Introduction to HRM
Introduction to HRM
 People are vital for effective operation of an
organization. It is people, not buildings that make a
company successful.
 Assets make things possible but people make things
 Employees play dual role. First, as a factor of
production. And second, it makes other factors
operative and productive.
 People are the most valuable asset of an
organization. Yet human assets are virtually never
shown on the balance sheet.
Nature of People
Characteristics of HR
Multiplicity of roles assumed by individuals. A person
play many different roles in the society. These roles are
conflicting in nature.
There is no average person. Two persons are not the
same. This is called individual differences. People are
People are dignified. Treat them with respect and dignity.
People appreciate as time goes on. People gain more
knowledge and experience.
Nature of People
 Human being should be considered as a whole
person. Human is a total person influenced by
internal and external factors. His working life is
affected by social and family life.
 People have synergetic ability. The whole is greater
than total of its parts. It may be positive or
negative. Two plus two can be five or three.
 People can be motivated. Motivation is the
willingness to exert more efforts to achieve
organizational goal.
 People have a desire for involvement. They want to
participate in decision making, which affect their
interests. They have right to express their views,
emotions and sentiments.
Nature of People
• People have perceptual differences. Perception is a
process through which people interpret and give
meaning to an event or environment.
People may perceive the same thing differently. A lot of
problems may arise because of perceptual differences.
These are• Self-serving bias: Attribute own success to internal
factors and failure to the external factors.
• Selective Perception: People selectively interpret what
they see on the basis of their interest, backgrounds and
Nature of People
 Halo Effect: Drawing a general impression about a
person on the basis of a single characteristic.
 Contrast effect: Evaluation of a person’s
characteristics that are affected by comparison with
other people recently encountered who rank higher or
lower on the same characteristics.
 Projection: Attributing one’s characteristics to other
 Stereotyping: Judging a person on the basis of one’s
perception of the group to which that person belongs.
Generalization of characteristics of people on the basis
of gender, age, religion, color, race or wealth.
Competitive Advantage through
• Productivity can be achieved through people.
• People provide organization with the source of
competitive advantage.
• People are becoming a great differentiating factor.
Selection of people who are smarter, better trained,
more motivated, and more committed will help to
achieve competitive advantage.
• Gaining competitive advantage through people
requires following guidelines:
– Employment security
– Selectivity in recruiting
Competitive Advantage through
High wages and salaries
Incentive pay
Employee ownership
Employee empowerment and participation
Information sharing
Training and skills
Treat people with respect and dignity
Promotion from within.
Meaning of Management
• Management is knowing exactly what you want men to
do and then seeing that they do it in the best and
cheapest way.
• Management is the process of achieving organizational
objectives through engaging in five major functions of
Planning, Organizing, Staffing, Leading and
• The application of planning, organizing, staffing,
directing, and controlling functions in the most efficient
manner possible to accomplish objectives is known as
Meaning of Management
• Planning: Planning is the projected course of action. It
is deciding in advance what is to be done in future.
Planning is the design for tomorrow’s action.
• Organizing: It is the process of arranging and
allocating resources necessary to achieve organizational
objectives. Here resources means both human and nonhuman resources.
• Staffing: The management function of selecting,
placing, training, developing and compensating
Meaning of Management
• Leading: Leading is the process of influencing people to
have desired behavior necessary to achieve
organizational objectives. It is the process of influencing
the activities of an individual or group toward
accomplishing objectives.
• Controlling: It is regulatory function. Controlling
ensures that activities are running to the plans made. It
is the management functions of checking to determine
whether employees are following plans and progress is
being made, and taking action to reduce discrepancies.
Definition of HRM
• Management is getting things done through other
• Management is nothing but managing people at work.
• HRM is a field of management involves planning,
organizing, directing, and controlling the functions of
procuring, developing, maintaining and motivating a
labour force.
• It is a process of acquiring, training, appraising,
developing and compensating employees, and attending
to their labour relations, health and safety and fairness
Functions of HRM
Training and Development
Acquisition function
• It deals with human resource planning.
• HR planning is a process through which an
organization ensures that it has right types and kinds
of people at the right place who are capable of doing
their assigned tasks.
• Acquisition function includes- recruitment, selection
and socialization of employees.
• Recruitment is a process of finding and attracting
qualified people for job. It is a positive approach
because its objective is to encourage
Acquisition function
more people to apply for jobs.
• Selection is a process of hiring suitable people for
job. Right person for right job is the main goal of
selection. It is a negative approach.
• Socialization is a process of getting new employees
acquainted with the organization, its culture, rules
and regulations, objectives and supervisors and
other employees.
Training and Development
• Employees skills should be developed and they must have up
to date knowledge and skills.
• It encompasses employee training, education and career
• Ongoing retraining is necessary to accommodate
technological changes. It is a process of acquiring new skills to
do job properly. Training changes employees attitudes and
• Development of employee is necessary to prepare
organizations for future challenges.
• Another function of HRM is to help employees to exert high
energy level.
• Motivation function begins with the recognition that
individuals are unique and the motivational techniques such
as job satisfaction, employee performance appraisal and
compensation must reflect the needs of each individual.
• Assessing how employees perform their jobs is the focus of
performance appraisal.
• Compensation rewards people for performing organizational
work through pay, incentives and benefits.
• Function of HRM is to maintain employee
commitment and loyalty to the organization.
Qualities of HR manager
• Personal Attributes:
– Initiatives
– Depth of perception
– Mature judgment
– Understanding of human behavior.
• Experience and Training:
– Experience in psychological aspects
– Labour laws
– HR management and general management
Qualities of HR manager
• Professional Attitude:
– HR manager must have professional attitude
– He must have the acquisition of basic knowledge
of the subject and the right mental attitude.
Principles of HRM
Treat people with respect and dignity
Treat people as adults
Deal with people as complete individuals
Treat all employees with justice
Provide people with opportunities for growth and
Make people feel that they are important
Rewards should be earned, not given.
Do not underestimate the potentials of people.
Supply people with all relevant information.
Philosophy of HRM
• Labour is viewed as a technical factor of production.
They are treated as commodity and they can be
bought and sold. They are hired and fired at will. It is
consistent with theory X.
• Labour is viewed as human factor with a lot of
positive potentials, so they must be treated with
respect and dignity. This is consistent with Theory Y
or McGregor.