OBHRM NOTES
Module 1 - Introduction to the Organizational Behavior
Organization - An organization is a collection of two or more people who work together to
achieve predetermined goals.
Behavior - the action or reaction of a person in response to external and internal stimuli.
Understanding Behavior Through Different Levels of Analysis
1. Individual Level
2. Team Level
3. Organizational Level
Systematic Study - Identifies cause-and-effect relationships in behavior based on scientific
evidence.
Intuition - Gut feeling not necessarily supported by research.
Evidence-Based Management (EBM) - Uses hard facts and empirical evidence to make
decisions. Recognizes that different situations require different management approaches.
Organisation Behavior - OB is a field of study that investigates the impact of individuals,
groups, and structure on behavior within organizations to improve effectiveness.
Attitudes:
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The attitude object can be a person, product, or social group.
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Attitudes are evaluative statements – either favorable or unfavorable – about
objects, people, or events. (Robbins, Ed 18, pg 119)
What Shapes Attitudes?
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Inherited Attitudes: Some attitudes may be genetically transmitted from parents.
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Example: Thrill-seeking personality leading to a love for roller coasters.
Learned Attitudes:
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Direct and indirect experiences with the attitude object.
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Influence from media, peers, or role models.
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Example: If a favorite hero rides a roller coaster in a movie, a person may
develop a liking for it.
The Purpose of Attitudes
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Attitudes help in quick decision-making
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enable us to determine, often very quickly and effortlessly, which behaviors to
engage in
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Attitudes and Behavior
Leon Festinger’s Cognitive Dissonance Theory:
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Attitudes often follow behaviour.
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ABC Model of Attitude (Three Components):
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Affective Component (Feelings) – Expressing emotions about a person/event/object.
Behavioural Component (Actions) – What we intend to do regarding the attitude
object.
Cognitive Component (Thoughts/Beliefs) – Our knowledge and thoughts about an
attitude object.
Psychologists Found That Attitude-Behavior Consistency Is Higher When:
1. The attitude is strong and central to a person’s belief system.
2. The person is aware of their attitude.
3. There is little or no external pressure to behave in a particular way.
4. The person’s behavior is not being watched or evaluated.
5. The behavior is believed to have a positive consequence.
Perception & Attribution Theory
Perception
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Definition: The process of interpreting sensory stimuli to create meaningful
information.
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In Organizational Behavior (OB):
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Individuals select, organize, and interpret stimuli in their work environment.
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Perception influences how individuals act or react in the workplace.
Factors Influencing Perception
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Factors in the Perceiver: We hear what we want to hear and see what we want to
see. (attitudes, motives, experience, interests and expectations)
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Factors in the target: The relationship of a target to its background affects
perception. (novelty, sound, motion, size, bg)
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Factors in the situation: Location, light, heat, or personal situations impact
perception. (time, work setting and social setting)
Person Perception - Attribution Biases and Errors
Common Attribution Biases:
1. Fundamental Attribution Error
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Tendency to attribute others’ actions to internal factors (personality) rather
than external factors.
o
error explains why people often blame other people for things overwhich
they usually have no control
Types of Attribution
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Dispositional Attribution (Internal Factors): Behavior due to traits, abilities, or
emotions.
Situational Attribution (External Factors): Behavior due to external influences
2. Self-Serving Bias
o
We attribute our successes to internal factors but blame failures on external
factors – see ourselves in a favourable light
3. Just-World Hypothesis
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Belief that people get what they deserve.
