DEFINITIONS

MANAGEMENT – Effective utilization of human resources

for the achievement of organizational objectives thru the
combined efforts of human resources that technological,
financial, physical and all other resources are utilized.

HUMAN RESOURCES – Defined as the total knowledge,

skills, creative abilities, talents and aptitudes of an
organization's workforce, as well as the values, attitudes,
approaches and beliefs of the individuals involved in the
affairs of the organization.
 HUMAN RESOURCE MANAGEMENT
HRM is an integral but distinctive part of management,
concerned with people at work and their relationship
within the enterprise.

HRM can be defined as managing (planning, organising,

directing, controlling) the functions of employing ,
developing and compensating human resources resulting
in the creation and development of human relations with a
view to contribute proportionately to the organisational,
individual and social goals.
 SIMILAR TERMS
Labour Management
Labour Administration
Personnel Management
Personnel Administration
Human Capital Management
Human Asset Management
Employment Administration
Employee-Employer Relations
Union Management Relations
Industrial Relations
 NATURE OF HRM
Comprehensive Function – Concerned with all types of
people inside the organization

People Oriented – Dealing with human relationships

within an organisation

Action Oriented – Actions rather than procedures and

records – Solution of personnel problems to achieve both
organisational and personal goals.

Individual Oriented – Provide services and programmes

to facilitate employee satisfaction and growth.

Development Oriented – Developing the potential of

employees to achieve maximum.
• Pervasive Function – Inherent in all organisations and at all
levels

• Continuous Function – On going or never ending exercise

rather than a one shot function.

• Future Oriented – Concerned with helping an organisation to

achieve its objectives in the future.

• Challenging Function – Due to dynamic nature of people’s

emotions and they can’t be treated like machines

• Science as well as Art – Science –Tools, Principles and

Techniques ; Art – Handling People
• Staff Function – Advisory or Directing or monitoring
Function

•Young Discipline – Started in the last part of 19th

century.Relatively new specialized area as compared to
manufacturing and marketing.

•Interdisciplinary – Involves application of knowledge

drawn from Sociology, Psychology and Economics.

•Nervous System – Intimately associated with every

movement inside the organisation
 EVOLUTION OF HRM
Industrial Revolution
Trade Unionism
Social responsibility era
Scientific Management Era
Human Relations Era
Behavioural Science Era
System Approach Era
Contingency Approach Era
 Industrial revolution
The seed of HRM were sown during Industrial revolution
1850’s in Western Europe and USA.The wind gradually
reached to India in beginning of 20th century.During this
period:-

Machines were bought in

Technology made rapid progress
Workers were treated like machine tools
Employers were keen to meet production targets rather
than satisfy workers.
Govt. did very little to protect the interests of workers.
 TRADE UNIONISM
This was the period when state intervention to protect the
worker’s interest was felt necessary. During this period:-

Workers started to form their associations.

Trade Union Act, 1926 was passed in India.

The basic philosophy was to safeguard worker’s interest and to

sort out their problems like:-

Child labour
Long hours of work
Poor working conditions.
 SOCIAL RESPONSIBILITY ERA
Robert Owen,a British industrialist is considered to be the
first to adopt humanistic and paternalistic approach. He
viewed that the social and economic environment
influence the physical , mental and psychological
development of workers.

He practised the following :

Provision for reduced working hours

Housing facilities
Education of workers and their children
He admired for giving human treatment to workers.
 Scientific Management era:-
This concept was introduced by Fredrick Winslow Taylor in
USA early in 20th century. he developed following four
principles:-

Use of scientific methods in setting work stds.

Scientific selection and placement of workers best suited for
the tasks. Also provision for training.
Clear cut division of work and responsibility between
management and workers.
Harmonious relations and close cooperation with workers.
He developed following techniques
for the same:
Time study and Motion Study – Precise time taken for
each correct motion

Standardization of tools, equipments and machinery and

working conditions

 incentive wage plan with differential piece rate of wages.

 HUMAN RELATIONS ERA

This particular period focused on the

feelings,attitude and needs of the workers as
human beings.Between 1925 and 1935 Hugo
Munsterberg, a psychologist suggested the use of
psychology in selection, placement, testing and
training the employees in an organisation.
Between 1924 to 1932,Elton Mayo conducted
a series of experiments at hawthorne plant of
western electric company in USA.
Main findings were:-
Physical environment should be good
Favourable attitudes of workers and work team
towards their work
Fulfillment of worker’s social and psychological needs
Workers can be motivated through job security,right
to express their opinion on matters related to them.
 BEHAVIORAL SCIENCE ERA
It was concerned with social and psychological
aspects of human behaviour. Some of imp
elements were:-

Individual behaviour is linked with group

behaviour
Informal leadership rather than formal leadership
Motivation by self control and self development
Improving efficiency through Self operating
 SYSTEMS APPROACH ERA

Technical subsystem : formal relationships.

