HUMAN RESOURCE MANAGEMENT N.O.T.E.S UNIT - 1 LESSON 1: CONCEPTUAL FRAMEWORK OF HRM

UNIVERSITY OF DELHI / SCHOOL OF OPEN LEARNING 

B.Com. (Programme) / B.Com. (Hons.)

HUMAN RESOURCE MANAGEMENT

N.O.T.E.S 

UNIT - 1

LESSON 1: CONCEPTUAL FRAMEWORK OF HRM

INTRODUCTION : 

- India is considered an emerging economy and a global outsourcing hub.

- Indian companies have been actively engaged in mergers and acquisitions globally.

- Indian firms purchased 34 foreign companies in the first four months of 1997, amounting to approximately $11 billion.

- India's economic growth has been attributed to factors such as increased inputs (capital and labor) and factor productivity.

- According to Morgan and Stanley, India is projected to become the world's third-largest economy by 2027 and have the third-largest stock market by 2030.

- To achieve successful production processes, industries require four key elements: Machine, Money, Material, and Men.

- Human resources play a crucial role in coordinating and utilizing the other elements effectively.

- Effective human resource management is essential for running a business and performing functions such as recruitment, selection, motivation, policy formulation, and organizing training programs.

- The role of an HR manager is important in overseeing human resource management activities.

CONCEPT AND EVOLUTION OF HRM :

- Human Resource Management (HRM) involves acquiring, training, appraising, and compensating employees, as well as managing their labor relations, health and safety, and fairness concerns.

- HRM is responsible for planning, organizing, directing, and controlling human resources within an organization to achieve individual and societal objectives.

- It focuses on the employment, development, and reward of people in organizations and the management of relationships between management and the workforce.

- HRM involves estimating and identifying human resources, setting standards and policies, developing plans for development, establishing work structures, assigning responsibilities, providing direction, and evaluating performance.

- People are crucial to organizations and offer a competitive advantage through their skills, abilities, and aptitudes.

- HRM has evolved, with early roots in ancient civilizations and significant contributions from scientific management principles and the behavioral school of thought.

- In India, HRM gained importance after the 1930s, initially focusing on compliance with labor laws and later expanding to cover labor welfare, industrial harmony, and human relations.

- The emphasis shifted to developmental aspects of human resources, striking a balance between employee demands and organizational requirements.

- In recent years, HRM has faced challenges due to organizational restructuring, cost-cutting, globalization, changing demographics, and workforce diversity.

- Companies are now focusing on employee capabilities, product/service quality, customer satisfaction, and addressing shortages of skilled workers.

- Workforce diversity has gained significance, considering the cultural, religious, social, and regional backgrounds of employees.

Nature of HRM 

1. Pervasive Force: HRM is present in all enterprises and at all levels of management.

2. Action Oriented: It focuses on problem-solving through rational policies and actions.

3. Individually and Group-Oriented: HRM helps individuals develop their potential and motivates them through recruitment, training, and fair wage policies.

4. Future Oriented: It aims to provide competent and motivated employees to meet organizational goals in the future.

5. Development Oriented: HRM seeks to develop employees' skills, provide training, and maximize their talents through job rotation.

6. Continuous Function: HRM requires constant attention and awareness of human relations in everyday operations.

7. Auxiliary Services: HR departments assist and advise line managers to improve their effectiveness.

8. Comprehensive Function: HRM is concerned with managing people at all levels within an organization.

9. Inter-disciplinary Function: HRM utilizes knowledge from various disciplines to understand and appreciate human behavior in the workplace.

Objectives of HRM :

1. Organization Goals: HRM aims to help the organization achieve its objectives effectively.

2. Efficient Utilization of Workforce: HRM strives to use employees' skills and abilities best.

3. Well-trained and Motivated Employees: HRM ensures employees are motivated, their performance is evaluated, and they are rewarded accordingly.

4. Job Satisfaction and Self-actualization: HRM promotes employees' job satisfaction and encourages personal growth.

5. Effective Communication of HR Policies: HRM communicates policies and collects feedback from internal and external stakeholders.

6. Quality of Work Life: HRM focuses on improving the work environment and employee well-being.

7. Ethical and Social Responsibility: HRM ensures compliance with legal and ethical standards and responds to societal needs.

