Human Resource Management:

We often hear the term Human Resource Management, Employee Relations and Personnel
Management used in the popular press as well as by Industry experts. Whenever we hear these
terms, we conjure images of efficient managers busily going about their work in glitzy offices.

In this article, we look at the question “What is Human Resource Management?” by giving a
broad overview of the topic and introducing the readers to the practice of HRM in contemporary
organizations. Though as with all popular perceptions, the above imagery has some validity, the
fact remains that there is much more to the field of HRM and despite popular depictions of the
same, the “art and science” of HRM is indeed complex. We have chosen the term “art and
science” as HRM is both the art of managing people by recourse to creative and innovative
approaches; it is a science as well because of the precision and rigorous application of theory
that is required.

As outlined above, the process of defining HRM leads us to two different definitions. The first
definition of HRM is that it is the process of managing people in organizations in a structured
and thorough manner. This covers the fields of staffing (hiring people), retention of people, pay
and perks setting and management, performance management, change management and
taking care of exits from the company to round off the activities. This is the traditional definition
of HRM which leads some experts to define it as a modern version of the Personnel
Management function that was used earlier.

The second definition of HRM encompasses the management of people in organizations from a
macro perspective i.e. managing people in the form of a collective relationship between
management and employees. This approach focuses on the objectives and outcomes of the
HRM function. What this means is that the HR function in contemporary organizations is
concerned with the notions of people enabling, people development and a focus on making the
“employment relationship” fulfilling for both the management and employees.

These definitions emphasize the difference between Personnel Management as defined in the
second paragraph and human resource management as described in the third paragraph. To
put it in one sentence, personnel management is essentially “workforce” centered whereas
human resource management is “resource” centered. The key difference is HRM in recent times
is about fulfilling management objectives of providing and deploying people and a greater
emphasis on planning, monitoring and control.

Whatever the definition we use the answer to the question as to “what is HRM?” is that it is all
about people in organizations. No wonder that some MNC’s (Multinationals) call the HR
managers as People Managers, People Enablers and the practice as people management. In
the 21st century organizations, the HR manager or the people manager is no longer seen as
someone who takes care of the activities described in the traditional way. In fact, most
organizations have different departments dealing with Staffing, Payroll, and Retention etc.
Instead, the HR manager is responsible for managing employee expectations vis-à-vis the
management objectives and reconciling both to ensure employee fulfillment and realization of
management objectives.
In conclusion, this article has briefly touched upon the topic of HRM and served as an
introduction to HRM. We shall touch upon the other topics that this field covers in other articles.

Following are the important concepts of Human Resource Management:

Importance of HRM for Organizational Success:

The practice of HRM must be viewed through the prism of overall strategic goals for the
organization instead of a standalone tint that takes a unit based or a micro approach. The idea
here is to adopt a holistic perspective towards HRM that ensures that there are no piecemeal
strategies and the HRM policy enmeshes itself fully with those of the organizational goals. For
instance, if the training needs of the employees are simply met with perfunctory trainings on
omnibus topics, the firm stands to lose not only from the time that the employees spend in
training but also a loss of direction. Hence, the organization that takes its HRM policies seriously
will ensure that training is based on focused and topical methods.

In conclusion, the practice of HRM needs to be integrated with the overall strategy to ensure
effective use of people and provide better returns to the organizations in terms of ROI (Return
on Investment) for every rupee or dollar spent on them. Unless the HRM practice is designed in
this way, the firms stand to lose from not utilizing people fully. And this does not bode well for
the success of the organization.
Scope of Human Resource Management:

Human resources are undoubtedly the key resources in an organization, the easiest and the most difficult
to manage! The objectives of the HRM span right from the manpower needs assessment to management
and retention of the same. To this effect Human resource management is responsible for effective
designing and implementation of various policies, procedures and programs. It is all about developing and
managing knowledge, skills, creativity, aptitude and talent and using them optimally.

Human Resource Management is not just limited to manage and optimally exploit human intellect. It also
focuses on managing physical and emotional capital of employees. Considering the intricacies involved,
the scope of HRM is widening with every passing day. It covers but is not limited to HR planning, hiring
(recruitment and selection), training and development, payroll management, rewards and recognitions,
Industrial relations, grievance handling, legal procedures etc. In other words, we can say that it’s about
developing and managing harmonious relationships at workplace and striking a balance between
organizational goals and individual goals.

The scope of HRM is extensive and far-reaching. Therefore, it is very difficult to define it concisely.
However, we may classify the same under following heads:

 HRM in Personnel Management: This is typically direct manpower management that involves
manpower planning, hiring (recruitment and selection), training and development, induction and
orientation, transfer, promotion, compensation, layoff and retrenchment, employee productivity.
The overall objective here is to ascertain individual growth, development and effectiveness which
indirectly contribute to organizational development.

It also includes performance appraisal, developing new skills, disbursement of wages, incentives,
allowances, traveling policies and procedures and other related courses of actions.

 HRM in Employee Welfare: This particular aspect of HRM deals with working conditions and
amenities at workplace. This includes a wide array of responsibilities and services such as safety
services, health services, welfare funds, social security and medical services. It also covers
appointment of safety officers, making the environment worth working, eliminating workplace
hazards, support by top management, job safety, safeguarding machinery, cleanliness, proper
ventilation and lighting, sanitation, medical care, sickness benefits, employment injury benefits,
personal injury benefits, maternity benefits, unemployment benefits and family benefits.

It also relates to supervision, employee counseling, establishing harmonious relationships with

employees, education and training. Employee welfare is about determining employees’ real
needs and fulfilling them with active participation of both management and employees. In addition
 to this, it also takes care of canteen facilities, crèches, rest and lunch rooms, housing, transport,
medical assistance, education, health and safety, recreation facilities, etc.

 HRM in Industrial Relations: Since it is a highly sensitive area, it needs careful interactions with
labor or employee unions, addressing their grievances and settling the disputes effectively in
order to maintain peace and harmony in the organization. It is the art and science of
understanding the employment (union-management) relations, joint consultation, disciplinary
procedures, solving problems with mutual efforts, understanding human behavior and maintaining
work relations, collective bargaining and settlement of disputes.

The main aim is to safeguarding the interest of employees by securing the highest level of
understanding to the extent that does not leave a negative impact on organization. It is about
establishing, growing and promoting industrial democracy to safeguard the interests of both
employees and management.

The scope of HRM is extremely wide, thus, can not be written concisely. However, for the sake of
convenience and developing understanding about the subject, we divide it in three categories mentioned
above.