Human Resource Management

Dr. Hansa Lysander Manohar

Professor, DoMS
Anna University
 UNIT – 1
UNDERSTANDING
HUMAN RESOURCE
MANAGEMENT
Introduction
Human Resource Management
• process of procuring, developing and maintaining
competent human resources in the organization so
that the goals of an organization are achieved
• ensure the availability of competent and skilled
workforce to an organization

In the context of rapidly changing work environment

• what must HR managers do to develop key results?
• What are the influences that impact the organization?

• What are the implications to the human resource

managers?
Learning objectives
•Importance of human resource management
•Awareness of the influences of human resource practices in
organizations
•Understand the evolution of human resource management
•Analyze how organizations manage human capital
•Identify the key roles of the HR manager
•Describe the challenges of the human resource managers
•Study the role of human resource policies
•Appreciate the influence of technology in decision making in
the workplace
•Explain the importance of human resource accounting and
audit in the workplace
 HUMAN RESOURCE MANAGEMENT

• focuses on all issues related to‘people’

• concerned with practices involved in the
acquisition, development, motivation and
maintenance of people
• ensure the availability of right people for right
jobs so as the organizational goals are achieved
effectively
 IMPORTANCE OF HRM
• people in the organization are instrumental to its
success
• If HRM practices are good, organization will be
effective and efficient
• ‘Effectiveness’- reflected by the success in goal
achievement
• ‘Efficiency’ - reflected by its ability to achieve the
output with very little inputs or resources
• Survival is dependent on the HR manager’s
competence to coordinate activities of all people
in the organization
 EVOLUTION OF HUMAN RESOURCES
MANAGEMENT
• Early years
• Before the twentieth century, vague efforts at organizing labor
• efforts to organize people gained momentum in the beginning of
the industrial revolution
• Mid Years
• 1900 - 1946 : Importance of Personnel Management was
recognized.
• 1910 – 1920: Influence of Scientific Management and Industrial
Psychology developed as a subject interest to
• Scientific experiments conducted to understand the influence of
work conditions and work groups on productivity- Hawthorne
study
•Mid Years - Great Depression (1930)
• organizations could not maintain the labor
employed
• large-scale retrenchment during the 1940s
• ill effects of World War II reflected in HRM
practices world over
• organizations were insensitive to the needs
of their employees
• Started using discussions, role-plays, and
case method - for developing skills of
employees and sensitizing employers
•Later years:
•1946-1970- government intervention
• enactment of laws and enforcement -
Factories Act, Industrial disputes Act,
Workman’s compensation Act, Maternity
Benefit Act, Payment of Gratuities Act etc
• Welfare measures include the need to
provide housing facilities, educational
assistance, crèche, subsistence allowance
etc.
Later years
• Early 1970s -Personnel Management was redefined
in broader terms as Human Resources
Management
• trade unions were most active
• HR managers needed to take more active part in
making the workplace peaceful
• HR departments were born
• evolved into a proactive department encouraging
welfare and development of employees
Later years
•Most important shift observed since the
1990s - management of human resources is
not the exclusive responsibility of the HR
department but of all managers
•Employees of this century are seen as
partners in progress rather than resources
Recent years
•Trends that changed HR since the 2010s - HR
professionals play a vital role in a company’s
market reputation as well as business
growth
•Distributed workforces, agile performance
management, candidate-centricity, a
nuanced diversity footprint, and data-driven
decisions are the essential elements to
maximize HR’s new potential.
Why this shift in HR?
• Younger Job Entrants • Equal Opportunities to
• Older Work Population minorities
• Steady fall in skilled labor • Business scenario
• Well-educated • Lifetime Employment
employees Search
• More white-collar jobs • Cross Cultural Influence
• Entry of Women • Employee
Responsiveness
 Key issues in HRM
• Influence of Culture • Manpower
• Technological Impact Management
• Impact of • Focus on Quality
Communication On • Work Life Balance
Workplace Dynamics • Knowledge
• Work Place Ethics Management
• Understanding Work • Employee Involvement
Force Diversity
Influence of Culture

