INTRODUCTION:

Human resource (or personnel) management, in the sense of getting things done
through people. It's an essential part of every manager's responsibilities, but many
organizations find it advantageous to establish a specialist division to provide an
expert service dedicated to ensuring that the human resource function is performed
efficiently.

Human resource management (HRM) is the effective

management of people at work.
HRM examines what can or should be done to make working
people more productive
and satisfied. This book has been written for individuals interested
in learning about people
working within organizations. Its goal is to help develop more
effective managers

"People are our most valuable asset" is a cliché which no member of any senior
management team would disagree with. Yet, the reality for many organizations is
that their people remain

• under valued
• under trained
• under utilized
• poorly motivated, and consequently
• perform well below their true capability

ACCORDING TO EDVIN FLIPPO

Edwin Flippo defies HRM as “planning, organizing, directing,
controlling of procurement, development, compensation,
integration , maintenance and separation of human resources to
the end that individual, organizational and social objectives are
achieved.”

. Thefollowing four descriptions of the HRM unit should be

stressed at the outset:

1. It is action-oriented Effective HRM focuses on action

rather than on record keeping,
written procedure, or rules. Certainly, HRM uses rules, records,
and policies, but it
stresses action. HRM emphasizes the solution of employment
problems to help achieve
organizational objectives and facilitate employees’ development
and satisfaction.

2. It is people-oriented Whenever possible, HRM treats each

employee as an individual and
offers services and programs to meet the individual’s needs.
McDonald’s, the fast-food
chain, has gone so far as to give an executive the title vice
president of individuality.

3. It is globally oriented HRM is a globally oriented function or

activity; it is being practiced
efficiently and continuously in Mexico, Poland, and Hong Kong.
Many organizations
around the world treat people fairly, with respect, and with
sensitivity. Thus,
American practitioners can review best-in-class HRM practices in
Brazil to determine
if some principles can be applied or modified to work in the United
States.

4. It is future-oriented Effective HRM is concerned with helping

an organization achieve
its objectives in the future by providing for competent, well-
motivated employees. Thus,
human resources need to be incorporated into an organization’s
long-term strategic
plans.
The following HR Journal of Malden Mills Company captures HRM
at the peak of effectiveness.
This company did not allow a devastating fire to shut it down.
Staffed by people
of many nations of the world, the company, with the help of a
people-oriented leader, Aaron
Feuerstein, showed tenacity, dedication, and loyalty in their
decision to rebuild.

Features of HRM or characteristics or nature

1. HRM involves management functions like planning, organizing,

directing and controlling.

2. It involves procurement, development, maintenance of human

resource

3. It helps to achieve individual, organizational and social

objectives

4. HRM is a mighty disciplinary subject. It includes the study of

management psychology communication, economics and
sociology.

5. It involves team spirit and team work.

Evolution of HRM

The evolution of HRM can be traced back to Kautilya Artha

Shastra where he recommends that government must take active
interest in public and private enterprise. He says that government
must provide a proper procedure for regulating employee and
employee relation.
In the medieval times there were examples of kings like Allaudin
Khilji who regulated the market and charged fixed prices and
provided fixed salaries to their people. This was done to fight
inflation and provide a decent standard of living
During the pre independence period of 1920 the trade union
emerged. Many authors who have given the history of HRM say
that HRM started because of trade union and the First World War.
The Royal commission in 1931 recommended the appointment of
a labour welfare officer to look into the grievances of workers.
The factory act of 1942 made it compulsory to appoint a labour
welfare officer if the factory had 500 or more than 500 workers.
The international institute of personnel management and national
institute of labour management were set up to look into problems
faced by workers to provide solutions to them. The Second World
War created awareness regarding workers rights and 1940’s to
1960’s saw the introduction of new technology to help workers.
The 1960’s extended the scope of human resource beyond
welfare. Now it was a combination of welfare, industrial relation,
administration together it was called personnel management.
With the second 5 year plan, heavy industries started and
professional management became important. In the 70’s the
focus was on efficiency of labour wile in the 80’s the focus was on
new technology, making it necessary for new rules and
regulations. In the 90’s the emphasis was on human values and
development of people and with liberalization and changing type
of working people became more and more important there by
leading to HRM which is an advancement of personnel
management.

