Human Resource Management Course Code: BBAHR 30501 Credit Units: 03

Course Contents:

Module I: Fundamentals of HRM

Human resources management (HRM) is a management function concerned with hiring, motivating and
maintaining people in an organization. It focuses on people in organizations. Human resource management
is designing management systems to ensure that human talent is used effectively and efficiently to
accomplish organizational goals.

HRM is the personnel function which is concerned with procurement, development, compensation,
integration and maintenance of the personnel of an organization for the purpose of contributing towards the
accomplishments of the organization’s objectives. Therefore, personnel management is the planning,
organizing, directing, and controlling of the performance of those operative functions

Nature of HRM

HRM is a management function that helps manager’s to recruit, select, train and develop members for an
organization. HRM is concerned with people’s dimension in organizations.

The following constitute the core of HRM

1. HRM Involves the Application of Management Functions and Principles. The functions and principles
are applied to acquiring, developing, maintaining and providing remuneration to employees in
organization.
2. Decision Relating to Employees must be integrated. Decisions on different aspects of employees
must be consistent with other human resource (HR) decisions.
3. Decisions Made Influence the Effectiveness of an Organization. Effectiveness of an organization will
result in betterment of services to customers in the form of high quality products supplied at
reasonable costs.
4. HRM Functions are not confined to Business Establishments only but applicable to non business
organizations such as education, health care, recreation and like.

HRM refers to a set of programmes, functions and activities designed and carried out in order to maximize
both employee as well as organizational effectiveness.

Scope of HRM

The scope of HRM is indeed vast. All major activities in the worki ng life of a worker – from the time of his or
her entry into an organization until he or she leaves the organizations comes under the purview of HRM. The
major HRM activities include HR planning, job analysis, job design, employee hiring, employee and executive
remuneration, employee motivation, employee maintenance, industrial relations and prospects of HRM.

The scope of Human Resources Management extends to:

 All the decisions, strategies, factors, principles, operations, practices, functions, activities and
methods related to the management of people as employees in any type of organization.
 All the dimensions related to people in their employment relationships, and all the dynamics that
flow from it.
Objectives of HRM

The primary objective of HRM is to ensure the availability of competent and willing workforce to an
organization. The HRM objectives can be summarized under four specific objectives: societal, organizational,
functional and personnel:

1. Societal Objectives: seek to ensure that the organization becomes socially responsible to the needs
and challenges of the society while minimizing the negative impact of such demands upon the
organization. The failure of the organizations to use their resources for the society’s benefit in
ethical ways may lead to restriction.
2. Organizational Objectives: it recognizes the role of HRM in bringing about organizational
effectiveness. It makes sure that HRM is not a standalone department, but rather a means to assist
the organization with its primary objectives. The HR department exists to serve the rest of the
organization.
3. Functional Objectives: is to maintain the department’s contribution at a level appropriate to the
organization’s needs. Human resources are to be adjusted to suit the organization’s demands. The
department’s value should not become too expensive at the cost of the organization it serves.
4. Personnel Objectives: it is to assist employees in achieving their personal goals, at least as far as
these goals enhance the individual’s contribution to the organization. Personal objectives of
employees must be met if they are to be maintained, retained and motivated. Otherwise employee
performance and satisfaction may decline giving rise to employee turnover

Functions:

The definition of HRM is based on what managers do. The functions performed by managers are common to
all organizations. For the convenience of study, the function performed by the resource management can
broadly be classified into two categories, viz.

(1) Managerial functions, and

(2) Operative functions

Managerial Functions:

Planning:

Planning is a predetermined course of actions. It is a process of determining the organisational goals

and formulation of policies and programmes for achieving them. Thus planning is future oriented
concerned with clearly charting out the desired direction of business activities in future. Forecasting
is one of the important elements in the planning process. Other functions of managers depend on
planning function.

Organising:

Organising is a process by which the structure and allocation of jobs are determined. Thus organising
involves giving each subordinate a specific task establishing departments, delegating authority to
subordinates, establishing channels of authority and communication, coordinating the work of
subordinates, and so on.

Staffing:

It is a process by which managers select, train, promote and retire their subordinates. This involves
deciding what type of people should be hired, recruiting prospective employees, selecting
 employees, setting performance standard, compensating employees, evaluating performance,
counseling employees, training and developing employees.

Directing/Leading:

Directing is the process of activating group efforts to achieve the desired goals. It includes activities
like getting subordinates to get the job done, maintaining morale motivating subordinates etc. for
achieving the goals of the organisation.

Controlling:

It is the process of setting standards for performance, checking to see how actual performance
compares with these set standards, and taking corrective actions as needed.

Operative Functions:

The operative, also called, service functions are those which are relevant to specific department. These
functions vary from department to department depending on the nature of the department Viewed from
this standpoint, the operative functions of HRM relate to ensuring right people for right jobs at right times.
These functions include procurement, development, compensation, and maintenance functions of HRM.

Procurement:

It involves procuring the right kind of people in appropriate number to be placed in the organisation.
It consists of activities such as manpower planning, recruitment, selection placement and induction
or orientation of new employees.

Development:

This function involves activities meant to improve the knowledge, skills aptitudes and values of
employees so as to enable them to perform their jobs in a better manner in future. These functions
may comprise training to employees, executive training to develop managers, organisation
development to strike a better fit between organisational climate/culture and employees.

Compensation:

Compensation function involves determination of wages and salaries matching with contribution
made by employees to organisational goals. In other words, this function ensures equitable and fair
remuneration for employees in the organisation. It consists of activities such as job evaluation, wage
and salary administration, bonus, incentives, etc.

Maintenance:

It is concerned with protecting and promoting employees while at work. For this purpose virus
benefits such as housing, medical, educational, transport facilities, etc. are provided to the
employees. Several social security measures such as provident fund, pension, gratuity, group
insurance, etc. are also arranged.