Perception Errors
1. Halo Effect: Judging someone based on one positive characteristic.
2. Horn Effect: Negative first impressions shape future interactions as negative
3. Stereotyping: Assigning attributes based on group classification/class/category
4. Selective Perception: Selectively interpret information based on personal interests
and background – do not assess the whole picture
5. Recency Effect: Evaluating someone based on their most recent behavior.
6. Projection: Assuming others share the same beliefs or motives, hence attribute their
own feelings, emotions, thoughts etc
Emotions: Role, Sources, and Evolution
Affect – broad range of feelings that people experience – include emotions and moods
Emotions – triggered by a specific event and last for a small duration, usually very specific,
accompanied by facial expressions and results in an action
Moods – cause is often general and unclear, lasts longer, no facial expression as such,
cognitive in nature
Types of Emotions
1. Pleasant Emotions (Positive): helpful and essential to the normal development of
individual (Love, amusement, curiosity, joy)
2. Unpleasant Emotions (Negative): harmful to the individual’s development (Fear,
anger, jealousy, guilt)
Sources of Emotions & Moods
1. Personality
2. Time of day
3. Days of the week
4. Weather
5. Stress
6. Social activities
7. Sleep
8. Exercise
9. Age
10. Gender
Managing Emotions at Work
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Common Negative Workplace Emotions:
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Frustration/Irritation
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Worry/Nervousness
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Anger/Aggravation
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Dislike
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Disappointment/Unhappiness
A persona — a professional role that involves acting out feelings that may not be real as part
of their job.
Diversity and Inclusion in Workplace Management
Levels of Diversity
1. Surface-Level Diversity: Easily perceived traits, that do not necessarily reflect the
ways people think or feel but that may activate certain stereotypes (gender, race,
age, disability). – visible traits
2. Deep-Level Diversity: Personality, values, work preferences, beliefs that become
progressively more important for determining similarity as people get to know one
another better – more hidden
Workplace Discrimination
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Definition: Unequal treatment based on personal attributes rather than job ability.
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These grounds or characteristics include (but are not limited to) sex, gender, identity,
age, disability, religious beliefs, ethnicity, race, etc.
Examples:
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Job refusal
Unequal pay
Isolation by co-workers
Being assigned impossible tasks
Diversity Management
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Diversity management is an organizational process used to promote diversity and
inclusion in the workplace.
This process involves implementing policies and strategies in hiring,
management, training, and more.
Goals:
o Promote fairness and equality
o Leverage the advantages diverse organisations offer
Diversity Management Strategies
1. Attract, Select, Develop, and Retain Diverse Employees
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Diversity in groups
Expatriate Adjustment
Effective Diversity programs – Affirmative Action
2. Compelling Communication: Address cultural and language barriers
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Prioritize communication, consider feedback, and make use of the data to foster
diversity and positivity in the work environment.
Ensure that the employee is aware of the procedures, policies, security standards,
and other relevant information.
3. Leadership Commitment: Establish inclusive policies.
Managing Diversity in the Workplace
1. Prioritize Communication
2. Treat Each Employee as an Individual
3. Encourage Diverse Group Work
4. Be Open-Minded
5. Hire a Diverse Workforce
6. Implement a Zero-Tolerance Policy for Discrimination
7. Conduct Sensitivity Training
8. Stay Updated on Diversity Laws
Affirmative Action (positive discrimination):
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set of policies and practices adopted by the government through society to include
particular groups based on their caste, creed, gender, etc.
Purpose:
1. is to remove inequalities existing in society because of the caste system
2. bridge inequalities in employment faced by the disadvantaged group
3. access to education for all
4. redress issues of past injustices
works as a grievance redressal mechanism
Benefits of Affirmative Action
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Increased Opportunities
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Provides access to education for disadvantaged students.
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Enables career advancement for employees who face barriers in rising up the
corporate ladder.
Promotion of Diversity:
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Helps address the low percentage of diversity in leadership roles and media
representation. Encourages inclusive hiring and workplace practices.
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Recognition of Marginalized Groups:
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Ensures acknowledgment of the achievements of underrepresented
communities.
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Helps create equal opportunities for social and economic progress.
Disadvantages of Affirmative Action
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Limited Impact: Critics argue that despite decades of effort, affirmative action has
resulted in minimal changes to the status quo.
