1 Human Resource
Management
Topics Covered
Concept and Functions, characteristics and significance of HRM,
HR Policies, HR Accounting, Changing
Resource Management, Globalization, Environment of Human
Work Force Diversity,
Corporate Downsizing, technological advantages, cultural
environment, changing skill requirements, changing employee
expectations.
CONTENTS
t j Introduction
21 Human Resource Management (HRM) Concept
B Definitions
9 Characteristics/Features/Nature of HRM
J1 Significance/Importance of HRM
(6 HRM Functions/Scope of HRM
[7 Comparative discussion between HRM and
Personnel
Management
* Difference between:Personnel Management and
HRM
M HR Policies
Human Resource Accounting (HRA)
ro] Changing Environment and HRM
[11] Exercise
[] Detailed Questions
[L Short Notes
( Multiple Choice Questions (MCQs)
HRM-SYBBA Sem-3-1
Human Resource Management
2
([1] INTRODUCTION)
organization is a group of people who come together for
An
or mission. These people
the achievement of some specific goalmaterials, information and
machine,
unite various resources like organization may be a
money to achieve their goals. An
non-profitable entity
manufacturing unit or a government body, a who work in these
people
like a school or a hospital. But, it is the succeed or fail in the
organisations that determine whether it will
Hence, people working in an organization are called
long-run. any organization and
human resources. They form the backbone of
goals.
contribute their services to attain organisational
they must be treated
For managing organizations effectively,
of things connected or
as a system. A system is an assembling Organization as a
interrelated so as to form a complex unity.
operation is undertaken in
system operates in its environment. This processing
the form of importing inputs from the environment,
outputs
these inputs to obtain certain outputs, and exporting these
of various
back to the environment. These inputs are in the form characteristics
resources. Allthese resources have distinct nature and
and each one is important for achieving the organizational objectives.
characteristics at
Human resources are the people and their
work either at the national level or the organizational level. Since
toachieve its
an organization performs a number of functions
objectives, it requires human resources of different types which
may be characterized on the basis of functional areas like production,
märketing, finance etc. or the organizational hierarchy or the levels
at which the resources are put. Thus, human resources across the
functional areas may be arranged into top management, middle
management, supervisory management and operatives.
21 HUMAN RESOURCE
MANAGEMENT (HRM) CONCEPT
In this era of globalization, mergers and acquisitions, several
changes are taking place and there is a growing focus on quality
Human Resource Management 3
excellence, flexibility and transformation. Human resources, their
skills, competencies and values are of paramount importance in
adapting (adjusting) to this changing environment. They enable an
organisation to perform better than its competitors. As a result,
management of human resources has become an integral part of
organisational activity and h£s been termed as Human Resource
Management (HRM). HRM has been viewed from two perspectives :
Itis a line function and is every manager's job. It is directly
concerned with those involved in production of goods and services.
2. It is a staff function/support function in an organisation. Its
main role is to assist line managers in smooth functioning of
production/service activity by making policies, procedures, aims,
objectives, instructions and guidelines for the organisation.
The concept of HRM actually has evolved from the term 'Personnel
Management, which is concerned with staffing, developing,
rewarding and motivating employees, but HRM is a wider concept.
It suggests decentralization of responsibilities,adopting participative
approach in management and best utilization of employees for
individual, organisational and social benefit
[3| DEFINITIONS
(1)Guest (1987) "HRM refers to a set of policies, designed
to maximize organisational integration, employee commitment,
flexibility and quality of work. "
(2) Ronald Ebert and Ricky W. Griffin define: "HRM
refers to attracting, developing and maintaining an efective
workforce. "
(3) According to Schermerhorn "HRM is astrategic process
involves 'attracting, developing and maintaining a talented,
energetic workforce to support the organisation s mission, objectives
and strategies. "
(4) Wendel French : Interpreting the term human resource
management, he says, "Human resOurce management means the
fnctions of recruiting, selecting,developing of humanasset bythe
Human Resource Management
well as
maintain theircapacities as
4
institution and to utilize and
provide them amenities. Resource Management is
says, "Human
(5) Edwin B.Flippo directing and controlling of the
organizing, maintenance
the planning, compensation, intergration,
procurement, development, the end that individual
human resources to
and separation of objectives are accomplished."
organizational and social management from the
human resource
By interpreting the that human resource management
above definitions, it can be said also
developed form of personnel management. Hence, it is
is the management. So, human resource
the part of the process of
connected with the process and functions of human
management is element. Therefore, it
relations with human
resource and has close
related with employees ' availability, maintenance and
is considers employees
development. Human resource managementdevelop organizational
maintain and
as human assets. It functions to industrial relations. It stresses on
inter-relations and establish
utilization of its efficiency.
maintaining human assets and maximum
human elements
It is concerned with developing relations amongst
employees, it
and with the help of unity and satisfied groups of
strives to achieve excellent outputs, quality and efYiciency.
