Human Resource Management
(HRM)
TANUSHREE SANWAL
ASSISTANT PROFESSOR KSOM
Course content
Module 1:
Essentials of HRM: Functions of HRM, HRM vs.
HRD, Strategic HRM: Meaning and Roles in
Strategy formulation and implementation,
Barriers to strategic HRM, Linking HR strategy
with business strategy, Roles of HR Manager,
roles of HR in merger and acquisitions,
Technology & HR and changing roles of HR due
to technology, HRM linkage with TQM &
productivity. Case Studies
Human resources: Meaning
Human resources means the collection
of people and their characteristics at
work. These are distinct and unique to
an organization in several ways.
Human resources:
🠶 Definition
Human resources are ”A whole consisting of inter-
related, inter-dependent & interacting
psychological, sociological & ethical components”.
-Michael J. Jucius
🠶 “HRM is a management function concerned with
hiring, motivating and maintaining people in an
organization. It focuses on people in the
organization” (Aswathappa, 2008)
Human resource
management: Definition
Human resource management is
concerned with policies and practices
that ensure the best use of the human
resources for fulfilling the
organizational and individual goals.
-Edwin B.
Flippo
Why do we need
Human Resource Management?
COMPETITIVE HUMAN EMPLOYEE
CHALLENGES RESOURCES CONCERNS
• Globalization • Planning • Background diversity
• Technology • Job design • Age distribution
• Managing change • Staffing • Gender issue
• Human capital • Training & • Educational level
• Responsiveness Development • Employee right
• Cost containment • Appraisal • Privacy issue
• Compensation • Work attitude
• Benefits • Family concern
• Labor relations
Characteristics of HRM
• People oriented
• Action- oriented
• Individual- oriented
• Development – oriented
• Pervasive Function
• Continuous Function
• Future- oriented
• Challenging function
• Science as well as art
• Staff function
• Young discipline
Objectives of HRM
🠶 To act as a liaison between the top management
and the employees.
🠶 To arrange and maintain adequate manpower
inventory
🠶 To devise employee benefit schemes
🠶 To ensure and enhance the quality of work life
🠶 To offer training
🠶 To help keep up ethical values and behaviour
amongst employees both within and outside the
organization.
🠶 To maintain high morale and good human
relations within the organization.
Scope of HRM
1. Personnel or Labour Aspect
Planning, recruiting, selection, placement, transfer,
promotion, training and development, Lay-offs,
retrenchment, remuneration, incentives and productivity
2. Welfare Aspect
Housing, transport, medical assistance,
canteen, rest rooms, health and safety,
education, etc.
3. Industrial Relation Aspect
Union-management relations, collective
bargaining, grievance and disciplinary
actions, settlement of disputes.
Difference between HRM
and PM
🠶 HRM is proactive in nature while PM is reactive.
🠶 HRM is a resource-centered activity whereas PM is
an employee-centered activity.
🠶 HRM emphasizes flexible, open-ended contracts but
PM emphasizes the strict observance of defined
rules, procedures, and contracts.
🠶 HRM views better performance as a cause of job
satisfaction whereas PM considers job satisfaction
as a source of better performance….
Functions of human resource
management
Operative functions of HRM
Significance of HRM
🠶 Significance for an enterprise
🠶 Professional significance
🠶 Social significance
🠶 National significance
Significance of HRM
🠶Significance for an enterprise
🠶Attracting & retaining the required
human resource, recruitment & selection
, placement , orientation, compensation
& promotion policies.
❖Developing the skills & necessary
attitude among the employees by T&D
& performance evaluation
❖Providing them social & job security
by grievance handling, motivating &
participation in mgt
❖Utilizing effectively the available
human resources
❖Ensuring that the enterprise will have
in future a team of competent &
dedicated employees.
Significance of HRM
🠶Professional significance
❖ Providing maximum
opportunities for personal
development of each
employee.
❖Maintaining healthy
relationships among individual
& different work groups.
❖Allocating work properly.
Significance of HRM
🠶Social Significance
❖Sound human resources management has
a great significant for the society. It help to
enhance the dignity of labour in the
following ways.
✔Providing suitable employment that
provides social & psychological satisfaction
to people.
✔Maintaining a balance between the job
available & the jobseekers in terms of
numbers, Qualification, needs & aptitudes.
✔Eliminating waste of human resource
through conservation of physical & metal
health
Significance of HRM
National Significance
🠶Human resource & their management plays a vital role in the
development of a nation. The effective exploitation &
utilisation of a nation’s natural, physical & financial
resources require an efficient & committed manpower.
