Human Resource Management definitely has a much broader scope than personnel management at the component level as well as in coverage at the organisational level.

HRM is a very important approach to the management of people at different levels. In other words, it refers to a set of programmes, functions, activities, and so on, designed and carried out for maximising effectiveness of employees as well as the organisation.

Learn about:-

1. Evolution of Human Resource Management 2. Phases of Growth in HRM over the Years 3. Scope  4. Objectives 5. Nature 6. Features 7. Functions


8. Importance 9. Factors Influencing 10. HRM in Various Sectors. 11. Activities 12. Career 13. Role of HR Manager 14. Ethics 15. Policies 16. Line and Staff Aspect

17. Complexities of HRM to Ensure Sustained Competitive Advantage 18. Impact of Technology  19. New Trends 20. Some Recent Studies in the Field of HRM 21. Limitations.

Human Resource Management: Evolution, Phases, Scope, Objectives, Nature, Functions, Importance, New Trends and Limitations

Human Resource Management – Evolution

The development of personnel management in U.K. and USA was largely voluntary. But in India, it emerged because of governmental interventions and compulsions. In the beginning of 20th Century, various malpractices in the recruitment of workers and payment of wages were prevalent which caused a colossal loss in production due to industrial disputes.

The Royal Commission on Labour in India (1931) under the Chairmanship of J.H. Whitley recommended the abolition of the ‘Jobber’ system and the appointment of labour officers in industrial enterprises to perform the recruitment function as well as to look after the welfare of the employees. After independence, the labour welfare officer was identified with the personnel manager created by legislation under Section 49 of the Factories Act., 1849. Evolving along the years, a new approach the human resource management has emerged.


Concern with the management of manpower or human resources has engaged the attention of social scientists, economists, researchers, executives as well as management thinkers since the early 19th century till the modern times. Robert Owen (1771-1858), who successfully managed one of the largest spinning wills in Scotland, introduced and later on initiated a reformist movement for the improvement of the workers’ conditions. He aimed at making the spinning mill, which he managed for more than 25 years, not merely an efficient factory, but a well-governed human community, based on good living.

In his mill employees were given all the benefits. It was his duty to ensure them all the means of good living to pay good wages to avoid unreasonably long hours of work, to provide good houses and good food and clothing and reasonable prices, to make the factory village a sanitary and pleasant place and, above all, to ensure to the children, whether employed in the factory or not, the best education that sympathy and knowledge could place at their command.

In-spite of the reformist zeal of owner, however, the impact of the workers cause, which he upheld, was not binding except for the enactment of factory legislation for the protection of workers and the trade union movement which were inspired by him.

Although Charles Babbage and Henry Towde, after Robert Owen, contributed towards the formulation of a science of management, and also considered matters relevant to man-management, it was Frederick Taylor who pioneered the introduction of scientific methods in management more consistently than others. The ideas of Taylor and his associates were founded essentially on the principle of specialisation through division of work.


Taylor not only proposed that work be divided into simple routine and repetitive tasks so as to utilise minimum skills and abilities of workmen. He was also in favour of specialisation of managerial jobs, along-with standardisation of working conditions, machines and tools. To quote, “each man from the assistant superintendent down shall have as few functions as possible to perform (and) if practicable, the work of each man in the management should be confined to the performance of a single leading function”.

Taylor also introduced, and his associates (Gantt, Frank and Lillian Gilberth, Cooke and Emerson) refined, the incentive schemes of wage payment to bring about correspondence between efficiency and compensation. Taylor’s ideas were widely accepted and practised in the Unites States and Western Europe. However, Taylorism met with strong criticism with the emergence of the Human Relations School and the behavioural approach to the problems of Human Resource Management.

“The gravest weakness (of specialisation)”, James Worthy observed, “was the failure of recognise and utilize property management’s most valuable resources, the complex and multiple capacities of people. On the contrary, the scientific managers deliberately sought to utilise as narrow a band of personality and as narrow a range of ability as ingenuity could devise. The process has been fantastically wasteful for industry and society”.

It was, thus, contended that the fragmentation and routinisation of work to the point where it loses significance has dire implications. The organisation may suffer because the rewards for submissive compliances produce apathy, indifference, non-involvement, and alienation on the part of workers. They become highly dependent and incapable of solving problems and making decisions. The organisation may become rigid and its members unwilling to accept and adapt to changes necessary for growth and changing socio-economic conditions.

In the work of Taylor’s principles of scientific management, other classical writers, including Mooney and Reiley, Max Weber, Gullick and Urwick, emphasised the significance of the structure of organisation and the span of management to be essential for effective supervision, management and control.

They also emphasised the importance of the formal organisation, based on grouping of similar activities, followings revealed that the grouping of persons according to similarities in their work may be contrary to the natural development of human organisation for people often tend naturally to organise on a basis other than the technical requirements of work.

They may organise in terms of sentiments, social customs, and codes of behaviour, status, friendships, and cliques. In other words, co-operation may flow more in terms of the natural relationship of informal organisation and not necessarily on groupings based on work arrangements and/or economic incentives.

Thus, an organisation may function best and the members highly motivated when people in the organisation hold overlapping group membership. A restricted span of control, postulated by classical management thinkers, has been pointed out as a source of contradiction with the principle that there should be few levels in the managerial hierarchy so as to reduce the administrative distance between the individuals and, thus, to reduce red tape, waste of time and efforts. A narrow span inevitably leads to an increase in the number of levels of management for a growing concern.

The implicit assumption of the classical approach to manpower management was that the ability of the individual corresponds to the formal authority of the function. In other words, it was assumed that authority tends to equal the capacity of the people actually performing organisational function. A rational programme of personnel administration was expected to promote the tendency on a closer examination.


This proposition was found to defend upon the sufficiency of administrative information regarding the job content and individual capacities. The neo classical thinking questioned the proposition on two grounds. They feel that the individual capacity could not be assessed easily and it was difficult to bring about a proper match between individual ability and career opportunities in the organisation.

Moreover, the logic of formal relationships was not the only logic prevailing in human organisations. The system of power network of influence and the decision making processes were after known to be at variance with the system prescribed by the formal authority structure.

Human Resource ManagementPhases of Growth

1. Early Phase:

a. Coming to the evolution of HRM as a subject, it may be stated that concern for the welfare of the workers in the management of business enterprise has been in existence from time immemorial.

b. There existed a sound base for systematic management of resources during as early as 4th century BC. The govt., then took an active interest in the operations of public and private sector enterprises. Elsewhere, the minimum wage rate and incentives wage plans were included in the Babylonian code of Hammurabi around 1800 BC.


c. The Chinese in 1650 BC, originated the principle of division of labour and they understood labour turnover even in 400 BC. The span of management and related concepts of organisation were well understood by Moses around 1250 BC and Chaldeans had incentive wage plans around 400 BC.

2. Legal Phase:

a. The early roots of HRM in India could be traced back to 1920s. The Royal Commission on labour recommended in 1931 the appointment of labour officers in order to protect the workers from the evils of jobbery and indebtedness, to check corrupt practices in recruitment and selection in Indian industry, to act as a spokesman of labour.

b. After Independence, the Factories Act, 1948 made it mandatory for factories employing 500 or more workers to appoint welfare officers. The act also prescribed the qualifications and duties of welfare officers.

c. Two professional bodies viz. the Indian Institute of Personnel Management (11 PM), Calcutta and National Institute of Labour Management (NILM), Mumbai were established during the 1950s.

3. Welfare Phase:


a. During the 1960s, the personnel function began to expand beyond the welfare aspect, with labour welfare, industrial relations and human resource administration integrating into the emerging profession called personnel management.

b. Rapid industrialisation and the opening of public sector during the five year plans accelerated the growth of human resource management and professionalization of management.

4. Development Phase:

a. In the 1970s concern for welfare shifted towards higher efficiency. Changes in professional values of human resource manager are visible.

b. During the 1980s, due to new technology and other environmental changes, human resource developments (HRD) become a major issue. Two professional bodies IIPN and NILM were merged to form National Institute of Personnel Management (NIPM) at Kolkata.

c. In the 1990s, the emphasis shifted to human values and productivity through people. Reflecting this trend, the American Society for Personnel Administration (ASPA) was renamed as the society of Human Resource Management (SHRM). Thus, beginning in 1920s, the subject of HRM has grown into the matured profession.

Growth of personnel HRM in India had to pass through various phases to reach at the development phase.

