MIIS-301[HRM]
Chapter-01
Introduction to Human Resource Management
What Is Human Resource Management?
Human resource management (HRM) is the process of acquiring, training,
appraising, and compensating employees, and of attending to their labor relations,
health and safety, and fairness concerns.
An organization consists of people with formally assigned roles who work together to achieve the
organization’s goals. A manager is someone who is responsible for accomplishing the organization’s
goals, and who does so by managing the efforts of the organization’s people. Managing involves
performing five basic functions: planning, organizing, staffing, leading, and controlling. In total, these
functions represent the management process.
Human Resource Management (HRM) is all about how managers work with the people in their
organization. Imagine a company like Upwork. It has employees with specific jobs who work together
to achieve the company's goals. A manager is in charge of making sure these goals are met by managing
the employees.
Managers have five main tasks:
1. Planning: This means setting goals and making plans for how to reach them.
2. Organizing: It's about giving each employee a specific job, creating departments, and making
sure everyone knows who's in charge.
3. Staffing: This involves deciding what kind of people to hire, finding and choosing employees,
setting expectations, paying them, and evaluating their work.
4. Leading: Managers need to motivate and guide their employees to get the job done and keep
morale high.
5. Controlling: They also need to set standards like sales targets or quality levels, check how well
things are going, and fix any problems.
In this book, we focus on one of these tasks: staffing or human resource management. HRM is about
getting, training, evaluating, and paying employees, as well as addressing their concerns about work
conditions and fairness.
Here are some things covered in the book that every manager should know about HRM:
•
Analyzing jobs to understand what each employee does.
•
Planning how many people are needed and finding candidates for jobs.
•
Selecting the right people for the jobs.
•
Helping new employees get started.
•
Managing pay and benefits.
•
Evaluating how well employees are doing.
•
Communicating with employees, including interviews, counseling, and discipline.
1
•
Training employees and developing future managers.
•
Building good relationships with employees.
Managers also need to be aware of:
•
Equal opportunity and affirmative action, which ensure fairness in hiring and promotions.
•
Employee health and safety to keep the workplace safe.
•
Dealing with employee complaints and handling labor relations.
Why Is Human Resource Management Important to All Managers?
1. Avoiding Mistakes: HRM knowledge helps managers avoid certain mistakes when handling
employees. These mistakes include not getting the best work from employees, hiring the wrong
people, high employee turnover, facing legal issues due to discrimination, workplace accidents,
insufficient training, or unfair labor practices. Learning HRM can help prevent these problems.
2. Improving Results: Good HRM practices ensure that managers get good results through their
employees. Even if a manager has excellent plans and strategies, they can fail if they don't hire the
right people or motivate their team. Successful managers know how to hire the right people and
make sure they perform well.
3. Importance of the Workforce: The text emphasizes that having a skilled and motivated workforce
is crucial for a company's success. It states that having money isn't the main challenge; it's having
the right people to work efficiently. In today's competitive world, this is more important than ever.
4. Examples of Improvement: The text provides two examples of how good HRM practices can lead
to improved performance. In one case, a packaging plant increased production and reduced
complaints by setting performance goals and improving employee skills. In another, reducing
turnover in a call center saved a company a significant amount of money.
5. Possibility of Being an HR Manager: The text also suggests that managers may spend some of
their career as human resource managers, especially in large companies. This experience can be
valuable for understanding how to develop leaders and deal with the human side of a company's
transformation.
6. HR for Small Businesses: For small business owners and managers, HRM knowledge is important
because they often don't have dedicated HR departments. They handle HR tasks themselves, so
understanding HRM techniques can help them manage their workforce effectively.
Line and Staff Aspects of Human Resource Management
Authority: The right to make decisions, direct others' work, and give orders.
line authority: Traditionally gives managers the right to issue orders to other managers or employees.
Staff authority: Gives a manager the right to advise other managers or employees.
line manager: A manager who is authorized to direct the work of subordinates and is responsible for
accomplishing the organization's tasks.
Staff manager: A manager who assists and advises line managers.
In a company, all managers have some responsibilities related to their employees, like hiring and
training. But there's also a separate human resource department led by its own manager. This text talks
about how the human resource manager's role is different from other managers and how they fit into
the organization.
2
There are two types of authority in a company: line and staff authority. Line authority is when managers
can give orders to other managers or employees, creating a boss-subordinate relationship. For example,
when the vice president of sales tells the sales director to prepare a presentation, that's line authority.
Staff authority is when a manager can give advice to others. It's more of an advisory role. For instance,
when the human resource manager suggests a particular test to the plant manager, that's staff authority.
On the company's chart, managers with line authority are called line managers. They typically manage
departments that are crucial for the company, like sales or production. Managers with staff authority are
staff managers. They oversee departments that provide advice and support, like purchasing and human
resource management. Human resource managers are usually staff managers. They help and advise line
managers with things like hiring and pay.
