Human Resource Management PDF

HUMAN RESOURCE MANAGEMENT CHAPTER 1 HUMAN RESOURCE MANAGEMENT– AN INTRODUCTION Learning Objectives After going through this unit, you will be able to: Define Human Resources – Key element D...

HUMAN RESOURCE MANAGEMENT CHAPTER 1 HUMAN RESOURCE MANAGEMENT– AN INTRODUCTION Learning Objectives After going through this unit, you will be able to: Define Human Resources – Key element Discuss Need & Scope of HRM Clarify Difference between HRM & Personnel Management Structure 1.1 Introduction 1.2 Nature Of HRM 1.3 Definition 1.4 Need For HRM 1.5 Scope Of HRM 1.6 Distinction Between Personnel Management and HRM 1.7 Distinction between Human Resource Management and Human Resource Development. 1.8 Summary 1.9 Keywords 1.1 Introduction It is now globally recognized that managing human resources is the basic job of Management. With the advent of globalization of business, HRM & HRD have now emerged as the most spectacular aspect of Management in India too. Neither general management nor any functional area would be able to successfully operate, if the management fails to manage the people who manage it. Hence, the crux of managing a business is the capability to manage people. The most important asset or resource of every organization is its human resource. Of late this fact has been recognized globally. Resultantly companies started viewing their people as their most important resource and hence humanization of work environment has become the need of the hour. The very management philosophy has, therefore, undergone a tremendous 01 | Page  HUMAN RESOURCE MANAGEMENT revival to the extent that every manager from top-to-bottom, in an organization is now concerned with the human resources management. Thus human resources management has achieved a pivotal position in management. 1.2 Nature Of HRM Human Resource Management (HRM) is concerned with the human beings in an organization. It reflects a new philosophy, a new outlook, approach and strategy which view an organization's manpower as its resources and assets and not as liabilities or mere hands. Resources are the means which can be drawn on. They are collective means for production, support and defense as well as a source of strength and aid. Human Resources are human wealth or means that can be drawn on. Human capital or manpower resources of a company can be treated as its human resources. It can otherwise be understood as the resourcefulness of the human beings or people available for an organization. 1.3 Definition Human Resource Management can be defined as that “part of management process which develops and manages the human elements of enterprises considering the resourcefulness of the organization's own people in terms of total knowledge, skills, creative ability, talents, aptitudes and potentialities for effective actuating.” 1. Human Resource Management is the process of managing the people of an organization with a humane approach. 2. Human Resource Management is a series of integrated decisions that form the employment relationship; their quality contributes to the ability of the organizations and the employees to achieve their objective. 3. Human Resource management is concerned with the people dimensions in management. Since every organization is made up of people, acquiring their services, developing their skills, motivating them to higher levels of performance and ensuring that they continue to maintain their commitment to the organization are essential to achieve organizational objectives. This is true regardless of the type of organization – government, business, education, health, recreation, or social action. 4. Human resource Management is the planning, organizing, directing and controlling of the procurement, development, compensation, integrating, maintaining, and separation of human resources to the end that individual, organizational and social objectives are accomplished. Thus, HRM refers to a set of programs, functions and activities designed and carried out in order to maximize both employees as well as organizational 02 | Page  HUMAN RESOURCE MANAGEMENT effectiveness. 1.4 Need For HRM The human resource management approach which has been gaining the attention of management professionals during the last decade has become the need of the hour due to various reasons. Widespread industrial unrest, growing trade union influence on workforce, trained worker management relationship, increasing gulf between management and their people, emergence of militancy in trade unionism, and the growing conflict in the industrial relations scene have resulted in the workers getting out of gear of the management in many organizations in India. This has made the management to think in terms of carrying their work with them. Convincing the workers of the management's concern for them may, perhaps, go a long way in getting along with them and ensuring their better performance. This has naturally resulted in the present human resources movement. Humanization of work environment in countries like Japan, quality of work life movement in countries like United States and the quality circles approach in India itself have initiated action to attain better organizational commitment among the work force. The human resource approach is in consistency with these movements. Changes in business environment have substantially affected the approach to manpower. Technological changes are prominent among them. Computer revolution, introduction of microprocessor CNC machines in manufacturing operations, mechanization and automation of office operations, quick communication systems like satellite and facsimile, introduction of Robots, electronic revolution, and such other developments have revolutionized the vital area of business. Operational