HUMAN RESOURCE

MANAGEMENTManagement function that helps managers recruit,

select, train and develop members for an organization.

CONCEPTS

MANAGEMENT – Accomplishment of organisational objectives by utilizing physical, & financial resources through the efforts of human resources.

RESOURCES - factors of production results in conversion of raw materials into useful goods/services.

Evolution of concept of HR

1. Labour / Manpower – denotes physical abilities & capacities of employees – commodity-wages based on demand & supply

2. Personnel – persons employed in service – employees as a whole

3. HR- denotes resources of all the people who contribute their services to the attainment of organisational goals

Importance of HRM

Organizations – not mere bricks, machines or inventories.

Involves application of management functions. Decisions relating to employees must be

integrated. Decisions made must influence the effectiveness

of organization. Applicable to non business organizations as well.

Importance of HRM HR – most important resource Put other resources to proper use Help transform lifeless factors of production into

useful products Capable of enlargement – produce extraordinary

things when inspired Can help organisation achieve results quickly,

efficiently & effectively.

Objectives of HRM

Personal Functional Organisational Societal

Human Resources –

Acc to Leon C. Megission, “HR is the total knowledge, skills, creative abilities, talents and aptitudes of an organisation’s workforce as well as the values, attitudes and beliefs of the individuals involved.”

Human Resource Management Defined as the art of procuring, developing and

maintaining competent workforce to achieve goals of an organisation in an effective and efficient manner.

Administrative discipline of hiring and developing employees so that they become more valuable to the organization.

It includes (1) conducting job analyses, (2) planning personnel needs, and recruitment, (3) selecting the right people for the job, (4) orienting and training, (5) determining and managing wages and salaries, (6) providing benefits and incentives, (7) appraising performance, (8) resolving disputes, (9) communicating with all employees at all levels.

HUMAN CAPITAL

“Our employees are our greatest assets, and the ability to attract and retain them is the key driver of our future success.”

The human capital can be defined as "the embodiment of productive capacity within people. It is the sum of people’s skills, knowledge, attributes, motivations, and fortitude. It can be given or rented to others, but only on a temporary basis; its ownership is non-transferable.”

Features of HRM

Concerned with employees, both individuals and as a group

Development of HR. covers all levels and all categories – unskilled/skilled/tech/prof/clerical/ managerial

Applies to all types of organisation Continuous process

Aims at attaining the goals of an organisation Responsibility of all line managers and a function

performed by staff managers.

Functions of HRM

A. Managerial Functions:Planning, Organizing, Directing , ControllingB. Operative Functions:Procurement functions, Development functions,

Motivation & compensation, Maintenance, Integration, & Separation.

Planning – Determine the personnel prog regd recruitment, selection, & training to achieve desired objectives.

Organizing – design structure of relationships b/w jobs, personnel and physical factors.

Directing – Getting people to do work willingly & effectively thro supervision and guidance, motivation & leadership.

Controlling – ensure accomplishment of plans correctly- measure performance thro review reports, records etc.

Managerial Functions

Operative Functions1. Procurement Function – concerned with

procuring & employing people with required knowledge, skill and aptitude.

2. Development – Increase of skills, knowledge abilities etc

3. Motivation & compensation – inspire people to give best-through incentives & rewards

4. Integration – of goals thro progs, redressal, negotiations.

5. Maintenance – protecting & preserving physical and psychological health of employees

6. Separation

Procurement Development Motivation & Compensation

Integration Maintenance Separation

Job Analysis Training Job design Grievance redressal Health & safety Retirement

HR Planning Executive development

Work scheduling Discipline Employee welfare Layoff

Recruitment Career planning & development

Motivation Teams & teamwork Social security measures

Outsourcing

Selection Human Resource development

Job evaluation Collective bargaining

Discharge

Placement Performance appraisal

Employee participation & empowerment

Induction & orientation

Compensation administration

Trade unions & associations

Internal Mobility Incentives & benefits.

Industrial relations

OBJECTIVES OF HRM

1. Help the organisation reach its goals

2. Employ the skills & abilities of the workforce efficiently

3. Provide the organisation with well trained & motivated employees

4. Increase to the fullest the employee's job satisfaction & self actualization

5. Develop & maintain a quality of work life

6. Communicate HR policies to all employees.

7. Ethically & socially responsive to the needs of society.

Versions of HRM

Hard versionSoft version

Personnel management

Pigou & Myers A basic management function or activity

permeating all levels of management in any organization.

Jucius – the field of management which has to do with planning, organizing, directing and controlling the functions of procurring, developing, maintaining and utilizing a human resource force, such that the objectives for which the company is established are attained economically & effectively.

Personnel management

Torrington & Hall – A series of activities which first enable working peeople and their employing organizations to agree about the objectives and nature of their working relationships and secondly ensures that the agreement is fulfilled.

