CHAPTER 1: INTRODUCTION TO HUMAN RESOURCE MANAGEMENT

Human Resource Management (HRM)

HRM is the management of people in an organization, including their acquisition, development, motivation, compensation, and maintenance.

Can also be defined as the planning, organizing, directing, and controlling of the procurement, development, resources to the end that individual and societal objectives are accomplished.

NATURE OF HUMAN RESOURCE MANAGEMENT

The emergence of human resource management can be attributed to the writings about human relations who attached great significance to the human factor. They seriously describe that management is personnel administration. This view is partially true as management is concerned with the efficient and effective use of both human as well as non-human resources. Thus human resource management is only a part of the management process. At the same time, it must be recognized that human resource management is inherent in the process of management.

All the managers perform this function. A manager to get the best of his people must undertake the basic responsibility of selecting people who will work under him and to help develop, motivate and guide them. However, he can take the help of the specialized services of the personnel department in discharging this responsibility.

Inherent Part of Management:

Human resource management is inherent in the process of management. This function is performed by all the managers throughout the organization rather that by the personnel department only. if a manager is to get the best of his people, he must undertake the basic responsibility of selecting people who will work under him.

Pervasive Function

Human Resource Management is a pervasive function of management. All managers at various levels in the organization perform it. It is not a responsibility that a manager can leave completely to someone else. However, he may secure advice and help in managing people from experts who have special competence in personnel management and industrial relations.

Basic to all Functional Areas:

Human Resource Management permeates all the functional area of management such as production management, financial management, and marketing management. That is every manager from top to bottom; working in any department has to perform the personnel functions.

People Centered:

Human Resource Management is people centered and is relevant in all types of organisations. It is concerned with all categories of personnel from top to the bottom of the organisation. The broad classification of personnel in an industrial enterprise may be the blue-collar workers like those working on machines and engaged in loading, unloading etc. and the white-collar workers such as clerical employees, Managerial and non-managerial personnel, Professionals such as Chartered Accountant, Company Secretary,

Personnel Activities or Functions:

Human Resource Management involves several functions concerned with the management of people at work. It includes manpower planning, employment, placement, training, appraisal and compensation of employees. For the performance of these activities efficiently, a separate department known as Personnel Department is created in most of the organisations.

Continuous Process:

Human Resource Management is not a one shot function. It must be performed continuously if the organisational objectives are to be achieved smoothly.

Based on Human Relations:

Human Resource Management is concerned with the motivation of human resources in the organisation. The human beings can't be dealt with like physical factors of production. Every person has different needs, perceptions and expectations. The managers should give due attention to these factors. They require human relations skills to deal with the people at work. Human relations skills are also required in training performance appraisal, transfer and promotion of subordinates.

Personnel Management VS Human Resource Management:

Contemporary Human Resource Management, as a part and parcel of management function, underscores strategic approach to management in areas of acquisition, motivation, and management of people at work.

Human Resource Management and Person

derives its origin from the practices of the earlier personnel management, which assisted in the management of people in an organisation setup. Human Resource Management leverages setting up the systems and procedures for ensuring efficiency, controlling and providing equality of opportunities for all working for the organisation. Human Resource Management (HRM) differs from Personnel Management (PM) both in scope and orientation.

HRM views people as an important source or asset to be used for the benefit of organisations, employees and society. It is emerging as a distinct philosophy of management aiming at policies that promote mutuality-mutual goals, mutual respect, mutual rewards and mutual responsibilities. The belief is that policies of mutuality. will elicit commitment, which in turn, will yield both better economic performance and greater Human Resource Development (HRD). Though a distinct philosophy, HRM cannot be treated in isolation. It is being integrated into the overall strategic management of businesses.

FUNCTIONS OF HUMAN RESOURCE MANAGEMENT

The main functions of human resource management are classified into two categories such as Managerial Functions and Operative Functions.

Managerial Function: Planning

The planning function of human resource department pertains to the steps taken in determining in advance personnel requirements, personnel programmes, policies etc. After determining how many and what type of people are required, a personnel manager has to devise ways and means to motivate them.

