Chapter: 1 Human resource Management 1.

1 INTRODUCTION
An organization is made up of four resources, namely men, material, money and machinery. Of these, the first one id living one, i.e. human resource and other three are non-living i.e.non human. It is the human/people that make use of non human resources. Hence, people are the most significant resources in an organization. It is man who makes all the difference in organizations. L.F.Urwick had remarked that business houses are made or broken in the long run not by markets or capitals, patents or equipments, but by men. According to Peter F.Drucker, man, of all the resources available to man, can grow and develop. The main objective of this chapter is to present a perspective for human capital management in the Indian context. Accordingly the meaning, objectives, scope and functions become the subject matter of this chapter. Before we define HRM, it seems pertinent to first define the term human resources. In common parlance, human resources mean people. OR Personnel means the persons employed. Personnel management is the management of people employed. Organization may be a manufacturing firm, a business concern, an insurance company, a governmental agency, social organizations, hospital, a university and even families. It may be small or large, simple or complex. An Organization is a human grouping in which work is done for the accomplishment of some specific goals, or missions.

1.2 MEANING & DEFINITION OF HUMAN RESOURCE MANAGEMENT

1.2.1 Human Resource Management means: The management of human resources is viewed as a system in which participants seeks to attain both individuals of group goals. If an analysis is made of this definition it will be seen that personnel management involves procedures and practices through which human resources are managed (i.e. organized and directed) towards the attainment of the individual, social and organizational goals. By controlling and effectively using manpower resources, management tries to produce goods and services for the society. 1.2.2 Definitions: 1.2.2a Human Resource Management involves all management decisions and practices that directly affect or influence the people, or human resources, who work for the Organization. An organizations employees enable an

Organization to achieve its goals, and the management of these human resources is critical to an organizations success. 1.2.2b According to Process Systems View Human Resource Management means: Human Resource Management is the systematic planning, development, and control of a network of inter related process affecting and involving all members of an Organization. Key Terms used in this definition: Process: Process is an identifiable flow of interrelated events moving towards some goal, consequence and end. An example of the human resource management is the staffing process, a flow of events that results in the continuous filling of positions within the Organization. These events include such activities as recruiting applicants, making hiring decisions, and managing career transitions such as transfers and promotions. Flow: Flow implies movement through time and in the direction of a result; Inter-related: implies interaction within the process and between events; Goal and Consequence (Purpose): suggest a human objective; Events: are activities, happenings or change; End: implies some conclusion or consequence that may not necessarily be sought or planned by man. System: System is a particular set of procedures or devices designed to control a process in a predictable way. For e.g. Staffing System of an Organization. As a process it includes: Human Resource Planning; Job and Work Design; Staffing; Training and Development; Performance Appraisal and Review; Compensation and Reward; Employee protection and representation; Organization Improvement. 1.2.2c Human Resource 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 societal objectives are accomplished". Edward Flippo This definition is a comprehensive and covers both the management

functions and the operative functions. The purpose of all these functions is to assist in the accomplishment of basic objectives. 1.2.2 General Definition: Personnel Management is the recruitment, selection, development, utilization of and accommodation to human resources by organizations. The human resources of an organization consists of all individuals regardless of their role, who are engaged in any of the organizations activities. 1.3 Three aspects of Human Resource Management: Welfare Aspect: concerned with working conditions and amenities such as canteens, crches, housing, personal problems of workers, schools and recreations; Labor or Personnel Aspect: concerned with recruitment, placement of employees, remuneration, promotion, incentives, productivity etc.; Industrial Relations Aspect: concerned with trade union negotiations, settlement of industrial disputes, joint consultation and collective bargaining. 1.4 Difference between Personnel Management and Human Resource Management Table: 1 Dimensions PM HRM Nature of relations Pluralist Unitarist or neo-unitarist Perception of conflict Conflict is Conflict is pathological institutionalized Contract Emphasis on compliance Beyond contract commitment Role of procedures Rules dominated Culture and values dominated Planning perspective Adhoc, reactive Integrated, proactive Acceptability of Acceptable Non desirable unions Level of trust Low High Key relation Labour management Customer Managements Role Transactional Transformational Basis of job design Division of labour Teams Key people PM/IR specialist Line people and general mangers Skills acquisition Training and Learning Organization Development Reward Management Standardized job Performance related evaluation 1.5Characteristics of Human Resource Management 9 Human Resource Management is concerned with managing people at

work. It covers all levels of personnel, including blue collared employees and white collared employees; 10 It is concerned with employees, both as individuals as well as group; 11 Human Resource Management is concerned with helping the employees to develop their potentialities and capacities to the maximum possible extent, so that they may derive great satisfaction from their jobs; 12 It is a major part of the general management function and has roots and branches extending throughout and beyond each Organization; 13 Human Resource Management is of a continuous nature; 14 Human Resource Management attempts at getting the willing cooperation of the people for the attainment of the desired goals. HRM can be of full value to an Organization only when it is consistently throughout out and applied at all levels and to all management functions; in corporate policies, in the systems, procedures and in employment practices, etc. this integrative aspect of HRM is, therefore, of vital importance.

Fig, 1 1.6 Objectives of Human Resource Management Objectives are pre-determined ends or goals at which individual or group activity in an Organization is aimed. Objectives can be divided in to two parts: 1.6.1 Primary Objectives: HRMs main goal is the creation of a workforce with the ability and motivation to accomplish the basic organizational goals; They relate to the satisfaction of the personal objectives of the members of an Organization through monetary and non monetary devices; They relate to the satisfaction of community and social objectives, such as serving the customers honestly, promoting a higher standard of living in the community,

bringing comfort and happiness to the society, protecting women and children and providing for aged personnel; To utilize human resource effectively; To establish and maintain a productive and self respecting relationship among all members of an Organization; To establish and maintain an adequate organizational structure; To bring about maximum individual development of the members of an Organization; to maintain a high morale and better human relations inside an Organization by sustaining and improving the conditions which have been established so that employees may stick to their jobs for a longer period; 1.6.2 Secondary Objectives: The secondary objectives aim at achieving the primary objectives economically, efficiently and effectively. 1.7 Functions of Human Resource Management According to different authors HRM functions can be divided in to different categories. Some of the categories are as follows: 15 General and Specific functions; 16 Personnel administration and Industrial relations functions. 17 Managerial and Operative functions 1.7.1 General and Specific functions: General Functions: To conduct personnel research; To assist in the programmes of personnel administration; To develop appraisal plans; To launch education and training programmes; To develop a competent work force; To establish and administer varied personnel services delegated to personnel department. Specific Functions: Employment; Safety; Wage and salary; Benefit Schemes; Community relations and Advice and counseling the employees. 1.7.2 Personnel Administration and Industrial Relations Functions:

Personnel Administration: These functions relate to the function of managing people from the lower to the upper level of the Organization and embraces policy determination as well as implementation of policies by the personnel at the lower levels; Industrial Relations Functions: These functions relate to interactions between the management and the representatives of the unions. Such functions involve all activities of employer employee relationship, such as Organization of the union members, negotiations of contracts, collective bargaining, grievance handling, disciplinary actions, arbitration etc- the purpose of all these being to prevent conflict between two parties. 1.7.3 Managerial and Operative Functions; Managerial Functions: Management is Personnel administration. It is the development of the people and not the direction of the things. Managing people is the heart and essence of being a manager. Thus, a Human Resource Manager is a manager and as such he performs the basic functions of management.

Feedback of significant deviations from planned performance (Managerial Functions) Fig: 2 Operative Functions:These functions are concerned with the activities specifically dealing with procuring, developing, compensating and maintaining an efficient work force. These functions are also known as service functions.

 Procurement Function; Development function; Compensating function; Integrating function; Maintenance function. Managerial Functions: Planning: Is a predetermined course of action. Planning is a hard job, for it involves the ability to think, to predict, to analyze and to control the actions of its personnel and to cope with a complex, dynamic fluid environment. They bridge the gap from where we are to where we want to go. The two important features of planning are research and forecasting. The task of forecasting personnel needs in relation to changes in production or seasonal variations and the leveling out of differences in the production extremely important, both for employees and for management. Therefore, planning and decision making has to be undertaken much in advance of an action so that unforeseen or anticipated problems and events may be properly handled. This as also stressed by the saying: Good managers make things happen. Organizing: An Organization is a means to an end. It is essential to carry out the determined course of action. Complex relationships exist between the specialized departments and the general departments as many top managers are seeking the advice of personnel manager. Thus, Organization establishes relationship among the employees so that they can collectively contribute to the attainment of company goals. Directing: Direction is an important managerial function in building sound industrial relations besides securing employee contributions. Coordination deals with the task of blending efforts in order to ensure successful attainment of an objective. The personnel manager has to coordinate various managers at different levels as far as personnel functions are concerned. Personnel management function should also be coordinated with other functions of management like management of money, machine, and material. Controlling: Controlling involves checking, verifying and comparing of the actualize with the standards, identification of deviations if any and correcting of identified deviations. Thus, action and operation are adjusted to predetermined plans and standards through control. Fig. 3: Functions of Personnel Office/ Personnel Management. Functions of Personnel Office

Managerial Functions

Operative Functions

Planning Organizing

Directing

Controlling Human Relations, Placement.

Employment HRD Compensation

H R P; Performance- Job Evaluation; Motivation; Recruitment; Appraisal; Wage & Salary Morale; Selection; Training; Quality- Circles. Orgn.Change & Dev. Induction; Mgmt. Dev. Fringe Benefits. Career Planning Operative Functions: The operative functions of human Resource Management are related to specific activities of personnel management e.g. employment, development, compensation & Relations. All these functions are interacted by managerial functions. Employment: Employment is concerned with securing and employing the people possessing required kind and level of human resources necessary to achieve the organizational objectives. It covers the functions such as job analysis, human resource planning, recruitment, selection, placement, induction and internal mobility. Human Resource Development: It is the process of improving, molding and changing the skills, knowledge, creative ability, aptitude, attitude, values, commitment etc. based on present and future job and organizational requirements. This function includes Performance Appraisal, Training, Management Development, Career Planning and Development, Internal Mobility (Promotion, Demotion), Organizational Development. Compensation: It is the process of providing adequate, equitable and fair remuneration to the employees. It includes job evaluation, wage and salary administration, incentives, bonus, fringe benefits, social security measures etc. Human Relations: Practicing various human resource policies and

programmes Loire employment, development and compensation and interaction among employees create a sense of relationship between the individual worker and management, among workers and trade unions and management. It is the process of interaction among human beings. Human relations are an area of management in integrating people in to work situation in a way that motivates them to work together productively, cooperatively and with economic, psychological and social satisfaction. 1.8 Human Resource Management Environment HR manager cant perform his job in a vacuum as a number of environmental factors affect the HRM. In fact, these factors influence the Organization through human resources. Environment (with special reference to Human Resource Management): means the totality of all factors, which influence both the Organization and HRM sub system. Fig. 4: Environmental Scanning of HRM Technological Marketing Government & Legal Orgn. Politics Political Unions Finance Production Trade Orgn. Structure Customers

Economic Social & Religious The environment furnishes the macro context and the Organization is the micro unit. The external environment is comprised of those factors, which affect an organizations human resources from outside the Organization. Important among them are: Economic; Social; Political; Governmental; Legal;

 Technological; Manpower in the country; Tradition and culture; Customers; Other organizations; Trade Unions in other organizations. 1.8.1 Internal Environment: The internal environment also affects the job of a personnel manager. The internal environmental factors include Organization objectives, policies, organizational structure, and the functional areas of the Organization with which the personnel manager works continuously like finance, marketing and production. Impact of internal environment factors is profound as they frequently and closely interact with HRM function in an Organization. 1.8.2 External Environment: The influence of external environment on HRM is also equally important, though the severity is comparatively less. People are essentially self-managing. In other words, while people manage other resources, themselves manage personnel. People themselves decide about the nature, time, and place of their employment. And people react to the changing conditions and to the techniques of management unlike money, material and machine. The changes includes in the external environment are: Technological obsolescence; Cultural and social changes; Changes in the policies of govt.; Politics and the like. With the result, the work environment changes thereby affecting their productivity level. Considering the complexities and the challenges in the HRM now and in near future management has to develop sophisticated techniques and efficient specialists to among the personnel on sound lines 1.9 Functional Areas/ Scope of Human Resource Management 18 Organizational planning, development and task specification; 19 Staffing and Employment; 20 Training and Development; 21 Compensation, Wage and Salary administration; 22 Motivation and Incentives; 23 Employee services and Benefits; 24 Employee records; 25 Labor and Industrial Relations; 26 Personnel Research and Personnel Audit.

1.10 Role of HR Practitioner The coordination and integration of activities in an organization just not happen; it has to be worked out. People tend to head off in different directions- to go their own sweet way. They will jot necessarily cooperate with one another. Thus, to begin with, the HR manager should have three main objectives in mind: 27 To gain the commitment and cooperation of all the members in his work group; 28 To get the group into action to achieve agreed objectives; 29 To make the best use of the skills, energies and talents of all the members. In the modern era, the personnel manager typically performs a variety of the roles, such as a role of a conscience, of a counselor, a mediator, a company spokesman, a problem solver and a change agent. He performs many roles as per needs of the situation. Such as: I.The conscience role is that of humanitarian who reminds the management of its moral and ethical obligations to its employees; II. The personnel manager plays the role of a counselor to whom the employees frequently go for consultation and with whom they discuss their marital, health, mental, physical and career problems; III. As a mediator, he plays the role of a peacemaker, offering to settle the disputes that may arise among individuals or groups. He acts a liaison and communicating link between an individual and a group and between labour and management; IV. The personnel a manger has always been a frequent spokesman for or representative of the company because he has a better overall picture of his companys operation, since he deals intimately with many key organizational activities and functions; V. The personnel manager also acts as a problem solver with respect to the issues that involves human resources management and overall long range organizational planning; VI. He works as a change agent within the organization because he is best suited to introduce and implement major institutional changes. He takes initiative for installing organizational development programmes and convinces the top management of their need. It is he who alerts the top management regarding managerial obsolescence in his organization; VII. The personnel manager plays many other roles as well.

Any matter which need someones attention and which no body wants to deal with is, often handled by the personnel department. Such activities may be peripheral but important and crucial to the efficient and effective operation of an organization. It has been now fully recognized that the basic role of the personnel manager if the management of the manpower resources. Such management is concerned with leadership both in-group and individual relationship, and labour management relations. It effectively describes the process of planning, and directing the application, development and utilization is now considered as one of the four main functions, viz. finance, production, marketing, and human relations. The ideal personnel manager is not a decision maker but a counselor not collector of responsibilities but an advisor to help the management make more reliable personnel decisions. In any organization it is these line man who determine the personnel climate for the entire organization. If the personnel man can meet the challenge of staff role he would make the effective contribution to industry.
Personnel Role Advisory: advising management on effective use of human resources Manpower planning: Recruitment, selection etc. Training and development of line man Welfare Role Administrative Role Time keeping Research in personnel and organizational problems Managing services-canteens, transport etc. Group dynamics: group counseling, motivation, leadership, communication etc. Measurement and assessment of individual and group behavior Fire Fighting/Legal Role Grievance handling

Salary and administration

wage Settlement of disputes disciplinary

Human engineering: Handling man machine actions relationship

Collective bargaining

Joint consultation

Table 2 1.11Evaluating HR Function Organizations can promote human excellence by offering a potential site for the flowering most forms of human excellence. Within an organization, if there is meritocracy, people compete for promotion and other rewards on the

basis of good work rather than on the basis of pull. Recognition and rewards for creative ideas, discoveries, inventions, innovations etc. promote creative excellence. The human resource development movement in industry is aimed at facilitating organizationally useful individual growth and development. The more an organization promotes individual or team excellence, the more the organization itself is likely to excel because the work of any organization is dependent on the work of its individual members and employee groups. The human factor across all organizations comprises three basic elements: 30 The people themselves who work in the organization; the skills and capabilities they possess and their attitude towards the company; 31 The management style prevalent in the organization, which usually stems from the top. The style may be aggressive, authoritarian, democratic or laissez faire and each type has a different impact on the way people work as individuals or in groups; 32 The organizational climate i.e. the work atmosphere in the company, as determined by the degree of interpersonal cooperation, the types of conflict resolution, the amount of trustworthiness, the prevalent organizational politics etc.; The quality of HRM practices prevalent in a particular organization can be rated by scrutinizing the following factors: 1.11.1Organization Climate: 33 Do people feel they are giving enough responsibility? 34 Do people know what is expected of them in the shape of objectives and standards of performance? 35 Do people see themselves being fairly rewarded for their work and feel that promotion policies are fair? 36 Do the employees feel that they belong to a worthwhile company and are valuable members of working teams? 37 Is there adequate feedback to people on their performance, whether it is good, bad or indifferent? 38 Is there sufficient to challenge in their jobs? 39 Are people given enough support by their managers or supervisors in the shape of guidance or help? 1.11.2 Type of Management Style: 40 Does it tend to be Autocratic? 41 Does it tend to be Task centered or people centered?