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High Costs: Implementing and maintaining such programs can be costly.
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Unwarranted Accommodations: Some believe affirmative action forces unnecessary
adjustments in hiring and admissions.
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Reverse Discrimination: Opponents claim it may overlook highly qualified candidates
in favor of less qualified individuals who meet policy standards.
Need for Affirmative Action
1. Ensures Equal Opportunity: Prevents deviation from the principle of natural justice.
2. Promotes Social Mobility: Reserves seats for low-income groups in education and
public employment.
3. Combats Discrimination: Allows underrepresented groups to be included in
education, the public sector, and legislative bodies.
Examples at the Workplace – Indian Perspective
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Reservations:
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Targeted Hiring
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Flexible Working Arrangements
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Employee Development
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Outreach Efforts
What Are The Challenges In Managing Diversity At Work?
1. Team-internal conflicts
2. Cooperation conflicts
3. The tokenism problem - Hiring for diversity without meaningful inclusion, leading to
feelings of isolation among minority employees.
Module 2: Personality, Behavior, and Emotional Intelligence
Personality
Personality describes the relatively stable set of characteristics, tendencies, and temperaments that
have been formed by heredity and by social, cultural, and environmental factors.
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Personality is the sum total of how an individual reacts and interacts with others.
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Influenced by genetics, upbringing, and life experiences.
Personality in Organizational Behavior (OB)
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Personality encompasses feelings, thoughts, behaviors, and responses.
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Helps predict an individual's behavior in various situations.
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Useful for managers in managing human behavior in organizations.
Personality Attributes in OB
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Core Self-Evaluations (CSEs) – bottom line conclusions people have about themselves such
as capabilities, competence and worth as a person
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Self-esteem (self-worth)
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Self-efficacy (confidence)
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Locus of Control (internal vs. external)
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Emotional stability (neuroticism)
Self-Monitoring
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Ability to adjust behavior to external situation factors.
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High self-monitors: Adjust behavior based on external sitatuation factors
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Low self-monitors: Show true dispositional attitudes to every situation.
Proactive Personality
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Identifying opportunities, showing initiative, taking action and perseverance until
meaningful change occurs
Personality and Situations
1. Situation Strength Theory
A theory indicating that the way personality translates into behavior depends on the strength of
the situation.
Situation strength, the degree to which norms, cues, or standards dictate appropriate behavior.
Strong situations show us what the right behavior is, pressure us to exhibit it, and discourage the
wrong behavior.
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"Strong situations" overpower personality traits.
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Personality traits influence behavior more in "weak situations."
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Four Elements (4 Cs) of Situation Strength:
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Clarity – Clear job roles create strong situations.
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Consistency – Compatible job expectations create stronger situations.
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Constraints – Limitations on decision-making affect personality expression.
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Consequences – The impact of decisions on the organization and individuals.
2. Trait Activation Theory (TAT)
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Some situations activate specific traits.
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explores the relationship between personality traits and workplace behavior
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According to TAT, traits are not consistently expressed but are instead brought to the
front by specific environmental triggers or situational cues. For instance, an
employee who does not typically take charge may become a decisive leader during
an emergency
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Example: Commission-based pay activates extroversion.
Values in the Workplace
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Values influence human behavior and workplace interactions.
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Values are long lasting and stable beliefs about what is good or what is bad.
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Types of Values:
1. Terminal Values: desriable end-states or objectives wished to achieve(e.g., success,
peace, wisdom).
2. Instrumental Values: Values are long lasting and stable beliefs about what is good or
what is bad. Means to achieve terminal values (e.g., honesty, responsibility).
3. Generational Values: Differences in values among generations.
The Big Five Personality Traits (OCEAN Model)
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Important for managers to have a very clear understanding of the personality traits that
essentially comprise the overall employee psychology of an organization, as well as specific
teams dealing with specific job responsibilities.