Managerial Function: Organization

Under organisation, the human resource manager has to organise the operative functions by designing structure of relationship among jobs, personnel and physical factors in such a way so as to have maximum contribution towards organisational objectives. In this way a personnel manager performs following functions: (a) preparation of task force; (b) allocation of work to individuals; (c) integration of the efforts of the task force; (d) coordination of work of individual with that of the department.

Managerial Function: Directing

Directing is concerned with initiation of organised action and stimulating the people to work. The personnel manager directs the activities of people of the organisation to get its function performed properly. A personnel manager guides and motivates the staff of the organisation to follow the path laid down in advance.

Managerial Function: Controlling

It provides basic data for establishing standards, makes job analysis and performance appraisal, etc. All these techniques assist in effective control of the qualities, time and efforts of workers.

Operative Function: Procurement of Personnel

It is concerned with the obtaining of the proper kind and number of personnel necessary to accomplish organisation goals. It deals specifically with such subjects as the determination of manpower requirements, their recruitment, selecting, placement and orientation, etc.

Operative Function: Development of Personnel

Development has to do with the increase through training, skill that is necessary for proper job performance.

In this process various techniques of training are used to develop the employees. Framing a sound promotion policy, determination of the basis of promotion and making performance appraisal are the elements of personnel development function.

Operative Function: Compensation to Personnel

Compensation means determination of adequate and equitable remuneration of personnel for their contribution to organisation objectives. To determine the monetary compensation for various jobs is one of the most difficult and important function of the personnel management. A number of decisions are taken into the function, viz., job-evaluation, remuneration, policy, inventive and premium plans, bonus policy and co-partnership, etc. It also assists the organisation for adopting the suitable wages and salaries, policy and payment of wages and salaries in right time.

Operative Function: Maintaining Good Industrial Relation

Human Resource Management covers a wide field. It is intended to reduce strifies, promote industrial peace, provide fair deal to workers and establish industrial democracy. It the personnel manager is unable to make harmonious relations between management and labour industrial unrest will take place and millions of man-days will be lost. If labour management relations are not good the moral and physical condition of the employee will suffer, and it will be a loss to an organisation vis-a-visa nation. Hence, the personnel manager must create harmonious relations with the help of sufficient communication system and co-partnership.

Operative Function: Record Keeping

In record-keeping the personnel manager collects and maintains information concerned with the staff of the organisation. It is essential for every organisation because it assists the management in decision making such as in promotions.

Operative Function: Personnel Planning and Evaluation

Under this system different type of activities are evaluated such as evaluation of performance, personnel policy of an organisation and its practices, personnel audit, morale, survey. and performance appraisal, etc.

IMPORTANCE OF HUMAN RESOURCE MANAGEMENT

Human Resource Management has a place of great importance. According to Peter F. Drucker, The proper or improper use of the different factors of production depends on the wishes of the human resources. Hence, besides other resources human resources need more development. Human resources can increase cooperation but it needs proper and efficient management to guide it.

FUTURE CHALLENGES BEFORE THE MANAGERS

Because of continuous changing socio-economic, technological and political conditions, the human resource managers of the future shall have to face more problems in the management of labour. The human resource managers of today may find themselves obsolete in the future due to changes in environment if they do not update themselves some of the important challenges which might be faced by the managers in the management of people in business and industry are discussed below:

Future Challenges: Increasing Size of Workforce:

The size of organisations is increasing. A large number of multinational organisations have grown over the years. The number of people working in the organisation has also increased. The management of increased workforce might create new problems and challenges as the workers are becoming more conscious of their rights.

Future Challenges: Increase in Education Level

The governments of various countries are taking steps to eradicate illiteracy and increase the education level of their citizens.

Educated consumers and workers will create very tough task for the future managers.

Future Challenges: Technological Advances

With the changes coming in the wake of advanced technology, new jobs are created and many old jobs become redundant. There is a general apprehension of immediate unemployment. In the competitive world of today, industry cannot hope to survive for long with old technology.

The problem, of unemployment resulting from modernisation will be solved by properly assessing manpower needs and training of redundant employees in alternate skills.

Future Challenges: Changes in Political Environment

There may be greater Government's interference in business to safeguard the interests of workers, consumers and the public at large. Government's participation in trade, commerce and industry will also pose many challenges before management. The Government may restrict the scope of private sector in certain areas in public interest. It does not mean chances of co-operation between the Government and private sector are ruled out. In fact, there will be more and more joint sector enterprises.

