HUMAN RESOURCE MANAGEMENT

(MGMT 312)

CREDIT HOUR: 3

Degree Program
SIDIST KILO BRANCH

AA Ethiopia
COURSE CONTENT
Chapter-One: Introduction to Human Resource

Management Chapter-Two: Human Resource

Management Environments Chapter-Three: Job

Analysis and Human Resource Planning

Chapter-Four: Recruitment and Selection

Chapter-Five: TRAING

andDevelopment

Chapter-Six: Performance

Appraisal Chapter-Seven:

Compensation

Chapter-Eight: Integration and Maintenance

Chapter-Nine: Promotions, Transfers and

Separation

Chapter-Ten: Sexual Harassment in Work Place, E- Human Resource Management

and Empowerment
Course Objectives

The basic objective of this course is to help students acquainted with the
fundamental principles, concepts and practices of the different human resource
functions and examine the different theories which try to explain the
relationship between HRM and organizational performance.

At the end of this course students will be able to:

 Describe the relationship between HRM and organizational performance,

 Critically evaluate alternative perspectives on HR practices,

 Gain an insight about the operative functions of personnel management

 Understand the importance and significance of human resource as an asset
 Acquire a broader perspective on managing human resource effectively
 Equip students with a realistic over view of major principles and
techniques of human resource management system
 Understand the dynamic nature and applications of human resource
management in business and other organizations
 Make students be aware of the environmental influence experiencing
human resource and how to deal with these factors
 Conduct human resource functions effectively and efficiently
 Understand newly emerging issues of Human resource like
diversity and its management, empowerment, HIV/ AIDS and the
workplace
 CHAPTER ONE
INTRODUCTION TO HUMAN RESOURCE MANAGEMENT

Introduction
Dear learner, one of the problems in teaching personnel management is how to call
it and how to define it. Some terms that have been used are: personnel, the
personnel function, manpower
management, personnel administration, industrial relations, employee relations, human
resources
administration, personnel and human resources administration, personnel and
industrial relations (PAIR), and personnel management. Personnel management is
defined for this module as: the performance of all managerial functions involved in
planning for, recruiting, selecting, developing, utilizing, rewarding, and maximizing
the potential of the human resources of an organization. According to this definition,
all managers, at all levels, in all organizations, perform the personnel function. That is
the only way there can be a logical, unified, and meaningful, yet broad and complete
personnel program. Personnel managers may be assigned the duty of coordinating
specific personnel programs and functions. But this does not relieve the other
managers of their duty to perform personnel functions. This chapter mainly focuses
on the conceptual perspective of human
resource management.
Objectives
At the end of this chapter you should be able to:
 Define Human resource management;
 Reason out why human resource management learnt;
 Explain nature of personnel/human resource management;
 List importance of human resource management;
 List objectives of human resource management;

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1.1. Definitions and Meaning of Human Resource Management
Dear learner, could you define what human resource management means?

Every organization whether small or big; governmental or non-governmental;

manufacturing or service need for their existence both physical and human resource.
Therefore, management students should able to know about human resource
management issues. All issues related with human resource will be addressed in this
course. Organizations have to provide a healthy work climate in
order to get the best out of people. To utilize the capabilities of people fully, you
need competent leadership willing to recognize, reward and nurture talent at all
levels. This is where human resource managers play a critical role by bridging gaps
between employee expectations and organizational requirements by adopting
appropriate human resource strategies and practices.
! Human Resource Management, usually abbreviated as HRM has been defined by
different authors differently. Some of the definitions are explained below:
1) HRM, in short, is the art of procuring, developing and maintaining competent
workforce to achieve the goals of an organization in an effective and efficient
manner.
2) Human Resource Management (HRM) is a strategic, integrated and coherent

approach to the employment, development and well-being of the people working in

organizations.
3) Human Resource Management involves all management decisions and action

that affect the nature of the relationship between the organization and its employees –
its human resources (Beer et al, 1984.)
4) HRM comprises a set of policies designed to maximize organizational integration,

employee commitment, flexibility and quality of work (Guest, 1987).

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5) HRM is a distinctive approach to employment management which seeks to achieve

competitive advantage through the strategic deployment of a highly committed and

capable workforce, using an integrated array of cultural, structural and personnel
techniques (Storey, 1995).
6) HRM is: ‘The management of work and people towards desired ends.’ (Boxall etal, 2007)
7) HRM is concerned with how organizations manage their workforce (Grimshaw

and Rubery, 2007).