Human Resource Management – Scope


1. Human resource or manpower planning, i.e. determining the number, and kinds of personnel requirement to fill various positions in the organisations.

2. Recruitment, selection and placement of personnel is employment function.

3. Training and development of employees for their efficient performance and growth.

4. Appraisal of performance of employees and taking corrective steps such as transfer from one job to another.

5. Motivation of workforce by providing financial incentives and avenues of promotion.

6. Remuneration of employees. The employees must be given sufficient wages and fringe benefits to achieve higher standard of living and to motivate them to show higher productivity.


7. Social security and welfare of employees.

8. Review and audit of personnel policies, procedures and practices of the organisation.

The Indian Institute of Personnel Management has described the scope of human resource management into following aspects:

1. The Labour or Human Resource Aspect – It is concerned with manpower planning, recruitment, selection, transfer, planning, induction, promotion, placement, training and development, productivity, remuneration etc.

2. The Welfare Aspect – This aspect is concerned with working conditions and amenities such as canteens, crèches, rest rooms, housing, transport, education, medical help, health and safety, recreation and cultural facilities.

3. The Industrial Relations Aspect – This is concerned with the company’s relations with the employees. It includes union-management relations, joint consultation, negotiating, collective bargaining, grievance handling, disciplinary actions etc.

Human Resource Management – 4 Major Objectives

According to Scott Clothier and Spriegal, “The objectives of HRM in an organisation, is to obtain maximum individual development, desirable working relationships b/w employers and employees and to affect the moulding of human resources as controlled with physical resources.”

1. Societal Objectives:


i. Managing Human Resource – The basic objective of HRM towards society should be to ensure that their organisation manages human resources in an ethical and socially responsible manner through ensuring compliance with legal and ethical standards.

ii. Minimising the Negative Impact – The objective is to minimise the negative impact of societal demands upon the organisation. Thus, HRM preserves promote the general welfare of the community.

2. Organisational Objectives:

i. Attain Organisational Goals – HR department should focus on achieving the goals of the organisation first. If it does not meet this purpose, the HR department cannot exist in the long run. This can be done by providing well-trained and motivated employees.

ii. Job Satisfaction – HRM increases the job satisfaction and self-actualisation of employees by assisting every employee to realise their full potential.

iii. Organisational Effectiveness – HR department should recognise its role in bringing about organisational effectiveness so that employees work with full deduction with which objectives or goals can be achieved effectively.


iv. Integrating Employee Interests – While framing the HR objectives of organisation, care is taken to consider the interests and needs of employees of employee goals by integrating the employee interests and the management interests.

3. Functional Objectives:

i. Recognize Individual and Group Goals – HRM easily recognize and satisfy the individual needs and group goals by offering appropriate monetary and non­monetary incentives.

ii. Providing Better Training – HR department provide training to every employee so that they are competent or capable to perform a specified task which help in fulfilling the desired goals.

iii. Individual Development – To bring about maximum individual development of members of the organisation by providing opportunities for training and advancement.

iv. Employing Workforce – HRM should employ the skills and abilities of the workforce efficiently. It should aim at making the people’s strengths more productions and beneficial to the organisation.

4. Personnel Objectives:

i. Quality Work Life (QWL) – HRM should develop and maintain a quality of work life (QWL). It makes employment in the organisation a desirable, personal and social situation. Organisational performance can never be improved without improving the quality of work life.

ii. Assisting Personal Goals – HRM should assist the employees in achieving their personal goals, at least in so far as these goals enhance the individual’s contribution to the organisation.

iii. Communicate HR Policies – The HRM should also communicate HR policies to all employees. It will help the HRM in tapping the ideas, opinions, feelings and the views of the employees.

iv. High Morale – To provide better task, involve in decisions, take suggestions from employees, this helps in increasing high morale and encourage them.

Human Resource Management – Nature

Human Resource Management definitely has a much broader scope than personnel management at the component level as well as in coverage at the organisational level.

HRM is a very important approach to the management of people at different levels. In other words, it refers to a set of programmes, functions, activities, and so on, designed and carried out for maximising effectiveness of employees as well as the organisation.

Proper incentives, mutual involvement, timely guidance, training and advice, quick decision-making for career planning, development activities, etc. are very essential if human resource has to operate efficiently. Hence, human resources are required to be managed through the application of sound managerial principles. From this point of view, HRM is considered as a strategic approach to the acquisition, motivation, development and management of the human resources of the organisation.

The points given below makes the nature of Human Resource Management more clear:

1. Human Resource Management is a Science:

Human Resource Management is based on the principle and theories of management. It is a positive science as it is based on logical reasoning, certain principles and theories. It is not only a positive science but it also has a normative side. It will be useless unless it studies the causes which promote welfare of human resources. It is concerned with what should be done under given circumstances to make better management decisions and to achieve organisational goals most efficiently considering the welfare of the people employed. Value judgement cannot be neglected while taking certain decisions.

2. The Scope of the Human Resource Management is Vast and Increasing:

The scope of HRM is really very vast. All major activities in the working life of the people employed, right from the time of their entry into an organisation until they leave the organisation come under the purview of HRM. Such activities are human resource or manpower planning, recruitment and selection, job analysis and design, training, orientation, placement, development, performance appraisal and job evaluation, remuneration of employees, motivation, welfare, safety and health of employees, industrial relations, etc.

It is found that organisations, around the world are remodelling themselves as they have to respond to the challenges presented by the global economy. There is increased globalisation of the economy. Technological changes are taking place. Characteristics of workforce are also changing. All these and many such other aspects affect human resource practices and as a result, the scope of HRM is getting wider by the day.

3. HRM is a Comprehensive Function:

HRM covers all categories of employees employed at different levels. This implies that HRM applies to workers, supervisors, officers, managers and all other types of employees. It covers organised as well as unorganised employees and it applies to the employees in all types of organisations.

4. HRM is Employee-Oriented:

HRM is concerned with employees in attaining goals and objectives. It is also concerned with behavioural, emotional, social, economic, organisational aspects of employees. It is the process of bringing employees, other people and the organisation together so that the goals of each of them can be met.

5. HRM is Individual-Oriented:

HRM considers every employee as an individual so as to provide services and programmes in order to facilitate employee satisfaction, development and growth. This implies that HRM is concerned with the proper development of human resources in suitable manner and is individual oriented.

6. HRM is a Staff Function:

HRM is a responsibility of all line managers and a function of staff managers in an organisation. HR Managers do not manufacture or sell goods but they direct various organisational activities for the success, development and growth of an organisation by advising and managing the operating departments in the desired manner.

7. HRM is a Continuous Function or Process:

HRM is a continuous and never ending process. George R. Terry, the renowned expert in the field of management, rightly pointed out that, “It cannot be turned on and off like water from a faucet (i.e. tap); it cannot be practiced, only one hour each day or one day each week. Personnel management (or HRM) requires a constant alertness and awareness of human relations and their importance in everyday operations”.

8. HRM is a Challenging Function:

Management of human resources is not an easy task. It is a challenging job due to the dynamic nature of human resources. HRM aims at securing unreserved co-operation from all employees for attaining the pre-determined goals and objectives.

9. HRM is a Pervasive (i.e., Tending to Spread) Function:

HRM is the central sub-function of an organisation. It is concerned with all types of functional management such as production management, marketing management, financial management, etc. All managers working in an organisation are involved with human resources function.

10. HRM is Development Oriented:

Goals of employees consist of job security, job satisfaction, attractive salaries and fringe benefits, pride, status and recognition, opportunity for development, etc. HRM is definitely concerned with developing the potential of employees so that they can derive maximum satisfaction from their work and put in their best efforts, for their organisation.

11. HRM is a Part of Management Discipline:

It is beyond any doubt that HRM is an integral part of management discipline. HRM, being a branch of management science, draws heavily from management concepts, theories, principles and techniques and applies them in managing human resources.

12. HRM is Directed towards the Achievement of Goals and Objectives:

HRM is directed towards the achievement of organisational goals and objectives by providing tools and techniques of managing employees in the organisation properly and effectively. It is certain that the achievement of organisational goals and objectives depends largely on the quality of its human resources and the manner in which this quality is utilised in getting the things done.

Human Resource Management – Top 10 Features

1. Management of People – HRM is concerned with management of all categories of employees, i.e., unionised and non-unionised people in an organisation. It applies to employees working in all types of organisations including Government and private sector. Further, it is applicable to all levels of management, i.e., from top level to lower level of management.