Social subsystem : informal group relations
Power subsystem : exercise of power
CONTINGENCY APPROACH ERA
• According to contingency,the best way to manage
varies with situation.

• There may not be the universal way of managing all

the situations.

• It is imperative for managers to analyse different

situations and then use the best suitable in that
particular situation.
 OBJECTIVES OF HRM
1. To create and utilize an able and motivated workforce, to
accomplish the basic organizational goals.

2. To establish and maintain sound organizational

structure and desirable working relationships among all
the members of the organization.

3. To secure the integration of individual or groups within

the organization by co-ordination of the individual and
group goals with those of the organization.

4. To create facilities and opportunities for individual or

group development so as to match it with the growth of
the organization
5. To attain an effective utilization of human resources in
the achievement of organizational goals.

6. To identify and satisfy individual and group needs by

providing adequate and equitable wages, incentives,
employee benefits and social security and measures for
challenging work, prestige, recognition, security, status.

7. To maintain high employees morale and sound human

relations by sustaining and improving the various
conditions and facilities.

8. To strengthen and appreciate the human assets

continuously by providing training and development
programs.
 9. To consider and contribute to the minimization of
socio-economic evils such as unemployment, under-
employment, inequalities in the distribution of income
and wealth and to improve the welfare of the society by
providing employment opportunities to women and
disadvantaged sections of the society.

10. To provide an opportunity for expression and voice

management.

11. To provide fair, acceptable and efficient leadership.

12. To provide facilities and conditions of work and

creation of favorable atmosphere for maintaining stability
of employment.
 FUNCTIONS OF HRM
MANAGERIAL FUNCTIONS
Planning – Formulating the future course of action

Organising – Establishing an intentional structure of roles for

people in an orgn such as chain of command, division of labour,
assignment of responsibilities.

Staffing – Obtaining and maintaining capable and competent

personnel.

Directing – Coordinating and motivating towards

organisational objectives

Controlling – Measurement and rectification of activities

Operative Functions Of HRM
Employment – Involves procuring & employing
individuals with suitable knowledge, skills & exp

Human Resource Development – Process of training

and developing employees to improve and update their
knowledge and skills

Compensation Management – Includes all the

extrinsic rewards that an employee receives during and
after the course of his job

Employee Relations – deals with employees in the

organisational context , as a social group that contributes
to the orgn.
 EMPLOYMENT
Human Resource Planning – Forecasting the human
resource requirements

Recruitment – process of seeking and attracting

prospective candidates against a vacancy in an orgn

Selection – choose the right candidate for a job

Placement – Selected candidate conveys his acceptance

of the offer of employment made by the orgn

Induction – Introducing a new employee to the orgn, its

business, culture,values, practices and procedures
HUMAN RESOURCE DEVELOPMENT
Performance Appraisal – Process of evaluating the
performance of an employee on the job & developing a plan for
improvement

Training – Systematic development of knowledge, skills,

attitudes required to perform a given task successfully.

Management Development – developing the employees of an

orgn to meet future changes and challenges

Career Planning & Development – Identifying one’s career

goals & formulating plans of reaching them thru education,
work exp.

Organisation Changes & Organisation Development

COMPENSATION MANAGEMENT
Job Evaluation – Systematic determination of the value
of each job in relation to other jobs in the orgn, industry &
market.

Wage and Salary Administration - Process of

formulating and operating a suitable wage and salary
program

Fringe Benefits – Monetary & Non-Monetary benefits

given to employees during their employment & post
employment period.
SOME OF THE FRINGE BENEFITS
Disablement Benefits
Housing Facilities
Canteen Facilities
Conveyance Facilities
Educational facilities for employees and their children
Credit Facilities
Recreational Facilities
Medical & Welfare Facilities
Post Retirement Benefits
 EMPLOYEE RELATIONS
Motivation

Morale

Job Satisfaction

Communication

Grievance & Disciplinary

 IMPORTANCE OF HRM
SIGNIFICANCE FOR AN ENTERPRISE
Attracting and retaining the required talent thru effective
HRP, recruitment, selection, placement, orientation,
compensation and promotion policies.

Developing the necessary skills & right attitude among

the employees thru training, development and
performance appraisal

Securing the willing cooperation of all employees thru

motivation, grievance handling.

