Key HR

Functions
SIP Preparation for HRM & LR
Batch of ‘25
 HR Functions

Contents
➢ Talent Acquisition-........................................................................................................................... 2
➢ Training and Development .............................................................................................................. 3
➢ Organization behavior- .................................................................................................................... 5
➢ Organization development-............................................................................................................. 6
➢ Performance Management - ........................................................................................................... 6
➢ Talent management - ...................................................................................................................... 8
➢ Employee engagement- .................................................................................................................. 9
➢ Industrial relations- ......................................................................................................................... 9
➢ Succession planning- ....................................................................................................................... 9
➢ Employee retention- ..................................................................................................................... 10
➢ Total rewards-................................................................................................................................ 11
➢ People analytics ............................................................................................................................ 13
➢ Employer branding ........................................................................................................................ 14
➢ Diversity, Equity, and Inclusion...................................................................................................... 14

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➢ Talent Acquisition-
Talent acquisition (TA) refers to the organizational task of quite simply, finding the right person for
the job, and involves sourcing, attracting, screening, hiring, and onboarding employees.

A process of actively searching and hiring applicants for a job role is known as recruitment. The
primary purpose of recruitment is to attract qualified employees that meet the company's
standards. When a company has an open job, the hiring manager works with the marketing and
other teams to attract potential candidates. Often, recruitment is the primary step in hiring
employees and typically includes:
• Advertising the open job position
• Writing a job description
• Sending emails and messages to qualified candidates
• Determining the job requirements
• Responding to queries about the job
• Reviewing resumes and cover letters of potential applications
• Shortlisting potential candidates for interview

Choosing suitable applicants from the shortlisted candidates is known as selection. During the
selection process, hiring managers use various methods to assess their abilities and skills to ensure
they hire the right individual. Some actions that might occur during the selection process are:
• Administering aptitude tests depending on the job requirement
• Interviewing potential and qualified candidates
• Performing background checks
• Screening candidates based on their resume and cover letter
• Performing background checks

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➢ Training and Development

“Training refers to teaching specific knowledge and skills required in the individual’s present job. The
term development refers to the growth of the individual and preparations for higher-level jobs”-
Kirkpatrick
Training and development is any attempt to improve current or future employee performance by
increasing an employee’s ability to perform through learning, usually by changing the employee’s
attitude or increasing his or her skills and knowledge. The need for training & development is
determined by the employee’s performance deficiency, computed as follows:
Training & Development need = Standard performance – Actual performance.

Training may be viewed as related to immediate changes in organizational effectiveness via

organized instruction, while development is related to the progress of longer-term organizational
and employee goals.
• Training needs analysis (TNA) - TNA is a process to identify the gap between the actual and
the desired knowledge, skills, and abilities (KSAs) in a job. It helps organizations to find out
the gap in terms of skills and training in their existing employees to perform the current and

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upcoming jobs efficiently. The training manager uses the analysis very carefully to design the
right training program to meet the skill and training requirements of the employees to
enhance productively and ultimately achieve the goals and objectives set by the
organization.
A company can choose a combination of training methods to train employees depending
upon which method suits the content material and what works best for the learners. The
most popular methods include on-the-job training, simulators, case studies, roleplay,
classroom training, coaching or mentoring, and technology-based training.

• Learning development model- ADDIE is a learning model used by instructional designers and
training developers to create effective learning experiences. ADDIE is an acronym for a five-
step process: Analysis, Design, Development, Implementation, and Evaluation.

• Training evaluation- Training evaluation refers to an attempt to obtain relevant information

on the effects of a training program. It is considered an essential aspect of a training event

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to be able to reflect, analyze, and improve its effectiveness and efficiency. The primary
objective of evaluating any training program is to develop an understanding of whether it
has achieved its stated objectives. The Kirkpatrick model, also known as Kirkpatrick’s Four
Levels of Training Evaluation, is a key tool for evaluating the efficacy of training within an
organization. This model is globally recognized as one of the most effective evaluations of
training. The Kirkpatrick model consists of 4 levels: Reaction, learning, behavior, and results.

