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Scope of HRM

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Everything you need to know about the scope of HRM. HRM is concerned with the ‘people’ dimensions of the organisations.

The organizational objectives can be best attained by acquiring human resource, develop their skills, motivate them for high performance and ensure that they continue to maintain their commitment and loyalty towards the high performance.

The scope of HRM is very vast. It covers all the activities in the working life of an employee.

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The scope of HRM is comparatively wider with enhanced vision so far as the following fields are concerned:-

1. Human Resource Planning (HRP) 2. Job Analysis 3. Job Evaluation 4. Recruitment and Selection 5. Performance Appraisal 6. Training and Development

7. Employee Compensation 8. Employee Motivation 9. Employee Welfare 10. Industrial Relation 11. Organisational Development 12. Career Development

13. Job Design 14. Performance Management Systems 15. Employee Assistance 16. Labour Relations 17. HR Research and Information Systems and Audit 18. Succession Planning 19. Quality of Working Life 19. Personnel Welfare.

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Also learn about the scope of human resource management as an profession.


Learn about the Scope of Human Resource Management

Scope of HRM – Top 10 Scope: Human Resource Planning, Job Analysis, Job Evaluation, Recruitment and Selection, Performance Appraisal and a Few Others

It has, therefore, been rightly observed by Peter Drucker that “Management is a multipurpose on which has three jobs, two of which are directly related to personnel- Managing a business, managing managers, and managing workers and the work”.

They not only help in determining the rules of the organization but also play a powerful role in interpreting and applying the rules of the system itself. They are expected to enjoy the confidence of both management and employees, which is crucial for effective and efficient operations of the business organization.

The focus of HRM is on people at work. It is indeed a wide area and covers a broad spectrum of activities. A manager, whether he is in charge of production or a marketing function deals with human beings and gets his job done through and with people.

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At last, HRM comprises of three aspects:

a. Personnel Aspects:

This is concerned with manpower planning, recruitment, selection, placement, transfer, promotion, training and development, lay-off and retrenchment, remuneration, incentives, productivity, etc.

b. Welfare Aspects:

It deals with working conditions and amenities such as canteen, crèches, rest and lunchrooms, housing, transport, medical assistance, education, health and safety, recreational facilities, etc.

c. Industrial Relations Aspects:

This covers union-management relations; join consultation, collective bargaining, grievance and disciplinary procedures, settlement of disputes, etc.

The different activities that come within the scope of human resource management are discussed below:

Scope # 1. Human Resource Planning (HRP):

It is the first step of human resource management. HRP is a process through which the company makes an assessment of the present manpower-the number of people employed, number of post vacant, whether there is excess or shortage of staff and prepares plans and policies to deal with them accordingly. It also estimates the future man power requirement. It matches the supply and availability of manpower with the company’s purpose and makes the best person available for the job.

Scope # 2. Job Analysis:

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An important task of HRM is job analysis. It provides the basis for recruitment, training and development of staff. Every job is analysed to identify the inherent requirement of the job – “what the job demands of a worker”. Job analysis provides a detailed picture of the nature of job, the skill and abilities required to perform the job, the duties and responsibilities of the worker required for the job.

This helps in the process of recruitment and selection, to appoint the appropriate person for the job and also facilitates arranging training and development programme for the employees to match their skill and abilities with the job requirement.

Scope # 3. Job Evaluation:

It forms the basis of wage and salary determination. Different jobs are compared and evaluated to determine the relative importance of different jobs within the organization. The jobs are compared, graded and ranked. Job evaluation determines how much pay to be affixed to the particular job on the basis of their importance in the organisation functioning. This helps to determine a fair wage and salary and to determine a rational pay structure.

Scope # 4. Recruitment and Selection:

The company on the basis of human resource planning and job analysis identifies the requirement of personnel and explores different internal and external sources from where manpower can be acquired. This process is called recruitment. The right person is selected and put to work.

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The selection process involves steps like receiving applications, tests, interviews, medical examination and final selection. Right selection and placement provides employee satisfaction which improves their productivity and efficiency and benefits the organization.