42 Do managers tend to be distant or cold or approachable and friendly? 43 Do managers tend to be hard or soft on people? 44 Thus, an amalgamation of all the factors throws some light as an indicator of the quality of HRM practiced in an organization. PERSONNEL POLICIES The dictionary meaning of policy is a planned action and that plan is a policy. Policy making and planning are, therefore, synonymous. A policy, says Flippo, is a man made rule of pre-determined course of action that is established to guide the performance of work toward the organization objective it is a type of standing plan that serves to guide subordinates in the execution of their tasks. According to Calhoon, personnel polices constitute guides to action. They furnish the general standards or base on which decisions are reached. Their genesis lies in an organizations values, philosophy, concepts and principles. Policies are statements of the organization over all purpose and its objective in the various areas with which its operation are concerned personnel finance production marketing and so on. AIMS AND OBJECTIVE OF PERSONNEL POLICIES The aims of personnel policies should be/are: 45 To enable an organization to fulfill or carry out the main objective which have been laid down as the desirable minima of general employment policy; 46 To ensure that its employees are informed of these items of policy and to secure their cooperation for their attainment; 47 To provide such condition of employment and produces as will enable all the employees to develop a sincere sense of unity with the enterprise and to carry out their duties in the most willing and effective manner; 48 To provide an adequate, competent and trained personnel for all levels and types of management; and motivated them; 49 To protect the common interest of all the parties and recognize the role of trade union in the organization. 50 To provide for a consultative participation by employee in the management of an organization and the framing of condition for this participation, which, however shall not take place in technical, financial or trading policy; 51 To provide an efficient consultative service which aims at creating mutual faith among those who work in the enterprise; By developing management leadership which aims is bold and imaginative and guide by moral values;

 By effectively delegating the human relation aspects of personnel function of line managers by enforcing discipline on the basis of cooperative understanding and humane application of rules and regulation; and By providing for a happy relationship at all levels . 8. To establish the conditions for mutual confidence and avoid confusion misunderstanding between the management and the workers, by developing suggestion plans, joint management councils, work committees, etc., and by performance appraisal discussion; 9. To provide security of employment to workers so that may not be distracted by the uncertainties of their future; 10. To provide an opportunity for growth within the organization to person who are willing to learn and undergo training to improve their future prospects. 11. To provide for the payment of fair an adequate wages and salary to the workers so that their healthy cooperation may be ensure for efficient working of the undertaking; 12. To recognize the work and accomplishment of the employees by offering non-monetary incentives rewards; 13. To create a sense of responsibility on the part of those in authority, for the claims of employees as human being, who should be guaranteed protection of their fundamental rights and offered enough scope for developing their potential. ESSENTIAL CHARACTERSTICS OF A SOUND PERSONNEL POLICY The main features of a good personnel policy are: 52 The statement of any policy should be definite, positive, clear and easily understood by anyone in the organization so that what it proposes to achieve is evident. 53 It should be written in order to preserve it against loss to stimulate careful consideration before its formulation and to prevent the promulgation of numerous, differing and temporary oral policies from multiple sources. 54 It must be reasonably stable but not rigid, i.e., it should be periodically revised, evaluated, assessed and revised and should, therefore, be in tune with the challenge of changes in the environment and should have built in resilience for adjustment from time to time. 55 It must be supplementary to the over-all policy of an organization, for if departmental policy were made such as to come into conflict and violet the company policy, it would be tantamount to insubordination. Peter drucker has observed: the policies of an enterprise have to be balanced

with the kind of reputation an enterprise wants to build up with special reference to the social and human needs, objectives and value. 56 It should be indicate that the management knows that workers prefer to deal with the management on an individual basis. 57 It should recognize the desire of many workers for recognition as groups in many of their relationships. 58 It should be formulated with due regard for the interests of all the concerned parties-the employers, the employees and the public community. 59 It should be the result of a careful analysis of al the available facts. 60 It must provide a two-way communication system between the management and the employees so that the latter are kept informed of the latest developments. In the organization and the employers are aware of the action and reaction of employees on particular issues. 61 It should be consistent with public policy, i.e., with the spirit rather than the letter of the law, so that the intensions and settled course of an organization are appreciated in terms of public opinion from the standpoint of national, economic and social justice for the employees and for the community at large. 62 All interested parties should generally know it. 63 It must have not only the support of the management but also the cooperation of employees at the shop floor level and in the office. 64 Before evolving such a policy, trade unions should be consulted in 65 Matters of industrial relations; and the role of trade unions should be restricted only to this area. 66 It should be progressive and enlightened, and must be consistent with professional practice and philosophy. 67 It must make a measurable impact, which can be evaluate and qualified for the guidance of all concerned, especially in the field of the three Rs of personnel management viz., recruitment, retainment and retirement. 68 It should be uniform throughout the organization, though, in the light of local conditions, slight variation may be permitted in specific policies relating to staffing compensation, benefits and services. 69 It should have a sound base in appropriate theory and should be translable into practices, terms and peculiarities of every department of an enterprise. 70 Except in rare cases, policies should not prescribed detailed procedures.

Features of HRM 71 Strategic i.e. planned, deliberate, seeking to achieve set objectives 72 Capabilities i.e. people or resources with potential (knowledge, skills, and attitudes) which can be developed to contribute to organisational success. 73 Competitive advantage by tapping into and developing these capabilities organisations give themselves an edge over their rivals 74 Integrated that the range of things under HRM (recruitment, selection of employees, their training and development, how they are rewarded) is looked at together not as separate things. HRM is very important to us for the following reasons: 1. Development and Growth of the organisation:HRM paves way for development and growth in the organisation. But how? Can you come out with some answers? By improving the individual capabilities, acquiring necessary cooperation and developing teamwork HRM makes sure that the organization develops and grows well. Goals of the organization are met by HRM by effective motivation and excellent utilization of employees. 2. Creation of healthy culture in the Organization: HRM creates and maintains excellent culture in the organization and it makes people develop and grow. 3. Maintenance of Human Resources: The development, care of Human Resources is done by the HRM.

4. The concept of Human beings is a very crucial and vital factor of production; HRM is gaining more and more importance day by day. It also has important implication in societal development also. IT IS THE HEART AND SOUL OF MODERN MANAGEMENT. Objectives of Human Resource Management: What are the objectives of the human resource management? 1. The first and foremost objective of human resource management is to have a highly committed, eligible, talented, and happy workers. 2. Development of employees:- An employee does not come alone into the organization. What does he bring? He brings with himself abilities, attitude, behavior, personality etc.. Individual has the objective of enhancing his personal growth. He seeks the organization for realization of his personal growth. Organization needs employees for fulfillment of organization objectives. There is an element of mutuality of interests here. Individual and organization need each other for fulfillment of their objectives. There is a need for encouragement of employees in an organization to develop and grow. If sufficient is given for growth it will leads to the efficient working, proper maintenance, motivation and retention of work force. f the personal growth of employees are hindered absenteeism, turnover will increase and performance and satisfaction will come down. Hence HRM aims and strives for the development of the employees. 3. Growth and development of the organization:HRM objective is to bring about the overall development and growth of the organization. The HRM department serves all the department of the

organization. Behavior analysis of employee is focused at individual, group, and organizational levels. Integration of individuals and groups is done in an organization structure is maintained. Overall the objective of organizational development is kept at the forefront. 4. The development of HR function and climate:- The objective of HRM is to develop an effective HR functions for development and maintenance of human functions. HRM also has the objective of maintaining an excellent HR culture.
Chapter One An Introduction to International Human Resource Management Why International Human Resource Management Increasing globalization, firms and employees in them moving all over the world. Major problems in international operations because of human resource management blunders Hence need to understand human resource management in a global perspective

Why International Human Resource Management:110 senior human resource and industrial relations managers mentioned the most compelling issues in human resource management The role of HR in International Operations Managing a Multicultural Workforce Developing Managerial Talent in a Global Business Environment Three Approaches to IHRM Cross-cultural management o Examine human behavior within organizations from an international perspective

Comparative HRM and Industrial Relations o Seeks to describe, compare and analyze HRM systems and IR in different countries

HRM in multinational firms What does IHRM add into the Traditional Framework of HRM?

Types of employees

o o o

Within and cross-cultural workforce diversity Coordination Communication

Human resource activities o o o Procurement Allocation Utilization of human resources

Nation/country categories where firms expand and operate o o o Host country Parent country Third country

Some Terms Defined Host Country National (HCN): Belongs to the Country where the subsidiary is located Parent Country National (PCN): Belongs to the Country where the firm has its headquarters Third Country Nationals (TCN): Belongs to any other country and is employed by the firm What is an expatriate? An employee who is working and temporarily residing in a foreign country o o Some firms prefer to use the term international assignees Expatriates are PCNs from the parent country operations, TCNs transferred to either HQ or another subsidiary, and HCNs transferred into the parent country

Global flow of HR: more complexity in activities and more involvement in employees' lives The Expatriate Problem

High Expatriate Failure Rates Average cost per failure to the parent firm can be as high as three times the expatriates annual domestic salary plus the cost of relocation Between 16% & 40% of all American employees sent abroad to developed nations, and almost 70% sent to less developed nations return home early Reasons for Expatriate Failure

Inability of spouse to adjust Managers inability to adjust

Other family problems Managers personal or emotional maturity Inability to cope with larger overseas responsibility Lack of technical competence Difficulties with new environment Differences between Domestic HRM and IHRM

More HR activities: taxation, culture orientation, administrative services The need for a broader perspective: cater to multiple needs More involvement in employees personal lives: adjustment, spouses, children Changes in emphasis as the workforce mix of expatriates and locals varies: fairness Risk exposure: expatriate failure, terrorism Broader external influences: government regulations, ways of conduct Differences between Domestic HRM and IHRM: variables

Complexity involved in operating in different countries, varied nationalities of employees The different Cultural Environment The industry or industries with which the MNC is involved Attitudes of Senior Management Extent of reliance of MNC on home country domestic market Approaches To International Human Resource Management

Ethnocentric: Highly centralized. HQ controls PCNs dominate. Polycentric: Decentralized. Each subsidiary has some degree of decision making autonomy. HCNs manage subsidiaries. Geocentric: Ignores nationality in favor of ability and competence needs in a worldwide integrated business strategy.

1.INTERNATIONAL HRM Global Human Resource Management is a process concerned broadly with recruiting of persons, training them and putting them to the most productive usage. It is also concerned with maintaining of congenial international industrial relations. It is the essential prerequisite for the success of the international firm owning to its complexities. Broadly defined, international human resource management (IHRM) is the process of procuring, allocating, and effectively utilizing

human resources in a multinational corporation. If the MNC is simply exporting its products, with only a few small offices in foreign locations, then the task of the international HR manager is relatively simple. However, in global firms human resource managers must achieve two somewhat conflicting strategic objectives. First, they must integrate human resource policies and practices across a number of subsidiaries in different countries so that overall corporate objectives can be achieved. At the same time, the approach to HRM must be sufficiently flexible to allow for significant differences in the type of HR policies and practices that are most effective in different business and cultural settings. 1.1 Characteristics of International HR 75 International Human Resource Management (GHRM) -- the planning, selection, training, employment, and evaluation of employees for global operations. 76 GHR managers serve in an advisory or support role to line managers by providing guidelines, searching, training, and evaluating employees.

77

How a firm recruits, trains, and places skilled personnel in its worldwide value chains sets it apart from competition. The combined knowledge, skills, and experiences of employees are distinctive and provide myriad advantages to the firms operations worldwide.

1.2 Regulatory Policies of International HR: 78 Four major tasks of HRM 1.2.1 Staffing policy. Management training and development. Performance appraisal. Compensation policy.

STAFFING POLICY: a. b. c. Selecting individuals with requisite skills to do a particular job. Tool for developing and promoting corporate culture. Types of Staffing Policy Ethnocentric Polycentric Geocentric

79 80 81 82

Ethnocentric Policy: Key management positions filled by parent-country nationals. Best suited to international businesses. Advantages:

 83

Overcomes lack of qualified managers in host nation. Unified culture. Helps transfer core competencies.

Disadvantages: Produces resentment in host country. Can lead to cultural myopia.

84 85 86 87 88

Polycentric Policy: Host-country nationals manage subsidiaries. Parent companies nationals hold key headquarter positions. Best suited to multi-domestic businesses. Advantages: Alleviates cultural myopia. Inexpensive to implement. Helps transfer core competencies.

89

Disadvantages: Limits opportunity to gain experience of host country nationals outside their own country. Can create gap between home and host country operations.

90 91 92 93

Geocentric Policy: Seek best people, regardless of nationality. Best suited to global and trans-national businesses. Advantages: Enables the firm to make best use of its human resources. Equips executives to work in a number of cultures. Helps build strong unifying culture and informal management network.

94

Disadvantages: National immigration policies may limit implementation. Expensive to implement due to training and relocation.

Compensation structure can be a problem.

The aim of the Human Resources Strategy is to support staff. This it will do by developing and promoting good HR practice for the recruitment and development of high quality staff, by effectively managing their performance and by providing appropriate rewards and flexible opportunities that allow individuals to manage their own development. Core Functions of International Human resources are: 95 96 97 98 99 Recruitment Selection Process Expatriates Performance Appraisal Training and Development

100 Compensation Sources of Recruitment MODERN TECHNIQUES AND SOURCES OF RECRUITMENT FOR GLOBAL COMPANIES 1) Walk-In -: The busy global organizations and the rapid changing companies do not find time to perform various functions of recruitment. Therefore they advise the candidates to attend for an interview directly and without a prior application on a specified date, time and at a specified place. 2) Consult-In -: The busy and dynamic global companies encourage the potential job seekers to approach them personally and consult them regarding the jobs. The international companies select the suitable candidates from among such candidates though the selection process. 3) Head-Hunting -: The global companies request the professional organizations to search for the best candidates particularly for the senior executive positions. The professional organizations search for the most suitable candidates and advice the global company regarding the filling up of the positions. 4) Body-Shopping -: Professional organizations and the hi-tech training institutes develop the pool of human resources for possible employment. The prospective employers contact these organizations to recruit the candidates. The body shoppers appoint people for their organization and provide the required/specific employees to various organizations on request. In fact, body shoppers collect fee/commission from the organizations and pay the salary/benefits to the employees. 5) Business Alliance -: It is like acquisitions, mergers, and takeovers help in getting human resources. In addition, the companies do also have alliances in sharing their human resources on ad-hoc basis. 6) Tele-Recruitment -: The technological revolutions in telecommunication helped the organizations to use internet as source of recruitment. Organizations advertise the job vacancies though the World Wide Web internet. The job seekers send their application though e-mails or internet websites. STEPS IN THE SELECTION PROCESS Step 1: Preliminary Selection Preliminary selection of applicants is often done by setting minimum standards for the job, and communicating these standards to the employees, and agencies who help them recruit. The fact that some potential applicants may not apply because of their inability to meet

the minimum requirements serves as an initial screening device. Then, when reviewing resumes and application forms, firms are further able to screen out unacceptable job candidates. At this point, firms can also assign priorities to the resumes so that the most promising candidates may be seen first. Step 2: Employment Tests One way to ensure that selection decisions are based on objective data, is to use employment tests. Employment tests provide firms with objective data for purposes of comparing applicants. Examples of such tests include; paper and pencil test, manual dexterity and strength tests, and simulation exercises. Employment Tests: Validation To be useful, employment test must be valid. Validity requires that the test scores relate to actual job performance. Hence, the use of tests is not necessarily a simple process. Whereas a firm may be inclined to use an "off-the-shelf" product, such a test may bear little resemblance to the job-related tasks a successful applicant might be required to do. Before using a test, firms should ensure that they are, in fact, valid. Tests must be validated on those jobs to which tests are being applied and, tests must be validated for all groups to which tests are being applied. Employment Tests: Reliability Not only must employment test be valid, they must also be reliable. That is, employment tests should yield consistent results. An employment test should give a similar score each time the person takes the test (tests that rely on luck are not reliable). Very often, paper and pencil tests are used to test knowledge. A firm could use a paper and pencil knowledge test to ascertain an applicant's knowledge of computer programming skills or to test whether or not an applicant understands government regulations governing an industry. Generally, knowledge tests have good reliability, but their validity must be tested before they are used. A keyboarding test, testing an applicant's keyboarding speed and accuracy, is an example of a manual dexterity or performance test. Performance tests measure the applicant's ability to perform some part of the job for which applicants are to be hired. Often, there is an assumption of validity insofar as the test includes a representative sample of the work the applicant may be required to do. Firms must be cautious not to use tests that might discriminate against any minority group. An in-basket exercise, in which administrative activities are simulated and an applicant's abilities to deal with these activities is evaluated, is one example of a simulation exercise. Step 3: Selection Interview Selecting the best candidate for the job is the #1 priority of the selection process. The employment interview is conducted to learn more about the suitability of people under consideration for a particular job and is one further obstacle for the applicant to overcome. The interview is one further means of reducing the number of people who might be eligible for the job. The selection interview proceeds in a series of stages. Initially, the interviewer needs to be prepared. Part of this preparation includes deciding where to hold the interviews and which type of interview to conduct. Preparation also includes carefully reading through and making notes on the applicants' application forms and resumes. At this stage, interviewers should make frequent reference to the job (job description) to compare the applicant's background with the job's requirements. The preparatory stage also includes developing a series of job-related questions. During the interview, the interviewer should have an outline of questions, on which to take notes. During the interview process itself, initially, the interviewer(s) should ensure the creation of rapport between interviewer(s) and the interviewee. Next, the two parties can engage in the exchange of information. Once the interview has been terminated, the interviewer(s) must set aside some time to evaluate the notes they have taken during the process. Step 4: Verification of References Personal References

Usually provided by friends or family.

Objectivity and candor are questionable.

Employment References

Differ from personal references. Discuss the applicant's work history. Questionable usefulness

former employers are unlikely to be candid

Useful primarily as confirmation of prior employment. Frequently omitted entirely from the selection process.

Employment References: the Telephone Inquiry

Fast. Cheap. Voice inflections or hesitations to blunt questions may be very informative. Less than 22% seek negative information. Approx. 48% used to verify application information.

Step 5: Medical Evaluation

Generally a health checklist

o o

health information accident information

Occasionally the checklist is supplemented by a physical examination Rationale:

o o o
Caution:

employer may be entitled to lower health or life insurance rates for company-paid insurance may be required by provincial or local health officials may be used to determine whether the applicant can handle physical or mental stress

a congenital health condition may be considered a disability failure to hire an applicant due to a disability may be seen as discrimination against a qualified applicant

Step 6: Supervisory Interview Since the immediate supervisor is ultimately responsible for new workers, he or she should have input into the hiring decision. The supervisor is better able to evaluate the applicant's technical capabilities and is in a better position to answer the interviewee's job-related questions. Further, the supervisor's personal commitment to the success of the new employee is higher if the supervisor has played a role in the hiring decision. Step 7: Realistic Job Preview The realistic job preview involves showing the applicant(s) the job site in order to acquaint them with the work setting, commonly used equipment, and prospective co-workers. The realistic job preview is intended to prevent initial job dissatisfaction with a job by presenting a realistic view of the job. Research shows that job turnover is lower when realistic job previews are used. Step 8: Hiring Decision The actual hiring of an applicant constitutes the end of the selection process. At this stage, successful (as well as unsuccessful) applicants must be notified of the firm's decision. Since money and effort has been spent on all applicants, the HR department may wish to consider even the unsuccessful applicants for other openings in the organization. The applications of unsuccessful applicants are often kept on file and the applications of successful applicants will be retained in the employees' personnel files. No matter what the form of the job offer, the principle is generally the same: do not make promises or statements that you cannot or do not intend to keep. Such statements can lead to expensive litigation if it is later decided to terminate the employee. When a job offer is made, it should include the following information:

Position offered. Location of the job. Salary (although sometimes salary must be negotiated before the applicant will accept). Benefits. Starting date. Any papers or information that should be brought on the first day of work. A date (or time) by which the applicant must respond to your job offer, so you can move on to the next candidate if your first choice doesn't accept.

Benefits. Starting date. Any papers or information that should be brought on the first day of work. A date (or time) by which the applicant must respond to your job offer, so you can move on to the next candidate if your first

choice doesn't accept.