Utilising effectively the available human resources

PROFESSIONAL SIGNIFICANCE

Providing maximum opportunities for personal

development of each employee.

Maintaining healthy relationships between individuals,

and different work groups.

Allocating work properly.

SOCIAL SIGNIFICANCE

Providing suitable employment that provides social and

psychological satisfaction to employees

Maintaining a balance between the jobs available and the

job seekers in terms of numbers, qualifications, needs and
aptitudes

Eliminating wastage of human resources thru

conservation of physical and mental health.
 ROLE OF HR MANAGER
 Service Provider - Providing info to individual
employees, Depts or groups and also to the top mgmt

 Executive – to carry out recruitment, compensation, etc

 Facilitator – To coordinate and facilitate the resources to

the employees

 Consultant – Motivation, Training, Grievance Handling

 Auditor – Ensuring that all members of the mgmt perform

their respective roles
 HUMAN RESOURCE POLICIES
Policies are plans of action.

Organizations need to evolve HR policies as they ensure

consistency and uniformity in treating people. They help,
motivate, and build loyalty

Policies become benchmarks to compare and evaluate

performance.
 BENEFITS OF HR POLICIES
The work involved in formulating personnel policies
requires that the mgmt give deep thought to the basic
needs of both the orgn and the employees.

Favoritism and discrimination are thereby minimised

Policies serve as a standard of performance

Sound policies help build employee motivation and loyalty

Sound policies help resolve intrapersonal, interpersonal

and intergroup conflicts.
5 PRINCIPAL SOURCES FOR DETERMINING THE
CONTENT & MEANING OF POLICIES
Past practice in the organisation

Prevailing practice in rival companies

Attitudes and philosophy of founders of the company and

top management

Attitudes and philosophy of middle and lower

management

The knowledge and experience gained from handling

countless personnel problems on a day-to-day basis
 PERSONNEL PRINCIPLES –
Fundamental truth established by research, investigation
and analysis
Principle of individual development
Principle of scientific selection
Principle of free flow of communication
Principle of participation
Principle of fair remuneration
Principle of incentive
Principle of dignity of labour
Principle of labour management cooperation
Principle team spirit
Principle of contribution to national prosperity
 HRIS – HUMAN RESOURCE
INFORMATION SYSTEM

Systematic way of storing data and

information for each individual employee to aid
planning, decision making, and submitting of return
and reports to the external agencies
 PURPOSE OF HRIS
Storing info and data for each individual employee for
future reference

Providing a basis for planning, organizing, decision

making, controlling and other HR functions

Meeting daily transactional requirements such as marking

present/absent, and granting leave.

Supplying data and submitting returns to govt. and other

statutory agencies
 APPLICATIONS
PERSONNEL ADMINISTRATION
Encompass info about each employee such as name,
address, date of birth, date of joining and info about family.

SALARY ADMINISTRATION
The report should give the details of present salary, last
increase, and the proposed increase

LEAVE AND ABSENCE RECORDING

A fundamental aspect of leave management is to maintain
a complete leave history for each employee with the ability
to increase entitlement according to leave rules.
SKILL INVENTORY
This will provide the opportunity to identify employees
with the necessary skills for certain positions or job
functions

MEDICAL HISTORY
To record occupational health data required for industrial
safety purposes, accident monitoring , exposure to
potentially hazardous materials and so on.

ACCIDENT MONITORING
Details of the accidents and a list of injured employees
PERFORMANCE APPRAISAL
Individual employee performance appraisal data such as the
due date of the appraisal , scores for each performance
criteria , potential for promotion, and other info to form a
comprehensive overview of each employee

TRAINING AND DEVELOPMENT

Training and development needs of an employee, with the
ability to record and enquire on courses completed and any
projected training courses

HUMAN RESOURCE PLANNING

Record details of the organisational requirements in terms of
positions
RECRUITMENT
Recording details of recruitment activity such as the cost
and method of recruitment, and the time taken to fill the
position can be used to provide a picture of the cost of
recruitment in terms of time as well as cost.