Future Challenges: Increasing Aspirations of Employees

Considerable changes have been noted in the worker of today in comparison to his counterpart of 1950s. The workers are becoming more aware of their higher level needs and this awareness would intensify further in the future workers.

Future Challenges: Changing Psychosocial System

In future, organisations will be required to make use of advanced technology in accomplishing their goals while satisfying human needs. In the traditional bureaucratic model, the organisations were designed to achieve technical functions with a little consideration given to the psychosocial system. But future management would be required to ensure effective participation of lower levels in the management of the organisation system.

Future Challenges: Computerised Information System

In the past, the automation of manufacturing processes had a major effect upon the systems of production, storage, handling and packaging, etc. More recently, there has been and in the future there will be the impact of revolutionary computerised information system on management. This revolutionary development would cover two primary areas of personnel management which are as follows: (a) The use of electronic computers for the collection and processing of data, and (b) The direct application of computers in the managerial decision making process.

Future Challenges: Mobility of Professional Personnel

Organizations will expand the use of boundary agents whose primary function will be achieving coordination with the environment. One interesting fact will be an increase in the mobility various managerial and professional personnel between organizations. As individuals develop greater technical and professional expertise, their services will be in greater demand by other organizations in the environment.

Future Challenges: Changes in Legal Environment

Many changes are taking place in the legal framework within which the industrial relations systems in the country are now functioning. It is the duty of the human resource or personnel executive to be aware of these changes and to bring about necessary adjustments within the organisations so that greater utilisation of human resources can be achieved:

This, indeed, is and would remain a major challenge for the personnel executive.

Future Challenges: Management of Human Relations

On the industrial relations 'front, things are not showing much improvement even after so many efforts by the government in this direction. Though a large number of factors are responsible for industrial unrest but a very significant cause is the growth of multi-unions in industrial complexes having different political affiliations. Under the present conditions, it appears that inter-union rivalries would grow more in the coming years and might create more problems in the industry. Management of human relations in the future will be more complicated than it is today. Mány of the new generation of employees will be more difficult to motivate than their predecessors. This will be in part the result of a change in value systems coupled with rising educational levels. Greater scepticism concerning large organisations and less reverence for authority figures will be more common.

Unquestioning acceptance of rules and regulations will be less likely.

Future Challenges: New Role of Human Resource Management

Human Resource Management in the New Millennium has undergone a great revolution by questioning the accepted practices and re-inventing the organisations as well as structures.

Many traditional practices have been thrown out. As an example, it can be seen that hierarchies are vanishing and there is greater emphasis on flat organisations. It means a great deal of specialisation and skills. It also means upgrading the norms and standards of work as well as performance.

New Role of Human Resource Management: A Facilitator of Change

To carry people through upheaval requires the true management of human resources.

New Role of Human Resource Management: An Integrated Approach to Management

Rather than being an isolated function, human resource is regarded as a core activity, one which shapes a company's values. In particular, this can have an impact on customer service.

New Role of Human Resource Management: A Mediator

Establishing and balancing the new and emerging aspirations and requirements of the company and the individual. These changes, which are taking place, involve more commitment of the organisation to the development of people by improving performance and cutting costs.

Functions of a Human Resource Manager

A human resource manager, charged with fulfilling the objectives of an organisation, should be a leader with high intellectual powers, a visionary and a philosopher who provides the initiative to shape the future in terms of leading the human beings in an organisation towards more prosperous and progressive policies.

Factors: Human Resource Man as an Intellectual

The basic skill in the human resource field as compared to technologists or financial experts is the skill to communicate, articulate, understand and above all, to be an expert when it comes to putting policies and agreements in black and white. The personnel man's skill lies in his command over the language. A personnel man has to deal with employees and he must possess the skills of conducting fruitful and systematic discussions and of communicating effectively. He should also be in a position to formulate principles and foresee the problems of the organization.

This means that he would require the mental ability to deal with his people in an intelligent manner as well as to understand what they are trying to say.

