Unit-1 - Lecture notes 3 PDF

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LECTURE NOTE OF SOMYA MAM...

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Institute of Innovation in Technology and Management, New Delhi (Affiliated to GGSIP University) Academic Session: 2017- 2018 Unit 1 : Introduction to HRM Course Name: BBA Semester:-IV

Paper Code: BBA 202

Academic Year:-2017-18

Unit I Introduction: Concept, nature, scope, objectives and importance of HRM; Evolution of HRM; Challenges of HRM; Personnel Management vs HRM. Strategies for the New Millennium: Role of HRM in strategic management; human capital; emotional quotient; mentoring; ESOP; flexitime; quality circles; Kaizen TQM and Six Sigma.  HUMAN RESOURCE MANAGEMENT: DEFINITIONS  According to Dale Yoder, management of human resources is viewed as a system in which participants seek to obtain individual and group goals.  According to Flippo, “HRM is also the planning, organizing, directing, controlling of procurement, development, motivation, compensation, maintenance and integration to achieve individual, organizational and societal goals”.  Human resources may be 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.  It is the sum total or aggregate of inherent abilities, acquired knowledge and skills represented by the talents and aptitudes of the persons employed in the organization.  VIEWS OF HRM:  From the national point of view, human resources may be defined as the knowledge, skills, creative abilities, talents and aptitudes obtained in the population  From the view point of the individual enterprise, they represent the total of the inherent abilities, acquired knowledge and skills FUNCTIONS HUMAN RESOURCE MANAGEMENT Personal or Human Resource Management is concerned with three sets of functions- managerial and operative functions: 1. Managerial Functions:  Planning  Organizing HRM Page 1

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Directing Controlling Operational Functions Procurement Development Motivation and Compensation Maintenance Integration Emerging Issues

3. Advisory Functions

A) MANAGERIAL FUNCTIONS: 1. Planning:  Planning is necessary to determine the goals of the organization and lay down policies and procedures to reach the goals.  For a human resource manager, planning means the determination of personnel programs that will contribute to the goals of the enterprise, i.e., anticipating vacancies, planning job requirements, job descriptions and determination of the sources of recruitment. 2. Organizing: HRM Page 2

Once the human resource manager has established objectives and developed plans and programs to reach them, he must design and develop organization structure to carry out the various operations. The organization structure basically includes the following: o Grouping of personnel activity logically into functions or positions; o Assignment of different functions to different individuals; o Delegation of authority according to the tasks assigned and responsibilities involved; o Co-ordination of activities of different individuals. 3. Directing:  The direction function of the personnel manager involves encouraging people to work willingly and effectively for the goals of the enterprise.  The personnel manager can motivate the employees in an organization through career planning, salary administration, ensuring employee morale, developing cordial relationships and provision of safety requirements and welfare of employees. 4. Controlling:  Controlling is concerned with the regulation of activities in accordance with the plans, which in turn have been formulated on the basis of the objectives of the organization. Thus, controlling completes the cycle and leads back to planning.  It involves the observation and comparison of results with the standards and correction of deviations that may occur.  It involves performance appraisal, critical examination of personnel records and statistics and personnel audit.

B) OPERATIVE FUNCTIONS:  The operative functions are those tasks or duties which are specifically entrusted to the human resource or personnel department.  These are concerned with employment, development, compensation, integration and maintenance of personnel of the organization.

The operative functions of human resource or personnel department are discussed below:

1. Procurement:   

It is concerned with procuring and employing people who possess necessary skill, knowledge and aptitude. Procurement refers to a string of activities undertaken by the HR managers for filling the present and future vacancies of the organization. The activities include job analysis and designing, HR planning, recruitment and, finally, the selection of suitable employees.

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a. Job Analysis: Job analysis is the process of gathering and analyzing information about the content and the human requirements of jobs, as well as, the context in which jobs are performed. This process is used to determine placement of jobs. b. Human Resource Planning:It is a process for determination and assuring that the organization will have an adequate number of qualified persons, available at proper times, performing jobs which would meet the needs of the organization and which would provide satisfaction for the individuals involved. c. Recruitment:It is the process of searching for prospective employees and stimulating them to apply for jobs in an organization. d. Selection: It is the process of ascertaining the qualifications, experience, skill, knowledge etc., of an applicant with a view to appraising his / her suitability to a job appraising. e. Placement:It is the process of assigning the selected candidate with the most suitable job in terms of job requirements. It is matching of employees specifications with job requirements. f. Induction and Orientation: Induction and orientation are the techniques by which a new employee is rehabilitated in the changed surroundings and introduced to the practices, policies, purposes and people of the organization.