It is important to note that the managerial and operative functions of HRM are performed in conjunction
with each other in an organisation, be large or small organisations.
Role of Human Resource Manager

The role of HRM is to plan, develop and administer policies and programs designed to make optimum use of
an organizations human resources. It is that part of management which is concerned with the people at
work and with their relationship within enterprises. Its objectives are: (a) effective utilization of human
resources, (b) desirable working relationships among all members of the organizations, and (c) maximum
individual development. Human resources function as primarily administrative and professional. HR staff
focused on administering benefits and other payroll and operational functions and didn’t think of
themselves as playing a part in the firm’s overall strategy.

The primary responsibilities of Human Resource managers are:

 To develop a thorough knowledge of corporate culture, plans and policies.

 To act as an internal change agent and consultant
 To initiate change and act as an expert and facilitator
 To actively involve in company’s strategy formulation
 To keep communication line open between the HRD function and individuals and groups both within
and outside the organization
 To identify and evolve HRD strategies in consonance with overall business strategy.
 To facilitate the development of various organizational teams and their working relationship with
other teams and individuals.
 To try and relate people and work so that the organization objectives are achieved efficiently and
effectively.
 To diagnose problems and determine appropriate solution particularly in the human resource areas.
 To provide co-ordination and support services for the delivery of HRD programmes and services
 To evaluate the impact of an HRD intervention or to conduct research so as to identify, develop or
test how HRD In general has improved individual and organizational performance.

Classification of HR roles

According to R.L Mathis and J. H. Jackson (2010) several roles can be fulfilled by HR management. The nature
and extent of these roles depend on both what upper management wants HR management to do and what
competencies the HR staff have demonstrated. Three roles are typically identified for HR

Administrative Role of HR

The administrative role of HR management has been heavily oriented to administration and
recordkeeping including essential legal paperwork and policy implementation. Major changes have
happened in the administrative role of HR during the recent years. Two major shifts driving the
transformation of the administrative role are: Greater use of technology and Outsourcing.

Operational and Employee Advocate Role for HR

HR managers manage most HR activities in line with the strategies and operations that have been
identified by management and serves as employee “champion” for employee issues and concerns.
HR often has been viewed as the “employee advocate” in organizations. They act as the voice for
employee concerns, and spend considerable time on HR “crisis management,” dealing with
employee problems that are both work-related and not work-related.

The operational role requires HR professionals to cooperate with various departmental and
operating managers and supervisors in order to identify and implement needed programs and
policies in the organization
Strategic Role for HR

The strategic HR role means that HR professionals are proactive in addressing business realities and
focusing on future business needs, such as strategic planning, compensation strategies, the
performance of HR, and measuring its results. However, in some organizations, HR often does not
play a key role in formulating the strategies for the organization as a whole; instead it merely carries
them out through HR activities

HRM in the New Millennium

Human Resources have never been more indispensable than today. The competitive forces that we face
today will continue to face in the future demanding organizational excellence. In order to achieve this
extended quality, organization’s need to focus on learning, quality development, teamwork, and
reengineering. These factors are driven by the way organizations implement things and how employees are
treated.

1. HR Can Help in Dispensing Organizational Excellence: To achieve this paradigm shift in the organization
excellence there is a need for organizations to reform the way in which work is carried out by the Human
Resource department. By designing an entirely new role and agenda that results in enriching the
organization’s value to customers, investors and employees, HR can help in delivering organizational
excellence. This can be carried out by helping line managers and senior mangers in moving planning from the
conference room to the market place and by becoming an expert in the way work is organized and executed.

2. Human Resource Should be a Strategy Partner: HR should also become a partner in strategy executions by
propelling and directing serious discussions of how the company should be organized to carry out its
strategy.

Creating the conditions for this discussion involves four steps. First HR need to define an organizational
architecture by identifying the company’s way of doing business. Second, HR must be held responsible for
conducting an organizational audit. Third, HR as a strategic partner needs to identify methods for restoring
the parts of the organizational architecture that need it. Fourth and finally, HR must take stock of its own
work and set clear priorities. In their new role as administrative experts they will need to shed their
traditional image and still make sure all routine work for the company is done well.

3. HR Accountability Should be Fixed to Ensure Employee Commitment: HR must be held accountable for
ensuring that employees feel committed to the organization and contribute fully. They must take
responsibility for orienting and training line management about the importance of high employee morale
and how to achieve it. The new HR should be the voice of employees in management discussions. The new
role for HR might also involve suggesting that more teams be used on some projects or that employees be
given more control over their own work schedules.

4. The New HR Must Become a Change Agent: The new HR must become a change agent, which is building
the organization’s capacity to embrace and capitalize on change. Even though they are not primarily
responsible for executing change it is the duty of the HR manager to make sure that the organization carries
out the changes framed for implementation.

5. Improving the Quality of HR: The most important thing that managers can do to drive the ne mandate for
HR is to improve the quality of the HR staff itself. Senior executives must get beyond the stereotypes of HR
professionals as incompetent support staff and unleash HR’s full potential
6. Change in Employment Practices: The balance sheet of an organization shows human resource as an
expense and not as a Capital. In the information age, it is perceived that the machines can do the work more
efficiently than most people however; technology to work is dependent on people

Module II: Acquisition of Human Resources

Human resource is the most important asset of an organisation. Human resources planni ng are the
important managerial function. It ensures the right type of people, in the right number, at the right time and
place, who are trained and motivated to do the right kind of work at the right time, there is generally a
shortage of suitable persons. According to E.W. Vetter, human resource planning is “the process by which a
management determines how an organisation should make from its current manpower position to its desired
manpower position.”

Objectives:

The main objective of having human resource planning is to have an accurate number of employ-ees
required, with matching skill requirements to accomplish organisational goals.

In other words, the objectives of human resource planning are to:

1. Ensure adequate supply of manpower as and when required.

2. Ensure proper use of existing human resources in the organisation.
3. Forecast future requirements of human resources with different levels of skills.
4. Assess surplus or shortage, if any, of human resources available over a specified period of time.
5. Anticipate the impact of technology on jobs and requirements for human resources.
6. Control the human resources already deployed in the organisation.
7. Provide lead time available to select and train the required additional human resource over a
specified time period.