The interviewing process. Did employment tests support or help the hiring decision? If not, maybe the firm will have not the kinds of test it administering. Further the evaluation process should help the firm decide if the time and cost involved in the testing is worth it.

EXPATRIATES Global companies, after selecting the candidates place them on the jobs in various countries, including the home country of the employee. But, the employees of the global companies are also placed in foreign countries. Even those employees who are placed initially in their home countries are sometimes transferred to various foreign countries. Thus the employees of global companies mostly work and live in foreign countries and their family members also live in foreign countries. 1.2.2 TRAINING AND DEVELOPMENT: Training is an act of increasing the knowledge and skill of an employee for doing a particular job. Importance of Training and Development - It leads to 101 Improved job knowledge and skills at all levels of the organization 102 Improved morale of the human resource 103 Improved profitability and more positive attitudes towards profit-orientation 104 Improved relation between boss and subordinated 105 Improved understanding of culture of various countries Need for Training and Development for Global Jobs 106 To match employee specifications with the job requirement and organizational needs 107 To achieve organizational viability and the transformation process 108 To meet the challenges of technological advancement 109 To understand the organizational complexity 110 To make the employee and his family members familiar with the language, customs, traditions etc of the foreign country 1.2.3 PERFORMANCE APPRAISAL: It is a method of evaluating employee behavior relating to expected work and behavior. Appraising the employee performance on foreign jobs is a highly complicated task as expectations of global company are multifarious. Objectives - The objectives of performance appraisal are to create and maintain a satisfactory level of performance, to contribute to the employee growth and development through training and to guide the job changes with the help of continuous ranking. Appraisers - The appraisers may be any person who has a thorough knowledge about the job content, content to appraised, standards of

content and the one who observes the employee while performing a job. Typical Appraisers are: 111 Supervisors 112 Peers 113 Subordinates 114 Consultants 115 Customers 116 Users of Services 1.2.4 COMPENSATION: It is the amount of remuneration paid to the employees. Expatriate pay - It is mostly based on the balance sheet approach. Under the balance sheet approach, the compensation package enables the expatriate employees in various countries to maintain the same standard of living. Gratuity - Expatriate employees are paid gratuity at a fixed rate for every year of completion of services in the foreign country Allowances - Expatriate employees are paid various allowances like car allowances, resettlement allowances, housing allowances etc Taxable - Some countries pay tax-free salary. Most of the countries pay taxable salary and gratuity Profit Sharing & ESOP The Multinational corporations in order to motivate the employees for higher performance introduced a scheme of Profit Sharing. The Employee Stock Option allows the employees to purchase the share of the company at a fixed and reduced rate The advantages of stock ownership includes 117 The plan enables the MNCs to retain efficient employees with them. 118 It encourages the employees to improve performance. 119 This scheme establishes significance of team effort among employees. 120 It increases employee involvement and Participation. G.FACTORS AFFECTING GLOBAL HRM Managing human resources in different cultures, economies, and legal systems presents some challenges. However, when well done, HR management pays dividends. A seven-year study in Britain of over 100 foreign companies showed that good HR management, as well as other factors, accounted for more of the variance in profitability and productivity than did technology, or research and development. The most common obstacles to effective HR management are cross-cultural adaptation, different organizational/workforce values, differences in management style, and management turnover. Doing business globally requires that adaptations be made to reflect these factors. It is crucial that such concerns be seen as interrelated by managers and professionals as they do business and establish operations globally. Figure 2.1 depicts the general considerations for HR managers with global responsibilities. Each of those factors will be examined briefly.

Fig.2.1 2.1 Legal and Political Factors The nature and stability of political systems vary from country to country. U.S. firms are accustomed to a relatively stable political system, and the same is true in many of the other developed countries in Europe. Although presidents, prime ministers, premiers, governors, senators, and representatives may change, the legal systems are well-established, and global firms can depend on continuity and consistency. However, in many other nations, the legal and political systems are turbulent. Some governments regularly are overthrown by military coups. Others are ruled by dictators and despots who use their power to require international firms to buy goods and services from hostcountry firms owned or controlled by the rulers or the rulers families. In some parts of the world, one-party rule has led to pervasive corruption, while in others there are so many parties those governments changes constantly. Also, legal systems vary in character and stability, with business contracts sometimes becoming unenforceable because of internal political factors. International firms may have to decide strategically when to comply with certain laws and regulations and when to ignore them because of operational or political reasons. Another issue involves ethics. Because of restrictions imposed on U.S.-based firms through the Foreign Corrupt Practices Act (FCPA), a fine line exists between paying agent fees, which is legal, and bribery, which is illegal. HR regulations and laws vary among countries in character and detail. In many Western European countries, laws on labor unions and employment make it difficult to reduce the number of workers because required payments to former employees can be very high. Equal employment legislation exists to varying degrees. In some countries, laws address issues such as employment discrimination and sexual harassment. In others, because of religious or ethical differences, employment discrimination may be an accepted practice. All of these factors reveal that it is crucial for HR professionals to conduct a comprehensive review of the political environment and employment-related laws before beginning operations in a country. The role and nature of labor unions should be a part of that review. 2.2 Economic Factors Economic factors affect the other three factors. Different countries have different economic systems. Some even still operate with a modified version of communism, which has essentially failed. For example, in China communism is the official economic approach. But as the government attempts to move to a more mixed model, it is using unemployment and layoffs to reduce government enterprises bloated with too many workers. Many lesser-developed nations are receptive to foreign investment in order to create jobs for their growing populations. Global firms often obtain significantly cheaper labor rates in these countries than they do in Western Europe, Japan, and the United States. However, whether firms can realize significant profits in developing nations may be determined by currency fluctuations and restrictions on transfer of earnings. Also, political instability can lead to situations in which the assets of foreign firms are seized. In addition, nations with weak economies may not be able to invest in maintaining and upgrading the necessary elements of their infrastructures, such as roads, electric power, schools, and telecommunications. The absence of good infrastructures may make it more difficult to convince managers from the United States or Japan to take assignments overseas. Economic conditions vary greatly. Cost of living is a major economic consideration for global corporations. In many developed countries, especially in Europe, unemployment has grown, but employment restrictions and wage levels remain high. Consequently, many European firms are transferring jobs to lower-wage countries, as Mercedes-Benz did at its Alabama plant. In addition, both personal and corporate tax rates are quite high. These factors all must be evaluated as part of the process of deciding whether to begin or purchase operations in foreign countries.

2.3. Cultural Factors Cultural forces represent another important concern affecting international HR management. Culture is composed of the societal forces affecting the values, beliefs, and actions of a distinct group of people. Cultural differences certainly exist between nations, but significant cultural differences exist within countries also. One only has to look at the conflicts caused by religion or ethnicity in Central Europe and other parts of the world to see the importance of culture on international organizations. Getting individuals from different ethnic or tribal backgrounds working together may be difficult in some parts of the world. Culture can lead to ethical differences among countries. One widely used way to classify and compare cultures has been developed by Geert Hofstede, a Dutch scholar and researcher. Hofstede conducted research on over 100,000 IBM employees in 53 countries, and he identified five dimensions useful in identifying and comparing culture. A review of each of those dimensions follows.

HUMAN RESOURCE MANAGEMENT ( H R M ) Definition 1 Integration HRM is a series of integrated decisions that form the employment relationships; their quality contributes to the ability of the organizations and the employees to achieve their objectives. Definition 2 Influencing HRM 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 achieving organizational objectives. This is true, regardless of the type of the organization government, business, education, health, recreational, or social action. Definition 3 Applicability HRM 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. MEANING OF HRM: HRM is management function that helps managers to recruit, select, train and develop members for an organization. Obviously HRM is concerned with the peoples dimensions in organizations. HRM refers to set of programs, functions, and activities designed and carried out Core elements of HRM

121People: Organizations mean people. It is the people who staff and manage organizations. 122Management: HRM involves application of management functions and principles for acquisitioning,
developing, maintaining and remunerating employees in organizations.

123Integration & Consistency: Decisions regarding people must be integrated and consistent. 124Influence: Decisions must influence the effectiveness of organization resulting into betterment
services to customers in the form of high quality products supplied at reasonable cost.

of

125Applicability: 126Societal

HRM principles are applicable to business as well as non-business organizations too, such as education, health, recreation and the like. OBJECTIVES OF HRM: Objectives: To be ethically and socially responsible to the needs and challenges of the society while minimizing the negative impact of such demands upon the organization. Objectives: To recognize the role of HRM in bringing about organizational effectiveness. HRM is only means to achieve to assist the organization with its primary objectives. Objectives: To maintain departments contribution and level of services at a level appropriate to the organizations needs.

127Organizational 128Functional 129Personal

Objectives: To assist employees in achieving their personal goals, at least in so far as these goals enhance the individuals contribution to the organization. This is necessary to maintain employee performance and satisfaction for the purpose of maintaining, retaining and motivating the employees in the organization. SCOPE OF HRM: From Entry to the Exit of an employee in the organization Scope of HRM can be described based on the following activities of HRM. Based on these activities we can summarize the scope of HRM into 7 different categories as mentioned below after the activities. Lets check out both of them. HRM Activities 130 HR Planning 131 Job Analysis 132 Job Design

133 134 135 136 137 138 139 140 141 142 143 144 145 146 147 148 149 150

Recruitment & Selection Orientation & Placement Training & Development Performance Appraisals Job Evaluation Employee and Executive Remuneration Motivation Communication Welfare Safety & Health Industrial Relations 7 Categories of Scope of HRM Introduction to HRM Employee Hiring Employee and Executive Remuneration Employee Motivation Employee Maintenance Industrial Relations Prospects of HRM ROLE OF HRM

151Advisory

Role: HRM advises management on the solutions to any problems affecting people, personnel policies and procedures. a. Personnel Policies: Organization Structure, Social Responsibility, Employment Terms & Conditions, Compensation, Career & Promotion, Training & Development and Industrial Relations. b. Personnel Procedures: Relating to manpower planning procedures, recruitment and selection procedures, and employment procedures, training procedures, management development procedures, performance appraisal procedures, compensation procedures, industrial relations procedures and health and safety procedures.

152Functional

Role: The personnel function interprets and helps to communicate personnel policies. It provides guidance to managers, which will ensure that agreed policies are implemented.

153Service Role: Personnel function provides services that need to be carried out by full time specialists. 154Humanitarian Role: Reminding moral and ethical obligations to employees 155Counselor: Consultations to employees about marital, health, mental, physical and career problems. 156Mediator: Playing the role of a peacemaker during disputes, conflicts between individuals and groups
and management.

These services constitute the main activities carried out by personnel departments and involve the implementation of the policies and procedures described above. Role of HR Managers (Today)

157Spokesman:
operations.

To represent of the company because he has better overall picture of his companys

158Problem 159Change

Solver: Solving problems of overall human resource management and long-term organizational planning. Agent: Introducing and implementing institutional changes and installing organizational development programs

160Management

of Manpower Resources: Broadly concerned with leadership both in the group and individual relationships and labor-management relations. Role of HR Managers (Future) 161 Protection and enhancement of human and non-human resources 162 Finding the best way of using people to accomplish organizational goals 163 Improve organizational performance 164 Integration of techniques of information technology with the human resources 165 Utilizing behavioral scientists in the best way for his people 166 Meeting challenges of increasing organizational effectiveness 167 Managing diverse workforce FUNCTIONS OF HRM ALONG WITH OBJECTIVES HRM Objectives Supporting HRM Functions Social Objectives (3) Legal Compliance Benefits Union Management Relations Organizational Objectives (7) Human Resource Planning Employee Relations Recruitment & Selection

Functional Objectives (3) Personal Objectives (5)

Training & Development Performance Appraisals Placement & Orientation Employee Assessment Performance Appraisals Placement & Orientation Employee Assessment Training & Development Performance Appraisals Placement & Orientation Compensation Employee Assessment Managerial Functions of HRM

168Planning: Plan and research about wage trends, labor market conditions, union demands and other
personnel benefits. Forecasting manpower needs etc.

169Organizing: Organizing manpower and material resources by creating authorities and responsibilities
for the achievement of organizational goals and objectives.

170Staffing: Recruitment & Selection 171Directing: Issuance of orders and instructions, providing guidance and motivation of employees to
follow the path laid-down.

172Controlling: Regulating personnel activities and policies according to plans. Observations and comparisons of deviations
Operational Functions of HRM

173Procurement: Planning, Recruitment and Selection, Induction and Placement 174Development: Training, Development, Career planning and counseling. 175Compensation: Wage and Salary determination and administration 176Integration: Integration of human resources with organization. 177Maintenance: Sustaining and improving working conditions, retentions, employee communication 178Separations: Managing separations caused by resignations, terminations, lay offs, death, medical sickness etc. 179Globalization:

CHALLENGES OF HRM IN INDIAN ECONOMY or CHALLENGES OF MODERN MANAGEMENT

- Growing internationalization of business has its impact on HRM in terms of problems of unfamiliar laws, languages, practices, competitions, attitudes, management styles, work ethics and more. HR managers have a challenge to deal with more functions, more heterogeneous functions and more involvement in employees personal life. 180 Corporate Re-organizations: - Reorganization relates to mergers and acquisitions, joint ventures, take over, internal restructuring of organizations. In these situations, it is difficult to imagine circumstances that pose a greater challenge for HRM than reorganizations itself. It is a challenge to manage employees anxiety, uncertainties, insecurities and fears during these dynamic trends. 181 New Organizational forms: - The basic challenge to HRM comes from the changing character of competitions. The competition is not between individual firms but between constellations of firm. Major companies are operating through a complex web of strategic alliances, forgings with local suppliers, etc. These relationships give birth to completely new forms of organizational structure, which highly depend upon a regular exchange of people and information. The challenge for HRM is to cope with the implications of these newly networked relations more and more, in place of more comfortable hierarchical relationships that existed within the organizations for ages in the past.

182Changing Demographics of Workforce: - Changes in workforce are largely reflected by dual career 183Changed

couples, large chunk of young blood between age old superannuating employees, working mothers, more educated and aware workers etc. These dynamic workforces have their own implications for HR managers and from HRM point of view is a true challenge to handle. employee expectations: - With the changes in workforce demographics, employee expectations and attitudes have also transformed. Traditional allurements like job security, house, and remunerations are not much attractive today, rather employees are demanding empowerment and equality with management. Hence it is a challenge for HRM to redesign the profile of workers, and discover new methods of hiring, training, remunerating and motivating employees.

184New Industrial Relations Approach: - In todays dynamic world, even unions have understood that
strikes and militancy have lost their relevance and unions are greatly affected by it. The trade union membership has fallen drastically worldwide and the future of labor movement is in danger. The challenge before HRM is to adopt a proactive industrial relations approach which should enable HR specialist to look into challenges unfolding in the future and to be prepared to convert them into opportunities.

185Renewed

People Focus: - The need of todays world and business is the peoples approach. The structure, strategy, systems approach which worked in post war era is no more relevant in todays economic environment which is characterized by over capacities and intense competition. The challenge of HR manager is to focus on people and make them justifiable and sustainable. the Managers: - Managers are unique tribe in any society, they believe they are class apart. They demand decision-making, bossism, and operational freedom. However in the post liberalization era, freedom given to managers is grossly misused to get rid of talented and hard working juniors. The challenge of HRM is how to manage this tribe? How to make them realize that the freedom given to them is to enable them make quick decisions in the interest of the organization and not to resort to witch-hunting. of society. The dramatic increase of women workers, minorities and other backward communities in the workforce has resulted in the need for organizations to reexamine their policies, practices and values. In the name of global competition, productivity and quality the interests of the society around should not be sacrificed. It is a challenge of todays HR managers to see that these weaker sections are neither denied their rightful jobs nor are discriminated against while in service. to the success of organizations: - The biggest challenge to an HR manager is to make all employees contribute to the success of the organization in an ethical and socially responsible way. Because societys well being to a large extent depends on its organizations.

186Managing

187Weaker Society interests: - Another challenge for HRM is to protect the interest of weaker sections

188Contribution

STRATEGIC HUMAN RESOURCE MANAGEMENT: Strategy: Strategy is a way of doing something. It includes the formulation of goals and set of action plans for accomplishment of that goal. Strategic Management: A Process of formulating, implementing and evaluating business strategies to achieve organizational objectives is called Strategic Management Definition of Strategic Management: Strategic Management is that set of managerial decisions and actions that determine the long-term performance of a corporation. It includes environmental scanning, strategy formulation, strategy implementation and evaluation and control. The study of strategic management therefore emphasizes monitoring and evaluating environmental opportunities and threats in the light of a corporations strengths and weaknesses. Steps in Strategic Management:

189Environmental Scanning: Analyze the Opportunities and Threats in External Environment 190Strategy Formulation: Formulate Strategies to match Strengths and Weaknesses. It can be done at
Corporate level, Business Unit Level and Functional Level.

