, they are needed by the organization. 5. To monitor compliances with legal requirements with regard to reservation of jobs. Techniques like managerial judgment, ratio- trend analysis, regression analysis, work study techniques, Delphi techniques are some of the major methods used by the organization for demand forecasting. Forecasting the Demand for Human Resources Most firms estimate how many employees they require in future. The demand for human talent at various levels is primarily due to the following factors: 1. External challenges: challenges arise from three important sources I. Economic developments: Liberalisation, opening of banking sector, capital market reforms, the online trading systems have created huge demand for finance professionals during 1990-1995 in India. The late 90s saw the rise of manufacturing, FMCG, Pharmaceuticals, Auto-components, Healthcare and Chemical Industries in a steady manner. Consequently, the demand for 23  Human Resource Management MSU-CBM (2024) 2 Credits ((SEC- Skill Enhancement Course) Engineering and Management graduates, Scientists and Healthcare professionals has picked up in recent times. II. Political, legal, social and technical changes: The demand for certain categories of employees and skills is also influenced by changes in political, legal and social structure in an economy. Likewise, firms employing latest technology in construction, power, automobiles, software, etc., have greatly enhanced the worth of technicians and engineers during the last couple of years. Technology, however, is a double-edged weapon and hence, its impact on HR plans is difficult to predict. For example, computerisation programme in Banks, Railways, Post and Telegraph Departments may reduce demand in one department (bookkeeping, for example) while increasing it in another (such as computer operations). High technology with all its attendant benefits may compel organisations to go lean and downsize workforce suddenly. Employment planning under such situations becomes complicated. III. Competition: Companies operating in fields where a large number of players are bent upon cutting each other’s throat (with a view to enhance their market shares) often reduce their workforce. Competition is beneficial to customers but suicidal for companies operating on thin margins. Such companies must necessarily go ‘lean’ by reducing their workforce. On the other hand, companies that are doing well and progressing smoothly will always look for people with critical skills. 2. Organisational decisions: The organisation’s strategic plan, sales and production forecasts and new ventures must all be taken into account in employment planning. If Britannia Industries Ltd expects higher demand for biscuits and bread, the long- term HR plan must take this into consideration. Likewise, if it tries to venture into other lucrative fields such as milk based products and confectionery items, the demand for people possessing requisite skills in those areas in the next couple of years should be looked into carefully. 3. Workforce factors: Demand is modified by retirements, terminations, resignations, deaths and leaves of absence. Past experience, however, makes the rate of occurrence of these actions by employees fairly predictable. 24 Human Resource Management MSU-CBM (2024) 2 Credits ((SEC- Skill Enhancement Course) 4. Forecasting techniques: The manpower forecasting techniques commonly employed by modern organisations are given below: 1. Judgmental/Expert forecasts: In this method, managers estimate future human resource requirements, using their experiences and judgements to good effect. Experts investigate quantitative data, use their judgment and experience while arriving at appropriate numbers. The different ways are as follows: a) The Simplest way- known as the Bottom-up forecasting method opinion and guidance form the unit, division/department to prepare an estimate. The sum of all such estimates prepared at various levels in different divisions is the demand forecast for the whole organization. b) Top- down forecasting: exercise commences with top managers. They meet to discuss trends, business plans, the economy and other factors that would impact on the organization. c) Delphi Technique is a forecasting aid based on the consensus of a panel of experts – who do not meet face to face but exchange notes through anonymous questionnaires. 2. Mathematical Techniques: Quantitative approaches to forecasting involve the use of statistical or mathematical techniques; they are the approaches used by theoreticians and professional planners. Trend analysis: HR needs can be estimated by examining past trends. Past rates of change can be projected into the future or employment growth can be estimated by its relationship with a particular index.(4.1) Box 4.1: Trend Analysis (An Example) 2001-02 Production of Units : 5,000 2002-03 No. of Workers : 100 Ratio : 100:5000 2003-04 Estimated Production : 8,000 100 No. of Workers required : 8000 × = 160 5000 If supervisors have a span of 20 workers, 8 supervisors are also needed in 2003-04. Computer models: Computerized forecasts could be prepared by including important variables such as direct labor hours needed to produce one unit of product and three possible sales outcomes— maximum, minimum and probable for the product in question. Other methods: Several mathematical models, with the aid of computers are also used to forecast HR needs, e.g., regression, optimisation models, budget and planning analysis. 