Need for and Importance of HRP:

The need for human resource planning in organisation is realised for the following reasons:

1. Despite growing unemployment, there has been shortage of human resources with required skills,
qualification and capabilities to carry on works. Hence the need for human resource planning.
2. Large numbers of employees, who retire, die, leave organisations, or become incapacitated because
of physical or mental ailments, need to be replaced by the new employees. Human resource
planning ensures smooth supply of workers without interruption.
3. Human resource planning is also essential in the face of marked rise in workforce turnover which is
unavoidable and even beneficial. Voluntary quits, discharges, marriages, promo-tions and seasonal
fluctuations in business are the examples of factors leading to workforce turnover in organisations.
These cause constant ebb and flow in the work force in many organisations.
4. Technological changes and globalisation usher in change in the method of products and distribution
of production and services and in management techniques. These changes may also require a
change in the skills of employees, as well as change in the number of employ-ees required. It is
human resource planning that enables organisations to cope with such changes.
5. Human resource planning is also needed in order to meet the needs of expansion and
diver-sification programmes of an organisation.
6. The need for human resource planning is also felt in order to identify areas of surplus personnel or
areas in which there is shortage of personnel. Then, in case of surplus personnel, it can be
redeployed in other areas of organisation. Conversely, in case of shortage of personnel, it can be
made good by downsizing the work force.
Human resource planning is important to organisation because it benefits the organisation in several ways.

The important ones are mentioned below:

1. Human resource planning meets the organisation need for right type of people in right number at
right times.
2. By maintaining a balance between demand for and supply of human resources, human resource
planning makes optimum use of human resources, on the one hand, and reduces labour cost
substantially, on the other.
3. Careful consideration of likely future events, through human resource planning might lead to the
discovery of better means for managing human resources. Thus, foreseeable pitfalls might be
avoided.
4. Manpower shortfalls and surpluses may be avoided, to a large extent.
5. Human resource planning helps the organisation create and develop training and succes-sion
planning for employees and managers. Thus, it provides enough lead time for internal succession of
employees to higher positions through promotions.
6. It also provides multiple gains to the employees by way of promotions, increase in emolu-ments and
other perquisites and fringe benefits.
7. Some of the problems of managing change may be foreseen and their consequences miti-gated.
Consultations with affected groups and individuals can take place at an early stage in the change
process. This may avoid resistance for change.
8. Human resource planning compels management to asses critically the strength and weak-nesses of
its employees and personnel policies on continuous basis and, in turn, take corrective measures to
improve the situation.
9. Through human resource planning, duplication of efforts and conflict among efforts can be avoided,
on the one hand, and coordination of worker’s efforts can be improved, on the other.
10. Last but no means the least, with increase in skill, knowledge, potentialities, productivity and job
satisfaction, organisation becomes the main beneficiary. Organisation is benefitted in terms of
increase in prosperity/production, growth, development, profit and, thus, an edge over its
competitors in the market.

Job Analysis

Job analysis is the process of studying and collecting information relating to the operations and
responsibilities of a specific job. The immediate products of this analysis are job descriptions and job
specifications. Job analysis is a systematic exploration of the activities within a job. It is a basic technical
procedure, one that is used to define the duties, responsibilities and accountabilities of a job.

Specifically, job analysis involves the following steps:

1. Collecting and recording job information

2. Checking the job information for accuracy.
3. Writing job description based on the information
4. Using the information to determine the skills, abilities and knowledge that are required on the job.
5. Updating the information from time to time.
Job Description is an important document, which is basically descriptive in nature and contains a statement
of job Analysis. It provides both organizational information’s (like location in structure, authority etc) and
functional information (what the work is).

It gives information about the scope of job activities, major responsibilities and positioning of the job in the
organization. This information gives the worker, analyst, and supervisor with a clear idea of what the worker
must do to meet the demand of the job.

There are several uses of job description, like

• Preliminary drafts can be used as a basis for productive group discussion, particularly if the process
starts at the executive level.
• It helps in the development of job specification.
• It acts as a tool during the orientation of new employees, to learn duties & responsibilities. It can act
as a basic document used in developing performance standards.

Job Specification translates the job description into terms of the human qualifications, which are required
for performance of a job. They are intended to serve as a guide in hiring and job evaluation

Job specification is a written statement of qualifications, traits, physical and mental characteristics that an
individual must possess to perform the job duties and discharge responsibilities effectively.

Job Specification Information: –

The first step in the programme of job specification is to prepare a list of all jobs in the company and where
they are located. The second step is to secure and write up information about each of the jobs in a company.
Usually this information includes:

1. Physical specifications: – Physical specifications include the physical qualifications or physical

capacities that vary from job to job. Physical qualifications or capacities
Include physical features like height, weight, chest, vision, hearing, ability to lift weight, ability to
carry weight, health, age, capacity to use or operate machines, tools, equipment etc.
2. Mental specifications: – Mental specifications include ability to perform, arithmetical calculations, to
interpret data, information blue prints, to read electrical circuits, ability to plan, reading abilities,
scientific abilities, judgment, ability to concentrate, ability to handle variable factors, general
intelligence, memory etc.
3. Emotional and social specifications: – Emotional and social specifications are more important for the
post of managers, supervisors, foremen etc. These include emotional stability, flexibility, social
adaptability in human relationships, personal appearance including dress, posture etc.
4. Behavioral Specifications: – Behavioral specifications play an important role in selecting the
candidates for higher-level jobs in the organizational hierarchy. This specification seeks to describe
the acts of managers rather than the traits that cause the acts. These specifications include
judgments, research, creativity, teaching ability, maturity trial of conciliation, self-reliance,
dominance etc.

Recruitment

Recruitment is the process of finding and attracting capable applicants for employment. The Process begins
when new recruits are sought and ends when their applications are submitted. The result is a pool of
application from which new employees are selected.

