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UNIT I - PERSPECTIVES IN HUMAN RESOURCE MANAGEMENT

Evolution of human resource management – the importance of the human factor – objectives of human resource management – role of human resource manager – human resource policies – computer applications in human resource management.

Definition of HRM Prof. Jucius

The field of management which has to do with planning, organizing, directing and controlling various operative functions of procuring, developing maintaining and utilizing a labor force such that the

Objectives, for which the company is established are attained economically and effectively

Objectives of all levels of personnel are served to the highest possible degree Objectives of the community are duly considered and served

Edward Flippo Personnel management is the planning, organizing, directing and controlling of the

procurement, development, compensation, integration, maintenance and separation of human resources to the end that individual, organizational and social objectives are accomplished

Evolution of HRM Stage I : Pre-Industrial EraStage II : Industrial Revolution and the Factory systemStage III : Emergence of the Modern Corporation and Managerial CapitalismStage IV : Scientific Management, Welfare work and Industrial PsychologyStage V : World war I and the Emergence of HRM as a professionStage VI : The Human Relations MovementStage VII : The golden age of Industrial relations and the Personnel management Maintenance FunctionStage VIII : Quality of Work life EraStage IX : The emergence of contemporary HRM FunctionStage X : Strategic Focus EraStage XI : The HRM Functions today

Stage I : Pre-Industrial Era Around 1400 A.D. and continuing until the late 1700s First, a cessation (end) of feudalism (holding of land) Second, a shift from subsistence agriculture to a commercial mixed

economy Third, growth of town and villages along with a middle class that included

skilled craftsmen and merchants who were the forerunners of factory owners

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Stage II : Industrial Revolution and the Factory system In US – in the 19th century In India – Second half of the 20th century Replacement of human effort and skill by the work of machines Development of ‘factory system’

Gave birth to a rationalization (good reason) of work and a division of work

Necessity of supervising large number of workers Neglect of human factor – the focus was upon materials, markets

and production The factory owner delegated management responsibility to the

foreman or first-line supervisor. The foremen was responsible for successfully running the entire factory. The control of workers by the foreman usually took the form of the drive system of management that was characterized by the use of force and fear.

Stage III : Emergence of the Modern Corporation and Managerial Capitalism A fundamental transformation of employment from being primarily

agricultural to industrial, from small scale employing craftsmen to large scale. Employing semi-skilled operators.

The development of HRM during the 20th century included a primary industrial relations component which management would use to operate in the collective bargaining framework.

Stage IV : Scientific Management, Welfare work and Industrial PsychologyF.W. Taylor’s Scientific Management

It was F.W. Taylor who was the father of scientific management. Taylor was concerned with worker inefficiency and the need for managers to gain the co-

operative effort of the employees. He studied the elements of jobs, eliminating unnecessary motions and timing the tasks, in an effort to discover the “one best way” and the fastest time a worker could perform a particular task.

Time and Motion study became the heart of SM and represented jobs, eliminating unnecessary motions and timing the tasks, in an effort to discover the “one best way” and the fastest time worker could perform a particular task. Time and Motion study became the heart of SM and represented a way of accurately determining the amount of work a man could do.

Taylor declared that SM constituted a complete change in the mental attitude of workers and managers and he sums up SM as

(i) Science, not the rule of thumb(ii) Harmony not discord

(iii) Co-operation not individualism and(iv) Maximum output, in place of restricted output.

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Welfare workEfforts were made in the 19th and early 20th centuries to improve the working conditions of factory workers. The primary purposes of welfare work included (i) The averting (prevent)of industrial conflict and unionization.(ii) The promotion of good management and worker relations.(iii) The efforts to increase worker productivity and reduce turnover.Around 1900 A.D some industries in USA hired welfare secretaries to administer welfare programmes.

Industrial Psychology The objective or industrial psychology is to increase human efficiency by focusing on the maximum well-being of the worker and decreasing the physiological and physiological costs of work.

Stage V: World war I and the Emergence of HRM as a professionWorld War I provided conditions that resulted in the widespread recognition by business

of the need for HRM and the emergence of the field as a profession. The war brought attention to the need for ‘scientific personnel administration’ and centralizing, under a personnel director, activities promoting the welfare and efficiency of workers.The effect of the war on HRM was dramatic.

(i) First, during this time there was a widespread labor shortage. Labor turnover increased dramatically as a result of the increase in job opportunities for workers.

(ii) Second, the labour shortage accompanied by a rapid rise in wages and an increased demand

Stage VI: The Human Relations Movement The early focus of the HRM profession was the “human relations”. The human relations movement was associated with the name of Elton Mayo and

Fritz Roethlisberger. Human relations incorporated the human factor into SM. This human relations

effort reflected the symbiotic combination of SM, welfare work and elements of industrial psychology in the personnel profession.

The emphasis was on increasing productivity through discovering the needs of workers, the proper way of managing people and increasing productivity.

Stage VII: The golden age of Industrial relations and the Personnel management Maintenance Function

Following the depression there was an increased need for the practice of HRM as a result of a growth in unions and collective bargaining.

Although prior to the depression the primary attention of HRM was directed towards PM activities, at this time there was a shift in emphasis towards the IR functions of HRM.

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Golden age of IRThe IR side of HRM experienced its golden age between 1948 and 1958. The general

focus of HRM was on IR because the primary need of many organizations was to operate in the collective bargaining framework or labour relations.

Stage VIII: Quality of Work life Era Beginning around the mid 1960s and containing up through the decade of the 1970s,

there was a rise in the view of the importance of human resources as assets, not liabilities.Practices and Programmes Implemented The effort of this era were driven not only by a realization that investments in human resources were sound and should show a considerable return but also by the changing nature of the workforce.

Stage IX: the emergence of contemporary HRM Function Factors leading to transformation of HRM functions

i. Firstly, private sector unionism started to fall as a percentage of the labour force.ii. Secondly, since World war II, the shift from manufacturing employment to

service sector employment has continued.iii. Thirdly, there had been a dramatic expansion of Government regulation of the

terms and conditions of employment which business have to comply with.iv. Fourth, there was growth in the international competition, domestic competition,

globalization and technological change. The convergence of these factors had required the companies to adopt very different HRM policies.

Changes in HRM policies Decrease in union representation of their workers Dealing with employees indirectly and collectively To assist the organization’s compliance with Government regulations Application of TQM (Total Quality Management) Principles.

Changes in HRM Functions Emphasis on human resources as organizational assets.

HRM indicates a proactive approach

Stage X: Strategic Focus Era Strategic HRM has referred to a long term view of HR policy and a simultaneous

integration horizontally among the various HR functions and a vertical integration with corporate strategic planning.

Stage XI : The HRM Functions today HRM’s involvement in overall organizational planning and change As a creator of organizational culture and facilitator of organizational commitment Decentralization of many of the traditional HRM activities – from personnel specialist to

senior line management

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Focus on individual employees rather than on collective management-trade union relations.

Objectives of HRM

i. To ensure effective utilization of human resources. All other organizational resources will be efficiently utilized by the human resources.

ii. To establish and maintain an adequate organizational structure of relationships among all the members of an organization by dividing of organization tasks into functions, positions and jobs, and by defining clearly the responsibility, accountability, authority for each job and its relation with other jobs in the organization.

iii. To generate maximum development of human resources within the organization by offering opportunities for advancement to employees through training and education

iv. To ensure respect for human beings by providing various services and welfare facilities to the personnel.

v. To ensure reconciliation of individual/group goals with those of the organization in such a manner that the personnel feel a sense of commitment and loyalty towards it.

vi. vi. To identify and satisfy the needs of individuals by offering various monetary and non-monetary rewards.

vii. vii. To achieve and maintain high morale among employees in the organization by securing better human relations

Scope and activities of HRMTo achieve the objectives of an organization, HRm undertakes the following

activities.(i) HR or manpower planning (determining the number and kinds of personnel required to

fill various positions in the organization)(ii) Recruitment, selection and placement of personnel (employment function)

(iii) Training and development of employees for their efficient performance and growth(iv) Appraisal of performance of employees and taking corrective steps such as transfer from

one job to another(v) Motivation of workforce by providing financial incentives and avenues of promotion

(vi) Remuneration of employees(vii) (vii) Social security and welfare of employees

(viii) (viii) Review and audit of personnel policies, procedures and practices of the organization

Functions of HRMa) Managerial Functionsb) Operative Functions

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Managerial Functions i. Planning

- is a predetermined course of action- It is the determination of the plans, strategies, programmes, policies,

procedures, and standard needs to accomplish the desired organization objectives- “Planning today avoids crisis tomorrow”

ii. Organizing Organizing as a process involves:

Identification of activities. Classification of grouping of activities. Assignment of duties. Delegation of authority and creation of responsibility. Coordinating authority and responsibility relationships.

iii. Directing Directing is involved with getting persons together and asking them (either

to command or motivation) to work willingly and effectively for the achievement of designated goals

iv. Co-ordinating and controlling It is the act of checking, regulating and verifying whether everything

occurs in conformity with the plan that has been adopted, the instructions issued and the principles established

Operative Functions (also known as service functions)1. The procurement function

It is concerned with the obtaining of a proper kind and number of personnel necessary to accomplish an organization’s goals.

- determination of manpower requirements- recruitment, selection, induction, follow-up, transfer etc.,

2. The development functionIt is concerned with the personnel development of employees by

increasing their skill through training so that job performance is properly achieved.3. The compensation plan

It is concerned with securing adequate and equitable remuneration to personnel for their contribution to the attainment of organizational objectives

4. The integration functionIntegration is concerned with the attempt to effect a reasonable

reconciliation of individual, societal, and organization interests.5. The maintenance function

It deals with sustaining and improving the conditions that have been established. Specific problems of maintaining the physical conditions of employees (health and safety measures) and employee service programmes are the responsibility of the personnel department.

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HR Manager Human Resource (HR) or Personnel Department is established in many

organizations, under the charge of an executive known as Human resource / Personnel Manager.

Role of HR manager:

(a) Functions Of HR Manager

MANAGERIAL Functions1. Planning2. Organizing3. Directing4. Controlling

OPERATIVE Functions

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1. Employment2. Training and Development3. Remuneration4. Working conditions5. Motivation6. Personnel records7. Industrial Relations8. Separation

Advisory1. Advice to top management2. Advice to departmental heads

(b) Role of personnel or HR manager in an organization

i. Personnel Rolea. Advisoryb. Manpower planning (recruitment, selection)c. T&Dd. Measurement and assessment of individual and group behavior

ii. Welfare Rolea. Research in personnel & Organizational problemsb. Managing services – canteens, transportc. Group Dynamics – Group counseling, motivation, leadership. Etc.

iii. Administrative Rolea. Time – Keepingb. Salary & wage administrationc. Maintenance of recordsd. Human Engineering – Man-Machine relationship

iv. Fire-fighting Legal Rolea. Grievance handlingb. Settlement of disputesc. Handling disciplinary actionsd. Collective bargaininge. Joint Consultation

HUMAN RESOURCE POLICIES

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  Predetermined established guideline towards the attainted of accepted goals and

objectives. Guidelines facilitate properly designed efforts to accomplish the strategic intent.

 “A policy is a man-made rule of pre-determined course of action that is established to

guide the performance of work toward the organization objectives. It is a type of standing plan that serves to guide subordinates in the execution of their tasks”.

Characteristics of a Policy A statement should have the following characteristics in order to be accepted as a

policy.1. Policy is an expression of intentions of top management2. Policy is stated in broad terms3. Policy is long lasting4. Policy is developed with the active participation of all executives5. Policy is in writing6. Policy is linked with objectives

Types of Policies A business enterprise may have the following kinds of policies.

1. Functional PoliciesPolicies may be set up in the key areas of the enterprise like production, purchase,

finance, personnel and marketing. Such policies are known as functional policies.2. Internal Policies

- initiated by managers at various levels to guide subordinates- are closely related to the organizational objectives- They differ in their nature and scope depending upon the level of management

where they have been formulated.(a) Basic Policy – used by the top managers and it is applicable to the organization as a whole(b) General policy – affects middle level managers, it is more specific and is used mainly by middle level managers(c) Departmental policy – its specific and applicable to the lowest level of management to provide a guide in the day-to-day activities

3. External Policies (imposed policies)it includes those policies arising to meet the various pressures and requests of

forces outside the enterprise such as government, trade unions and trade associations.

4. Appealed Policies

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- formulated on the basis of the suggestions and complaints received from the employees.( if it is exceptional in nature and is not covered by the existing policies)

5. Stated or Explicit policiesSuch policies are usually in writing and form a part of the enterprise manual.

They are definite and generally rigid.

6. Unstated or Implied policies- are not recorded in writing even though they are followed at every level.- they are inferred from the behavior of the managers, and they are flexible in

nature.