➢ Organization behavior-
“Organisational behavior is a field of study that investigates the impact that individuals, groups, and
structure have on behavior within the organizations to apply such knowledge toward improving an
organization's effectiveness.”—Stephens P. Robbins.

Organizational behavior describes how people interact with one another inside an organization, such
as a business. These interactions subsequently influence how the organization itself behaves and
how well it performs. For businesses, organizational behavior is used to streamline efficiency,
improve productivity, and spark innovation to give firms a competitive edge.

The four elements of organizational behavior are- people, structure, technology, and the external
environment. There are three levels of organizational behavior- the first is the individual level,
which involves organizational psychology and understanding human behavior and incentives. The
second level is groups, which involves social psychology and sociological insights into human
interaction and group dynamics. The top level is the organizational level, where organization theory
and sociology come into play to undertake systems-level analyses and the study of how firms engage
with one another in the marketplace.

The following are types of organizational behaviors models displayed by organizations:

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➢ Organization development-
Organizational development is a planned, systematic change in the values or operations of
employees to create overall growth in a company or organization. It differs from everyday
operations and workflow improvements in that it follows a specific protocol that management
communicates clearly to all employees. The four organizational development interventions are:

• Human Process
• Techno structural
• Strategic Change
• Human Resource Management

Following are some models to guide change in organizations to reach the desired outcome:

1. Lewin’s three-stage model- Proposed by social scientist Kurt Lewin in 1947, the core
components of this model are unfreezing, moving, and refreezing. Unfreezing involves
loosening the structures around the current system or going against the status quo in
preparation for step two. Change is when the organization introduces and implements the
decided changes. Communication with employees during this stage is especially crucial to
facilitate a smooth transition. During the last step — refreezing — the organization has
already integrated the changes. Reinforcement is a significant part of this step. It ensures
that the new policies have become the standard among all employees.

2. Action research model- The action research model follows a continuous eight-step process:
problem identification, consultation with behavioral science experts, data gathering and
preliminary diagnosis, feedback to key clients or groups, joint diagnosis of a problem, joint
action planning, action, and data gathering. After data gathering, the process returns
feedback to key clients or groups and repeats.
3. General Model of Planned Change- Thomas Cummings and Christopher Worley proposed a
general model for planned change. The four steps are: entering and contracting, diagnosis
and feedback, planning and implementation, evaluation, and institutionalization. Because
organizational change is rarely linear and involves overlap and feedback, the process
continues after the final step by returning to a previous one.

➢ Performance Management -
“A strategic and integrated approach to increasing the effectiveness of organizations by improving
the performance of the people who work in them and by developing the capabilities of teams and
individual contributors” - Armstrong and Baron

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‘Performance management involves thinking through various facets of performance, identifying
critical dimensions of performance, planning, reviewing and developing and enhancing performance
and related competencies.’ - Dr. T. V. Rao

Following are some popular performance management tools used to evaluate employees:
1. Management by objectives- Management by objectives (MBO) is the appraisal method
where managers and employees together identify, plan, organize, and communicate
objectives to focus on during a specific appraisal period. After setting clear goals, managers
and subordinates periodically discuss the progress made to control and debate on the
feasibility of achieving those set objectives. This performance appraisal method is used to
match the overarching organizational goals with the objectives of employees effectively
while validating objectives using the SMART method to see if the set objective is specific,
measurable, achievable, realistic, and time-sensitive.