25  Human Resource Management MSU-CBM (2024) 2 Credits ((SEC- Skill Enhancement Course) HRP Qualitative and Quantitative Aspects: To proceed systematically, human resource professionals generally follow three steps. Let’s examine these steps as applied in respect of, say a commercial bank. I. Workforce analysis: The average loss of manpower due to leave, retirement, death, transfer, discharge, etc., during the last 5 years may be considered. The rate of absenteeism and labour turnover should also be considered. The nature of competition says from foreign banks, other non- banking financial institutions may also be considered here to find out actual requirements in a year (Box. 5.2). Box 5.2: Manpower Flows in a Bank Promotions out Transfers In > > Job Hopping > Transfers Out > Retirement > VRS Scheme (Golden handshake) Recruits In > > Discharge or Dismissal > Terminations > Resignations Promotions In > > Retrenchment > Attractions in Other Banks, etc. While some of the interchanges and external supply could be predicted (growth opportunities, promotions, transfers, retirements, etc.) others are not so easy to predict. Past experience and historical data may help bank managers in this regard. II. Workload analysis: The need for manpower is also determined based on work- load analysis, wherein the company tries to calculate the number of persons required for various jobs with reference to a planned output – after giving weightage to factors such as absenteeism, idle time, etc. Box 5.3: Work Load Analysis (An Example) Planned output for the year 10,000 pieces Standard hours per piece 3 hours Planned hours required 30,000 hours Productive hours per person per year 1,000 hours (estimated on annual basis) (allowing for absenteeism, turnover, idle time etc.) No. of workers required 30 If span of control in the unit is 10 per officer, then 3 officers are also required. 26  Human Resource Management MSU-CBM (2024) 2 Credits ((SEC- Skill Enhancement Course) While determining manpower requirements through work load analysis, commercial banks may have to take the following factors into consideration: (i) the number of transactions to be handled by an employee; (ii) the amount of deposits and advances per employee; (iii) special requirements in respect of managing extension counters, currency chests, mobile branches, etc.; (iv) future expansion plans of the bank concerned. Managerial judgement – a study of the past trends – may serve as a useful guide in this regard. Statistical and econometric models may also be pressed into service, sometimes, depending on the requirement(s). III Job analysis: Job analysis helps in finding out the abilities or skills required to do the jobs efficiently. A detailed study of jobs is usually made to identify the qualifications and experience required for them. Job analysis includes two things: Job description and job specification. Job description is a factual statement of the duties and responsibilities of a specific job. It gives an indication of what is to be done, how it is to be done and why it is to be done. Job specification provides information on the human attributes in terms of education, skills, aptitudes and experience necessary to perform a job effectively. 2b. HR Supply Forecast: Supply forecast determines whether the HR department will be able to procure the required number of workers. Supply forecast measures the number of people likely to be available from within and outside an organization, after making allowance for absenteeism, internal movements and promotions, wastage and changes in hours, and other conditions of work. Supply forecast is required because it is needed as it 1. Helps to quantify the number of people and positions expected to be available in future to help the organization realize its plans and meet its objectives. 2. Helps to clarify the staff mixes that will arise in future 3. It assesses existing staffing in different parts of the organization. 4. It will enable the organization to prevent shortage of people where and when they are most needed. 5. It also helps to monitor future compliance with legal requirements of job reservations. Supply analysis covers the existing human resources, internal sources of supply and external sources of supply. 27  Human Resource Management MSU-CBM (2024) 2 Credits ((SEC- Skill Enhancement Course) Preparing Manpower Inventory (Supply Forecasting) The basic purpose of preparing manpower inventory is to find out the size and quality of personnel available within the organisation to man various positions. Every organisation will have two major sources of supply of manpower: internal and external. 1.Internal labour supply: A profile of employees in terms of age, sex, education, training, experience, job level, past performance and future potential should be kept ready for use whenever required. Requirements in terms of growth/diversification, internal movement of employees (transfer, promotions, retirement, etc.) must also be assessed in advance. The possibilities of absenteeism and turnover should be kept in mind while preparing the workforce analysis. Through replacement charts or succession plans, the organisation can even find out the approximate date(s) by which important positions may fall vacant. Frequent manpower audits may be carried out to find out the available talent in terms of skills, performance and potential. (see Figure 5.1) Figure 5.1: Estimated Internal Labour Supply for a given Firm 5.1. Staffing table: It shows the number of employees in each job. It tries to classify employees based on age, sex, position, category, experience, qualifications, skills, etc. A