Human Resource Management 1

HUMAN RESOURCE MANAGEMENT

Human Resource Management (HRM) is an important area of management.

Different terms such as labour management, personnel management, human
capital management, and personnel administration are used to denote HRM.
People are an organization’s most important asset. Success of any business is
greatly influenced by the calibre and attitude of the people who work for it. HRM is
a process of bringing people and organizations together so that the goals of
each are met. It is an art of procuring, developing and maintaining competent
workforce to achieve the goals of an organization in an effective and efficient
manner.

According to Edwin B. Flippo, “HRM is the planning, organising, directing and

controlling of the procurement, development, compensation, integration,
maintenance and reproduction of human resources to the end that individual,
organisational and societal objectives are achieved”.
2 Human Resource Management (T.Y.B.Com.) (Sem. – VI)

Nature / Features of HRM

1. Process

HRM is a process of managing human resources. The process of HRM

includes:

 Acquisition of human resources: Human resource planning, recruitment,

selection, placement and induction of staff.

 Development of human resources: Training and development of human

resources.

 Motivation of human resources: Performance appraisals, giving

recognition and rewards to the staff, handling their problems etc.

 Maintenance of human resources: Providing proper working conditions,

health and safety of staff etc.

2. Continuous in nature

HRM is not a one-time function. It is a continuous process. In other words, HR

must be managed on a continuous basis. It has to continuously change and adjust
according to the changes in the environment, changes in the expectations of the
staff, etc.

3. Focus on objectives

HRM aims at achievement of objectives. These include :

 Organisational objectives such as growth, profitability, innovation etc.

 Individual objectives such as high salary, job satisfaction, job security,

recognition etc.

 Group or Departmental objectives such as team work.

 Societal objectives such as social development, protecting the

disadvantaged sections of society, developing society in general etc.

4. Universal application

HRM has universal application. It is all pervasive. That is, it can be used for
business as well as for other organisations such as schools, colleges, hospitals,
social, political and religious organisations, government departments etc.
Human Resource Management 3

5. Integrated use of subsystems

HRM makes use of subsystems such as organisational development, training,

performance appraisal, career development etc. All these subsystems are
necessary to increase the efficiency of the staff and to bring success to the
organisation.

6. Multidisciplinary

HRM is multidisciplinary. It utilises knowledge and inputs drawn from different

subjects such as psychology, sociology, philosophy, communication, education,
organizational behaviour etc.

7. People oriented

HRM is concerned with employees- both as individuals and as a group in

attaining goals. It is also concerned with behaviour, emotions and social aspects of
personnel. It covers all levels of employees i.e. low, middle and top and all
categories of employees such as unskilled, skilled, technical, professional, clerical
and managerial. It covers both organized and unorganized employees.

8. Team spirit

HRM tries at developing and maintaining team spirit of the groups and
departments of the organisation. Team spirit helps the staff to work together for
achieving the objectives of the organisation. Team work brings success to the
organization.

9. Functions

Human Resource Management involves several functions concerned with the

management of people at work. It includes manpower planning, employment,
placement, training, appraisal and compensation of employees.

10. Art & Science

HRM has to deal with employees from diverse background, having diverse
culture and expectations. HR executives need to be creative when interacting with
different people. So it is an art. Similarly, recruitment, selection, training etc.
necessitates HR staff to be scientific & systematic, thus making it a science.
4 Human Resource Management (T.Y.B.Com.) (Sem. – VI)

Significance/Importance of Human Resource Management

The importance of HRM can be seen at four levels, namely :

 At Corporate Level

 At Professional Level

 At Social Level

 At National Level

1. At corporate level

For an organization, effective HRM leads to attainment of its goal efficiently

and effectively. HRM helps the organization in the following ways 
Attracting and recruiting best talent.

 Retaining employees through effective human resource planning,

recruitment, selection, placement, orientation and promotion policies.

 Development of employees by enhancing necessary skills and imparting

right attitude among them through training, development, performance
appraisals etc.

