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Introduction to Human Resources

1st FEB 2010

Human resource management (HRM)

is the management of
various activities
designed to enhance
the effectiveness of an organisations workforce
in achieving organisational goals.

Human resource management (HRM)

The art of procuring , developing and maintaining

Competent workforce
to achieve the goals of an organization
in an effective and efficient manner

Nature of HRM
1) Pervasive in Nature:
It is present in all enterprises
2) Action Oriented:
RM focuses attention on action, rather than on record
keeping , written procedures or rules.
3) Individually oriented:
HRM tries to help employees to develop their potential fully.
4)People oriented :
HRM is all about people at work , both as individuals and

5) Future-Oriented:
Effective HRM helps an organization to meet its goals in
the future by providing for competent and well motivated
6) Development Oriented:
HRM intends to develop the full potential of employees
7) Integrating mechanism:
HRM tries to build and maintain cordial relations between
people working at various levels in the organization.
8)Continuous function:
HRM is not one shot deal.

9) Comprehensive function:
HRM is concerned with any organizational decision which
has an impact on the workforce or potential workforce.
10) Inter-disciplinary function:
HRM is a multi-disciplinary activity , utilizing knowledge
and inputs drawn from psychology , sociology,
anthropology, economics etc..
11) Auxiliary service:
HR departments exist to assist and advise the line or
operating managers to do their personal work more

As per The Indian Institute of Personnel Management ,
1)Personnel aspect:
This is concerned with manpower planning, recruitment,
selection, promotion, T & D, remuneration, incentives,
productivity etc.

2) Welfare aspect
it deals with working conditions and amenities such as
canteens, housing, transport, medical assistance,
recreation facilities etc.
3) Industrial relations aspect
this covers union-management relations, joint
consultation, collective bargaining , settlement of
disputes, etc

To help the organization reach its goals
To employ the skills and abilities of the workforce
To provide the organization with well-trained and
well-motivated employees
To increase to the fullest the employees job
satisfaction and self-actualization

To develop and maintain a quality of work life

To communicate HR policies to all employees

To be ethically and socially responsive to the needs
of society

Importance of HRM
Good HR practices help:

Attract and retain talent

Train people for challenging roles
Develop skills and competencies
Promote team spirit
Develop loyalty and commitment
Increase productivity and profits
Improve job satisfaction
Enhance standard of living
Generate employment opportunities

Functions of HRM

Systems Approach to HRM

Evolution of the Concept of HRM

The commodity concept :
Labor considered as a commodity to bought and sold.
Government did very little to protect workers.

The Factor of Production Concept :

Labor is like any other factor of production.
Workers are like machine tools.
The Goodwill Concept :
Welfare measures will have a positive impact on


The Paternalistic Concept :

Fatherly and Protective Attitude towards employees.
The Humanitarian Concept :
To improve productivity , physical , social and
psychological needs of workers must be met.
Hawthorne Experiment
The Human Resource concept:
Employees are the most valuable assets of an organization.
The Emerging concept:
Employees should be accepted as partners in the progress of
a company. The focus should be on Human Resource

Growth in India

Early Phase:
Kautilya , in India (in his book Arthasastra) made
reference to various concepts like job analysis ,
selection procedures, executive development ,
incentive system and performance appraisal.

Dwivedi describes the development of HRM in

five stages:
a) Welfare Stage
(before 1947)
b) Industrial Relations Stage
c) Personnel Administration Stage (1970s)
d) Personnel Management Stage (1980s)
e) HRM stage
(1990 onwards)


Welfare Stage

(before 1947)

Subhuman condition during the early British period:

The Plantation Act of 1863 provided that if the workers
failed to complete their period of contract , they should be
imprisoned for a period not exceeding 3 months.
the workers were entirely helpless in the face of the
organized and powerful European planters.

Factory ACT, 1881:

a weekly off-day.
working hour for women workers limited to 11.
minimum age for employment should be 7 and
working hours should not exceed 7 hrs a day.

Emergence of Trade Unions:

In 1890 , the first labor organization BOMBAY MILL
HANDS ASSOCIATION was established.

First Welfare Officers and other Developments:

In 1923 , for the first men in the organized sector ,
TATA steel appointed K. A. Naoroji as a labour or
welfare officer to look after labour issues in the
various departments of the steel works
The Royal commission on labor in 1931 suggested
the appointment of LABOUR OFFICER to protect
workers interests and act as a spokesperson of labour

B) Industrial Relations Stag (1947-1960s)

Legal enactment:
The Industrial Disputes ACT,1947, the welfare officers
were made responsible for handling disputes and
adjudication pertaining to the conditions of service
including wages , leaves , retirement benefits and
Employment Exchanges Act,1959.
The Apprentices Act ,1961
(to regulate recruitment
and training of workers)

Demarcating Welfare and Personnel Officers

21st session of the Standing Labour Conference ,
held in DEC 1963.
The welfare manager officers are not
responsible for dealing with disciplinary cases
against workers or appear in court on behalf of
the management against the workers in labour
dispute cases.