191Strategy Implementation: Implement the Strategies 192Evaluation & Control: Ensure the organizational objectives are met.
IMPORTANCE & BENEFITS OF STRATEGIC MANAGEMENT Allows identification, prioritization and exploration of opportunities. Provides an objective view of management problems. Represents framework for improved co-ordination and control Minimizes the effects of adverse conditions and changes Allows major decisions to better support established objectives Allows more effective allocation of time and resources Allows fewer resources and lesser time devoted to correcting ad hoc decisions Creates framework for internal communication Helps to integrate the individual behaviors Provides basis for the clarification of responsibilities Encourages forward thinking Encourages favorable attitude towards change. ROLE OF HRM IN STRATEGIC MANAGEMENT Role in Strategy Formulation: HRM is in a unique position to supply competitive intelligence that may be useful in strategy formulation. Details regarding advanced incentive plans used by competitors, opinion survey data from employees, elicit information about customer complaints, information about pending 193 194 195 196 197 198 199 200 201 202 203 204

legislation etc. can be provided by HRM. Unique HR capabilities serve as a driving force in strategy formulation. Role in Strategy Implementation: HRM supplies the company with a competent and willing workforce for executing strategies. It is important to remember that linking strategy and HRM effectively requires more than selection from a series of practice choices. The challenge is to develop a configuration of HR practice choices that help implement the organizations strategy and enhance its competitiveness. HUMAN RESOURCE DEVELOPMENT Definition 1: Organizing and enhancing capacities to produce. HRD is a process of organizing and enhancing the physical, mental and emotional capacities of individuals for productive work. Definition 2: Bring possibility of performance and growth HRD means to bring about the possibility of performance improvement and individual growth. Human resource development is a process to help people to acquire competencies and to increase their knowledge, skills and capabilities for better performance and higher productivity. Proactive HRD Strategies for long term planning and growth In todays fast changing, challenging and competitive environment HRD has to take a proactive approach that is to seek preventive care in human relations. Using HRD strategies maximizations of efficiency and productivity could be achieved through qualitative growth of people with capabilities and potentialities to grow and develop. HRD is always a function of proper utilization of creative opportunities and available environment through acquisition of knowledge, skills and attitudes necessary for productive efforts. Long-term growth can also be planned by creating highly inspired groups of employees with high aspirations to diversify around core competencies and to build new organizational responses for coping with change. A proactive HRD strategy can implement activities that are geared up and directed at improving personal competence and productive potentialities of human resources. Following strategic choices can be considered which would help todays organizations to survive and grow. Change Management: Manage change properly and become an effective change agent rather than being a victim of change itself. Values: Adopt proactive HRD measures, which encourage values of openness, trust, autonomy, proactivity and experimentation. Maximize productivity and efficiency: Through qualitative growth of people with capabilities and potentialities to grow and develop thrive to maximize productivity and efficiency of the organization. Activities directed to competence building: HRD activities need to be geared up and directed at improving personal competence and productive potentialities of manpower resources. TEAM EFFECTIVENESS What is the definition of a team? A team is defined as a reasonably small group of people, who bring to the table a set of complementary and appropriate skills, and who hold themselves mutually accountable for achieving a clear and identifiable set of goals. Teams can be very effective. In many situations teams can achieve more than individuals working on their own. Teams can bring to bear a wider range of skills and experience to solve a problem. Teams also produce better quality decisions. When a team has been working on a problem, and they have a sense of commitment to the common solution What do we mean by team effectiveness? 205 A team can be considered to be effective if their output is judged to meet or exceed the expectations of the people who receive the output. Producing a quality output is not enough to judge the effectiveness of the team. 206 The second criteria, is that the team should still be able function effectively after they have completed their task. It should not be torn apart by dissension. 207 Finally, effectiveness is judged by whether the team feels satisfied with its efforts. If the team members are pleased with their efforts, if the experience has been a good one, if time spent away from their normal work has been worth the effort, the team has likely been effective. What then are the factors that contribute towards an effective team? There are three areas of group behavior that must be addressed for teams to be effective. The team must work hard. The effort that the team puts in to get the job done is dependent on whether the nature of the task motivates the members of the team and whether the goals are challenging.The team must have the right mix of skills to bring to the table. These skills include technical, problem solving and interpersonal skills. The team must be able to develop appropriate approaches to problem solving. This depends on developing a plan of attack and using appropriate techniques for analysis. The following factors contribute to hard work, skill development and effective problem solving strategies: The task itself should be motivating. 208 The task itself should be seen as being worthwhile. It needs to be a whole piece of work with a clear and visible outcome so that people can feel a sense of ownership. 209 The outcome of the task should be perceived as being important to other people's lives. It should affect others in the organization or impact on the external customer. 210 The job should provide the team with an opportunity for self-regulation. They should decide how the work is to be done. Meaningful feedback should be provided on the how well the team is performing. The team needs challenging goals, which are clearly defined.

211 When challenging goals are set the team will mobilize its efforts to find innovative ways to achieve feats that may have been considered impossible. Providing a challenging job is the most important motivator to sustain group effort. 212 Goals provide a sense of direction to the team so that when conflict occurs it is possible to channel the conflict more constructively by returning to the goals for direction. 213 The team needs to buy in to the goals. They must have the opportunity to buy in and commit to achieving the goals. Goals need to be challenging, but not impossible to achieve. They also need to be measurable so that progress towards achieving them can be monitored and results confirmed. Rewards are important. 214 The rewards need to suit the personal characteristics of the people on the team. 215 Whatever form the reward takes, it is important that group effort be recognized. One should avoid the destructive effect of trying to single out individuals from the group, when there has been a group effort. 216 Rewards merely reinforce these conditions for fostering group effort. The team should have the right mix of skills. 217 The right mix of skills should be brought to the task at hand. It is also a question of carefully reviewing the job to determine what relevant skills is required and selecting staff so that the team has the right balance. Providing relevant training then makes up any shortfall in skills. 218 Technical skills are required. For teams who are trying to improve a process that cuts across department boundaries, each function should be represented. One should achieve a balance of skills. This means avoiding having a preponderance of skills and experience in one specialized area. Sheer numbers may weigh the solution towards the dominant group. 219 In the case of permanent work teams it is likely that team members will not have all the task relevant skills at the onset. When the group is new, it is likely that members will bring narrow skills learned in their old roles. They will need to develop broader skills for the new job. To ensure that this is done, training and coaching should be provided. 220 The members of the team need to have problem solving and decision-making skills as well as technical skills. When a business is making its first venture into team based work, it is likely that people will not have a good grasp of the techniques related to problem analysis and solution. 221 These relevant skills must be acquired, so it will be necessary to provide training. Over a period of time staff will become experienced in problem solving techniques and the organization will develop a repertoire of skills among the staff so this training will not always be necessary. 222 Interpersonal skills are also important. This is not as obvious as it may sound. Most people do not listen well. Listening is much more than being quiet when some else is talking. Active listening is required. Many people do not speak to the point but ramble on or go off at a tangent. Most people do not take criticism well and tend to be defensive about their own opinions. Agree on a code of conduct. 223 At the beginning of the team project it is important to develop a code of conduct for meetings. The team needs to agree on a set of rules to ensure that their efforts are purposeful and that all members contribute to the work. 224 The most critical rules pertain to attendance, open discussion, using an analytical approach, not pulling rank over other members, planning the work and sharing work assignments. This will ensure that the work is done well and done on time. The team must develop effective problem solving strategies. 225 For the team to be able to develop an appropriate strategy, it must have a clear definition of the problem, know what resources it has available and the limits, and understand the expectations. It must then develop a problem-solving plan, based on the approach suggested in the section on continuous improvement. 226 When this does not happen, people are passive. Their skills and knowledge are not utilized and they waste their time. Special teams have special issues. From the perspective of organisational improvement we are interested in three types of teams. One is the problem solving team, another is the work team and then there is the senior management team.Problem solving teams are set up with a clearly defined task to investigate a problem and recommend a solution. Sometimes the same team will go on to implement the solution. When their task is completed the team is disbanded and members go back to their normal organisational duties. 227 There are two important issues facing these teams. One is getting started and the other is handing over the recommendations for implementation. The key to getting started is to ensure that the team is committed to achieving an agreed set of goals. Goals serve to focus the team's effort. 228 Implementation is important. It will not just happen; it must be planned. The implementers must be brought into the solution stage so that they develop a sense of ownership towards the solution and buy into it. The best way to do this is to have the problem solving team do the implementation. 229 Another approach is to phase the implementers into the team so that the membership changes prior to the implementation. Whatever approach is used one should remember that the idea is to implement a solution and not to produce a report. 230 Work teams are different in that they are a fixed part of the organization. They have an ongoing

function, which is to control a set of activities that make up a discrete operation in the overall business process. They need to focus on the critical factors in their process and to control these factors to ensure a quality product.

Job design is defined as the application of motivational theories to the structure Of work for improving productivity and satisfaction (Daft, 1994: 530). Job design has Also been defined as the process by which managers decide individual job tasks and Authority (Gibson, Ivancevich & Donnelly, 1994: 505). The meaning derived from These definitions refers to job design as something that is used and decided upon by Managers of the organization..
What is "job design"? Job design refers to the way that a set of tasks, or an entire job, is organized. Job design helps to determine: what tasks are done, how the tasks are done, how many tasks are done, and in what order the tasks are done. It takes into account all factors which affect the work, and organizes the content and tasks so that the whole job is less likely to be a risk to the employee. Job design involves administrative areas such as: job rotation, job enlargement, task/machine pacing, work breaks, and working hours. A well designed job will encourage a variety of 'good' body positions, have reasonable strength requirements, require a reasonable amount of mental activity, and help foster feelings of achievement and self-esteem. Job design principles can address problems such as: work overload, work underload, repetitiveness, limited control over work, isolation, shiftwork, delays in filling vacant positions,

excessive working hours, and limited understanding of the whole job process. Job design is sometimes considered as a way to help deal with stress in the workplace. See the OSH Answers document "Workplace Stress - General" for more information. Good job design accommodates employees' mental and physical characteristics by paying attention to:

muscular energy such as work/rest schedules or pace of work, and mental energy such as boring versus extremely difficult tasks. Good job design:

allows for employee input. Employees should have the option to vary activities according to personal needs, work habits, and the circumstances in the workplace. gives employees a sense of accomplishment. includes training so employees know what tasks to do and how to do them properly. provides good work/rest schedules. allows for an adjustment period for physically demanding jobs. provides feedback to the employees about their performance. minimizes energy expenditure and force requirements. balances static and dynamic work. Job design is an ongoing process. The goal is to make adjustments as conditions or tasks change within the workplace. Approaches to job design include: Job Enlargement: Job enlargement changes the jobs to include more and/or different tasks. Job enlargement should add interest to the work but may or may not give employees more responsibility. Job Rotation: Job rotation moves employees from one task to another. It distributes the group tasks among a number of employees. Job Enrichment: Job enrichment allows employees to assume more responsibility, accountability, and independence when learning new tasks or to allow for greater participation and new opportunities. Work Design (Job Engineering): Work design allows employees to see how the work methods, layout and handling procedures link together as well as the interaction between people and machines. What are the overall goals of job design? Goals can be in many difference areas and include: Task Variety To alleviate boredom, avoid both excessive static body positions and repetitive movements. Design jobs to have a variety of tasks that require changes in body position, muscles used, and mental activities.

Two methods are job enlargement and job rotation. For example, if an employee normally assembles parts, the job may be enlarged to include new tasks such as work planning, inspection / quality control, or maintenance. Alternatively, the tasks may include working in the same department, but changing tasks every hour. For example, in a laundry facility employees can rotate between various stations (sorting, washer, dryer, iron, etc) as long as it provides for a change in physical or mental expenditure. Work Breaks / Rest Breaks Rest breaks help alleviate the problems of unavoidable repetitive movements or static body positions. More frequent but shorter breaks (sometimes called "micro breaks") are sometimes preferable to fewer long breaks. During rest breaks, encourage employees to change body position and to exercise. It is important that employees stretch and use different muscle groups. If the employee has been very active, a rest break should include a stationary activity or stretching. Allowance for an Adjustment Period When work demands physical effort, have an adjustment period for new employees and for all employees after holidays, layoffs, or illnesses. Allow time to become accustomed to the physical demands of work by gradually "getting in shape." Employees who work in extreme hot or cold conditions also need time to acclimatize. Provide Training Training in correct work procedures and equipment operation is needed so that employees understand what is expected of them and how to work safely. Training should be organized, consistent and ongoing. It may occur in a classroom or on the job. Vary Mental Activities Tasks should be coordinated so that they are balanced during the day for the individual employee as well as balanced among a group of employees. You may want to allow the employee some degree of choice as to what types of mental tasks they want to do and when. This choice will allow the employee to do tasks when best suited to their 'alertness' patterns during the day. Some people may prefer routine tasks in the morning (such as checklists or filling in forms) and save tasks such as problem solving until the afternoon, or vice versa.

Job Rotation
Job Rotation: Job rotation moves employees from one task to another. It distributes the group tasks among a number of employees.
BenefitsofJobRotation Some of the major benefits of job rotation are:

It provides the employees with opportunities to broaden the horizon of knowledge, skills, and abilities by working in different departments, business units, functions, and countries Identification of Knowledge, skills, and attitudes (KSAs) required It determines the areas where improvement is required Assessment of the employees who have the potential and caliber for filling the position

A well planned job rotation programme in an organization has immense potential of positive

impact on job satisfaction, engagement of people and finally on retention of people. Few of the outcomes of job rotation with respect to the individual are:

Job enrichment Overall development Intrinsic motivation to perform caused by newer challenges Career development Leadership development Aligning competencies with organizational requirements Lower attrition rates Performance improvement driven by unique view points of new people .

Where as for an organization, the benefits could include some or all of the following:

Definition: Job Enrichment is the addition to a job of tasks that increase the amount of employee control or responsibility. It is a vertical expansion of the job as opposed to the horizontal expansion of a job, which is called job enlargement. Examples: We use job enrichment to make work more challenging and rewarding for our employees to make it easier to keep them. Definition: Job Enlargement is the horizontal expansion of a job. It involves the addition of tasks at the same level of skill and responsibility. It is done to keep workers from getting bored. It is different than job enrichment (see sidebar). Examples: Small companies may not have as many opportunities for promotions, so they try to motivate employees through job enlargement.

Job enlargement gives employee's a variety of tasks to perform that have the same level of skill and responsibility (Horizontal expansion). Job enlargement reduces the amount of specialization required by the employee and makes the job more interesting. Job rotation allows employees to work in different departments or jobs in an organization to gain better understanding of the operation as a whole. Job rotation also includes a horizontal expansion of duties as it does not increase the level of responsibility, but it does help build new skills. Job enrichment allows employees to take on some of the responsibilities usually assigned to management.

ROLE OF THE HUMANRESOURCEMANAGEMENT The role of the hrm can be clearly explained from the following points: 1.HR Business Partner: HR Business Partner is just a human being. As the HR Business Partner is in a daily contact with the internal client of HR, the relationship with the internal client gets closer and closer. And the internal client wants solutions, which makes his/her life easier in the organization. When the internal client has a chance to get some advantage, he/she would be crazy not to try to get the advantage with the small help from the HR Business Partner. On the other hand HRM has a lot of its goals and tasks. And the managers have not to be comfortable with all the tasks, which are ordered by the HRM. In that case, Human Resources Management need strong HR Business Partners with a good relationship with the internal client to push the tasks and to get their buy-in. But after some time the HR Business Partners tend to fight for the internal client more as it can increase their

popularity. There is just one cure for this issue. The HR Business Partners must have to change their internal clients to serve from time to time. It is not to break all the relationships, but it helps to build new ones and the new HR Business Partner has a different opinion and can bring better solutions. The HR Business Partner should not serve the same internal clients for a long period. 2. role of Human Resources in Recruitment: Clearly defined role of Human Resources in Recruitment process is very important for measuring the success of the whole Recruitment Process. The overall setting of the HR Role in Recruitment is directly linked to Recruitment Strategy and HR Strategy. The Recruitment Strategy has clearly define the role of Human Resources and of Hiring Managers as it is a very important for setting the correct measures and to identify potential gaps in the whole recruitment process. A traditional role of HR in Recruitment was an administrative part of the whole process. The HRM was responsible for maintaining the vacancies advertised and monitored, but the real impact of HRM to the performance of the whole recruitment process was minimal. But as the role of Human Resources in the business was increasing, the HR Strategy was changed. From making the process working to the real management of HR Processes and the Recruitment Process was the first to manage. The Recruitment Strategy changed - the efficiency and costs to the company were more important. The HR Role in Recruitment changed and HRM:

decides about the design of the recruitment processes and to decide about the split of roles and responsibilities between Human Resources and Hiring Manager decides about the right profile of the candidate decides about the sources of candidates decides about the measures to be monitored to measure the success of the process

The role of HR in Recruitment is very important as HRM is the function to work on the development of the recruitment process and to make the process very competitive on the market. As the job market gets more and more competitive, the clearly defined HR Role in Recruitment will be growing quickly. HRM is not a function to conduct all the interviews today, the main role of Human Resources is to make the recruitment process more attractive and competitive on the job market. 3. Hr in the organization: Human Resources becomes one of the most important components of the organization. The people are a real human capital in the organization, which demands huge investments. Focusing those investments into the human capital are the main role of Human Resources.

Modern Human Resources Management has four main roles in the organization:

business partner change agent employee advocate administration expert

These four basic roles of Human Resources allow HR professionals to help the organization to identify the basic needs in human capital development and to provide managers with a help to develop their subordinates. Human Resources is not a department to take care of employees, it is the role of managers. HRM function has to provide managers with tools to manage, lead and develop their employees to maintain competitive on the market. HRM function has the potential to identify the gaps in the organization and HRM can help to provide the organization with the implementation plan to fill these gaps and to ensure the best investments are done. The human capital becomes the most expensive part of the organization and HRM has to be prepared to take care of these investments.

4. Hr role in the business: HR is not a department about a rocket science. The main goal of Human Resources is to keep efficient and cost saving operation with the human capital of the organization. Human Resources must know its HR Role. The HR Department must fight for its place within the organization. There are companies, where Human Resources is really a strong department and there companies, where Human Resources is a department to be ignored. When HR knows its position within the organization it can start to play its role. The roles are pretty well defined by David Ulrich. The role of HR can be divided into 4 main segments:

Business Partner Employee Advocate Change Agent Admin Star

It is important to mention, the 4 roles have the same importance. The HR Department

cannot decide about the stress to one role and ignoring issues in different segments. All the roles must be played at the same level to be a trustful business partner by other managers.

HR Role is easy to be defined, but to act according the model needs a lot of smart people inside Human Resources, who can distinguish the priorities and strategic tasks, which will help the whole organization. 5. Hr strategy and business strategy: Human Resources Strategy must follow the Business Strategy. It is very easy statement, but in many companies this easy rule is not followed. You can find a lot companies, which provide really sophisticated services to the customers, but their Human Resources should be called more Personal Administration Department. And many factories, which have really just basic needs in the area of human capital development have a very strong HR function. HRM is a very expensive function for companies and each company should have a strategy in human resources area consistent with the overall business strategy. The HRM has to decide about the correct HR Strategy to be applied to fully meets the requests of the organization at the best return on investment into the human capital. The main drivers for deciding about the appropriate HR Strategy should be:

competition on the market complexity of skills and competencies required possibility of investments into human capital

The HR Strategy must clearly react to these conditions and it has also project the future development supposed by the overall business strategy. And it is the main task of the HR Management to find a suitable solution to make a complex alignment of the HR Strategy and Business Strategy. 6. Hr as a business partner: HRM is usually organized as as a typical service organization. It has some Front Office, Back Office and Experts. Front Office deals with internal and external clients, Back Office processes the requests from Front Office and clients and Experts - develop new procedures and processes based on the requests of clients and from monitoring the market for best practices. In Front Office HR Business Partners are the most common position. The Front Office part of Human Resources is usually the weakest part of the whole function. The employees, HR Business Partners, are under a constant pressure and they have to be really clever. The main competencies and skills of the HR Business Partner are:

a deep knowledge of the internal client a deep knowledge of the processes and procedures conducted at the internal client a deep knowledge of HR procedures and policies a knowledge of employees working at the internal client a knowledge of the competition and external job market

The main role of the HR Business Partner is to provide the managers with a help how to work with HR policies and procedures. And - to help managers to work with their staff - to manage, to lead and to develop them to be more successful in the future.