study of the table indicates whether current employees are properly utilised or not. 28  Human Resource Management MSU-CBM (2024) 2 Credits ((SEC- Skill Enhancement Course) 5.2. Markov Analysis: In hierarchical systems, routes for the employees, which is the promotion ladder, are well defined. It means every employee elevates himself in the organisation through a well-defined career path. All employees start in an organisation at the bottom rung and climb up the ladder one at a time. Any wastage is falling off the ladder. Young and Almond (1961), devised a hierarchical manpower system, framing sub-groups on the basis of salary grade and length of service. They have used the theory of the Markov process to measure the long-term equilibrium distribution of staff among the sub- groups. The basic assumption of this model is that an employee in a particular grade or a status group has a fixed chance of promotion in a given year, independent of vacancy. Thus, number receiving promotion depends on the number of eligible staff in the grade below, subject to fulfillment of eligibility criteria, which may be age, seniority, qualifications or experience. Figure 5.2: Estimated Internal Labour Supply for a given Firm i. Skills inventory: A skills inventory is an assessment of the knowledge, skills, abilities, experience and career aspirations of each of the current employees. This record should be updated at least every 2 years and should include changes such as new skills, additional qualifications, changed job duties etc. Of course, confidentiality is an important issue in setting up such an inventory. Once established, such a record helps an organisation to quickly match forthcoming job openings with employee backgrounds. 29  Human Resource Management MSU-CBM (2024) 2 Credits ((SEC- Skill Enhancement Course) Name : A.K. Sen Date printed : 1-4-2004 Number : 429 Department : 41 Key words Work experience Word Description Activity From To 2000 Tax clerk ABC Company Accounting Tax Supervision 1998 and analysis Book Keeping Ledger 2000 2002 Accountant XYZ Co. 2003 Supervision 2002 Auditing Computer Chief Accounts TT Bank Officer Analysis records Education Special Qualifications Memberships Degree Major Year Course Date 1. AIMA MBA Finance 1998 DBF 1996 2. ISTD B.Com Accounts 1995 Risk Management 1999 3. ICA Computer Languages Position Location Hobbies Literacy preference choice Tally French Accounting Kolkata Chess Banking Delhi Football Auditing Software Bangalore Boating Employees Signature HR Department Date Date Figure 5.3: An Example of a Skills Inventory iv Replacement chart: It shows the profile of job holders department-wise and offers a snapshot of who will replace whom if there is a job opening. (See Figure 5.4). Figure 5.4: An Executive Replacement Chart General Manager Key V. K. Garg Names given are replacement A/2 candidates P A to A. Promotable now General Manager B. Needing development L. Mathews C. Not suitable to position B/1 1. Superior performance Assistant General Manager 2. Above Average performance R.K. Arora A/2 3. Acceptable performance B.K. Nehru B/3 4. Poor performance Division: Division: Division: Accounting & Technical Advisor HR Manager Planning Manager Taxation Manager N.R. Murthy B/3 C.P. Thakur A/1 A.N. Gupta A/1 A.T. Roy C/2 K.P. Rao B/1 Northern Region Central Region Southern Region Eastern Region Manager Manager Manager Manager L.C. Srivatsav A/2 S.P. Kumar A/1 A. Subramanyam B/2 R. Krishna B/3 A. Thapar C/4 R. Pandey B/3 B.K. Menon B/1 30 Human Resource Management MSU-CBM (2024) 2 Credits ((SEC- Skill Enhancement Course) 1. External labour supply: When the organisation grows rapidly, diversifies into newer areas of operations (merchant banking, capital market operations, mutual funds, etc. in the case of a bank) or when it is not able to find the people internally to fill the vacancies, it has to look into outside sources. To the extent an organisation is able to anticipate its outside recruitment needs and looks into the possible sources of supply keeping the market trends in mind, its problem in finding the right personnel with appropriate skills at the required time would become easier. (see Box 5.4) Box 5.4: Important Barometers of Labour Supply 1. Net migration into and out of the area 2. Education levels of workforce 3. Demographic changes in population 4. Technological developments and shifts 5. Population Mobility 6. Demand for specific skills 7. National, regional unemployment rates 8. Actions of competing employers 9. Government policies, regulations, pressures 10. Economic Forecasts for the next few years 11. The attractiveness of an area 12. The attractiveness of an industry in a particular place Organisations, nowadays, do not generally track the qualifications of thousands of employees manually. Details of employees in terms of knowledge, skills, experience, abilities etc., are computerised, using various packaged software systems. [There are over 300 computerised human resource informations systems now available]. (A) Productivity plan: It will indicate reasons for employee productivity or reducing employee costs through work simplification studies, mechanization, productivity bargaining; incentives and profit-sharing schemes, job redesign, etc. (B)Retention Plan : It will indicate reasons for employee turnover and show strategies to avoid wastage through compensation policies; changes in work requirements and improvement in working conditions. 