Scope of HRM/functions of HRM

The scope of HRM refers to all the activities that come under the
banner of HRM. These activities are as follows-

1. Human resources planning :-

Human resource planning or HRP refers to a process by which the
company to identify the number of jobs vacant, whether the
company has excess staff or shortage of staff and to deal with
this excess or shortage.
2. Job analysis design :-
Another important area of HRM is job analysis. Job analysis gives
a detailed explanation about each and every job in the company.
Based on this job analysis the company prepares advertisements.

3. Recruitment and selection :-

Based on information collected from job analysis the company
prepares advertisements and publishes them in the news papers.
This is recruitment. A number of applications are received after
the advertisement is published, interviews are conducted and the
right employee is selected thus recruitment and selection are yet
another important area of HRM.

4. Orientation and induction :-

Once the employees have been selected an induction or
orientation program is conducted. This is another important area
of HRM. The employees are informed about the background of the
company, explain about the organizational culture and values and
work ethics and introduce to the other employees.

5. Training and development :-

Every employee goes under training program which helps him to
put up a better performance on the job. Training program is also
conducted for existing staff that have a lot of experience. This is
called refresher training. Training and development is one area
were the company spends a huge amount.

6. Performance appraisal :-
Once the employee has put in around 1 year of service,
performance appraisal is conducted that is the HR department
checks the performance of the employee. Based on these
appraisal future promotions, incentives, increments in salary are
decided.

7. Compensation planning and remuneration :-

There are various rules regarding compensation and other
benefits. It is the job of the HR department to look into
remuneration and compensation planning.

8. Motivation, welfare, health and safety :-

Motivation becomes important to sustain the number of
employees in the company. It is the job of the HR department to
look into the different methods of motivation. Apart from this
certain health and safety regulations have to be followed for the
benefits of the employees. This is also handled by the HR
department.

9. Industrial relations :-
Another important area of HRM is maintaining co-ordinal relations
with the union members. This will help the organization to
prevent strikes lockouts and ensure smooth working in the
company.
Challenges before the HR manager/before modern
personnel management

Personnel management which is know as human resource

management has adapted itself to the changing work
environment, however these changes are still taking place and
will continue in the future therefore the challenges before the HR
manager are

1. Retention of the employees :-

One of the most important challenge the HR manager faces is
retention of labour force. Many companies have a very high rate
of labour turnover therefore HR manager are required to take
some action to reduce the turnover

2. Multicultural work force :-

With the number of multi cultural companies are increasing
operations in different nations. The work force consists of people
from different cultures. Dealing with each of the needs which are
different the challenge before the HR manager is integration of
multicultural labour work force.

3. Women in the work force :-

The number of women who have joined the work force has
drastically increased over a few years. Women employees face
totally different problems. They also have responsibility towards
the family. The organization needs to consider this aspect also.
The challenge before the HR manager lies in creating gender
sensitivity and in providing a good working environment to the
women employees.

4. Handicapped employees :-
This section of the population normally faces a lot of problems on
the job, very few organization have jobs and facilities specially
designed for handicapped workers. Therefore the challenge
before the HR manager lies in creating atmosphere suitable for
such employees and encouraging them to work better.

5. Retrenchment for employees :-

In many places companies have reduced the work force due to
changing economic situations, labourers or workers who are
displaced face sever problems. It also leads to a negative
atmosphere and attitude among the employees. There is fear and
increasing resentment against the management. The challenge
before the HR manager lies in implementing the retrenchment
policy without hurting the sentiments of the workers, without
antagonizing the labour union and by creating positive attitude in
the existing employees.

6. Change in demand of government :-

Most of the time government rules keep changing. While a lot of
freedom is given to companies some strict rules and regulations
have also been passed. The government has also undertaken the
disinvestment in certain companies due to which there is fear
among the employees regarding their job. The challenge before
the HR manager lies in convincing employees that their interest
will not be sacrificed.