Summary:

Human Resource Management (HRM) is characterized by its pervasive nature, action-oriented approach, individual and group focus, future orientation, development mindset, continuous function, auxiliary role, comprehensive scope, and interdisciplinary nature. The objectives of HRM include supporting organizational goals, optimizing workforce utilization, nurturing well-trained and motivated employees, promoting job satisfaction and self-actualization, effective communication of HR policies, enhancing the quality of work life, and demonstrating ethical and social responsibility.

Importance of HRM 

Human Resource Management (HRM) plays a crucial role in the success of an organization at various levels - enterprise, individual, society, and national. 

At the enterprise level, HRM aids in attracting and retaining top talent, planning for future workforce needs, providing training and development opportunities, fostering teamwork, and promoting loyalty and commitment through appropriate rewards.

 At the individual level, HRM promotes personal growth, offers career advancement opportunities, and encourages diligence and commitment. 

From a societal perspective, HRM enhances the dignity of labor by providing suitable employment, maintaining a balance between job supply and demand, preserving physical and mental health, and optimizing the utilization of scarce talents. 

At the national level, effective HRM contributes to the efficient utilization of resources, facilitates economic competitiveness, improves the standard of living, and generates better employment opportunities.

Key points:

1. Enterprise Level:

   - Attracts and retains top talent

   - Plans for future workforce needs

   - Provides training and development opportunities

   - Fosters teamwork and loyalty

2. Individual Level:

   - Promotes personal growth and career advancement

   - Offers growth opportunities for talented individuals

   - Encourages diligence and commitment

3. Society Level:

   - Enhances the dignity of labor

   - Provides suitable employment with satisfaction

   - Maintains a balance between job supply and demand

   - Preserves physical and mental health

   - Optimizes utilization of scarce talents

4. National Level:

   - Exploits resources effectively

   - Improves economic competitiveness

   - Enhances the standard of living

   - Generates better employment opportunities

In conclusion, HRM is vital for organizations, individuals, society, and nations as it contributes to attracting talent, fostering growth and commitment, preserving the dignity of labor, and driving economic progress and prosperity.

Functions of HRM 

Human Resource Management (HRM) can be divided into two categories: managerial functions and operating functions. Managerial functions include planning, organizing, directing, and controlling while operating functions focus on specific activities related to procuring, developing, compensating, and maintaining an efficient workforce.

Key points:

I. Managerial Functions:

1. Planning:

   - Forecasts human resource needs and predicts labor market trends.

   - Sets human resource goals, formulates policies and programs, and prepares budgets.

2. Organizing:

   - Allocates tasks, establishes authority-responsibility relationships, and integrates activities.

   - Develops an organizational structure to facilitate the effective implementation of plans.

3. Directing:

   - Motivates, activates, leads, and supervises employees.

   - Maximizes employee potential and fosters sound individual and human relations.

4. Controlling:

   - Checks, verifies and regulates activities to ensure compliance with plans and instructions.

   - Involves auditing training programs, analyzing labor turnover, and conducting separation interviews.

II. Operating Functions :

1. Procurement Function:

   - Involves job analysis, human resource planning, recruitment, selection, placement, and induction.

   - Secures and employs the right people to achieve organizational objectives.

2. Development Function:

   - Improves employees' knowledge, skills, attitudes, and values.

   - Includes performance appraisal, training, executive development, and career planning.

3. Compensation Function:

   - Provides fair and equitable remuneration to employees.

   - Encompasses job evaluation, wage and salary administration, and bonus programs.

4. Integration Function:

   - Reconciles organizational and employee goals.

   - Motivates employees through incentives and handles grievances.

5. Maintenance Function:

   - Protects and promotes employees' physical and mental health.

   - Offers fringe benefits such as housing, medical aid, education, and transportation facilities.

In conclusion, HRM performs managerial functions of planning, organizing, directing, and controlling, as well as operating functions of procuring, developing, compensating, integrating, and maintaining a competent workforce. These functions collectively contribute to the effective management of human resources within an organization.

IN-TEXT QUESTIONS

1. __________is the process of acquiring, training, appraising, and compensating employees, and of attending to their ma relations, health and safety, and fairness concerns.

2. ___________ function refers to providing equitable and fair remuneration to employees for their contribution to the attainment of organizational objectives.

3. In the year 1920-30 Human resource manager was seen in which role?

a) Welfare Administer & Policemen              b) Advisor

c) Educator                                                     d) Trainer

4. The Factories Act came into force in 1910. True/ False.

5. Operating functions of HRM involves planning, organizing, staffing, and controlling True/ False.

ANSWERS :

1. Human resource management (HRM) 

2. The compensation function 

3. a) Welfare Administrator & Po.

