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 Unit I Human Resource Management 1 Prof Mamatha, VVISM

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Unit – I 

Human

Resource Management

1Prof Mamatha, VVISM

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Meaning and Definition

HRM is a management function that

helps managers recruit, select, train and

develop members of an organisation.

2Prof Mamatha, VVISM

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  HRM Definition…… 

A series of integrated decisions that

form the employment relationship; their quality contributes to the ability of the

organisations and the employee to

achieve their objectives.

3Prof Mamatha, VVISM

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  HRM Definition…… Is concerned with people dimension in

management. Since every organisation is

made up of people, acquiring their 

services, developing their skills,motivating them to higher levels of 

 performance and ensuring that they

continue to maintain their commitment tothe organisation are essential to achieving

organisational objectives.

4Prof Mamatha, VVISM

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 HRM Definition…… 

Management is the planning, organising,

directing and controlling of the

 procurement, development, compensation,integration, maintenance and separation of 

human resources to the end that individual,

organisational and social objectives are

accomplished.

5Prof Mamatha, VVISM

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Scope of HRM

• HR Planning• Job analysis and Design

• Recruitment and Selection

• Orientation and Placement,

• Training and Development

• Performance appraisal and Job Evaluation

• Employee and Executive Remuneration

• Motivation and communication• Welfare, Safety and Health

• Industrial Relations (IR)

6Prof Mamatha, VVISM

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Importance of HRM

• Social Significance

• Professional Significance

• Significance for individual enterprise

7Prof Mamatha, VVISM

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Importance of HRM

Social Significance

• Balance the jobs available and job seekers

• Provide suitable and productive employment• Maximise utilisation of the resources effectively

• Eliminate waste or improper use human resources

• Help people make their own decisions

8Prof Mamatha, VVISM

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Importance of HRM

Professional Significance

• Maintain dignity of the employee as human

• Provide maximum opportunities for personaldevelopment

• Provide healthy relationship to different work groups

• Improve skills and capacities

• Minimise wrong postings, allocate work properly

9Prof Mamatha, VVISM

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Importance of HRM

Significance for Individual Enterprise

• Create right attitude among employees through

effective motivation• Utilise the available human resources effectively

• Secure co-operation of the employees: achieve goals, psychological needs- love, affection, belongingness,

esteem and self actualisation

10Prof Mamatha, VVISM

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Difference between HRM & PM 

• HRM views people as an important source

or asset to be used for the benefit of 

organisation, employees and the society.

• Philosophy of mutuality: mutual goals,

mutual respect, mutual rewards and mutual

responsibilities.

• Shifting to SHRM

11Prof Mamatha, VVISM

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Difference between HRM & PM 

• PM has limited scope and an inverted orientation

• Viewed labour as a tool for benefits of theorganisation

• Personnel Dept not respected, no productiveemployees

• PM treated as routine activity meant to hire newemployee and maintain personnel records

•  Never part of strategic management of business.

12Prof Mamatha, VVISM

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Difference between HRM & PM

Dimension Personnel Human Resource

EmploymentContract

Written,delineated

 Aim to gobeyond contract

Rules Clear Outlook,Impatience

Guide to Mgnt. Action

Procedures Business Needs

Behaviourreferent

Norms/Customs andPractices

 Values/Missions

13Prof Mamatha, VVISM

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Difference between HRM & PM

Dimension Personnel Human Resource

Managerial/Labour task 

Monitoring Nurturing

Key Relations Labour

Management

Customer

Initiatives Piecemeal(slow)

Integrated

Management Role Transactional TransformationalLeadership

Speed of decision Slow Fast

14Prof Mamatha, VVISM

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Difference between HRM & PM

Dimension Personnel Human Resource

Communication Indirect Direct

PrizedManagement skill

Negotiation Facilitation

Selection Separate,Marginal task 

Integrated, keytask 

Pay Job Evaluation

(Fixed grades)

Performance

basedConditions Separately

negotiatedHarmonisation

15Prof Mamatha, VVISM

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Difference between HRM & PM

Dimension Personnel Human Resource

LabourManagement

Collective barg-aining contracts

Individualcontracts

Job categoriesand grades

Many Few

Job design Division of labour Team work 

Conflict handling Reach temporary

truce

Manage climate

and cultureTraining & Development

Controlled accessto courses

Learningcompanies

16Prof Mamatha, VVISM

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Difference between HRM & PM

Dimension Personnel Human Resource

Interventionfocus

Personnelprocedures

Wide ranging-cultural, structuraland personnelstrategies

Respect foremployees

Labour treatedas tool:

expendable andreplaceable

People are treatedas assets to

benefitorganisation/employees/society

17Prof Mamatha, VVISM

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Difference between HRM & PM

Dimension Personnel Human Resource

Shared interests Organisational

interests areuppermost

Mutuality of 

interests

Evolution Precedes HRM Latest in theevolution of thesubject

18Prof Mamatha, VVISM

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Objectives of HRM - 4

1. Societal:

To be ethically and socially responsible to the needsand challenges of society while minimising the

negative impact of such demands upon theorganisation.

2. Organisational:

To recognise the role of HRM in bringing aboutorganisational effectiveness.

19Prof Mamatha, VVISM

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Objectives of HRM

3. Functional:To maintain the department‘s contribution at alevel appropriate to the organisation‘s needs.

4. Personal:

To assist employees in achieving their personalgoals, at least insofar as these goals enhance the

individual‘s contribution to the organisation.

20Prof Mamatha, VVISM

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HRM Objectives and Functions

• HRM Objectives

1. Societal

• Supporting Functions

1.Legal Compliance

2.Benefits

3.Union management

relationship

21Prof Mamatha, VVISM

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HRM Objectives and Functions

• HRM Objectives

2. Organisational

• Supporting Functions

1.Human Resource Planning

2.Employee Relations

3.Selection

4.Training & Development

5.Appraisal

6.Placement7.Assessment

22Prof Mamatha, VVISM

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HRM Objectives and Functions

• HRM Objectives

3. Functional

• Supporting Functions

1.Appraisal

2.Placement

3.Assessment

23Prof Mamatha, VVISM

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HRM Objectives and Functions

• HRM Objectives

4. Personal

• Supporting Functions

1.Training & Development

2.Placement

3.Assessment

4.Compensation

24Prof Mamatha, VVISM

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Image & Qualities of HR Manager 

• Fairness & Firmness

• Tact and resourcefulness

• Sympathy and consideration• Knowledge of labour other terms

• Broad Social outlook 

• Competence

25Prof Mamatha, VVISM

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HR Policies

• A policy is plan of action. Is a statement of intentioncommitting the management to general course of action. Policy contains HR programmes, expressionof philosophy and principles.

• Policy are required for…… 

 basic needs, consistency in treatment & continuity

26Prof Mamatha, VVISM

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Evolution of HRM

• HRM emerged in 1970s

• Kautilya‘s Arthashastra in 4th BC

• Babylonian Code of Hammurabi 1800 BC

‗minimum wage rate‘ & ‗incentive wage plan‘ • In India since 1920: First world war, emergence of 

trade union

• The Royal Commission (1931): Labour Welfare

Officers : Selection of workers and settle grievances.

27Prof Mamatha, VVISM

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Evolution of HRM

• Factories Act (1948) Welfare officers compulsoryin industries employing 500 employees

• IIPM  –  Kolkata, NILM in Mumbai : (Jute andtextiles)

• Second World War : increased expectations of theworkers: IR and Personnel admn integrated as PM

• 1970: Shift from welfare to efficiency.

• 1980: HRM and HRD Challenges• 1990: Human value and productivity through

 people.