Explain the HRM Model?

Nature of HRM Human Resource Planning Job Analysis Recruitment Selection Placement Training and Development Remuneration Motivation Participative Management Communication Safety and Health Welfare

Promotions etc Industrial Relations Trade Unionism Disputes And their Settlement Future of HRM

The HRM model contains all HR activities. When these activities are discharged effectively, they will result in a competent and willing workforce who will help realize organizational goals. There is another variable in the model environment. It may be stated that the HR function does not operate in vacuum. It is influenced by several internal and external forces like economic, technological, political, legal, organizational, and professional conditions. HRM: is a management function that helps managers recruit, select, train, and develop members for an organization. Human Resource Planning: is understood as the process of forecasting an organizations future demand for, and supply of, the right type of people in the right number. Job Analysis: is the process of studying and collecting information relating to the operations and responsibilities of a specific job. The immediate products of this analysis are job descriptions and job specification. Recruitment: is the process of finding and attracting capable applicants for employment. The process begins when new recruits are sought and ends when their applications are submitted. The result is a pool of applicants from which new employees are selected.

Selection: is the process of differentiating between applicants in order to identify (and hire) those with greater likelihood of success in a job. Placement: is understood as the allocation of people to jobs. It is the assignment or reassignment of an employee to a new or different job. Training and development: it is an attempt to improve current or future employee performance by increasing an employees ability to perform through learning, usually by changing the employees attitude or increasing his or her skills and knowledge. The need for training and development is determined by employees performance deficiency, computed as follows: Training and development need = Standard performance Actual performance Remuneration: is the compensation an employee receives in return for his or her contribution to the organization. Motivation: is a process that starts with a psychological or physiological deficiency or need that activates behavior or a drive that is aimed at a goal or an incentive. Participative management: Workers participation may broadly be taken to cover all terms of association of workers and their representatives with the decision making process, ranging from exchange of information, consultations, decisions and negotiations to more institutionalized forms such as the presence of workers members on management or supervisory boards or even management by workers themselves as practiced in Yugoslavia. ((ILO) Communication: may be understood as the process of exchanging information, and understanding among people. Safety and health: Safety means freedom from the occurrence or risk of injury or loss. In order to ensure the continuing good health of their employees, the HRM focuses on the

need for healthy workers and health services. Welfare: as defined by ILO at its Asian Regional Conference, defined labour welfare as a term which is understood to include such services, facilities, and amenities as may be established in or in the vicinity of undertakings to enable the person employed in them to perform their work in healthy, congenial surroundings and to provide them with amenities conducive to good health and high morale. Promotions: means an improvement in pay, prestige, position and responsibilities of an employee within his or her organization. Transfer: involves a change in the job (accompanied by a change in the place of the job) of an employee without a change in the responsibilities or remuneration. Separations: Lay-offs, resignations and dismissals separate employees from the employers. Industrial relations: is concerned with the systems, rules and procedures used by unions and employers to determine the reward for effort and other conditions of employment, to protect the interests of the employed and their employers, and to regulate the ways in which employers treat their employees. Trade Unions: are voluntary organizations of workers or employers formed to promote and protect their interests through collective action. Disputes and their settlement: Industrial disputes mean any dispute or difference between employers and employers, or between employers and workmen, or between workmen and workmen, which is connected with the employment or non-employment or terms of employment or with the conditions of labour of any person.

CONCEPT TESTING QUESTIONS Q 1. Meaning and Definition (of all concepts for every chapter) Q 2. Difference between: personnel management and HRM Dimension 1. Employment contract Personnel Management HRM

Careful delineation of Aims to go beyond written contracts contract. 2. Rules Importance of devising clear Can do, outlook, impatience rules with rule 3. Guide to management Procedures Business need action 4. Behaviour referent Norms/ customs and Values/mission practices 5. Managerial task vis--vis Monitoring Nurturing labour 6. Key relations Labour management Customer 7. Initiatives Piecemeal Integrated 8. Speed of decision Slow Fast 9. Management role Transactional Transformational leadership 10. Communication Indirect Direct 11. Prized management Negotiation Facilitation skills 12. Selection Separate, marginal task Integrated, key task 13. Pay Job evaluation Performance related 14. Conditions Separately negotiated Harmonization 15. Labour management Collective-bargaining Individual contracts contracts 16. Job categories and grades Many Few 17. Job design Division of labour 18. Conflict handling Reach temporary truce 19. Training and Controlled access to courses development 20. Focus of attention for Personnel procedures interventions Team work Manage climate and culture Learning companies Wide ranging structural and strategies cultural, personnel

21. Respect for employees

Labour is treated as a tool People are treated as assets which is expendable and to be used for the benefit of replaceable an organization, its employees and the society as a whole Interests of the organization Mutuality of interests are uppermost Precedes HRM Latest in the evolution of the subject

22. Shared interest 23. Evolution

GROUP 1 (TOPICS COVERED) Personnel management Human resource management Strategic HRM New trends in HRM 1] PERSONNEL MANAGEMENT DEFINITIONS OF PERSONNEL MANAGEMENT/ HRM The term personnel management is defined in different ways. The following definitions are worth noting: (1) According to Edwin 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 societal objectives are accomplished". (2) According to George R. Terry, "Personnel management is concerned with the obtaining and maintaining of a satisfactory and satisfied, work force". (3) According to Walter D. Scott, "Personnel management is concerned with the attaining of maximum individual development; desirable working relationship between employer and employees, and an effective moulding of human resources as contrasted with physical resources". (4) According to British Institute of Personnel Management, London, "Personnel Management is that part of management which is concerned with the people at work and with their relationship within an enterprise". OBJECTIVES/PURPOSES OF PERSONNEL MANAGEMENT / HUMAN

RESOURCE MANAGEMENT: The basic objective of personnel management is to maintain efficient team of workers for the benefit of the organization. In addition, to provide opportunities of self-development to employees and finally to maintain congenial work atmosphere and inter-personnel relations are the objectives of personnel management. Personnel management aims at giving fair treatment to employees as regard wages, 'welfare facilities, non-monetary benefits, working conditions and so on. The objectives of HRM are derived from the basic objectives of an organization. In order

to achieve organizational objectives, integration of employer's interest and employee interests is necessary. The objectives of personnel management/HRM in any industrial organization can be summarized as under. (1) To attain maximum individual development (self-development) of the members of an organization and also to utilize available human resources (with the organization) fully and effectively. (2) To mould effectively the human resources. (3) To establish desirable working relationships between employer and employees and between groups of employees. (4) To ensure satisfaction to the workers so that they are freely ready to work. (5) To improve the service rendered by the enterprise to the society through better employee morale, which leads to more efficient individual and group performance. (6) To establish and maintain a productive and self respecting relationship among all the members of an organization. (7) To ensure the availability of a competent and willing workforce to the organization for its progress and prosperity. (8) To help organization to achieve its goals by providing well trained, efficient and properly motivated employees. (9) To maintain high morale and good human relations within the organization for the benefit of employer and employees. (10) To secure the integration of all the individuals and groups with the organization by reconciling individual/group goals with those of an organization.

2] HUMAN RESOURCE MANAGEMENT

MEANING AND DEFINITION

Personnel refers to the employees working in an organization at different levels. Personnel management (also called human resource management) is that aspect of total business management, which deals with human relationships within an organization. Personnel represent human resource, which is different from material resources. Human resource is the most productive and most versatile. In addition, the manpower in an organization needs human treatment. Employees have a capacity to feel, think and even to react. Management has to deal with the employees in a careful and tactful manner. Material resources such as land, machines, raw materials, equipment, etc. are easy to manage. This is because they have no capacity to feel or think or react. This is not the case with human resource i.e. manpower. Man and machines are not on par and must not be treated in the same manner. This is because of all the resources manpower is the only resource, which does not depreciate, with the passage of time. According to Peter F. Druckert UtIle prosperity, if not the survival of any business depend on the performance of its managers of tomorrow." The material resources alone will not help the organization to achieve its objectives. For this, effective co-ordination and utilization of material and human resources are required. This suggests the importance of human resources.

The human resource is very important and useful. It should be nurtured and used for the benefit of the organization. This is a challenging job before personnel manager/management. The organization can make rapid progress only when the employees are satisfied and co-operative. On the other hand, the organization will have to face various problems and difficulties, if the employees are not co-operative but hostile. This indicates that human resource is most strategic and critical determinant of growth of a business unit. Every organization needs loyal, efficient and satisfied labour force. For this, adequate attention should be given to personnel management.

OBJECTIVES OF HRM

Same as objectives of personnel management (given above) FUNCTIONS OF HRM

A personnel manager has to perform the basic functions of management. These managerial functions include' planning, organizing, directing and controlling personnel. The operative functions of the department are: procurement of staff, development of staff through training, payment of compensation to staff i.e. wages and salaries, integration of manpower i.e. fair reconciliation of individual, social and organizational goals and interests and maintenance of staff i.e. providing them safety at the work place and also to offer welfare facilities and conveniences to employees. In brief, personnel management involves the following operational functions:

231Procurement of manpower: Procurement means acquiring the manpower required by an organization from time-to-time. The basic Principle in procurement is "right man for the right job". The procurement function includes manpower planning and forecasting, recruitment, selection, appointment, placement and induction of employees so as to have a team of efficient and capable employees for the benefits of the organization. Even promotions and transfers are covered by this broad personnel function. 232Development of manpower: Development of manpower (human resource development) means planning and execution of the training programmes for all categories of employees in order to develop new skills and qualities required for working at the higher level. Manpower development is possible through training and career development programmes and not simply by offering attractive wages to workers. Executive development programmes are introduced for the benefit of higher-level managers Similarly; future manpower requirement will be, met internally through HRD programmes. It aims at educating and training employees for the improvement of overall performance of an organization. HRD (Human Resource Development) programmes are for education, training and development

of existing manpower in an organization. This is for facing new problems and challenges likely to develop in the near future.

233 Compensation payment to manpower employed: One function of HRM is to pay compensation (in monetary form) to employees for the services rendered. For this, a fair system of remuneration payment (wages and salaries) needs to be introduced. Remuneration to employees should be attractive so that the labour force will be satisfied and disputes, etc. will be minimized. Fair wage payment acts as a motivating factor. 234Integration of interests of manpower and the organization: Manpower is interested in wage payment while organization is interested in higher profits, consumer loyalty, market reputation and so on. HRM has to reconcile the interests of the individual members of the organization with those of the organization.

235 Maintenance of manpower: This manpower function relating to maintaining satisfied manpower in the organization through the provision of welfare facilities. For this, attention needs to be given to health and safety measures, maintenance of proper working conditions at the work place, provision of welfare facilities and other non-monetary benefits so as to create efficient and satisfied labour force with high morale. Even collective bargaining and workers participation come within this broad personnel function. 236 Provision of welfare facilities: Employees are offered various welfare facilities. They include medical, educational, recreation, housing, transport and so on.

237Misc. functions: Misc functions under HRM include maintenance of service records of employees (which are used for promotions/transfers performance

appraisal, etc.), promotions and transfers of employees, maintaining cordial industrial relations, introduction of rational grievance procedure, performance evaluation of employees, career planning of employees, maintenance of discipline, administering the policies with regard to disciplinary action and compliance of various labour laws. EVOLUTION OF HRM IN INDIA The importance of personnel/human resources management is now universally accepted and India is not an exception to this rule. In India, large business enterprises, public sector enterprises and even medium and small enterprises appoint personnel manager or human resources development (HRD) manager to look after the personnel functions such as recruitment, promotions and transfers, training and manpower development, provision of welfare facilities, compensation management and so on. The term HRM is a relatively new term emerged during the 1970s. It is now used as a better and meaningful substitute to personnel management. HRM is wider in scope and has its distinct philosophy. The process of industrial development started in India rather late. It was during the British Rule and that too after the First World War that textile, jute, iron and steel and other organised industries started in India. Recruitment, wage payment, welfare facilities and other personnel problems were noted only when labour class was employed on a large scale in the industrial sector. This is the starting period for personnel management in India. In the early British period and prior to that personnel management and personnel functions were absent, (Reference to some personnel functions and systematic management of resources was made in Kautilya's Arthashastra during the 4th century Be.) as industrial activities were extremely limited. They were also conducted on a small scale. As compared to India, the industrial growth was rapid in Europe. As a result, the concept of personnel functions and personnel management made rapid progress. The concept of personnel management function in India is based on similar concept developed in Europe much earlier.

The personnel function in India has been the product(outcome) of various factors such as industrial growth, labour, legislation, exploitation of workers in the early period and their demand for certain basic necessities of life. (e.g. fair wage, weekly, holiday, essential facilities at the work place)The need for labour officers in Indian industry was felt/realized

as early as 1929 for the protection of labour force in industrial units. In 1931, the members of Bombay Mill owners' Association appointed Labour Officers in their textile mills (on voluntary basis) for the settlement of grievances and disputes of employees. Similar arrangement was introduced in the jute mills in Bengal (under the leadership of Jute Mills Association). The labour welfare officers were given the responsibility to promote sports and welfare activities and provide food shops (canteen facility) to workers. After Independence, many pro labour legislations were made for the protection and welfare of workers. The scope of personnel management function was made more broad and liberal. Many provisions regarding recruitment, salary payment and conditions of service were laid down. This gave recognition to the personnel management function in the industrial establishments. Gradually, the need of personnel management and its role in cordial labour relations and fair treatment to employees need were recognized by industrial organizations. Personnel departments under the leadership of personnel managers were started in the companies. Liberal welfare facilities were introduced for the benefit of employees. Such measures taken for the protection and welfare of employees enlarged the scope of personnel management. Even training and manpower development programmes added new dimensions to the activities of personnel management. Many companies have now, prepared well-defined personnel policies, grievance and other procedures and liberal package of welfare facilities. Such additional activities/functions under personnel management raised the importance and popularity of personnel department.

HRM ACTIVITIES/MODEL Explained above in the full length questions DIFFERENCE MANAGEMENT BETWEEN HRM AND PERSONNEL

Explained above in the concept testing question CHALLENGES FACING HRM IN INDIA
With organizations achieving a HRD climate, a basic source of human motivation to perform higher, human wastage has been reduced. So, whereas personnel management regarded wages and salaries as the main source of motivation, Human Resource Management (HRM) regards creation of a congenial work climate (HRD climate), job challenges, creativity and opportunity for development as the motivating forces. 238The challenges in HR that would be very critical are staffing. The biggest fear that such big corporate have is, if two or three wrong people get together, they can bring down the company. So, one is hiring the right kind of people, then right kind of values and the right kind of professional competencies. 239The other challenge is to continuously allow people to develop and grow so that they have very high energy and the ability to energize others with the edge to resolve conflicts, and the ability to execute. You will also have to bear in mind that they also have aspirations. So managing the aspirations and rewarding them timely and accurately become critical in such organizations. 240A lot of companies expect their problems to disappear the moment HR is implemented. "HRM is a means to an end, not the end ". 241The other reasons why HR implementations often fail include lack of preparation, lack of top management involvement, faulty selection process, improper use of the HRM policies/department/funds, too high expectations. 242Cost is an important factor while considering the implementation of HR activities. The companies are trying to cut costs while conducting HR programmes and are exorbitantly spending on other unimportant activities of the organization. 243HRM is still in its stage of infancy, it yet has to evolve and become more a way of doing business or managing the organization.

244It shouldnt be used as a tool or remedial measure when the problem/ crisis arises. 245Nowadays, the employees are being forced to attend self-improvement and overall development programmes compulsorily without the staffs knowledge/interest and companies are spending huge amounts on such welfare activities, which are absolutely redundant and should be eliminated from the system. 246Pay packages and incentives have to be supplemented with some supplementary packages but the company tries to replace the monetary benefits by some workshops or seminars or presentations or training courses which demotivate the workers because their expectations are being ignored in the bargain. We look at the career development of people very strongly. We do not believe that we should What are the challenges facing HRM? / Explain the changing role of HRM? The 1990s have brought a revolutionary change in our business. Post- liberalisation is marked by a shift from command economy to market driven economy; from sheltered market to competitive market; from monopoly to competition; and from domestic trade to global trade. Such a shift calls for a different approach to HR activities. During the preeconomic liberalization, the HR managers had aopted a reactive strategies to peoples problems. The need of the hour is proactive approach, a strategy which helps HR managers foresee events and take appropriate actions before the events occur. The major challenges are: 247Globalisation Globalisation is increasingly viewed as a growth strategy by several companies. Growing internalisation of business has its impact on HRM functions. The HR department is required to cope with the problems of unfamiliar laws, languages, practices, competitions, attitudes, management styles, work ethics and more. HR managers are required to know that international operations have: More functions, such as taxation and co-ordination of departments. More heterogenous functions, such as co-ordination of multiple salary currencies More involvement in the employees personal life, such as housing, health, education and recreation. HR functions such as planning, staffing, remuneration and the like, therefore, will be affected by globalisation. 248Corporate Reorganisations The past three to four years brought us news about corporate mergers, takeovers and massive reorganizations to fend off hostile take-over bids. It is difficult to imagine circumstances that pose a greater challenge for HRM than reorganization resulting from acquisition, merger, divestiture or a take-over threat. The reorganization will have impact on organizational levels and employees. The employees of both the taking over as well as the taken over companies will have anxious moments because of 249Fear of loss of jobs

250Job changes, including new roles and assignments 251Transfers to new geographic location 252Changes in remuneration 253Changes in career possibilities 254Changes in organisational power, status, an prestige, 255Staff changes, including new peers, supervisors, and subordinates, and 256Changes in corporate culture and loss of identity in the company. There is little indication that the pace of mergers and acquisitions will slacken in the future. But an important key to the success of almost any merger or acquisition is the management of HR. 257New organizatioanl forms The practice of HRM is shaped by the organisational forms in which people are employed. But the employment potential of these giant corporations is declining. Large production units have become increasingly a thing of the past, and large companies now tend to consist of business units managed relatively independently. The consequence has been a higher profile of medium size and small sized firms as employers. A majority of the population are employed in units with fewer than 200 employees. This trend affects HRM in various ways Smaller firms and establishments means a more personalised style- not necessarily more progressive, but more fsce-to face. Smaller units may require less complex and sophisticated systems of personnel management, but may also be less able to sustain them in areas like management development. Smaller unit are less able to sustain a specialist personnel management function. On the other hand, the business and human challenges of operating in this kind of environment are becoming greater. The contribution of HRM will then be in facilitating the processes, which support the development of the enterprise, rather than, as traditional personnel management has one, in administering systems for controlling people. The basic challenge to HRM an enterprise management comes from the changing character of competition.Competition in many sectors is no longer between individual firms, large or small, but between constellation of firms. 258Changing demographics of workforce The major challenge that has resulted from changing workforce demographics concerns dual career couples, couples where both partners are actively pursuing professional careers. Organizations have been accustomed to using job moves and physical relocation as an important means of developing talent. The increasing number of dual career professionals limits individual flexibility in accepting such assignments. Another change in the workforce demographics relates to the growing number of employees who are young. Dormitories, gymnasium, breakfast, these are the kind of facilities that need to be provided to the workforce which has more of young employees. 259Changed employee expectations