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Precise knowledge of the personality and individual differences would also enhance effective
management of the organization, particularly during a reform.
1. Openness to Experience – imagination and insight (Creativity, new ideas vs. resistance to
change)
2. Conscientiousness - high levels of thoughtfulness, good impulse control, and goal-directed
behaviors (Discipline, structure vs. procrastination)
3. Extraversion - excitability, sociability, talkativeness, assertiveness, and high amounts of
emotional expressiveness. (Sociability, energy vs. preference for solitude)
4. Agreeableness - trust, altruism, kindness, affection, and other prosocial behaviors.
(Compassion, empathy vs. self-interest)
5. Neuroticism - sadness, moodiness, and emotional instability (Emotional stability vs. anxiety
and stress)
Application of the Big Five in Organizations
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Cultural fit
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Team building
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Provide Counselling and Advice to the Team/individual ororganization.
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Reduce communication gap
The Generosity Spectrum (Adam Grant’s Theory)
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Types of People in the Workplace:
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Givers: Prioritize others' needs.
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Takers: Self-serving.
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Matchers: Operate on reciprocity (tit-for-tat).
Symptoms of Generosity Burnout
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Physical and emotional burnout
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Resentment and poor morale
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Lack of engagement
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Poor performance in others
Avoiding Generosity Burnout
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Set boundaries to prevent overcommitment.
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Avoid being exploited by takers.
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Encourage balanced generosity in workplace culture.
According to Grant and Rebele, your team members will likely fall into one of four personality types
on what they call the "Generosity Spectrum." These are:
• Takers.
•Matchers.
• Self-protective givers.
• Selfless givers.
Emotional Intelligence (EI)
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Definition: Emotional intelligence describes the ability, capacity, skill, or self-perceived ability
to identify, assess, and manage the emotions of one’s self, of others, and of groups.
Goleman argues that the emotionally intelligent worker is skilled in two key areas he presents
in his emotional competence framework.
• PERSONAL COMPETENCE - how we manage ourselves
• SOCIAL COMPETENCE - how we manage relationships
Daniel Goleman’s EI Model:
1. Self-Awareness – Recognizing personal emotions, moods and drivers and how it might affect
others. Includes self-confidence, realistic self-assessment, and a self-critical sense of humor.
2. Self-Regulation – ability to control or redirect disruptive impulses and moods, and the
propensity to suspend judgment and to think before acting. Includes trustworthiness and
integrity; comfort with ambiguity; and openness to change.
3. Social Awareness – the ability to recognize others’ emotions and the dynamics it plays within
the organization. Leaders who excel in social awareness practice empathy. They strive to
understand their colleagues’ feelings and perspectives, which enables them to communicate
and collaborate more effectively with peers.
4. Relationship Management – skills needed to handle and influence other people’s emotions
effectively. Proficiency in managing relationships and building networks, and an ability to find
common ground and build rapport. Include effectiveness in leading change, persuasiveness,
and expertise building and leading teams.
Application of EI in Organizations
1. Selection : using EI to hire people.
2. Decision Making: Positive emotions enhance decision making and
problem solving skills.
3. Creativity: People who are in good mood tend to be more creative
4. Motivation: Positive feedback and reinforce the positive mood
5. Leadership: Emotional appeals for convey the messages.
6. Negotiation: handling negative outcomes in a positive manner.
7. Customer Service: Worker’s emotional state – customer satisfaction.
8. Job Attitudes: Good day at work leads to better time at home.
9. Forgiveness in the organization: directly associated with the high quality
relationships and higher productivity.
10. Deviant Workplace behaviours: Negative emotions can be minimized.
Affective Events Theory (AET)
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Definition: Workplace events trigger emotional responses, affecting job performance.