31 Human Resource Management MSU-CBM (2024) 2 Credits ((SEC- Skill Enhancement Course) Determining Manpower Gaps The existing number of personnel and their skills (from human resource inventory) are compared with the forecasted manpower needs (demand forecasting) to determine the quantitative and qualitative gaps in the workforce. 5. HR Programming: - Once an organization’s personnel & supply are forecasted the two must be reconciled or balanced in order that vacancies can be filled by the right employees at the right time. HR programming is the third step in the planning process, therefore assumes greater importance. 6. HR Plan Implementation: - Implementation requires converting an HR plan into action. A series of action programmes are initiated as a part of HR plan implementation. Some such programmes are recruitment, selection & placement, training & development, retaining & redeployment the retention plan the succession plan & redundancy plan. 7. Control & Evaluation: - This represents the final phase in the HRP process. The HR plan should include budgets, targets & standards. It should also clarify responsibilities for implementation & control and establish reporting procedures, which will enable achievements to be monitored against plan. KEY TERMS HRM: A process of aligning people and organisation so that the goals of each are achieved effectively and efficiently. HRP: Process of identifying human resource needs and formulating plans to meet these needs. Management: the process by which objectives of organizations are achieved by the organisation with and through people. Management Process: Planning, organizing followed by staffing, leading and controlling are five basic function of management. Performance review: A performance review is a written evaluation of an employee's success to show how well he or she has performed for a specific amount of time. 32 Human Resource Management MSU-CBM (2024) 2 Credits ((SEC- Skill Enhancement Course) Retention: It is the process of keeping skilled, successful employees at a specific company. Trend Analysis: Study of a firm‘s past employment needs over a period of years to predict future needs. Judgmental Methods: The services of experts are pressed into service in order to forecast the demand for labour. Experts look into quantitative data, use their judgment and experience while arriving at appropriate numbers. Computer Models: Computerized forecasts could be prepared by including important variables such as direct labour hours needed to produce one unit of product and three possible sales outcomes— maximum, minimum and probable for the product in question. Workforce analysis: The average loss of manpower due to leave, retirement, death, transfer, discharge, during the last 5 years may be taken into account. Work load, analysis: The need for manpower is also determined on the basis of work-load analysis, when the company tries to calculate the number of persons required for various jobs with reference to a plan output Job analysis: Job analysis helps in finding out the abilities or skills required to do the jobs efficiently. A detailed study of jobs is usually made to identify the qualifications and experience required for them. Job description: It is a factual statement of the duties and responsibilities of a specific job. It gives an indication of what is to be done, how it is to be done and why it is to be done. Job specification: It provides information on the human attributes in terms of education, skills, aptitudes and experience necessary to perform a job effectively. 33 Human Resource Management MSU-CBM (2024) 2 Credits ((SEC- Skill Enhancement Course) REFERENCES P. Subba Rao, Personnel &Human Resource Management, Himalaya Publishing, Fifth Revised Edition, 2014. Rao, Human Resource Management: Text and cases, First edition, Excel Books, New Delhi-2000. Gary Dessler, “Human Resource Management”, Seventh edition, Prentice-Hall of India P. Ltd., Pearson. K Aswathappa, Human Resource & Personnel Management, Fourth Edition, McGraw-Hill, New York, 2007. David A. DeCenzo & Stephen P. Robbins, Personnel/Human Resource Management, Third edition, PHI/Pearson. William B. Werther &Keith Davis, Human Resource & Personnel Management, Fourth Edition, McGraw-Hill, New York, 1993. www.businessmanagementideas.com/essays/evolution-of-human-resource- management-in-india/2471 hrdictionary.files.wordpress.com/2012/10/evolution-of-hrm3.jpg QUESTION: ▪ Trace the growth and development of HRM in India? ▪ Why HRM is important in today‘s scenario? ▪ Explain the process of HR planning? ▪ As an HR Manager what steps will you take to manage your employees in the organization? ▪ Discuss the challenges faced by HRM in India? ▪ Describe the role of HRM in the organisation? ▪ Why is HR planning more common in large organisation than small ones? What are the advantages of HRP for large organisations? 