With changes in work-force demographics, employee expectations and attitudes also have shifted. Traditional allurements such as job security, attractive remuneration,housing and the like do not attract and motivate todays workforce. Employees demand empowerment and expect quality with the management. Previous notions about managerial authority are giving way to employee influence and involvement along with mechanisms for upward communication and due process. Another expectation by the employee is that the electronic and telecommunication revolution will improve the quality of work life. Innovations in communication and computer technology will accelerate the pace of change, and as a result, lead to many innovations in HRM. Also, todays average worker demands better treatment, challenging jobs and career advancement. The HR manager must, therefore, redraw the profile of the worker and discover new methods of hiring, training, remunerating and motivating employees. 260Proactive industrial relations strategy There is almost a metamorphosis at the industrial relations front. Strikes, lockouts and loss of mandays are declining considerably. This transformation is the result of socio-economic and political reasons. The challenge to the labour movement comes not so much from any destructive potential intrinsic in HRM but from its capacity to co-opt and integrate workers into the enterprise by building a relationship with them. Not having to compete with the management for workers loyalty, trade unions behave towards their members exactly as any monopolistic organisation would. HRM comes as a threat to this cosy arrangement, for management is not only seeking to get back to the neglected employee, but doing so in an environment where there own unions had taken them for granted. The need now is to adopt a proactive strategy towards industrial relations, an approach which should enable HR specialists to look into the challenges unfolding in the future and to be prepared to convert them into opportunities. 261Contribution to the success of the Organization The biggest challenge to an HR manager is to make all employees contribute to the success of the organization in an ethical and socially responsible way. The societys well being, to a large extent depends on its organisations, particularly business organisations. It must be the endeavour of everybody to ensure success and stability of organizations. Responsibility is more on the HR manager as it is he who co-ordinates peoples activities and it is the people who make or mar organizations. 262Need for attitudinal change in PSUs While success of organizations in general is vital for societys well being, public sector undertakings tell a different story. It may be asserted that although most PSUs are strong in manpower, R&D, systems, manuals, principles, and procedures, they fail to use it and incur losses. Behind this phenomenon is the role of the personnel. Employees of loss making units have wrong attitudes towards their work and their organizations. Consequences are low

productivity, absenteeism, militancy and other similar evils. These issues must be addressed by the HR manager. 263Renewed focus on people The good news for HR managers is that there is renewed focus on people in organizations. For too long, managers believed in structures, strategies and systems. But over the last decade, technological, competitive and market changes have eroded its effectiveness. The top management must therefore nurture the ideas of the frontline engineers and sales representatives, encourage interpersonal relationship and self monitoring and develop personal communications with key people. The role of HR manager in the unfolding scenario is clear. He or she must make the focus on people justifiable and sustainable. 264Managing the mangers Managing the managers is another challenge before the HR manager. Mangers believe they are a class apart and expect remuneration which may be unreasonable and highly expensive. Managers instead of managing their allotted functions, assume the role of the employer and fire those whom they feel are too smart. Yet, managers are the individuals who run the show and an organisation cannot do without them. 265Protect the interests of weaker sections Another important challenge for HRM is to protect the interest of weaker sections of the society. The dramatic increase of women, minorities and other backward communities in the workforce has resulted in the need for organisations to re-examine their policies, practices and values. 266 267 268be the highest paymasters.

Introduction to Human Resource Management

Introduction - Human resource management (HRM) is a relatively modern label for the range
of themes and practices involved in managing people. It is defined and described in a variety of (sometimes contradictory) ways.
People management

Arguably, HRM has become the dominant approach to people management in English-speaking countries. But it is important to stress that HRM has not 'come out of nowhere'. There is a long history of attempts to achieve an understanding of human behaviour in the workplace. Throughout the 20th century and earlier, practitioners and academics deweloped theories and practices to explain and influence human behaviour at work. HRM has absorbed ideas and techniques from a wide range of these theories and practical tools. In effect, HRM is a synthesis of themes and concepts drawn from a long history of work, more recent management theories and social science research. (...)
Managing Employee Resources
Human Resources Management (HRM) is that branch of management that deals with managing one of the

resources of the organization-Human Resources. It is also called as Personnel Management. However the term Personnel Management is being replaced in most spheres by the term Human Resource Management or Human Resource Development (HRD) or simply Human Resources (HR). In our text we shall be using these terms interchangeably. Most organizations have a full-fledged Human Resource Management department. The function of Human Resource Management is to acquire, train, develop and retain the human resources of the organization so that with the help of these human resources, the organization is able to achieve its goal.

Broadly the activities carried out by Human Resource Management are Manpower Planning Recruitment and Selection Induction of the New employees Performance Appraisal Organization Development Training and Development Employee Counseling Compensation Planning Industrial Relations Employee separation

Since Human Resource Management has such a wide berth, defining it is quite a task. One good definition of Human Resource Management is given by the UK based Institute of Personnel and Development, which defines it as: "Recruiting and selecting people, training and developing them for their work, ensuring that payment and conditions of employment are appropriate, where necessary negotiating such terms of employment with trade unions, advising on healthy and appropriate working conditions, the organization of people at work, and the encouragement of relations between management and work people."

Relation between Human Resources and management:

Human Resource Management is an integral part of management. It helps the management in taking a strategic view of a very important resource i.e. Human Resource. It helps management in identifying key skill sets, knowledge, values required in the employee and the rewards that are needed to be given to the employees so that the organisation goals are fulfilled. Also like other management functions, it has to ensure that these resources are available at an optimal cost. It has to look into various training and development activities to ensure this. This is a key area for Human Resource Management as it shows their contribution in terms of money. The money here would be the opportunity cost incurred due to appointing of new employees instead of developing current employees for the task in hand. The HR manager has a dual role in the organisation. He performs the role of an executive as well as a consultant. Managing people is not only a HR area but also part of the job of line managers. These managers are managers heading various activities like accounts, audit, production, marketing, sales etc. They have people working under them and have to manage them too. There are times when line managers have problems handling employees and are unable to resolve the issue. This is where the HR person steps in as a consultant. The HR person can provide advice to the line manager to tackle the situation. This is in addition to the executive role he performs. The executive role of the HR person is his role in carrying out the

routine activities of his area. There are occasions when they have to on both the hats of an executive as well as that of a consultant. A typical example is the role of the HR person when recruiting people for line functions, where line managers decide as they have the expertise, they help the line managers with advice while simultaneously carrying out their executive role of recruiting.

Human Resource Management Introduction Human resource (or personnel) management, in the sense of getting things done through people, is an essential part of every manager's responsibilities, but many organizations find it advantageous to establish a specialist division to provide an expert service dedicated to ensuring that the human resource function is performed efficiently. "People are our most valuable asset" is a clich which no member of any senior management team would disagree with. Yet, the reality for many organizations is that their people remain under valued, under trained and under utilized. The rate of change facing organizations has never been greater and organizations must absorb and manage change at a much faster rate than in the past. In order to implement a successful business strategy to face this challenge, organizations, large or small, must ensure that they have the right people capable of delivering the strategy. The market place for talented, skilled people is competitive and expensive. Taking on new staff can be disruptive to existing employees. Also, it takes time to develop 'cultural awareness', product/ process/ organization knowledge and experience for new staff members. As organizations vary in size, aims, functions, complexity, construction, the physical nature of their product, and appeal as employers, so do the contributions of human resource management. But, in most the ultimate aim of the function is to: "ensure that at all times the business is correctly staffed by the right number of people with the skills relevant to the business needs", that is, neither overstaffed nor understaffed in total or in respect of any one discipline or work grade. Function 1 | Manpower planning The penalties for not being correctly staffed are costly. Understaffing loses the business economies of scale and specialization, orders, customers and profits. Overstaffing is wasteful and expensive, if sustained, and it is costly to eliminate because of modern legislation in respect of redundancy payments, consultation, minimum periods of notice, etc. Very importantly, overstaffing reduces the competitive efficiency of the business. Staffing level planning requires that an assessment of present and future needs of the organization be compared with present resources and future predicted resources. Appropriate steps then be planned to bring demand and supply into balance. Thus the first step is to take a 'satellite picture' of the existing workforce profile (numbers, skills, ages, flexibility, sex, experience, forecast capabilities, character, potential, etc. of existing employees) and then to adjust this for 1, 3 and 10 years ahead by amendments for normal turnover, planned staff movements, retirements, etc, in line with the business plan for the corresponding time frames. The result should be a series of crude supply situations as would be the outcome of present planning if left unmodified. (This, clearly, requires a great deal of information accretion, classification and statistical analysis as a subsidiary aspect of personnel management.) What future demands will be is only influenced in part by the forecast of the personnel manager, whose main task may well be to scrutinize and modify the crude predictions of other managers. Future staffing needs will derive from: Sales and production forecasts

The effects of technological change on task needs Variations in the efficiency, productivity, flexibility of labor as a result of training, work study, organizational change, new motivations, etc. Changes in employment practices (e.g. use of subcontractors or agency staffs, hiving-off tasks, buying in, substitution, etc.) Variations, which respond to new legislation, e.g. payroll taxes or their abolition, new health and safety requirements Changes in Government policies (investment incentives, regional or trade grants, etc.)

What should emerge from this 'blue sky gazing' is a 'thought out' and logical staffing demand schedule for varying dates in the future which can then be compared with the crude supply schedules. The comparisons will then indicate what steps must be taken to achieve a balance. That, in turn, will involve the further planning of such recruitment, training, retraining, labor reductions (early retirement/redundancy) or changes in workforce utilization as will bring supply and demand into equilibrium, not just as a oneoff but as a continuing workforce planning exercise the inputs to which will need constant varying to reflect 'actual' as against predicted experience on the supply side and changes in production actually achieved as against forecast on the demand side. HR Function 2 | Recruitment and selection of employees Recruitment of staff should be preceded by: An analysis of the job to be done (i.e. an analytical study of the tasks to be performed to determine their essential factors) written into a job description so that the selectors know what physical and mental characteristics applicants must possess, what qualities and attitudes are desirable and what characteristics are a decided disadvantage; In the case of replacement staff a critical questioning of the need to recruit at all (replacement should rarely be an automatic process). Effectively, selection is 'buying' an employee (the price being the wage or salary multiplied by probable years of service) hence bad buys can be very expensive. For that reason some firms (and some firms for particular jobs) use external expert consultants for recruitment and selection. Equally some small organizations exist to 'head hunt', i.e. to attract staff with high reputations from existing employers to the recruiting employer. However, the 'cost' of poor selection is such that, even for the mundane day-to-day jobs, those who recruit and select should be well trained to judge the suitability of applicants.

The main sources of recruitment are: Internal promotion and internal introductions (at times desirable for morale purposes) Careers officers (and careers masters at schools) University appointment boards Agencies for the unemployed Advertising (often via agents for specialist posts) or the use of other local media (e.g. commercial radio)

Where the organization does its own printed advertising it is useful if it has some identifying logo as its trade mark for rapid attraction and it must take care not to offend the sex, race, etc. antidiscrimination

legislation either directly or indirectly. The form on which the applicant is to apply (personal appearance, letter of application, completion of a form) will vary according to the posts vacant and numbers to be recruited. It is very desirable in many jobs that claim about experience and statements about qualifications are thoroughly checked and that applicants unfailingly complete a health questionnaire (the latter is not necessarily injurious to the applicants chance of being appointed as firms are required to employ a percentage of disabled people). Before letters of appointment are sent any doubts about medical fitness or capacity (in employments where hygiene considerations are dominant) should be resolved by requiring applicants to attend a medical examination. This is especially so where, as for example in the case of apprentices, the recruitment is for a contractual period or involves the firm in training costs. Interviewing can be carried out by individuals (e.g. supervisor or departmental manager), by panels of interviewers or in the form of sequential interviews by different experts and can vary from a five minute 'chat' to a process of several days. Ultimately personal skills in judgment are probably the most important, but techniques to aid judgment include selection testing for: Aptitudes (particularly useful for school leavers) Attainments General intelligence

(All of these need skilled testing and assessment.) In more senior posts other techniques are: Leaderless groups Command exercises Group problem solving

(These are some common techniques - professional selection organizations often use other techniques to aid in selection.) Training in interviewing and in appraising candidates is clearly essential to good recruitment. Largely the former consists of teaching interviewers how to draw out the interviewee and the latter how to xratex the candidates. For consistency (and as an aid to checking that) rating often consists of scoring candidates for experience, knowledge, physical/mental capabilities, intellectual levels, motivation, prospective potential, leadership abilities etc. (according to the needs of the post). Application of the normal curve of distribution to scoring eliminates freak judgments. Function 3 | Employee motivation To retain good staff and to encourage them to give of their best while at work requires attention to the financial and psychological and even physiological rewards offered by the organization as a continuous exercise. Basic financial rewards and conditions of service (e.g. working hours per week) are determined externally (by national bargaining or government minimum wage legislation) in many occupations but as much as 50 per cent of the gross pay of manual workers is often the result of local negotiations and details (e.g. which particular hours shall be worked) of conditions of service are often more important than the basics. Hence there is scope for financial and other motivations to be used at local levels. As staffing needs will vary with the productivity of the workforce (and the industrial peace achieved) so good personnel policies are desirable. The latter can depend upon other factors (like environment, welfare, employee benefits, etc.) but unless the wage packet is accepted as 'fair and just' there will be no motivation.

Hence while the technicalities of payment and other systems may be the concern of others, the outcome of them is a matter of great concern to human resource management. Increasingly the influences of behavioral science discoveries are becoming important not merely because of the widely-acknowledged limitations of money as a motivator, but because of the changing mix and nature of tasks (e.g. more service and professional jobs and far fewer unskilled and repetitive production jobs). The former demand better-educated, mobile and multi-skilled employees much more likely to be influenced by things like job satisfaction, involvement, participation, etc. than the economically dependent employees of yesteryear. Hence human resource management must act as a source of information about and a source of inspiration for the application of the findings of behavioral science. It may be a matter of drawing the attention of senior managers to what is being achieved elsewhere and the gradual education of middle managers to new points of view on job design, work organization and worker autonomy. Function 4| Employee evaluation An organization needs constantly to take stock of its workforce and to assess its performance in existing jobs for three reasons: To improve organizational performance via improving the performance of individual contributors (should be an automatic process in the case of good managers, but (about annually) two key questions should be posed: o o what has been done to improve the performance of a person last year? and what can be done to improve his or her performance in the year to come?).

To identify potential, i.e. to recognize existing talent and to use that to fill vacancies higher in the organization or to transfer individuals into jobs where better use can be made of their abilities or developing skills. To provide an equitable method of linking payment to performance where there are no numerical criteria (often this salary performance review takes place about three months later and is kept quite separate from 1. and 2. but is based on the same assessment).

On-the-spot managers and supervisors, not HR staffs, carry out evaluations. The personnel role is usually that of: Advising top management of the principles and objectives of an evaluation system and designing it for particular organizations and environments. Developing systems appropriately in consultation with managers, supervisors and staff representatives. Securing the involvement and cooperation of appraisers and those to be appraised. Assistance in the setting of objective standards of evaluation / assessment, for example: o o o o Defining targets for achievement; Explaining how to quantify and agree objectives; Introducing self-assessment; Eliminating complexity and duplication.

Publicizing the purposes of the exercise and explaining to staff how the system will be used.

Organizing and establishing the necessary training of managers and supervisors who will carry out the actual evaluations/ appraisals. Not only training in principles and procedures but also in the human relations skills necessary. (Lack of confidence in their own ability to handle situations of poor performance is the main weakness of assessors.) Monitoring the scheme - ensuring it does not fall into disuse, following up on training/job exchange etc. recommendations, reminding managers of their responsibilities.

Full-scale periodic reviews should be a standard feature of schemes since resistance to evaluation / appraisal schemes is common and the temptation to water down or render schemes ineffectual is ever present (managers resent the time taken if nothing else). Basically an evaluation / appraisal scheme is a formalization of what is done in a more casual manner anyway (e.g. if there is a vacancy, discussion about internal moves and internal attempts to put square pegs into 'squarer holes' are both the results of casual evaluation). Most managers approve merit payment and that too calls for evaluation. Made a standard routine task, it aids the development of talent, warns the inefficient or uncaring and can be an effective form of motivation. Function 5| Industrial relations Good industrial relations, while a recognizable and legitimate objective for an organization, are difficult to define since a good system of industrial relations involves complex relationships between: (a) Workers (and their informal and formal groups, i. e. trade union, organizations and their representatives); (b) Employers (and their managers and formal organizations like trade and professional associations); (c) The government and legislation and government agencies l and 'independent' agencies like the Advisory Conciliation and Arbitration Service. Oversimplified, work is a matter of managers giving instructions and workers following them - but (and even under slavery we recognize that different 'managing' produces very different results) the variety of 'forms' which have evolved to regulate the conduct of parties (i.e. laws, custom and practice, observances, agreements) makes the giving and receipt of instructions far from simple. Two types of 'rule' have evolved: 'Substantive', determining basic pay and conditions of service (what rewards workers should receive); 'Procedural,' determining how workers should be treated and methods and procedures.

Determining these rules are many common sense matters like: Financial, policy and market constraints on the parties (e.g. some unions do not have the finance to support industrial action, some have policies not to strike, some employers are more vulnerable than others to industrial action, some will not make changes unless worker agreement is made first, and rewards always ultimately reflect what the market will bear); the technology of production (the effect of a strike in newspaper production is immediate -it may be months before becoming effective in shipbuilding); the distribution of power within the community - that tends to vary over time and with economic conditions workers (or unions) dominating in times of full employment and employers in times of recession. Broadly in the Western style economies the parties (workers and employers) are free to make their own agreements and rules. This is called 'voluntarism'. But it does not mean there is total noninterference by the government. That is necessary to:

Protect the weak (hence minimum wage); Outlaw discrimination (race or sex); Determine minimum standards of safety, health, hygiene and even important conditions of service; To try to prevent the abuse of power by either party.