2. Concerned with the ‘People’ Dimension in Management – It deals with human resource and is concerned with employees both as individuals as well as a group. HRM is responsible for ensuring that all employees work together as a team for achievement of the goals of the organisation.

3. Manpower Planning – HR should take the organisation forward and therefore, it has to consider the present and future manpower requirements based on the business plan of the organisation.

4. Integral Part of the General Management Function – Human resources management involves all managerial decisions, policies and practices that influence human resources directly. HR is responsible for selecting the right person for the right job and develop an organisation culture that contributes to professional well-being of employees,

5. Employee Development – Development of human resources is needed by an organisation if it wants to succeed in the fast changing business environment. The competency of human resources can be enhanced by training and development.

6. Continuous Process – The organisation is composed of people who come from different walks of life and who are different in their outlook and understanding. Therefore, personnel problems continue to exist and HR has to play a major role in solving these problems. Recruitment, selection, training and replacement of employees are continuous activities especially in a growing organisation.

7. Co-Operation of the People – Effective use of materials, machines, equipment and money requires co-operation of all employees in the organisation. Technical competence will not be sufficient if subordinates do not co-operate. Winning the co-operation of employees is one of the major challenges faced by management.

HR contributes for development of an organisation culture where teamwork and collaboration among employees are strong and facilitates growth of the organisation. In order to achieve organisation objectives, HR has to co-ordinate with other functions such as marketing, finance, manufacturing in planning manpower requirements, recruitment, selection, training, compensation and motivation of employees.

8. Employee Motivation – The primary task of the management is that of maintaining an organisation that functions willingly and effectively. Performance depends upon- (a) ability to work and (b) willingness to work, i.e., motivation. HR aims at motivating employees so that they become dynamic contributors to the organisational goals.

9. Long-Term Benefits – HRM aims to provide long-term benefits to employees, organisation and the society. Example – Career growth and financial benefits to employees, growth and development of the organisation and welfare of the society.

10. Multidisciplinary Approach – HRM makes use of various disciplines like psychology, sociology, philosophy, and economics for improving individual, group and organisational effectiveness.

Human Resource ManagementFunctions

1. Managerial Functions

2. Operative Functions

Function # 1. Managerial Functions:

The Human Resource Manager is a part of the organisational management. So he must perform the basic functions of planning, organising, directing and controlling in relation to his department.

a. Planning:

“Planning is deciding in advance what is to be done.” Planning is necessary to determine the goals of the organisation and lay down policies and procedures to reach the goals. HR manager has to undertake planning process for the activities involved in his functional area and has to integrate it with overall organisation planning.

Therefore, plans are developed to eliminate the forecast shortages and excess of particular categories of human resources. In the area of human resource management, planning involves deciding human resource goals, formulating human resource policies are programmes, preparing the human resource budget etc.

b. Organising:

In order to implement the plans, a sound organisation structure is required.

HR manager must design and develop organisation structure to carry out the various operations, which are as follow:

i. Grouping of personnel activity logically into functions.

ii. Assignment of different functions to different individuals.

iii. Delegation of authority according to the tasks assigned and responsibilities involved.

iv. Co-ordination of activities of different individuals.

c. Directing:

The direction function of the personnel manager involves encouraging working willingly and effectively for the goals of the enterprise. This function is meant to guide and motivate the people to accomplish the personnel programmes. The HR manager can motivate the employees through career planning, salary administration, ensuring employee-morale, developing cordial relationships etc.

d. Controlling:

Controlling helps the personnel (HR) manager to evaluate and control the performance of the HR department in terms of various operative functions. It involves performance appraisal, critical examination of personnel records, personnel audit, analysing labour turnover records, directing morale surveys etc.

Function # 2. Operative Functions:

Operative functions are those which are relevant to specific departments and therefore, these vary in different departments of an organisation. In case of HRM, these functions are performed to ensure that right people are available at right time and at right place.

a. Procurement Function:

It is concerned with securing and employing the right kind and proper number of people required to accomplish the organisational objectives.

It consists of following activities:

i. Job Analysis – It is the process of studying in details the operations and responsibilities involved in a job so as to identify the nature and level of human resources required to perform the job effectively.

ii. Human Resource Planning – It is the process of eliminating the present and future manpower requirements of the organisation, preparing inventory of present manpower and formulating action programmes to bridge the gaps in manpower.

iii. Recruitment – It is the process of searching the candidates for employment and stimulating them to apply for jobs in the organisation. It refers to the attempt of getting interested applicants and creating a pool of prospective employees so that management can select the right person for the right job.

iv. Selection – It implies judging the suitability of different candidates for jobs in the organisation and choosing the most appropriate people. Its aim is to reject unsuitable candidates and pick the most suitable people for the vacant jobs.

v. Placement – It means assigning suitable jobs to the selected candidates so as to match employee qualification with job requirements.

vi. Induction or Orientation – It involves familiarising the new employees with the company, the work environment and the existing employees so that the new people feel at home and can start work confidently.

vii. Separation – The organisation is responsible for meeting certain requirements of due process in separation, as well as assuming that the returned person is in as good shape as possible. The HR manager has to ensure the release of retirement benefits to the retiring personnel in time.

b. Development Function:

Proper development of personnel is necessary to increase skills in doing their jobs and in satisfying their growth need.

It includes:

i. Performance and Potential Appraisal – It implies systematic evaluation of employees with respect to their potential for development.

ii. Training – It means learning skills and knowledge for doing a particular job. It increases job skills. It is concerned with maintaining and improving current job performance. Training is valuable to the employees because it gives them greater job security and opportunity for advancement.

iii. Career Planning and Development – It involves planning the career of employees and implementing career plans so as to fulfill the career aspirations of people.

c. Compensation Function:

It refers to providing equitable and fair remuneration to employees for their contribution to the attainment of organisational objectives.

It consists of following activity:

i. Job Evaluation – It is the process of determining the relative worth of a job.

ii. Wage and Salary Administration – It implies developing and operating a suitable wage and salary programme.

iii. Bonus – It involves payment of bonus under the payment of Bonus Act, 1965 as well as non-statutory bonus and other incentives.

d. Integration Function:

It is the process of reconciling the goals of the organisation with those of its members.

Integration involves:

i. Motivation of employees

ii. Job Satisfaction

iii. Employee Grievances

iv. Collective Bargaining

v. Employee Counselling

vi. Conflict Resolution

vii. Improving Quality of Work Life

e. Maintenance Function:

It is concerned with protecting the promoting the physical and mental health of employees. It includes various fringe benefits such as housing, medical aid, educational facilities, conveyance facilities etc.

i. Personnel Records – The HR department keeps full records of their training, achievement, transfer etc. It also preserves many other records relating to the behavior of personnel like absenteeism, labour turnover etc.

ii. Industrial Relations – The HR manager can do a great deal in maintaining industrial peace in the organisation as he is deeply associated with various committees on discipline, labour welfare, safety, grievances etc. He also gives authentic information to the trade union leaders and conveys their views on various labour problems to top management.

Human Resource Management – Importance

According to Rensis Likert, “All the activities of any enterprise are initiated and determined by persons who make up that in situation. Plants, office, computers, automated equipment and all else that make a modern firm are unproductive except for human effort and direction of all the tasks of management. Managing the human component is central and the most important task because all else depends on how well it is done.”

1. Importance for the Organisation:

a. Achieving Targets – HRM brings the people and organisations together so that the goals can be met. It improves the efficiency of people and administration through which targets can be easily achieved.

b. Use of Latest Technology – In order to make use of latest technology, the appointment of right type of persons in essential. The right people can be fitted into new jobs properly only if the management performs its HR function satisfactorily.

c. Development of Personnel – Development of employees by enhancing necessary skills and right attitude among employees through training development, performance appraisals etc. and retaining the required talent through effective human resource planning, recruitment, selection, placement, orientation, compensation and promotion policies.

d. Utilisation of Human Resources – Effective use of human resources helps in exploitation of natural, physical and financial resources in a better way.

e. Globalisation- Globalisation has increased the size of the organisations who employ thousands of employees in different countries. The performance of the company depends upon the qualities of the people employed. This has further increased the importance of HRM.

2. Importance for the Employees:

a. Builds Team Spirit – Effective management of human resource promotes team work and team spirit among employees. So that targets can be achieved easily.

b. Providing Opportunities – It offers excellent growth opportunities to people who have the potential to rise for personal development of each employee.

c. Maintain Healthy Relations – HRM helps in building good and healthy relations between management and employees so that they can work together and make good coordination in achieving the targets.

d. Organisational Climate – Right organisational climate is also stressed upon so that the employees can contribute their maximum to the achievement of the organisational objectives. By providing healthy working environment team work among employees is permitted.