Recruitment process involves a systematic procedure from sourcing the candidates to arranging and
conducting the interviews and requires many resources and time.
There are a number of stages, which can be used to define and set out the nature of particular jobs for
recruitment purposes;

1. Identifying the vacancy: The recruitment process begins with the human resource department
receiving requisitions for recruitment from any department of the company. These contain:
a. Posts to be filled
b. Number of persons
c. Duties to be performed
d. Qualifications required
2. Preparing the job description and person specification.
3. Advertising the Vacancy - locating and developing the sources of required number and type of
employees.
4. Short-listing and identifying the prospective employee with required characteristics.
5. Arranging the interviews with the selected candidates.
6. Conducting the interview and decision making

Internal and External Sources of Recruitment

Recruiting individuals to fill particular posts within a business can be done either internally by recruitment
within the firm, or externally by recruiting people from outside.

Internal Sources of Recruitment

1. TRANSFERS: The employees are transferred from one department to another according to their
efficiency and experience.
2. PROMOTIONS: The employees are promoted from one department to another with more benefits
and greater responsibility based on efficiency and experience.
3. Others are Upgrading and Demotion of present employees according to their performance.
4. Retired and Retrenched employees may also be recruited once again in case of shortage of qualified
personnel or increase in load of work. Recruitment such people save time and costs of the
organisations as the people are already aware of the organizational culture and the policies and
procedures.
5. The dependents and relatives of Deceased employees and Disabled employees are also done by
many companies so that the members of the family do not become dependent on the mercy of
others.

The advantages of internal recruitment are that:

1. Considerable savings can be made. Individuals with inside knowledge of how a business operates will
need shorter periods of training and time for 'fitting in'.
2. The organisation is unlikely to be greatly 'disrupted' by someone who is used to working with others
in the organisation.
3. Internal promotion acts as an incentive to all staff to work harder within the organisation.
4. From the firm's point of view, the strengths and weaknesses of an insider will have been assessed.
There is always a risk attached to employing an outsider who may only be a success 'on paper'

The disadvantages of recruiting from within are that:

• You will have to replace the person who has been promoted.
• An insider may be less likely to make the essential criticisms required to get the company working
more effectively.
• Promotion of one person in a company may upset someone else.
External Sources of Recruitment

1. PRESS ADVERTISEMENTS: Advertisements of the vacancy in newspapers and journals are a widely
used source of recruitment. The main advantage of this method is that it has a wide reach.
2. EDUCATIONAL INSTITUTES: Various management institutes, engineering colleges, medical Colleges
etc. are a good source of recruiting well qualified executives, engineers, medical staff etc. They
provide facilities for campus interviews and placements. This source is known as Campus
Recruitment.
3. PLACEMENT AGENCIES: Several private consultancy firms perform recruitment functions on behalf
of client companies by charging a fee. These agencies are particularly suitable for recruitment of
executives and specialists. It is also known as RPO (Recruitment Process Outsourcing)
4. EMPLOYMENT EXCHANGES: Government establishes public employment exchanges throughout the
country. These exchanges provide job information to job seekers and help e mployers in identifying
suitable candidates.
5. LABOUR CONTRACTORS: Manual workers can be recruited through contractors who maintain close
contacts with the sources of such workers. This source is used to recruit labour for construction jobs.
6. UNSOLICITED APPLICANTS: Many job seekers visit the office of well-known companies on their own.
Such callers are considered nuisance to the daily work routine of the enterprise. But can help in
creating the talent pool or the database of the probable candidates for the organisation
7. EMPLOYEE REFERRALS / RECOMMENDATIONS: Many organisations have structured system where
the current employees of the organization can refer their friends and relatives for some position in
their organisation. Also, the office bearers of trade unions are often aware of the suitability of
candidates. Management can inquire these leaders for suitable jobs. In some organizations these are
formal agreements to give priority in recruitment to the candidates recommended by the trade
union.
8. RECRUITMENT AT FACTORY GATE: Unskilled workers may be recruited at the factory gate and these
persons may be employed whenever a permanent worker is absent. More efficient among these
may be recruited to fill permanent vacancies.

Advantages of External recruitment

• External recruitment makes it possible to draw upon a wider range of talent, and
• provides the opportunity to bring new experience and ideas in to the business.

Disadvantages of External recruitment

• It is more costly and the company may end up with someone who proves to be less effective in
practice than they did on paper and in the interview situation.

Selection is the process of picking up individuals (out of the pool of job applicants) with requisite
qualifications and competence to fill jobs in the organization. A formal definition of Selection is as under

“Selection is the process of differentiating between applicants in order to identify and

hire those with a greater likelihood of success in a job.”

PROCESS / STEPS IN SELECTION

1. Preliminary Interview: The purpose of preliminary interviews is basically to eliminate unqualified

applications based on information supplied in application forms. The basic objective is to reject
misfits. On the other hands preliminary interviews is often called a courtesy interview and is a good
public relations exercise.
 2. Selection Tests: Jobseekers who past the preliminary interviews are called for tests. There are
various types of tests conducted depending upon the jobs and the company. These tests can be
Aptitude Tests, Personality Tests, and Ability Tests and are conducted to judge how well an
individual can perform tasks related to the job. Besides this there are some other tests also like
Interest Tests (activity preferences), Graphology Test (Handwriting), Medical Tests, Psychometric
Tests etc.
3. Employment Interview: The next step in selection is employment interview. Here interview is a
formal and in-depth conversation between applicant’s acceptability. It is considered to be an
excellent selection device. Interviews can be One-to-One, Panel Interview, or Sequential Interviews.
Besides there can be Structured and Unstructured interviews, Behavioral Interviews, Stress
Interviews.
4. Reference & Background Checks: Reference checks and background checks are conducted to verify
the information provided by the candidates. Reference checks can be through formal letters,
telephone conversations. However it is merely a formality and selections decisions are seldom
affected by it.
5. Selection Decision: After obtaining all the information, the most critical step is the selection decision
is to be made. The final decision has to be made out of applicants who have passed preliminary
interviews, tests, final interviews and reference checks. The views of line managers are considered
generally because it is the line manager who is responsible for the performance of the new
employee.
6. Physical Examination: After the selection decision is made, the candidate is required to undergo a
physical fitness test. A job offer is often contingent upon the candidate passing the physical
examination.
7. Job Offer: The next step in selection process is job offer to those applicants who have crossed all the
previous hurdles. It is made by way of letter of appointment.
8. Final Selection

Difference between Recruitment and Selection:

Recruitment Selection
1. Recruitment refers to the process of identifying 1. Selection is concerned with picking up the right
and encouraging prospective employees to apply for candidates from a pool of applicants.
jobs.
2. Recruitment is said to be positive in its approach 2. Selection on the other hand is negative in its
as it seeks to attract as many candidates as possible. application in as much as it seeks to eliminate as
many unqualified applicants as possible in order to
identify the right candidates.

The Induction duly helps employees to undergo each and every phase of environment of Company and an
introduction to his team and others. It gives them the platform of knowing and understanding the culture
and knowing “ Who is who” .It is such a phase which gives a glimpse of entire Organization in that short
span.

Placement is said to be the process of fitting the selected person at the right job or place, i.e. fitting square
pegs in square holes and round pegs in round holes. Once he is fitted into the job, he is given the activities
he has to perform and also told about his duties. The freshly appointed candidates are then given
orientation in order to familiarize and introduce the company to him.
Module III: Development of Human Resources

TRAINING AND DEVELOPMENT is a subsystem of an organization and core function of human resource
management. It ensures continuous skill development of employees working in organisation and habituates
process of learning for developing knowledge to work. Training and Development is the foundation for
obtaining quality output from employees.

Training and Development is a structured program with different methods will be designed by professionals
in particular job. It has become most common and continuous task in any organisation for updating skills and
knowledge of employees in accordance with changing environment. Optimisation of cost with available
resources has become pressing need for every organisation which will be possible only by way of improving
efficiency and productivity of employees, possible only by way of providing proper employee training and
development conditioned to that it should be provided by professionals.

Purpose of Employee Training and Development Process

Reasons for emphasizing the growth and development of personnel include

• Creating a pool of readily available and adequate replacements for personnel who may leave or
move up in the organization.
• Enhancing the company's ability to adopt and use advances in technology because of a sufficiently
knowledgeable staff.
• Building a more efficient, effective and highly motivated team, which enhances the company's
competitive position and improves employee morale.
• Ensuring adequate human resources for expansion into new programs.

The Training Process

The model below traces the steps necessary in the training process:

• Organizational Objectives
• Needs Assessment
• Is There a Gap?
• Training Objectives
• Select the Trainees
• Select the Training Methods and Mode
• Choose a Means of Evaluating
• Administer Training
• Evaluate the Training

Training Methods

There are two broad types of training available to small businesses: on-the-job and off-the-job techniques.
Individual circumstances and the "who," "what" and "why" of your training program determine which
method to use.

On-the-job training is delivered to employees while they perform their regular jobs. In this way, they do not
lose time while they are learning. After a plan is developed for what should be taught, employees should be
informed of the details. A timetable should be established with periodic evaluations to inform employees
about their progress. On-the-job techniques include orientations, job instruction training, apprenticeships,
internships and assistantships, job rotation and coaching.
Off-the-job techniques include lectures, special study, films, television conferences or discussions, case
studies, role playing, simulation, programmed instruction and laboratory training. Most of these techniques
can be used by small businesses although, some may be too costly.

Orientations are for new employees. The first several days on the job are crucial in the success of new
employees. This point is illustrated by the fact that 60 percent of all employees who quit do so in the first ten
days. Orientation training should emphasize the following topics:

• The company's history and mission.

• The key members in the organization.
• The key members in the department, and how the department helps fulfill the mission of the
company.
• Personnel rules and regulations.

Kirkpatrick's Four-Level Training Evaluation Model helps objectively analyze the effectiveness and impact of
training programme, so that it can be improved it in the future.

The Kirkpatrick Model

• Level 1: Reaction - To what degree participants react favorably to the training

• Level 2: Learning - To what degree participants acquire the intended knowledge, skills, attitudes,
confidence and commitment based on their participation in a training event
• Level 3: Behavior - To what degree participants apply what they learned during training when they
are back on the job
• Level 4: Results - To what degree targeted outcomes occur as a result of the training event and
subsequent reinforcement

Performance Appraisals

It is a systematic evaluation of an individual with respect to performance on the job and individual’s
potential for development. It is a developmental tool used for all round development of the employee and
the organization.

Performance Appraisal Process Use of Performance Appraisals

1. Objectives definition of appraisal 1. Promotions

2. Job expectations establishment 2. Confirmations
3. Design an appraisal program 3. Training and Development
4. Appraise the performance 4. Compensation reviews
5. Performance Interviews 5. Competency building
6. Use data for appropriate purposes 6. Improve communication
7. Identify opportunities variables 7. Evaluation of HR Programs
8. Using social processes, physical processes, 8. Feedback & Grievances
human and computer assistance

TECHNIQUES / METHODS OF PERFORMANCE APPRAISALS

Numerous methods have been devised to measure the quantity and quality of performance appraisals. Each
of the methods is effective for some purposes for some organizations only. None should be dismissed or
accepted as appropriate except as they relate to the particular needs of the organization or an employee.

Broadly all methods of appraisals can be divided into two different categories.
Past Oriented Methods

1. Rating Scales: Rating scales consists of several numerical scales representing job related performance
criterions such as dependability, initiative, output, attendance, attitude etc. Each scales ranges from
excellent to poor. The total numerical scores are computed and final conclusions are derived. Advantages –
Adaptability, easy to use, low cost, every type of job can be evaluated, large number of employees covered,
no formal training required. Disadvantages – Rater’s biases

2. Checklist: Under this method, checklist of statements of traits of employee in the form of Yes or No based
questions is prepared. Here the rater only does the reporting or checking and HR department does the
actual evaluation. Advantages – economy, ease of administration, limited training required, standardization.
Disadvantages – Raters biases, use of improper weighs by HR, does not allow rater to give relative ratings

3. Forced Choice Method: The series of statements arranged in the blocks of two or more are given and the
rater indicates which statement is true or false. The rater is forced to make a choice. HR department does
actual assessment. Advantages – Absence of personal biases because of forced choice. Disadvantages –
Statements may be wrongly framed.