[4] CHARACTERISTICS OF
HRM/FEATURES/NATURE OF HRM
The following features and exact nature, scope of HRM
be identified from the above definitions :
1. Apart of Management discipline :
HRM is a part of management discipline. Adiscipline is
accepted science with a theoretical foundation that serves as the
basis for research and analysis. HRM draws a lot from management
concepts, principles and techniques and apply these in the
management of human resources.
2. It is a Sub System :
It is a sub system of a bigger system called the organisation
Human Resource Management
involving every employee and impacting every person in the
organisation. All the activities of the organisation are planned and
carried out by its human resources.
3. Itaims at Human Development
It is aimed at developing human abilities and potential so that
they enable the organisation in achieving its goals,
4. Itconsiders human beings as distinct from other resources :
It focuses on human being as a distinct resource as they can
work individually and in teams to utilize other resources effectívely
and provide a competitive edge to the organisation.
5. HRM as a process :
HRM is just like management process. A process is an
identifiable flow of information through interrelated stages of events
directed towards the achievement of objectives. Thus, a process
consists of several activities and sub-activities. HRM uses 4 basic
processes of management- planning, organizing, directing and
controlling in the area of recruitment, selection, development,
integration and maintenance of people in the organization so as to
achieve its objectives.
6. HRM as a continuous process :
Aprocess is a continuous phenomenon in which events and
relationships are seen as dynamic and flexible. HRM is a continuous
process and not a one-stop action and hence performed on a
continuous basis. It is an ongoing or continuous activity which
involves recruiting employees, training and motivating them
work, building relationships with employees, making policies,
implementing them and solving employee problems. It needs to be
practiced every minute in day to day operations.
7. It is a Human Activity / concerned with
people :
HRM is people oriented activity, It is concerned with people
in the organization both present and potential, It is
not only
concerned with the people presently available in the organization
but also with people having potential to be
brought in the
Human Resource Management
organization. In fact, HRM is the prime tool for bringing people in
the organization -top level, middle level, supervisory management
and operatives / workers. It also aims at providing emplovee.
satisfhction through proper placements, training
8. Directed towards the achievement of objectives :
HRM is a goal oriented activity with a vision to achieve
specific goals in future. It directs and motivates people to work
towards theeffective achievement of the set goals. HRM is directed
towards achievement of objectives by providing tools and techniques
of managing people in the organization effectively. The achievement
of objectives depends largely on the quality of its people and the
way this quality is utilized to get the things done.
9. Universal Existence :
HRM is not confined merely to business organizations but is
relevant to allorganization's activities. It is also relevant to all the
functional areas of a business organization. Every member of the
management group must be an effective human resource manager
because he depends on the cooperative efforts of others.
10. It requires top management support :
Its success is based on the commitment and support from top
level management. The policies and ideologies framed ned sanction
from top management for its implementation.
11. It is interrelated with all other departments :
It is a network which integrates employees, customers,
machines, materials, processes and helps in building and maintaining
cordial relations amongst all.
12. It is not mere record keeping :
HRM is more practical in nature. It believes in forming
employee friendly policies and bringing unity in action and not just
maintaining HR records and regulations.
13. It is multidisciplinary in nature :
It involves the study of various disciplines such as psychology,
sociology and semantics, The principles of understanding and
Human Resource Management
controlling individual behaviour are contributions made from social
psychology , political science, anthropology. Also the problems in
human behaviour are partially solved with the help of medical
science and ergonomics
14. It is globally oriented :
It is a function which applies to all types of
organisations,
whether it is a school, hospital, government body or any corporate
entity.
I5) SIGNIFICANCE/ IMPORTANCE OF HRM
HRM is of vital importance to an organisation as well as any
nation. It helps in the attainment of objectives of any organízation /
nation. The following points highlight its importance in today's
competitive and globalised era.
1. It helps in effective utilisation of human resources by
motivating them towards work and orgánisation and retaining them
in the organisation.
2. HRM helps in developing employees towards the
changing
needs of the organizátion. Thus it ensures a continuous flow of
competent people for accomplishing organisational goals.
3. HRM helps in changing attitudes of employees towards the
organisation and builds employee loyalty.
4. HRM ensures that the dignity of employees at the
is maintained. workplace
5. It provides an environment for developing creativity /new
ideas at the work place.
6. Itprovides proper work environment so that the capabilities
of people are effectively utilised.
7. It is a link between job seekers and job providers and
generates employment opportunities.
Importance of HRM can also be seen in 3contexts:
1. Advantages to the Organization:
HRM is of vital importance to the individual organization as
a means for achieving their objectives. It contributes to the