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The Wide Range of Affective Events Theory Influences
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individual level (specific work events elicit certain emotional responses)
interpersonal level (dynamics of emotions within teams)
organisational practices level (successful organizations equally emphasize producing
favorable work events and minimizing negative work events)
Strenghts of AET
Emphasises emotional impact
Predictive capability
Comprehensive
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Limitations of AET
Temporal Aspect
Cultural factors
Ignores non-affect factors
Examples:
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Stressful situations may reduce efficiency.
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Positive experiences can boost engagement.
Emotional Labor and Emotional Dissonance
Emotional labor refers to the effort, skill, and energy required to manage one's emotions as part of
one's job responsibilities. This includes displaying certain emotions that are deemed appropriate or
required by the organization or job role, regardless of one's actual feelings.
Emotional dissonance occurs when there is a disconnect between the emotions that an individual is
expected to display in their role and their true feelings or emotional experiences. It refers to the
internal conflict or tension that arises when individuals are required to express emotions that are
incongruent with their genuine emotions or beliefs
Types of Acting in Emotional Labor:
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Deep Acting: modify their inner emotions so that these emotions are in line with the
behavior they are expected to portray in the workplace. So, workers give their best efforts to
actually experience the emotions they must show in the workplace. It takes time and a lot of
effort to change your feelings (instead of faking them), so deep acting is not easy to learn.
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Surface Acting: employees hide their emotions and fake the desired ones — i.e. the
emotions that are expected for a particular role. In addition, surface acting also includes
faking a good mood when communicating with clients. May lead to negative outcomes like
burnout or emotional exhaustion.
Positive Psychology: Emotional Hygiene & The Happiness Advantage
Emotional Distress - Mental suffering caused by someone else’s actions — either on purpose or
accidental.
Emotional Hygiene: refers to being mindful of our psychological health and adopting brief daily
habits to monitor and address psychological wounds when we sustain them. Psychological injury
happens from mental trauma caused by failure, rejection, and especially chronic loneliness.
Tips to improve emotional hygiene by Guy Winch:
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3.
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6.
7.
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Pay attention to emotional pain
Stop emotional bleeding
Protect your self-esteem
Battle negative thinking
Be informed about the impact of psychological wounds
Don’t let excessive guilt linger
Distract negative thoughts with positive actions/thoughts
Find meaning in loss
Happiness Advantage Theory (Shawn Achor):
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Draws a connection between personal happiness and professional success. This idea
proposes that the happier people are, the more successful they'll be.
Every business outcome shows improvement when the brain is positive.
There is a direct connection between life satisfaction and successful business outcomes
Module 3: Working with Diverse Others
Groups and Teams
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All teams are groups of people who share a common goal, but not all groups of people who
share a common goal are teams.
Work Groups:
o Interact primarily to share information and make decisions.
o Help each member perform within their area of responsibility.
Work Teams:
o Generate positive synergy through coordinated efforts.
o The result is greater than the sum of individual efforts.
Types of Groups
1. Formal Groups – Defined by the organization’s structure with designated work assignments.
2. Informal Groups – are alliances that are neither formally structured nor organizationally
determined. Natural formations in the work environment that appear in response to the
need for social contact.
3. Command Groups – Determined by the organizational chart, composed of individuals
reporting to a manager.
4. Task Groups – organizationally determined, represents individuals working together to
complete job task. Boundaries are not limited to its immediate hierarchical superior.
5. Interest Groups – – people who may/may not be aligned into common command or task
groups may affiliate to attain specific objectives with which it is concerned.
6. Friendship Groups – Form due to common characteristics among members.
Why Do People Join Groups?
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Security
Status
Self-Esteem
Affiliation
Power
Goal Achievement
Work Group Structure
Enduring Properties of Groups:
1.
2.
3.
4.
5.
Work roles
Work group size
Work group norms
Status relationships
Work group cohesiveness
Work Group Roles - People adopt different roles at different times.
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Three Types of Work Roles:
1. Task-Oriented Roles: Focus on task-related activities aimed at achieving performance
goals.
2. Relations-Oriented Roles: Focus on group cohesion, harmony, welfare of other
group members
3. Self-Oriented Roles: Focus on individual needs and goals, often at the expense of the
group.
Types of Teams
1. Problem-Solving Teams
o Improve processes to solve organizational problems that are harming them
o 5-12 members share ideas and offer suggestions.
o Only suggests, does not implement it themselves
2. Self-Managed Teams
o work in an extremely integrated and collaborative way because they work without a
formal leader.
o Perform independent tasks and take full responsibility.
o Select own members and assign tasks to them
3. Cross-Functional Teams
o Bring together members from different areas to solve problems. formed to develop
work with a multidisciplinary view, in which each area represented by team
members complements the knowledge of others,
o Example: Sustainability Committees, Boards of Directors.
4. Virtual Teams
o Work in different locations and rely heavilty collaboration tools to get work done
o better life-work balance and allow business owners to employ the best experts in the
field
Factors Determining Team Success
1.
2.
3.
4.
Adequate Resources
Leadership and Structure
Climate of Trust
Performance Evaluation and Reward System
The "Delta" Member of Your Team
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Teams have both Alpha (dominant) and Delta (problematic or dysfunctional) members.
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Strategies to Manage a Delta Member:
1. Reassign roles
2. Revise team processes
3. Give everybody a crash course on how to engage in healthy conflict
4. Invite the team to coach each other
Stages of Team Development
1. Forming –
- members may already know each other or they may be total strangers
- Large amount of uncertainty ( Que. like, Will I be accepted? What will my role be? Who has
the power here?”)
- members tend to be polite, conflict avoidant, and observant ( because of uncertainty)
- Members also begin to explore group boundaries to determine what will be considered
acceptable behaviour. ( Que like- “Can I interrupt? Can I leave when I feel like it?”)
- Abstract discussions about issues.
- This phase is usually short in duration, perhaps a meeting or two.
2.
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Storming –
Participants focus on becoming more authentic and more argumentative.
begin to explore their power and influence
Can be defensive, competitive, or jealous
Questioning starts at this stage(“Why should I have to do this? Who designed this project in
the first place? Why do I have to listen to you?”)
During this chaotic stage, a great deal of creative energy that was previously buried is
released and available for use, but it takes skill to move the group from storming to norming.
3. Norming - more committed to each other and the group’s goal
- In this stage group establish their own ground rules (or norms) and define their operating
procedures and goals.
- everyone has got a better handle on his or her role and real cooperation begins. The team
now considers itself a cohesive unit.
4. Performing –
- It’s not only getting the work done, but also pays greater attention to how they are doing it
- High productivity and teamwork
5. Adjourning –
- project is coming to an end and the team members are moving off into different directions
- The team leader should ensure that there is time for the team to celebrate the success of the
project and capture best practices for future use. (Or, if it was not a successful project - to
evaluate what happened and capture lessons learned for future projects).
Conflict Management
What is Conflict?
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Begins when one party perceives another is negatively affecting something they care
about.
Arises when actions are incompatible with one's own interests.
Incompatibility of goals, differences over interpretations of facts, disagreement
based on behavioral expectations etc.
Conflict Competence - The ability to develop and use cognitive, emotional, and behavioral skills that
enhance productive outcomes of conflict while reducing the likelihood of escalation or harm.
Advantages of Conflict competence management
1. Focus attention on things that matter
2. Can lead to sharing of information
3. Can ensure that people retain an open mind
4. Builds Relationships
5. Beats Stagnation
6. Encourages New Thinking
Examples of Workplace Conflict
1. Task Conflict –
- Disputes about how to divide up resources, differences of opinion on procedures and
policies, managing expectations at work, and judgments and interpretation of facts.
- How to handle- Task conflict often benefits from the intervention of an organization’s leaders
2.
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Relationship Conflict – Personality clashes.
Arises from differences in personality, style, matters of taste, and even conflict styles.
