DEFINITIONS

Human resource management is the
process of acquiring, training, appraising
and compensating employees and
attending to their labour relations, health,
safety and fairness concerns.---- Dessler

HRM is a series of integerated decisions
that form the employment relationship;
their quality contributing to the ability of the
organisations and employees to achieve
their objectives.—--Milkovich & Boudreau
NATURE


Inherent part of management : HRM is a part
of Mgt., draws heavily from Mgt. concepts,
principle & techniques. This function is
performed by all the managers throughout the
organization rather than by the personnel
department only.
Pervasive Function : All managers at various
levels in the organization are required to perform
the personnel functions on a continuous basis. It
is not a responsibility that a manager can leave
completely to someone else.
Basic to all Functional areas : All the
departments has to perform personnel
functions.
 People centred : HRM is concerned with
people in the organization both present
and potential. It is concerned with Top
mgt., Middle mgt., Supervisory mgt. &
Operatives.
 Personnel activities : Manpower
planning, Employment, Placement,
Training, Appraisal & Compensation.
Performed by HR department.

Continuous Process : It is not a ‘one
shot’ function. It requires a constant
alertness and awareness to achieve the
objectives.
 Based on Human Relations : human
relations in the organization will be cordial.
Motivation of human resource is very
important.

SCOPE
Human resource / Manpower planning –
determining the number and kinds of
personnel required to fill various position in
the orgnisation.
 Recruitment, selection and placement of
personnel – Employment function.
 Training and development of employees
for their efficient performance and growth.
 Appraisal of performance employees.

Motivation of work force.
 Remuneration of employees. ---sufficient
wage and fringe benefits.
 Social security and welfare of employees.
Canteens, crèches, housing, recreation &
health.
 Review and audit of personnel policies,
procedures and practices of the
organisation.
 Industrial relation aspects is concerned
with union negotiation and collective
bargaining.

Functions

1.
Managerial : HRM is a part of
organizational management.
Planning :is the conscious determination
of future course of action to achieve the
desired results. Determination of
personnel programs that will contribute to
the goals of enterprise. It includes a
supply and demand forecast for each
category, net shortage and excess of
personnel .
2.
3.
Organizing : is the process of dividing work
(personnel activity) in to convenient tasks or
duties, grouping of such duties in the form of
positions, grouping of various positions in to
departments and sections, assigning duties in
to individual positions and delegating authority
to each position so that work is carried out as
planned.
Directing :when people are available in the
organization, they must know what they are
expected to do in the organization. It include
communicating, motivating and leading. To
guide and motivate people to accomplish
personnel programmes.
4.

A.
Controlling : Involves comparing actuals with
standards and corrective action. It involves
performance appraisal, critical examination of
personnel records and statistics and personnel
audit.
Operative :Duties/ tasks which are specifically
entrusted to the human resource department.
Employment : proper kind and number of
persons are necessary to achieve the objective
of the organisation. It includes manpower
planning , recruitment, selection, Induction
,Placement.
B.
C.
Development : To train each employee
properly to develop technical skills & develop
him for the higher jobs. There is On-the-job
and Off- the job methods are available.
Compensation : Determination of adequate
and equitable remuneration. The personnel
can be compensated both in terms of monetry
as well as non-monetary terms. While fixing
the wage, the following factors should be
considered. Basic needs of the personnel,
legal provisions regarding minimum wage,
capacioty of the organization to pay, wage
level afforded by competitors. Job evaluation
and performance appraisal can be followed.
D.
E.
F.
Maintenance ( Working Conditions
and Welfare) : Measures taken for
health , safety, cafeteria, rest rooms,
counseling, group insurance recreations
etc…
Motivation : HR manager helps the
various departmental mangers to design
a system financial and non-financial
reward to motivate employees.
Personnel records :Records of their
training, achievements, transfer,
promotion, absenteeism and labour
turnover, policies…
G.
H.

A.
B.
Industrial Relations : settlement of disputes,
collective bargaining …..
Separation : HR manager has to ensure the
release of retirement benefits…..
Advisory : Gives advise relating human
resource of the organization.
Top Management : evaluation of personnel
Programme, policies & procedures.
Department heads : performance appraisal ,
job analysis, manpower planning training ,
recruitment…
Importance of HRM / Role of HR
Manager

Policy Formulation : HR policies are
indented to communicate to the
employees the basic ground rules under
which the organization functions and to
avoid discrimination, inconsistency and
confusion. HR manager helps top
management in the formulation of policies
on wage and salary, administration,
transfer, appraisal, welfare activities,
personnel records and work environment.