•World has become a global village

•Different countries, different cultures
•Need to adapt to multi-cultures
•Indian organizations – synthesis of East
and Western culture
TECHNOLOGICAL IMPACT
Influences observed on
• Recruitment
• Selection
• Training and Development
• Motivation and Maintenance
• Human Resource Information System (HRIS)
 Impact Of Communication On
Workplace Dynamics
•Decentralized Workplace
•Formal to informal communication
•Developing Tech Savvy Employees
 WORK PLACE ETHICS

• Ethics prescribes rules or principles that define right

and wrong conduct
• Human Resource Managers
• must be able to make employees understand the
importance of work ethics
• must ensure that the code of ethics is
communicated
• must ensure that all employees strictly adhere to
the code
• Employee surveillance is an ethical dilemma
 WORK FORCE DIVERSITY
• Heterogeneity in work force
• Increase in the number of working women - Questions on
sexual harassments and glass ceilings within the organization
need to be addressed stringently
• Increase in the representation of the minorities- Affirmative
action and inclusive growth policies
• Prohibition of discrimination on the basis of caste, race,
physical abilities, gender, age, nationality or religion unless
there is a need to
• Presence of a larger number of elderly people in the
workforce
• employees from different nationalities and multi cultures
• Emphasis on social equity
MANPOWER MANAGEMENT

•High Attrition
•Managing Contingent Workforce
• Challenges in Employing Contingent Workers
• Kinds Of Contingent Workforce
• Part time employees
• Temporary Employees
• Contract Workers
•Balancing Work Force Requirements
 FOCUS ON QUALITY
•Quality in all aspects – product,
service, process and people issues
•TQM
•Continuous improvement
•Process re-engineering
WORK LIFE BALANCE

•Dual career couples

•Job vs Family
•Family-friendly initiatives
KNOWLEDGE
MANAGEMENT
•Knowledge based organization
•Knowledge Workers
•Knowledge Creation
EMPLOYEE INVOLVEMENT
•Delegation
•participative decision-making
•emphasizing teamwork
•empowerment
Human capital
• Human capital refers to the stock of employee
skills, knowledge and capabilities that may not
show up in a balance sheet but have significant
impact on a firm’s performance
• Human capital lends competitive advantage to
a firm.
• Human resource management necessitates
alignment of HR policies and practices with the
organization’s goals and strategies.
strategies
 Role of Human Resource
Managers
Maintenance Acquisition
Improving Work Conditions Human Resource Planning
Benefits and Services Recruiting
Safety and Health Selection
Employee Relationships Induction and Socialization

HRM
GOALS
Motivation Development
Performance Appraisal Employee Training
Linking Reward to Performance Management Development
Ensuring Satisfaction Organizational Development
Compensation Administration Career Development
HUMAN RESOURCE MANAGEMENT
CHALLENGES

Human Resource Management challenges

in today’s competitive world
1.Environmental Challenges
•Rapid Change
•Work Force Diversity
•Globalization
•Legislation
•Technology
•Job & Family Roles
•Lack of Skills
2. ORGANIZATIONAL
CHALLENGES

•competitive position & flexibility

•organizational restructuring
•issues of downsizing
•self managed teams,
•development of suitable
organizational culture
3. INDIVIDUAL CHALLENGES

• Productivity
• Empowerment
• Brain drain
• Ethics & social responsibility
• Job insecurity
• Matching people &
organization
 LIST OF CHALLENGES TO HUMAN
RESOURCE MANAGER AND % IN
COMPANIES
Challenges / Challenges / Challenges /
% in Companies % in Companies % in Companies
1. Change 5. Compensation
management 7. Succession planning
24%
48% 20%
6. Staffing:
2. Leadership 8. Learning and
Recruitment
development development
and
35% 19%
availability of skilled
3. HR effectiveness local labor
measurement 9. Staffing: Retention
24%
27% 16%
4. Organizational 10. Benefits costs:
effectiveness Health & welfare 13%
25%
 Human resources policies
• Human resources policies provide the framework
by which employees are expected to behave in the
workplace.
• These policies are written statements of the
company’s standards and objectives and include all
areas of employment, including recruitment,
compensation, termination, benefits, employee
relations and leaves of absence
• First there should be clear and consistent
statement of the organization's policies regarding
all conditions of employment and procedures for
their equal and fair implementation
What is the purpose of a
Human Resource Policy?