34 Human Resource Management MSU-CBM (2024) 2 Credits ((SEC- Skill Enhancement Course) UNIT: 02 RECRUITMENT, SELECTION & PLACEMENT Structure: Introduction Objectives Recruitment – Introduction ▪ Concept of Recruitment ▪ Sources of Recruitment ▪ Placement and Induction ▪ Training - Meaning & Concept ▪ Comparison between training and development ▪ Importance of Training ▪ Training Methods Key Terms References Questions 35 Human Resource Management MSU-CBM (2024) 2 Credits ((SEC- Skill Enhancement Course) INTRODUCTION : RECRUITMENT, SELECTION AND TRAINING & DEVELOPMENT. As already proved that the human resources are the most important assets for the organisation. The failure or success of any organisation is highly based on the competence of the manpower working in that organisation. Thus, to achieve the organisation objectives, the organisation especially HR needs to recruit manpower with requisite skills, qualifications and experience. While doing so HR needs to take into consideration both present and future requirements of the organisation in the mind. After the employees have been selected for various positions in the organisation, training them in the assigned task becomes the priority of the organisation to avoid future problems. Training acts as a breaking period where a new employee gets a chance to adjust to the new environment. Training involves enhancement of the knowledge, skills and abilities of the employee so that they can fit for meeting the requirements of the organisation. Whereas learning is an ongoing process where we learn the things which we were not aware of – basic to the conceptual skills making them fit for the organisation. Apart from training the technical skills the executives or managerial level employees are also required to learn the techniques of dealing with people, problem solving, decision making and other conceptual skills so developing the manager and executives becomes need of the organisation to prepare them for future. Every organization wants that their goals set by the organisation are achieved for that employees need to put their best efforts and help the organisation to achieve these predetermine goals, but every employee in the organization has a different attitude to do his job or handle the work, as some like work pressure while some avoids it. Thus, to evaluate or identify whether an employee is putting forward his best effort or not towards the job, (Unit 3) performance appraisal is used, to evaluate the performance of the employee. This helps the management to review the performance of each and every employee and finally take the decision, i.e. whether the employee should be given further training, or he is fit for promotion or still requires some more experience etc. 36 Human Resource Management MSU-CBM (2024) 2 Credits ((SEC- Skill Enhancement Course) RECRUITMENT – INTRODUCTION: Recruitment in simple terms can be defined as Finding and Attracting Applications. Definition: Recruitment is the process of identifying and analyzing the job requirements, and then finding the prospective candidates, who are then encouraged and stimulated to apply for the job in the organization. According to Edwin B. Flippo ―It is the process of searching for prospective employees and stimulating and encouraging them to apply for jobs in an organisation. Recruitment is the process of finding and attracting capable applicants for employment. Where the process begins when new recruits are sought and ends when their applications are submitted. This results in a pool of applications form that new employees are selected. The recruitment, as defined, is understood as the process of searching for and obtaining applicants for jobs, from among them the right person can be selected. Recruitment is one of the steps in the entire employment process. Recruitment precedes the selection function and includes only finding, developing the sources of prospective employees and attracting them to apply for jobs in organization. Selection is the process of finding out the most suitable candidate to the job out the candidates attracted (recruited). “A process to discover the sources of manpower to meet the requirements of the staffing schedule and to employ effective measures for attracting that manpower in adequate numbers to facilitate effective selection of an efficient work force”. “The process of searching for prospective employees and stimulating them to apply for jobs in the organizations.” Often Recruitment and Selection are interchangeably used and confused but there is a marked difference between the two words, as recruitment itself is a positive term because it only stimulates people to apply for the job to increase the hiring ratio i.e. a greater number of applicants apply for the job. While selection is a 37 Human Resource Management MSU-CBM (2024) 2 Credits ((SEC- Skill Enhancement Course) negative term because it involves elimination during its process rejecting several candidates, leaving only those who are appropriate to be hired. Recruitment acts as a linking Function– joining together those where jobs are to be fill and those who are seeking jobs. It acts as a joining process where it tries to bring together job seekers and the employer fulfilling the needs of both, former wanting the job and later wants their jobs or position to be filled i.e. requiring manpower. Recruitment Sources are distinct from Techniques ▪ Where are suitable candidates available in required number? – Sources of recruitment ▪ How can they be informed about the availability of jobs and about the organization? - Techniques of recruitment ▪ Sources are those where prospective employees are available like employment exchanges while techniques are those which stimulate the prospective employees to apply for jobs like advertising, promotion etc. Sources of Recruitment The sources of recruitment are broadly divided into two categories: internal sources and external sources. Both the methods have their own merits and demerits. They include shown in table 2.1: INTERNAL SOURCES EXTERNAL SOURCES Present Permanent Employees Campus recruitment Present Temporary/ Casual/Part Private employment agencies/ time employees Consultants Retrenched/Retired employees Public employment exchanges Dependants of present deceased/ Professional Associations disabled employees Data