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3. 360-degree feedback- 360-degree feedback is a multidimensional performance appraisal
method that evaluates an employee using feedback collected from the employee’s circle of
influence namely managers, peers, customers, and direct reports. This method will not only
eliminate bias in performance reviews but also offer a clear understanding of an individual’s
competence. The appraisal has 5 components namely: self-appraisals, peer reviews,
manager feedback, customer reviews, and subordinate appraisals.
4. Behaviorally anchored rating scales (BARS)- BARS bring out both the qualitative and
quantitative benefits in a performance appraisal process. BARS compares employee
performance with specific behavioral examples that are anchored to numerical ratings. Each
performance level on a BAR scale is anchored by multiple BARS statements which describe
common behaviors that an employee routinely exhibits. These statements act as a yardstick
to measure an individual’s performance against predetermined standards that are applicable
to their role and job level.
5. Psychological appraisals- Psychological appraisals come in handy to determine the hidden
potential of employees. This method focuses on analyzing an employee’s future
performance rather than their past work. These appraisals are used to analyze seven major
components of an employee’s performance such as interpersonal skills, cognitive abilities,
intellectual traits, leadership skills, personality traits, emotional quotient, and other related
skills.
6. Assessment Center Method- The employees are assessed based on their performance
through social-stimulating exercises like role-playing, decision-making, informal discussions,
etc. The assessment evaluates the performance of employees to identify future leaders and
managers. The effectiveness of the Assessment Center Method allows employees to get a
clear picture of their own performance and how others observe them.

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7. Ranking - Ranking systems list all employees in a designated group from highest to
lowest in order of performance. The primary drawback is that quantifying the
differences in individual performance is difficult and may involve drawing very
narrow— if not meaningless—distinctions.
8. Forced distribution – The ratings of employees in a particular group are disbursed
along a bell curve, with the supervisor allocating a certain percentage of the ratings
within the group to each performance level on the scale. The actual distribution of
employee performance may not resemble a bell curve, so supervisors may be forced to
include some employees at either end of the scale when they would otherwise place
them somewhere in the middle.

9. Continuous performance management- Continuous performance management is a modern,

human-centered approach to promoting, evaluating, and improving employee performance.
It enables your organization to create a trusted environment in which employees feel
empowered to take control of their own development. In a culture of true continuous
performance management, employees support each other with a wide range of real-time
performance feedback – celebratory, instructive, and constructive. The key features of this
strategy are- crowdsourced feedback, continuous check-ins, any-time feedback, setting
priorities, performance dashboards, and performance analytics.

➢ Talent management -
Talent management is the attraction, selection, and retention of employees, which involves a
combination of HR processes across the employee life cycle. The primary purpose of talent
management is to create a motivated workforce who will stay with your company in the long run.
The exact way to achieve this will differ from company to company. It encompasses workforce
planning, employee engagement, learning and development, performance management, recruiting,
onboarding, succession, and retention.

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➢ Employee engagement-
Employee engagement is defined as the emotional investment employees make in their
organizations. It is the passion, involvement, and motivation they bring to work, that they use to
guide their work. Employee engagement is about being included fully as a member of the team,
focussed on clear goals, trusted and empowered, receiving regular and constructive feedback,
supported in developing new skills, and thanked and recognized for achievement. Organizations use
employee engagement theories such as Maslow’s hierarchy, Goal setting theory, and Kahn’s model
of employee engagement as fundamental guides for their policies and actions within the workplace.

➢ Industrial relations-
Industrial relations is that field of study which examines the relationship between the administration
and the employees of an organization at the workplace and gives an instrument to settle down
different industrial disputes. The objective of IR is to safeguard the interest of labor and
management by securing the highest level of mutual understanding and goodwill among all those
sections in the industry which participate in the process of production.
Labor law also known as employment law is the body of laws, administrative rulings, and precedents
that address the legal rights of, and restrictions on, working people and their organizations. As such,
it mediates many aspects of the relationship between trade unions, employers, and employees.
There are two broad categories of labor law. First, collective labor law relates to the tripartite
relationship between employees, employers, and unions. Second, individual labor law concerns
employees’ rights at work and through the work contract.

➢ Succession planning-
Succession planning is the process of identifying the critical positions within your organization and
developing action plans for individuals to assume those positions. The planning process is meant to
create a talent pipeline of successors that will keep the organization running with little to no
interruption when inevitable staff changes occur.