7. Initiating the process of change :-

Changing the method of working, changing the attitude of people
and changing the perception and values of organization have
become necessary today. Although the company may want to
change it is actually very difficult to make the workers accept the
change. The challenge before the HR manager is to make people
accept change.

Significance/importance/need of HRM

HRM becomes significant for business organization due to the

following reasons.

1. Objective :-
HRM helps a company to achieve its objective from time to time
by creating a positive attitude among workers. Reducing wastage
and making maximum use of resources etc.

2. Facilitates professional growth :-

Due to proper HR policies employees are trained well and this
makes them ready for future promotions. Their talent can be
utilized not only in the company in which they are currently
working but also in other companies which the employees may
join in the future.

3. Better relations between union and management :-

Healthy HRM practices can help the organization to maintain co-
ordinal relationship with the unions. Union members start
realizing that the company is also interested in the workers and
will not go against them therefore chances of going on strike are
greatly reduced.

4. Helps an individual to work in a team/group :-

Effective HR practices teach individuals team work and
adjustment. The individuals are now very comfortable while
working in team thus team work improves.

5. Identifies person for the future :-

Since employees are constantly trained, they are ready to meet
the job requirements. The company is also able to identify
potential employees who can be promoted in the future for the
top level jobs. Thus one of the advantages of HRM is preparing
people for the future.

6. Allocating the jobs to the right person :-

If proper recruitment and selection methods are followed, the
company will be able to select the right people for the right job.
When this happens the number of people leaving the job will
reduce as the will be satisfied with their job leading to decrease in
labour turnover.

7. Improves the economy :-

Effective HR practices lead to higher profits and better
performance by companies due to this the company achieves a
chance to enter into new business and start new ventured thus
industrial development increases and the economy improves.
Functional overview and strategy for HRM

This set of resources are offered to promote thought, stimulate discussion, diagnose
the organizational environment and develop a sound human resource management
strategy for your organization. We begin by looking at the seven distinguishable
function human resource management provide to secure the achievement of the
objective defined above.

Function 1: Manpower planning

Planning staff levels requires that an assessment of present and future needs of the
organization be compared with present resources and future predicted resources.
Appropriate steps then be planned to bring demand and supply into balance.

Thus the first step is to take a 'satellite picture' of the existing workforce profile
(numbers, skills, ages, flexibility, gender, experience, forecast capabilities,
character, potential, etc. of existing employees) and then to adjust this for 1, 3 and
10 years ahead by amendments for normal turnover, planned staff movements,
retirements, etc, in line with the business plan for the corresponding time frames.

Future staffing needs will derive from:

• Sales and production forecasts

• The effects of technological change on task needs
• Variations in the efficiency, productivity, flexibility of labor as
a result of training, work study, organizational change, new
motivations, etc.
• Changes in employment practices (e.g. use of
subcontractors or agency staffs, hiving-off tasks, buying in,
substitution, etc.)
• Variations, which respond to new legislation, e.g. payroll
taxes or their abolition, new health and safety requirements
• Changes in Government policies (investment incentives,
regional or trade grants, etc.)

That, in turn, will involve the further planning of such recruitment, training,
retraining, labor reductions (early retirement/redundancy) or changes in workforce
utilization as will bring supply and demand into equilibrium, not just as a one–off
but as a continuing workforce planning exercise the inputs to which will need
constant varying to reflect 'actual' as against predicted experience on the supply
side and changes in production actually achieved as against forecast on the demand
side.

Function 2: Recruitment and selection of employees

Recruitment of staff should be preceded by:

An analysis of the job to be done (i.e. an analytical study of the tasks to be

performed to determine their essential factors) written into a job description so that
the selectors know what physical and mental characteristics applicants must
possess, what qualities and attitudes are desirable and what characteristics are a
decided disadvantage;

The main sources of recruitment are:

• Internal promotion and internal introductions (at times

desirable for morale purposes)
• Careers officers (and careers masters at schools)
• University appointment boards
• Agencies for the unemployed
• Advertising (often via agents for specialist posts) or the use
of other local media (e.g. commercial radio)

Where the organization does its own printed advertising it is useful if it has some
identifying logo as its trade mark for rapid attraction and it must take care not to
offend the sex, race, etc. antidiscrimination legislation either directly or indirectly.
The form on which the applicant is to apply (personal appearance, letter of
application, completion of a form) will vary according to the posts vacant and
numbers to be recruited.