2.Development: It is the process of improving, moulding, changing and developing the skills, knowledge, creative ability, aptitude, attitude, values and commitment based on present and future requirements both at the individual’s and organisation’s level.  The very purpose of a training and development programme is to increase the employees’ competencies in their job by improving their knowledge, skills and abilities(KSA). This may be done through: a. Training: the process through which employees learn new skills and abilities for obtaining organizational goals. Employee Training Is Important because:  Educates workers about the effective use of technology,  Ensures competitive edge in the market,  Promotes safety and health among employees,  Creates opportunities for career development and personal growth, an important factor in retaining workers  Helps employers comply with laws and regulations, and  Improves productivity and profitability. 

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b. Executive Development: Process of developing managerial skills and capabilities.

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Executive development is the whole of activities aimed at developing the skills and competencies of those at executive positions in organisations. "executive" is commonly used to signify the top 5% to 10% of the organization. c. Career Planning and Development: Involves planning one’s career and implementation of career plans through education training, job search. Career planning generally involves getting to know who you are, what you want, and how to get there. In order to plan your career, you need to have an idea of what constitutes career success. o Do you want to be president of the company? o Do you want to be the senior executive in your field of expertise? o Would you be happier as a middle manager in your area? d. Human Resource Development: This aims at development of the total organisation In the words of Prof. T.V. Rao, "HRD is a process by which the employees of an organisation are helped in a continuous and planned way to : 1. acquire or sharpen capabilities required to perform various functions associated with their present or expected future roles; 2. develop their capabilities as individual and discover and exploit their own inner potential for their own and /or organisational development purposes; (3) Motivation and Compensation: Compensation refers to the determination of the pay scale and other benefits for the employees. They must devise ways to ensure fair and equitable pay rates, regularly manage the performance evaluation system of the organization continuously design reward systems such as performance-linked incentive plans and bonus and flexible work schedules, the use of intrinsic (achievement, recognition, responsibility) and extrinsic (job design, work scheduling, appraisal based incentives) rewards. a. Job design: Organizing tasks and responsibilities towards productive unit of work. Job design (also referred to as work design or task design) is the specification of contents, methods and relationship of jobs in order to satisfy technological and organizational requirements as well as the social and personal requirements of the job holder.

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The aim of a job design is to improve job satisfaction, to improve through-put, to improve quality and to reduce employee problems (e.g., grievances, absenteeism). b. Work scheduling: To motivate employees through job enrichment, shorter work weeks, work sharing, home work assignments. Providing staff and departments some flexibility in defining when, where and how work is done. This flexibility is a critical driver of employee well-being and performance. includes the compressed workweek, flextime, and telecommuting. c. Motivation: Internal and external factors that stimulate desire and energy in people to be continually interested and committed to a job, role or subject, or to make an effort to attain a goal. These factors are the reasons one has for behaving a certain way. An example is a student that spends extra time studying for a test because he or she wants a better grade in the class. d. Job Evaluation: A job evaluation is a systematic way of determining the value/worth of a job in relation to other jobs in an organization. It tries to make a systematic comparison between jobs to assess their relative worth for the purpose of establishing a rational pay structure.

e. Performance Appraisal: A performance appraisal is a systematic and periodic process that assesses an individual employee’s job performance and productivity in relation to certain pre-established criteria and organizational objectives.  Historically, PA has been conducted annually (long-cycle appraisals); however, many companies are moving towards shorter cycles (every six months, every quarter), and some have been moving into short-cycle (weekly, bi-weekly) PA. f. Compensation administration:The Compensation Administration Department is charged with the task of developing and maintaining a comprehensive compensation and classification system in order to support the mission of the Division of Human Resources. g. Incentives and Benefits:An incentive system is a business management tool that introduces a structured motivation system to promote desired employee behaviors. Ex: ESOPS, birthday gifts, paid holidays. 

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(4) Maintenance:  

It aims at protecting and preserving the physical and psychological health of employees through various welfare measures. HR managers are responsible for offering a wide range of HR programmes covering occupational safety, health promotion and physical fitness, canteen facilities, recreation activities, transportation programmes, employee suggestion schemes, career counselling and growth for creating a positive work environment.

a) Health and Safety:  Employers have a responsibility to protect workers against health and safety hazards at work.  Workers have the right to know about potential hazards and to refuse work that they believe is dangerous. b) Employee Welfare:  Employee welfare is a term including various services, benefits and facilities offered to employees by the employers.  Employee welfare also includes monitoring of working conditions, creation of industrial harmony through infrastructure for health, industrial relations and insurance against disease, accident and unemployment for the workers and their families. c) Social Security Measures:  The security which society furnishes through appropriate organizations against certain risks to which its members are perennially exposed such as the economic and social distress that otherwise would be caused by the stoppage or substantial reduction of earnings resulting from sickness, maternity, employment injury, invalidity and death; the provision of medical care; and the provision of subsidies for families with children. (5) Integration:  This tries to integrate the goals of an organization with employee aspirations through various employee-oriented programmes, like redressing grievances promptly, instituting proper disciplinary measures, empowering people to decide things independently, encouraging a participative culture, offering constructive help to trade unions a) Grievance redressal:  Employee grievance refers to the dissatisfaction of an employee with what he expects from the company and its management. A company has to provide an employee with a safe working environment, realistic job preview, adequate compensation, respect etc.  Grievance redressal committee is that committee in an organization which deals with or sorts out the disputes or issues or complaints arising within the organization.