Scope # 5. Performance Appraisal:

It is a systematic method of evaluating the performance of employees. This helps to assess the efficiency, strength and weakness of the employees. It is a controlling process whereby the employees’ performance is matched with the standard level of performance and remedial measures taken in case actual performance does not meet the standard.

It helps the management in their decision-making relating to promotion, pay hike that may be rewarded if the employee meets standard or outperforms the standard. It also helps the management to decide about the training and development needs for employees, who needs up gradation and development of skill.

Scope # 6. Training and Development:

Human resource management is concerned with arrangement of training and development programme for the newly appointed staff as well as for existing employees. This helps to enhance the qualitative and quantitative performance of the work force.

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Training helps the employees to cope up with the changing technological and other internal and external work situations. Training and development make employees excel in their present post as well as make them competent for future higher job responsibilities.

Scope # 7. Employee Compensation:

Human resource management performs the function of determining the pay structure for different employees on the basis of qualification, efficiency, experience, nature of the job. It also determines rewards and incentives to be paid for their contribution towards the organisation.

Scope # 8. Employee Motivation:

Motivation of employees is essential for retention and sustenance of employees within the organisation. Motivation plays an important role in management of personnel. It helps to improve productivity of personnel. There are different ways by which employees may be encouraged. Recognition and reward for performance, promotion, pay-hike, and other monetary and non-monetary rewards motivate the employees.

Scope # 9. Employee Welfare:

Human resource management focuses on the welfare of employees by providing canteen facilities, creches, rest and lunch rooms, housing, transport, medical assistance, education, health and safety, medical care, sickness benefits, recreation facilities.

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It aims at improving the quality of work life by providing a better environment worth working, job security, flexible working hours, eliminating workplace hazards, which will have a positive impact on the productivity and quality of work. Along with monetary benefits provided to employees these non-monetary benefits improves the morale of the employees and motivates them.

Scope # 10. Industrial Relation:

Labour unrest, conflicts between the work groups and between workers and management over issues like low wage, bad work environment are common problems that must be handled carefully by establishing a balance between the worker’s interest and interest of the organisation and management. Human resource management considers establishment and maintenance of harmonious and cordial relation between employer and employees.

This is achieved through careful interactions with labour or employee unions, addressing their grievances and settling the disputes effectively through negotiation, joint consultation, collective bargaining, in order to maintain peace and harmony in the organization.


Scope of HRM: Quick Notes

The spectrum of human resource management can be studied under three aspects discussed below:

(i) Labour or Personnel Aspect – It is concerned with recruitment, selection, placement and training of employees, and also their remuneration, appraisal, promotion, productivity, etc.

(ii) Welfare Aspect – It is concerned with working conditions and amenities such as canteens, crèches, housing, schools, and recreation for the welfare of employees.

(iii) Industrial Relations Aspect – It is concerned with employer-employee relations including trade union negotiations, settlement of industrial disputes, joint consultation and collective bargaining.

In order to contribute to the organisational objectives, human resource management undertakes a range of personnel activities which include:

(i) Human resource or manpower planning, i.e., determining the number and kinds of personnel required to fill various positions in the organisation.

(ii) Recruitment, selection and placement of personnel, i.e., employment function.

(iii) Training and development of employees for their efficient performance and growth.

(iv) 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.

(v) Appraisal of performance of employees and taking corrective steps such as provision of training and transfer from one job to another.

(vi) Motivation of workforce by providing financial incentives and avenues of promotion.

(vii) Provision of social security and welfare services for the employees.

(viii) Review and audit of personnel policies, procedures and practices of the organisation.


Scope of HRM – Developed by American Society for Training and Development

The Human Resources Management Model developed by the American Society for Training and Development (ASTD) integrates the nine areas or scope of human resource management.

These areas include the following:

(i) Training and Development.

(ii) Organisation Development.

(iii) Organisation/Job Design.

(iv) Human Resource Planning.

(v) Selection and Staffing.

(vi) Personnel Research and Information System.

(vii) Compensation/Benefits.

(viii) Employee Assistance.

(ix) Union/Labour Relations.

The above areas have been termed spokes of the wheel. Each area contributes to the human resource outputs – (1) quality of work life, (2) productivity, and (3) readiness for change. As a matter of fact, these are the three fundamental objectives which every manager must keep in mind while managing the human resources.