3. Importance for the Society:

a. Elimination of Wastage – Eliminating waste of human resources and activities through conservation of physical and mental health, people’s skills and aspirations can be developed.

b. Encouraging Talents – Scarce talents are put to use. Companies that pay treat people well always race ahead of others and deliver excellent results.

c. Good Human Resource Practices – Society as a whole is the main beneficiary of good human resource practices. Good HR efforts lead to productivity gains (ratio of output to input) to the society.

d. Reduces Costs – Since, there are good human resource practices, it enables the managers to reduce costs, save scarce resources, enhance profits and offer better pay, benefits and working conditions to employees.

Human Resource Management – Factors Influencing HRM

Several changes have taken place in business environment due to technological advancements, economic influences, political factors and labour legislations.

The factors influencing HRM could be broadly classified into three categories, i.e.:

1. Environmental,

2. Organisational and

3. Individual.

1. Environmental Factors:

Environmental factors influencing HRM include liberalisation, globalisation, and legislation, modernisation of technology, competition and employee diversity.


A revolution in the IT field is on and many Indian companies have extended their activities to countries like USA, UK and UAE. They require qualified and experienced people who can work in a multicultural environment. There are plenty of job opportunities in this field and tackling employee turnover is becoming a major challenge.

2. Organisational Factors:

Organisational factors such as competitive nature of business, need for flexibility, and downsizing, voluntary separation of employees, organisation culture, labour union, self-managed work teams and advancement in technology will have implications on HRM practices.


(a) Nowadays, there is intense competition in the marketplace, leading to tremendous pressure on margins. Organisations are trying to find out ways and means of controlling personnel cost. Many companies are going for “Flat Organisation Structure” with less number of layers in the organisation structure. Inefficient and surplus employees are being laid off. Legal issues are coming up during retrenchment. Employees are feeling less secure in their job. Employees who take voluntary separation are coming back to work, accepting lower remuneration,

(b) The concept of open space office (open cabin) has been implemented in many progressive organisations leading to less privacy and less status differentiation,

(c) Due to increasing work pressure, many young executives are getting into health problems. Companies are providing facilities such as health check-up, medical insurance and health club to employees,

(d) With the use of computers, people can work at home. HR will have to determine the output of such work and pay accordingly. An appropriate appraisal system has to be devised for such employees since close supervision is not possible,

(e) In many organisations particularly in service, sector, employees are being empowered to make more and more decisions,

(f) Position, title, and authority may no longer be adequate to get the job done through educated younger generation of employees. As told by Peter Drucker, managers have to learn to manage situations where they do not have command authority, where you are neither controlled nor controlling.

3. Individual Factors:

Individual factors consist of individual productivity, empowerment of employees, preventing brain drain, ethical and socially responsible behaviour, career growth, quality of work life, etc.


(a) Employees are becoming self-centred. Loyalty to the profession rather loyalty to the company is the approach adopted by younger generation of employees,

(b) Due to increase in workload and extended working hours, employees are facing stress-related health problems. They are concerned with the quality of work life,

(c) The numbers of dual career couples are increasing in cities and towns. The employees mobility decrease and they do not want to shift to a new geographic location,

(d) Young and educated employees change jobs to meet career aspirations.

Human Resource Management HRM in Various Sectors

Let us discuss HRM in various sectors:

1. HRM in Education:

Education aims at the generic development of human resources. Therefore, when we talk of HRM in education, we are talking about the broad development of those human resources involved in education.

The scope of HRM in education takes account of teachers, headmasters, principals, support staff working in educational institutions, heads of university departments, and university vice-chancellors.

Furthermore, the scope extends over educational administrators at the local, district, state and central levels, planners, and policy-makers. People belonging to all these categories must perform their roles efficiently. As such, it is extremely important to develop all these categories of people for the effective­ness of education. People at different levels require diverse competencies to perform various roles in order to be effective in their performance.

These competencies also vary because the environment is changing, knowledge base is continuously improving, and the needs are changing. For example, with the advent of information technology, computer competency is inevitable. Such a dynamic and chang­ing environment requires an equally or even faster developing human resources to cope with it. Hence, there is a need to continuously develop the capabilities of people involved in education.

The primary competencies required for teachers include subject matter competencies and pedagogic skills. As we go up the hierarchy in education stream, the competency requirements become much complex. For example, the headmasters of schools require leadership skills, ability to work under stress, human management skills, interacting with external agencies, building the image of the schools, and so on. These are more sophisticated competencies than what a teacher requires.

As one goes still higher up to the level of district education officer (DEO), the competency require­ments become even more complex. A DEO is required to deal with a large number of institutions and guide them; he/she is required to be familiar with the region and its educational problems and should have the competency to guide the headmasters of a large number of schools.

DEOs should further be able to establish management systems to maintain information, monitor school performance, suggest innovative schemes to the schools, involve the community for improving educational facilities in the region, etc.

Thus, the complexity of the capability requirements changes for different roles. As all these roles are equally important for the effectiveness of the education systems, it becomes essential to ensure the continuous development of the human resources occupying these roles.

Training has always been used as a vital component of the HRM function for developing human resources in the education sector. We need to identify other mechanisms of human resource development for successful role accomplishment. The limitations of training in developing complex capabilities have not been adequately recognized in the past. The country is now facing a shortage of skills and knowledge among graduates from engineering and management institutes.

They are not capable of efficiently contributing to any company immediately after graduation. The educators and educational administrators need complex skills to design the curriculum, impart the knowledge required by industries, and produce graduates who are readily employable. For example, it is easier to develop subject matter competencies in teachers through classroom instruction.

However, teaching skills cannot be developed only through classroom instruction; these skills develop through actual practice. Higher level competencies required by headmasters, principals, DEOs, etc., cannot be developed in the classrooms alone.

There is a need to identify alternate mechanisms for developing skills among the human resources. Experience from other sectors indicates that HRD can be affected through performance appraisal systems that are designed to promote employee development in their present roles. Potential development system is also used for keeping one prepared for the future. Organizational development (OD) exercises could be undertaken to create self-renewal capabilities in educational institutions.

Educational institutions and agencies need a development climate. As such, career opportunities and rewards are vital. An educational institution may be facing slow growth in situations where there is no good development climate, pressure, or compensation including rewards and incentives.

2. HRM in the Knowledge Industry:

There are many HRM theories. In this era of explosion of information technology, knowledge manage­ment, dwindling business scenario, and acute competition, the need for young and energetic individuals is challenging several time-tested theories of employee recruitment, staffing, motivation, and general HR practices. Organizations are facing a lot of challenges while recruiting fresh talent.

The recruitment challenges include attracting people with multidimensional experiences and skills, developing a culture that attracts people, designing entry pay packages that compete on quality and not quantum, and so forth. Companies also need to anticipate future vacancies considering their strategy and future needs. Human resources are required to be searched and recruited such that their services can be utilized immediately after such a need arises.

The role of the HR manager is:

i. To develop fully self-expressed and self-propelled individuals

ii. To involve and engage them in organizational activities

iii. To enable and facilitate their effective participation in teams

iv. To empower them to innovate.

However, to develop fully self-expressed and self-propelled individuals, involving and engaging them, enabling and facilitating their effective participation, and making them innovative, some careful steps must be pursued. These individu­als primarily need challenging jobs, growth, intrinsic satisfaction, and so forth. Designing attractive compensation management system is only secondary.

People working in the knowledge industry need to be supported more than to be man­aged. In order to derive their best performance, the HR needs to care for their emotional needs. People of higher levels mostly remain engrossed in office work and can seldom discharge family responsibilities. HR must make sure that their work and family lives are well-balanced.

Some added responsibilities of HR with regard to managing employees in the educational sector include the following:

a. Caring for their emotional needs

b. Balancing work and personal life

c. Advocating change

d. Being a strategic partner

e. Providing a human touch.

a. Caring for Emotional Needs:

In order to get the best from the employees, we must take care to identify and fulfil their emotional needs. The first step is to enhance the emotional intelligence of people. A person can have the best training in the world, a penetrating and insightful brain, and an analytical mind with an endless supply of smart ideas.

In spite of having the positive attributes, he can never be a good leader if he does not possess high emotional stability. Effective people are no longer the ones with only high intelligence quotient (IQ); they are the ones who also possess high emotional quotient (EQ).