 The available human resources can be put to optimum utilization by

effective HRM.

 HRM also ensures that organization has a competent team and

dedicated employees in future.

2. At Professional Level
Human Resource Management 5

 HRM helps in identifying the aptitude and skills of employees.

 It also contributes to professional growth by providing opportunities for

development of employees

 It improves interpersonal communications and relationship amongst

employees.

 It leads to improved quality of work life

 It enables effective teamwork among employees by providing healthy

working environment.

 It enables allocating work properly to employees as well as to teams and

developing healthy relationships among teams.

3. Social Level

HRM plays important role in the society.

 It helps labour to live with pride and dignity by providing employment

which in turn gives them social and psychological satisfaction.

 It enhances the quality of labour force which leads to improvement in

the productivity of labour.

 It maintains balance between human resource demand and human

resource supply i.e. between open jobs and job seekers.

4. National Level

HRM plays a very significant role in the development of nation.

 Efficient and committed human resource leads to effective utilization of a

nation’s natural, physical and financial resources.

 Skilled and developed human resource ensures rapid economic

development of the country.

 Effective HRM enhances economic growth which in turn leads to higher

standard of living and maximum employment.
6 Human Resource Management (T.Y.B.Com.) (Sem. – VI)

Functions of Human Resource Management

1. Human Resource Planning (HRP)

Human Resource planning is a primary activity of HRM. Human Resource

Planning is the process by which the organization ensures that it has the right kind
of people, at the right time and at the right place. HRP involves activities such as :

 Taking inventory of the present human resources.

 Forecasting manpower requirements.

 Forecasting supply of human resources.

 Estimating manpower gaps.

 Action plan, in case of shortage or surplus of manpower.

2. Acquisition function / procurement

This function is concerned with procuring and employing people who

possess necessary skill, knowledge and aptitude. This function includes :

Job Analysis : Collecting information related to the operations and

responsibilities of a specific job.

Recruitment : Process of searching for prospective employees and

stimulating them to apply for jobs in the organization.

Selection : Choosing the most suitable candidates from those who have
applied for the vacant posts.

3. Placement

Placement is done after selection of employees. It means to put the right man
in the right place of work. It is a process of assigning a specific job to each of the
selected candidate. It involves assigning a specific rank and responsibility to an
individual. It is matching of employee's specifications with job requirements. Proper
placement gives job satisfaction to the employees and it increases their efficiency.

4. Performance appraisal

Performance appraisal is a systematic evaluation of the employees'

performance at work. It is a review of an employee's performance of assigned
duties and responsibilities. Such evaluation is done with respect of certain
predetermined criteria such as job knowledge, quality and quantity of output, co-
Human Resource Management 7

operation, leadership abilities, versatility etc. Performance appraisal helps in

identifying strengths and weaknesses of the employees. This helps in framing
training and development programs.

5. Training and development

One of the vital functions of HRM is to provide training and development to the
employees. Training and development refers to the imparting of specific skills,
abilities and knowledge to the employees. It is the process of planned program
undertaken for improvement of employees' performance. Such programs help in
achieving organizational and personnel goals.

6. Compensation function

Compensation refers to all the rewards earned by employees in return for their
labour. It includes :

 Direct financial compensation consisting of pay received in the form of

wages, salaries, bonuses and commissions provided at regular and
consistent intervals.

 Indirect financial compensation which includes benefits, leaves,

retirement plans, recognition, certificate of appreciation etc.

Appropriate rewards motivate employees to improve their performance.

7. Career planning and development

These days, many organizations facilitate career planning and development of

their employees. Career planning involves deciding on the career goals of the
employees and the route to achieve these. Career development refers to programs
designed to match an individual's needs, abilities and career goals with
opportunities in the organization. Such career planning and development not only
helps the employees but also the organization to achieve growth.