Personnel management aims at achieving efficiency and justice.

Functions of Personnel Management

Manpower planning Recruitment Selection Training and development

PERSONNEL MGT HRM

Mgmt of people employed Mgmt of KSA, attititudes..

Man is an economic resource/service exchanged for wage / salary

Man is an economic, social & psychological

Commodity that can be purchased & used

Treated as a valuable resource

Employees are cost centers, mgmt controls cost

Profit centre- invest capital for development & future use

Used organisational benefit Used for organisation, individual & family benefit

Auxiliary function Strategic mgmt function

Human Potential management Latest trend or the third wave of people

management The dictionary meaning of recourse – “something

which can be controlled and manipulated” the superior mental capabilities of humans are not consdered.

Dictionary meaning of “potential” – “capable of coming into being or into action”

This calls for proactive action rather than reactive management.

Main principles of HPM

Belief in self management Human being are not used as a resource but

encouraged to use their potential HPM is and integrative and continuous process to

develop human capabilities and enhance their potential

The focus is on turning employees potential to their own advantage, with the organization benefitting indirectly.

Human resource planning

ConceptThe process including forecasting, developing and

controlling by which a firm ensures that it has the right number and the right kind of people at the right places at the right time doing work for which they are economically most useful.

Activities in HR planning

Forecasting Inventory Anticipating labour shortages Planning

Factors affecting HRP

TimeHorizons

Type & quality Of

Forecasting Info

NatureOfJob

Beingfilled

Outsourcing

Type & strategy Of

organization

Enivrmntluncertainties

Organizational Growth

& cycle

HRP

Planning process

Environmental Scanning

Orgnl objectives and policies

HR needs forecast HR Supply forecast

HRP planning

HRP implementation

Control & Evaluation of programe

Surplus

Shortage

HR Demand forecasting techniques

Flow models

Work studyTechnique

DelphiTechnique

Regression analysis

Managerial judgment

Ratio trend Analysis

HR Demand forecast

Aims of Human Resource planning To be prepared for fresh & increasing

demands Filling the gaps due to attrition &

promotions To face the changes in job requirements To avoid disruptions in business due to

shortage of manpower Lead time for hr activities Understanding the surplus and shortage of

personnel

Objectives of HRP

Utility as a planning and control technique Accurate estimation of required number of

employees Providing the management the

information on the methods of utilization of existing personnel

Matching the HR requirements with the organizational goals

Saving the HR cost Indications on Lead time

Importance of HRP

Future personnel needs Part of strategic planning Creating highly talented personnel International strategies Foundation for personnel functions Increasing investments in HR Resistance to change & move

Job Analysis

The process of collecting information about a job.Done through job description and job specification.Job description – duties, responsibilities, working

conditions & activitiesJob Specifications – employee qualifications –

experience, knowledge, skills or abilities

Data collection methods for JD Observation of job holders while they work Interview of knowledgeable employees Questionnaires and checklists

Worker oriented methods Job oriented methods

Methods of Job analysis

Critical incident method (describe job related behavior)

Task Inventory CODAP (summarizes job analysis rating) – structured, questionnaire

Functional job analysis – functions of job examined in relation to data, people n things

Domain sampling approach – individuals familiar with the job creates list of tasks & KSA’s analyzed

Threshold trait analysis – worker attributes required for performing a task is analyzed – use of job inventory questionnaire.

Threshold traits analysis System

The entire TTAS contains several different pieces. Some pieces are designed for describing traits for selection, some are designed for training, and some are designed for job description (although a TTAS can be used for other purposes as well, including job evaluation).

Job experts determine the level of each of 33 standardized job traits (ability traits & attitude traits).

Technical competence analysis

These traits also are assessed for 6 characteristics: level, practicality, weight, degree, critique and availability as follows:

• Level are trait’ s complexity.• Practicality are estimated proportion of job applicants thought to possess trait indicated.• Degree represents a four grade assessment of a person’s possession of a trait, ranging from unacceptable to superior.• Critique refers to relationship between possession of a trait and job performance.• Availability describe supply / demand ratio of each trait level in labor market.• Weight is an index of the impact of particular trait on job performance.

Recruitment

The process of finding and attracting capable applicants for employment.

Types of recruitment Internal – closed – entry level at the lowest level External - open

Initiating the recruitment processMatters to be considered before initiating the

recruitment process Clarification scope and skill sets Review of job fact sheet or JD. Review of compensation available Analysis of the impact of hiring on the budget.

Factors governing recruitment

External factors Internal factors1. Supply & demand2. Unemployment rate3. Labour market4. Political 5. Social6. Image

1. Recruitment policy2. HRP3. Size of firm4. Cost5. Growth6. Expansion

Sources of Internal recruitment

Internal1. Current employee2. Retired employee3. Former employee

Sources of external recruitment Public notifications Engaging of consultants or headhunters Depending on the database pool or advertising in

company web site Employment exchanges Employee referrals Campus selections Free advertising websites

Internal recruitment

Advantages Disadvantages

1. Less costly2. Candidates already

oriented towards organization.