A high correlation between emotional intelligence and effective performance has already been evidenced by many academicians and research scholars. People with high emotional intelligence help in establishing good interpersonal relations, guided by dominant independence motive, are self-propelled, self-motivated, and emphatic.

b. Balancing Work and Personal Life:

Balancing work and personal life is a significant area as achieving the right balance between the work place and home is crucial to the efficient running of any organization. Incidentally, the findings of a recent survey on 2,500 highest-ranking MBAs from B-schools in Europe and USA conducted by management graduates identified balancing personal life and work life as their top most career objective (en(dot)allexperts(dot)com, last accessed on 7 February 2012).

c. Advocating Change:

HR managers and professionals should be able to develop and change the mind-set of the employees. Therefore, they should work as a change advocate who is responsible for bringing about changes in individual behaviour patterns. For being a better change advocate, one has to be an extrovert, possess considerable interpersonal skills, have to be creative, take risks, and be good in organizing activities.

The change advocate should also be close to employees, understand their feelings, emotions, and thoughts, possess good communication skills, be accessible to all, plan activities systematically, evaluate objectively, and reward people for outstanding performance.

d. Being a Strategic Partner:

Human resource plays a substantial role in achieving the business goals. In order to perform this role effectively, HR professionals should have thorough knowledge of business and human resource functions, the ability to lead any change process, innovation, problem solving, the leadership ability to influence the members and organization, be able to work in stressful conditions without being frustrated, and view the brighter side of any situation.

e. Providing a Human Touch:

Employees should be close to one another for creating a healthy work environment and improving their quality of work life. The work environment should be conducive to performance without generating unwanted stress. Good interpersonal relations and highly motivated employees can create such an environment.

Both monetary and non-monetary benefits are required to motivate the workforce. Organizational systems such as job restructuring, job redesign, career development, promotional opportunities and so on are also essential.

Some motivational tools comprise celebrating achievements of teams and individuals, offering birthday gifts, gifting dinner coupons on marriage anniversaries, installing flexi-time work systems, offering paid vacations, giving cards/mails and appreciation letter to recognize personal achievement, going on an outing with project team at the end of the successful completion of a project, ensuring services such as free health check-ups, canteen facility, recreation room and so on.

There is a need to increase the credibility of HR within the organization and this can be accomplished by being accurate in HR tasks, being predictable and maintaining consistency, being committed and sticking to specified budget, and being personally comfortable with peers, subordinates, and superiors.

Most of the time, talent remains underutilized and untapped. It is important to understand people and provide them with the appropriate environment to harness the latent power within them. This initiative will make a difference between success and failure in the future and lead to the realization of the power of the human spirit.

Human Resource Management – Activities in a Typical Organization

The department which is responsible for getting workers or employees to an organization had gone through a number of changes in its evolutionary process. At one time, the department which was given the responsibility to look after the personnel matters was known as welfare department and the person who looked after this responsibility was tided, welfare officer. Then this was replaced by personnel manager or officer.

This individual’s responsibility was to find people for the organization at the request of the top management. In some organizations, the manager who was assigned with the function of dealing with procuring, placing them on the job and looking after their well-being was known as employee relations manager. In recent years, the tide of manager who looks after the personnel-related matters is known as the human resource manager.

One may wonder whether the change in these tides brought about any changes in their responsibilities, either by expanding or shrinking their responsibilities. Generally, their responsibilities are redefined in recent years and a few more layers are added in the chain of command within the department which looks after the human resource function. The size of the organization may determine the scope of human resource function within an organization. Let us see what activities constitute human resource management.

Basically, the human resource management function includes the determination of manpower needs, the finding of people to fill these needs, their recruitment and employment, their placement and orientation. There are many internal factors that affect human resource management. They are organizational goals, tasks, technology, organizational structure, and the kinds of people, the demand and supply of managerial personnel, reward systems and policies. The rearrangement of team members is done through upgrading and transfers.

Generally, everyone in a supervisory position handles some aspect of human resource function, even though the human resource department does the coordination function and provides technical assistance when and where needed. In small companies, the production or plant manager has human resource function as one of his main responsibilities.

In medium and large organizations, there is a special unit or department to look after the human resource function. In some innovative companies, greater importance is given to this function by letting the head of the human resource department to participate and provide input into the strategy formulation exercises.

Let us see the human resource management activities in a typical organization:

i. Determination of human resource requirements and needs

ii. Calling for applicants to fill the requirements

iii. Preliminary interviews of screening process (Potentials)

iv. Issuing applications to the potential candidates

v. Psychological and other forms of testing

vi. Structured or unstructured interview

vii. Contacting referees

viii. Final selection by Department Head (Technical)

ix. Medical examination

x. Orientation and induction

The above steps are found in many organizations in selecting people for managerial and supervisory positions with the exception of psychological tests. Although different kinds of tests are available for organizational use, the common ones are aptitude tests, achievement, vocational, and personality tests. Slowly these tests are also being introduced in large organizations in India.

In order to be placed on jobs, an individual candidate may have to go through all these steps. In a small or medium-sized organization, all these steps may not be involved. Basically, an assessment is made to determine whether the potential candidate has needed qualifications to be placed on the job. If there is gap between the requirements and the qualifications the candidate possesses, such gap is closed through further training and development.

Further human resource management activities may include:

i. Training (Operative employees)

ii. Development (managers)

iii. Performance assessment

iv. Upgrading

v. Career development

vi. Compensation

vii. Benefit programs

viii. Inducting into Unions (Company unions)

The scope and the extent of the above human resource activities may depend upon the size and strength of employees in an organization. Although the human resource function has become highly specialized in the recent years in many parts of the world, companies in India and Asia in general have yet to catch up fully with the trend. This may be due to a number of reasons.

The abundance of availability of all kinds of employees creates a lethargic attitude among human resource executives and they are not motivated to refine their activities. They develop a kind of feeling that they can hire and fire anyone at any time. In the above list, the Career Development or Succession Planning is yet to find its place in Indian corporations. The militant attitude of unions restricts the modernization process of the human resource management function in some organizations and countries.

Traditional practices such as, nepotism and paternalism have resulted in the lack of a systematic and objective approach to the practice of human resource management. For instance, the joint- family system and the caste system have fostered nepotism in the Indian industry for decades. The system of recruitment on the basis of potential ability, competence, and skill has not yet found a wide acceptance in the Indian industry.

The government officials and politicians from local to national level exert pressure on businessmen and executives in getting jobs for their children and relatives. At times, bribing plays a role in securing jobs even at the lower level. There is an expression that goes, “it is not what you know but whom you know” which makes the difference. When nepotism is practiced, a manager has to put up with incompetence because he will not be able to fire his friend or relative or the person recommended by higher-ups.

But in the recent years, corruption has spread to all kinds of companies. It has become a way of life. The thinking is that you have put in lots of money in getting education, securing a plum job and you have to make it up by making extra income by illegal means. These illegal mean affect the efficiency, effectiveness and the profitability at the organizational level.

Since, these things seem to work in hierarchical fashion, nobody seems to bother about these things and life goes on. Recently, the media brought to public attention, the corrupt practices in the Indian Railway Board. The television networks and the media in general played an active role in recent years to bring such corrupt practices to the focus of the society. Because of the media, strict actions were taken on those who indulge in corrupt practices. The judicial system is taking an active and objective role in this process. Of course, there is still scope for improvement.

Human Resource Management – Career

There are many different types of jobs in the HRM profession. The vast majority of HRM professionals have a college degree, and many also have completed postgraduate work. The typical field of study is business (especially human resources or industrial relations), but some HRM professionals have degrees in the so­cial sciences (economics or psychology), the humanities, and law programs.

Those who have completed graduate work have master’s degrees in HR management, business management, or a similar field. A well-rounded educational background will serve a person well in an HRM position.

HR professionals can increase their career opportunities by taking advantage of training and development programs. General Motors offers its human resource em­ployees a curriculum designed to improve their ability to contribute to the company’s business success.

The training program details the goals of HRM at General Motors, explains how these relate to business changes at the company, and teaches business topics such as finance and the management of change.

Some HRM professionals have a professional certification in HRM, but many more are members of professional associations. The primary professional organization for HRM is the Society for Human Resource Management (SHRM). SHRM is the world’s largest human resource management association, with more than 210,000 professional and student members throughout the world.

SHRM provides education and informa­tion services, conferences and seminars, government and media representation, and online services and publications (such as HR Magazine). You can visit SHRM’s Web site to see their services at www(dot)shrm(dot)org.