Quality of work life (QWL) is a multifaceted concept which implies a work environment where an employee’s activities become more important. It involves implementing policies and procedures that make the work more rewarding for the employee. These include autonomy, recognition, belonging, development, external rewards, etc.

Productivity relates to the quantity or volume of the product or service that an organisation produces. It is the amount of work that is being done in the organisation in terms of how much and how well. Higher productivity is what makes an organisation thrive. Accordingly, productivity improvement programs are becoming more popular with organisations.

Change is a law of life in both our private and work lives. At the work place, we must be aware that changes will occur. The change might be subtle, such as getting a new boss. Or it might be a major endeavour, such as an organisation installing a computer system for the first time for automating manual operations.

Change rarely comes easily; in some cases, it is resisted because of some fears. To reduce the fears associated with change, training can also play a big role. In fact, it is training that can make people ready for change and provide a competitive advantage to the organisation operating in a global environment.


Scope of HRM – According to Indian Institute of Personnel Management (IIPM)

HRM is concerned with the ‘people’ dimensions of the organisations. The organizational objectives can be best attained by acquiring human resource, develop their skills, motivate them for high performance and ensure that they continue to maintain their commitment and loyalty towards the high performance. The scope of HRM is very vast. It covers all the activities in the working life of an employee.

The scope of HRM is very broad. It is always being enriched by the addition of innovative things.

According to the Indian Institute of Personnel Management (IIPM), the scope of HRM is described below:

i. Personnel Aspect:

Personnel aspect is concerned with human resource planning, job analysis, recruitment, selection, placement, induction, training and development, lay-off, retrenchment, compensation, incentives, morale and productivity, etc.

ii. Welfare Aspect:

Welfare aspect deals with organizational environment especially the working conditions and amenities such as canteen, crèches, first-aid, drinking water, lunch room etc. These are all intramural welfare facilities provided within the premises of the organization. Welfare aspect is also concerned with extra mural welfare facilities such as transportation, medical assistance, education, safety, and recreation facilities.

iii. Industrial Relations Aspect:

Industrial relations aspect focuses on union management relations, joint consultation, collective bargaining, grievances, and dispute settlement mechanisms for example conciliation, arbitration and adjudication (labour court, industrial tribunal and the national tribunal).

The activities that come under the purview of HRM are:

1. Human Resource Planning – This element involves determining the organisations human resource needs, strategies, and philosophies. It involves analysis of the internal and external factors like skills needed, number of vacancies, trends in the labour market etc.

2. Recruitment and Selection – Recruitment is concerned with the developing the pool of candidates in the line with the human resources plan. Selection is the process of matching people and their career needs and capabilities with the jobs and career paths. It ends with the ultimate hiring of the candidate.

3. Training and Development – This involves identification of individual potentialities and helping in the development of key competencies through planned learning process. The competencies are to be developed to enable individuals to perform current as well as future jobs.

4. Organisational Development – This element ensures healthy inter and intra unit relationships. It helps work groups in initiating and managing change. The organisational development also falls under the purview of human resource management.

5. Career Development – It is assuring an alignment of the management. It is a process of achieving an optional match of individual and organisational needs.

6. Job Design – This element defines the tasks, authority, and systems of a job. It also ensures integration of individual jobs across the unit.

7. Performance Management Systems – The performance management systems ensure linkages between individual and organisational goals. It aims at ensuring that every individual’s efforts and actions support the goals of the organisation.

8. Compensation and Benefits – This element focuses on a fair, consistent, and equitable compensation and benefits to the work force.

9. Employee Assistance – The focus of this element is to provide problem solving or counselling to individual employees. The purpose is to help employees in overcoming the personal and job related problems.

10. Labour Relations – This variable assures healthy union – organisation relationship. It aims at creating an environment of industrial peace and harmony.

11. HR Research and Information Systems and Audit – This element ensures a reliable and full proof HR information base. It not only evaluates personnel policies and programmes but also highlights the need and areas of change.