Advisory Role : advice to line managers ,
Department Heads, Top management. Matters
like grievance over distribution of overtime work,
disciplinary action, labour laws, preparation of
reports.
Linking Pin Role : Linking Pin between
management and the workers.
Representative Role : generally act as a
spokesman of the top management,
representative of company. Sometimes worker’s
representative, particulary in non-unionised
organisations.
Decision making Role : Plays effective role
in decision making on issues related to
human resource.
 Mediator Role : Mediator in the event of
conflict between employees, group of
employees, superior & subordinate and
even between management and
employees.
 Leadership Role : provides leadership,
guidance and counseling to employees.

Welfare Role : Act as welfare officer. He is
concerned with provision of canteen,
crèches, hospital and other welfares.
 Research Role : on the basis of records he
undertake various research in various
personnel areas absenteeism, labour
turnover etc..

Human Resource Planning

Human resource planning is the process by
which an organisation ensures that it has the
right number and kind of people, at the right
place, at the right time, capable of effectively
and efficiently completing those tasks that will
help the organisation to achieve its overall
objectives. ---- Decenzo & Robbins

Manpower planning is the process of
determining manpower requirements and the
means for meeting those requirements in order
to carry out the integrated plan of the
scope






Listing of current manpower with the
organisation.
Assessing the extent to which the current
manpower is utilised to the advantage of the
organisation.
Phasing out the surplus manpower/if any.
Analysing the requirements of manpower in
future in the light of expansion plan, retirement
of personnel.
Making manpower procurement plan.
Designing training programmmes for different
categories of manpower.
Objectives





To ensure optimum use of human resource
currently employed.
To determine future recruitment level.
To provide control measures to ensure that
necessary resources are available as and when
required.
To anticipate redudancies and avoide
unnecessary dismissals.
To forecast future skill requirements to serve as
a basis for training and development
programmes.
To assess future housing needs of
employees.
 To cost the manpower component in new
projects.
 To decide whether any of enterprise
activities be off-loaded or subcontracted.
(maintenance)
 To control cost aspect of human resource.
 To formulate transfer and promotion
policies.

Process
1.
2.
Objectives of manpower planning : HRP
must be integrated with the overall
organizational plan. The ultimate purpose
of HRP should be decided.
Analysis of current manpower inventory :
analysis of current manpower supply
may be undertaken by department, by
function, by occupation, or by level of
skill or qualification.
3.


Demand forecasting : A proper forecast of
manpower required in the future ( say after
one year, two years, three years and so on)
must be attempted .
Employment Trends : The manpower planning
committee at the corporate level should make
an examination of number of employees on
the payroll during the past five years to know
the trend.
Replacement Needs : Need of replacement
arises due to death , retirement, resignation
and termination of employees.( supervisory.
Skilled, managerial, clerical)

i.
ii.
iii.
Productivity : Gains in productivity add to the
growth potential of the organisation.Planning
for productivity gains has several aspects.
The first and important one relates to affecting
gains by improvement in existing manapower
utilisation.
The second aspect relates to installation of
more productive tools , equipments or
process. (Automation).
The last aspect relates to the matching of skills
with the requirements of the jobs.(Job
Analysis)



4.
Growth and Expansion : Expansion of
various plants and divisions.
Absenteeism : it mean a situation when
a person fails to come for work when he
is scheduled to work. Planning expert
should consider the rate of absenteeism.
Work study : workload analysis.
Supply forecasting : there is two sources
of supply – internal and external.
i.
ii.
5.
Human Resource audit : It gives idea
about the potential and capabilities of
people working in an organisation.
(management inventories, skill
inventories)
Replacement Charts : These are meant
for listing each key position and
indicating time when it it is likely to be
vacated.
Estimating the Net Human Resource
Requirements: compare the demand
forecast with the projected internal
supply of human resource.
6.
7.
8.
Action Plan for Redeployment
/redundancy : In the case of surplus staff
position, employees caan be redeployed
to other jobs / departments. If it is cannot
be redeployed , offer golden handshake
under VRS scheme.
Determining Job Requirements of
position to be filled : accurate job
description help in finding suitable
candidates.
Employment plan : Preparing the
programmes of recruitment , selection,
transfer, promotion….
9.
10.
Training and development programe : the
talents of the employees are not fully
productive without a systematic T & D.
Evaluation of effectiveness of HRP
Objectives of Inventory of
HRP
HR Skills
Appraisal of
HRP
T&D
Programme
Demand &
Supply
forecasting
Determine Net
Manpower
Requirements
Employment
Program
Redeployment
&
Redundancy
Plan
Benefits of HRP
1)
2)
3)
4)
5)
6)
7)
HRP results in reduced labour costs
It is a better basis for planning employee
development.
It enables identification of the gaps of the
existing manpower.
It leads to improvement in the overall business
planning process.
It helps in formulating managerial sucession
plan.
It leads to greater awareness of the importance
of sound management.
It serve as a tool to evaluate the effect of
Quantitative aspects of HRP