The personnel manager's involvement in the system of industrial relations varies from organization to organization, but normally he or she is required to provide seven identifiable functions, thus: 1. To keep abreast of industrial law (legislation and precedents) and to advise managers about their responsibilities e.g. to observe requirements in respect of employing disabled persons, not to discriminate, not to disclose 'spent' convictions of employees, to observe codes of practice etc. in relation to discipline and redundancy, and similarly to determine organizational policies (in conjunction with other managers) relevant to legal and moral requirements (see also 4.). 2. To conduct (or assist in the conduct) of either local negotiations (within the plant) or similarly to act as the employer's representative in national negotiations. This could be as a critic or advisor in respect of trade etc. association policies or as a member of a trade association negotiating team. Agreements could be in respect of substantive or procedural matters. Even if not directly involved the personnel manager will advise other managers and administrators of the outcome of negotiations. 3. To ensure that agreements reached are interpreted so as to make sense to those who must operate them at the appropriate level within the organization (this can involve a lot of new learning at supervisory level and new pay procedures and new recording requirements in administration and even the teaching of new employment concepts like stagger systems of work - at management level). 4. To monitor the observance of agreements and to produce policies that ensure that agreements are followed within the organization. An example would be the policy to be followed on the appointment of a new but experienced recruit in relation to the offered salary where there is a choice of increments to be given for experience, ability or qualification. 5. To correct the situations which go wrong. 'Face' is of some importance in most organizations and operating at a 'remote' staff level personnel managers can correct industrial relations errors made at local level without occasioning any loss of dignity (face) at the working level. 'Human resource management' and the obscurity of its reasoning can be blamed for matters which go wrong at plant level and for unwelcome changes, variations of comfortable 'arrangements' and practices and unpopular interpretation of agreements. 6. To provide the impetus (and often devise the machinery) for the introduction of joint consultation and worker participation in decision-making in the organization. Formal agreement in respect of working conditions and behavior could never cover every situation likely to arise. Moreover the more demanding the task (in terms of the mental contribution by the worker to its completion) the more highlyeducated the workers need to be and the more they will want to be consulted about and involved in the details of work life. Matters like the rules for a flextime system or for determining the correction of absenteeism and the contents of jobs are three examples of the sort of matters that may be solely decided by management in some organizations but a matter for joint consultation (not negotiation) in others with a more twenty-firstcentury outlook and philosophy. Human resource management is very involved in promoting and originating ideas in this field. 7. To provide statistics and information about workforce numbers, costs, skills etc. as relevant to negotiations (i.e. the cost of pay rises or compromise proposals, effect on differentials and possible recruitment/retention consequences of this or whether agreement needs to be known instantly); to maintain personnel records of training, experience, achievements, qualifications, awards and possibly pension and other records; to produce data of interest to management in respect of personnel matters like absentee figures and costs, statistics of sickness absence, costs of welfare and other employee services, statements

about development in policies by other organizations, ideas for innovations; to advise upon or operate directly, grievance, redundancy, disciplinary and other procedures. Function 6 | Provision of employee services Attention to the mental and physical well-being of employees is normal in many organizations as a means of keeping good staff and attracting others. The forms this welfare can take are many and varied, from loans to the needy to counseling in respect of personal problems. Among the activities regarded as normal are: Schemes for occupational sick pay, extended sick leave and access to the firm's medical adviser; Schemes for bereavement or other special leave; The rehabilitation of injured/unfit/ disabled employees and temporary or permanent move to lighter work; The maintenance of disablement statistics and registers (there are complicated legal requirements in respect of quotas of disabled workers and a need for 'certificates' where quota are not fulfilled and recruitment must take place); Provision of financial and other support for sports, social, hobbies, activities of many kinds which are work related; Provision of canteens and other catering facilities; Possibly assistance with financial and other aid to employees in difficulty (supervision, maybe, of an employee managed benevolent fund or scheme); Provision of information handbooks, Running of pre-retirement courses and similar fringe activities; Care for the welfare aspects of health and safety legislation and provision of first-aid training.

The location of the health and safety function within the organization varies. Commonly a split of responsibilities exists under which 'production' or 'engineering' management cares for the provision of safe systems of work and safe places and machines etc., but HRM is responsible for administration, training and education in awareness and understanding of the law, and for the alerting of all levels to new requirements. Function 7 | Employee education, training and development In general, education is 'mind preparation' and is carried out remote from the actual work area, training is the systematic development of the attitude, knowledge, skill pattern required by a person to perform a given task or job adequately and development is 'the growth of the individual in terms of ability, understanding and awareness'. Within an organization all three are necessary in order to: Develop workers to undertake higher-grade tasks; Provide the conventional training of new and young workers (e.g. as apprentices, clerks, etc.); Raise efficiency and standards of performance; Meet legislative requirements (e.g. health and safety); Inform people (induction training, pre-retirement courses, etc.);

From time to time meet special needs arising from technical, legislative, and knowledge need changes. Meeting these needs is achieved via the 'training loop'. (Schematic available in PDF version.) The diagnosis of other than conventional needs is complex and often depends upon the intuition or personal experience of managers and needs revealed by deficiencies. Sources of inspiration include: Common sense - it is often obvious that new machines, work systems, task requirements and changes in job content will require workers to be prepared; Shortcomings revealed by statistics of output per head, performance indices, unit costs, etc. and behavioral failures revealed by absentee figures, lateness, sickness etc. records; Recommendations of government and industry training organizations; Inspiration and innovations of individual managers and supervisors; Forecasts and predictions about staffing needs; Inspirations prompted by the technical press, training journals, reports of the experience of others; The suggestions made by specialist (e.g. education and training officers, safety engineers, workstudy staff and management services personnel).

Designing training is far more than devising courses; it can include activities such as: Learning from observation of trained workers; Receiving coaching from seniors; Discovery as the result of working party, project team membership or attendance at meetings; Job swaps within and without the organization; Undertaking planned reading, or follow from the use of selfteaching texts and video tapes; Learning via involvement in research, report writing and visiting other works or organizations.

So far as group training is concerned in addition to formal courses there are: Lectures and talks by senior or specialist managers; Discussion group (conference and meeting) activities; Briefing by senior staffs; Role-playing exercises and simulation of actual conditions; Video and computer teaching activities; Case studies (and discussion) tests, quizzes, panel 'games', group forums, observation exercises and inspection and reporting techniques.

Evaluation of the effectiveness of training is done to ensure that it is cost effective, to identify needs to modify or extend what is being provided, to reveal new needs and redefine priorities and most of all to ensure that the objectives of the training are being met. The latter may not be easy to ascertain where results cannot be measured mathematically. In the case of

attitude and behavioral changes sought, leadership abilities, drive and ambition fostered, etc., achievement is a matter of the judgment of senior staffs. Exact validation might be impossible but unless on the whole the judgments are favorable the cooperation of managers in identifying needs, releasing personnel and assisting in training ventures will cease. In making their judgments senior managers will question whether the efforts expended have produced: More effective, efficient, flexible employees; Faster results in making newcomers knowledgeable and effective than would follow from experience; More effective or efficient use of machinery, equipment and work procedures; Fewer requirements to implement redundancy (by retraining); Fewer accidents both personal and to property; Improvements in the qualifications of staff and their ability to take on tougher roles; Better employee loyalty to the organization with more willingness to innovate and accept change.

Evolution of HRM in India Indias huge population provides it with a critical competitive advantage during a period of increasing concerns regarding an aging workforce in the developed world and talent shortages globally. In this global context, India can consider itself relatively lucky. Just 7 percent of Indians are above the age of 60. In 25 years time only 12 percent will be above 60. India will continue to be young and will see a swelling workforce of scientific, technical, and professional talent. Despite this seeming competitive advantage, the fact is that due to its late start on the road to development and a strong history of union activity, India has traditionally lagged in the systematic development of highquality talent. There have been a lot of talented professionals around, but Indian organizations have only in the past few decades engaged in a focused effort to develop their talent pool. In the first 40 years after Indian independence, slow economic growth rates, militant unionism, the protected nature of the Indian economy (and correspondingly limited concern with employee productivity) as well the dominance of public-sector enterprises in key industrial sectors meant that companies did not view HRM as a key business imperative. Opportunities in the private sector for ambitious and talented people were limited and employee mobility was low.

We can focus on five broad themes that typify the nature of the HRM challenges in India. 1. No longer a recruiter's market Individuals scouring for job opportunities in the market have many more choices today. The changed dynamics in the recruitment market impacts on the retention strategies within organizations as well the usual tactics of paying above the market or high-impact roles may not work anymore. 2. Focus on efficiency Recent trends have shown an increasing tendency to restructure workforces, downsize, outsource, and automate. This has happened with the enhanced use of outsourcing and technology solutions to transform the transactional nature of the HRM function. In todays changing context, HR professionals are being challenged to show results and deliver tangible value.

3. A new employee relations environment In recent years trade unions have been reluctant to call for strikes because they are afraid that a strike may lead to the closure of the unit. Service sector workers feel they have become outsiders and are becoming increasingly disinterested in trade union activities. Instead of demanding higher wages, allowances, or facilities, trade unions now demand job security and some are even willing to accept wage cuts or wage freezes in return for job protection. 4. The emergence of Global Indian companies The liberalization process not only opened India to the globe, but also allowed leading Indian organizations to arrive on the global stage. While Infosys, Wipro, and TCS are prominent names in the IT industry globally, large multi-business houses such as Reliance, Tata Sons, and the AV Birla Group are also actively operating overseas. The challenge of managing diversity on a global scale will be a new one for Indian business leaders and HRM professionals. The demand for skills that can effectively integrate cultures, manage diversity, initiate communication mechanisms across time zones, and still maintain a core of consistent organizational values will be of premium. 5. The search for new paradigms As a large majority of cutting-edge research and practices in the area of management thinking (including HRM) has been in the West, more specifically in the United States, what is the level of fit with the realities of different cultures? Local adaptations of global HRM initiatives have been very successful in some case, but not in others. As far as the fit of these concepts and frameworks to an Indian context is concerned, the jury is still out.

In many ways, the growth and evolution of the HRM agenda is reflective of the changed socioeconomic realities in post-liberalization India. While great strides have been taken in enhancing human capital productivity and Indian talent is gaining recognition globally, there are vast gaps to be bridged before we can truly talk of a transformation in the talent market. This veritable race against time to build on existing strengths and cover the major weaknesses will engage business and HRM leaders of India in the foreseeable future. Changing Roles and Myth about HRM
The Foremost and prime HR function in any organization is recruiting the right person and then getting requisite quality and quantity of work (Read productivity) for a reasonable period of tenure, in line with organizational goals (Do most of organizations and the top HR Bosses themselves know about it?). One can call it Strategic Human Resource Management, which uses various tools and techniques for motivation, appraisal, training, cross cultural management, emerging issues in personnel laws like, sexual harassment and competence mapping, etc. In fact HR function is main responsibility of a supervisor and not of a HR Department, and higher goes the role and scope of responsibilities, higher the supervisor in Organization Hierarchy. In many organizations, for instance, IT industry, one has very loose or flattish hierarchy due to knowledge workers outfit. Over the decades HRM became a separated out function graduating from a simple Time Office function to a high profile Division in organizations until recently when most of HRM functions have been leased out (Outsourced) and what is left with HR departments is Planning and Strategy. But unfortunately the supervisors have abandoned their prime responsibility to manage men and think that this better be taken care of by HR Specialists. This is simply a myth. Increasing globalization and migration of labor in both directions like the financial capital, the challenges of staffing, retention and motivation of highly skilled workers from wider canvass and background and even education background, is really serious issue that better be not ignored by

Businesses. My experience in Corporate sector in India in various types of organizations ranging from Steels to Textiles, Chemicals and Services sector has been quite amusing and educative as far as the way HR has been handled by various types of entrepreneurs in India right from SBEs to the so called Large corporate units. Majority of Indian businesses still treat employees as commodities and expect them to come trained and skilled in specific areas they are hired for (Even in US it is not feasible despite Industry Institutes interface). Hire and fire has been very popular policy in India and suppressing welfare laws regarding labor has been a favorable pass time, and matter of satisfaction & pride for Indian Businessmen. It was often observed by me that rapid expansion of businesses were scarcely accompanied by timely organizational structuring, expansion, training and growth in pace with such expansions and thus most of such expansions fell flat, even destroying their existing business lines and profitability. The problem with HRM is that one cannot use clear cut formula that can be applied in particular situations due to highly subjective, emotional and cultural deviation amongst the employees. Secondly skilled and committed workers will become more and more scarce commodity due to rapid global expansion of business, high aspiration levels, fast growth mentality of youth including job-hopping, mobility of labor across borders and rapidly changing technologies. This is just too much to handle for traditional HR experts and involvement of Top line functional supervisors is essential for strategic growth of organizations. Indian businesses have a soft belly there due to still continuing contemptuous and casual attitude towards employees. As we move from Time Office to Personnel Management and on to HR Management to Human Asset management to Intellectual Capital paradigms, drastic changes in HR practices and HR organizations in Businesses is inevitable. Another thing to understand is that there is not very strong correlation between wages & incentives and motivation level of employees as is generally thought. Motivation and stability of employees is rather complicated task determined by several volatile factors, for instance, cultural background, family unit, education level and type, age, job satisfaction and so many others still not fully understood. It is another myth of HRM that giving doses of some foreign trip and 50 or 100 hrs of boring and stereotyped training sessions (requirement of TQM, ISO 9000 also) will raise motivation, skills and work style standards of employee. Most important change required is commitment, interest and achievement motivation within framework of organizational goals. One thing is very clear from above discussions that Quality and stability of Employees in organizations is going to be key differentiator and even main foundation for survival of a business in coming times and that too in highly nebulous environment of labor markets. The third Myth worth mentioning is that employees always work better by giving better facilities, rewards and training sessions. I have found it to be doubtful in most situations. In fact the best way to train and induce employee to work and achieve higher is to create slight stress in work environment and little bit of job in security. As they say, throw the child in waters and it will pick swimming faster- very well applies to all human activities. There is no substitute for experience gained repeatedly by varied situations of decision-making and it is really confounding as to why inexperienced graduates from B-schools colleges are paid unreasonably high wages. Some one may like to deeply probe the issue whether such high remunerations are really effective in extraordinary achievements of organizations? One of the main reason for rise in corruption and materialistic pursuit by public sector employees is envy towards unusually high wage rates in so called hi-fi and MNC organizations around the globe, particularly in countries like India that are having poor quality of Public Administration, public awareness and legal systems.

We can see that there is acute crisis facing the HR Managers who are yet to get their own roles re-defined and who have to find or create leaders in multi cultural setting in a highly competitive business environment and tight job market, with very high attrition rates in some sectors, like in Call Centers and software industries, and developing requisite inner motivation levels and soft skills that are often neglected in promotions and wage fixations (Here 'wage' is being used as a generic term for all kinds of compensation structures at all levels). While loyalty can be developed and maintained in employees, I would like to explode fourth Myth in HRM by revealing the fact that loyalty also has frequently roots in ethical, community and genetic background (We may call these attitudes, or inherent attitudes or life positions taken by an employee during initial grooming in young age). There is need to develop yet more effective psychometric tests or procedures to sift the candidates for right combination of IQ, EQ and loyalty index (I would like to find a formula for this term). One big damage globalization has done is to popularize the western materialistic high-growth rate focused employee culture prevalent in US where employees have little emotional concern with organizations they work (Even Japan is fast becoming victim to this epidemic!). Another challenge facing Organizations is to handle legal pressures relating to employee related laws of newer types like gender bias, racial or caste bias in employment, sexual harassment (At least two very senior officials of Indian Organizations have already been charges or accused of this in USA), ethical issues in handling organization information and challenges of multi-ethnic or multi-cultural staffed work places. Work place diversity is a good major of challenge in Organizations. This will grow in near future. According to Thomas (1992), dimensions of workplace diversity include, but are not limited to: age, ethnicity, ancestry, gender, physical abilities/qualities, race, sexual orientation, educational background, geographic location, income, marital status, military experience, religious beliefs, parental status, and work experience. The future success of any organizations relies on the ability to manage a diverse body of talent that can bring innovative ideas, perspectives and views to their work. The challenge and problems faced of workplace diversity can be turned into a strategic organizational asset if an organization is able to capitalize on this melting pot of diverse talents. With the mixture of talents of diverse cultural backgrounds, genders, ages and lifestyles, an organization can respond to business opportunities more rapidly and creatively, especially in the global arena (Cox, 1993), which must be one of the important organizational goals to be attained. A key issue that influences success in international arena is the awareness of cultural differences and thus development of both a business strategy and corresponding HR strategy that is consistent with the culture of host country. The interface between culture of the organization and culture of host country become important. Instead of leaving these issues to be tackled by HR personnel, the senior executives in international business arena have to take the HR strategies and solutions in their own hands. More and more informational technology is being used in organizations to deliver HR services (Example HRSC of IBM) and a good part of these are being outsourced. This is natural outcome in changing business environment and brings in both advantages of expertise and economics. Large organizations otherwise also cannot cope with information exchange requirements in huge staffed organization in traditional manner unless they follow IBM like I initiatives. The example of IBM HRSC is an attempt to combine people, technology and customer service, much as it does with its external customers. The center service about 20 business units in areas including benefits, retirement planning, compensation, employee suggestions, staffing, job posting, orientation, performance management, EEO compliance, employee separations, leave of absence, and skill development through 80 customer service representatives. This will be more or less true for all leading organizations in services sector in particular in near future. IBM too had repositioned itself as service driven organization. Impact of technology can be viewed as challenges in:

- Necessary expansion/contraction of work force. - Training needed to utilize new technology (A major reason of failures in Indian Small & mid size organizations from 80s to end of 90s) - Effective change Management - Impact on work group dynamics and concept of human face - Costs for hiring, severance, training. - Unwillingness of entrepreneurs to understand, recognize and adopt technology that can drive productivity, quality, customer satisfaction and new market opportunities. - Sliming down of organizations particularly at lower levels and reduced hierarchy. Another Myth of US based HR Practices is non-relevance of old employees or problem of graying workforce. The reason could be higher health care costs and perception of lower productivity. This may be true, but not in all circumstances. The element of loyalty may weigh favorably in favor of older employees as also their vast experience particularly useful in handling crises and negotiations, grievance handling within and outside organizations and networking advantage. I strongly decry the US corporate culture largely derived from social attitudes towards old in devaluing them .One serious disadvantage of old employees is their resistance to change in practices and call of business environment changes. As supply of baby boomers exceeds the demand, HR challenge is to handle this tricky issue including retirement and retraining or rehabilitation plan. US culture simply does not suit Indian culture and ethos and we should not blindly go for US system. HRM will not have to deal only with cultural diversity of employees and organization but also issues of minorities, backward classes and racial preferences in employment. Neither many-grounded theories are available in HR, nor the traditional HR practices will apply to most of organizational settings in coming times.

sTraditional HR Versus Strategic HR (From chapter 4, PP 101-102, Jeffrey A Mello 2) Indicator Responsibility for HR Focus Role of HR Initiatives Time Horizon Control Traditional HR Staff Specialists Employee Relations Transactional, Change follower and respondent Slow, reactive and fragmented Short-term Bureaucratic-roles, policies, procedures Strategic HR Line Managers Partnership with internal and external customers Transformational, change leader and initiator Fast, proactive and integrated Short, medium, Long (as necessary) Organic-Flexible, whatever is necessary to succeed

Job design Key investments Accountability

Tight division of labor, independence, specialization Capital, Products Cost center

Broad, flexible, cross training, teams People, knowledge Investment center

The traditional HR assumes a role of handling transaction as they arise. In India in most of organizations that are still bossed by 60+ adults from orthodox family business background (Babu ji culture), the role of HR personnel is not understood by them and they mostly serve as front for the CEO's decisions ranging from hiring, firing, wages, promotions and all kinds of manipulations. The traditional HR itself branched out as scientific division of labor relieving line managers from highly subjective, time consuming and inconvenient activities related to employee and which were not considered crucial to profit making and growth of organization. Strategic HR plays role of transformational change agent with focus on and in line with long term or strategic goals of organization. To become strategic the HR managers will have to be drawn from general Management rather than specialist training background, have to adopt long term and strategic focus and persuade management to look beyond current performance. Further, most of senior executives including entrepreneurs themselves hardly appreciative benefits and possibility of HRM as strategic partner. In fact most managers view HR with dislike being rule machines that hinder flexibility and carrying out of jobs. It is surprising but true that most senior executives in India as well as owners view human assets as liability and not owned by them and therefore a high-risk investment. HR activities in organizations are mostly taken up to do face lifting and present modernized face of organization because the direct benefits of HR are difficult to see and quantify. The HR and training budgets get axe first when need arises to do so. References: 1. The challenges of Human Resource Management-Dr Alvin Chan-www.Zeromillion.com/business/hrm 2. Strategic Human resource Management- Jeffrey A. Mello, Thomson South Western 2004 3. "Technology, Diversity and Work Culture-Key trends in next Millennium" Harvey B H; HR Magazine 45, (7) July 2000 p 59 4. 'How will the new technology change the HR Profession?'-Workplace Visions, Society for Human resource Management, No 3, 2000.