8. Employees' welfare

Employee welfare includes the services, amenities and facilities offered to

employees within or outside the organization. Some of these include housing,
transportation, education, recreation facilities etc. Welfare measures are in addition
to regular wages and other economic benefits given to the employees. Such
measures help in keeping the morale and motivation of the employees high.
8 Human Resource Management (T.Y.B.Com.) (Sem. – VI)

9. Labour relations

HRM also includes maintaining industrial relations. It includes union

management relations, joint consultations, negotiating, collective bargaining,
grievance handling, disciplinary actions, settlement of industrial disputes, etc. This
helps the organization to ensure smooth working in the company.

10. Maintenance function

HRM also performs the maintenance function. That is, protecting and
promoting the health and safety of the employees. For this the organization adopts
health and safety measures. It also provides other benefits such as medical aid,
provident fund, pension, gratuity, maternity benefits, accident compensation, etc.,
to the employees.

11. Emerging Functions : These include :

 Human Resource Accounting (HRA) : HRA is a measurement of the cost

and value of human resources to the organization.

 Human Resource Audit : It refers to an examination and evaluation of

policies, procedures and practices to determine the effectiveness of HRM.

 Human Resource Research : It is the process of evaluating the

effectiveness of human resource policies and practices and developing
more appropriate ones.

 Human Resource Information System : It refers to an integrated system

designed to compile HR data. Such a data serves as a source of
information to the management.

 Stress Management and Counselling : Many organization companies try

to promote the physical and mental wellbeing of employees through proper
counselling and employee development programmes. Counselling the
employees helps them in solving their personal, family and work problems.

HUMAN RESOURCE PLANNING (HRP)

Human resource planning or manpower planning is one of the crucial aspects

of human resource management. It is the primary activity of HRM. All human
resource activities start with human resource planning. In simple words, HRP is
Human Resource Management 9

the process of getting the right number of qualified people into the right job
at the right time. From HRP the organization identifies how many people it has
currently and how many people will be required in future. Based on this information
major human resource decisions are taken.

Human Resource Planning can be defined as “a process of predetermining

future human resources needs and course of action needed to satisfy those
needs to achieve organizational goals.”

Steps in Human Resources Planning

Human resources planning is the process of identifying current and future

human resources needs of an organization. It involves securing the right
manpower in order to achieve organizational goals. Following are the major steps
involved in human resource planning :

1. Analysis of the environment

The first step involves an analysis of external and internal environmental

factors pertaining to human resources. Some of the external environmental factors
include labour market trends, economic conditions, level of competition,
demographic trends, laws relating to employment, technological advancements
etc. While the internal environmental factors include workforce composition,
organization structure, values and ethics, work culture etc.

2. Analysis of organizational objectives

The HR manager studies the objectives of the organization. The objective to

be achieved in various areas such as production, marketing, finance, expansion
and sales gives the idea about the nature and type of work required to be done in
the organization.

3. Inventory of present human resources

The HR manager has to undertake inventory of present human resources.

From the updated human resource information system, the current number of
employees, their capacity, performance and potential can be analysed. To fill the
various job requirements, the internal sources (i.e., employees from within the
organization) and external sources (i.e., candidates from various placement
agencies) can be estimated.
10 Human Resource Management (T.Y.B.Com.) (Sem. – VI)

4. Forecasting demand and supply of human resource

Demand forecasting is a process of determining future needs for HR in terms

of quantity and quality. The human resources required at different positions
according to their job profile are estimated. The available internal and external
sources to fulfill those requirements are also measured.

Supply forecasting is concerned with the estimation of supply of manpower

given the analysis of current resource and future availability of human resource in
the organization. It estimates the future sources of HR that are likely to be
available from within and from outside the organization. Internal source includes
promotion, transfer, job enlargement and enrichment, whereas external source
includes recruitment of fresh candidates.

5. Estimating manpower gaps

Comparison of human resource demand and human resource supply helps in

estimating manpower gaps i.e. surplus or deficit of human resource. Deficit
represents the number of people to be employed, whereas surplus represents
termination.