Banks Employee Referrals Casual Applicants Similar organizations Trade Unions Walk- in Consult-in and Outsourcing Head Hunting Body shopping Poaching/Raiding E- Recruitment Table 2.1 Sources of Recruitment 38 Human Resource Management MSU-CBM (2024) 2 Credits ((SEC- Skill Enhancement Course) INTERNAL SOURCES OF RECRUITMENT: Internal sources of recruitment refer to hiring manpower from within the organization ie internally. This means, applicants applying for the different positions are those who are already working within the same organization. This is an important source of recruitment, as it provides the opportunities for the development and utilization of the existing resources within the organization as performance of employees, selected is already known to the organisation. Let us discuss different methods of the internal sources. Present permanent employees: candidates from this source for higher level jobs due to: (a) Availability of most suitable candidates for jobs relatively or equally to the external source. (b) To meet the trade union demands (c) Organization policy of the organization to motivate the present employees. Present temporary/casual/ part time employees: source to fill the vacancies at the lower level Present Employees Promotions: Promotion involves upward movement, i.e. upgrading the employees by evaluating their performance in the organization. It involves shifting an employee from a lower position to a higher position with more responsibilities, salary, facilities, and status. Generally, many organizations fill their higher vacant positions with the process of promotions, internally. Transfers: Transfer involves lateral movement, i.e. the process of interchanging from one job to another without any change in the rank and responsibilities. It generally involves the shifting of employees from one department to another department or one location to another location, depending upon the requirement of the organisation. 39 Human Resource Management MSU-CBM (2024) 2 Credits ((SEC- Skill Enhancement Course) To understand how it works; Assume that there is a Software company called XYZ Ltd. Having two branches, Branch-A and Branch-B, but an employee from Branch- A leaves his job due to some reason. Now, this position must be filled thus, in this situation instead of searching and hiring a new candidate from outside which is time consuming and costly too, there is another possibility of shifting an employee from Branch-B to Branch-A, depending upon the requirements of the job and the capabilities of the employee. This internal shifting of an employee from one branch to another branch is called Transfer. Job Posting (Internal Advertisements): Job posting/ Internal Advertisements is a process of posting/advertising jobs only within the organization, for example in chain groups etc. This job posting act is an open invitation to all the employees working within /inside the organization, they can only apply for the vacant positions. It provides equal opportunities for all the employees working in the organization. Thus, the recruitment will be done from within the organization, and it is cost-saving too. Past Employees Recruiting Former Employees: Recruiting former employees is another method of internal sources of recruitment, in this the ex-employees who are either retired or have resigned from the organisation due to some reasons are called back for rejoining as per the requirement of the job and performance of the past employee. The benefit of this method is that it is cost effective, time saving and most important is that the employee is well equipped with the roles and responsibilities of the job, so the organization is not required to spend time and money on their T&D. Employee Referrals  Employee referrals: ✓ Candidates/applicants recommended by the current employees. ✓ Current employees recommend those candidates whose performance and behaviour are known to them as well as suitable to the job and organizational needs. ✓ This source helps to get high quality applicants and reduce the cost of recruitment drastically. 40 Human Resource Management MSU-CBM (2024) 2 Credits ((SEC- Skill Enhancement Course) Following measures to increase the effectiveness of employee referrals: ✓ Up the ante: provide benefits/incentives/commissions to current employees for recommending candidate ✓ Pay for performance: pay the benefit to the current employee for the higher performance of newly hired employee recommended by current employee ✓ Tailor the program: educate the current employees about the type of candidates including skills, knowledge, behaviour and ethical aspects the company is looking for Following will enable the current employees to recommend the suitable candidates: ✓ Increase visibility: celebrate the successful referral programs, which would publicise the program ✓ Keep the data: keep the CV of successful candidate on file which would be useful when a vacancy arises suddenly ✓ Rethink your taboos: some companies do not employ the former employees, relatives and friends of current employees. Companies should discontinue this policy ✓ Wider the program: companies can use former employees to recommend candidates ✓ Measure results: companies should calculate the success rate of employee referrals and inform the employees This concept is much popularized by BPO‘s or call center now followed in every field. Employee referral is an effective method of recruiting the right candidates at a low cost. In this method new candidates are hired through the references of employees who are