4. False. The Factories Act came into force in 1948, not in 1910.

5. False. The operating functions of HRM involve procuring, developing, compensating, and maintaining an efficient workforce. Planning, organizing, staffing, and controlling are managerial functions of HRM.

ROLE, STATUS, AND COMPETENCIES OF HR MANAGER :

Role of HR Manager 

A) Administrative Responsibilities

1. Policy Maker :

- Assists in formulating policies for talent acquisition, retention, compensation, welfare activities, and working conditions.

- Provides interpretation and guidance on personnel policies.

2. Administrative Expert :

- Focuses on processing and record keeping.

- Manages employee files, HR databases, and benefit claims.

- Handles leave queries and administrative tasks.

3. Advisor :

- Offers advice, suggestions, and counseling to line managers.

- Assists with grievance redressal, conflict resolution, employee selection, and training.

4. Housekeeper :

- Manages recruitment processes, including testing, reference checks, and surveys.

- Oversees timekeeping, wage, and salary administration.

5. Counsellor :

- Addresses employee concerns related to work, career, supervisors, colleagues, health, family, finances, and social matters.

- Provides guidance and support for problem-solving.

6. Welfare Officer : 

- Takes responsibility for employee welfare and safety.

- Manages facilities such as canteens, hospitals, creches, educational institutes, clubs, libraries, and cooperative credit societies.

7. Legal Consultant :

- Handles grievance handling, dispute settlement, and disciplinary cases.

- Facilitates joint consultation processes and represents the organization in legal proceedings.

B) Operational Roles

1. Recruiter :

- Focuses on attracting and acquiring talented individuals in a competitive job market.

- Utilizes experience to create attractive career paths for recruits while managing financial constraints.

2. Trainer Developer, Motivator :

- Identifies skill gaps and deficiencies within the workforce.

- Offers training and development opportunities to enhance employee skills and motivation.

3. Linking Pin :

- Acts as a bridge between different divisions within the organization.

- Builds rapport with divisional heads and utilizes communication skills to foster collaboration and cohesion.

4. Mediator :

- Resolves conflicts between employees, employee groups, superiors, subordinates, and management.

- Aims to maintain harmonious relationships and promote a positive work environment.

C) Strategic Roles :

1. Building Core Competency :

- Plays a vital role in developing unique strengths, such as human resources, marketing capabilities, or technological capabilities.

- Organizing the business around core competency leads to a competitive advantage.

2. Providing Purposeful Direction :

- Leads and guides individuals and the organization toward a shared vision.

- Ensures that the organization's mission is internalized by every employee, justifying its existence.

3. Creating Competitive Advantage :

- Focuses on maintaining a competitive edge in a globalized marketplace.

- Pursues cost leadership or differentiation strategies to stand out in the industry.

- Relies on a committed and competent workforce to deliver market responsiveness, product quality, and innovation.

4. Facilitation of Change :

- Serves as change ag by actively participating in environmental scanning and development planning.

- Emphasizes the promotion of change rather than maintaining the status quo.

To remember the text on the role, status, and competencies of an HR manager, you can use the mnemonic device "MAP-ATLM-CSC-FBC." Each letter represents a specific category or role:

M: Policy Maker

A: Administrative Expert

P: Advisor

A: Housekeeper

T: Counsellor

L: Welfare Officer

M: Legal Consultant

C: Recruiter

S: Trainer Developer, Motivator

C: Linking Pin

F: Mediator

C: Building Core Competency

S: Providing Purposeful Direction

C: Creating a Competitive Advantage

F: Facilitation of Change

Imagine yourself holding a map (M) that guides you through administrative responsibilities (A) as an HR manager. You offer advice and guidance (P) while keeping things in order like a housekeeper (A). You act as a counselor (T) to address employee concerns and take care of their welfare (L).

You also wear a recruitment hat (C) to attract talented individuals and motivate them through training (S). As a linking pin (C), you build bridges between divisions and resolve conflicts (F) like a mediator.

You focus on building core competency (C) in your strategic roles to create a competitive advantage. You provide purposeful direction (S) and strive to stand out in the industry (C). Finally, you facilitate change (F) and embrace innovation.

Competencies of HR Manager

1. Educational Qualifications :

- Possession of a degree from a recognized university.