efficiency of manpower must cope with such a revolutionary change in the technology which necessitated a new approach to manpower. Political philosophy has also undergone a substantial change not only in India, but elsewhere in the world, which necessitated a renewal in approach to human side of enterprise. Government of India under the leadership of Prime Minister Rajiv Gandhi gave a new emphasis for human resource development at the national level and a separate ministry was founded under a senior cabinet minister. Human resource development has, thus, received unprecedented emphasis in India, which opened up a door for a fresh approach to human resources development in the industrial sector too. Globalization of business is another important aspect of change which takes place in the business environment of today, necessitating a human resource approach to manpower. It is not only that Indian firm operates and competes 03 | Page  HUMAN RESOURCE MANAGEMENT abroad, but they have to compete with multinationals and foreign firms in India itself. Business philosophy, skills, expertise, efficiency and particularly global cooperate citizenship philosophy fostered by internationally successful firms necessitate Indian firms to deliberately update their perspective to suit the internationally emerging trends. In conformity with the human resource approach emerging globally, Indian managers must also foster a human resources philosophy to guide their management practices. A widespread feeling now influences at least some management practitioners that the technological development has gone to the extent of machines taking over the human jobs. For example: highly skilled milling, grinding and lathe machines are replaced by CNC machine tools which can take over, not only manual functions but even the intelligent human functions, and robots can take up human functions in place of real human beings. Increasing influence of illusions tend to reduce the importance of human role. In fact, no machine can replace man. The more the technological development, the greater would be the dependence on man. One single error a computer makes can lead to havoc, where skills and intelligence of man are indispensable. Greater the technological development, greater skill and technical capability are required of people who operate. Obviously greater human approach to people would be required. Large scale production, increasing effects of recession, technical and technological developments and so on have opened up new training needs for the people at work. Human resources development programs have, therefore, become the need of the hour. Government policy of importing technology has also necessitated introducing new facilities and avenues for training and development. Fresh initiatives and emphasis on research and development in the realm of industry also lead to a new policy of human resource development to cope with the increasing demand for technically capable people. Resultantly a need arose for a new approach to human resources. 1.5 Scope Of HRM Human Resources approach of management to its own people would go a long way in effectively actuating. It facilitates in identifying the right kind of people, socializing them in the most appropriate way, training and developing them in the right direction, assigning the tasks which are best suited for every individual so as to bring out their best, motivating them to make their best contribution and creating conditions for the people to enjoy their work. It establishes and maintains an organizational philosophy, culture and climate conducive for the organization's own people to have job satisfaction and a sense of fulfillment. As human resources development has a pivotal role in HRM, the organization gets the people it requires, while every individual gets the task which he can perform efficiently. 04 | Page  HUMAN RESOURCE MANAGEMENT HRM has great scope to improve organizational climate and efficiency which include: Ø A cordial worker management relationship would be possible. Ø Management would be able to understand their people better. Ø A situation would be created in the organization for the employees to enjoy their work and gain substantial job satisfaction. Ø Management would be able to get better cooperation from its workers. Ø Employees would be able to gain a great sense of accomplishment through their work. Ø Organizational efficiency and workers productivity would increase. Ø It would help the employees to gain a sense of belonging to their work place. Ø Better organizational climate and culture may emerge as a result of good human resource management. Ø As the people would be able to foster a sense of belonging, their sense of fulfillment and accomplishment would remain high. Ø As the people are respected as individuals, and their contribution are valued and rewarded, they would gain more self confidence and self respect and they will learn to respect other, particularly their superiors and managers. Ø The employees may be able to gain a self-confidence that their competence and performance can be improved and they would have prospects for better career growth and to use their competence and talents. Ø Management gets enlightened workforce. Ø A good communication channel would become possible as a result of mutual understanding and better coordination. Ø Influence level of management and managers would increase. Ø Adverse effect of trade unions, particularly self-seeking militant trade union leaders, can be reduced. Ø Gulf between management and workers can be reduced. Ø A good Human Resource Management policy would improve the possibility for industrial peace, which is badly needed in India now days. Ø It would become easier for the management to identify and train