• The establishment of HR policies can help an

organization demonstrate its commitment
towards HR regulation and corporate
governance.
• HR policies can form the framework in
inculcating the desired organizational culture
HR policies for HR management
functions
1. Compensation and benefits
2. Labor management relations
3. Employment practices and placement
4. Workplace diversity
5. Compensation and benefits
6. Labor management relations
7. Employment practices and placement
8. Workplace diversity
Types of HR Policies
1. Originated Policies
2. Implicit Policies
3. Imposed Policies
4. Appealed Policies
5. General Policies
HUMAN RESOURCE
INFORMATION SYSTEM
(HRIS)
• An HRIS may be defined as the system used to
acquire, store, manipulate, analyze, retrieve,
and distribute pertinent information regarding
organization’s human resource
• A human resource information system (HRIS) is
an integrated system designed to provide
information used in HR decision making
 HRIS
HRIS facilitates HR decision-making in the
following areas:
1. Man-power planning
2. Recruitment & selection
3. Employment, including
promotion, transfer, etc.
4. Education & training
 DECISION MAKING
• The top level management requires Decision Support
System or DSS to frame organizational strategy in respect
of various aspects of organization. They may frame the
strategy in respect of human resources of the
organization, but they have to take strategic decisions
requiring an interactive computer based system which is
known as decision support system.
• The middle level management has to make tactical
decisions for which they need the data base system
known as management information system or MIS.
• Lower level management has to make operational
decisions for actual work performance, the system they
require for the purpose is known as the electronic data
processing system or EDP system
Human Resource Accounting (HRA)
• Human Resource Accounting is the process of
assigning, budgeting, and reporting the cost of
human resources incurred in an organization,
including wages, salaries training and
development expenses.
• It is a comprehensive accounting of expenses
spent towards recruitment of employees,
training and development, salaries & benefits
and in return knowing their contribution to
organization towards achieving the targeted
profitability.
Methods of Valuation of Human
Resources

1. Historical method
2. Replacement cost
method
3. Present value method
4. Opportunity cost
method
5. Standard cost method
 HR AUDIT
• HR audit is very much useful to achieve the
organizational goals and objectives.
• It is a scientific tool to assess the effectiveness of HR
functions of an organization.
• Human Resource Audit is the process of systematic
verification of job analysis and design, recruitment
and selection, orientation and placement, training
and development, performance appraisal and job
evaluation, employee and executive remuneration,
motivation and morale, participative management,
communication, welfare and social security, safety
and health, industrial relations, trade unionism, and
disputes and their resolution.
Approaches to Human Resources Audit

Some of the proven approaches adopted

for the purpose of evaluation are:
1. Comparative approach
2. Outside authority approach
3. Statistical approach
4. Compliance approach
5. Management by objectives
(MBO) approach
Steps for a successful HR Audit
The 6 major steps involved in HR Audit
process are:
1. Determine the scope:
2. Develop a plan
3. Gather and analyze the data
4. Produce a report
5. Create an action plan
6. Evaluate the progress
 SUMMARY
• Globalization has necessitated human resource managers to
evolve over the years and change the way they do their work
• Employees are an essential constituent of this global village
and have different expectations, experiences and expertise
• They need to Know the stock of stock of employee skills,
knowledge and capabilities to be more responsive to cross
cultural issues
• The role and challenges are two important issues that the
human resource mangers must address to stay competitive
• Human resource policies plays a proactive role in the
functioning of an organisation
• Technology enables the organization to improve its
productivity
• HR practices need to embark on periodical audits to weed out
inefficiency and keep the organization focused on quality