- Postgraduate degree or diploma in fields such as sociology, social work, human resource management, industrial relations, law welfare, b law, or an MBA with HRM specialization.

- Additional qualifications like a law degree can be desirable.

2. Personal Attributes : 

- Intelligence: Ability to understand and perceive deeply.

- Communicative Ability: Proficiency in language, effective expression, active listening skills, and clarity in explanations.

- Distinctiveness: Analytical ability, sound judgment, and foresight.

- Leadership Skills: Physical fitness, moral courage, ability to inspire confidence and cooperation, organizational ability, and unbiased attitude.

- Executing Skills: Capability to implement policies and programs swiftly and accurately.

3. Training and Experience :

- Training in industrial psychology, labor legislation, and industrial relations is beneficial for an HR manager.

4. Professional Attitudes :

- HRM is evolving as a profession, and a professional approach is crucial in the global environment.

-An interdisciplinary approach is required, with knowledge of various disciplines such as sociology, psychology, management, engineering, law, and other relevant fields, to develop comprehensive strategies and solutions for effective human resource management.

Once upon a time, there was a dedicated HR manager named Emily. She possessed a degree from a renowned university and pursued postgraduate studies in HR management. Emily's intelligence and exceptional communication skills made her a valuable asset to the company. She continually honed her skills through workshops on industrial psychology, labor legislation, and industrial relations. Emily's distinctiveness in analytical thinking and leadership abilities set her apart. Her commitment to personal growth and staying updated in the field of HR management earned her the respect of colleagues and superiors. Emily's journey showcases the power of education, personal attributes, and continuous learning in achieving success as an HR manager.

Status of HR Manager 

The Evolving Status of Human Resource Managers:

1. The Policeman: In the early days of industrialization, HR managers were seen as enforcers of regulations and rules to control and direct workers.

2. The Law Man: As labor laws were established to protect employee interests, HR managers became advocates for the employers, handling legal battles and conducting inquiries against workers.

3. The Liaison Man: With the rise of powerful trade unions, HR managers took on the role of negotiating and dealing with union representatives on behalf of the organization.

4. The Catering Man: Some progressive employers started providing additional welfare facilities, such as canteens and creches, and HR managers took responsibility for administering these services.

5. The Welfare Man: Today, HR managers are regarded as experts in human relations, focusing on fulfilling the economic, social, and psychological needs of employees to enhance productivity and overall employee well-being.

Overall, the role of HR managers has evolved from being mere enforcers to becoming strategic partners in managing human resources and improving employee satisfaction and productivity.

IN-TEXT QUESTIONS

6. The HR manager will be required to act as a _________ through greater involvement in environmental scanning and development planning

7. The administrative roles of a personnel manager include recruiting, pre-employment testing, reference checking, employee surveys, timekeeping, wage and salary administration, etc. True / False.

8. Roles of an HR manager can be divided into?

a) Operational and administrative                        b) Welfare man and catering man

c) Policeman                                                         d) None of the above

9. Competencies of an HR manager in him acting as a Law and catering man. True/ False.

10.   HR manager also acts as a welfare officer as he arranges access to canteens, hospitals, creches, educational institutes, clubs, libraries, cooperative credit societies, and consumer stores for the employees. True/ False.

ANSWERS :

6.  facilitator of change

7. True. The administrative roles of a personnel manager include recruiting, pre-employment testing, reference checking, employee surveys, timekeeping, wage and salary administration, etc.

8. a) Operational and administrative.

9. False. The competencies of an HR manager involve various roles and responsibilities, but not specifically as a Law and catering man.

10. True. HR managers may act as welfare officers by arranging access to various facilities such as canteens, hospitals, creches, educational institutes, clubs, libraries, cooperative credit societies, and consumer stores for employees.

HR POLICIES 

Characteristics of Human Resource Policies :

1. Based on Objectives: Human resource policies are derived from the human resource objectives of the organization.

2. General Statements: HR policies are broad and provide guidance for decision-making, allowing room for discretion.

3. Reflect Management Intentions: They reflect the intentions of top management regarding the organization's human resources and contain principles of conduct.

4. Standing Plans: HR policies are standing answers to recurring problems and can be used repeatedly.

5. Responsibility for Formulation: The human resource department, in consultation with line managers, is responsible for formulating HR policies.

Overall, human resource policies serve as predetermined courses of action that guide work performance toward organizational objectives and govern the organization's dealings with its employees.