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➢ Employee retention-
Employee retention is a phenomenon where employees choose to stay on with their current
company and don’t actively seek other job prospects. The opposite of retention is turnover, where
employees leave the company for a variety of reasons.
Retention is defined as the process by which a company ensures that its employees don’t quit their
jobs.
“Employee retention is the ability of an organization to retain its best employees and hence maintain
a lower turnover. An organization can achieve this by adopting various employee retention
programs.” - Armstrong

1. The Equity Theory is based on the notion that employees expect equity in rewards, for the
amount of effort they put in. If an employee feels undervalued and has a sense of inequity,
he or she will act toward its restoration by working less. Therefore, efforts to maintain an
inequitable work environment can be the retention strategy employed in such cases.
2. Herzberg's Two-Factor Theory - This theory suggests that there are two sets of factors that
influence job satisfaction and dissatisfaction independently. Hygiene Factors (also called
Dissatisfiers): These are elements in the work environment that, when absent or inadequate,
can lead to job dissatisfaction. However, their presence alone does not lead to significant job
satisfaction. Examples of hygiene factors include:
• Salary and benefits
• Working conditions
• Company Policies
• Job security
• Interpersonal relationships

• Work-life balance

These factors typically were outside the job itself but influenced it. They also include safety on the
job, pay, and overall company environment and policies. Notably, even workplaces with positive
hygiene weren’t enough to be motivating. Mostly, when these factors are bad, they are de-
motivating.
Motivation Factors (also called Satisfiers): These are factors that lead to job satisfaction and intrinsic
motivation. When present and fulfilled, they can lead to increased employee satisfaction and
motivation. Examples of motivation factors include:

• Recognition and appreciation

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• Achievement
• Responsibility
• Advancement opportunities
• Personal and professional growth
• Meaningful and interesting work

These are elements of the job itself or ways that you learn that you’re good and valued at the job.
This means the work is interesting to you and you gain responsibility over time.

➢ Total rewards-
A total rewards strategy is a system implemented by a business that provides monetary, beneficial,
and developmental rewards to employees who achieve specific business goals. The strategy
combines compensation and benefits with personal growth opportunities inside a motivated work
environment.
Fig: World at Work total rewards model

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1. Compensation: the major element of rewards, where most of the technicality and emphasis lies.
Compensation refers to any payment given by an employer to an employee during their period
of employment. In return, the employee will provide their time, labor, and skills. This
compensation can be in the form of a salary, wage, benefits, bonuses, paid leave, pension funds,
stock options, and more.

• CTC = Gross Salary + EPF + Variable Pay

• Gross Salary = Basic Salary + Allowances (HRA, Dearness Allowance, Conveyance Allowance,
leave Travel allowance, etc.)
• Net Salary = Gross Salary – Provident Fund – Professional Tax – Income Tax

2. Benefits: Employee Benefits can be termed as non-cash compensation which is given to the
employee. These benefits are given to the employee apart from salaries and wages. These are also
known as fringe benefits that are offered with the intention to attract and retain employees. These
include:
• Paid leave, sick leaves, and vacation days
• Life insurance
• Health and dental insurance
• Gym memberships or discounts
• Wellness programs
• Childcare benefits
• Employee recognition programs
• Relocation assistance

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3. Work-life Effectiveness: ideally, organizations should strive to support their employees in

achieving success both at work and at home. This can be done through a number of policies and
practices to create a culture of balance in the workplace such as clearly communicating work-life
policies, flexible work timings, sufficient leaves, sabbaticals, etc.

4. Performance Management: it is the alignment between employees' efforts and organizational

objectives. Tools for this element include performance appraisals, 360 feedback, peer review, and
more.

5. Talent Development: a crucial reward element, which plays a profound role in attracting and
retaining young talent especially. Talent development includes career pathing and progression, as
well as equipping the workforce with the skills necessary to prevail.