4. Forced Distribution Method: here employees are clustered around a high point on a rating scale. Rater is
compelled to distribute the employees on all points on the scale. It is assumed that the performance is
conformed to normal distribution. Advantages – Eliminates Disadvantages – Assumption of normal
distribution, unrealistic, errors of central tendency.

5. Critical Incidents Method: The approach is focused on certain critical behaviors of employee that makes all
the difference in the performance. Supervisors as and when they occur record such incidents. Advantages –
Evaluations are based on actual job behaviors, ratings are supported by descriptions, feedback is easy,
reduces recency biases, chances of subordinate improvement are high. Disadvantages – Negative incidents
can be prioritized, forgetting incidents, overly close supervision; feedback may be too much and may appear
to be punishment.

6. Behaviorally Anchored Rating Scales: statements of effective and ineffective behaviors determine the
points. They are said to be behaviorally anchored. The rater is supposed to say, which behavior describes the
employee performance. Advantages – helps overcome rating errors. Disadvantages – Suffers from
distortions inherent in most rating techniques.

7. Field Review Method: This is an appraisal done by someone outside employees’ own department usually
from corporate or HR department. Advantages – Useful for managerial level promotions, when comparable
information is needed, Disadvantages – Outsider is generally not familiar with employees work environment,
Observation of actual behaviors not possible.

8. Performance Tests & Observations: This is based on the test of knowledge or skills. The tests may be
written or an actual presentation of skills. Tests must be reliable and validated to be useful. Advantage –
Tests may be apt to measure potential more than actual performance. Disadvantages – Tests may suffer if
costs of test development or administration are high.

9. Confidential Records: Mostly used by government departments, however its application in industry is not
ruled out. Here the report is given in the form of Annual Confidentiality Report (ACR) and may record ratings
with respect to following items; attendance, self expression, team work, leadership, initiative, technical
ability, reasoning ability, originality and resourcefulness etc. The system is highly secretive and confidential.
Feedback to the assessee is given only in case of an adverse entry. Disadvantage is that it is highly subjective
and ratings can be manipulated because the evaluations are linked to HR actions like promotions etc.
10. Essay Method: In this method the rater writes down the employee description in detail within a number
of broad categories like, overall impression of performance, promoteability of employee, existing capabilities
and qualifications of performing jobs, strengths and weaknesses and training needs of the employee.
Advantage – It is extremely useful in filing information gaps about the employees that often occur in a
better-structured checklist. Disadvantages – It its highly dependent upon the writing skills of rater and most
of them are not good writers. They may get confused success depends on the memory power of raters.

11. Cost Accounting Method: Here performance is evaluated from the monetary returns yields to his or her
organization. Cost to keep employee, and benefit the organization derives is ascertained. Hence it is more
dependent upon cost and benefit analysis.

12. Comparative Evaluation Method (Ranking & Paired Comparisons) : These are collection of different
methods that compare performance with that of other co-workers. The usual techniques used may be
ranking methods and paired comparison method.

 Ranking Methods: Superior ranks his worker based on merit, from best to worst. However how best
and why best are not elaborated in this method. It is easy to administer and explanation.
 Paired Comparison Methods: In this method each employee is rated with another employee in the
form of pairs. The number of comparisons may be calculated with the help of a formula as under.

Future Oriented Methods

1. Management By Objectives: It means management by objectives and the performance is rated against the
achievement of objectives stated by the management. MBO process goes as under.

• Establish goals and desired outcomes for each subordinate

• Setting performance standards
• Comparison of actual goals with goals attained by the employee
• Establish new goals and new strategies for goals not achieved in previous year.

 Advantage – It is more useful for managerial positions.

 Disadvantages – Not applicable to all jobs, allocation of merit pay may result in setting short-term
goals rather than important and long-term goals etc.

2. Psychological Appraisals: These appraisals are more directed to assess employees potential for future
performance rather than the past one. It is done in the form of in-depth interviews, psychological tests, and
discussion with supervisors and review of other evaluations. It is more focused on employees emotional,
intellectual, and motivational and other personal characteristics affecting his perf ormance. This approach is
slow and costly and may be useful for bright young members who may have considerable potential.
However quality of these appraisals largely depend upon the skills of psychologi sts who perform the
evaluation.

3. Assessment Centers: An assessment center is a central location where managers may come together to
have their participation in job related exercises evaluated by trained observers. It is more focused on
observation of behaviors across a series of select exercises or work samples. Assessees are requested to
participate in in-basket exercises, work groups, computer simulations, role playing and other similar
activities which require same attributes for successful performance in actual job. The characteristics
assessed in assessment center can be assertiveness, persuasive ability, communicating ability, planning and
organizational ability, self confidence, resistance to stress, energy level, decision making, sensitivity to
feelings, administrative ability, creativity and mental alertness etc.
 • Disadvantages – Costs of employees traveling and lodging, psychologists, ratings strongly influenced
by assessee’s inter-personal skills. Solid performers may feel suffocated in simulated situations.
Those who are not selected for this also may get affected.
• Advantages – well-conducted assessment center can achieve better forecasts of future performance
and progress than other methods of appraisals. Also reliability, content validity and predictive ability
are said to be high in assessment centers. The tests also make sure that the wrong people are not
hired or promoted. Finally it clearly defines the criteria for selection and promotion.

4. 360-Degree Feedback: It is a technique which is systematic collection of performance data on an individual

group, derived from a number of stakeholders like immediate supervisors, team members, customers, peers
and self. In fact anyone who has useful information on how an employee does a job may be one of the
appraisers. This technique is highly useful in terms of broader perspective, greater self-development and
multi-source feedback is useful. 360-degree appraisals are useful to measure inter-personal skills, customer
satisfaction and team building skills. However on the negative side, receiving feedback f rom multiple sources
can be intimidating, threatening etc. Multiple raters may be less adept at providing balanced and objective
feedback.