CAREER PLANNING
The system must be capable of providing succession plans to
identify which employees have been earmarked for which
positions
 STEPS IN IMPLEMENTING HRIS
INCEPTION OF IDEA – where and why we need HRIS
FEASIBILITY STUDY – Present system should be studied to highlight
the problem areas and the likely benefits of HRIS
SELECTING A PROJECT TEAM
DEFINING THE REQUIREMENTS
VENDOR ANALYSIS
CONTRACT NEGOTIATIONS
TRAINING
TAILORING THE SYSTEM – Making necessary changes to best fit the
organisational needs
COLLECTING DATA
TESTING THE SYSTEM
STARTING UP
MAINTENANCE
AUDIT
ADVANTAGES OF HRIS
Higher speed of retrieval and processing of data
Ease in classifying and reclassifying data
Better analysis leading to more effective decision making
Higher accuracy of info /report generated
Fast response to answer queries
Improved quality of reports
Better work culture
Establishment of steamlined and systematic procedures
More transparency in the system
 LIMITATIONS OF HRIS
Expensive in terms of finance and manpower
requirements

It can be threatening and inconvenient to those who are

not comfortable with computers.

Computers cannot substitute human being. Human

intervention will always be necessary
 COMPUTER APPLICATIONS IN HRM
MANAGEMENT INFORMATION SYSTEM(MIS)
A wide variety of info needs of a business are recognised
and interconnected with subsystems

ELECTRONIC DATA INTERCHANGE(EDI)

A computer is an electronic tool used to collect, organise,
analyse, interpret and communicate vast amount of info
with great speed. Electronic data interchange facilitate the
speedy, secured and accurate transfer of documents across
the globe
E-BUSINESS
E-Business is about using the convenience,
availability and worldwide reach to enhance existing
business or creating new virtual business

E-Business combines the traditional information

system with the vast reach of the web and connects
critical business systems directly to critical business
constituencies viz., production, marketing, finance,
customers, suppliers and employees via internets,
extranets and the world wide web
 E- HRM
Electronic aspect is embodied in all the areas of HRM
where there is transmission of information from one
employee to another employee and from one client to
another

Both internally and the processed form are highly

essentials in most of the functions and activities of HRM.
The important aspects of E-HRM are
E-Job Design and Job Analysis
E – Human Resource Planning
E-Recruitment
E – Selection
E-Performance Management
E-Training & Development
E – Compensation Management
E – Grievance Redressal
E – HR Records
E – HR Information
E – HR Audit
E – JOB DESIGN AND JOB ANALYSIS
The information of listing skills and competency
mapping are placed on the net.

Then the system matches the listing skills and

competency mapping and produces the output of
identifying the employee suitable for a particular task.
 E-HUMAN RESOURCE PLANNING
Computer Programs are developed and used extensively
for the purpose of planning human resource requirements
based on the data and the information

These programmes indicate the number of employees

required at each level for each category of the jobs based
on sales and production forecasts.
 E - RECRUITMENT
Organisations advertise job vacancies thru the World
Wide Web(WWW)or send the info directly to the
most competent people thru e-mail

The job seekers send their applications thru e-mail

using internet.Alternatively job seekers place their
CV’s in the World Wide Web(WWW)thru various
jobsites
 E - SELECTION

E – Selection has become popular with the conduct of

various tests thru online, contacting the candidates
thru e-mail and conducting the preliminary
interviews and final interview thru audio and video
conferencing
E – PERFORMANCE MANAGEMENT
The software on employee performance appraisal provides
a number of statements and sub statements on each of the
performance categories.

The appraiser selects and clicks the appropriate rating for

each statement. The system generates a detailed report by
the time the appraiser has moved all the performance
categories and sub factors

The report modified, comments can be added or deleted

by the appraiser and a final report can be prepared by the
manager
 E – TRAINING AND DEVELOPMENT
Companies started providing online training and online
executive development. Employees learn various skills by
staying at the place of their work. Participants complete
course work from wherever they have access to a computer
and an internet

E – Learning is enabled by the delivery of content via all

electronic media, including the internet, intranet, satellite
broadcast audio/video tape, interactive TV and CD-ROM
E – COMPENSATION MANAGEMENT
Almost all the organisations started using computers
for salary fixation, salary payment, salary calculations,
fixation and calculation of various allowances ,
employee benefits, welfare measures and fringe
benefits
 E – GRIEVANCE REDRESSAL

Employees send their grievance via e-mail to the

superior concerned who in turn solves the problems /
redress grievances and communicates the same to the
employee. This reduces the time in the process and
avoids face to face interaction
 E – HR RECORDS
HR records are created, maintained and updated with the help of
computers easily and at a first rate.

E – HR INFORMATION
HR info is generated, maintained , processed and transmitted to
the appropriate places or clients with the help of software with
high speed and accuracy.
 E – HR AUDIT
The standard human resource practices or the desired
HR practices are fed into the computer. The data and
info regarding the actual practices are also fed into
the computer

The software automatically completes the HR audit

and produces the audit report. The HR manager then
can modify the report by deleting or adding any
comments.