Human Resource

Management
-Prof. Rutuja Jadhav
TOPIC 1
HRM is a management function that
helps managers recruit, select, train
& develop members of organization
Definitions of HRM
 George Terry
“ HR is concerned with the
obtaining & maintaining of a
satisfactory & a satisfied work force.”
 Breach

“ HR is that part of management

process which is primarily concerned
with the human constituents of an
organization.”
Characteristics/Nature of
HRM
 To manage people
 To direct people

 To develop personnel

 It is applicable to all org.

 It is of continuous nature

 It is based on principles

 It aims at optimum contribution by all

 Importance of HRM
 Social
1. Creation of employment opportunities
2. Maximizing productivity
3. Affording maximum material & mental
satisfaction to work force
4. Avoidance of wastage of efforts
5. Promotion of healthy human relation
 Personnel
1. Provision of adequate remuneration
2. Job security
3. Training & Development
4. Opportunity for advancement
 Enterprise
1. Recruitment & maintenance of competent
workforce
2. Forecasting & balancing the demand &
supply of personnel

 Union
1. Recognition of union
2. Formulation of personnel policies in
consultation with unions
3. Inculcating Self discipline
HRM is about…

 Legal issues
HRM is about…

 Planning staffing needs

 HRM is about…

 Recruiting,
selecting, and
hiring
 HRM is about…

 Organizing work
processes
 HRM is about…

 Training
HRM is about…

 Communicating
performance
feedback
 HRM is about…

 Careeror
employment
counseling
 Difference between
Personnel Mgt & HRM

 Indirect communication  Direct communication

 Division of Labour  Team work
 Labour is treated as a tool  People are treated as
which is expandable & asset to be used for
replaceable benefit of org
 Narrow Scope  Broader scope
 Strategic Management
 Strategy
“ It is a way of doing something”. It usually
includes formulation of a goal & set of action
plans for accomplishment of that goal.”
 Strategic Management

“ It is the process of formulating,

implementing & evaluating business
strategies to achieve organizational
objectives.”
 Strategy Formulation
Strategies are formulated at three different levels:
 Corporate Level-Top Management

 Business Unit Level- Single Strategy that drives

business at all level

 Functional Level-Basic courses of action each

functional department must pursue
TOPIC 2
 Human Resource Planning/
Man-Power Planning
 “HRP is the process of forecasting a firm’s
future demand for & supply of, the right
type of people in the right number.”

 HRP is also called as Manpower Planning,

Personnel Planning or Employment
Planning
 Objectives of HRP

 To estimate organization’s HR need

 To Assess Human Resource requirements

 To keep Right number of qualified people

into right job at the right time
 To Create Talented Personnel

 Cut Cost
Importance of HRP

 Future personnel needs

 Part of strategic planning

 Creating Highly Talented Personnel

 International Strategies

 Foundation for Personnel Functions

 Increasing Investments in HR

 Minimizing Labour Turnover

 HRP Process
Environmental Scanning

Organisational Objectives and

Policies

HR Demand Make Comparison HR Supply

forecast forecast
No differences
Demand
equals supply
Difference

Surplus Shortage
Restrict hiring, Recruitment and
Reduce hours, Selection, Hiring,
VRS, lay off etc Overtime
 Environmental Scanning- Systematic
screening of external forces influencing org.
like Economic factors, Technological changes,
demographic changes, Political & Legal
Issues.

 Organisational Objectives & Policies- HRP

must be based on Organisational Objectives &
Policies
 HR Demand forecast- Process of
estimating quantity & quality of people
required to meet future needs of org.

 HR Supply Forecast- Supply forecast

measures the number of people likely
to be available from within & outside an
org.
 Job Analysis
It is the process of collecting job related
information.

 The process of Job Analysis results in two

sets of data:
1. Job Description-outline of the role of the job holder

2. Job Specification- outline of the skills and qualities

required of the post holder
 Job Analysis
Job Analysis
Job Description
Job Description Job Specification
Job Specification
•• Job
Job Title
Title •• Education
Education
•• Location
Location •• Experience
Experience
•• Job
Job Summary
Summary •• Training
Training
•• Duties
Duties •• Judgement
Judgement
•• Machines,
Machines, Tools,
Tools, && Equipments
Equipments •• Initiative
Initiative
•• Materials
Materials && Forms
Forms used
used •• Physical
Physical efforts
efforts
•• Supervision
Supervision given
given or
or received
received •• Physical
Physical Skills
Skills
•• Working
Working Conditions
Conditions •• Responsibilities
Responsibilities
•• Hazards
Hazards •• Communication
Communication Skills
Skills
•• Emotional
Emotional Characteristics
Characteristics
Merits of Job Analysis

 Organisational & Manpower Planning

 Recruitment & Selection

 Wage & Salary Administration

 Employee Training & Development

 Performance Appraisal

 Health & Safety

Recruitment
Recruitment
 The process by which a job vacancy
is identified and potential employees
are notified.

 It is process of searching for

prospective employees & stimulating
& encouraging them to apply for jobs
in an organization
 Sources of Recruitment
Internal Sources External Sources
 Employment Exchanges
 Promotions  Advertisement
 Transfers  Colleges/Universities
 Absorption of Trainees  Recommendations of
 Internal Advertisement present employees
 Labour Unions
 Lent Services
 Field Trips
 Personnel Consultants
 Factory Gate
 Contractors
 From other Firms
Selection
 Selection

 The process of assessing candidates and

appointing a post holder

 It is the process of differentiating between

applicants in order to identify those with a
greater likelihood of success in a job
Selection Process
Scrutiny of Application Received

Preliminary Interview

Blank Application Forms

Tests

Final Interview

Checking References

Medical Examination

Final Selection
 Induction/Orientation

 Induction is a systematic & planned

introduction of employees to their
jobs, their co-workers & the org.
 Strategic Choices of
Induction

FORMAL INFORMAL

INDIVIDUAL COLLECTIVE
 Problems of Orientation

 Supervisor who is not trained or busy

 Employee is overwhelmed with too
much information in a short time
 Employee is overloaded with forms to
complete
 Employee is thrown into action too
soon
 PLACEMENT

 It refers to allocation of people to jobs.

 It involves assignment of new

employees, & promotion, transfer, or
demotion of present employees.
 Employee Retention
 Employee Retention is a systematic
effort by employers to create and
foster an environment that
encourages current employees to
remain employed.

 Employee retention refers to policies

and practices companies use to
prevent valuable employees from
leaving their jobs
 EMPLOYEE RETENTION
TOOLS
1. Communication
2. Include employees in decision making
3. Allow team members to share their
knowledge with others
4. Balance work and personal life
5. Provide opportunities for growth and
development
8. Best employee reward programs
9. Appreciation
10.Career development program
11. Performance based bonus
12. Employee recreation
13. Gifts on some occasions
TOPIC 3
 Training & Development

 Training
“ Training is the act of increasing
skill & knowledge of & attitude of an
employee for doing a particular job.”
 Development

“ Development refers to learning

opportunities designed to help
employees grow.
Need for Training

 Non-availability of trained personnel

 Suitable for enterprise needs

 Proficiency in latest methods

 Technological advances

 Organizational complexity

 Human Relations
 Advantages of Training
 To the Company  To the Candidate
1. Increased Proficiency 1. Confident Employees
2. Reduced Supervision 2. Positive Attitude
3. Reduced Accidents & 3. Chances of
wastages promotion
4. Lower Absenteeism 4. Refreshing
5. Assist newcomers 5. High Rewards
6. Competent & capable 6. Cooperation
employees
 Methods of Training
1. On the job Training
2. Vestibule Training
3. Internship Training
4. Induction Training
5. Learner Training
6. Company School Training
7. Retraining or Refresher Training
8. Apprenticeship Training
9. Demonstrations
10. Lectures
TOPIC 4
 Career Planning
 Succession/Career planning refers to the
identifying and tracking high-potential
employees capable of filling higher-level
managerial positions.

 It requires the senior management to

systematically review leadership talent in the
company.

 It provides a set of development exercises

that a manager must complete to be
considered for top management positions.
 Succession planning systems also attract and
retain managerial employees by providing them
with developmental opportunities that they can
complete if upper management is a goal for them.

 High potential employees typically complete an

individual development program that involves :
 Education.
 Executive mentoring.
 Coaching
 Rotation through job assignments.
 Succession Planning constitutes a major
step in almost every industry to understand
and provide the best platform for its high
potential employees who are capable of
being successful in high-level management
positions.
 For the development plans to be effective,
both the employee and the company have
responsibilities that need to be completed.
TOPIC 5
Performance Management
System/Performance Appraisal

 Performance Appraisal is assessment

of an individual’s performance in a
systematic way

 Performance Appraisal is an objective

assessment of an individual’s
performance against well defined
benchmarks
 Purpose of Performance
Appraisal
 Recognition of Individual Performance
 Identification of individual strengths &
weaknesses
 Salary
 Promotion
 Lay Offs
 Identification of poor performers
 HR Planning
 Methods of Performance
Appraisal
 SYSTEMATIC  FUTURE ORIENTED
1. Ranking Method 1. MBO
2. Paired Comparison 2. Assessment centre
Method 3. Psychological
3. Graphic/Linear Scale Appraisal
Method 4. 360 Feedback
4. Forced Choice
Method
5. Grading Method
 Methods of Performance
Appraisal
 SYSTEMATIC
1. Ranking Method- Superior ranks his
subordinates
2. Paired Comparison Method- Rater compares
each employee with every other N(N-1)
2
where, N= No. of subordinates
3. Graphic/Linear Scale Method- Statement on
traits of employee prepared in columns viz.
“Excellent” & “Good”, “ Average”, “ Poor
4. Forced Choice Method- Rater is forced
to select statements which are
readymade
5. Grading Method- Grades are
established like Satisfactory,
Unsatisfactory
6. Checklist Method- Statement on traits of
employee prepared in two columns viz.
“YES” & “NO”
 FUTURE ORIENTED
1. MBO- Peter Drucker- 1954
“MBO is a process through which
organizational goals, plans & control
systems are determined & defined in
joint collaboration between superior
& subordinate managers.
2. Assessment centre- It is central location
where managers come together to have
their participation in job related exercises.

3. Psychological Appraisal- Org. employ full

time industrial psychologist

4. 360 Feedback- It is systematic collection of

performance data on an individual derived
from no. of stakeholders
 Rating Errors
1. Leniency or Severity- Subjective
assessment by rater
2. Central Tendency- Play Safe attitude
of Rater
3. Halo Error- One aspect of individual
performance influences performance
4. Rater Effect- Favoritism
5. Spillover Effect- Depend on past PA
6. Status Effect- Levels of Employees
TOPIC 6
Compensation Management
 It is remuneration an employee
receives in return for his contribution
to the org.

 Compensation of employee
comprises of-
1. Wages & Salary
2. Incentives
3. Fringe Benefits
4. Perquisites
5. Non-monetary benefits
 Components of Employee
Compensation
Compensation

Financial Non-financial

Fringe
Salary/ Benefits
Job Context
Perquisites •Challenging
Incentives •P.F
Wages •Company Car Job
Individual •Gratuity •Club Membership •Responsibilities
Hourly & Plans/ •Medical Care
•Accident,
•Paid Holidays •Recognition
Monthly Group •Growth
•Health, •Furnished House
Rated Plans Prospects
•Group •Etc.
Wages & •Working
Insurance
Salaries •Etc. Conditions

DIRECT INDIRECT
TOPIC 8
Industrial Relations

Definitions
 Complex of inter-relations among
workers, managers, & Govt.

 IR is nature of Relationship between

the employer & employee in an
industrial org.
 Functions of IR
 To Establish cordial relations among mgt &
workers
 To establish a pipeline between workers &
mgt
 To establish a rapport between manager &
employees
 To ensure creative contribution of trade
unions
 To avoid industrial conflicts for production
efficiency
 Functions of IR

 To avoid unhealthy atmosphere in the industry

especially strikes, lockouts etc.

 To raise industrial productivity & to contribute to

economic development of the country

 To ensure better worker’s participation &

involvement in the production process

 To safeguard interest of both workers &

management
 Grievance

 Employees Dissatisfaction or feeling

of personal injustice relating to his/her
employment
Grievance Handling Procedure
Stage 4 NO
Complaint to Grievance
Union Resolved
YES

Stage 3 NO
Grievance
Complaint to Resolved
Divisional Head YES

Stage 2 NO
Grievance
Complaint to Resolved
Departmental Head YES

Stage 1 NO
Grievance
Complaint to Resolved
Sectional Head YES
 Collective Bargaining
“Collective Bargaining is a process in which the
representatives of a labour organization & the
representatives of business organization meet and attempt to
negotiate a contract or agreement, which specifies the
nature of employee-employer union relationship”.
-FLIPPO

 Process involving discussions and negotiations

 'bargaining' – proposals and counter proposals

 to reconcile their conflicting interests

 is a flexible approach
 What are Industrial
Disputes?
Industrial Dispute means any dispute or
differences between employers and
employers or between employers and
workmen or between workmen and workmen
which is connected with the employment or
non-employment or the terms of employment
or with the conditions of labour of any person
can be treated as Industrial Dispute

- Industrial Disputes Act 1947

 Causes of Industrial
Disputes
 Economic causes
1. Wages
2. Bonus
3. Allowances
4. Conditions for work
5. Working hours
6. Leave and holidays without pay
7. Unjust Dismissals
 Non-economic Causes
1. Bad treatment by staff members
2. Political factors
3. Administrative Causes
4. Recognition of workers Organization
5. Strikes in other industries
6. Psychological & Social Causes
7. Work Load
8. Rules/service conditions/safety measures
9. Non-implementation of agreements and awards
 Settlement of Disputes
Methods of Disputes Settlement :

1. Collective Bargaining (C.B)

2. Code of Discipline- Duties & Responsibilities of both
3. Grievance Procedure
4. Arbitration- Neutral Third Party
5. Conciliation- Representatives of both parties
6. Adjudication- Mandatory settlement by labour court
7. Consultative Machineries- Set by Govt. at plant,
industry, State & National Levels
 TOPIC 9
RETIREMENT/
SEPERATION
 Superannuation
 is a special way of saving to provide
yourself with an income when you retire

 it is a pension scheme, (where normal

Pensions are not available). 15% basic
salary is contributed by the employer to this
scheme and most of the places LIC Group
Insurance department manages these
schemes
 Some facts about Superannuation

a) It is a retiral benefit

b) It is normally computed at 15% of the monthly basic

salary. Hence if the basic is Rs.10,000 p.m., the
Superannuation contribution will be Rs.1,500 per
month.

c) The Company opens a Superannuation Fund with an

agency like for example - LIC

d) This Fund is normally invested in Govt. securities /

equity to get returns
VOLUNTARY RETIREMENT
SCHEME
 WHAT IS VRS?
 The Voluntary Retirement Scheme
(VRS) is the latest mantra of many a
corporate and Public sector units.

 VRS is a scheme whereby the

employee is offered to voluntarily
retire from his services before his
retirement date.

 Subject to certain conditions the

company offers VRS to its
employees It is the golden route to
cut the excess flab.
BENEFITS
 The normal benefits that an
employee gets:

1. Provident fund

2. Encashed accumulated leave

3. Gratuity

4. Salary for the notice period

5. Cost of transfer to the hometown

OTHER BENEFITS
 Also to make the scheme very
attractive for the employees they
get other benefits like-

1. Medical insurance
2. Housing loans
3. Subsidies on children's education
loans, etc.
 Resignation

 It means termination of employment at

the instance of the employee.

 A resignation is the formal act of

giving up or quitting one's office or
position.

 A resignation is a personal decision to

exit a position
 Discharge or Dismissal

 Where termination of employment is

initiated by the employer, it is known
as Dismissal or discharge

 The separation of employee is

permanent
 Suspensation

 To bar for a period from a position, or

office, usually as a punishment

 To debar, or cause to withdraw

temporarily, from any privilege, from
the execution of an office, from the
enjoyment of income, etc.;
 Layoff

It is temporary separation of the

employee from his employer

Reasons of Layoffs:
1. Shortage of Raw material, Power

2. Breakdown of Machinery

3. Excess Labour
All The Best…..