🠶There are wide differences in development between
countries are with similar resources due to differences in the
quality of their people.
🠶Countries are underdeveloped because their people are
backward. The level of development in a country depends
primarily on the skills , attitudes & values of its human
resources. effective management of human resources helps to
speed up the process of economic growth which in turn leads
to higher standards of living & fuller employment
🠶Human resource Management is the central subsystem of an
organisation.
Evolution of HRM
1. The Industrial Revolution(beyond 1820 to 1840)
2. Trade unionism(1841 to 1909)
3. Scientific Management (1910 evolve & 1920
implementation to 1940)
4. Industrial Psychology (1945 to 1970)
5. Human Relation Movement Era( 1971 to 1980)
6. Behavioural Science (1980 to 1990)
7. The Contemporary HRM Era (1990 onwards)
The Industrial Revolution(beyond 1820 to 1840)
• Usages of the machinery
• Mass level of production
• To satisfied the human need
• Profit maximization form the factor of
production like land , labour, capital,
entrepreneur
Trade unionism(1841 to 1909)
•
World have been separated in two
type of economy one is capitalization
which has a motive of profit
maximization other other side labour
intensive economy
Labour class reflected their provouge
by strike, slowdown, pen down,
boycott & sabotage of the work for
resolution of the problem where new
redressal procedure had been
developed to subside the chaos like
collective bargaining, grievance
handling system, arbitration,
disciplinary practices
Scientific Management (1910 evolve & 1920 implementation to 1940)
● Development of true • Draw back
science
• Man become
● Scientific selection &
training machine human
● Friendly co-operation factors were
between management completely
● Development of every avoided.
worker to his fullest
aspects.
Industrial psychology era
(1945 to 1970)
🠶 Mainly focused on the part on IQ of the employees
through MMPIT(Minnesotta multiple personality
test )or MBTI( Myer Brigg Jung topology) & assigned
them skill & aptitude based job.
Human relation movement
( 1971 to 1980)
🠶 Hawthorne experiment
🠶 Interaction with the employee increase the
productivity
🠶 Basic facilities are required for the production
🠶 Empathized view towards workes have increased
productivity of worker
🠶 Social and Psychological factors play an important
role.
Behavioural Science era
(1980 to 1990)
🠶 Multiple branch discipline like
sociology , anthropology,
psychology, economics & politics
🠶 Contributors:- Abraham Maslow,
Douglas mc gregeor, Fredrik
Herzberg, Rensis Likert, Robert
black, Robert Owen, kurt lewin,
burke letwin, fidler contingent
theory, victor vroom theory, grid
theory, Aldofer ERG theory, Mclland
N-ach theory
The Contemporary HRM era
(1990 onwards)
🠶 More focused on gaining competitive advantage in
market through HR.
🠶 Focuses on developing HR strategies, aligning them
with corporate strategy and achieving
organizational goals effectively.
The Meaning of “Strategy”
🠶A critical factor that affects Firm Performance
🠶 A factor that contributes to Competitive Advantage in markets
🠶 Having a long-term focus
🠶 Plans that involve the top executives and/or board of directors of
the firm
🠶 A general framework that provides a perspective for selecting
specific policies and procedures
🠶What is Strategic Management?
🠶Strategic Management is a process for analyzing a company's competitive
situation, developing the company's strategic goals, and devising a plan of
action and allocation of resources that will help a company achieve its goals.
Strategic HRM
🠶 Strategic human resource management can be
defined as the linking of human resources with
strategic goals and objectives in order to
improve business performance and develop
organizational culture that foster innovation,
flexibility and competitive advantage.
🠶 In an organization shrm means accepting and
involving the hr function as a strategic partner
in the formulation and implementation of the
company's strategies through hr activities such
as recruiting, selecting, training and rewarding
personnel.
🠶 Strategic human resource management focuses
on human resource programs with long-term
objectives. Instead of focusing on internal
human resource issues
1-11
The evolving strategic role of
Human Resource Management
Strategic focus
Strategic partner Change agent
System People
Administrative expert Employee champion
Operational focus
The Strategic Role Of Human Resources Management
The Strategic Management Process includes:
– Determining what needs to be done to
achieve corporate objectives, often over 3 - 5
years
– Examining organization and competitive
environment
– Establishing optimal fit between organization
and its environment
– Reviewing and revising strategic plan
Model of Strategic HR Management
LEVELS OF STRATEGY-SRM
SHRM Process
1-13
Traditional HR vs. Strategic HR
Point of distinction Traditional HR Strategic HR
Focus Employee Relations Partnerships with internal and
external customers
Role of HR Transactional change Transformational change leader
follower and respondent and initiator
Initiatives Slow, reactive, fragmented Fast, proactive and integrated
Time horizon Short-term Short, medium and long (as
required)
Control Bureaucratic-roles, policies, Organic-flexible, whatever is
procedures necessary to succeed
Job design Tight division of labour; Broad, flexible, cross-training
independence, teams
specialisation
Key investments Capital, products People, knowledge
Accountability Cost centre Investment centre
The Strategic Role Of Human Resources Management
Importance of Strategic Human Resource
Management
🠶 The primary goal of strategic human resource management is to solve
business objectives or obstacles that may not occur within the direct
purview of HRM.