Scope of HRM – As a Profession

The scope of HRM is indeed vast. Any HR department and personnel executives typically perform a variety of roles in accordance with the needs of a situation. The HR manager plays multiple roles such as those of a researcher, a counsellor, bargainers, a mediator, a peace-maker, a problem-solver, and so on.

All major activities in the working life of an employee — from the time of his entry into an organization until he leaves the organizations — come under the purview of personnel management. The functional areas of HRM as outlined by Northcott are – (a) Employment, (b) Selection and training, (c) Employee services, (d) Wages, (e) Industrial relations, (f) Health and safety, and (g) Education.

HRM may be regarded as a profession by many even though it does not possess all the characteristics of a profession. Before examining whether it is a profession or not, it is necessary to identify the essential attributes of a profession.

1. Specific Body of Knowledge:

There should be a specific body of knowledge for any profession. HRM has developed as a distinct body of knowledge. The complexity of managing enterprises has been adding new knowledge to the existing fund of knowledge. Thus HRM satisfies one of the fundamental requirement of a profession.

2. Acquisition of Knowledge:

An individual can enter a profession only after professional studies and through formal training. The sound theoretical knowledge coupled with hands on experience during the course of study helps a professional render efficient and effective service to clients. Therefore high emphasis is laid on initial acquisition of knowledge through formal methods.

In terms of this criterion, HRM cannot be strictly regarded as profession, because entry to the management discipline is not restricted to management graduates. Persons pursuing any discipline is eligible to pursue a management discipline or any special branches of the management discipline.

3. Professional Association:

An occupation which claims professional status should have an association. A representative body of professionals is needed to regulate and develop the professional activities. The body should prescribe the criteria for an individual to become a member of the association. There is a no single association unifying all HR professionals under one umbrella though there are handful of HR associations in India like National Institute of Personnel Management and other associations of HR professionals. Hence, HRM cannot be strictly termed as pure profession.

4. Ethical Code:

Some ethical standards are prescribed for every profession. Every member is expected to conform to these standards. The ethical code regulates the extent of power that can be exercised by individual members. Since it is likely that a member by virtue of expertise in a given profession can misuse his power, code of ethics is needed to regulate their power. Besides the code of conduct enables a client to know the standard of service provided by the professionals.

But as far as HRM is concerned, there is no universally acceptable ethical code for HR professionals throughout the world. But managers are supposed to be socially responsible and expected to protect the interest of stakeholders like customers, suppliers, financiers, creditors, Government and general public. Nonetheless, practice of ethical code by HR professionals in the absence of a single representative association is meaningless.

5. Service Motive:

Service motive emphasises that professionals should keep social interest in their mind while charging fees for their professional service. Monetary value of services rendered cannot be measured precisely in the absence of market mechanism except competition among the professionals themselves.

Even though professionals can charge higher fees by virtue of his expert knowledge, their service is truly measured not in terms of money but in terms of social service they render. This is true for HRM too. Management is an integration force and its contribution to society by way of integrating various resources into productive units is more significant for the stability of society. This integration function is priceless.


Scope of HRM – In the Modern Times

The scope of HRM in the modern times is very wide and ever growing. In the changing environment, all organizational systems have become a part of global village. Path breaking researches in behavioral sciences have enabled us to use new techniques of recruiting, compensating, training and developing the human resource. These developments have led to a great increase in the scope of HRM.

The Indian Institute of Personal Management has specified the scope of HRM as a discipline which looks into the following dimensions:

(a) The Labour Dimension or Human Resource Dimension:

HRM is concerned with all aspects of manpower planning, recruitment, selection, placement, induction, transfer, promotion, demotion, train­ing, layoffs, development, retrenchment, wages and salaries etc.

(b) The Employee Welfare Dimension:

HRM is concerned about the overall welfare of employees. It is the responsibility of HRM to see the working conditions and the workplace are congenial. There is proper housing and transportation facility for employees. There is medical aid available in case of any mishap on the job. HRM has to also look into the adequacy of facilities like wash rooms, dining rooms, recreation rooms, canteen, library etc.

(c) The Industrial Relation Dimension:

This dimension is related to the organization’s relations with employ­ees. It means that HRM deals with unions of employees, consults them and negotiates with them the terms of their employment contracts. HRM also initiates disciplinary actions against destructive employees and handles the grievances of employees at all levels.