• 2000: Shifting to SHRM28Prof Mamatha, VVISM

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Demand & Supply Gap

HRP

Demand CompareSurplus

Shortage

Supply Compare

Surplus

Shortage

Prof Mamatha, VVISM 29

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Forecasting Personnel Needs

• Trend Analysis   –   studying variations in firm‘s 

employment levels over the last few years.

• Ratio Analysis   –   making forecasts based on

historical ratio between Causal factor (like salesvolume) and the number of employees required 

• The Scatter Plot  –  two variables are related

• Computerized Forecasts  –   more variables takeninto consideration

Prof Mamatha, VVISM 30

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Determining the relationship between

hospital size and number of nurses

Size of hospital

(no. of beds)

Number of 

Nurses

200 240

300 260

400 470

500 500

600 620

700 660

800 820

900 860

Prof Mamatha, VVISM 31

0

100

200

300

400

500

600

700

800

900

1000

   N  u  m   b  e  r   f  n  u  r  s  e  s

Hospital Size (no. of nurses)

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Forecasting supply of inside candidates

• Manual systems and Replacement charts

• Computerized information systems• The matter of privacy

Forecasting the supply of outside candidates

• From magazines• From web portals

• etcProf Mamatha, VVISM 32

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 Any Queries???

Prof Mamatha, VVISM 33

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Summing up

• Definition

• Difference between HRM & PM

• Evolution• Objectives

• Scope

• Importance• HR policies

• Demand & Supply forecasting techniques

Prof Mamatha, VVISM 34

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Unit II

Employment of Human Resources

Prof Mamatha, VVISM 35

M i H R

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12 –

36

Managing Human Resources

• Human Resource (HR) Planning

 – The process by which managers ensure that they have the

right number and kinds of people in the right places, and

at the right times, who are capable of effectively and

efficiently performing their tasks.

 – Helps avoid sudden talent shortages and surpluses.

 – Steps in HR planning:

• Assessing current human resources

• Assessing future needs for human resources• Developing a program to meet those future needs

Prof Mamatha, VVISM

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12 –

37

Current Assessment

• Human Resource Inventory – A review of the current make-up of the

organization‘s current resource status

 – Job Analysis• An assessment that defines a job and the behaviors

necessary to perform the job.

 – Knowledge, skills, and abilities (KSAs)

• Requires conducting interviews, engaging in direct

observation, and collecting the self-reports of 

employees and their managers.

Prof Mamatha, VVISM

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Job Analysis & Design

38Prof Mamatha, VVISM

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Objectives

• Establish and document the job relatedness of employment

• Produce a basic job description of the job to

facilitate the selection of appropriate personnel• Determine training needs

• Form work groups and teams

• Determine compensation

• Evaluate performance

• Improve quality and productivity39Prof Mamatha, VVISM

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Various aspects of a job to be

analyzed

• Duties and tasks

• Environment

• Tools and equipment

• Relationship

• Requirements

40Prof Mamatha, VVISM

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Job Description

• JD is a written statement of the duties,responsibilities, required qualification, and

reporting relationships of a particular job.

• It includes the information about workingconditions, equipment used, knowledge, and

skills needed, and relationships with other 

 positions.

Produce an outline of the broad responsibilities (rather than detailed tasks) involved inthe job.

41Prof Mamatha, VVISM

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Job Specification

• Specifies the minimum acceptable

qualifications required by the individual to

 perform the task efficiently.

• It also specifies not only educational

qualifications but also certain personality

characteristics that may be required specifically

for a job.• Someone will need to do the job as defined in the task analysis and

 job description.

42Prof Mamatha, VVISM

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Job Evaluation

• The relative value of each job in an

organization.

• It basically serves the purpose of 

compensation procedures.

• It is useful to tool for making decisions

about the compensation to be attached with

a particular position.

43Prof Mamatha, VVISM

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Job Design

• Job design has emerged as an important

area of job analysis. It is based on growing

conceptual and empirical base and hascommand research attention and is being

widely applied to actual practice of 

management

44Prof Mamatha, VVISM

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Job Rotation

• An alternation to boredom in work place is

 job rotation.

• Job rotation implies moving of employees

from one job to another without any

fundamental change in the nature of job.

• The employee may be performing different

 jobs that are of similar nature.

45Prof Mamatha, VVISM

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Job Enlargement

• It involves adding more tasks to a job. It is

horizontal expansion and increase jobs scope

and gives a variety of tasks to the jobholder.

• It is essentially adding more tasks to a single

 job.

• It definitely reduces boredom and monotony

 by providing the employee more variety of tasks in the job.

46Prof Mamatha, VVISM

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Job Enrichment

• Another approach to designing jobs is jobenrichment.

• Job enrichment involves vertical expansion of 

 job by adding more responsibilities andfreedom to it.

• Job enrichment is the type of expansion of a

 job that gives employees more challenge, moreresponsibility, and more opportunity to grow

and contribute his or her ideas to the

organization's success.47Prof Mamatha, VVISM

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Recruitment

48Prof Mamatha, VVISM

Definition & Meaning

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Definition & Meaning

• ―How to Attract a Pool of Candidates Who are

Qualified, Diverse, and Interested in the Job YouHave Open‖ 

• Recruitment is the process of acquiring

applications for specific positions to be filled inthe organization. In other words it a process of 

searching for and pooling of applications for jobs,

so, that the right people may get selected.• A process for searching for prospective employees

and stimulating and encouraging them to apply for 

 jobs in the organization.49

Sources of Recruitment

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Sources of Recruitment• Internal Sources

 – Promotions from within – Employee referral

 – Former employees

 – Previous applicants

• External Sources

 – Walk-in/write-in

 – Advertising – Employment exchanges

 – Campus Recruitment

 – Professional Associations–

50

Th “5 W’ ” f R it t

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• What is the job / Position ?

• Who do you want to fulfill this

requirement ?

• Where will you find the

 person/people to do it .?

• What will you do to make them

volunteer for your organization?

• Why will they volunteer for you ?( i.e what will motivate them to come

on board with you . ?)

The “5 W’s” of Recruitment

51Prof Mamatha, VVISM

Recruitment Procedure

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52Prof Mamatha, VVISM

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The secret to employeeattraction is employee retention.

 If a compnay has what it takes

to keep its existing employees satisfied and productive, it  similarly has what it takes tobring in new talent.

Retain your employee to create the difference 

53Prof Mamatha, VVISM

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Selection

54Prof Mamatha, VVISM

S l ti

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Selection

• Selection involves a series of steps by which thecandidates are screened for choosing the most suitable persons for vacant posts.

• The process of selection leads to employment of 

 persons who possess the ability and qualifications to perform the jobs, which have fallen vacant in anorganization.

• The basic purpose of the selection process is to choose

right type of candidates to man various positions in theorganization. In order to achieve this purpose, a well-organized selection procedure involves many steps and

at each step, unsuitable candidates are rejected.

55Prof Mamatha, VVISM

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The Challenge

• Selection is a critical process• Locating The Right Person

• Requires a huge investment of money to get

right types of people.• Structure of Selection Process that helps

companies to test for fit

• Employment Tests to rightly judge thecapabilities of candidates

• Selecting people who possess the ability and

qualifications to perform the jobs. 56Prof Mamatha, VVISM

S l ti P d

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Selection Procedure

• Preliminary Interview

• Application Blank/ Receiving Applications

• Screening of Applications

• Employment Test

 – Intelligent tests

 – Aptitude tests

 – Personality tests

 – Projective tests

 – Interest tests

 – Achievement tests

 – Other tests

• Selection Interview (Structured/Unstructured/Stress)

• Physical Examination

• Checking References

• Final Selection

57Prof Mamatha, VVISM

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Placement Procedures

58Prof Mamatha, VVISM

Obj i

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Objectives

• Remove fears – The job, its content, policies, rules and regulations.

 – The people with whom he is supposed to interact

 – The terms and conditions of employment

• Creates a good impression

 – Adjust and adapt to new demands of the job – Get along with people

 – Get off a good start

• Organizational issues – History of the Company

 –  Names and titles of key executives – Probationary period

 – Disciplinary procedure

 – Employee hand book 

 – Safety steps

 – Etc. 59Prof Mamatha, VVISM

Obj ti (C td)

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Objectives (Contd)

• Employee benefits – Pay scales

 – Vacation, holidays

 – Rest pauses

 – Training avenues

 – Counseling

 – Insurance, medical and retirement benefits

• Introduction

 – To supervisors

 – To co-workers

 – To trainers

 – To employee counselors60Prof Mamatha, VVISM

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Objectives (Contd)

• Job duties

 – Job location

 – Job tasks – Job safety needs

 – Overview of jobs

 – Job objectives – Relationships with other jobs

61Prof Mamatha, VVISM

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INDUCTION

Prof Mamatha, VVISM 62

O i t ti / I d ti

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12 –

63

Orientation / Induction

• Transitioning a new employee into theorganization.

 – Work-unit orientation

• Familiarizes new employee with work-unit goals• Clarifies how his or her job contributes to unit goals

• Introduces he or she to his or her coworkers

 – Organization orientation• Informs new employee about the organization‘s

objectives, history, philosophy, procedures, and rules.

• Includes a tour of the entire facility

Prof Mamatha, VVISM

Promotions, Demotions,

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Promotions, Demotions,

and Transfers

• Promotions refer to upward movement of an

employee from the present position to another one

with increased responsibilities, pay, status, and

 prestige.• A transfer is a change of job assignment. It may be

linked with promotion or there may not be any

change at all in a status of responsibilities. Transfer 

is horizontal move.• Demotion is the downward movement of an

employee in the organizational hierarchy with lower 

status and pay.64Prof Mamatha, VVISM

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Separations, Downsizing, Layoff & Retrenchment

• Separations: – Long leave of absence

 – Resignations

 – Retirement

 – Death

• Downsizing, Layoff &

Retrenchment:

 – Suspension of an employee

 – Dismissal of an employee

 – Exit interviews65Prof Mamatha, VVISM

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QUERIES!!!

66Prof Mamatha, VVISM

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Summingup

• HRP

• Job

• Recruitment

• Selection

• Placement

• Induction/Orientation• Promotions, Transfers, Separation, VRS, etc

Prof Mamatha, VVISM 67

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Unit III

Development of Human Resources

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Training & Development

   V   V   I   S   M ,   P

   G   D   M    I

   I   S   E   M ,   H   R   M 

69 

   P  r  o   f   M  a  m  a   t   h  a ,

   V   V   I   S

   M

D fi iti f T i i d

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Definition of Training and

Development

Training is an individual means to help him tolearn how to carry out his present job

satisfactorily.

Development can be defined as preparing theindividual for a future job

-John P. Jkenny

70 Vvism

Purpose of Training

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Purpose of Training

2400 years ago, Confucius declared:

"What I hear, I forget.

What I see, I remember.What I do, I understand.” 

“The purpose of training is to provide

information and skills that participants will usein the real world. Participants must be actively

involved during the session if they're going to

integrate and remember the information” 71Prof Mamatha, VVISM

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Development

Development isn't restricted to training -

it's anything that helps a person to grow, in

ability, skills, confidence, tolerance,

commitment, initiative, inter-personalskills, understanding, self-control,

motivation, and more.

72Prof Mamatha, VVISM

Why Training a bird with wings

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Why Training … a bird with wings 

INFOSYS

 Next Generation Excellerators

Excellent Communication SkillsAdaptive, Adept

Consistent, FlexibleInformed, Inspired, ImaginativeEfficient, Human, HonestRespect for CompetitionEmpowered to scale new domains

People committed to enhancing quality ventures every daySimple solutions to complex problemsWorld Changer, Value creator Powered by intellect and driven by values

73Prof Mamatha, VVISM

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Training & Development Distinctions

Learning

Dimension

Training Development

Who

What

 Non-managers

Technical

Mechnaical Oper.

Managers

Theoretical

Conceptual ideasWhy

When

Specific job

related info.

Short term

General knowledge

Long run74Prof Mamatha, VVISM

Goal of Training &

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Goal of Training &

Development

Microsoft

The goal of Training & Development at Microsoft is

to achieve an optimal match between eachemployee's professional growth and Microsoft's

business objective

75Prof Mamatha, VVISM

TRAINING CYCLE

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TRAINING CYCLE

Step 1Identifying learningrequireme

nts

Step 2Establishi

nglearning

objectives

Step 3Designing

and planning

Step 4Delivering

training

Step 5EvaluatingTraining

76Prof Mamatha, VVISM

Exercise

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e c se

What topics will you decide for Senior Managers,

Middle, Staff and workers -Reasons

 •Communication Skills.Effective Decision Making Skills.Building High Performance Teams to complete projects.Proactive steps to overcome Organizational negativity

.Developing Creative Strategies for complex problems

.Building effective Inter & Intra-personal relationships to getresults. Time Management skills.Emotional Intelligence at work 

.Leadership without Authority

.Professional Assertive Communication

.Stress Management skills

.Conflict Resolution Techniques

77Prof Mamatha, VVISM

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 Assignments

Groups

ArticlesGames

78Prof Mamatha, VVISM

L i Th

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Learning Theory

―A relatively permanent change in behaviour 

that occurs as a practice or experience‖ 

Bernard Bass

79Prof Mamatha, VVISM

Learning Curves

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Learning Curves1.Standard learning curve

( assumption that all learners are alike in their acquisition of knowledge and the task to be learned or information to be

acquired is fairly straight forward)

2. Differing rates of learning

(Those who have difficulty in relating the task to their pastexperience and knowledge, who are not suitably motivated or or 

are affected by other psychological constraints have a slower starte.g.:APDISCOM)

3. Learning Plateau(Learners reach a of standstill-wrong assumption of limit of capacity-learner absorbing/un learning

Solution-Analyse, reinforce, incentive, bridge )

80Prof Mamatha, VVISM

On-the-Job Training

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On the Job Training

• Advantages 

•  No specific facilitiesneeded

• Real life situation/not

simulated• Productivity

• Trainee establishes

relations from start

•  No ‗off -the- job‘ cost 

• Learning can be

controlled

• Disadvantages

• Risk to machines andincrease in scrap

• Part-time instructor may

lack skill in training

• Lack of time due to

 pressure of production

• Psychological pressure

 before experiencedworkers 

81Prof Mamatha, VVISM

Off -the- Job Training

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Off -the- Job Training• ADVANTAGES

• Relaxed atmosphere,awayfrom home and work, no

distractions

• Specific difficulties are

easier to explore• Test hypotheses and ideas

in low risk environment

• Improves morale and

motivation for self-development

• DISADVANTAGES

• Cost of external facilities• Difficulty of simulating

work problems

• Resistance of trainees

 being away fromhome(lengthy training)

82Prof Mamatha, VVISM

The Three Classifications of 

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Information

1.Must know(Essential for success/TNA/e.g.:safety rules, hygiene

requirements)

2.Should know(Relates directly to ‗must know‘, and elaborates e.g.:other 

 practices/not statutory))

3.Could know(Useful background /not directly assist in its effective execution,

e.g.:historical details, future areas of interest, general information)

83Prof Mamatha, VVISM

How Adults Learn?

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How Adults Learn?1.Learning is a voluntary process

(Benefit,T-interesting)2. Responsibility increases learning(increase, learning/retaining)

3. Learning builds on existing knowledge(learning capacity-range of experiences,T-background)

4. Learning moves from simple to complicated(step-by-step,bridging new knowledge to old, verify)

5. Each person learns at his own pace(let the flower blossom on its own)

6. Adults learn best by doing(provide opportunities to do usethe learning, case, game, role play)

84Prof Mamatha, VVISM

“It is vital to a valuable education that independent

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It is vital to a valuable education that independent

critical thinking be developed in the young human

being, a development that is greatly jeopardized by 

overburdening him too much and with too varied

subjects. Overburdening necessarily leads to

superficiality. Teaching should be such that what is

offered is perceived as a valuable gift and not as a hardduty” -Albert Einstein 

Thank you..

85Prof Mamatha, VVISM

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Setting Objectives

Why set objectives?

1. Provide direction(what is to be achieved)2. Emphasize standards(e.g..20 min,5 mistakes)

3. Provide consistency (e.g..overall dev.section)

86Prof Mamatha, VVISM

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Difference between Aims and Objectives

Aims: General purpose which provides a

direction or statement of intent-desired outcome

e.g.: aiming at a target

Objective:spells out how and when this is

attained-fairly explicite.g.:hitting the bulls eye

87Prof Mamatha, VVISM

Who decides the Course

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Objectives?

Senior Management(Without the backing of senior management there can be little

hope of acceptance of any training program-integral part of the

companies philosophy)

Line Management(must feel direct benefit-involve line management in developing

content and course objectives)

Delegates

(win the hearts and minds of delegates-tell the benefits of the

course)

88Prof Mamatha, VVISM

P i t t id i S tti

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Points to consider in Setting

Objectives

1. Realistic

2. Relevant

3. Positive4.Certain

5.Justifiable

89Prof Mamatha, VVISM

Performance Appraisal - Definition

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90

pp

• Performance Appraisal is a process of evaluating an employee’s

performance of a job in terms of requirements

• Performance Appraisal is a process of estimating or judging thevalue, excellence, qualities or status of an object, person or a thing

• Performance Appraisal is a process of evaluating the performanceand qualifications of the employees in terms of the requirements of the job for which he is employed for purposes of administrationincluding placement, selection for promotions, providing financialrewards and other other actions which require different treatmentamong the members of a group as distinguished from actions

affecting all members equally” 

Prof Mamatha, VVISM

Importance and Purpose of PA

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91

Importance and Purpose of PA

• PA provides useful in making decisions regarding various personalaspects such as promotions, merit increases etc.

• PA forms a basis for judging the effectiveness of personnel sub-divisions such as recruiting, selection, training & Compensation

• PA helps easier for managers to see which employees need trainingand counseling.

• PA seeks to provide adequate feedback to each individual for his or her performance

• PA purports to serve as a basis for improving data to managers withwhich they may judge future job assignments and compensation

Prof Mamatha, VVISM

Obj ti f P f A i l

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92

Objectives of Performance Appraisal

• To enable an organisation to maintain an inventory of thenumber and quality of all managers and to identify and meettheir training needs and aspirations

• To determine increment rewards, and provide a reliable indexfor promotions and transfers to positions of greater responsibility

• To maintain individual and group development by informing theemployee of his performance standard

 VVISM

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93

• To suggest ways of improving the employee’s performance

when he is not found to be upto the mark during the review

period

• To identify training and development needs and to evaluate

effectiveness of training and development programs

• To plan career development, human resources planningbased on their potential.

Objectives of Performance Appraisal

Prof Mamatha, VVISM

Criteria’s for assessing performance

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94

Criteria’s for assessing performance

• Quality

• Quantity

• Timeliness

• Cost effectiveness

• Need for Supervision

• Interpersonal impact• Training

Prof Mamatha, VVISM

Approaches to Performance Appraisal

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95

Approaches to Performance Appraisal

•  A Casual, unsystematic and often haphazard approach – This method was used in the past, main basis being seniorityor quantitative measures of quality and quantity of output for the personnel

• Traditional and highly systematic measurement – Employeecharacteristics, employee contributions. The ratings obtainedof separate personnel are comparable.

• Behavioral approach, emphasing mutual goal setting – Supervisor judges and at times critizes the personal.

Emphasis has been laid both by the appraiser and theappraisee.

Prof Mamatha, VVISM

Methods, Techniques or Tools

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96

q

for appraising performance• Methods include Traditional and Modern

Methods

Prof Mamatha, VVISM

Methods of Performance Appraisal

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97

Methods of Performance Appraisal

Modern MethodTraditional Method

Straight Ranking Method

Man-Man Comparison Method

Graphic Rating Scales

Forced Choice Description Method

Forced Distribution Method

Check Lists

Free Form Essay Method

Critical Incidents

Group Appraisal

Field Review Method

 Assessment Centre

 Appraisal by Results

or Management by

Objectives

Human Asset Accounting

Method

Behaviourly AnchoredRating Scales

Prof Mamatha, VVISM

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98

• Straight Ranking Method – This is the oldest and simplest method of 

Performance appraisal, by which man and his

performance are considered as an entity by the rater.

Employees are appraised in order of merit and placedin a simple grouping. This is the simplest method of 

separating the most efficient from the least efficient.

Traditional methods of Performance Appraisal

Prof Mamatha, VVISM

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99

• Man-Man Comparison Method: – This technique was used by the USA army during the

I World War. By this method, certain traits are

selected for the purpose of analysis such as

Leadership, dependence and initiative. A scale isdesigned by the rater for each factor. Each man to be

rated is compared with the man in the scale and

certain scores are awarded to him. This method is

used in job evaluation, and also known as Factor comparison method.

Methods of Performance Appraisal

Prof Mamatha, VVISM

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• Grading method: – Under this system, the rater considers certain

features and marks them accordingly to a

scale. Selected features may be analyticalability, co-operativeness, dependability, job

knowledge, judgement etc

Methods of Performance Appraisal

Prof Mamatha, VVISM

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• Graphic or linear Rating Scale: – Most commonly used method of Performance

appraisal

 – Each person to be rated in this type

 – Employee characteristics such as initiative,leadership, dependability, attitude, creativity,decisiveness etc will be considered for rating

 – Employee contribution includes quantity of work,quality of work, responsibilities, target achievers,attitude towards superiors etc

 – These traits are evaluated on a continuous scale andthe rating is generally subjective.

Methods of Performance Appraisal

Prof Mamatha, VVISM

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• Forced Choice Description Method: – This method was evolved with a great deal of 

research conducted for the military services during

World War II.

 – This attempts to correct a rater’s tendency to giveconsistently high or low ratings to all the employees.

In this the rating elements are sets of pair phrases

relating to job proficiency or personal qualifications.

Methods of Performance Appraisal

Prof Mamatha, VVISM

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• Forced distribution Method – This method evolved by Joseph Tiffin after 

statistical work. This is used to eliminate or 

minimise rater’s bias, so that all personnelmay not be placed at the higher end or lower 

end.

Methods of Performance Appraisal

Prof Mamatha, VVISM

h d f f i l

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• Checklist – Under this method, the rater does not evaluate

employee performance. He supplies reports about theemployees to the HR department

 – Checklist points include• Is the employee really interested in his job?

• Is he regular on his job?

• Is he respected by his subordinates?

• Does he show uniform behaviour to all?

• Does he give recognition and praise to employees for workdone well?

• Does he ever make mistakes?

Methods of Performance Appraisal

Prof Mamatha, VVISM

M h d f P f A i l

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105

• Free Essay Method – Under this method, the supervisor makes a

free form, open-ended appraisal of an

employee in his own words and puts down hisimpressions about the employee. No attempt

is made to evaluate an employee in a

quantitative manner.

Methods of Performance Appraisal

Prof Mamatha, VVISM

M th d f P f A i l

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• Critical Incident Method: – This method was developed following research conducted by the armed

forces in the US during World War II. The basis of this method is theprinciple that “ there were certain significant acts in each employee’s

behaviour and performance which make all the difference betweensuccess and failure on the job.

 – The supervisor keeps a written record of the events that can be easily berecalled and used in the course of a formal appraisal.

 – Feedback is provided about the incidents during performance reviewsession.

 – The collected incidents are then ranked in order of frequency andimportance

 – This method provides an objective basis for conducting a discussion of an individual’s performance 

Methods of Performance Appraisal

Prof Mamatha, VVISM

M th d f P f A i l

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• Group Appraisal Method: – Under this method, employee are rated by an

appraisal group consisting of their supervisor or three

to four other supervisors who have some knowledge

of their performance. – The supervisor explains to the group the nature of his

duties and the group then discusses the standards of 

performance for that job.

 –  Advantage of this method is simple and no bias butthis is time-consuming.

Methods of Performance Appraisal

Prof Mamatha, VVISM

M th d f P f A i l

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• Field Review method: – Under this method, a trainer employee from the

personnel department interviews line supervisors to

evaluate their respective subordinates.

 – The supervisor is required to give his opinion aboutstrengths and weaknesses

 – The appraiser takes complete details and the

supervisor maintains record of this for each

personnel. – This system is useful for a large organisation,

Methods of Performance Appraisal

Prof Mamatha, VVISM

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Modern methods of PerformanceAppraisal

Prof Mamatha, VVISM

Management by Objectives (MBO)

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• This method has been evolved by Peter Drucker.

• MBO is potentially a powerful philosophy of managing and aneffective way of operationalising the evaluation process.

• MBO seeks to minimise external controls and maximise internalmotivation through goal setting between the manager and the

subordinate and increasing the subordinate’s own control of hiswork.

• This strongly reinforces the importance of allowing thesubordinate to participate actively in the decisions that affecthim directly

Management by Objectives (MBO)

Prof Mamatha, VVISM

M t b Obj ti (MBO)

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• MBO has defined as –  A system approach to managing the organisation,

where those accountable for directing theorganisation first determine where they want to takethe organisation.

 –  A process requiring and encouraging all keymanagement personnel to contribute their maximumby achieving the overall objectives

 –  An effort to blend and balance all the goals of all key

personnel and –  An evaluation mechanism

Management by Objectives (MBO)

Prof Mamatha, VVISM

Obj ti f MBO

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• The objectives is to change the behaviour andattitude towards getting the job done.

• It is management system and philosophy that stress

goals rather than methods

• It provides responsibility and accountability and

recognised that employees have needs for 

achievement and self  –fulfilment.

Objectives of MBO

Prof Mamatha, VVISM

Management by Objectives - Process

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• MBO has five steps

 – Set organisation goals

 – Joint goal setting

 – Performance reviews

 – Set checkposts

 – Feedback

Management by Objectives Process

Prof Mamatha, VVISM

Benefits of MBO

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• MBO helps and increases employee motivationbecause it relates overall goals to the individual’sgoals and helps to increase an employee’sunderstanding of where the organisation is and

where it is heading

• Managers are more likely to compete withthemselves than with other managers. This will

reduce internal conflicts

• MBO reduces role conflict and ambiguity.

• MBO provides more objective appraisal criteria.

Benefits of MBO

Prof Mamatha, VVISM

Benefits of MBO

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115

Benefits of MBO

MBO forces and aids in planning

MBO identifies performance deficiences and

enables the management and the employees to setindivisualised self improvement goals and thusproves effective in training and development of people.

MBO helps the individual manager to developpersonal leadership, especially skills of listening,planning, counselling, motivating and evaluating

Prof Mamatha, VVISM

Assessment Centre Method

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116

• The assessment centre concept was initially applied to militarysituations by Simoniet in the German Army in 1930’s and the War selection board of the British Army in the 1960’s. 

• The purpose of this is to test the candidates in a social situationusing number of assessors and variety of procedures.

• In this process, many evaluators join together to judge employeeperformance in several situations with the use of variety of criteria.

•  Assessments are made to determine employee potential for purposeof promotion.

•  Assessment is generally done with the help of couple of employeesand involves a paper and pencil test, interviews and situational

exercises.

Assessment Centre Method

Prof Mamatha, VVISM

Purpose of Assessment Centres

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117

• To measure potential for first level supervision, salesand upper management positions and also for higher levels of management

• To determine individual training and developmentneeds of employees

• To select recent college students for entry levelpositions

• To make an early determination of potential

• To assist in implementing affirmative action goals

Purpose of Assessment Centres

Prof Mamatha, VVISM

Human Asset Accounting Method

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118

• This refers to activity devoted to attachingmoney estimates to the value of a firm’s internal

human organisation and its external customer 

goodwill.

• This is not very popular because two types of 

variable measures must be made over several

years to provide the needed data for the

computation of the human asset accounting.

Human Asset Accounting Method

Prof Mamatha, VVISM

Behaviourly Anchored Rating Scales

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119

• This is a new appraisal technique which hasrecently developed.

• This provides better , more equitable appraisalsas compared to other techniques

• The procedure of BARS is usually five stepped – General critical incidents

 – Develop performance dimensions

 – Reallocate incidents

 – Scale of incidents

 – Develop final instrument

y g(BARS)

Prof Mamatha, VVISM

Advantages of Behaviourly Anchored

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120

•  A very accurate gauge, since BARS isdone by experts in the technique

• Clear standards

• Feedback

• Independent dimensions

• Rater  – independence

g yRating Scales (BARS)

Prof Mamatha, VVISM

 After studying this chapter, you should be able to:

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1. Compare employers‘ traditional and career planning-

oriented HR focuses.2. Explain the employee‘s, manager‘s, and employer‘s career 

development roles.

3. Describe the issues to consider when making promotion

decisions.

4. Describe the methods for enhancing diversity through career 

management.

5. Answer the question: How can career development foster employee commitment?

10 –121Prof Mamatha, VVISM

The Basics Of Career 

M t

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Management

10 –122

Career 

Management 

Career Planning

Career 

Development

Employees’ 

Careers

Prof Mamatha, VVISM

The Employer’s Role in

C D l

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Career Development

10 –123

Realistic JobPreviews

ChallengingFirst Jobs

Networking

andInteractions

Mentoring

Career-Oriented

 Appraisals

JobRotation

Employer’sRole

Prof Mamatha, VVISM

Managing Promotions andTransfers

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Transfers

10 –124

Decision 1:Is Seniority or

Competencethe Rule?

Decision 4: Vertical,

Horizontal, orOther?

Decision 2:How Should

We MeasureCompetence?

Decision 3:Is the Process

Formal orInformal?

Making PromotionDecisions

Prof Mamatha, VVISM

Career Management and

E l C it t

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Employee Commitment

10 –125

Old Contract:  “Do your best and be loyal to us,

and we’ll take care of yourcareer.” 

New Contract:  “Do your best for us and be loyal

to us for as long as you’re here,and we’ll provide you with the

developmental opportunities you’ll need to move on and have

a successful career.”  

Comparing Yesterday’s and Today’sEmployee-Employer Contract

Prof Mamatha, VVISM

Career Management andEmployee Commitment

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Employee Commitment

(cont’d) 

10 –126

CareerDevelopment

Programs

Career-Oriented

 Appraisals

Commitment-oriented careerdevelopment

efforts

Prof Mamatha, VVISM

Career Management andEmployee Commitment

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Employee Commitment

(cont’d) 

10 –127

Career

DevelopmentPrograms

Career-

Oriented Appraisals

Commitment-Oriented

CareerDevelopmen

t Efforts

Prof Mamatha, VVISM

 Attracting and Retaining Older 

Workers

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Workers

10 –128

Create a Culture thatHonors Experience

Offer Flexible Work 

Offer Part-Time Work 

HR Practices

for OlderWorkers

Prof Mamatha, VVISM

Taking Steps to Enhance Diversity:

W ’ d Mi iti ’ P t

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Women’s and Minorities’ Prospects 

10 –129

Take TheirCareer

InterestsSeriously

EliminateInstitutional

Barriers

Eliminate theGlass Ceiling

ImproveNetworking

and Mentoring

InstituteFlexible

Schedules andCareer Tracks

Prof Mamatha, VVISM

Identify Your Career Anchors

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y

10 –130

Technical/

FunctionalCompetence

Managerial

Competence

 Autonomy andIndependence Creativity

Security

Prof Mamatha, VVISM

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Coaching & Mentoring

131Prof Mamatha, VVISM

Personal Coaching

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g

Personal Coaching is a distributed

training and development method

where individuals regularly interact

with and are accountable to

a personal coach

for an extended period of time,

to achieve agreed learning outcomes

132Prof Mamatha, VVISM

Mentoring

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g• Mentoring is a tool that organizations can use to

nurture and grow their people. It can be an informal

 practice or a formal program. Protégés observe,

question, and explore. Mentors demonstrate, explain

and model. The following assumptions form the

foundation for a solid mentoring program.

• Deliberate learning is the cornerstone.

• Both failure and success are powerful teachers.

• Leaders need to tell their stories.• Development matures over time.

• Mentoring is a joint venture.

133Prof Mamatha, VVISM

Mentoring is distinct from coaching

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Mentoring

• Broad

• long-term• level-distant

• cross-functional

•  providing guidance

Coaching

• Job specific

• Short-term• Level-close

• Same-function

• Giving advice

134Prof Mamatha, VVISM

Mentoring is distinct from coaching

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Mentoring is distinct from coaching

Mentors•  Nurture whole person

• Draw forth untapped

talent• Encourage & Inspire

• Guide from the heart

• Accelerate learning &

empowerment

Coaches• Provide job coaching

• Focus on job skills

• Groom for a particular position

• Evaluate performance

• Reward job learning

135Prof Mamatha, VVISM

Evolution

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Evolution 

Traditional • Focus on career 

advancement

• Mentor as protector 

• Single mentor 

• Clone look-alike, think 

alike, act-alike

• Elitist

• Process centred

• Mentors are older, wiser,

more experienced

 New Age• Focus on leadership

• Mentee (protégé) driven

• Multiple mentors• Democratic, potentially

helpful to every member of 

workforce

• Knowledge needs

• Mentees‘ are often better 

educated & technically

competent136Prof Mamatha, VVISM

Why Mentoring

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y g

• Encourages knowledge sharing

• Both parties Develop

• Encourages teamwork 

• Addresses specific issues or skills

• Supplements on-the-job training

• Promotes leadership development 137Prof Mamatha, VVISM

-Global Findings-

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• 75% executives said mentoring played a key role in their 

career …………… ASTD

• Survey of CEO‘s states that one of the top three factors in

their career was mentoring ….. Account Temps survey

• 96% executives said that mentoring is an importantdevelopmental tool……… Account Temps survey

• Mentoring programs have been proven to improve

retention by 20-30% ……… ASTD

• 71% of Fortune 500 companies use mentoring to make

learning occur in their organizations ………(1996)

138Prof Mamatha, VVISM

Zone of Impact

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p

Habits

Behavior 

Mindset

What? Why?

Knowledge

Want ToHow To?Skills Attitude&

Desire

139Prof Mamatha, VVISM

Mentor- Mentee Relationship

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p

A dynamic association or pairing

 between an individual who needs tolearn and another who is willing to

help and guide the learner.

140Prof Mamatha, VVISM

Stages in the Development of Mentoring Relationships

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Mentoring Relationships

Stage 1: The mentor and recipient become acquainted and informallyclarify their common interests, shared values and

 professional goals. Stage 2: The mentor and recipient communicate initial expectations

and agree upon some common procedures and expectationsas a starting point.

Stage 3: Gradually, needs are fulfilled. Objectives are met.

Professional growth takes place. New challenges are

 presented and achieved. This stage may last for months or 

years.

Stage 4: The mentor and recipient redefine their relationship as

colleagues, peers, partners and/or friends.

141Prof Mamatha, VVISM

Mentoring Environment

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 Interpersonal chemistry is important 

• Sense of mutual comfort and equality

• With self-confident people - differences may in fact provide

learning experience

 Need for ground rules & shared expectations 

how, when, where to meet and specific terms for review and

evaluation

 Friendship can get in way of objectivity 

- Can be ended by either party for any reason

- no explanations/justifications required 142Prof Mamatha, VVISM

Types Of Mentoring

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Situational Mentoring

• Short, isolated episodes• Often casual, one-time events

• Responsive to current needs of mentee and/or present situation

• A mentor-initiated intervention

Informal Mentoring

• Voluntary

• Loosely structured, flexible

• Mentee revealed needs

• Mentor may have more than one role in relationship with mentee (supervision, parent, friend)

Formal Mentoring Programs• Driven by organizational needs

• A method for matching mentors with (or assigned to) mentees

• Of fixed duration and based on goal achievement143Prof Mamatha, VVISM

Methods of Mentoring

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The Standard/ Traditional method

The Peer Mentoring Method

The Team Mentoring Method

144Prof Mamatha, VVISM

4 Types of Coaching

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1. Counseling

2. Encouraging & Mentoring

3. Training4. Confrontation

145Prof Mamatha, VVISM

What Mentoring is not

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• a guarantee of advancement• an unlimited resource on tap

• a job locating service

• a means of bypassing supervisors

• a mechanism for providing favouritism or unfair advantage• a way of working outside the system

• A fix for  – seniority/age disparity

 – gender differences

 –  personality clashes

 – different ‗wavelengths‘ 

146Prof Mamatha, VVISM

When mentoring

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g

Deliberate learning is the cornerstone

Success and failure are powerful

teachers

Leaders need to tell their stories

Development matures over time

Mentoring is a joint venture

147Prof Mamatha, VVISM

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"The best mentors are the people in your lifewho push you 

 just a little bit outside your 'comfort zone.' " -- Leigh Curl 

148Prof Mamatha, VVISM

Mentor Competencies

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Trustworthy and open

High Integrity

Active listener 

Catalyst for learning

Commitment builder 

Enthusiasm to share

149Prof Mamatha, VVISM

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“Tell me, and I’ll forget.

Show me, and I may remember.

Involve me, and I’ll understand.” 

150Prof Mamatha, VVISM

The four “C’s” of Coaching 

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Confidence

Control

Concentration

Commitment

151Prof Mamatha, VVISM

To be a good coach you need to:

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Motivate your staff  – empower your employees

Hone your communication skills

Counsel your staff  – stop problem situations before they get out of hand

Exercise good judgment

Utilize available talent – they will bemotivators for other staff 

152Prof Mamatha, VVISM

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"People will forget what you said. People

will forget what you did. But people will never forget how you make them feel." 

Bonnie Jean Wasmund  153Prof Mamatha, VVISM

Dilemmas

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Can Mentoring save us money or improve

profitability?

Shall we allow employees to spend time on

mentoring others when we are thinly resourced?

What if the Mentoring framework becomes a

session to talk personal problems ?

What if the Mentor-Mentee engagement is “not

bearing fruit”

154Prof Mamatha, VVISM

Mentoring Myths

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•  Mentoring is something a mentor does to a protégé

• A good mentor can literally save a life

• Mentors should be of the same ethnic background as

their protégés

• Mentoring is a special, enhance type of management

coaching

• Anyone can benefit from being mentored

155Prof Mamatha, VVISM

Evaluation Of A Mentor Program

Someone in the organization needs to be

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Someone in the organization needs to be

responsible for:Moving the mentor program forward in a positive direction

Providing opportunities for mentors to share their 

experiences and their views about the effectiveness of the

mentor programProviding opportunities for recipients of mentoring to share

their views about the effectiveness of the mentoring program

Addressing any problems or unmet needs that emerge

during the course of the year .

156Prof Mamatha, VVISM

Continued… 

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Some orgainsations might hold:

Hold informal but regular social get-

togethers over lunch

Hold more formal quarterly or monthly

meetings

Hold brief reports which are written or 

given orally

Using a timeline for the current year 

157Prof Mamatha, VVISM

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Mentor's role in experiential learning is like that of 

birds guiding their young in leaving the nest; they 

 support without rescuing, provide scaffolding, and 

have the courage to let learners fail!! 158Prof Mamatha, VVISM

Summing Up

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• Training• Performance Appraisal

• Mentoring

• Career Planning

• Mgt Development, Organization Development,

Executive Development

Prof Mamatha, VVISM 159

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Unit IV

Management of Human Resources &

Industrial Relations

Prof Mamatha, VVISM 160

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COMPENSATION PACKAGE 

161Prof Mamatha, VVISM

What is Compensation ? 

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Compensation is the process of directly and

indirectly rewarding employees on a current or 

deferred basis, for their performance of assignedtasks.

162Prof Mamatha, VVISM

Objectives of Compensation 

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• Legal Compliance with all appropriate laws andregulations

• Cost effectiveness for the organization

• Internal, External and Individual equity for employees

• Performance enhancement for the organization 

163Prof Mamatha, VVISM

Compensation Types 

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DIRECT INDIRECT

Base Pay

Wages

Salaries

Variable Pay

Bonuses

Incentives

Stock Options

Benefits

Medical Insurance

Paid time off  Retirement Pensions

  Worker’s Compensation

164Prof Mamatha, VVISM

Division of Compensation -

Responsibility 

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HR Manager Line Manager 

Develops and

 Administers

Compensation system

Conducts job evaluation

and wage surveys

Develops wage / salarystructures and policies

Attempt to march

performance and rewards

Recommend pay rates

and increment based on

guidelines from HR unit

Evaluate employeeperformance based

compensation purposes

165Prof Mamatha, VVISM

COMPENSATION STRATEGIES 

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• Compensation Philosophies

 – Strategic Compensation Design

 – Compensation and Organizational Culture

 – Cost Effectiveness and Labour Market

Positioning 

• Competency Based Pay

• Broadbanding and Career Development

166Prof Mamatha, VVISM

Compensation Philosophy 

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ENTITLEMENT PERFORMANCE

Seniority Based No raises for length of service

 Across the board raises No raises for longer service poor 

performers

“Guaranteed” movement of scales Market adjusted pay structure

Industry comparisons only Broader Industry comparisons

“Santa Claus” Bonuses Bonuses tied to performance results

167Prof Mamatha, VVISM

Changing CompensationStrategies 

Y t d T d T

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 Yesterday Today Tomorrow

Fixed salary Variable a as add-on

to salary

Low fixed salar , more

variable pay

Bonuses/ erks for 

executives only

Variable a emer in

throughout organization

Variable a common

throughout the organization

Fixed benefits,reward long tenure

Flexible benefits Portable benefits

Company-based

career “moving up”

Industr -based career,

“moving around”

Skill-based, interim

employment

Hierarchical

organizations

Flatter team-based

organizations

Network “virtual”

organizations

“Cookie cutter” a

plans

Total com ensation

(Look at benefits, too)

Customized, inte rated a

s stems; a , benefits,

intangibles

168Prof Mamatha, VVISM

Quartile Strategy 

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Third Quartile Above-Market Strategy Maximum(25% of firms pay above and 75% pay below) 

Second QuartileMiddle-Market Strategy Medium (50% of firms pay above and 50% pay below) 

First QuartileBelow-Market Strategy Minimum (75% of firms pay above and 25% pay below) 

169Prof Mamatha, VVISM

Outcomes from Competency

Based Systems 

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y

Organization-Related

Outcomes

 Employee-Related

Outcomes

Greater workforce flexibility Enhanced employee

understanding of Organisational“big picture”

Increased effectiveness of 

work Team

Greater employee self-

management capabilities

Few bottlenecks in work flow Improved employee satisfaction

Increased worker output Greater employee commitment

170Prof Mamatha, VVISM

DESIGNING EFFECTIVE

COMPENSATION PROGRAM

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Job Analysis(Job Descriptions, Job Specifications)

Job Evaluation

Pay Policies Pay Structures

Performance Appraisal

Individual Pay

Implementation,Communication, Monitoring

Pay Surveys

171Prof Mamatha, VVISM

Salary Structure

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Job Evaluation Results Pay Survey Data

Develop Market Line

Identify Different

Pay Structures

Establish Pay Grades

Compute PayRanges

Revise Pay Grades andRanges as Needed

Compare Current Payto Pay Ranges

172Prof Mamatha, VVISM

COMPENSATION POLICIES AND

PROCEDURES 

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• Know what the competition is doing andbenchmark your structure to reflect competitivepractices for retention and recruitment purposes.

• Salaries should reflect level of responsibilityemployees may have in the organization.

• Form a compensation committee (preferablyrepresented by management and employees).

Contd...173Prof Mamatha, VVISM

COMPENSATION POLICIES AND

PROCEDURES

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PROCEDURES 

• Create a structure where salaries and any

increases reflect company performance as

espoused by the compensation committee.

• Develop and document a general companypolicy and strategy for pay increases.

• Liaison with the compensation committee for 

review, adjustments and approval. 

174Prof Mamatha, VVISM

Team Based Compensation 

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Types of Team Incentives

Same size reward for each team member 

Different size rewards for each team member

Criteria for Best Team WorkSignificant interdependence exists among the work of 

several individuals, and team work and co-operation isabsolutely essential.

Contd.. 175Prof Mamatha, VVISM

Team Based Compensation 

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Difficulties exist in identifying exactly who isresponsible for different levels of performance.

Management wants to create or reinforce team

work and co-operation among employees

Rewards are seen as being allocated in a fair and

equitable manner. 

176Prof Mamatha, VVISM

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Collective Bargaining

177Prof Mamatha, VVISM

The Collective BargainingProcess

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15 –178

• What Is Collective Bargaining? – Both management and labor are required by law to

negotiate wages, hours, and terms and conditions of employment ―in good faith.‖ 

• What Is Good Faith Bargaining? – Both parties communicate and negotiate.

 – They match proposals with counterproposals in areasonable effort to arrive at an agreement.

 – Neither party can compel the other to agree to a proposal or to make any specific concessions.

Prof Mamatha, VVISM

Classes of Bargaining Items

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15 –179

MandatoryItems

IllegalItems

Categories of Bargaining Items

 VoluntaryItems

Prof Mamatha, VVISM

Impasses, Mediation, andStrikes

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15 –180

• An Impasse – Usually occurs because one party is demanding more

than the other will offer.