1.1Meaning of Human Resource Management

1) HRM is a management function that helps organisation to recruit, select, train,
develop and
manage its members. Simply stated, HRM is all about management of people in the
organisation
from Recruitment to Retirement. HRM refers to set of programs, functions, and
activities designed and carried out in order to maximise both employee as well as
organisational effectiveness.
2) “HRM is concerned with the people dimensions in management. Since every

organization is made up of people, acquiring their services, developing their skills,

motivating them to higher levels of performance and ensuring that they continue to
maintain their commitment to the organization are essential to achieving
organizational objectives. This is true, regardless of the type of the organization –
government, business, education, health, recreational, or social action.”

1.1.1. The Human Resource Management Process

Change is the one constant in the work force. Effective management promoted or
leaves for better positions elsewhere; ineffective managers are demoted or even fired.
Furthermore, the company may need more or fewer employees and managers from
time to time. Thus, the HRM process never stops. Rather, it is an ongoing procedure
that tries to keep the organization supplied with the right people in the right positions
at the right time. The HRM process, as shown in the following figure, includes seven
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basic activities:
1. Human resource planning designed to ensure that personnel will need
constantly and appropriately accomplished through analysis of
(a) Internal factors, such as current and expected skill needs, vacancies and

departmental expansions and reductions; and

(b) Factors in the external environment, such as the labor market. The use of

computers to build and maintain information about all employees has enabled
organizations to be much more efficient in their planning of human resources.
2. Recruitment is concerned with developing a pool of job candidates in line with
the human resource plan. Candidates are usually located through newspaper and
professional journal advertisements, employment agencies, word of mouth, and
visits to college and university campuses.

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 Human resource Recruitment Selection
planning

Training and development Socialization

Promotions, Transfers, Demotions,

Performance Appraisal and separations

Figure 1.1. HRM process

3. Selection involves using application forms, resumes, interviews, employment

skills tests, and reference checks to evaluate and screen job candidates for the
managers who will ultimately select and hire a candidate.
4. Socialization is designed to help the selected individuals to fit smoothly into the
organization. Newcomers are introduced to their colleagues, acquainted with their
responsibilities, and informed about the organization's goals, policies, and
expectations regarding employee behavior.
5. Training and development aim to increase employees' ability to contribute to
organizational effectiveness. Training is designed to improve skills in the present
job; development programs are designed to prepare employees for promotion.
6. Performance appraisal compares an individual's job performance to standards or
objectives developed for the individual's position. Low performance may prompt
corrective action, such as additional training, a demotion, or separation, while
high performance may merit a bonus or promotion. Although an employee's
immediate supervisor will perform the appraisal, the HRM department is
responsible for working with upper management to establish the policies that
guide all performance appraisals.
7. Promotions, transfers, demotions, and separations reflect an employee's value
to the organization. High performers may be promoted or transferred to help them
develop their skills, while low performers may be demoted, transferred to less
important positions, or even separated. Any of these options will, in turn, affect

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 human resource planning.

1.2. Importance of Human Resource Management

Dear student, could you mention few importance of HRM?

Despite that Human Resource Management (HRM) is used within this teaching
material; the more traditional terms are still widely used in many of Ethiopia’s
organizations. For example, the terms Personnel Department, Personnel Director or
just personnel are extensively used and respected.
! Changes in terminology suggest the increased importance associated with the
management of people in organizations as well as the broader aspects from which the
field is currently viewed. In the past, personnel management had a strong functional
focus. In the past personnel offices were primarily concerned with the administration
of specific employee-related functions like hiring, training, wage-setting, and
disciplinary action. A more modern view is that all personnel functions are
interrelated; each function affects the others. Moreover, how well these functions are
managed has a tremendous effect on an organization’s ability to meet its overall
objectives. As these ideas have become more and more accepted in the Western
World, the view of “people management” has changed accordingly. It is now
generally accepted that human resources management calls for a dynamic,
organization-wide perspective that is action-oriented and based on theory from many
disciplines, including the study of human behavior.

Human Resource Management has a place of great importance. According to Peter F.

Drucker,
―The proper or improper use of the different factors of production depends on the
wishes of the human resources. Hence, besides other resources human resources need
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more development. Human resources can increase cooperation but it needs proper
and efficient management to guide it. Importance of personnel management is in
reality the importance of labor functions of personnel department which are
indispensable to the management activity itself.
! Because of the following reasons human resource management holds a place of
importance.

1. It helps management in the preparation adoption and continuing evolution

of personnel programmes and policies.

2. It supplies skilled workers through scientific selection process.

3. It ensures maximum benefit out of the expenditure on training and development

and appreciates the human assets.

4. It prepares workers according to the changing needs of industry and environment.
5. It motivates workers and upgrades them so as to enable them to accomplish the

organization goals.
6. Through innovation and experimentation in the fields of personnel, it helps in

reducing costs and helps in increasing productivity.