currently working within the same organization. In this process, the present employees are encouraged to refer their friends and relatives to fill up the vacant positions. Most of the organizations, to motivate their employees, suggest referrals even provide with a referral bonus etc. for a successful hire. 41 Human Resource Management MSU-CBM (2024) 2 Credits ((SEC- Skill Enhancement Course) 1. Previous Applicants In this method the Hiring team plays the major role they as per the requirement of the organisation checks the profiles of previous applicants from the organizational recruitment database. These applicants are basically those who have applied for jobs earlier in the past but could not get selected due to one or other reason, their CV‘s are kept with HR department in the form of database These resources are than approached and if organisation gets a positive response they are selected for the jobs. It is also another inexpensive way of filling the vacant positions. Retrenched/Retired employees: ✓ organization takes the candidates for employment from the retrenched employees due to obligation, trade union pressure and like. ✓ Retired employees are reemployed as a token of their loyalty or to postpone some interpersonal conflicts for promotion, etc. Dependants of deceased, disabled, retired and present employees: with a view to develop the commitment and loyalty of not only the employee but also his family members and to build image. ADVANTAGES OF INTERNAL SOURCES: Why do organizations prefer internal source? (Advantages) Used as a technique of motivation Morale of employees can be improved Known devils are better than unknown angels Loyalty, commitment, sense of belongingness and security of the present employees can be enhanced Employees psychological needs can be met by providing an opportunity for advancement Employees economic needs for promotion, higher income can be satisfied Cost of selection can be minimized Trade unions can be satisfied Social responsibility towards employees may be discharged Suitability of employment can be ensured. DISADVANTAGES/ LIMITATIONS OF INTERNAL SOURCES: 42  Human Resource Management MSU-CBM (2024) 2 Credits ((SEC- Skill Enhancement Course) Excessive dependence on internal source results in in-breeding, discourages flow of new blood into the organization. Organization would become dull without innovations, new ideas, excellence and expertise. EXTERNAL SOURCES OF RECRUITMENT: External sources of recruitment refer to hiring employees from outside the organization externally. It suggests that, here the applicants seeking for the job are those who are external to the organization. Let us discuss different methods of the external sources:  Campus recruitment:  Different types of organizations can get inexperienced candidates of different types from various educational institutions like colleges and universities imparting education in science, commerce, arts, engineering & technology, agriculture, medicine, management studies etc.  Most of the universities and institutes impart technical education in various disciplines provide campus recruitment & selection.  Organizations seeking to recruit the candidates from this source can directly contact the institutes.  It helps in minimizing the time lapse and secure the cream before it is attracted by some other organizations.  Campus recruitment techniques: best source for recruiting cream of the new blood. It include:  Short listing the institutes and Selecting the recruiting team carefully  Offering smart pay rather than high pay package  Presenting clear image of the company, Present the company but do not over sell the company  Getting in early  Focusing on career growth opportunities, that the company offers to the recruits  Include the young line managers and alumni of Business school in the recruiting team  Build the relationship with the faculty, administrators and students to grab them before the rivals do. Employment Agencies/ Professional Associations/Consultants: Employment agencies / Professional Associations/Consultants are other good source of 43 Human Resource Management MSU-CBM (2024) 2 Credits ((SEC- Skill Enhancement Course) external recruitment. Employment agencies can be private, public, or government owned. They act as a link between the prospective candidates and employer. As they hold a database of qualified candidates and provide it to the organisation as and when required by them at some cost who then select from among it. They provides unskilled, semi-skilled and skilled resources as per the requirements of the organization.  Private employment agencies/consultants: Also called executive search agencies. Source for getting highly specialized and executive positions. They perform recruitment functions on behalf of a client company by charging fee. Line managers can concentrate on their operational activities as they are relieved from recruitment functions. Limitations- high cost, ineffectiveness in performance  Public employment agencies: Government set up exchanges to provide information about vacancies to the candidates and to help the organizations in finding out suitable candidates. Employment exchange Act 1959 makes it obligatory for public and private sector enterprises in India to fill certain types of vacancies through public employment exchanges.  Professional organization: They maintain complete bio-data of their members and provide the same to various organizations on requisition. Also act as an exchange between their members and recruiting firms in exchanging information, clarifying doubts etc. Suitable to recruit the experienced and professional employees like executives, managers, engineers.  