Module IV: Maintenance of Human Resources

Concept of job evaluation:

In simple words, job evaluation is the rating of jobs in an organisation. This is the process of establishing the
value or worth of jobs in a job hierarchy. It attempts to compare the relative intrinsic value or worth of jobs
within an organisation. Thus, job evaluation is a comparative process.

According to the International Labour Office (ILO) “Job evaluation is an attempt to determine and compare
the demands which the normal performance of a particular job makes on normal workers, without taking
into account the individual abilities or performance of the workers concerned”.

Objectives of job evaluation:

The main objective of job evaluation is to determine relative worth of different jobs in an organisation to
serve as a basis for developing equitable salary structure. The principle upon which all job evaluation
schemes are based is that of describing and assessing the value of all jobs in the firms in terms of a number
of factors, the relative importance of which varies from job to job.

The objectives of job evaluation, to put in a more orderly manner are to:

1. Provide a standard procedure for determining the relative worth of each job in a plant.
2. Determine equitable wage differentials between different jobs in the organisation.
3. Eliminate wage inequalities.
4. Ensure that like wages are paid to all qualified employees for like work.
5. Form a basis for fixing incentives and different bonus plans.
6. Serve as a useful reference for setting individual grievances regarding wage rates.
7. Provide information for work organisation, employees’ selection, placement, training and numerous
other similar problems.
8. Provide a benchmark for making career planning for the employees in the organisation.
Job Evaluation Process

The process of job evaluation involves the following steps:

1. Gaining acceptance: Before undertaking job evaluation, top management must explain the aims) and
uses of the programme to the employees and unions. To elaborate the program further, oral
presentations could be made. Letters, booklets could be used to classify all relevant aspects of the job
evaluation programme.
2. Creating job evaluation committee: It is not possible for a single person to evaluate all the key jobs in an
organization. Usually a job evaluation committee consisting of experienced employees, union
representatives and HR experts is created to set the ball rolling.
3. Finding the jobs to be evaluated: Every job need not be evaluated. This may be too taxing and costly.
Certain key jobs in each department may be identified. While picking up the jobs, care must be taken to
ensure that they represent the type of work performed in that department.
4. Analysing and preparing job description: This requires the preparation of a job description and also an
analysis of job needs for successful performance.
5. Selecting the method of evaluation: The most important method of evaluating the jobs must be
identified now, keeping the job factors as well as organisational demands in mind.
6. Classifying jobs: The relative worth of various jobs in an organisation may be found out after arranging
jobs in order of importance using criteria such as skill requirements, experience needed, under which
conditions job is performed, type of responsibilities to be shouldered, degree of supervision needed, the
amount of stress caused by the job, etc. Weights can be assigned to each such factor. When we finally
add all the weights, the worth of a job is determined. The points may then be converted into monetary
values.

Advantages of job evaluation:

According to an ILO publication job evaluation offers the following advantages:

1. Job evaluation being a logical process and objective technique helps in developing an equi-table and
consistent wage and salary structure based on the relative worth of jobs in an organisation.
2. By eliminating wage differentials within the organisation, job evaluation helps in minimizing conflict
between labour unions and management and, in turn, helps in promoting harmoni-ous relations
between them.
3. Job evaluation simplifies wage administration by establishing uniformity in wage rates.

Drawbacks of job evaluation:

In spite of many advantages, job evaluation suffers from the following drawbacks/limitations:

1. Job evaluation is susceptible because of human error and subjective judgment. While there is no
standard list of factors to be considered for job evaluation, there are some factors that cannot be
measured accurately.
2. There is a variation between wages fixed through job evaluation and market forces. Say Kerr and
Fisher, the jobs which tend to rate high as compared with the market are those of junior, nurse and
typist, while craft rates are relatively low. Weaker groups are better served by an evaluation plan
than by the market, the former places the emphasis not on force but on equity”.
3. When job evaluation is applied for the first time in an organisation, it creates doubts in the minds of
workers whose jobs are evaluated and trade unions that it may do away with collective bargaining
for fixing wage rates.
Module V: Retention and Separation Processes

Discharge

Discharging an employee can also be referred to as firing an employee. Companies fire employees for a wide
range of reasons. Employers may fire specific employees due to a lack of performance after numerous
attempts to help the employee improve his productivity, for example. Employees can be fired after continual
confrontations with management or co-workers, as a way to prevent subversive influences from creating a
hostile work environment. In extreme cases, companies may fire employees on the spot for exhibiting
violent or threatening behavior, or for committing a criminal act such as fraud or theft on the job.

Layoff

A layoff is similar to a discharge, except that layoffs are not performed due to the negative behavior or poor
performance of employees. Companies lay off workers when they cannot afford to pay them anymore due
to financial hardship. Layoffs can also occur when two companies merge, due to human resources
redundancies that need to be right-sized. Companies also lay off employees as a precursor to outsourcing
departments internationally.

Resignation

A resignation occurs when an employee takes the initiative to terminate the employment relationship.
Employees resign for a wide range of reasons. Employees may leave their employers due to the type of
continual confrontation mentioned, or for purely financial reasons. Employees may resign while maintaining
a good relationship with their employer, to pursue other career opportunities, to move their home to a
different area or a host of other possibilities. In rare cases, employees may voluntarily resign after
committing an act that would require the company to discharge them.

Re-hiring

The three ways to end an employment relationship each carry different implications for the possibility of re-
hiring employees. Discharged employees are the least likely to be re -hired, and many companies have
policies in place preventing them from re-hiring any employee who has been fired. Laid-off employees are
the most likely to be offered their jobs back, as long as the jobs actually come back, and some employers
actually lay off employees with the intention of re-hiring them when the company gets back on its feet.

Retrenchment: Forced lay-off of employees by a firm, usually to cut down its payroll.

Voluntary retirement scheme is a method used by companies to reduce surplus staff. This mode has come
about in India as labour laws do not permit direct retrenchment of unionized employees. VRS applies to an
employee who has completed 10 years of service or is above 40 years of age

Promotion

According to Pigours and Myers, ‘Promotion is advancement of an employee to a better job – better in terms
of greater responsibility, more prestige or status, greater skill and especially increased rate of pay or salary”.