Human Resource Management – Main Roles Played by an HR Manager

It is not easy to profile the job of an HR manager in definite terms. It differs from organisation to organ­isation and also differs even within the same organisation from time to time, depending on situations. He/she has to play several roles such as an advisory role, guidance role, service role and so on.

Some of the main roles played by an HR manager are as follows:

1. Conscience role – Reminding the management of its moral and ethical obligations towards its employees

2. Line and staff role – Line role within the HR department and staff role for the rest of the organisation

3. Media specialist’s role

4. Counsellor’s/advisory role

5. Spokesperson of the HR department/company role

6. Group facilitator’s role

7. Programme designer’s role

8. Programme administrator’s role

9. Role of the evaluator of utility of a personnel programme or service

10. Mediator’s role

11. Theoretician’s role (developing and testing theories of learning, training and development)

12. Trainer and developer’s role

13. Strategic role

14. Change agent’s role

15. Task analyst’s role

16. Marketer’s role

17. Decision-making role

18. Role of assimilation and dissemination of information

19. Functional role (procurement, development, compensation, integration and maintenance)

20. Image building role

21. Leadership role

22. Performance boosting role

23. Employee advocacy role

24. Need analysing role

25. Others.

Of late, the role of an HR manager is changing. Unlike in the past, now he/she is expected to provide significant inputs to the top management while the strategy for the organisation as a whole is being for­mulated. It is not only in the formulation of the strategy of the organisation that he/she is supposed to play a vital role but also in the strategy implementation.

An HR manager is also supposed to prepare an HR strategy which should not only be ‘vertically fit’ but also be ‘horizontally fit’. He/she is now seen as a strategic partner in the organisation.

Today, an HR manager is supposed to play the role of an expert in identifying the needs of employees and frame not only the HR plan and training and development programmes appropriately but also for­mulate wage, benefit and services programmes which should be pragmatic and prove effective in deliver­ing the desired results.

Today, an HR manager is supposed to be a quality professional, knowledgeable and highly enlight­ened, as today both the employees and the management have become highly conscious of their rights and privileges and the HR manager is supposed to maintain the balance between the two.

An HR manager these days is supposed to be an expert in HR planning (HRP) and is supposed to keep it aligned to the strategic plan of the organisation. Today, he/she is to play the role of an expert psychologist who is well versed in various methods of psychological tests and selecting the right person at right jobs.

Today, he/she is supposed to play the role of a mentor of high order and take full care of the employees.

Human Resource Management – Ethics, Employee Rights and Standard of Ethical Behaviour

Whenever people’s actions affect one another, ethical issues arise, and business decisions are no exception. Ethics refers to fundamental principles of right and wrong; ethical behaviour is behaviour that is consistent with those principles. Busi­ness decisions, including HRM decisions, should be ethical, but the evidence suggests that is not always what happens.

Recent surveys indicate that the general public and managers do not have positive perceptions of the ethical conduct of U.S. businesses. For example, in a survey conducted by the Wall Street Journal, 4 out of 10 executives reported they had been asked to behave unethically.

Many ethical issues in the workplace involve human resource management. Na­tionwide Insurance has a three-person ethics office that offers a confidential “help line” for employees. About two-thirds of the calls to the help line involve issues re­lated to human resource management—for example, conflicts with co-workers or su­pervisors or complaints of sexual harassment.

When employees raise these concerns, the human resource team investigates them and takes action when necessary. Other departments handle other issues, such as those involving security or legal matters. The goal of these efforts is to keep employees focused on living up to the company’s values, rather than just staying out of legal trouble.

Employee Rights:

In the context of ethical human resource management, HR managers must view employees as having basic rights. Such a view reflects ethical principles embodied in the U.S. Constitution and Bill of Rights. A widely adopted understanding of human rights, based on the work of the philosopher Immanuel Kant, as well as the tradition of the Enlightenment, assumes that in a moral universe, every person has certain basic rights-

1. Right of Free Consent:

People have the right to be treated only as they knowingly and willingly consent to be treated. An example that applies to employees would be that employees should know the nature of the job they are being hired to do; the employer should not deceive them.

2. Right of Privacy:

People have the right to do as they wish in their private lives, and they have the right to control what they reveal about private activities. One way an employer respects this right is by keeping employees’ medical records confidential.

3. Right of Freedom of Conscience:

People have the right to refuse to do what violates their moral beliefs, as long as these beliefs reflect commonly accepted norms. A su­pervisor who demands that an employee do something that is unsafe or environ­mentally damaging may be violating this right if it conflicts with the employee’s values. (Such behaviour could be illegal as well as unethical.)

4. Right of Freedom of Speech:

People have the right to criticize an organization’s eth­ics, if they do so in good conscience and their criticism does not violate the rights of individuals in the organization. Many organizations address this right by offering hot lines or policies and procedures designed to handle complaints from employees.

5. Right to Due Process:

If people believe their rights are being violated, they have the right to a fair and impartial hearing. Congress has addressed this right in some circumstances by establishing agencies to hear complaints when employees believe their employer has not provided a fair hear­ing. For example, the Equal Employment Opportunity Commission may prose­cute complaints of discrimination if it believes the employer did not fairly handle the problem.

One way to think about ethics in business is that the morally correct action is the one that minimizes encroachments on and avoids violations of these rights.

As the examples above suggest, organizations often face situations in which the rights of employees are affected. In particular, the right of privacy has received much attention in recent years. Computerized record keeping and computer networks have greatly increased the ways people can gain (authorized or unauthorized) access to re­cords about individuals.

Human resource records can be particularly sensitive. HRM responsibilities therefore include the ever-growing challenge of maintaining confi­dentiality.

Standards for Ethical Behaviour:

Ethical, successful companies act according to four principles-

First, in their rela­tionships with customers, vendors, and clients, ethical and successful companies em­phasize mutual benefits.

Second, employees assume responsibility for the actions of the company.

Third, such companies have a sense of purpose or vision that employee’s value and use in their day-to-day work.

Finally, they emphasize fairness; that is, another person’s interests count as much as their own.

United Parcel Service (UPS) has made a commitment to ensure that every em­ployee takes responsibility for ethical behavior. At the top of the organization, UPS’s chief executive officer emphasizes that employees who get results by violating laws or ethical principles harm the company by undermining its customer relationships and ability to grow.

The company has developed a set of ethics-related processes and pro­cedures, embodied in a Code of Business Conduct. All employees must read and agree to follow that code, which describes the kinds of behavior required in a variety of business situations. UPS has also hired a company to provide a hotline employees can call if they have concerns that ethical standards have been violated.

All information received by the hotline is forwarded to UPS’s compliance departments, whose employ­ees investigate and ensure that appropriate action is taken. Managers of business units are evaluated based on ethical as well as financial standards. Each year, managers evaluate their unit’s employee and business relationships in terms of ethical issues.

For human resource practices to be considered ethical, they must satisfy the three basic standards-

First, HRM practices must result in the greatest good for the largest number of people.

Second, employment practices must respect basic human rights of privacy, due process, consent, and free speech.

Third, managers must treat employees and customers equitably and fairly.

These standards are most vexing when none of the alternatives in a situation meets all three of them. For instance, most employers hesitate to get involved in the personal affairs of em­ployees, and this attitude is in keeping with employees’ right to privacy. But when personal matters include domestic violence, employees’ safety may be in jeopardy, both at home and in the workplace.

For Barbara Marlowe of the Boston law firm Mintz Levin Cohn Ferris Glovsky and Popeo, the choice is clear: Helping employees protect themselves does good for employees and also helps employees do better on the job, she says. Mintz Levin set up a group called Employers against Domestic Vio­lence.

Companies that join the group take measures such as posting the phone num­ber of a victim help line, allowing employees to keep flexible hours (to shake off stalkers), and removing victims’ names from dial-by-name directories (so harassers can’t easily call and disturb them at work).

Human Resource Management – Policies

In general terms, human resource policies provide guidelines stating how the objectives of an organization would be achieved. These guidelines help in making decisions in matters related to recruitment, selection, motivation, and training and development. For example, a recruitment plan would indicate sources and methods of recruitment, as well as the time-period within which recruitment needs to be completed.

The process of making and implementing human resource policies is compounded by complex interactions among federal, state, and local agencies. These policies must comply with the standards prescribed by the government. For example, the Prime Minister of India, Dr. Manmohan Singh, stated at the 40th Indian Labour Conference that more flexible and transparent labour laws are expected to increase the level of employment. Therefore, now-a-days organizations are adopting more transparent human resource policies to provide equal job opportunities to all the deserving candidates.