C) Personnel Administration Stage (1970s)

1) Labour welfare Welfare Officer
(after industrialization )
2) Industrial Relation Labour Officer
(emergence of trade union)
3) Personnel Administration Personnel Officer
(the development of scientific management
of industry)
In the early 80s , the area of labour welfare largely
merged with personnel administration. These two
areas , combined together , are referred to as

d) Personnel Management Stage


A Specialized Profession
In the 1980s management of human resources was
regarded as a specialized profession such as that of
medicine and law.
Three categories of activities.
a) line activities: he was responsible for the
management of a department.
b) technical activities: he was responsible for
industrial relations activities including contract
negotiations, grievance handling , preparation and
presentation of arbitration cases and research in
labour relations.
c) advisory role

Roles and Responsibilities of HR managers

Roles :
As per Armstrong
a) reactive/proactive roles
b) business partner roles
c) strategists roles
d) interventionists role
e) innovation roles
f) internal consultancy role
g) monitoring role

a) Reactive roles
HR mangers tend to do what they are asked to do.
Proactive roles
at strategic level , they act as internal consultants
and provide guidance on issues relating to
upholding core values.
b) business partner roles
- they integrate their activities with top management
and identify business opportunities.
- they facilitate attainment of firms business

c) strategists roles
they deal with basic long-term issues relating to the
development of people and the employment
d) interventionists role
the HR managers are expected to observe and analyze
the happenings in their organizations.
e) innovation roles
attempt may be made to introduce innovative
processes and procedures which can enhance
organizational performance.

f) internal consultancy role

the HR managers work as internal management
consultants to analyze problems, diagnose issues and
suggest solutions.
g) monitoring role
HR managers are required to ensure that the
procedures and policies are implemented consistently.
HR managers work as regulators.

ARMSTRONG classifies responsibilities (activities) of HR
managers in three general categories:


Service Provision
providing services to internal customers (management , line
managers, team leaders and employees) in varied HR related
areas (HR planning, recruitment and selection, etc)

b) Advice
advice on varied issues such as job design , health and
safety requirements, etc.
perform the responsibilities of counselors and mentors as well
as problem solvers by providing advice to
individuals, team
leaders and managers.

The HR managers provide guidance to the management on HR
policies , procedures and the implication of labour legislation.
They make recommendations on HR strategies.
They may also provide guidance to ensure that consistent
decisions are made on varied issues such as pay increases,
performance apprasial , etc

French* classifies specific responsibilities of HR

managers in large organisations under six categories.
These responsibilities related to:
a) Vice President (HR)
b) Director (recruitment and employment)
c) Director (compensation and benefits)
d) Director (labour relations)
e) Director (training and development)
f) Director (employee relations)
*French .w., human resources management

Responsibilities of the Vice President (HR)

tasks related to the executive committee, organisation planning ,
HR planning , policy and organisational development.

Responsibilities of the Director (recruitment & employment)

Recruiting , interviewing , testing, placement and termination.

Responsibilities of the Director (compensation and benefits)

job analyzes, services, performance apprasial , compensation
administration, giving bonus and profit sharing plans and
taking care of employee benefits.

Responsibilities of the Director (labour relation)

Negotiations, contract administration, grievance redressal
procedures, arbitration, health and safety, medical plans
and cafeteria.

Responsibilities of the Director (T & D)

orientation, training , management development, career
planning and development, quality circles and exit

Responsibilities of the Director (Employee Relations)

Equal employment opportunity relations, control
compliance, social assistance programmes, employee
counseling etc

Human resources are unique in character

HR alone can produce an output greater than its input

is are
is the
only resource

HR is most complex and unpredictable in its behavior

This is the only resource which appreciates in its value

with the passage of time.

Qualities of a HR manager
Today the industrial atmosphere is in a complex situation due to
many reasons, like,
Employee-employer relation
High Attrition
cross broader culture etc
A number of tasks (functions) are entrusted with him.

1.Sense of social responsibility

hr manager must always conscious to attain the co
operation of the employees to meet the needs of the

2.Leadership and organisational skills

He should be able to motivate employees to attain
organisational goals.
He has to advise the line management (behavioural
problem while deciding policies related with employees)
He should have the capacity to face workers and
management and to speak without fear.

3. Ability to deal with people :

HR is most complex and unpredictable in its behavior.
He should be able to understand them properly.

4.Personnel integrity:
He can be trusted by all in the organisation.

5.Tact and resourcefulness:

he must be able to deal difficult situations tactfully.
He should have open mind , objectivity and
adjustability to tackle a difficult situation.

6. Inner Urge
he must have a faith in humanity and have a sense of
inner urge to solve the problems.

7. Free from Bias

he should not act as a representative of either
management or employees, but try to be a professional

8. Communication skills
communicating to different levels of employees.

9) Consideration
several demands are unreasonable , he should hear it

10) Personality Traits


Fluency in speech
Facial expression (smile)
Personnel dignity
Professional knowledge (administrative & technical)
Knowledge of labour and other terms

Future of HRM

Size of workforce
have grown in size considerably
additional challenges b4 HR : Demand for better pay , benefits and working


Composition of workforce
women and minorities in the work force
demand for equal pay for equal work
culturally diversified groups


Employee expectation
financial and non financial demands
employee turnover ratios are rising


Changes in technology
employees should update their knowledge and skills constantly


Life-style changes
ready to change jobs, shift to new locations , take up jobs in start up
companies instead of manufacturing units and even experiment with
untested ideas
flexible working hours , attractive compensation packages, job content
and growth opportunities etc. may occupy the centre-stage in hr
strategies of Indian managers in the days ahead.


Environmental challenges

7)Personnel function in future

job redesign
career opportunities
recruitment and selection
training and development
Safety and welfare

8. Changes in 21st century impacting HRM

hr as a spacing board for success
talent hunting, developing and retaining:
Clear focus areas
lean and mean organizations
labour relations
health care benefits