Focus on issues with each other rather than the situation
How to handle – mainly talking things out and trying to understand the other’s perspective
and even find common ground such as things you both may like
3. Value Conflict – Differences in beliefs and norms
- Differences in identities and values, which can include differences in politics, religion, ethics,
norms, and other deeply held beliefs
- How to Handle - Aim for a cognitive understanding in which you and your coworker reach an
accurate conceptualization of one another’s point of view.
Conflict Resolution Strategies
1. Avoiding: Walking away from the issue. Conflict is not really resolved.
2. Competing: One party wins at the expense of the other – only sees their own benefit and
interest – wants to end conflict asap
3. Accommodating: Yielding to maintain relationships – doesn’t allow all povs to be heard –
holdback frustration and feelings – requires self-sacrifice by one party – can lead to
unresolved conflicts
4. Compromising: Each side gives up something – “lose-lose” – perceived as fair eventhough
both parties will not be entirely happy about the outcome
5. Collaborating: Working together for a win-win solution – both assertive and cooperative
styles used by teams – every need met to the greatest extent possible
Conflict Resolution Process
Stage 1: Potential Opposition
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Conflict arises due to:
1. Communication Issues – Too much or too little communication.
2. Structural Factors – Differences in roles, goals, and responsibilities, leadership styles,
reward systems etc
3. Personal Variables – Personality differences, sarcasm, body language, too
authoritative or dogmatic
Stage 2: Cognition and Personalization
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Perceived conflict - Awareness by one or more parties about the existence of
conditions that create opportunities for conflict to arise
Felt conflict - Emotional involvement in the conflict creating anxiety, frustration and
enmity
It is the place in the process where the parties decide what the conflict is about and
emotions plays a major role in shaping perception.
Stage 3: Intentions
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Intentions are decisions to act in a given way intentions intervene between people’s
perception and emotions and their overt behavior.
Conflict resolution or negotiation intentions are ways by which the opposing parties to find a
solution to their disagreement that leaves everyone reasonably satisfied.
Stage 4: Behavior
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Conflict becomes visible.
The behavior stage includes the statements, actions and reactions made by the conflicting
parties. These conflict behaviors are usually overt attempt to implement each party’s
intentions.
Stage 5: Outcomes
1. Functional Outcomes: Improved decisions, creativity, and group performance.
2. Dysfunctional Outcomes: Reduced communication, hostility, and inefficiency.
Conflict Management Techniques
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Define Acceptable Behavior.
Pause, breathe, and assess next steps.
Address conflicts privately.
Encourage open communication.
Use active listening.
Frame statements using "I" messages.
Recognize when escalation requires HR intervention.
Follow up with final resolution steps.
Module IV: Introduction to Human Resource Management (HRM)
What is a Resource?
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Market
Machinery
Money
Materials
Men (Humans)
Human Capital Comprises of:
1. Intellectual Capital – Specialized knowledge, cognitive complexity, learning capacity, logic,
and skills.
2. Social Capital – Network of relationships, sociability, and trustworthiness.
3. Emotional Capital – Self-confidence, ambition, courage, risk-bearing capability, values, and
beliefs.
What is HRM?
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Definition: Process of managing people in organizations in a structured and thorough
manner
Key Idea: Managing people is complex and requires linear thinking.
Few Definitions:
Dessler: HRM is a process of acquiring, training, appraising, and compensating employees
while addressing labor relations, health, safety, and fairness concerns.
John Storey: HRM is a distinctive approach to employment management aimed at
competitive advantage through a highly committed and capable workforce.
Evolution and Development of HRM
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1900: Employee Welfare
1920-1930: Personal Administration
1940-1960: Personal Management
1970-1980: Personal / Human Resource Management
1990: Human Resource Management
2000: Strategic Human Resource Management
The Essence of HRM
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Definition: Art of managing people so well that they bring their best to the organization
Key Aspects:
o Purpose: Common set of values uniting workers in a common goal.
o Potential: -Capitalize on what their people can do – get right people on the right
time despite where they belong on the organizational chart
o Perspective: Challenges an organization to act boldly in the face of uncertainty Focus on outcome instead of output - Re-architect human strengths and capability.