6. Recognition: largely underutilized reward element. Recognition can be used to recognize

employees for their accomplishments (incl. extraordinary accomplishments). Such programs can be
formal, informal, monetary, or non-monetary.

➢ People analytics
People analytics is collecting and applying organizational, people, and talent data to improve
critical business outcomes. It enables HR departments to gain data-driven insights to make decisions
on different people processes and turn them into actions to drive the performance of an
organization. People analytics is key to practicing evidence-based HR.

The terms people analytics and HR analytics are frequently used interchangeably. However, there is
a difference. HR analytics implies the data is exclusive to Human Resources, while people analytics
goes beyond HR and includes finance, customer, marketing, and other data sources.

There are four types of people analytics, each of which offers different insights.
• Descriptive analytics
What happened? Descriptive analysis (also known as decision analytics) is a basic type of people
analytics that analyzes the patterns in historical data sets to gain insight into what happened.
However, descriptive analysis does not use this data to make future predictions.
• Diagnostic analytics
Why did it happen? Diagnostic analytics takes descriptive analytics a step further and offers an
underlying explanation for the insights revealed in the trends, correlations, and anomalies of the
data.
• Predictive analytics
What will happen? Predictive analytics categorizes past and present data t o determine insights and
then uses an estimating model to predict what might happen in the future.
• Prescriptive analytics
How can we make it happen? Prescriptive analytics is the final step that channels predictive
analytics into decision options and actions to achieve success.

Some common HR metrics - Employee turnover rate, Early turnover, Absenteeism rate, Time to hire,
Cost per hire, Revenue per employee, eNPS, Engagement rating

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➢ Employer branding
Definition -
Employer branding is a strategy that seeks to influence how current employees and the rest of the
larger workforce perceive a company’s brand. While branding in general may target consumers,
employer branding specifically targets a company’s workforce and prospective hires. As a result, it is
a communication approach designed to retain high-performing employees and attract top-ranking
talent.

Value of employer branding

• Healthy company reputation: Win over on-the-fence candidates.
• Strong company culture: Strengthen employee retention.
• Positive brand perception: Entice others to view your brand in a positive light.
• Employer brand savings: Strong employer brand offsets the need for paying employees top
dollar.
• Brand talent acquisition: Draw talent without the need for higher pay.
• Diverse work environment: Attract candidates from various backgrounds.
• Career development journey: Boost your ability to retain top talent for longer.

WHAT IS AN EMPLOYEE VALUE PROPOSITION?

An employee value proposition encompasses all the benefits and rewards that employees receive
when they join a company in return for the skills and experience they bring. While ‘employer value
proposition’ is used in place of ‘employee value proposition,’ the latter is more common when
referring to the offerings candidates and employees can expect from a company.

Here are three companies that we think have nailed employer branding-
Google
Everybody loves Google. Many people dream of working at Google, and this has very little to do with
the compensation and benefits –it's about the perks Google offers to its employees. Google adopted
clever employer branding techniques to create a company people want to work for. For example,
employees get to bring their pets at work; they have free meals; they get generous holidays, and a
commitment to give the partner of a deceased employee 50% of the salary for the next 10 years.
Starbucks
Starbucks builds its employer brand through its employers. The company is active on social media
platforms like Instagram, LinkedIn, and Twitter. It does an excellent job of conversing online with its
current employees and potential candidates. It refers to its employees as partners, and that instantly
makes the employees take pride in the brand and love their jobs. Through the hashtag:
#sbuxjobschat, Starbucks encourages people to contribute their feedback. It also has a presence on
YouTube Channel, where it plays a Jobs Playlist.
Apple
Apple encourages new ways of thinking through diversity. Apple always pushes the envelope to do
the best possible, and that's precisely what reflects in its work culture. That said, it offers amazing
employee perks. Huge discounts on its products and services, parental leave policy, and regular beer
bash parties with celebrity cameos – these flashy perks do shine on Apple's brand reputation.