🠶 Cross cultural issues and interaction
🠶 Internationalization
🠶 Changing ownership due to increased M & A
🠶 Rapidly changing business environments
🠶 Technological advancements
Barriers to Strategic Human Resource
Management
▪ Short term mentality
▪ Strategic inability
▪ Lack of appreciation
▪ Failure understands the role
▪ Difficulty in quantifying outcomes
▪ Wrong perception of human assets
▪ Resistance
GROWTH LEVEL STRATEGY
🠶 A growth strategy is an organization's plan for overcoming current
and future challenges to realize its goals for expansion. Examples of
growth strategy goals include increasing market share and revenue,
acquiring assets, and improving the organization's products or
services.
🠶 Four types of Growth Strategy are-
🠶 Market Expansion or Development
🠶 Product Expansion Strategy
🠶 Growth Through Diversification
BUSINESS LEVEL STRATEGY
🠶 Business-level strategy: an integrated and coordinated set of
commitments and actions the firm uses to gain a competitive
advantage by exploiting core competencies in specific product
markets.
🠶 Basis of choosing a business level strategy by determining how well
a company can compete –
🠶 What customer need will be satisfied?
🠶 Who is to be satisfied?
🠶 How will the need be satisfied?
TYPES OF STRATEGIES
🠶 Vertical intégration.-Vertical integration allows the firm to
enlarge its scope of operations within the same overall
industry. It takes place when one firm acquires another that is
involved either in an earlier stage of the production process
(backward or upstream) or a later stage of the production
process (forward or downstream).
🠶 Diversification-A firm can expand its operations by launching
new products or new lines of business. It can enter new
markets as well.
🠶 Divestiture-A divestiture is the partial or full disposal of a
business unit through sale, exchange, closure, or
bankruptcy. A divestiture most commonly results from a
management decision to cease operating a business unit
because it is not part of a company's core competency.
🠶 Liquidation-The Liquidation Strategy is the most unpleasant
strategy adopted by the organization that includes selling off
its assets and the final closure or winding up of the business
operations.
Strategic human resource challenge-CO1
🠶 1. Increase the quality of leadership and management
🠶 2. Manage the changing business needs for talent and skills
🠶 3. Define a forward-looking workforce strategy
🠶 4. Foster innovation throughout the organization
🠶 5. Use data analytics to improve HR-related decisions
Types of Strategic Fit
⮚ Vertical Fit- managed by directing human resources toward the
primary initiatives of the organization.
Vertical fit is the main idea of HRS, and is linked to a contingency
based approach and hence creating an overall fit of the various
management strategies (including HRS) in the long term goal.
⮚ Horizontal fit - Horizontal fit is achieved by efficiently allocating
the resources.
The horizontal fit is bothered as to how the processes and activities
planned by the HR department and their management of the
resources available to them, are applied within the organization and
complements the vertical fit.
Qualities of an HR manager
🠶 Knowledge
🠶 Intelligence
🠶 Communication skills
🠶 Objectivity and fairness
🠶 Leadership and motivational qualities
🠶 Emotional maturity and
🠶 Empathy
HR Managers Duties
LINE-AND-STAFF
AUTHORITY
🠶 Authority within a line-and-staff organization can be
differentiated. Three types of authority are present:
line, staff, and functional.
🠶 Line authority is the right to carry out assignments
and exact performance from other individuals.
🠶 Line authority flows down the chain of command.
For example, line authority gives a production
supervisor the right to direct an employee to
operate a particular machine, and it gives the vice
president of finance the right to request a certain
report from a department head. Therefore, line
authority gives an individual a certain degree of
power relating to the performance of an
organizational task.
STAFF AUTHORITY
🠶 Staff authority is the right to advise or counsel those
with line authority. For example, human resource
department employees help other departments by
selecting and developing a qualified workforce.
🠶 A quality control manager aids a production
manager by determining the acceptable quality
level of products or services at a manufacturing
company, initiating quality programs, and carrying
out statistical analysis to ensure compliance with
quality standards.