UNIT-1 INTRODUCTION TO HUMAN RESOURCES MANAGEMENT

When Is An HR Department Necessary?
How many employees should a company have before there is a need for an HR Department? As companies grow, there is a need to administer the HR function, but that doesn't necessitate an HR Department. In fact, 30 years experience has shown that until the company has at least 50 employees, that "department" -- really a function -- can consist of or be handled by one person...often much to the dismay of that one person. Between outsourcing such things as payroll and the initial writing of an employee handbook, and with the plethora of software for HR today, one person should be able to develop and administer the function. Of course, there are variations to this theme. In some companies where recruiting has been a major activity, there may well be a need to have an HR administrator or "Benefits Clerk" and a recruiter. But in most small companies an Office Manager can suffice. Historically, what necessitates an HR Department are the functions and responsibilities which no one else either wants or is capable of doing. From recruiting to orienting new employees, from writing job descriptions to tracking attendance, and from instituting and monitoring policies to monitoring benefits, there has been a need for an HR generalist to assist senior management in

both establishing a structure to holding down costs of administration. In fact, I have felt for some time that the initial title for the HR person should be "Administrative Manager." Let's say that you have been hired or requested to establish an HR function. What do you need to do? The first step is to determine what the expectations are of the manager who realized the necessity of the function. In very small companies, this is often the owner or most senior manager who just returned from a seminar or workshop where an attorney -- or a whole herd of attorneys -- has scared the hell out of him or her by pointing out the complexities of complying with federal and state labor codes. Using some of the responsibilities listed below, develop a job description with that manager which at least outlines what the job entails. After that, determine the compliance issues which pertain to your company. The most basic of these have to do with wages and hours of work, classification of employees, the I-9, COBRA (down from 20 to two employees in California and New Jersey, by the way), leaves of absence including maternity and family leaves which differ from state to state, ADA, harassment, and a host of others. (Charts and attendant articles - including a 2005 job description - are found only in the subscriber's section.) Then, determine whether or not you need to have an employee handbook or other formal policies and procedures manual to cover everything from establishing the company as an at-will employer to benefits. If a handbook already exists, be certain that it is in compliance with federal and state regulations and that the policies and the way they are written are in the best interests of the company. Are all the basic policies included? These can be thought of as grouped into conditions of employment, benefits, and disciplinary processes. Is there a balance between stated corporate and employee rights and obligations? Take a look at existing employee files or, if no files exist, gathering all the papers into coherent personnel files. Minimally, you should have an Application for Employment form or resume, a W-2, any insurance forms that the employee may have signed, and performance appraisals. I also like to see start dates, dates of reviews, dates of promotions, and all the changes in wages or salary. Because personnel still runs on paper and paperwork, do not rely too heavily on computerized files. (Besides, such files seem to disappear with regularity nowadays.) Who takes care of payroll? There used to be an ongoing fight between HR and accounting as to who gets payroll. I have no idea why anyone would want it and it does belong in accounting more so than in HR but, should the question arise, the answer today is to outsource payroll to a payroll service (or a bank which offers such a service). There are still responsibilities such as informing the payroll service of changes in individual wages or salaries, docking, and final pay, but payroll services are definitely the way to go. They do vary in quality and quantity of services, so you will have to compare. Do not let a payroll service sell you more than what you need...which means that you'll have to do some research into what you need. Benefits administration is and should be separate from payroll. Even if you have the best broker in the world (who you only have to monitor on a semiannual basis), there is always internal administration of such packages. Further, you will have the responsibility of being the source for answering questions about all forms and types of insurance, the differences in options, and the cost to employees. One of the ways that HR can contribute to the company is by keeping the costs of benefits down, and this means auditing the policies periodically to be certain that there haven't been increases in premiums either directly or indirectly through a decrease in benefits. One person should be responsible for new employee orientation. In order to inform new employees of their benefits and the policies of the company, you will very simply have to be the expert in benefits and policies of the company. Does the company have a compensation system or is it pretty much a hit-or-miss proposition? Are there job descriptions? Job specifications? Is compensation tied to responsibilities? Are increases in pay tied to contributions to the company, i.e., pay-for-performance? Do you need a graded compensation system? Contrary to popular opinion, I am not certain that a compensation analyst from outside the company is needed to set up a system in a company with fewer than 50

employees. I know that one is not necessary for companies with fewer than 20 employees. On the other hand, all these questions were rhetorical. What you will have to do is become proficient in writing or formalizing job descriptions. We can help as part of a subscription to ewin.com. HR has an information function that you should think through. Changes in policies, changes in benefits, even changes in laws must be communicated to all employees. Major changes may call for training such as in harassment a few years back. Major changes in medical insurance benefits (as opposed to unemployment or SDI -- for those in states with SDI) have to be disseminated to all affected employees. Therefore, HR becomes a kind of pass-through in the information cycle. I've left recruiting for last because it can be, but is not always a major function in smaller companies. Some small companies are very stable, hiring perhaps as few as one new employee in a 12-month period. Others are in very competitive industries where recruiting can be a function unto itself. Interviewing, selection, and placement are part and parcel of recruiting and knowledge of the techniques involved is very important. Hiring the wrong person(s) is extremely expensive. Therefore, if recruiting is a major function, it may be in the company's best interest to have a professional recruiter and another employee to handle all the other functions. (The recruiter must also have knowledge of benefits and policies and procedures, but his or her primary function would be to find and hire the best person at the "best" salary, i.e., one that satisfies the applicant and is affordable to the company.) Certainly there are other responsibilities, but they should be considered as secondary. While diversity may be high on the list of the more "social-minded" managers, don't ever expect to sit at the executive table if you emphasize issues (or non-issues) such as this. Insofar as possible, stay with those areas having to do with risk management, planning, and costs. Delegating the Christmas party and company picnic to someone else should be your first priority. Don't get caught up in becoming the company's "cruise director." You've got better things to do.

Ethan A. Winning

Responsibilities of Human Resource Departments

Job Analysis The process of getting detailed information about jobs. Job Design The process of defining the way work will be performed and the tasks that a given job requires. Recruitment The process through which the organization seeks applicants for potential employment. Selection The process by which the organization attempts to identify applicants with the necessary knowledge, skills, abilities, and other characteristics that will help the organization achieve its goals. Training A planned effort to enable employees to learn job-related knowledge, skills, and behavior. Development The acquisition of knowledge, skills, and behaviors that improve an employees ability to meet changes in job requirements and in customer demands. Performance Management The process of ensuring that employees activities and outputs match the organizations goals. Some other benefits includes, Planning an Administering Pay and Benefits Maintaining

Positive Employee Relations Establishing and Administering Personnel Policies Ensuring Compliance with Labor Laws Human Resource Planning Identifying the numbers and types of employees the organization will require in order to meet its objectives.
The Human Resources Department is responsible for the following:

Benefits Coordination EEO Rep/Affirmative Action Employment Process Contracts Employee Grievances Employee Evaluation Coordination Liaison with OPM Personnel Policies Oversight Policy and Procedure Manuals Staff Development

Worker's Compensation MAJOR FUNCTIONS OF THE HUMAN RESOURCES DEPARTMENT

HUMAN RESOURCES PLANNING Forecasting Maintaining personnel inventories Succession planning Modeling career paths EMPLOYMENT Recruitment Selection Testing Orientation TRAINING & DEVELOPMENT Devising programs: Hourly Workers Managerial Staff Primary Skills Training Advanced Skills Training Promoting diversity EQUAL EMPLOYMENT OPPORTUNITY Ensuring EEO compliance Administering affirmative action Handling discrimination complaints HR AUDITS

Employee turnover Grievances Attendance Accidents Compliance with federal and state regulations DISCIPLINE Formulation and coordination of policies Assistance and advice in major disciplinary actions PERSONNEL RESEARCH Administering opinion surveys Conducting HR audits Publishing statistical analysis SAFTEY Ensuring OSHA compliance Overseeing security Physical Environment Conducting accident investigations MEDICAL & HEALTH Conducting health and wellness programs EMPLOYEE BENEFITS Design of vacation & sick benefits program Administering policy 401k plan Health insurance COMPENSATION Administering: Incentive pay plans Job analysis Job evaluations Wage surveys Performance reviews LABOR RELATIONS
Instituting labor -management cooperative programs Hearing employee concerns and complaints Monitoring morale

What Does a Human Resources Manager, Generalist, or Director Do? Human Resources Generalists, Managers, and Directors, depending on the size of the organization, may have overlapping responsibilities. In larger organizations, the Human Resources Generalist, the Manager, and the Director have clearly defined, separated roles in HR

management with progressively more authority and responsibility in the hands of the Manager, the Director, and ultimately, the Vice President who may lead several departments including administration. HR directors, and occasionally HR managers, may head up several different departments that are each led by functional or specialized HR staff such as the training manager, the compensation manager, or the recruiting manager. Human Resources staff members are advocates for both the company and the people who work in the company. Consequently, a good HR professional performs a constant balancing act to meet both needs successfully. The Changing Human Resources Role The role of the HR professional is changing. In the past, HR managers were often viewed as the systematizing, policing arm of executive management. Their role was more closely aligned with personnel and administration functions that were viewed by the organization as paperwork. When you consider that the initial HR function, in many companies, comes out of the administration or finance department because hiring employees, paying employees, and dealing with benefits were the organization's first HR needs, this is not surprising. In this role, the HR professional served executive agendas well, but was frequently viewed as a road block by much of the rest of the organization. While some need for this role occasionally remains you wouldnt want every manager putting his own spin on a sexual harassment policy, as an example much of the HR role is transforming itself. New HR Role The role of the HR manager must parallel the needs of his or her changing organization. Successful organizations are becoming more adaptable, resilient, quick to change direction, and customer-centered. Within this environment, the HR professional, who is considered necessary by line managers, is a strategic partner, an employee sponsor or advocate and a change mentor. At the same time, especially the HR Generalist, still has responsibility for employee benefits administration, often payroll, and employee paperwork, especially in the absence of an HR Assistant. Depending on the size of the organization, the HR manager has responsibility for all of the functions that deal with the needs and activities of the organization's people including these areas of responsibility.

Recruiting. Hiring. Training. Organization Development. Communication. Performance Management. Coaching. Policy Recommendation. Salary and Benefits. Team Building. Employee Relations. Leadership.

With all of this in mind, in Human Resource Champions, Dave Ulrich, one of the best thinkers and writers in the HR field today, and a professor at the University of Michigan, recommends three additional roles for the HR manager. HR Role: Business and Strategic Partner In todays organizations, to guarantee their viability and ability to contribute, HR managers need to think of themselves as strategic partners. In this role, the HR person contributes to the development of and the accomplishment of the organization-wide business plan and objectives.

The HR business objectives are established to support the attainment of the overall strategic business plan and objectives. The tactical HR representative is deeply knowledgeable about the design of work systems in which people succeed and contribute. This strategic partnership impacts HR services such as the design of work positions; hiring; reward, recognition and strategic pay; performance development and appraisal systems; career and succession planning; and employee development. To be successful business partners, the HR staff members have to think like business people, know finance and accounting, and be accountable and responsible for cost reductions and the measurement of all HR programs and processes. It's not enough to ask for a seat at the executive table; HR people will have to prove they have the business savvy necessary to sit there. HR Role: Employee Advocate As an employee sponsor or advocate, the HR manager plays an integral role in organizational success via his knowledge about and advocacy of people. This advocacy includes expertise in how to create a work environment in which people will choose to be motivated, contributing, and happy. Fostering effective methods of goal setting, communication and empowerment through responsibility, builds employee ownership of the organization. The HR professional helps establish the organizational culture and climate in which people have the competency, concern and commitment to serve customers well. In this role, the HR manager provides employee development opportunities, employee assistance programs, gain sharing and profit-sharing strategies, organization development interventions, due process approaches to problem solving and regularly scheduled communication opportunities. HR Role: Change Champion The constant evaluation of the effectiveness of the organization results in the need for the HR professional to frequently champion change. Both knowledge about and the ability to execute successful change strategies make the HR professional exceptionally valued. Knowing how to link change to the strategic needs of the organization will minimize employee dissatisfaction and resistance to change. The HR professional contributes to the organization by constantly assessing the effectiveness of the HR function. He also sponsors change in other departments and in work practices. To promote the overall success of his organization, he champions the identification of the organizational mission, vision, values, goals and action plans. Finally, he helps determine the measures that will tell his organization how well it is succeeding in all of this.

What's Hot: Human Resources CareerBuilder.com Satisfied workers and good manager/employee communication are vital to the success of businesses. However, in most large corporations, to keep the peace at work it simply isn't possible for a worker to knock on the door of the company CEO to voice a concern. Therefore, companies rely on human resource managers to be that liaison and keep things running smoothly. If you have strong communication skills and enjoy helping others in a corporate setting, here are some facts about human resource managers from the Bureau of Labor Statistics (BLS). Overview Human resource managers have stepped into the limelight in many companies in recent years. Historically, human resource managers performed administrative tasks that include handling employee benefits and recruiting and interviewing new hires. Today, these workers perform these tasks, but also increasingly consult top executives about strategic planning.

These managers attempt to improve morale and productivity by providing training opportunities to boost employee skills and helping to increase employees' overall job satisfaction. Dealing with people and resolving problems are essential aspects of this career. Training and Education The duties and amount of responsibility assigned to human resource managers vary - and thus, so do the educational requirements. Many employers seek out entry-level candidates who majored in human resources, personnel administration, or industrial and labor relations; other employers look for grads with business, technical or liberal arts backgrounds. Some jobs are increasingly requiring advanced degrees in disciplines including industrial and labor relations. Experience in the field is also important for those seeking more advanced positions, but entry-level workers often enter formal training programs. Jobs in the human resources field require exceptional people skills. They must be good writers, able to handle conflicting points of view, fair-minded, discreet and have a persuasive, yet congenial personality. Opportunities Human resources workers' duties vary considerably by the size and type of organization. In a small organization, a human resources generalist might handle all aspects of the human resources work. In larger corporations, human resources duties are much more divided: the director of human resources may oversee several departments, each headed by an experienced manager. Employment and placement managers oversee the hiring and firing of employees. Employment, recruitment and placement specialists recruit and place workers. Recruiters travel extensively, often to college campuses, in search of promising candidates. EEO officers, representatives or affirmative action coordinators examine their company's Equal Employment Opportunity practices and handle grievances. Compensation, benefits and job analysis specialists conduct programs for employers, specializing in specific areas like position classifications or pensions. Occupational analysts conduct research about occupational classification systems and industry trends. Compensation managers establish and maintain a firm's pay system. Employee benefits managers and specialists are the company employee benefits experts. Training and development managers and specialists conduct and supervise training and development programs for employees. Training managers provide classroom or on-site worker training. the director of industrial relations forms labor policy and coordinates grievance procedures. Pros and cons Human resources jobs are usually in clean, pleasant settings, and many arbitrators and labor relations managers work at home. Many jobs have traditional 9-to-5 hours. Due to the

somewhat hierarchical nature of the profession, there are many opportunities for advancement. However, they must be prepared to work long hours in the case of a major dispute especially arbitrators, when new contracts are being prepared and negotiated. Some human resources workers must travel extensively, spending time away from their families. Salary Salaries for human resources workers fluctuate in accordance with their occupation, level of experience, training, location, size of firm and union status. Median annual earnings of human resources managers were $64,710 in 2002. Employment, recruitment and placement specialists earned $39,410 that same year. Compensation, benefits and job analysis specialists were paid $45,100. Job Outlook There is a steady supply of qualified college graduates interested in human resources work; therefore competition will be tight for jobs. But overall, human resources workers will enjoy faster-than-average job growth through 2012, according to the BLS. This demand will be spurred in part by new laws regulating the workplace, health, pensions and family leave. In addition, demand will be strongest for certain specialists (those who specialize in older job seekers, for example). Source: BLS October 2004

Perfect HR Organizational Chart Examples: