manjula-hrm ch1
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HUMAN RESOURCESMANAGEMENT
MBA 1009
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INTRODUCTION TO HRM
A company that loses all its
equipments but retains the skills and
know-how of its workforce could be backin business relatively quickly, but one
that loses its workforce, while keeping
its equipment, will find it much more
difficult to recover.
-Becker, Huselid, Ulrich (2001). The HR
Scorecard
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Contd My main job was developing talent.
I was a gardener providing water and
other nourishments. Ofcourse, I hadto pull some weeds too.
- Jack Welch, former CEO of GE in an
interview with Business Week
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Contd The employee at Taj is viewed as an asset and
is the real profit center. He or she is the very
reason for our survival. The creation of the Taj
People Philosophy displays our commitment to
and belief in our people. We want an
organization with a very clear philosophy,
where we can treasure people and build from
within.
- Bernard Martyris , Senior Vice-President, HR,
Indian Hotels Company Ltd.,
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Contd..
Unlike a factory which churns out goods,FedEx as a service company has onlypeople-couriers to pick up and deliver
goods and document, customerrepresentatives and sales executives. If wehire the right people, train them, equipthem and manage them properly, they willprovide service that will satisfy customers
and in turn those customers will reward uswith business after business that generatesprofits.
- Malcolm Sullivan, MD, FedEx (South Pacific)
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Contd The most important mission for a Japanese
manager is to develop a healthy relationshipwith his employees, to create a family-like
feeling within the corporation, a feeling thatemployees and managers share the same fate.Those companies that are most successful inJapan are those that have managed to create ashared sense of fate among all employees,what Americans call labor and management,and the shareholders.
- Akio Morita, Founder of Sony Corporation inhis biography, Made in Japan.
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HUMAN RESOURCE MANAGEMENT It is a management function concerned with
hiring, motivating and maintaining people in anorganization.
It may be defined as : A strategic approach tomanaging employment relations whichemphasizes that leveraging peoplescapabilities is critical to achieving sustainable
competitive advantage, this being achievedthrough a distinctive set of integratedemployment policies, programmes andpractices. (Bartton & Gold, 2007)
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PM AND HRM
1) Is PM and HRM essentially the sameor different concepts?
2) Is there a difference between HRMand HRD?
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HRM,PM & HRD
HRM is a broad concept, Personnelmanagement (PM) and human resourcedevelopment (HRD) are a part of HRM.
HRM differs from PM both in scope andorientation.
PM has limited scope and an invertedorientation.
HRD is more concerned with trainingand development, career planning anddevelopment, and OD.
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DIFFERENCES BETWEEN HRM &PM
DIMENSION PERSONNEL MANAGEMENTHUMAN RESOURCE
MANAGEMENT
Employment ContractCareful delineation of written
contractsAim to go beyond contract
Rules Importance of devising clear rulesCan do outlook, impatience with
rule
Guide to management
actionProcedures Business need
Behaviour referent Norms/customs and practices Values/mission
InitiativesPiecemeal Integrated
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Contd..DIMENSION
PERSONNEL
MANAGEMENT
HUMAN RESOURCE
MANAGEMENT
Speed of decision Slow Fast
Management role Transactional Transformational leadership
Communication Indirect Direct
Prized management skills Negotiation Facilitation
Conditions Separately negotiated Harmonisation
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Contd..DIMENSION
PERSONNEL
MANAGEMENTHUMAN RESOURCE MANAGEMENT
Labour managementCollective-bargaining
contractsIndividual contracts
Job categories and
gradesMany Few
Job design Division of labour Team work
Conflict handling Reach temporary truce Manage climate and culture
Focus of attention for
interventionsPersonnel procedures
Wide-ranging cultural, structural and
personnel strategies
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ContdDIMENSION PERSONNEL MANAGEMENT
HUMAN RESOURCE
MANAGEMENT
Respect for
employees
Labour is treated as a tool which is
expendable and replaceable
People are treated as assets to
be used for the benefit of
an organization, itsemployees and the
society as a whole
Shared InterestsInterests of the organization are
uppermostMutuality of interests
Evolution Precedes HRMLatest in the evolution of the
subject
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OBJECTIVES OF HRM
Personalobjectives
Functional
objectives
Organisational
objectivesSocietal objectives
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Societal objectives To be ethically and socially
responsible to the needs and
challenges of the society whileminimizing the negative impact ofsuch demands upon the organization.
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Organizational Objectives To recognize the role of HRM in
bringing about organizational
effectiveness.
To make sure that HRM is not astandalone department, but rather ameans to assist the organization withits primary objectives.
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Functional Objectives To maintain the departments
contribution at a level appropriate to
the organizations needs.
The departments level of servicemust be tailored to fit theorganization it serves.
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Personal Objectives
To assist employees in achieving theirpersonal goals, at least in so far as
these goals enhance the individualscontribution to the organization.
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HRM-FUNCTIONSHRM OBJECTIVES
Societal Objectives
SUPPORTING
FUNCTIONS
Legal Compliance Benefits
Union-management
relations
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Contd.Organizational
Objectives Human Resource
Planning
Employee Relations
Selection
Training andDevelopment
Appraisal Placement
Assessment
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ContdFunctional Objectives Appraisal
P
lacement
Assessment
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ContdPersonal Objectives Training and
Development
Appraisal
Placement
Compensation
Assessment
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QUALITIES OF A GOOD HR
MANAGER Fairness and firmness Communication Skills Tactfulness and resourcefulness Sympathy and consideration
Knowledge of labour and other terms Broad social outlook Competence
(Creative thinking, analytical thinking, reasoningobjectively, Problem Solving and Decision MakingAbility)
Leadership- Ability to inspire, motivate and persuade Personal Integrity Academic Qualifications
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EVOLUTION OF HRM IN INDIAPERIOD DEVELOPMENTSTATUS
OUTLOOK EMPHASIS STATUS
1920s-1930s Beginning Pragmatism of capitalists
Statutory,welfare,
paternalism
Clerical
1940s-1960s Struggling forrecognition
Technical,legalistic
Introductionoftechniques
Administrative
1970s-1980s Achievingsophistication
Professional,legalistic,
impersonal
Regulatory,conforming,
impositionof standardson otherfunctions
Managerial
1990s Promising Philosophical Humanvalues,productivity
throughpeople
Executive
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HRM MODEL Nine HR areas identified by ASTD1. Training and Development2. Organization and Development3. Organization/ Job Design
4. HRP5. Selection and Staffing6. Personnel Research and Information Systems7. Compensation/Benefits8. Employee Assistance
9. Union/Labour RelationsThese nine areas have been termed spokes of thewheel in that each area impacts on the HR outputs:QWL, productivity, and readiness for change.
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HRM COMPONENTS
Acquisition HRP Recruitment-
internal & external Employee
socialization
Maintenance
Safety and health Employee/Labour
relations
Development Employee training Mgt. Development Career Development
Motivation Job Design Performance
Evaluations
Rewards Job Evaluations Compensation/Benefits Discipline
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FUNCTIONS OF HRMFUNCTIONS OF HRM
Managerial Operative
Procurement
Development
Motivation
&Compensation
Maintenance
Integration
Emerging issues
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Managerial Function Planning
Organizing
Leading
Controlling
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Operative Functions
1)P
rocurement Functions Job Analysis
HR Planning
Recruitment Selection
Induction & Orientation
Internal Mobility
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2)Development Functions Training
Executive Development
Career Planning & Development Human Resource Development
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3) Motivation & Compensation Job Design
Work Scheduling
Motivation Job Evaluation
Performance Appraisal
Compensation Administration Incentives & Benefits
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4) Maintenance Functions Health & Safety
Employee Welfare
Social Security Measures
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5) Integration Functions Discipline
Teams and Team Works
Collective Bargaining Employee Participation &
Empowerment
Industrial Relations
Trade Unions & EmployeeAssociations
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6) Emerging Issues
Personal Records
HR Accounting
HR Audit HR Research
HR Information Systems
Stress Management & Counseling International HRM
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IMPORTANCE OF HUMANRESOURCES MANAGEMENT
The Strategic Nature
Every organization is comprised of people
Knowledge based economy-People dependent
Hiring and keeping good people is critical tothe success of every organization (TalentAcquisition and Retention)
Harnessing employee commitment and keepingthe workforce engaged
Changing Roles of HR:HR as a change agent
HR as innovator
HR as a strategic partner
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Does HR really create value?
Deloitte & Touch (2002) study titled as Creating Shareholder value through Peopleclearly demonstrated that an organizationsHuman Capital practices represented as much
as 43% of the difference between your marketvalue and your competitors.
Watson Wyatt (1999) Worldwide study onHuman Capital Index involving over 400
companies revealed that superior humanresource practices explained up to 30%increase in shareholder value.
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Contd..
Hewitt Associates joint study with MichaelTracey led to their publishing the book entitled
Double Digit Growth which again documentshow carefully crafted HR practices can
contribute to the double digit growth of thecorporations. Stanford Professor Jeffrey Peiffers work
published in his seminal book titledCompetitive Advantage through People is yetanother testimony that HR practices cancontribute to the top and bottom line ofcorporations which can be measured andmonitored.
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CHALLENGES OF HRM
ENVIRONMENTAL CHALLENGES Rapid Change Internet Revolution
Workforce Diversity Globalization Legislation Evolving Work and Family Roles
Skill shortages and the rise in theKnowledge Sector Changing Demographics of Employees
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Challenges of HRM-Contd
ORGANIZATIONAL CHALLENGES Competitive Position- Cost, Quality,
or Distinctive Capabilities Decentralization Downsizing Organizational Restructuring Self-Managed Work Teams Organizational Culture
Technology Outsourcing Data Security Changing Attitude towards Unions
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Challenges of HRM-Contd
INDIVIDUAL CHALLENGES
Matching people and organizations
Ethics and Social Responsibility
Productivity
Empowerment
Brain Drain
Job Insecurity
Changing Employee Expectations
Work Life Balance
EFFECTIVENESS OF HRM
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EFFECTIVENESS OF HRMOUTCOMES- Four Cs Model-Researchers at HBS
Commitment
Competence
Congruence
Cost-Effectiveness
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HRM POLICIES A policy is a plan of action. It is a statement of
intention committing the management to ageneral course of action.
HR policies provides guidelines for a widevariety of employment relationships in theorganization. These guidelines identify theorganizations intentions in recruitment,selection, promotion, development,
compensation, organization, motivation andotherwise leading and directing people in theworking organization. They serve as road mapfor employees and management.
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AIMS OF HRM POLICIES
To enable an organization to fulfill or carryout the main objectives of generalemployment policy.
To ensure employees are informed of thesepolicies and secure their co-operation intheir attainment.
To provide such conditions of employmentand procedures as will enable all theemployees to develop a sincere sense ofunity with the enterprise and to carry outtheir duties in the most willing and effectivemanner.
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Contd..
To provide an adequate, competent and trainedemployees for all levels.
To protect the common interests of all the parties andwork in synergy.
To encourage consultative participation of employees. To create mutual faith among the employees andmanagement through leadership.
To ensure training and development of employees. To ensure organizational justice both procedural and
distributive.
To harness employee commitment (organizationalcommitment as well as job commitment) andinvolvement.
To keep the work force motivated through variousefforts.
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OBJECTIVES OF HRM POLICIES
General Objectives- Expresses thetop managements basic philosophyof Human Resources.
Specific Objectives- Refers to thevarious activities of HR like staffing,training, development, salary
administration, motivation, employeeservices and benefits, employeerecords, labour relations, HR researchetc.,
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NEED FOR HR POLICY
The management is required to examine itsbasic convictions in the wake of policies ofother organizations.
Healthy HR policies help in creating a brandimage of the business enterprise in the eyes ofits stakeholders and benchmark it.
Can help an organization become an employerof choice.
Established policies ensure consistenttreatment of all employees.
Favouritism and discrimination can beeliminated or minimized.
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Contd
Promotes organizational stability. Act as control guides for delegated
decision-making.
Encourages definite individual decisions. Policies serve as standards or measuring
yards for evaluating employeeperformance.
Healthy policies promotes employeeengagement, commitment, loyalty andinvolvement.
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PRINCIPLES OF HR POLICIES
Principle of individual development Principle of scientific selection Principle of free flow of communication
Principle of participation Principle of fair remuneration Principle of dignity of labour Principle of labour-management co-
operation Principle of team spirit Principle of contribution to national
prosperity
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ESSENTIAL CHARACTERISTICS OFA HEALTHY HR POLICY
The policies should be definite,positive, clear and simple tocomprehend.
Policies should be stable, but notrigid.
Policies should be in written form.