1.
Demand forecasting : Estimating the
requirements of different kinds of personnel in
future. HRP forecast should be the annual
budget and long-term corporate plan translated
in to activity levels of each functions and
department. There are three basic techniques.
Managerial judgment :Used in smaller
companies. This simply requires manager to
sit down, think about their future workloads
and decide how many people they need. It
might be done on a
bottom-up basis – line managers
submitting proposals
 Top-down approach : Forecasts are
prepared by the top management. These
are reviewed and agreed with the
departmental managers.
 The best way to adopt both the bottom-up
and top-down approach.

2.


Work study technique : It can be used when it
is possible to apply work measurement to know
how long operations should take and the
amount of labour required.
planed output
Work-load analysis : in this , the manpower
planning expert needs to find out sales
forecast, work schedules and thus determine
the manpower required per unit of product.
Work-force analysis : it is necessary to keep
sufficient margin for absenteeism, labour
turnover and idle time on the basis of past
experience.
3.
i.
ii.
Statistical techniques :For long range &
more accurate personnel forecasting.
Ratio and Trend analysis : Calculation on the
basis of established ratios. It is worked out for
number of years based on the past records of
the organisation and future trends are
projected on these ratios. (supervisory &
managerial)
Econometric model : it helps in understanding
the nature of relationships among different
variables at the different levels. Suitable for
large organisations. It refers to the science of
economic measurement.
iii.
iv.
Regression analysis : In this human
resource needs is the dependent
variable and independent variables are
business activity, HR productivity…
Bureck-smith model : Forecasting based
on the selected key variables that affect
an organisations HR needs.
En = (Lagg + G) /x
Y
En = estimated level of HR needed in ‘n’
plan period.
Lagg =total business activity of ‘n’ period in
terms of value
G = total growth in business activity in ‘n’
period based on the current prices.
X = average productivity improvement in ‘n’
period over the current period.
Y = business activity—personnel ratio of the
current year.
4.
Delphi Technique : A small group
designs questionnaire about the problem
under study which is sent to various
experts related to the field. Filled up
questionnaires are analyzed. If any
divergence in opinion, a revised
questionnaire sent to large experts. It will
continue until some consensus reached.(
Fashion trends for next year). Here It can
be used to know the trends in changing
job profile & personnel profile across the
country and international level. It helps to
get experts view in different functional
area.

1.
Supply forecasting : Manpower suply
forecasting measures the number of
people likely to be available from within
and outside an organisation, after
making allowance for absenteeism,
internal movements and promotions,
wastage and change in work hours and
other working condition of work.
Markov Analysis : Historical flows of
personnel (transitions) through the
organisation are represented by
probabilities. (Ref.—p174 HRM, L.M Prasad)
2.
3.
4.
Simulation techniques : It considers
alternative flows which are examined for effect
on future manpower supplies. Alternative flows
reflect the anticipated result of policy or
programme changes concerning voluntary
turnover retirement , promotion etc…
Renewal analysis : this technique future flows
and supplies of manpower by calculating (i)
vacancies created by the organisation (ii) the
results of decision rules governing the filling of
vacancies.
Goal programming : The goal to optimize the
desired stafing pattern subject to a set of
constraints (salary budget, new recruitment
permitted.)
5.


Human resource inventory : It is the
cataloguing the present and future potentials.
It includes
Skill inventory (non-managerial) : Personal
data, skills-education, job experience, training,
special achievements, salary, job history,
potential of employees.
Management inventory :Personal data, work
history, strength and weakness, career plan,
promotion potentials, number and type of
employee managed, total budget managed,
special achievements.