Purposes of Promotion:

 To utilize the employee’s skill knowledge at the appropriate level in the organizational hierarchy
 To develop competitive spirit and inculcate the zeal in the employees to acquire the skill, knowledge
etc. required by higher level jobs.
 To develop competent internal source of employees ready to take up jobs at higher levels in the
changing environment.
  To promote employees’ self development and make them await their turn of promotions. It reduces
labour turnover.
 To promote a feeling of contentment with the existing conditions of the company and a sense of
belongingness.
 To promote interest in training, development programmes and in team development areas.
 To build loyalty and to boost morale.
 To reward committed and loyal employees

Transfer

“a lateral shift causing movement of individuals from one position to another usually without involving any
marked change in duties, responsibilities, skills needed or compensation”

Transfer is defined as “… the moving of an employee from one job to another. It may involve a promotion,
demotion or no change in job status other than moving from one job to another”.

Types of transfer: Rotation transfer, Shift Transfer, Penal Transfer, Replacement Transfer, Personal Transfer,
Personal Transfer

Exit Interview is final formal meeting between the management and an employee leaving the firm. It is used
as a learning opportunity for the executive concerned who seeks candid views on work related problems.

An exit interview is an interview conducted by an employer of a departing employee.

Objectives of Exit Interviews: Presence of exit interview system in an organization confirms the open culture
of an organization to the existing employees as well as to outsiders. They can then believe that the
organization is open to ideas and criticism; that the organization tries to care and understand. Exit interview
system enriches the organization's HR culture, policies and practices.

Attrition

Employee attrition is a situation faced by an organisation or employer when new employees joined leaves
the organisation to join other organisation when he gets offers. Generally employee attrition will be very
high when there is a pressing need of employees in a particular industry due to mass retirements or
expansion of organisation. Normally company faces higher attrition rate when there are more employ ment
opportunities in the market by employers. In broad term, attrition is a situation which employer face when
employee left the organization due to job dissatisfaction, new opportunity in the market, retirement &
natural cause

Retention

Employee Retention is a process in which the employees are encouraged to remain with the organization for
the maximum period of time or until the completion of the project. Employee retention is beneficial for the
organization as well as the employee. Compensation constitutes the largest part of the employee retention
process. The employees always have high expectations regarding their compensation packages.
Compensation packages vary from industry to industry. So an attractive compensation package plays a
critical role in retaining the employees.
Module VI: Current Issues in HRM

Industrial relations has become one of the most delicate and complex problems of modern industrial society.
Industrial progress is impossible without cooperation of labors and harmonious relationships. Therefore, it is
in the interest of all to create and maintain good relations between employees (labor) and employers
(management).

The term ‘Industrial Relations’ comprises of two terms: ‘Industry’ and ‘Relations’. “Industry” refers to “any
productive activity in which an individual (or a group of individuals) is (are) engaged”. By “relations” we
mean “the relationships that exist within the industry between the employer and his workmen.”

The term industrial relations explains the relationship between employees and management which stem
directly or indirectly from union-employer relationship.

The HR Employee Relations Manager directs the organization's employee relations function. They develop
employee relations policies and ensure consistent application of company policies and procedures. In
addition, they are responsible for employee dispute resolution procedures, performing internal audits, and
taking appropriate action to correct any employee relations issues.

Objectives of Industrial Relations:

The main objectives of industrial relations system are:-

 To safeguard the interest of labor and management by securing the highest level of mutual
understanding and good-will among all those sections in the industry which participate in the
process of production.
 To avoid industrial conflict or strife and develop harmonious relations, which are an essential factor
in the productivity of workers and the industrial progress of a country.
 To raise productivity to a higher level in an era of full employment by lessening the tendency to high
turnover and frequency absenteeism.

Dual career group can be defined as a marital couple where both partners are working professionals. Dual
career group helps in achieving the psychological as well as financial satisfactions. Today people are more
concern about increasing level of the responsibilities. They are more committed to work and their personal
growth as well. In other words, dual career group represent the pair of young professionals both husband
and wife. Now a day’s more dual career groups are increasing because more females are highly committed
for quality of work. It provides economic freedom and better social status.

Boxall, P. (1992) defined International Human Resource Management (IHRM) as 'concerned with the
human resource problems of multinational firms in foreign subsidiaries (such as expatriate management) or
more broadly, with the unfolding HRM issues that are associated with the various stages of the
internationalisation process.

IHRM is concerned with HRM issues that cross national boundaries or are conducted in locations other than
the home country headquarters. IHRM is concerned with the relationships between the HRM activities of
organisations and the foreign environments in which the organisations operate.

IHRM approaches

 Ethnocentric: key positions filled by nationals of parent company

 Polycentric: host country nationals recruited to manage subsidiary in their own country
 Geocentric: best people recruited, whatever their nationality
 Regiocentric: best people recruited within region in which the subsidiary operates (e.g. EU, USA).
Founded in 1948, the Society for Human Resource Management (SHRM) is the world’s largest HR
membership organization devoted to human resource management. SHRM provides resources, global best
practices and a network of valuable contacts to more than 5,000 members in over 140 countries, in addition
to U.S.-based HR professionals involved in global HR.

The Human Resource Information System (HRIS) is a software or online solution for the data entry, data
tracking, and data information needs of the Human Resources, payroll, management, and accounting
functions within a business.

Normally packaged as a data base, hundreds of companies sell some form of HRIS and every HRIS has
different capabilities.

Competency approach to job depends on competency mapping. Competency Mapping is a process to

identify key competencies for an organization and/or a job and incorporating those competencies
throughout the various processes (i.e. job evaluation, training, recruitment) of the organization. A
competency is defined as a behavior (i.e. communication, leadership) rather than a skill or ability.

A Human Resources Audit is a comprehensive method (or means) to review current human resources
policies, procedures, documentation and systems to identify needs for improvement and enhancement of
the HR function as well as to assess compliance with ever-changing rules and regulations. An Audit involves
systematically reviewing all aspects of human resources, usually in a checklist fashion.