Interviewing can be carried out by individuals (e.g. supervisor or departmental

manager), by panels of interviewers or in the form of sequential interviews by
different experts and can vary from a five minute 'chat' to a process of several days.
Ultimately personal skills in judgment are probably the most important, but
techniques to aid judgment include selection testing for:

• Aptitudes (particularly useful for school leavers)

• Attainments
• General intelligence
(All of these need skilled testing and assessment.) In more senior posts other
techniques are:

• Leaderless groups
• Command exercises
• Group problem solving

(These are some common techniques - professional selection organizations often

use other techniques to aid in selection.)

Function 3: Employee motivation

To retain good staff and to encourage them to give of their best while at work
requires attention to the financial and psychological and even physiological
rewards offered by the organization as a continuous exercise.

Basic financial rewards and conditions of service (e.g. working hours per week)
are determined externally (by national bargaining or government minimum wage
legislation) in many occupations but as much as 50 per cent of the gross pay of
manual workers is often the result of local negotiations and details (e.g. which
particular hours shall be worked) of conditions of service are often more important
than the basics. Hence there is scope for financial and other motivations to be used
at local levels.

As staffing needs will vary with the productivity of the workforce (and the
industrial peace achieved) so good personnel policies are desirable. The latter can
depend upon other factors (like environment, welfare, employee benefits, etc.) but
unless the wage packet is accepted as 'fair and just' there will be no motivation

Function 4: Employee evaluation

An organization needs constantly to take stock of its workforce and to assess its
performance in existing jobs for three reasons:

• To improve organizational performance via improving the

performance of individual contributors (should be an
automatic process in the case of good managers, but (about
annually) two key questions should be posed:
 o what has been done to improve the performance of a
person last year?
o and what can be done to improve his or her
performance in the year to come?).
• To identify potential, i.e. to recognize existing talent and to
use that to fill vacancies higher in the organization or to
transfer individuals into jobs where better use can be made
of their abilities or developing skills.
• To provide an equitable method of linking payment to
performance where there are no numerical criteria (often
this salary performance review takes

Basically an evaluation / appraisal scheme is a formalization of what is done in a

more casual manner anyway (e.g. if there is a vacancy, discussion about internal
moves and internal attempts to put square pegs into 'squarer holes' are both the
results of casual evaluation). Most managers approve merit payment and that too
calls for evaluation. Made a standard routine task, it aids the development of talent,
warns the inefficient or uncaring and can be an effective form of motivation

Function 5: Industrial relations

Good industrial relations, while a recognizable and legitimate objective for an

organization, are difficult to define since a good system of industrial relations
involves complex relationships between:

(a) Workers (and their informal and formal groups, i. e. trade union, organizations
and their representatives);

(b) Employers (and their managers and formal organizations like trade and
professional associations);

(c) The government and legislation and government agencies l and 'independent'
agencies like the Advisory Conciliation and Arbitration Service.

Oversimplified, work is a matter of managers giving instructions and workers

following them - but (and even under slavery we recognize that different
'managing' produces very different results) the variety of 'forms' which have
evolved to regulate the conduct of parties (i.e. laws, custom and practice,
observances, agreements) makes the giving and receipt of instructions far from
simple. Two types of 'rule' have evolved:

• 'Substantive', determining basic pay and conditions of

service (what rewards workers should receive);
• 'Procedural,' determining how workers should be treated and
methods and procedures.

