Class Session 2 --- Principles & Policies
Outline
Line and Staff relationships
Difference between Policies & Principles
Policies--- Should we adopt them ???Benefits / Aims / Objectives of
Personnel Policies
Personnel Department--- Its Organization -Responsibilities & Place
in the Organization
Guidelines to formulate Policies ,Types of Policies, Matters to be
included in Policy Formulation
Line & Staff Relationships in Organizations
Relationship which the managers in an organization deal
with one another are classified into two categories
Line and staff
Line Relationship - authority and responsibility
Receiving and giving instructions or orders.
Important as one gets work done through people.
Staff Relationship –giving and taking of advice
Line Staff Relationships in Orgn
General Mgr
Yellow – Staff
Relationship
Black – Line Relationship
Mkt Mgr
Dy
Mgr
Officer
Officer
Fin Mgr
Dy
Mgr
Prod.M
gr
Dy
Mgr
Officer
Officer
Sales
Asst
HR Mgr
Dy
Mgr
Officer
Asst
Asst
Organization of Personnel Department
1. Its concerned with the relationships of management to
employees
2. Its concerned with the relationships of employees to employees
in all matter
3. Personnel department is staff department and has a structure
of line type
4. Organization of personnel function depends on the size,
structure, range and depth of actions, needs, capacities, nature
and location of organization.
5. The degree to which the organization takes personnel function
seriously
• Scale of operations large – a separate department is essential
Organizational Structure Personnel Department
Organizational Structure Personnel
Department
Personnel Department
Personnel Department
Eg- Hospitals
Personnel Department
Eg-FMCG Colgate Palmolive
Levels of Management
3
HR Dept
Vice President HR
3 Managers ( Functional
& General
Employees
Personnel Department
-g- Pharma cos Merck
Organization Structure
Levels of Management 3
HR Dept Structure
Vice President
HR
Sr. Executive HR
Executive HR
Responsibility of Personnel Specialist
Human
Resource Planning
Formulation of Programmes & Procedures
Employee Health & Safety Programmes
Training and Development of Personnel
Wage & Salary Administration
Good Labour Management Relations – Grievance handling
Employee Benefit Programmes
Personnel Research
Personnel Audit & Review Work
Airport Authority of India
Functions of Personnel Department
Formulating policies & procedure
Manpower Planning
Training & Development
Recruitment & Promotion
Service Condition
Wage & Salary Administration
PAS & Counseling
Formulation of various welfare schemes
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Functional Chart of AAI
Chairman
Dep't under Board
Members OPS
Corporate
HQ
Finance
Per &A
Finance & A/cs
Commercial
Internal Audit
Land Mgmt
Consultancy
Secretary
Planning
Corporate
HQ
Public Relations
Regional HQ
Projects
Airports
Vigilance
Personnel Department
Indian Oil Corporation
Executive Dir HR
GM HR
DGM
HRD
T&D
HR/Personnel Dept Shoppers Stop
VP HR
Corporate Mgr
HR
Training
Manager
Asst Mgr
Training Analyst
Officer HR
Mastek A mix of functional & Matrix
Organization
3 Center Heads
Corporate HR Manger
Mastek Development Cell
Personnel
Mgmt
OD
Training
Career Path
Oberoi Hotels
Sr.VP HR
Director HR
Training
Human Resource
Summary
HRM is a tool that helps managers to plan, recruit, select,
train, develop, remunerate, motivate and make maximum
utilization of human and non human resources for the
organization and society at large.
“One machine can do the work of fifty
ordinary men. No machine can do the work
of one extraordinary man.”- Elbert Hubbard
Principles

Principles are fundamental truths related to
management of Human Resource established by
research, investigation and analysis, generally
applicable to all organizations.

Henri Fayols’s 14 Principles of Management
Division of Work, Authority, Discipline ,Unity of
Command, Unity of direction, Centralization
Order, Equity, Espirit De Corps ,Stability of
Personnel , Initiative , Remuneration, Individual
interest
Some Personnel Principles:
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Principle of individual development
Principle of free flow of communication
Principle of participation
Principle of fair remuneration
Principle of incentive
Principle of scientific selection – right person
Principle of Team spirit
Some Personnel Principles
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Principle of lean enterprise –create product or
service that has value to customer is of perfect
quality & delivery on time
Eg – Dabbawalla’s -Their Principles..
Work is Worship
Manav seva me bhagwan seva milti hai
Unity is strength
Principle of poka –yoke – which means error
proofing processes
Personnel Policies

Personnel policies are statements of personal
objectives of an organization and provide a
broad framework within which decisions on
personal matters can be made without
reference to higher authorities.