Data banks: management can collect the bio-data of the candidates form different sources like employment exchange, educational training institutes, candidates etc and feed in the computer.  Employment Exchanges: Employment exchange is a government entity, where the details of the candidates requiring jobs are stored and are given to 44 Human Resource Management MSU-CBM (2024) 2 Credits ((SEC- Skill Enhancement Course) the employers for filling the vacant positions, As per the law, for certain job vacancies, it is mandatory that the organization provides details to the employment exchange. This external recruitment method is helpful in hiring employees at all levels.  Direct Recruitment: In this method a notice of vacancy is placed on the notice board of the organization and the suitable candidates can approach the concerned person, this method of sourcing is also called as factory gate recruitment, as the blue-collar and technical workers are hired through this process.  Casual applicants: Depending upon the image of the organization, its prompt response, level of unemployment, candidates apply casually for the jobs through mail or hand over the applications to HR department. Suitable for temporary and lower level jobs. Advertisements: Advertisements are the most popular and very much preferred source of external source of recruitment as they can reach to huge masses within same time and its proven fact that response through advertisement is most of the time positive. In this the job vacancy is announced through various print and electronic media – newspaper, radio etc with all the details like specific job description and specifications of the requirements. Going through the advertisement the prospective candidates can approach the organisation. Thus advertisements is the best way to source mass of candidates in a short span of time and it even offers an efficient way of screening the candidates‘ through specific requirements mentioned in the advertisement. Though Advertisement is one of the costliest method of recruitment, when time and number are important, then advertisement is the best source of recruitment. 45  Human Resource Management MSU-CBM (2024) 2 Credits ((SEC- Skill Enhancement Course) Word of Mouth Advertising: Word of mouth is purely an intangible way of sourcing the candidates for filling up the vacant positions. As there are many reputed organizations with such high and good image in the market. That these organisation names are more than enough for the job seekers. Such organizations only need a word-of-mouth advertising regarding a job vacancy to attract many candidates. Labour Contractors: Manual workers or Daily wage labours can be recruited through contractors who maintain close association with the sources of such workers. This source is used to recruit labour for construction jobs. Similar organizations: Experienced candidates are available in organizations producing similar products. Most effective source for executive positions and for newly established organization or diversified or expanded organizations. Trade unions: Unemployed or underemployed persons seeking change in employment put a word to trade union leaders due to their intimacy with management. Trade unions are aware of the availability of the candidates. To satisfy the trade union leaders, management enquires trade unions for suitable candidates. 46 Human Resource Management MSU-CBM (2024) 2 Credits ((SEC- Skill Enhancement Course) MODERN SOURCE AND TECHNIQUES OF RECRUITMENT Walk ins: This is the most common and least expensive method for candidates as in this the job seekers submit unsolicited applications or letters or resume or bio- data to the organization and directly come for the selection process as its similar to open for all‘ and even preferred by employers as they get a wider choice for selection for the post and moreover it is free from hassles associated with other methods of recruitment. Consult-in: busy and dynamic companies encourage the potential job seekers to approach them personally and consult them regarding the jobs. Companies select suitable candidates through selection process. Job Fairs: Job fairs are conducted by different companies to attract candidates for entry level jobs. In this all the organisation having vacancy collects at one place and organize a fair for the job seekers who can directly go to the desired counter of organisation and can apply for the respective post and company, it is another good method of external recruitment as through this company can get wider choices as well as good for job seeker as get all the big brands /non brands at one place so they can choose among it and beside that its less costly than advertisements. Outsourcing: Outsourcing method involves hiring the candidates from different organisation for the work and in return the organisation has to pay for their services. It is similar to contractual service as for example: In India, the HR processes are being outsourced from more than a decade now. Outsourced HR Firm help the organisation to create and screen the candidates for the organization for the final and further selection by the candidates for which HR firm will be paid for the services. Head hunting: companies request professional organizations to search for the best candidates particularly for the senior executive positions. Professional organizations search for most suitable candidates and advise the compan