Determining these rules are many common sense matters like: Financial, policy
and market constraints on the parties (e.g. some unions do not have the finance to
support industrial action, some have policies not to strike, some employers are
more vulnerable than others to industrial action, some will not make changes
unless worker agreement is made first, and rewards always ultimately reflect what
the market will bear);

Broadly in the Western style economies the parties (workers and employers) are
free to make their own agreements and rules. This is called 'voluntarism'. But it
does not mean there is total noninterference by the government. That is necessary
to:

• Protect the weak (hence minimum wage);

• Outlaw discrimination (race or sex);
• Determine minimum standards of safety, health, hygiene
and even important conditions of service;
• To try to prevent the abuse of power by either party.

Function 6: Provision of employee services

Attention to the mental and physical well-being of employees is normal in many

organizations as a means of keeping good staff and attracting others.

The forms this welfare can take are many and varied, from loans to the needy to
counseling in respect of personal problems.

Among the activities regarded as normal are:

• Schemes for occupational sick pay, extended sick leave and

access to the firm's medical adviser;
• Schemes for bereavement or other special leave;
• The rehabilitation of injured/unfit/ disabled employees and
temporary or permanent move to lighter work;
 • The maintenance of disablement statistics and registers
(there are complicated legal requirements in respect of
quotas of disabled workers and a need for 'certificates'
where quota are not fulfilled and recruitment must take
place);
• Provision of financial and other support for sports, social,
hobbies, activities of many kinds which are work related;
• Provision of canteens and other catering facilities;
• Possibly assistance with financial and other aid to employees
in difficulty (supervision, maybe, of an employee managed
benevolent fund or scheme);
• Provision of information handbooks,
• Running of pre-retirement courses and similar fringe
activities;
• Care for the welfare aspects of health and safety legislation
and provision of first-aid training.

Function 7: Employee education, training and development

In general, education is 'mind preparation' and is carried out remote from the actual
work area, training is the systematic development of the attitude, knowledge, skill
pattern required by a person to perform a given task or job adequately and
development is 'the growth of the individual in terms of ability, understanding and
awareness'.

Within an organization all three are necessary in order to:

• Develop workers to undertake higher-grade tasks;

• Provide the conventional training of new and young workers
(e.g. as apprentices, clerks, etc.);
• Raise efficiency and standards of performance;
• Meet legislative requirements (e.g. health and safety);
• Inform people (induction training, pre-retirement courses,
etc.);

Evaluation of the effectiveness of training is done to ensure that it

is cost effective, to identify needs to modify or extend what is
being provided, to reveal new needs and redefine priorities and
most of all to ensure that the objectives of the training are being
met.

Developing a HRM strategy

Faced with rapid change organizations need to develop a more focused and
coherent approach to managing people. In just the same way a business requires a
marketing or information technology strategy it also requires a human resource or
people strategy.

In developing such a strategy two critical questions must be addressed.

• What kinds of people do you need to manage and run your

business to meet your strategic business objectives?
• What people programs and initiatives must be designed and
implemented to attract, develop and retain staff to compete
effectively?

In order to answer these questions four key dimensions of an organization must be

addressed. These are:

• Culture: the beliefs, values, norms and management style of

the organization
• Organization: the structure, job roles and reporting lines of
the organization
• People: the skill levels, staff potential and management
capability
• Human resources systems: the people focused mechanisms
which deliver the strategy - employee selection,
communications, training, rewards, career development, etc.

Frequently in managing the people element of their business senior managers will
only focus on one or two dimensions and neglect to deal with the others. Typically,
companies reorganize their structures to free managers from bureaucracy and drive
for more entrepreneurial flair but then fail to adjust their training or reward
systems.

There are seven steps to developing a human resource strategy and the active
involvement of senior line managers should be sought throughout the approach
Steps in developing HRM strategy

Step 1: Get the 'big picture'

Understand your business strategy.

Highlight the key driving forces of your business. What are they? e.g. technology,
distribution, competition, the markets.

• What are the implications of the driving forces for the people
side of your business?
• What is the fundamental people contribution to bottom line
business performance?

Step 2: Develop a Mission Statement or Statement of Intent

That relates to the people side of the business.