They lay down the criteria for decision
making in the field of personnel management.
Purpose of Principles

Principles act as a guide to the managers in
formulating policies, programmes,
procedures and practices.

They help in solving various personnel
problems
Difference --Policies & Principles
Policies
Principles
A PLAN of Action
A fundamental truth established by
research, investigation and analysis
A statement of intention , more
Many principles have been established
specific, and commits the management by practice, experience , and
to a definite course of action
observation
It does not spell out a detailed
procedure
Are facts which cannot be altered
A well drafted policy should be
flexible and broad enough for it to be
applicable to varying situations
They come handy in solving many
vexing problems since they are
universally true.
Difference --Policies & Principles
Policies
It is a guide for managerial
decisions and actions
Vary from organization to
organization
Policies must be stable.
Policies must reflect goals &
values of the organization
existing.
Principles
A guide for managers in
formulating
policies,programmes,procedur
es and practices
Applicable to all
organizations since they are
universally true.
Are facts so they would
remain facts only
Principles do not reflect goals
and values of the organization
Policies
Principles
Some egs. –
Policy of hiring people
Policy on terms and conditions of
employment- layoffs, strikes,
remuneration hours of work,
promotion, housing, uniform,
medical assistance etc
Some egs –
Reuters Values Employee
Diversity
Building on our longstanding
principles of integrity and
freedom from bias, we value
diversity.
Eg ---Privacy Policy of TCS
Recruitment Policy of TCS is an equal-opportunity employer
Personnel policy of ABB India – states that each employee would understand his
role, take responsibility, and develop him according to the changing needs of job
profile and organization.
Should Organizations
Adopt Policies ??
Benefits / Aims / Objectives of Personnel Policies
Basic needs of both organization and employees taken care of.
Consistent treatment to all the employees
Stability & Security of work environment
Standard of Performance
Builds employee loyalty and motivation
Resolves Conflicts -- intrapersonal and interpersonal
Guidelines to formulate Policies
Sources for determining the content and meaning of policies
Past Practice in the organization
Prevailing
practice in rival companies
Attitudes
and philosophy of founders of the company, directors
and top management
Attitudes
and philosophy of middle and lower management
Knowledge
and experience gained from handling countless
personnel problems on day-to-day basis
Policy Formulation is an essential pre-requisite for manpower
planning.
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Identifying the need – The areas where policy has to be
formulated identified. Need for a new policy, revision, or an
existing policy is voiced by the staff and members of organization
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Gathering Information – thru past & prevailing in industry ,
knowledge and experienced gained from handling problems on
day-to-day basis.
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Examining Policy Alternatives- involving people who use the
policy and live with the policies