3. Organizations has better knowledge about the candidates

4. Enhancement of employee morale motivation

5. Good performance is rewarded.

1. Perpetuates the old method of doing things

2. Candidates present role may be affected

3. Politics play a greater role4. Morale problem for those

who are not promoted.

External recruitment

Advantages Disadvantages1. New skills, new

talents and new experience to the organization

2. Compliance with reservation policy becomes easy

3. Scope of internal HR problems are avoided

1. Better morale and motivation chance are lost

2. It is costly3. Chances of creeping

in false positives or false negative error are more

The False Positive Error An organization that makes a false positive error incurs three types of costs. The first type of costs are those incurred while the person is employed. These can be the result of production or profit losses, damaged public relations or company reputation, accidents due to ineptitude or negligence, absenteeism, etc. The second type of costs are those associated with training, transfer, or terminating the employee. Costs of replacing the employee, the third type of cost, include costs of recruiting, selecting, and training a replacement. Generally, the more important the job, the greater the costs of the selection error. The False Negative Error In the case of false negative error, an applicant who would have succeeded is rejected because failure was predicted. Most false negative selection errors go unnoticed, except when the applicant is a member of a protected class and files a discrimination charge. Costs associated with this type of error are generally difficult to estimate. A situation in which the impact of both false positive and false negative selection errors can be detected and measured, however, is in professional sports such as football and basketball. Here, coaches and scouts analyze game films, physical statistics, scouting reports, and other data and decide whether they wish to draft a particular player. If they draft the player and his performance fails to meet expectations, a false positive selection error has occurred. Suppose, however, a team decides against drafting a player and another team chooses the individual. If the player subsequently turns out to be a star, the first team's rejection represents a false negative selection error.

Selection

The process of differentiating between applicants in order to identify those with the greater likelihood of success in job.

Factors affecting selection

External environment- Supply and demand of specific skill- Unemployment rate- Legal & political considerations- Company’s imageInternal environment- Company’s policy- HRP- Cost of hiring

Process of selection

RejectedPreliminary interview

Selection tests

Employment interview

Selection tests

Reference & background

Selection decision

Medical examination

Job offer

Employment contract

Evaluation

Basic testing concepts

Generally tests are to administered to determine the candidate’s

- Ability - Aptitude- Personality- Interest

Factors determining the effectivenessof test Reliability Validity

Types of tests

Mental ability test – intelligence, numerical skills & comprehension

Work samples – motor & verbal skills Trainability test Personality & general interest tests

Selection testsTests Description

Thomas Profiling Identifying the behavioral requirement of the job – 25 options of check list in which the employees are supposed to choose the behavioral pattern to which they resemble.

MBTI The Myers-Briggs Type Indicator (MBTI) assessment is a psychometric questionnaire designed to measure psychological preferences in how people perceive the world and make decisions.

PAPI – Personality & preference inventory

A personality measure which was specifically designed to elicit behaviours and preferences which are appropriate to the workplace. It is an applied, workplace instrument and this is reflected by the conceptual model of personality it seeks to measure. - It is based on Murray’s “Need Press theory”.

Tests16 PF- Measuring personality facors- derived using factor-analysis by psychologist

Raymond Cattell - Factor analysis - Factor analysis is a

statistical method used to describe variability among observed, correlated variables in terms of a potentially lower number of unobserved, uncorrelated variables called factors

- A questionnaire containing the 16 personality factors

- Primary & Secondary/global factors

Tests

ASUFA

ASUFA inventory refers to Attributing Success or Failures.It is developed by the efforts of Dr. Udai Pareek . ASUFA revolves around concept of the Locus of Control , Attribution & Emotional intelligence.

Locus of control is a theory in personality psychology referring to the extent to which individuals believe that they can control events that affect them

Interviews

Formal, in depth conversation conducted to evaluate the applicant’s acceptability.

Adapted to unskilled, skilled, managerial & professional employees.

2 way exchange of information, the interviews learnt about the applicant and the applicant learnt about the organization.

Short comings of interviews Absence of reliability

Lack of validity

Biases

Types of interviews

One to one interview

Sequential interview

Panel interview

Objectives of interview

Helps in obtaining additional information from applicant

Facilitates giving general information to the applicants

Helps to build the image of the organisation

Classifications of interview

Structured Semi-structured Unstructured Stress

Reference

From former bossed, co-workers or frineds Letters of recommendations

Induction & placement

The process of familiarizing the employee with his new work.

- Terms & conditions- May be brief or elaborate

Placement – the positioning of the employee in the job to which he is best suited.

Effecting a fit between employee competency and job requirements.

Promotion & transfer

Demotion