 – Sometimes an impasse can be resolved through a

third party — a disinterested person such as a mediator or arbitrator.

 – If the impasse is not resolved:

• The union may call a work stoppage, or strike, to put

 pressure on management.

• Management may lock out employees.

Prof Mamatha, VVISM

Strikes

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15 –181

Economic Strike

Unfair Labor PracticeStrike

Wildcat Strike

Sympathy Strike

Types of Strikes

Prof Mamatha, VVISM

Grievances

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15 –182

• Grievance – Any factor involving wages,

hours, or conditions of 

employment that is used as a

complaint against the

employer.

• Sources of Grievances – Discipline

 – Seniority

 – Job evaluations

 – Work assignments – Overtime

 – Vacations

 – Incentive plans

 – Holiday pay

 – Problem employees

Prof Mamatha, VVISM

Summing Up

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• Compensation & Benefits• Employee Grievances

• Collective Bargaining

Prof Mamatha, VVISM 183

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Unit V

Competitive Advantage

Prof Mamatha, VVISM 184

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People Capability Maturity

Model - PCMM

185Prof Mamatha, VVISM

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186Prof Mamatha, VVISM

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187Prof Mamatha, VVISM

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188Prof Mamatha, VVISM

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189Prof Mamatha, VVISM

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EMPLOYEE EMPOWEREMENT

190Prof Mamatha, VVISM

Employee Empowerment

Participative management has become key word

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p g y

in empowermentThe most important concept of empowerment is

to delegate responsibility to the lowest level in

organization.

The management must trust & communicate

with employees

191Prof Mamatha, VVISM

BASIC ASPECTS

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Authority

Control

Responsibility

Accountability

Ownership

192Prof Mamatha, VVISM

Human ResourceSystems

(Rewards, Training)

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Organizational Values/Leadership Action

Organizational Structural

 Job Design

Empowerment

CompetitiveStrategy,

Productivity,Customer service

Continuousimprovement

Actions

FACILITATORS OF EMPOWERED TEAMS

193Prof Mamatha, VVISM

Distinct Features

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Share various management and leadershipfunctions

They plan control and improve their own work 

 processesSet their own goals, inspect their own work 

Coordinate with other teams

Take responsibility for quality

194Prof Mamatha, VVISM

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VVISM

Prof Mamatha, VVISM 195

Knowledge Management

Management Vs Knowledge

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Prof Mamatha, VVISM 196

• Management is an art of getting things donethrough others.

• An area as justified beliefs about relationshipsamong concepts relevant to that particular 

area.

Knowledge Management???

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Prof Mamatha, VVISM 197

• Doing what is needed to get the most out of knowledge resources.

• KM is related to ‗Intellectual Capital‘.(IC = Human Capital + Structural Capital) 

• HC - Body of knowledge company possesses

• SC - Everything remains when employees go home. 

Forces Driving KM

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Prof Mamatha, VVISM 198

• Increasing domain complexity

• Accelerating market volatility

• Intensified speed of responsiveness

• Diminishing individual experience

 Alternative views of knowledge

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Perspectives

onKnowledge

Subjective

View

Objective

View

Knowledge as

a

state of mind

Knowledge as

practice

Knowledge as

an object

Knowledge as

access to

information

Knowledge as

capability

199Prof Mamatha, VVISM

Subjective View

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Prof Mamatha, VVISM 200

• It is socially constructed through interactionswith individuals.

• Knowledge is viewed as an ongoing

accomplishment, which continuously affectsand is influenced by social practice.

Objective View of Knowledge

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Prof Mamatha, VVISM 201

• It is independent of human perceptions and can be structured in terms of a priori categories andconcepts.

• Consequently, knowledge can be located in the

form of an object or a capability that can bediscovered or improved by human agents.

Types of Knowledge

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Prof Mamatha, VVISM 202

1. Procedural or Declarative Knowledge2. Tacit or Explicit Knowledge

3. General or Specific Knowledge

Procedural or Declarative Knowledge

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Prof Mamatha, VVISM 203

• Procedural knowledge focuses on beliefsrelating sequences of steps or actions to

desired/undesired outcomes.

• Declarative knowledge is ‗know what‘, whereas procedural knowledge may be viewed as

‗know how‘.

Tacit or Explicit Knowledge

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Prof Mamatha, VVISM 204

• Explicit knowledge typically refers to knowledge thathas been expressed into words and numbers.

• Such knowledge can be shared formally andsystematically in the form of data, specifications,

manuals, drawings, audio and video tapes, computer  programmes, patents, and the like.

Cont… 

Tacit or Explicit Knowledge

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Prof Mamatha, VVISM 205

• Tacit knowledge includes insights, intuitionsand hunches. This knowledge is difficult to

express and formalize, and therefore difficult

to share.

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Talent Management

206Prof Mamatha, VVISM

TALENT MANAGEMENT

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• Talent Management is a powerful tool thathelps a Company stand out against the

Competition. It is a key business process that

focuses on how the Company manages and

invests in their people to meet the business

needs. With it, the Company can make the best

use of their talent and support the associates‘

development consistently worldwide.

207Prof Mamatha, VVISM

BUILDING ON PEOPLE

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• The future of the Company depends on clear and aligned business goals and the right peopleto successfully implement its strategy.

• Our Talent Management process ensures that

we identify and match talent with Businessrequirements, so that we have the leaders readyand in place to achieve our goals.

208Prof Mamatha, VVISM

ROLE OF MANAGERS IN TM

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• A significant part of ensuring a successfulfuture relies on the role that our current

managers play in identifying and developing

their future successors.

• The TM Process supports Managers in

addressing skill and ability gaps and provides

action plans to close these gaps.

209Prof Mamatha, VVISM

IDENTIFICATION OF TALENT

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• Managers identify key positions and high potential people and review individual

 potential against position requirements.

• Talent Management is the process for identifying our leadership needs and assessing

candidates worldwide.

210Prof Mamatha, VVISM

TALENT MANAGEMENTPROCESS

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• A concrete idea of the requirements of our key positions

• Objective assessments of individual

capabilities• Alignment of each candidate‘s potential and

 possible professional development.

211Prof Mamatha, VVISM

TALENT MANAGEMENTPROCESS

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• Individual Development plans to strengthenthe talent pool.

• A strong pool of candidates for key positions

• Plans to resolve succession gaps or blockages

212Prof Mamatha, VVISM

TALENT MANAGEMENTINTERFACES

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• Talent Management,PerformanceManagement, LeadershipDevelopment and

CompensationManagement work together to ensure thatskilled leaders are in

 place to meet our  business challenges.

213Prof Mamatha, VVISM

TALENT MANAGEMENT

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• Identifies talent requirements based on business challenges

• Assesses individual and organizational

 potential• Reviews talent and identifies key associates

for key positions- short and mid term

214Prof Mamatha, VVISM

TALENT MANAGEMENT

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• Defines coaching and development plans anddevelopmental moves

• Initiates filling of gaps through outside

recruiting• Identifies Future Leaders (long term

candidates for key positions )

215Prof Mamatha, VVISM

LEADERSHIP DEVELOPMENT

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• Grows our talent internally• Reinforces a culture of continuous learning

• Provides leadership education and on-the-job

development

216Prof Mamatha, VVISM

TALENT MANAGEMENT

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• Talent Management provides a cross-functional, bottom-up leadership identification

and development process owned by line

management.

• TM continually identifies leadership

requirements, potential leaders and

developmental and hiring needs

217Prof Mamatha, VVISM

Summing up

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• PCMM• Levels

• HR Practices

• Knowledge Management• Talent Management

Prof Mamatha, VVISM 218

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End of Syllabus

All the Best