6. Matching demand and supply

This is the next step in human resource planning. It is concerned with bringing
demand and supply in an equilibrium position so that shortages and over staffing
position will be solved. In case of shortages an organization has to hire more
required number of employees. Conversely, in the case of over staffing it has to
reduce the level of existing employment. This can be done by interdepartmental
transfer, voluntary retirement schemes, redeployment etc.

7. Action plan

The HR plan is executed through the designation of different HR activities. The

major activities which are required to execute the HR plan are recruitment,
selection, placement, training and development etc.

8. Monitoring, control and feedback

After implementation of the HR plan, it has to be monitored strictly to identify

the deficiencies and remove it. Comparison between the human resource plan and
Human Resource Management 11

its actual implementation is done periodically to know the progress in

implementation.

JOB ANALYSIS

The term “job” refers to a group of tasks to be performed. It means a collection

of duties and responsibilities which are assigned to individual employees. HR
managers need to undertake job analysis. In simple words, Job Analysis means
a process of collecting information about a job. The information collected
relates to the nature of the job and the qualifications and skills required for
performing the job. Job Analysis is the starting point of the process of recruitment
and selection.

According to Edwin Flippo, “Job Analysis is the process of studying and

collecting information relating to the operations and responsibility of a specific job.”

There are two aspects of job analysis i.e. Job description and Job
specification. The requirements of job are known as job description and the
qualities required from the jobholder are termed as job specification.

Components of Job Analysis

There are two components of job analysis- Job Description and Job
Specification. While job description emphasizes the job requirements, job
specification sets forth requirements sought in the person who is to perform the
job. These are further explained as under :

Job Description
12 Human Resource Management (T.Y.B.Com.) (Sem. – VI)

A job description is a written statement that describes the duties,

responsibilities, required qualifications and reporting relationships of a
particular job. It tells in brief the nature and type of a job. It describes the general
tasks and responsibilities of a given job or position. It states the duties, purpose,
responsibilities and scope of a particular job. It also includes information about
working conditions, tools, equipment used, knowledge and skills needed,
relationships with other positions etc. Job description forms the basis of job
specification.

According to Edwin Flippo, “job description is an organized factual statement

of the duties and responsibilities of a specific job. It should tell what is to be done,
how it is done and why.”

The contents of job description are as under :

1. Job title

It explains the title of the job. It means, what the particular job is all about is
identified under this content.

2. Job location

It refers to the place where the job is to be performed i.e. in which department.

3. Job summary

Job summary describes the contents of the jobs in terms of activities or tasks
to be performed. It is a statement which explains what the job entails.

4. Duties and responsibilities

This is an important phase of job description. It describes the duties to be

performed. Responsibilities concerning custody of money supervision and training
of staff etc. are also described.

5. Machines, tools and material

It states the type of machines, tools and materials required in the performance
of the job.

6. Working conditions

It defines working conditions in terms of heat, light, noise level etc. Job
hazards are also mentioned. Job hazards are obstacles and obstructions that may
arise during actual performance of the task.
Human Resource Management 13

7. Nature of supervision

The nature of supervision on each job is also mentioned. There are certain
jobs like unskilled jobs which require close supervision while other jobs like skilled
or supervisory or managerial jobs require less supervision.

8. Relation to other jobs

It indicates relationship of the job with other jobs of the organisation. It also
indicates to whom the job holder has to report and who will report to him.

Job Specification

Job specification is a written statement of qualifications, traits, physical and

mental characteristics that an individual must possess to perform the job duties
and discharge responsibilities effectively. It is an overall summary of employee
requirements to perform the job effectively.

According to Edwin Flippo, Job Specification is, "a statement of minimum

acceptable human qualities necessary to perform a job properly.”

Features

1. Physical characteristics : This includes height, weight, vision, hearing,

fitness, health, physical stamina, capacity to use or operate machines, tools,
equipments etc.

2. Mental characteristics : This includes general intelligence, memory,

judgment, foresight, ability to concentrate, analytical and logical reasoning,
creativity etc.

3. Personal characteristics : such as age, gender, education, job experience,

personality, communication skills, leadership qualities, conceptual skills etc.