Line Managers’ Human Resource Management Responsibilities
Line managers have a lot of responsibilities when it comes to dealing with the people who work for
their company. These responsibilities include:
1. Making sure the right person is in the right job.
2. Helping new employees get settled in the company (orientation).
3. Teaching employees how to do their jobs when they are new to them.
4. Helping each person do their job better.
5. Encouraging teamwork and good relationships among employees.
6. Explaining the company's rules and ways of doing things.
7. Keeping an eye on how much money is spent on labor (employee) costs.
8. Helping each person improve their skills.
9. Creating a positive and happy atmosphere in their department.
10. Making sure employees are safe and healthy.
These responsibilities are becoming even more important with the use of social media tools like
LinkedIn for hiring. In a recent survey, 49% of employers were trying to make sure that line managers
are good at managing people.
The Human Resource Department
In small companies, regular managers do all the employee-related work by themselves. But when a
company gets bigger, these managers often need help and advice from a special team called the
Human Resource Department. This department has people who are experts in things like hiring,
training, and dealing with workplace issues.
In larger companies, this Human Resource Department helps with various jobs. Some examples of these
jobs are:
•
Recruiters: They find good job candidates using different ways like talking to people in the
community or advertising jobs online.
•
Equal employment opportunity (EEO) representatives or affirmative action coordinators: They
handle complaints about fairness at work and make sure the company follows the rules about
treating everyone equally.
•
Job analysts: They study and write down all the details about what each job in the company
involves.
3
•
Compensation managers: They decide how much money employees get paid and manage the
company's benefits like health insurance.
•
Training specialists: They plan and organize training for employees to learn new skills.
•
Labor relations specialists: They help the company and its employees work together well,
especially when there are unions involved.
In real life, both the Human Resource Department and regular managers work together to take care of
employees. For example, a regular manager might say what kind of training a new worker needs, the
Human Resource Department can create the training, and the manager can then provide training while
the person is working.
NEW APPROACHES TO ORGANIZING HR:
The way companies handle their HR (Human Resources) is changing. Many companies are rethinking
how they organize their HR functions.
First, they are changing how they provide HR services. Some are using new technology tools like online
training websites. Others are creating central HR teams that help different departments with HR matters
through the company's internal network or phone service.
In some companies, there are special HR teams. Some help top management with big-picture HR issues.
Others are assigned to specific departments like sales or production to assist with employee-related
tasks.
There are also HR consulting teams within companies. These teams offer specialized advice on things
like changing the organization structure to different parts of the company.
The Trends Shaping Human Resource Management
Different things affecting how companies manage their employees:
1. Workforce Demographics and Diversity Trends: It means that the kinds of people working in
companies are changing. There are more women, minority group members, and older workers in
the workforce. Also, the number of younger workers is going down, and there aren't enough of them
to replace older workers who are retiring. So, some companies are hiring workers from other
countries.
2. Trends in Jobs People Do: There are three big changes in the kinds of jobs people do. First, more
people are working in service jobs instead of making things. Second, some people are not traditional
employees but work as freelancers or independent contractors, often using apps like Uber. Lastly,
even jobs that used to be simple are now becoming more high-tech, so workers need more technical
skills.
3. Globalization Trends: This means that companies are doing business in other countries. For
example, a company might make products in one country and sell them in another. This has been
happening a lot, but it also brings more competition and can lead to companies moving some of
their operations to other countries to save money.
4. Economic Trends: The text talks about how the economy has been up and down, with good times
and bad times. For example, there was a time when many people were buying houses, but then the
economy got worse, and some people lost their jobs. Now, things are getting better, but there are
still some challenges.
5. Labor Force Trends: The labor force is the group of people who can work. It's growing more
slowly, which can be a problem for companies because they might not be able to find enough
4
workers. Also, not all jobs require a college education, and sometimes people end up in jobs that
don't match their skills.
6. Technology Trends: Technology is changing how companies manage their employees. For
example, some companies use social media to find new workers, and they use mobile apps and
artificial intelligence to do HR tasks. This can make things more efficient, but it also means that
HR managers need to learn how to use these technologies.
Important Components of Today’s New Human:
Important aspects of managing people in modern times.
1. Resource Management: Long ago, even in ancient times and during the Industrial Revolution,
managing workers was necessary. However, it was typically a part of every manager's job.
Then, as factories grew, employers started setting up offices to manage employee-related tasks.
By 1900, they had established hiring offices and training programs. This marked the beginning
of personnel management.