appropriate talents for every job. 05 | Page  HUMAN RESOURCE MANAGEMENT 1.6 Distinction Between Personnel Management And HRM Some thinkers and writers feel that personnel management lost its relevance with the emergence of human resource management. This is quite a mistake notion. On the contrary, personnel practices have attained a more crucial role as a result of the emergence of the human resources philosophy. In fact, personnel management has attained a multi-dimensional role; and the managers now make a multi-disciplinary approach to managing their people. Management is now concerned with working with people, for which a greater emphasis of the human element of enterprise is indispensable. Hence, a humanized personnel management is the crux of the human resource management. Human elements of enterprise are the most important resource, particularly because other resources cannot be effectively managed without appropriate human resources. Human resources consist of people, and personnel management is responsible for managing people. Hence, there cannot be any human resource management without personnel management in it. Human resource management, as a philosophy, has emerged recently while personnel management, as a function, has been existing for the last many decades. One may, therefore, regard that HRM is emerged out of personnel function and personnel management cannot be isolated from Human Resource Management, while there cannot be any management without human resource management. In respect of the relation between HRM and personnel management the following points may be relevant: I. Human resource management is primarily a philosophy, an attitude, an approach, a policy and a practice; while personnel management is a functional area and a function. II. Human resource management must remain at the centre of management itself, while personnel management is one of the functional areas in HRM. III. HRM represents the humanization of management, while personnel management is concerned with managing of manpower. IV. HRM is the concern of all managers from top to bottom in an organization, while personnel management is mainly concern of the personnel manager. V. HRM makes efforts primarily to satisfy the human needs of the people at work which motivates the people to make their best contribution for 06 | Page  HUMAN RESOURCE MANAGEMENT the achievement of organization goals and objectives, while personnel management maintain the rules, principles and legal provisions in managing the people. VI. HRM intervention is more concerned with working with people, team- building and team-work; while personnel management is interested in the orderly way of administration. VII. HRM concentrates more on motivation, morale-boosting and job satisfaction, while personnel management is primarily concerned with selection, recruitment and administration of manpower. VIII. Human resource development is at the centre of HRM, while managing people for maximizing output is the basic job of personnel management. IX. Human beings are considered as resources in HRM, while they are workmen to be managed in personnel management, and sometimes they are treated as liability. X. Training and development make an integral part of HRM, while organisation development presupposes manpower development in personnel management. XI. Human values and individual needs are given priority in HRM, while personnel management gives emphasis on effective administration. XII. All managers must be trained to adopt a human resource philosophy and to implement it in HRM intervention, while personnel function is the job of the personnel department in personnel management. XIII.Counseling, career planning, developing, correcting and redeeming make important aspects of HRM, while maintain records, enforcing rules, punishing the guilty, and keeping the administration intact are concern of personnel management. XIV.Significant part of every manager's time is set aside in HRM for those who directly report to him, whereas it is only the personnel manager's job to take care of the people in the organization. XV. Human resource management is an integrated approach accommodating all the aspects of developing, managing, satisfying and motivating human resources, whereas personnel management is primarily concerned with administration and management of people of an organization. XVI.Human resources managers act as catalysts, change agents, counselors, leaders and the spirits behind every activity, whereas personnel managers are concerned with administration of personnel 07 | Page  HUMAN RESOURCE MANAGEMENT matters only. XVII.Human resources managers are line executives who are, and must be, involved in policy and strategy formulation of the general management and all functional areas, particularly operations management, while personnel managers are concerned to be staff executives. XVIII.Human resources management philosophy must be primarily fostered by the top management which then remains the guiding principle of all levels of management, whereas personnel management is the exclusive job of personnel manager. XIX.Communication system (vertical, lateral, feedback and feed forth) is one of the most indispensable tasks of HRM, while personnel management is more concerned with preserving information and maintaining the secrecy of information. XX.HRM is concerned with determining the needs and aspirations of the people and formulating policy to fulfill them while matching the individual needs with the organizational objectives, whereas personnel management is concerned with procuring and managing people in accordance with the organizational needs. XXI.While personnel management is exclusive in itself, it is part and parcel of HRM which integrates personnel practices, industrial relations and employee welfare with it. Thus, HRM is not personnel management, while personnel management is in it. All the aspects of personnel function are integrated into human resources management along with HRD, counseling, redeeming, career planning, evaluation and compensating. 