The American Society for Training and Development has defined the Human Resource Management Model as a system with nine sub-sys­tems. The model explains that every sub-system works in an interac­tive fashion to manage the human resource of an organization.

The sub-systems are as follows:

(i) Training and development – HRM has to look after all training programs for selected employees to develop them for excellence in job.

(ii) Organizational Development – OD is a method which aims at changing the attitudes, values and beliefs of employees so that employees can improve the organization. This program is almost always handled through HR, whose staff has the specialized knowledge and networks required to implement OD.

(iii) Organization /Job Design – This subsystem of HR defines the tasks, authority and responsibility relationships in the organization. It integrates all divisions of the organization and also connects indi­vidual employees to their job.

(iv) Human Resource Planning – HR Planning is an integral part of various strategy and HRM. This subsystem takes care of all fun­damental decisions regarding personnel and whether they can be met with internal sources or not. External sources are used only after HR manager suggests.

(v) Selection and Staffing – Careful scrutiny of all information sup­plied by the candidate is the work of HRM. After this, the next work of HR revolves around putting the best people for the job.

(vi) Personnel Research and Information System – The focus of this sub-system is to develop a personnel information base. This help in compensating, promoting and motivating them.

(vii) Compensation Benefits – This sub-system of HR measures the work with compensation so that employees got fair and consistent wages/ salary.

(viii) Employee Assistance – This sub-system helps employees get over their fear of failure in the organization. Proper counselling is given by experts to build up their self-confidence to work in the organi­zation and solve their individual problems themselves.

(ix) Union/Labour relations – This subsystem assures that there is a very healthy employer-employee relationship in the organization where regular employer interaction with labour unions takes place.

The above subsystems of HRM work in an integrated manner to give competitive edge to the organization.


Scope of HRM – Explained by Traccy

The scope of Human Resource Management is a wide phenomenon.

It studies various aspects, which is discussed in the following:

(1) It Mainly Concerned on Welfare Aspect:

Welfare aspect dealing with working conditions and provision of amenities. Housing, transport medical assistance, education, health and safety are the most important examples of welfare aspect

(2) Industrial Relations Aspect:

Human Resource Management is also playing a vital role in industry. It aims to make a good cooperation between the manager and worker. It mainly covers union management relations, joint consultation, collective bargaining, grievance, settlement of disputes, etc.

(3) On Personnel Aspect:

The theory of Human Relation Management also basically deals with the personnel aspect of the employees. It mainly concerned with manpower planning, recruitment, selection, placement, transfer, promotion, framing and develop­ment, remuneration, incentives, productivity, etc.

Again the scope of Human Resource Management is basically related with employee hiring, employee and executive remuneration, employee motivation, employee maintenance, industrial relations, prospects of Human Resource Management total quality management organisational development and so on.

Traccy explains some of the scope of Human Resource Management:

(a) Recruitment, selection, and task assignment

(b) Orientation and induction programmes imparting relevant information;

(c) Compensation including all compensable factors;

(d) Employee benefits, monetary and non­monetary; and

(e) Succession planning (upward mobility of personnel via promotions).


Scope of HRM – Explained!

Human resources management (HRM) is managing (planning, organising, directing and controlling) the functions of employing, developing, compensating and utilising human resources, resulting in the creation and development of human and industrial relations which would shape the future policies and practices of human resource management with a view to contribute proportionately (due to them) to the organisational, individual and social goals.

The scope of HRM is comparatively wider with enhanced vision so far as the following fields are concerned:

1. Systematic recruitment procedure

2. Decentralisation of decision making

3. Continuous improvement to achieve better results

4. Quality of working life

5. Emphasis on training and development

6. Emphasis on result-oriented system for employees

7. Performance appraisal and promotion

8. Optimum human resource planning

9. Job analysis and job description, and

10. Personnel welfare.

Management Development Programme/Executive Development Programme is a planned, systematic and continuous process of learning and growth by which managers are able to enhance their conceptual and analytical skills, which help them in managing their employees in a better way.

It is primarily concerned with improving the performance of managers by giving them stimulating opportunities for growth and development.


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