7. It contributes a lot in restoring the industrial harmony and healthy employer-employee
relations.
8. It establishes mechanism for the administration of personnel services that are

delegated to the personnel department.

Thus, the role of human resource management is very important in an organization
and it should not be undermined especially in large scale enterprises. It is the key to
the whole organization and related to all other activities of the management i.e.,
marketing, production, finance etc.
Human Resource Management is concerned with the managing people as an
organizational resource rather than as factors of production. It involves a system to be
followed in business firm to recruit, select, hire, train and develop human assets. It is
concerned with the people dimension of an organization. The attainment of
organizational objectives depends, to a great extent, on the way in which people are
recruited, developed and utilized by the management. Therefore, proper coordination
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of human efforts and effective utilization of human and others material resources is
necessary.
 Activity 1

1. Define human resource management and elaborate its importance?

2. Why do we study human resource management?

1.3. Evolution and Development of Human Resource Management

Modern personnel management dates back to the 1940’s. Yet, personnel problems
that need managerial attention date back to the time of the industrial revolution. The
practitioner in modern personnel management requires being equipped with such
broad fields in:
 psychology
 sociology philosophy
 economics and
 management
Taking good lectures, reading many materials in the discipline indicated above may
not enable one to be a good manager. The study and readings will help, but attending
to current problems, awareness of such needs are important.

As a manager, one exercises authority and leadership over other personnel. The
personnel manager is one who performs the basic functions of management.
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! Accordingly, the field of personnel management has both the managerial and the
operative functions as in the following:
 Managerial functions include:
 planning
 organizing
 directing and
 controlling
 Operative functions include:
 recruitment
 selection
 development
 performance appraisal
 compensation
 integration
 separation

1.3.1. Transfer of Personnel Management to Human Resource Management

As the field of management got more and more matured, emphasis was given to
organizing workers for the work. Workers got more demanding in what they wanted
from the work. These continued demands of workers led to setting and revising laws,
legislations and policies. Thus, organizations were to hire the best-qualified candidate
irrespective of sex, religion, etc.

The individuals so hired were required to be trained and effective working conditions
were also to be productive. Accordingly, authorities in HRM of the following period
proposed that some of the following areas be covered in the field.
 Job design
 Definition and background of HRM
 Environmental considerations in HRM
 Human resources planning (HRP) including job analysis, etc
 Recruitment
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 Selection
 Orientation
 The development of HR to include
 Leadership
 Discipline
 Training
 Performance appraisal
 Motivation
 Compensation /Benefits
 Maintenan
 Labor relations
ce

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! As conditions changed in the managerial development, the term personnel is
different from human resource in that personnel is limited to employees of an
organization; while human resource includes the sum total of all of the components
(like skills, and/or creative ability of all people:
 employed
 self – employed
 employers
 owners
These are all those people who are expected to make contributions to the attainment
of organizational goals as well as those who are causing bureaucratic conspiracy.
Human resource does also refer to the human values, ethos, etc. belief, culture,
ethics, ideology, preceding attitudes.

1.4. Human Resource Management Objectives

Could you guess what the objectives of Human Resource Management are?

The overall purpose of human resource management is to ensure that the

organization is able to achieve success through people. HRM aims to increase
organizational effectiveness and capability – the capacity of an organization to
achieve its goals by making the best use of the resources available to it. Ulrich and
Lake (1990) remarked that: ‘HRM systems can be the source of organizational
capabilities that allow firms to learn and capitalize on new opportunities.’ But HRM
has an ethical dimension which means that it must also be concerned with the rights
and needs of people in organizations through the exercise of social responsibility.

Dyer and Holder (1998) analysed management’s HR goals under the headings of:
 Contribution (What kind of employee behaviour is expected?),

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  Composition (what headcount, staffing ratio and skill mix?),
 Competence (what general level of ability is desired?) and
 Commitment (what level of employee attachment and identification?).
! Generally, HRM has the following objectives:

1) Organizational Objectives: To assist the organization to achieve its primary

objectives, whether it is profit making or charity or social agenda. To ensure that

the organization is able to achieve success through people
2) Societal Objectives: To be responsive to the needs and challenges of the society

while minimizing the negative impact, if any, of such demands upon the organization.
To be concerned with the rights and needs of people in organizations through the
exercise of social responsibility
3) Functional Objectives: To maintain department’s contribution and level of

services at a level appropriate to the organization’s needs.

4) Personal Objectives: To assist employees in achieving their personal goals, at

least in so far as these goals enhance the individual’s contribution to the

organization. This is necessary to maintain employee performance and satisfaction
for the purpose of maintaining, retaining and motivating the employees in the
organization.

 Activity 2

1. Why the term personnel management transferred to Human resource management?

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2. List and explain the four major objectives of Human Resource management?

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