It is an essential aspect of the industrial relations to provide healthy working environment for maintaining the health and safety of the employees. This has been recognized by several committees set up by the government and National Commission on Labor. The government has enacted several laws, such as Minimum Wages Act, equal pay for equal work, fixation of number of working hours.

Factories Act (1948), and Employees’ State Insurance Act (1948), to ensure that the employees are given justice. For instance, Article 39 of the directive principles of state under the Indian Constitution has stated that “The health of workers, men, and women and the tender age of children will not be abused.” Furthermore, Article 42 states that “The State shall work and maintain humane conditions of work.”

Therefore, the government has set up various committees to take care of the ethical implementation of the human resource policies laid down by the organization and various government agencies. For instance, Labour Bureau has been set up under the Ministry of Labor, Government of India to collect, compile, and publish data on employees’ health and safety related matters, including accidents and diseases at workplaces.

Human Resource Management Line and Staff Aspect of HRM

All managers who get work done through their subordinates are in a sense HR managers. Some of HR functions are performed by all Line Managers whose basic functions are their respective departmental responsibilities. However, there is a separate HR department which functions as staff department. We shall understand this by defining Line and Staff.

Authority — is the right to make decisions, to direct the work of others, to give orders.

Line Managers — are authorised to direct the work of their subordinates, are responsible for accomplishing organisation’s goals.

Staff Managers — are authorised to assist and advise line managers in accomplishing these basic goals. HR Managers are staff managers and advise Line Managers in areas of recruiting, compensation, training etc.

What is expected of a Line Manager when he is directing or supervising his subordinate?

(1) Placing right person on the right job;

(2) Orientation and induction of new employees;

(3) Training subordinates for new jobs;

(4) Performance monitoring and improving;

(5) Interpreting company’s policies and procedures;

(6) Controlling costs, wastages;

(7) Developing abilities of each employee;

(8) Protecting employees’ health (safety, accident prevention);

(9) Creating and maintaining employee morale;

(10) Creating smooth working relationship.

HR Manager’s Staff Functions are, serving and assisting line managers by employing, training, evaluating, rewarding, promoting, counselling, firing employees. He administers benefit programmes also known as welfare work which includes canteen, health, accident, insurance, retirements, vacations and others like complying with legal aspects of employment, employee relations (union management relations).

Human Resource ManagementComplexities of HRM to Ensure Sustained Competitive Advantage 

Any competitive advantage enjoyed by an organisation tends to be short lived because other companies are likely to follow them. So the chal­lenge for an HR manager is to develop strategies that offer the firm a sustained competitive advantage.

In developing such an effective human resource management program, the organisation faces several complexities, and they are explained as under:

1. Avoiding Excessive Concentration on Day-to-Day Problems:

HR people are generally absorbed in growing the business today that they seldom pause to look at the big picture for tomorrow while it is important for the organisation that a successful HR strategy should demand a vision tied to the long-term direction of the business.

2. Reinforcing Overall Business Strategy:

Developing coordination between the HR strategies and the overall business strategy is the most difficult task for most of the organisations because each business unit or department might like to formulate the HR poli­cies that best suits them while ignoring the overall business stra­tegy.

3. Developing HR Strategies Suited to Unique Organisational Features:

No two firms are alike; they differ in terms of their history, cul­ture, leadership style, technology, and so on. So it becomes a great difficulty for any human resource management program to develop strategies that fits well with other organisational characteristics.

4. Coping with the Environment:

Just as no two firms are exactly alike; no two firms operate in an identical environment. Some must deal with the rapid change, as in computer industry; others operate in a relatively stable market, as in the market for food processors. Some face a virtually guaranteed demand for their products or services; others must deal with turbulent demand (fashion garments).

So it becomes a major challenge for the HR department to craft strategies that will work in the firm’s unique environment to give it a sustainable competitive advantage.

5. Securing Management Commitment:

HR strategies have little chance of success unless managers at all level including top executives support them completely. To ensure managers com­mitment, HR professionals must work closely with them when formulating policies.

6. Translating the Strategic Plan into Action:

Perhaps the greatest challenge in for human resource managers lies not in the formu­lation of a strategy, but rather in the development of an appropri­ate set of programs that will make the strategy work.

7. Combining Intended and Emergent Strategies:

Debate continues over whether HR strategies should be intended in nature — for­mulated by top management and is proactive, rational, deliber­ate plans designed to attain predetermined objectives; or emer­gent in nature—formulated by the collective vision of all employ­ees reflecting grass-roots support and involving an interplay of power, politics, negotiation and collective wisdom.

8. Accommodating Change:

HR policies must be flexible enough to accommodate change taking place in various environmental fac­tors affecting the business. The challenge is to create a strategic vision and develop the plan to achieve it while staying flexible enough to adapt to change.

So, to conclude it can be said that HR management play a very impor­tant role in today’s organisational set up. They provide the organisation with a competitive edge in the fast changing, globally competitive and quality oriented industrial environment. Therefore it is important to involve the HR manager in all the important policy formulations, implementation, and monitoring of strategic plans.

Human Resource Management – Impact of Technology

Change is the order of the day. ‘Change, before change changes you’ and ‘change or decay’ are the buzz phrases the day. The factors that force the change include: nature of the workforce, technology, economic shocks, competition, social trends and world of politics.

Just as necessity is the mother of invention, competition and a host of other reasons are responsible for the rapid technological changes and innovations all over the world. As a result of these changes, technical personnel, system specialists, technical workers and machine operators are increasingly required while the demand for other categories of employees has declined.

But it is found that the supply of former category of employees is less compared to the demand for the same. Hence, procurement of skilled employees and maintaining them is highly essential. Further, the changes in technology continuously demand the existing employees to upgrade their skills and knowledge.

Human resources development techniques help the employees to acquire new skills and knowledge necessary to carry out the changed duties due to up-gradation of technology. Technology replaces human resources.

Technology is the most dramatic force shaping the destiny of people all over the world. Technology is self-reinforcing and in a big way affects society. In fact, technology reaches people through business. It increases the expectations of the customers. It brings social change and makes social system complex.

The impact of technology on human resources is significant, direct and complex. The impact of technology on HRD is through- (i) jobs becoming intellectual, (ii) need for bio-professional and multi-professional managers, (iii) change in organisation structure, (iv) TQM and (v) BPRE.

(i) Jobs Become Intellectual:

Enhancement of the level of the technology needs high level skills and knowledge. These high level skills and knowledge should be incorporated in the job description. Jobs handled by semi-skilled employees are now to be handled by skilled employees.

Jobs handled by the clerks yesterday are now to be handled by a computer programmer. Advanced technology degrades some employees and retrenches some employees from employment unless they are trained and developed on the application of new technology and methods.

New technology demands high level skills, knowledge and values. These aspects are incorporated in the job description. Hence jobs become intellectual. These factors demand for development of human resources.

(ii) Need for Bio-Professionals and Multi-Professionals:

Recent technological advancements changed the job descriptions. These changed job descriptions require the employees with both technical skills and marketing skills. Some jobs need the employees with technical skills, marketing skills, finance skills and human resources management skills.

Thus, technology demands bio-professionals and multi-professionals. But present employees are single professionals. Development of human resources of the single professional employees is necessary to make them bio-professionals and multi-professionals.

(iii) Technology and Organisational Structure:

Technology brings changes in the span of control, delegation of authority like delegation to individual employees or groups of employees.

These changes bring changes in the present organisational structure. Further, technology results in downsizing and de-layering. These factors also change the organisational structure. Technology influences the organisational structure through job redesign and change in job description and demand for new skills and knowledge from the employees. These factors invariably necessitate the development of human resources.

(iv) TQM:

Total Quality Management is mostly developed based on changes in technology. Further, it is influenced by changes in methods. These factors necessitate training and development of the employees in these new areas.

(v) BPRE:

Business Process Reengineering basically changes the process of the business. In other words, it changes the existing patterns of production, marketing, finance and human resources functions. It brings the business process centered on a customer’s needs, preferences or needs of a project or activity. Further, this process changes the existing technology and methods. These changes influence HRD.

Human Resource Management – New Trends in HRM

The management has to recognize the important role of Human Resource Department in order to successfully steer organizations towards profitability. It is necessary for the management to invest considerable time and amount, to learn the changing scenario of the HR department in the 21st century.