🠶 Therefore, staff authority gives staff personnel the
right to offer advice in an effort to improve line
operations.
FUNCTIONAL AUTHORITY
🠶 Functional authority is referred to as limited line
authority. It gives a staff person power over a
particular function, such as safety or accounting.
🠶 Usually, functional authority is given to specific staff
personnel with expertise in a certain area. For
example, members of an accounting department
might have authority to request documents they
need to prepare financial reports, or a human
resource manager might have authority to ensure
that all departments are complying with equal
employment opportunity laws.
🠶 Functional authority is a special type of authority for
staff personnel, which must be designated by top
management.
Changing roles of HR
Changing roles of HR
Managing Challenges Affecting a Human
Resource Manager
The dynamic role of HR in Merger &
Acquisitions
🠶 The Human Resource (HR) department plays a
pivotal role in the process of merger and acquisition
between two companies.
🠶 HR plays a key role in managing all crises as well as
disputes that may crop up in an organization, as and
when the process of merger and acquisition sets off.
🠶 The Human Resource department acts as a trusted
adviser to the employees of an organization along
with the management who intend to enter to an
M&A deal.
🠶 In fact, the Human Resource team of an
organization plays a dynamic role in leadership
during any merger and acquisition.
Analyzing Organizational
Cultures
• Management trend of the two organizations
• How the employees of two organizations think?
• Growth rate of the merging companies
• Cultural differences between the two organizations
• How the two organizations view each other?
• Selectivity in hiring
• Benefits enjoyed by the employees, such as insurance and
perks
• Rates of employee turnover
• Level of estrangement experienced by employees.
• Readiness or attitude of employees to embrace new corporate
culture
Boosting the Morale of Anxious
Employees
🠶 Boosting the confidence of employees
🠶 Offering adequate training to managers so that they can
acclimatize themselves to the nature of change and new
organizational culture
🠶 Brushing away the fears and doubts of employees, so as to
retain productivity
🠶 Ensuring job security
🠶 Explaining news roles to each employee
🠶 Expounding the hierarchy structure of the organization
post-merger
🠶 Elucidating how the joint venture will affect each employee
in person
🠶 Upholding efficiency by identifying leaders from
both organizations
🠶 Enhancing innovation by placing the right employee
at the right position
🠶 Complying with labour laws
🠶 Supervising personal records
🠶 Keeping the communication channel open through
constant communication with the employees and
conveying their concerns to the management.
🠶 Providing timely input throughout the M&A process
Conducting orientation programs on welfare
schemes, compensations, benefits, and company
policies
Solving Employee Benefits
Issues
🠶 The objective of due diligence process in M&A is the
verification of Seller’s financials by the Buyer
Company, along with the confirmation of all deals,
customers and other relevant information.
🠶 This is done by the buyer to assess if the M&A deal
make any financial or strategic sense. HR
department of the buyer company particularly
evaluates the benefit structure of the seller
company to discover the likelihood of any imminent
problem such as inadequate funds for pension plan
or continuation of any medical insurance plan that
may cost an arm and a leg to the organization in the
long run.
HR Plays a Substantial Role in Merger
& Acquisitions
🠶 Before the merger or acquisition takes place, the
HR managers of both the firms should advise the
management to map out a roadmap in advance so
that the merging companies can stick to it as soon
as the M&A procedure gets going.
🠶 The strategy should stress on the organizational
communication structure, layoffs (if any), and
amalgamation of corporate cultures. This initiative
by HR leaders helps the management to conform to
a specific set of objectives, thus driving away all
misunderstandings and differences that may come
up in the future.
How technology has changed human
resource management
• Smart recruitment is one of the changes in HR due t
o technology
• Better performance management is technology influ
ence on human resource
• Better diversity and inclusion is a change due to tec
hnology in HR
• HR has become more strategic due to HR Technolog
y
• Better Communication and Collaboration is an impa
ct of technology in HR
MODELS OF HRM
THE HARVARD MODEL
THE WARWICK MODEL
THE 5 P’s MODEL
3-8
Total Quality Management
Programmes
TQM is a way of creating an organisational
culture committed to the continuous
improvement of skills, teamwork, processes,
product and service quality and customer
satisfaction.
Eg: Bharat Heavy Electricals Ltd First to get ISO 9001 certification
TQM CYCLE
3-9
TQM: The main ideas
❖ Do it right the first time
❖ Be customer oriented
❖ Make continuous improvement a way of life
❖ Build teamwork
❖ Empower people
❖ Create a climate of trust, an atmosphere for
innovation
ROLE OF HRM FOR TQM
THANK YOU