Policies should be in sync with theobjectives, philosophies and valuesthat the organization wants to build.
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Contd.
Consider the interest of all itsstakeholders.
Policies should encourage a two-way
communication process. It should be progressive and consistent
with professional practice andphilosophy.
It must make a measurable impactwhich can be evaluated.
It has to be uniform in perspective.
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WHY SHOULD HR POLICIES BE INWRITING?
Writing policies makes a commitmenton the part of an organization toadhere to it.
It ensures uniformity of application.
Minimizes favoritism anddiscrimination.
Earns the loyalty and enthusiasm ofemployees as they are assured oforganizational fair play and justice.
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Contd.
It brings accountability on part of themanagement as well the employees.
Writing helps to improve thecorporate brand image.
Provides something concrete onwhich to base an appeal in case of a
dispute or conflict.
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HR POLICY-TYPES/CATEGORIES
General Policies
Equal Opportunity & EmploymentPractices
Compensation
Benefits Management
Management Development andTraining
Disclosure
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General Policies
Equal treatment specifically prohibitdiscrimination on the basis of race,sex, colour, national origin, religion,age, political affiliations, veteranstatus, disability etc..
Alcohol and other drugs- Not allowed
to drink or take other drugs whileworking
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Equal Opportunity & EmploymentPractices
Hiring
Workplace harassment
Types of employment and workinghours
Retention of employees
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Compensation
Pay norms
Absence
Variable and base pay
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Benefits Management
Perks
Medical Claims
Profit Sharing
Holiday Packages etc.,
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Management Development &Training
Training to develop new skills & adaptnew technology
Educational Programme
Career DevelopmentP
rogramme
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Disclosure
Data Security
Maintain each employee personalrecord
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HUMAN RESOURCE PLANNING
HRP is the process by which anorganization ensures that it has theright number and kinds of people, atthe right time, capable of effectivelyand efficiently completing those tasksthat will help the organization achieve
its overall objectives.
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IMPORTANCE OF HRP
Future personnel needs
Part of Strategic planning
Creating highly talented personnel
International Strategies
Foundation ofPersonnel functions
Increasing investments in human resources
Resistance to change and move Other benefits
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Factors affecting HRP
HRP
Org. growthcycle andplanning
Types andStrategy
of org.
Timehorizons
Type and qualityof forecastinginformation
Nature of
jobsbeing filled
outsourcing
EnvironmentalUncertainties
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Steps involved in HRP process
Mission formulating
Establishing Corporate Goals andObjectives
Assessing current human resources
Estimating supplies and demand forlabour
Matching demand with current -supplies of labour-Results inrightsizing and outsourcing decisions
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Human Resource Inventory
HRIS- A computerized system thatassists in the processing of HRMinformation.
Succession Planning- Replacementchart- Individual managers skillsinventory
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Special case in HRP: Retrenchment
Outplacement
Layoffs
Leaves of Absence without pay
Loaning
Work sharing
Reduced work hours
Early Retirement Attrition
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JOB ANALYSIS
It is a systematic exploration of theactivities within a job. It is a technicalprocedure used to define a jobs duties,
responsibilities and accountabilities.
This analysis involves the identificationand description of what is happening onthe job, the knowledge and skillsnecessary for performing them and theconditions under which they must beperformed.
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Job Analysis Methods
Observation Method
Individual Interview Method
Group Interview Method Structured Questionnaire Method
Technical Conference Method
Diary Method Position Analysis Questionnaire
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Purpose of Job Analysis
Job Description- States what the jobholder does
Job Specification- States minimumacceptable qualifications that theincumbent must possess to perform
job successfully
Job Evaluation-Specifies the relativevalue of each job in the organization
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The job analysis informationhierarchy
Element
Task
Duty
Position
Job
Job Family
Occupation Career
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Contd
Position Analysis Questionnaire- Developed byresearchers at Purdue University- Involves 194elements within 27 division job dimensions and fiveoverall job dimensions.
Dimensions-1) Having decision-making/communication/social
responsibilities
2) Performing skilled activities
3) Being physically active/related environmental
conditions.4) Operating vehicles/equipment.
5) Processing information.
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Contd..
CATEGORY
1. Information Input
2. Mental Processes
3. Work output
4. Relationships withother persons
5. Job context6. Other job
characteristics
NO. OF JOB ELEMENTS
35
14
49
36
1941