Factors: Human Resource Man as an Educator

It is not enough that a human resource man has command-over the language, which, however, remains his primary tool. He should be deeply interested in learning and also in achieving growth.

Basically, human beings like to grow and realize their full potential. In order to harmonize the growth of individuals with that of the organization, a personnel administrator must not only provide opportunities for his employees to learn, get the required training and assimilate new ideas but also he himself should be a teacher. A personnel man who simply pushes files and attends labour courts for conciliation purposes and other rituals of legal procedure for the settlement of industrial disputes is not a personnel administrator of the future.

Factors: Human Resource Man as a Discriminator

A human resource administrator must have the capacity to discriminate between right and wrong, between that which is just and unjust and merit and non-merit. In other words, he should be a good judge when he sits on a selection board, a fair person when he advises on disciplinary matters and a good observer of right conduct in an organization.

Factors: Human Resource Man as an Executive

The human resource man must execute the decisions of the management and its policies with speed, accuracy and objectivity. He has to streamline the office, tone up the administration and set standards of performance. He has to coordinate the control functions in relation to the various other divisions and, in doing so he should be in a position to bring unity of purpose and direction in the activities of the personnel department. He must ask relevant questions and not be merely involved in the office routine whereby the status quo is maintained. He should have the inquisitiveness to find out causes of delay, tardy work and wasteful practices, and should be keen to eliminate those activities from the personnel functions which have either outlived their utility or are not consistent with the objectives and purposes of the organization.

Factors: Human Resource Man as a Leader

Being basically concerned with people or groups of people, and being placed in the group dynamics of various political and social functions of an organization, a Human resource man must not shirk the role of leadership in an organization. He, by setting his own example and by working towards the objectives of sound personnel management practices, must inspire his people and motivate them towards better performance. He should resolve the conflicts of different groups and build up teamwork in the organization.

Factors: Human Resource Man as a Humanist

Deep faith in human values and empathy with human problems, especially in less developed countries, are the sine qua non for a Human resource man. He has to deal with people who toil at various levels and partake of their joys and sorrows. He must perform his functions with sensitivity and feeling.

Factors: Human Resource Man as a Visionary

While every leading function of an organisation must evolve its vision of the future, the primary responsibility for developing the social organisation towards purposive and progressive action fall on the personnel man. He should be a thinker who sets the pace for policy-making in an organisation in the area of human relations and should gradually work out new patterns of human relations management consistent with the needs of the organisation and the society. He must ponder on the social obligations of the enterprise, especially if it is in the public sector, where one has to work within the framework of social accountability. He should be in close touch with socio-economic changes in the country. He should be able to reasonably forecast future events and should constantly strive to meet the coming challenges.

Role and Challenges of Human Resource Manager

Human Resource (HR) Department is established in every organisation under the charge of an executive known as Human Resource Manager. This department plays an important role in the efficient management of human resources. The human resource department gives assistance and provides service to all other departments on personnel matters. Though personnel or human resource manager is a staff officer in relation to other departments of the enterprise, he has a line authority to get orders executed within his department. The human resource manager performs managerial functions like planning, organising, directing and controlling to manage his department. He has also to perform certain operative functions like recruitment, selection, training, placement, etc., which the other line managers may entrust to him.

He is basically a manager whatever may be the nature of his operative functions. The status of Human Resource Manager in an organisation depends upon the type of organisation structure.

Role of Human Resource Manager in an Organization

In most of the big enterprises, human resource department is set up under the leadership of personnel manager who has specialised knowledge and skills. The human resource manager performs managerial as well as operative functions. Since he is a manager, he performs the basic functions of management like planning, organising, directing and controlling to manage his department. He has also to perform certain operative functions of recruitment, selection, training, placement, etc., which the problems to management, the human resource managers attach highest priority to the settlement of industrial disputes than anything else. The role of human resource management in industry is underlined by the complex and dynamic nature of environment under which the modern large-scale industries function. The impact of technology on organisation structure, politicisation of workers' unions, and the growing consciousness of industrial employees about their rights and privileges, have made the role of personnel management increasingly more important in industrial undertakings. The task has also been facilitated by the greater recognition of the value of human resources in industry and application of human resource development (HRD) techniques by the enlightened managers in modern organisations.