Do not be put off by negative reactions to the words or references to idealistic

statements - it is the actual process of thinking through the issues in a formal and
explicit manner that is important.

• What do your people contribute?

Step 3: Conduct a SWOT analysis of the organization

Focus on the internal strengths and weaknesses of the people side of the business.

• Consider the current skill and capability issues.

Vigorously research the external business and market environment. High light the
opportunities and threats relating to the people side of the business.

• What impact will/ might they have on business performance?

• Consider skill shortages?
• The impact of new technology on staffing levels?

From this analysis you then need to review the capability of your personnel
department. Complete a SWOT analysis of the department - consider in detail the
department's current areas of operation, the service levels and competences of your
personnel staff.
Step 4: Conduct a detailed human resources analysis

Concentrate on the organization's COPS (culture, organization, people, HR

systems)

• Consider: Where you are now? Where do you want to be?

• What gaps exists between the reality of where you are now
and where you want to be?

Exhaust your analysis of the four dimensions.

Step 5: Determine critical people issues

Go back to the business strategy and examine it against your SWOT and COPS
Analysis

• Identify the critical people issues namely those people issues

that you must address. Those which have a key impact on
the delivery of your business strategy.
• Prioritize the critical people issues. What will happen if you
fail to address them?

Remember you are trying to identify where you should be focusing your efforts
and resources.

Step 6: Develop consequences and solutions

For each critical issue highlight the options for managerial action generate,
elaborate and create - don't go for the obvious. This is an important step as
frequently people jump for the known rather than challenge existing assumptions
about the way things have been done in the past. Think about the consequences of
taking various courses of action.

Consider the mix of HR systems needed to address the issues. Do you need to
improve communications, training or pay?

What are the implications for the business and the personnel function?

Once you have worked through the process it should then be possible to translate
the action plan into broad objectives. These will need to be broken down into the
specialist HR Systems areas of:
 • employee training and development
• management development
• organization development
• performance appraisal
• employee reward
• employee selection and recruitment
• manpower planning
• communication

Develop your action plan around the critical issues. Set targets and dates for the
accomplishment of the key objectives.

Step 7: Implementation and evaluation of the action plans

The ultimate purpose of developing a human resource strategy is to ensure that the
objectives set are mutually supportive so that the reward and payment systems are
integrated with employee training and career development plans.

There is very little value or benefit in training people only to then frustrate them
through a failure to provide ample career and development opportunities

Who Performs HRM Activities

Delegation of HRM duties has changed over time. In most

organizations two Groups perform HRM activities: HR manager-
specialists and operating managers. Operating managers
(supervisors, department heads, vice presidents) are involved in
HRM activities because they are responsible for effective
utilization of all the resources at their disposal. The human
resource is a very special kind of resource. If it is improperly
managed, effectiveness declines more quickly than with other
resources. And in all but the most capital- intensive organizations,
the investment in people has more effect on organizational
effectiveness than resources such as money, materials, and
equipment. Therefore, operating managers spend considerable
time managing people. Just as an operating manager is personally
responsible if a machine breaks down and production drops, he or
she must see to the training, performance, and satisfaction of
employees. Research indicates that a large part of an operating
manager’s day is spent in unscheduled and scheduled meetings,
telephone conversations, and solving problems that have a direct
impact on people. The manager, through constant contact with
many different people, attempts to solve problems, reach
decisions, and prevent future difficulties.
Smaller organizations usually have no HR unit, so the operating
managers have many HRM responsibilities, such as scheduling
work, recruitment and selection, and compensating people. As the
organization increases in size, the operating manager’s work is
divided up, and some of it becomes specialized. HRM is one such
specialized function. Usually the manager of a unit first assigns an
assistant to coordinate certain HRM matters. HR specialists are
employed in organizations with about 100 to 150 employees, and
an HR department is typically created when the number of
employees reaches 200 to 500, depending on the nature of the
organization.
The Interaction of Operating and HR Managers
With two groups of people (operating managers and HR
specialists) making HRM decisions, there can be conflict. Conflict
occurs because operating and HR managers sometimes differ on
who has authority for what decisions, or there may be other
differences between operating and HR managers. They have
different orientations, called line and staff, which have different
objectives. A staff person typically supports the primary functions
such as marketing and production by providing advice, counsel,
and information. The picture of organizational life portrayed by a
textbook assumes that the staff does not wield direct authority
over the line manager. Line managers have the authority to make
final decisions concerning their operations. However, the specific
distinction between line and
staff is not as clear-cut in actual organizations. More often than
not, members of the HR unit have much to say about various
programs and activities. Consider recruitment and selection
practices and the crucial role played by HR specialists. Line
managers are generally not familiar with the legal requirements
concerning recruitment and selection. Therefore, they welcome
the HR experts’ involvement and direct authority in making final
decisions. The conflict between HR employees and operating
managers is most pressing when there must be joint decisions on
such issues as discipline, physical working conditions,
termination,
transfer, promotion, and employment planning. Research
indicates that operating
managers and HR specialists differ on how much authority
employees should have over job design, labor relations,
organizational planning, and certain rewards, such as bonuses
and promotions. In the last decade, sweeping changes in
business, globalization, technology, and demography have
changed not only the role of HRM, but the role of operating
managers as well. Line managers now have greater
responsibilities, managing more people and/or bigger projects