Formulation of Personnel policies (steps)1. Preliminary Investigation

When the data collection stage is over, the policy committee should have a sound ground to proceed further in this matter. The committee should also be aware about the following factors

(a) Labour legislation Policy should be in conformity with the laws of the country

(b) Social values and customs These are the accepted codes of behaviour of any community which a

policy should take into account(c) Employees’ aspirations

Personnel policies reflect the intentions of the top management of the company as regards management of human resources. These intentions should aim at satisfying the hopes and aspirations of the people who work in the organization.

2. Environmental Scanning Internal environment – deals with physical resources, human resources,

organizational structure, workers-management relations, values and beliefs. Etc., External environment – relates to social, political, economic and technological

conditions in the country.

3. Identification of policy areas (two broad groups) The first group deals with policy formulation in various managerial functions,

namely, planning, organizing, staffing, directing and controlling. The second group involves policy formulation in functional areas of business,

namely, production, marketing, finance, personnel, etc.,

4. Analysis of alternative policies

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This stage in policy formulation deals with examination of alternative policies in the light of their contribution to the organizational goals.

That policy alternative should be selected which is likely to yield the best possible results for the organization.

5. Participation of lower levelsThe ultimate choice of the policy should be made with the active participation of those

who use and live with the result it gives.

6. Approval of top managementPolicy formulation committee should report to the top management its considered

opinion integrating the members’ judgement and findings

7. Implementation of policyFailure to implement a policy statement would create not only confusion but also

a lack of confidence in management’s pronounced commitments.

8. Policy appraisalThe representatives of management who are guided by organization’s policy and

other employees affected by a given policy can develop the experience needed to appraise its appropriateness and usefulness.

Computer applications in HRMComputer technology enables organizations to combine human resource

information into a single database. This database is referred to as a human resource information system (HRIS).

What is HRIS?An HRIS may be defined as the system used to acquire, store, manipulate,

analyze, retrieve, and distribute pertinent(relevant or important) information regarding an organization’s human resources.

Objectives of HRIS 1. To acquire, store, manipulate, analyze, retrieve, and distribute the information of human

resources.2. To facilitate HR decision-making in the following areas:

a. Man-power planningb. Recruitment and selectionc. Employment, including promotion, transfers, disciplinary procedures,

termination and redundancyd. Education and traininge. Salary and wages administrationf. Labour relations; etc

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3. To provide relevant information on employees to government agencies as part of the legal requirements

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Components of HRIS

HRIS consist of three components:1. Hardware2. Software3. Database

Acquiring and Implementing an HRISPhase 1: HRIS Needs Analysis or AssessmentPhase 2: HRIS Design and DevelopmentPhase 3: HRIS Implementation and maintenance

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Phase 1: HRIS Needs Analysis or Assessmenti. Evaluate HR department and business needsii. Form Project teamiii. Determine automation needsiv. Develop system specificationsv. Analyze current and future reporting needsvi. Identify and evaluate vendor packagesvii. Select vendorviii. Develop proposal for management/decision makersix. Establish formal guidelines and procedures to resolve insufficiencies

Phase 2 : HRIS Design and Developmenti. Develop detailed project plan

ii. Develop user groupsiii. Purchase hardwareiv. Develop independent, focused computer applicationsv. Implement independent applications as ready

vi. Modify in-house formsvii. Modify/customize initial system

viii. Establish procedures and guidelines to support systemix. Test system user acceptancex. Convert data

xi. Train HR staff and/or project team

Phase 3 : HRIS Implementation and maintenancei. Implement HR core

ii. Train other HR usersiii. Make system available to HR functional specialistsiv. Establish mainframe-micro linkv. Develop/refine user documentation

vi. Conduct field analysisvii. Develop procedures for distributed processing

viii. Prepare technical documentationix. Develop/work on other modulesx. Test system and user acceptance

xi. Implement additional modulesxii. Maintenance

xiii. Distribute to the fieldsxiv. Evaluate success/effectiveness

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Issues or problems in developing an HRIS i. Expensive in terms of finance and manpower requirement for smaller size organization

ii. Inconvenient for those who are not comfortable with computersiii. Invade of employee privacy by unauthorized personsiv. Danger of wrong HR decisions due to incomplete and inadequate databasev. Sometimes direct interpretation of HRIS’s output may be misleading and inappropriate.

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Computer applications in HRM

1. Computer applications in strategic HRM and HR planning2. Computer applications in Job Analysis3. Computer applications in Recruitment4. Computer applications in Selection5. Computer applications in HR development and career planning6. Computer applications in performance Appraisal7. Computer applications in Compensation and benefits8. Computer applications in health and safety9. Computer applications in Labour relations