1.7 Distinction Between Human Resource Development And HRM As a result of the fundamental changes in attitudes, approaches, outlook, philosophy, perspective and practices emerged in the personnel area in the form of human resources management (HRM) strategy, it has become necessary for every organization to develop skills, talents, potentialities, capabilities and attitudes of company's own people to meet the emerging challenges. Hence, HRD (human resources development) policies have been adopted by many companies. It is now-a-days spreading to many others. HRD strategies are supposed to bring forth necessary changes in skills, capabilities and attitudes of people who are required to cope with the emerging changes. Thus, HRD has become an integral part of human resource management. HRD efforts are now described in terms of the training and educating programs and the number of people who are exposed to these programs. Unless a systematic and constant monitoring of these programs, in terms of actual 08 | Page  HUMAN RESOURCE MANAGEMENT results achieved, can be determined, it may not be possible to understand whether the real purpose is served by these programs. It needs constant efforts and continuous monitoring for a considerably long period. These efforts must go on simultaneously with the human resources management. HRM has its various tools like appraisal schemes, feed-back system, Quality Circle and Organization Development interventions, T-group training, MBO objective setting, consensus in decision-making, and so on. All such tools are useful in human resources development also. At present, however, training programs seem to dominate the HRD scene. An effective management information system backed by information collecting, storing and retrieval system and research and analysis must be the basis for every HRD program. This would enable the organization to motivate its own people to strive to be developed in accordance with the organizations needs (existing and expected). Thus, HRM is the integrated approach to actuating and managing the company's own people, while HRD deals with the process of developing people in accordance with their aspirations and to suit the organizational needs. Both are not synonyms; the latter is at the centre of the former, and both are independent and integrated into one system. In short HRM is essentially concerned with basic employee management. “It encompasses the traditional areas that most people think of as HR, including compensation and benefits, recruiting and staffing employee and labor relations and occupational health and safety”. Dave Ulrich, Professor of Business at the Ross School of Business, University of Michigan, defines four fields for HRM: 1. Strategic business partner 2. Change agent 3. Employee champion 4. Administration Human resource Development (HRD) on the other hand deals with the development of the resources in a company – organizational development, performance management, training and learning and coaching. 09 | Page  HUMAN RESOURCE MANAGEMENT Comparison between HRM and HRD BASIS FOR COMPARISON HRM HRD Meaning Human Resource Development means a Human Resource Development means a continuous development continuous development function that intends to function that intends to improve the improve the performance of people working in the performance of people working in the organization. organization. What is it? Management function. Subset of Human Resource Management. Function Reactive Proactive Objective To improve the performance of the employees. To develop the skills, knowledge and competency of employees. Process Routine Ongoing Dependency Independent It is a subsystem. Concerned with People only Development of the entire organization. 1.8 Summary Human Resource Management (HRM) is concerned with the human beings in an organization. The physical resources will not give results unless the human resources are applied to them. Management of human resources is being regarded as a specialized profession such as that of medicine and law. HRM has great scope to improve organizational climate and efficiency. A good Human Resource Management policy would improve the possibility for industrial peace, which is badly needed in India now days. A human relations program represents an attempt at improving employee morale and motivation. HRM is a broad concept which covers many personnel aspects and includes social, professional and individual enterprise aspects, whereas Personnel Management focuses only on personnel aspects such as leadership, justice determination, task specialization, staffing, performance appraisal, etc. HRM is more growth-oriented whereas Personnel Management is slightly narrow. 10 | Page  HUMAN RESOURCE MANAGEMENT 1.9 Keywords · Globalization:- The development of an increasingly integrated economy marked especially by free trade, free flow of capital. · Human resource (HR) department:- is a framework for the expansion of human capital within an organization through the development of both the organization and the individual to achieve performance improvement · Strategy:-Strategy is the pattern of decision in a company that determines and reveals its objectives , purpose or goals , produces the principal policies and plans for achieving those goals. · Management by Objectives(MBO):- is a process in which organizational members at all levels participate in management, goals are established and objectives are specified. 11 | Page