➢ Diversity, Equity, and Inclusion

DEI stands for Diversity, Equity, and Inclusion in organizations. It refers to the collective set of
practices, policies, and initiatives that companies and institutions implement to create a more
diverse, equitable, and inclusive work environment.

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Diversity: This aspect focuses on ensuring that the workforce is composed of individuals from
different backgrounds, cultures, races, ethnicities, genders, sexual orientations, ages, abilities, and
other dimensions of diversity.
Equity: Equity involves promoting fairness and impartiality in the treatment of all employees,
irrespective of their diverse backgrounds. It entails identifying and addressing any existing disparities
and barriers that prevent certain groups from accessing equal opportunities and resources within
the organization.
Inclusion: Inclusion refers to creating an environment where all employees feel valued, respected,
and empowered to fully participate and contribute. An inclusive workplace fosters a sense of
belonging, ensures that diverse voices are heard, and encourages collaboration among employees
with varied perspectives.

Here are some of the benefits of diverse, equitable, and inclusive environments:

• Financial performance. A study conducted by McKinsey & Company found that ethnically
diverse companies are 35% more likely to have financial returns above their respective
national industry medians. Gender diverse companies are 15% more likely to outperform
their respective national industry medians.
• Employer of choice. According to Glassdoor, 67% of job seekers view a diverse workforce as
an important factor when evaluating companies and considering job offers.
• Innovation and growth. Harvard Business Review found that diverse companies are 70%
likelier to capture a new market. They’re also 45% more likely to report increased market
share year-over-year.
• Increased employee engagement. 83% of millennials report being actively engaged when
they believe their organisation fosters an inclusive workplace culture. That percentage drops
to 60% when their organisation does not foster an inclusive culture. (A Gallup study has
assessed the cost of disengaged employees at up to $350 billion per year in lost
productivity.)
• Powerful decision-making. Diverse teams make better decisions up to 87% of the time,
according to a study conducted by Forbes.

Laws and Legislations in India for Diversity & Inclusion -

Social safeguarding provisions are included in Articles 15 and 16 of the Indian Constitution for all
Indian citizens. Article 15 forbids discrimination based on religion, sex, ethnicity, caste, or origin of
birth. Equal opportunity in matters of public employment (which does not specify the private sector)
is mandatory under Article 16(1). Article 16 (2) ensures that no one is discriminated against for any
position or office under the state based on religion, race, descent, place of birth, caste, sex,
residency, or any combination of these grounds.

Transgender people in India are protected under the constitutional right to change their legal gender
and register as a third gender, per the legislation adopted in 2019. In 2014, transgender people were
legally recognized by the Supreme Court of India as the “third gender.”
Some of India's common dimensions of diversity and related legislation are given below-

1. Gender [The Sexual Harassment of Women at the Workplace (Prevention, Prohibition, and
Redressal) Act, 2013] [section 354 and section 509 of the Indian penal code (Criminal force
to woman with intent to outrage her modesty)]
2. Regional Origin and Language
3. Religion and Ethnicity [The Scheduled Castes and Scheduled Tribes (Prevention of Atrocities)
Act, 1989]
4. Sexual orientation (LGBTQ)

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5. Disability [The Rights of Persons with Disabilities Act, 2016, and the Persons with Disabilities
(Equal Opportunities, Protection of Rights and Full Participation) Act, 1995.]
6. Age and Generation
7. Socio-economic Status

Some Indian companies and their innovative DEI initiatives -

Zomato -

• Zomato has announced paid maternity and paternity leave for all their employees, and also
extended this to non-birthing parents (parents who have adopted children).
• Another slightly controversial policy that they announced was the controversial Period Leave
for all women and transgender employees facing discomfort due to menstruation.

L’oreal -

• Gender pay gap global monitoring (median reduced to 0 in France since 2019)
• Worldwide paid parental leave, including for co-parents (minimum 6 weeks)
• Training all employees on DE&I (more than 75k since 2007, more than 80 learning resources
available)
• Accommodations for employees with disabilities
• Mentoring and integration of refugees in our teams

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