2. Distributed HR: Nowadays, thanks to technology like social media, HR tasks are being given
to employees and managers in various parts of the company. For example, some employees use
a digital tool to provide feedback on each other's work, which is then used for performance
evaluations. This shift is somewhat similar to the time before dedicated HR departments existed
when managers handled many personnel tasks.
3. Strategic HR: HR is now involved in long-term strategic planning for companies. This means
that HR policies and practices are designed to help the company achieve its big-picture goals.
For example, HR helps determine what skills and behaviors employees need to meet these goals
and then designs policies to develop those skills.
4. Performance Improvement: HR is responsible for improving employee performance through
various means. They ensure HR departments run efficiently, advise top management on staffing
and compensation, and put in place policies that help employees gain the skills the company
needs.
5. Evidence-Based Management: Companies are increasingly using data and research to make
HR decisions. They want to know what really works and use this information to shape HR
practices and policies.
6. Adding Value: HR is expected to contribute to the company's success, not just by cutting costs,
but also by improving processes, aligning HR with company strategy, and fostering employee
engagement.
7. Sustainability: Businesses are being judged not only on profits but also on their environmental
and social impact. Some companies are striving to achieve financial success while also making
a positive contribution to society and the environment.
8. Employee Engagement: Engaged employees are those who are committed to their work and
perform better. HR is tasked with finding ways to improve employee engagement because it
directly affects a company's performance and revenue.
9. Ethics: Ethics refers to the standards that guide behavior. HR plays a significant role in
maintaining ethical behavior within organizations, as many ethical issues are related to HR,
such as workplace safety.
5
In summary, managing people in today's world involves not only traditional HR tasks but also strategic
planning, data-driven decisions, and a focus on ethics and sustainability. Companies want their HR
departments to add value by fostering employee engagement and contributing to their overall success.
The New Human Resource Manager:
Being a human resource manager today is more complicated. It's not just about hiring and training
people anymore. HR managers need to do more, like making plans based on numbers and figures,
understanding how the company works, and even changing how the company is organized.
To be a good HR manager today, you need certain skills and knowledge. The Society for Human
Resource Management (SHRM) lists them:
1. Leadership and Navigation: You should be able to guide and contribute to the company's
plans.
2. Ethical Practice: You must follow strong values and integrity in everything you do.
3. Business Acumen: Understand how the company works and help with its big plans.
4. Relationship Management: Handle interactions with others well.
5. Consultation: Give advice to people in the company.
6. Critical Evaluation: Make smart decisions based on information.
7. Global and Cultural Effectiveness: Respect and consider everyone's different backgrounds.
8. Communication: Share information effectively with others.
You should also know the basics of HR areas like hiring people, keeping them happy, and dealing with
issues.
Many HR managers get certified to show they know all this stuff. There are two main certification
options: HRCI and SHRM.
Lastly, your personal philosophy about how to manage people is important. It's based on what you
believe about people and how they should be treated. This philosophy can change over time based on
your experiences and what the company thinks. Some companies, like Google and SAS, have good
philosophies that make employees happy and successful.
HR Manager Certification:
Human resource managers often get certified to show they know a lot about managing people at work.
There are two ways they can become certified.
One way is through a group called the HR Certification Institute (HRCI). They give out different
certificates like "Professional in Human Resources" (PHR) and "Senior Professional in Human
Resources" (SPHR). To get certified by them, managers have to take a test. You can practice for the test
online on their website.
Another group called SHRM also has certification exams for human resource managers. They offer
certificates like "SHRM Certified Professional" and "SHRM Senior Certified Professional." Their test
is based on what they call the "SHRM Body of Competency and Knowledge," which is about knowing
how to do the job well. If you want to see what topics the tests cover, you can look in the back of the
book for a list.
6
Throughout the book, you'll see special icons that tell you when it's talking about the stuff you need to
know for these certifications.
HR and the Manager’s Human Resource Philosophy:
Companies and managers think about and treat their employees. While being good at the job is
important, how people act at work is influenced by the beliefs managers have about them. These beliefs
include things like whether employees can be trusted if they like their work, why they behave the way
they do, and how they should be treated. These beliefs form a manager's philosophy of managing people,
and it affects every decision they make regarding employees, such as who to hire, how to train them,
and their leadership style.
Developing this philosophy is influenced by a manager's personal experiences, education, values, and
background. However, it can change over time as managers learn more and gain more experience. For
example, if there's a problem with workers being unhappy, a company might change its philosophy to
make employees happier.
A company's top management also plays a big role in shaping this philosophy. Even if they don't say it
directly, their actions show what they believe about managing people, and this philosophy affects every
level and department in the company.
For example, companies like Polaroid, SAS, and Google, have positive philosophies about how they
treat employees. They believe in trust, innovation, personal growth, and making work a rewarding part
of employees' lives. Such companies tend to be seen as good places to work, and this helps them
succeed.
7