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b) Discipline:  Discipline is systematic instruction intended to train a person, to follow a particular code of conduct or "order". This is the case because enforcement of order is often regulated through the threat of punishment to ensure given instructions are carried out. c) Teams and team work:  A team is a group of people who collaborate on related tasks toward a common goal.  That objective can be creating a product, delivering a service, writing a report, or making a decision. Teamwork differs from individual work in that it involves shared responsibility for a final outcome. d)Collective bargaining:  The process of agreeing on satisfactory labour contract between management and union.  Collective bargaining is a process of negotiation between employers and a group of employees aimed at reaching agreements to regulate working conditions, wage scales, working hours, training, health and safety, overtime, grievance mechanisms, and rights to participate in workplace or company affairs. e) Employee empowerment:  Employee empowerment generally involves management recognizing that employees are in a better position to oversee their own duties and work processes.  The basic premise of employee empowerment involves the idea that employees are uniquely positioned to identify problems and to solve them. f) Employee Participation/ Involvement:  Employee participation involves management actively encouraging staff to assist in running and improving business processes and operations. g) Trade unions and employee associations:  Trade Unions are formed with the purpose of removing exploitation, harassment at work.  It becomes much easier if decisions are negotiated with a trade union, and employee association that represents them. This saves the management a lot of time because they do not have to see individual employees to discuss problems.

3. Advisory Functions:  

Human resource manager has specialized education and training in managing human resources He is an expert in his area and so can give advice on matters relating to human resources of the organisation. He offers his advise to:

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a) Advise to Top Management: Personnel manager advises the top management in formulation and evaluation of personnel programs, policies and procedures. He also gives advice for achieving and maintaining good human relations and high employee morale. b) Advise to Departmental Heads:Personnel manager offers advice to the heads of various departments on matters such as manpower planning, job analysis and design, recruitment and selection, placement, training, performance appraisal.

 NATURE OF HRM (HUMAN RESOURCES MANAGEMENT) 1. Pervasive force: HRM is pervasive in nature. It is present in all enterprises. It permeates all levels of management in organizations 2. Action oriented: HRM focuses attention on action, rather than on record keeping written procedures or rules. The problems of employees at work are solved through rational policies. 3. Individually oriented: It tries to help employees develop their potential fully. It encourages them to give their best to the organizations. It motivates employees through a systematic process of recruitment, selection, training and development coupled with fair wage policies. 4. People oriented: HRM is all about people at work both as individuals and groups. It tries to put people on assigned jobs in order to produce good results. The resultant gains are used to reward people and motivate them toward further improvements in productivity. 5. Future oriented: Effective HRM helps an organization to meet its goals in the future by providing for competent and well motivated employees. 6. Development oriented: HRM intends to develop the full potential of employees. The reward structure is tuned to the needs of employees. Training is offered to sharpen and improve their skills. Employees are rotated on various jobs so that they gain experience and exposure. Every attempt is made to use their talents fully. 7. Integrating mechanism: HRM tries to build and maintain cordial relations between people working at various levels in the organization. In short it tries to integrate human assets in the best possible manner the service of an organization. 8. Comprehensive functions: This is because, ‘workforce’ signifies people working at various levels, including workers, supervisors, middle and top managers. It is concerned with managing people at work. It covers all types of personnel, at all levels. 9. Auxiliary service: HR departments exist to assist an advice the line or operating managers to do their personnel work more effectively. HR manager is a specified advisor. It is staff function. 10. Inter disciplinary function: HRM is a multi disciplinary activity, utilizing knowledge and inputs drawn from psychology, sociology, economics etc.

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11. Continuous functions: According to Terry, HRM is not a one shot deal. It cannot be practiced only one hour each day or one day a week. It requires a constant alertness and awareness of human relations and their importance in every day operations.  HUMAN RESOURCE MANAGEMENT: SCOPE 1. Personnel aspect- This is concerned with manpower planning, recruitment, selection, placement, transfer, promotion, training and development, layoff and retrenchment, remuneration, incentives, productivity. 2. Welfare aspect-It deals with working conditions and amenities such as canteens, creches, rest and lunch rooms, housing, transport, medical assistance, education, health and safety, recreation facilities. 3. Industrial relations aspect-This covers union-management relations, joint consultation, collective bargaining, grievance and disciplinary procedures, settlement of disputes.  OBJECTIVES OF HUMAN RESOURCE MANAGEMENT 1. Individual Objectives:  To promote team work and team spirit among employees.  Motivates people to work with diligence and commitment.  HRM has the responsibility to acquire, develop, utilize, and maintain employees.  HRM helps employees to achieve their personal goals to get their commitment.  Creating work-life balance for the employees. 2. Functional Objectives:  Functional...