Types of Personnel Policies:

1. Originated Policies: Established by top management to guide executive linking. In a software development company, top management establishes a policy that all employees must undergo annual training on the latest programming languages and technologies to keep up with industry advancements.

2. Appealed Policies: Formulated to address unique situations not covered by existing policies. Example: A marketing company faces a unique situation where a talented employee requests to work remotely due to personal reasons. The management formulates a policy allowing remote work on a case-by-case basis for exceptional circumstances.

3. Imposed Policies: Created under pressure from external agencies like the government or trade associations.

Example: A construction company faces new safety regulations imposed by the government after an accident on one of their sites. The company implements mandatory safety training and enforces stricter safety protocols as per the government's requirements.

4. General Policies: Reflect the organization's philosophy and priorities for overall growth.

Example: A retail chain emphasizes a general policy of promoting diversity and inclusion, stating that they prioritize hiring candidates from diverse backgrounds to foster a welcoming and inclusive work environment.

5. Specific Policies: Cover specific issues such as hiring, rewarding, and bargaining. 

Example: A financial institution implements a specific policy stating that employees must follow a strict dress code when interacting with clients to maintain a professional image.

6. Written/Implied Policies: Implied policies are inferred from members' behavior.

Example: In a small team working on a project, the team leader sets an implied policy that employees should take turns leading meetings to encourage shared responsibility and leadership development, even though it is not explicitly written in the team's guidelines.

Advantages of Personnel Policies:

1. Delegation: Policies enable managers to act confidently without constant consultation.

2. Uniformity: Increase the likelihood of consistent decision-making across different levels.

3. Better Control: Policies facilitate smoother work execution and enhance control.

4. Standard of Efficiency: Policies serve as a benchmark for assessing work execution.

5. Confidence: Policies provide employees with clarity and confidence when facing routine problems.

6. Speedy Decision-Making: Policies streamline decision-making within a defined framework.

Obstacles in Administering Personnel Policies:

1. Managerial Reluctance: Managers may resist policy guidelines that limit their scope and freedom.

2. Conflicts Between Policy Statements: Conflicts can arise between implied and expressed policies, especially regarding employment matters.

3. Inertia in Policy Revision: Personnel policies require constant review and modification, but they often face inertia in initiating desirable changes.

4. Communication Challenges: Personnel policies are difficult to effectively communicate, leading to vagueness and generalities.

5. Lack of HR Information System: Inadequate development of human resources information systems hinders effective policy development and planning.

6. Time and Cost Constraints: Manpower planning, an essential aspect of policy administration, can be time-consuming and expensive.

Coverage of Personnel Policies :

- Social Responsibility: Equity, consideration, and quality of work life.

- Employment Policies: Equal employment opportunities and selection based on job requirements.

- Promotion Policies: Balancing employee growth and organizational talent demands.

- Development Policies: Training criteria, program duration, techniques, trainer qualifications, and self-advancement encouragement.

- Relations Policies: Motivation, morale, communication, leadership styles, grievance procedures, disciplinary procedures, and employee counseling.

Formulation of Personnel Policies :

1. Identify Needs: Determine the areas of personnel management that require policy formulation based on their importance and recurring issues.

2. Collect Data: Gather relevant data from various sources such as past practices, company records, industry surveys, and organizational culture to inform policy formulation.

3. Specify Alternatives: Evaluate different policy alternatives based on their alignment with organizational objectives and choose the most appropriate ones.

4. Communicate the Policy: Effectively communicate the formulated policy throughout the organization using methods such as a Policy Manual, an in-house journal, and discussions with employees.

5. Evaluate the Policy: Regularly review, evaluate, and control personnel policies against established standards to ensure their effectiveness. Conduct annual reviews and specific reviews for certain policies.

IN-TEXT QUESTIONS

11. __________________ cover the principles and rules of conduct governing the dealings of the organization with its employees and set the tone for the administration of personnel programs in a manner conducive to the attainment of the objectives of the organization.

12. General policies cover specific issues such as hiring, rewarding, and bargaining. True / False.

13. Which of the following is the first step of the policy formulation process?

a) Collection of data                                         b) Identifying the needs

c) Evaluation of the policy                               d) Communication of the policy

14. ____________are established by top management deliberately to guide executive linking at various levels.

ANSWERS: 

11. Personnel policies

12. False

13. b) Identifying the needs

14. Originated policies

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