Getting Approval – from the top management at right time.
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Communicating the Policy - to staff through journals, in house
magazines, circulars, meeting, educational programmes etc
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Evaluating the policy – after the policy is framed it should be
evaluated after a certain time period
Types of Policies
Jucius has identified 2 types
Functional or Organizational – policies which are grouped for
different categories of personnel
eg- for the mgmt dealing with planning, organizing & controlling etc.
Centralized – are planned for companies with several locations and are
formulated at the Head Office
Major Policy – pertain to overall objectives, procedures and control
which affect an organization as a whole. They are formulated by the
Board of Directors and framework is established within which major
executives for the remaining policies necessary to carry out the major
objectives of an organization.
Minor Policy- cover relationships in a segment of and organization with
considerable emphasis on details and procedures.
Types of Personnel Policies
Originated Policies – established formally by top
management
 Appealed Policies – formulated on requests of subordinates
who want to know handle some situations.
 Imposed Policies – An organization accepts these policies
due to external agencies like govt.,trade association .
Eg- Not to accept any one below the age of 14 according to
the factories act.
 General Policies – These policies do not relate to specific
issues in particular
 Specific Policies – Policies relating to specific issue like
staffing compensation , collective bargaining etc
 Written or Implicit Policies – are inferred from behavior
of managers.
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Coverage of Policies
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In most companies, policies are established
regarding various functions of personnel
management which are as follows:-
Coverage of Policies
1)Employment:Employment policies should provide
clear guidelines on the following points:
a) Minimum hiring qualifications.
b) Preferred sources of recruitment
c) Reservation of seats for Sc St, handicapped
persons and ex-servicemen.
d) Probation period
e) Lay off and rehiring
Eg – Minimum qualification for cabin crew is HSC
Eg – Banks have reservation systems for employees
Eg – BMC , Police departments , Armed Forces
Coverage of Policies
2) Training and Development
a) Attitude towards training
b) Objectives of training
c) Basis of training
d) Methods of training
e) Programmes for executive development
f) Orientation of new employees
Eg- Armed Forces, Police Department, Fire
Departments, Disaster Management Dept
Coverage of Policies
3) Transfers and Promotions
a) Rationale for transfer
b) Seniority required for promotion
c) Relative weightage of seniority and merit in
promotion
 Eg- Police constables are transferred to
urban cities if they belong to some interiors of
Maharashtra
Coverage of Policies
4. Compensation
a) Job evaluation system
b) Minimum wages and salaries
c) Method of wage payment
d) Profit sharing and incentive plans
e) Non monetary rewards
Coverage of Policies
5. Working Conditions
a) Working hours
b) Number and duration of rest intervals
c) Overtime work
d) Shift work
e) Safety rules and regulations
f) provision of transportation etc
Eg – Tesco paid salaries on hourly basis and time taken off for tea
break was not included in total working hours. The company
reduced 15 minutes of wages from employees who were late by
three minutes. The company did not pay for the first 3 days of sick
leave taken by employees and dismissed employees who took
many sick leaves
Eg – A poultry unit of US does not let the employees use the freshroom
because its an assembly line structure. An employee would use the
freshroom when the reliever relieves him
Coverage of Policies
6. Industrial Relations
a) Handling of grievances
b) Recognition of Trade union
c) Suggestion Schemes
d) Discipline and Conduct rules- Punctuality,
smoking and drinking
e) Workers participation – through quality
circles, total quality management etc
Matters to be included in Policy Formulation
•History
of company’s growth
•Employment practices and conditions of employment
•Grievance redressal procedure
•Safety rules and regulations and responsibilities of employees at work
•General Practices
•Mutuality of interests
•Employee financial Aid
•Educational Aids
•Employees news sheet and house journals
•Health & Hospitalization
•Vacation with pay
•Sickness, death and maternity benefits and allowances
•Prohibited Activities
•Labour Management & Industrial Relations etc
Nike’s Principles
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Minimizing impact on environment
There would be no discrimination based on
race, creed, gender and marital status or
maternity status age etc
The manufacturer would not have children
employed below the age of 18 to produce
footwear.
P &G s Principles
We show respect for all individuals
We believe that all individuals can and want to contribute
to their fullest potential
 We value personal mastery
We believe it is the responsibility of all individuals to
continually develop themselves and others
 We seek to Be the Best
We strive to be the best in all areas of strategic
importance to the Company
 Innovation is a corner stone of Our Success
We place great value on big, new consumer innovations
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TESCO’s Principle
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Lean Thinking is a way of working which increases value through the
elimination of waste. It has guided our supply chain thinking for over six
years. Womack and Jones define waste as:
Errors, Overproduction, Waiting for people, equipment or materials, excess
stock, dissatisfied customers
….And suggest an approach to reducing waste..
Specifying value by defining the value a customer places on an good or service
Lining up all the value creating activities or a product along a value stream
which reduces the eight wastes
Making value flow smoothly through the pull of the customer in pursuit of
perfection
Uni lever’s business principles
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Standard of Conduct
We conduct our operations with honesty, integrity
and openness, and with respect for the human
rights and interests of our employees.
We shall similarly respect the legitimate interests of
those with whom we have relationships.
Obeying the Law
Unilever companies and employees are required to
comply with the laws and regulations of the
countries in which we operate.
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Employees
Unilever is committed to diversity in a working environment where there
is mutual trust and respect and where everyone feels responsible for
the performance and reputation of our company.
We will recruit, employ and promote employees on the sole basis of the
qualifications and abilities needed for the work to be performed.
We are committed to safe and healthy working conditions for all
employees. We will not use any form of forced, compulsory or child
labour.
We are committed to working with employees to develop and enhance
each individual's skills and capabilities.
We respect the dignity of the individual and the right of employees to
freedom of association.
We will maintain good communications with employees through
company based information and consultation procedures.
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Conflicts of Interests
All Unilever employees are expected to avoid personal activities and financial
interests which could conflict with their responsibilities to the company.
Unilever employees must not seek gain for themselves or others through misuse
of their positions.
Compliance – Monitoring – Reporting
Compliance with these principles is an essential element in our
business success. The Unilever Board is responsible for
ensuring these principles are communicated to, and understood
and observed by, all employees.
Day-to-day responsibility is delegated to the senior management
of the regions and operating companies. They are responsible for
implementing these principles, if necessary through more
detailed guidance tailored to local needs.
Assurance of compliance is given and monitored each year.
Compliance with the Code is subject to review by the Board
supported by the Audit Committee of the
SUMMARY
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Family friendly policies should live up and not exist
on paper
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Men and women at all levels of companies in all
stages of their career development and all stages of
their life cycle are seeking flexibility to achieve a
better work life balance
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Family friendly policies are one way to support and
recognize the changing needs of employees