RELATIONSHIP BETWEEN HR STRATEGIES,OBJECTIVES,PLANS AND

POLICIES

HRM Strategy
A firm’s HRM strategy is the pattern or plan that integrates the
major objectives, policies, and procedures into a cohesive whole.
A well-formulated HRM strategy will help aggregate and allocate a
firm’s resources into a unique entity on the basis of its internal
strengths and weaknesses, changes in the environment, and the
anticipated actions of competitors.
The firm strongly believes that training and development of its
employees helps the firm accomplish its strategy accomplishment
indicators—customer satisfaction and sustainable corporate
growth.

Clarifying Meaningful HRM Objectives

The objectives of an organization or department are the goals it
seeks to achieve—its reason for existence. Eight objectives of the
HRM function have already been pointed out, but most of these
objectives were stated in very general terms.
To help the organization achieve these objectives, more specific
statements are developed in larger, most middle-sized, and some
smaller organizations. For example, suppose that one of a number
of HRM objectives is to increase employees’ satisfaction with
opportunities for advancement. How can this objective be
achieved? First, management must measure employees’
satisfaction
with advancement opportunities. Management could design an
attitude survey to
ask employees how satisfied they are with facets of their jobs.
The key issue is to determine the degree of job satisfaction
associated with advancement opportunities. Next, the
organization could use the survey information to develop plans to
correct any deficiencies in satisfaction with advancement
opportunities. These plans are called policies and procedures or
rules.

Exhibit 1-2, which illustrates the relationship between objectives,

policies,
and rules, indicates that objectives are the most general factor.

• Strategy
The plan that integrates major
objectives

• Objectives
Goals that are specific and
measurable

• Policies
Guides to decision making

• Procedures/Rules
Specific directions for decision

HRM Policy

A policy is a general guide that expresses limits within which

action should occur. Policies are developed from past problem
areas or for potential problem areas that management considers
important enough to warrant policy development. Policies free
managers from having to make decisions in areas in which they
have less competence or on matters with which they do not wish
to become involved. Policies ensure some consistency in behavior
and allow managers to concentrate on decisions in which they
have the most experience and knowledge.
After the broadest policies are developed, some organizations
develop procedures and rules. These are more specific plans that
limit the choices of managers and employees, as. Procedures and
rules are developed for the same reasons as policies.

HRM Procedures

A procedure or rule is a specific direction to action. It tells a

manager how to do a particular activity. In large organizations,
procedures are collected and put into manuals, usually called
standard operating procedures (SOPs). Organizations must be
careful to have consistent decision making that flows from a well-
eveloped, but not excessive, set of policies and procedures. Some
organizations, in
effect, eliminate managerial initiative by trying to develop policies
and procedures for everything. Procedures should be developed
only for the most vital areas