HR’s Role: Acting boldly in uncertainty and rearchitecting human strengths and capabilities.
Scope/Functions of HRM
1. HRP
2. Job Analsyis
3. Job Evaluation
4. Hiring and seletion
5. Performance appraisal
6. Employee motivation
7. Training and development
8. Employee compensation
9. Employee welfare
10. Industrial Relations
The Environment of HRM
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Trends Influencing HRM:
1. Social, Demographic, and Workforce Trends
2. Geographic/ Globalization Trends
3. Economic Trends (GDP, Recession, etc.)
4. Technological Trends
▪ Social Media
▪ Mobile Applications
▪ Cloud Computing
▪ Data Analytics
▪ Artificial Intelligence
5. Political Trends and Values (Election results, regulations, special interests, evolving
values)
6. Competitive Trends
Difference Between HRM and PM
Human Resource Planning (HRP): Workforce Planning
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A process by which an organisation should move from its current manpower position to its
desired manpower position. Through planning, management strives to have the right
number and right kind of people at the right places at the right time, doing things which
result in both the organisation and the individual receiving maximum long-run benefit.
Ensure the right number and kind of people are available at the right time.
Acts as a link between HR management and the overall strategic plan of an organization.
Importance of HRP
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Meeting organizational requirements.
Counterbalancing insecurity and change.
Checking labor imbalance.
Right-sizing human resource requirements.
Supporting expansion and diversification needs.
Training and development of employees.
Fulfilling individual employee needs.
Budget formulation.
Checking joblessness.
Factors Affecting HRP
1.
2.
3.
4.
5.
6.
Type and strategy of the organization (Manufacturing vs. Service).
Organizational growth cycles and planning.
Environmental uncertainties.
Outsourcing.
Labor market conditions.
Type and quality of forecasting information.
HRP Process
Step 1: Environmental Scanning
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Systematic monitoring of external forces influencing the organization:
o Economic factors
o Technological factors
o Demographic changes
o Political issues
o Social concerns
Step 2: Organization Objectives and Policies
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HR objectives must align with organizational objectives.
Challenges:
o Constraints in HRP development.
o Ensuring continuous involvement and workforce adaptability.
o Enriching employee job roles and experiences.
Step 3: HR Programming
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Demand Forecasting
Supply Forecasting
Step 4: HR Plan Implementation
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Includes:
o Recruitment and selection
o Training and development
o Retraining and redeployment
o Retention planning
Step 5: Control and Evaluation
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Establishing reports, budgets, and standards.
Measuring recruitment targets vs. actual hires.
Techniques of Manpower Demand and Supply
Demand Forecasting
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Techniques:
1. Trend Analysis
2. Ratio Analysis
3. Scatter Plot
4. Managerial Judgment
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Factors Affecting Demand Forecasting:
o Employment trends
o Replacement needs
o Productivity
o Absenteeism
o Expansion and growth
Supply Forecasting
• Forecasting Supply of Internal Candidates
1. Personal Replacement Charts
2. Markov Analysis
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1.
2.
3.
Forecasting Supply of External Candidates
Predictive Workforce Monitoring
Matching Projected Supply and Demand with a Plan
Succession Planning
External Factors Affecting HR Supply Forecasting
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Supply and demand of jobs.
Literacy rate of the nation.
Population growth rate.
Industry growth rate and expected levels.
Technological development.
Compensation systems based on education, experience, skills, and age.
Internal Factors Affecting HR Supply Forecasting
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Organizational features (e.g., staffing capabilities).
Productivity rates and productivity changes.
Promotion, demotion, transfer, and turnover rates.