In order to survive the competition and be in the race, HR department should consciously update itself with the transformation in HR and be aware of the HR issues cropping up. With high attrition rates, poaching strategies of competitors, there is a huge shortage of skilled employees and hence, a company’s HR activities play a vital role in combating this crisis. Therefore, Suitable HR policies should be formulated.

HR managers have to manage all the challenges that they would face from recruiting employees, to training them, and then developing strategies for retaining them and building up an effective career management system for them. Just taking care of employees would not be enough; new HR initiatives should also focus on the quality needs, customer-orientation, productivity and stress, team work and leadership building.

Areas of Growing Concern for HR Managers at the Workplace:

1. Rise in healthcare costs

2. Use of technology to communicate

3. Growing Complexity of legal compliance

4. Use of technology to perform HR functions

5. Use and development of e-learning

6. Changing definition of family

7. Growing conflicts in personal lives of employees that affect productivity

8. Increasing presence of nuclear families

9. Need for children to be taken care of by the young parents which affects their continuity in job and performance.

The Changing Role of HR in Organizations:

1. Preparing the Organization for Change

2. Building Employee Commitment and Morale

3. Involvement in Determining and Implementing the Strategic Direction of the Organization

Challenges for HR in the 21st Century:

1. Embracing technology as the underlying facilitator

2. Incorporating flexibility and adaptability into the organization

3. Recognizing the workforce as a profit earners or value drivers

4. Developing strategies to Win the war for acquiring talent available in the market

5. Cultivating leadership through e-learning and development

6. Thinking globally while complying locally.

Competencies for 21st Century HR Professionals:

1. Developing Effective Reward and Recognition Systems

2. Creating and Becoming Transformational Leaders

3. Engaging the Workforce in Continuous Change and Innovation

4. Collaborating in Resolving of Strategic Problems

5. Encouraging Real Employee Involvement

6. Coaching and Counselling Individuals and High Performance Teams

7. Empowering and Facilitating Learning, Change, and Decision-making

8. Creating the “Learning” Organization

9. Keeping Up-to-Date on Technological Advances in HR Applications

10. Maintaining a Global Business Perspective.

According to Peter F. Drucker “I never predict. I just look out the window and see what is visible – but not yet seen.”

Human Resource Management Some Recent Studies in the Field of HRM

In its modern form, the term “human resource management” came into usage from the 1980s onwards. However, the concept did not emerge all of a sudden. Human aspects of industry began to be given serious attention by theorists and experts ever since the dawn of the twentieth century.

Without undermining the importance of the contributions of other scholars, the contributions of Gantt, Gilbreth, Mayo, Roethlisberger, Bernard, Maslow, Alderfer, Herzberg, McGregor, McClelland, Vroom and Adams deserve particular attention. Some of the major areas covered by them included employees’ needs and their preferences, motivation, incentives, employees’ behaviour, attitudes and job satisfaction, supervision, importance of groups and working conditions.

The theories and approaches of these scholars have been incorporated in the syllabi of management studies in a number of educational institutions. In addition, they have also come to influence human resource management practices in various organisations all over the world.

Apart from these, there also have been some more recent contributions in the area, which deserve particular mention. It may, however, be asserted that most of these recent theories and approaches have emerged mainly as a result of the conditions resulting from highly competitive product markets and globalisation.

The contributions of some of them are described below:

1. Richard Pascale and Anthony Athos:

Tom Peters and Robert Waterman (1981, 1982) developed 7-S Framework of Strategic Management with reference to Japanese industry. It is also known as McKinsey 7-S Model as Peters and Waterman have been consultants at McKinsey & Co. The 7-S Model is described below.

7-S Model of Strategic Management:

(i) Strategy – A set of actions that management should start with and must maintain.

(ii) Structure – The manner of organising people’s task or work.

(iii) Systems – Establishing an appropriate administrative system with such a flow of processes and information which are congenial to linking organisation together.

(iv) Style – Manner of managers’ behaviour.

(v) Staff – The manner of developing people with emphasis on having the right kind of people on various jobs.

(vi) Superordinate – It represents a long-term vision and all values which shape the destiny of the organisation.

(vii) Skills – Developing dominant attributes or capabilities that exist in the organisation.

According to Pascale and Athos, Japanese companies are more effective because they integrate these seven components in their organisations. They call these factors “Soft Ss” which are concerned with human elements considered vital in Japanese firms.

2. Willian G. Ouchi:

The proponent of “Theory Z”, Ouchi in his book entitled, “Theory Z – How American Business Can Meet the Japanese Challenge” has held that the secret to Japanese success is not technology, but a special way of managing people. It represents a management style that emphasises a strong company philosophy, a distinct corporate culture, long-range staff-development and consensus decision-making.

In his “M-Form Society” (1984), Ouchi has laid emphasis on harmonious relationships amongst financial institutions, industrial organisations, labour and government for developing industrial harmony.

3. Human Resource Wheel of HRM:

The American Society for Training and Development (ASTD) developed a Human Resource Wheel in 1983 highlighting different functions of HRM leading to quality of work life, productivity and readiness for change.

The focus of this wheel is on – (i) training and development, (ii) organisation development, (iii) career development, (iv) organisational job design, (v) human resource planning, (vi) performance management system, (vii) selection and staffing, (viii) compensation and benefits, (ix) employee assistance, (x) union-labour relations and (xi) HR research and information systems.

4. Michael Beer, Richard E. Walton and Bert A. Spector (1984):

Michael Beer, Richard E. Walton and Bert A. Spector (1984) developed the Harvard Map of HRM. The Map provides a broad causal depiction of the determinants and consequences of HRM policies. The Map identifies two significant considerations which influence HR policies.

These are situational factors such as laws, labour market considerations, trade unions, management philosophy and so on; and stakeholders’ interests such as those of shareholders, employees, trade unions, community and government. Managers have four policy choices to affect the operation of these factors.

These are – (i) overall competence of employees, (ii) commitment of employees, (iii) degree of congruence between employees’ own goals and those of the organisation and (iv) the overall cost-effectiveness of HRM practices.

5. John Storey (Hard HRM and Soft HRM):

Based primarily on Michigan and Harvard models of management, represented in the forms of “Theory X” and “Theory Y” respectively, Storey (1989) developed “Hard HRM” and “Soft HRM” models. Hard HRM focuses on the resource aspect of HRM. It calculates cost in the form of “head counts” and vests control firmly in the hands of management.

The role of a manager is to manage the numbers effectively and to ensure that the performance of the workforce is in conformity with the requirements of the organisation. On the contrary, Soft HRM lays emphasis on the human aspects of workforce. Its basic concerns are motivation and communication. Under this form, human resources are led rather than managed. Work-people are also involved in the determination and realisation of strategic objectives.

6. Nina Hatvany and Vladimir Pucik:

Hatvany and Pucik (1981) developed a model of Japanese society depicting three strategies in the perspective of human resources. These are – (i) to develop an internal labour market securing a desired quantity of labour force and to induce the employees to remain in the labour force, (ii) to articulate company philosophy based on concern for employees’ needs and cooperation and team-work and (iii) to engage in intensive socialisation.

These broad strategies can be blended with specific management techniques such as job rotation, slow promotion, evaluation of attributes, emphasis on work-groups, consultative decision-making, open communication and concern for employees.

Human Resource Management5 Major Limitations

HRM approach is very useful in creating work culture in the organisation but still it suffers from certain limitations:

1. Recent Origin – HRM is of recent origin, so it lacks universally approved academic base. Some thinkers consider it as a new name of personnel management. Some organisations have named their traditional personnel management department as HRM department.

2. Lack of Top Management Support – HRM must have the support of top level management. The change in attitude at the top can bring good results while implementing HRM. Because of passive attitude at the top, this work is handled by personnel management people.

3. Improper Implementation – HRM should be implemented by assessing the training and development needs of employees. The needs and aspirations of people should be taken into account while framing HR policies. HRM is implemented half-heartedly. Management’s productivity and profitability approach remains undisturbed in management organisations.

4. Inadequate Development Programmes – HRM requires implementation of programmes such as career planning, on the job training, development programmes, counseling etc. There is a need to create an atmosphere of learning in the organisation. In reality HRM programmes are confined to classroom lectures and expected results are not coming out from this approach.

5. Inadequate Information – Some Organisations do not have requisite information about their employees. In the absence of adequate information and data base this system cannot be properly implemented. There is a need to collect, store and retrieval of information before implementing HRM.