4. Social and psychological characteristics : such as emotional ability, human

skills, flexibility, social adaptability in human relationships etc.

JOB DESIGN
14 Human Resource Management (T.Y.B.Com.) (Sem. – VI)

Job design refers to integrating job responsibilities and qualifications that are
required to perform the same. Job design matches the requirements of the job
with human qualities required to do the job. It involves conscious efforts to
organise tasks, duties and responsibilities into a unit of work to achieve
certain objectives.

Job design is the process of :

 deciding the contents of the job.

 deciding methods to carry out the job.

 fixing the duties and responsibilities of the job.

 deciding the relationships between the job holder and his superiors,
subordinates and colleagues.

Job design is done specifically to reduce the mechanical aspects of the job
and make sure that the employee derives satisfaction from the assigned roles and
responsibilities.

Job design can be defined as "a process which integrates work contents
(tasks, functions, relationships), the reward (intrinsic and extrinsic) and the
qualifications required (skills, knowledge, abilities) for each job in a way that meet
the needs of the employees and the organization."

According to Micheal Armstrong, "Job design is the process of deciding on the

contents of a job in terms of its duties and responsibilities, on the methods to be
used in carrying out the job, in terms of techniques, systems and procedures and
on the relationships that should exist between the job holder and his superior,
subordinates and colleagues."

Techniques of Job Design

The techniques of job design are explained as under :

1. Job simplification

Under this method, the job is simplified by breaking it down into small
sub-parts. Then, each part of the job is assigned to a worker who does the
same task over and over again. This enables the worker to gain proficiency in
doing the repetitive task. This increases the productivity of workers and in turn
Human Resource Management 15

profits of the organisation. The training costs of such simplified jobs are virtually nil
because very low level of skill is required to do these simplified jobs.

However, due to the repetitive job, workers feel boredom. Monotony is created
in the work. On the whole, the quality and quantity of output may get adversely
affected. Thus, the company may not always reap the benefits of task
specialization due to work simplification.

2. Job rotation

One solution to boredom in work is job rotation. Job rotation implies moving of
employees from one job to another without any change in the job. In other
words, the employee performs different jobs, but of the same nature.

The advantages of job rotation are :

 It removes boredom.

 It broadens employee’s knowledge and skill.

 Employees become competent in several jobs rather only one.

However, job rotation suffers from certain disadvantages also :

 Frequent shifting of employees across the jobs causes interruption in the

job routine.

 The employees who look for more challenging assignments may still feel
frustrated.

3. Job enlargement

Job enlargement involves increasing the scope of job of an employee by

adding more tasks to it. This is a horizontal expansion in a job. Thus, the job
remains the same, but becomes of a larger scale than before. Job enlargement
has the following advantages :

 Job enlargement expands job scope and gives variety of tasks to the job
holder.

 Job enlargement reduces boredom and monotony by providing the

employee more variety of tasks in the job. Thus, it helps to increase
interest in work and efficiency.

 It trains and develops more versatile employees.

16 Human Resource Management (T.Y.B.Com.) (Sem. – VI)

However, job enlargement may not be sufficient to motivate the employee as

nature of work remains the same. It does not increase the depth of a job. Enlarged
jobs require longer training period as there are more tasks to be performed.

4. Job enrichment

Many employers traditionally believed that money was the only true motivating
factor for employees. However, workers today like to work and to be appreciated
for the work they do. One of the ways to get this done is by Job enrichment.

Job enrichment is a way to motivate employees by giving them increased

responsibility and variety in their jobs. It is a vertical expansion of a job by
adding more responsibility and freedom to do it. Job enrichment increases job
depth, which refers to the degree of control employees have over their work. It
involves designing a job in such a way that it provides the workers greater
autonomy for planning and controlling his own performance. It seeks to improve
tasks, efficiency and human satisfaction. Job enrichment can improve the quality of
work output, employee motivation, and satisfaction.

Job enrichment benefits employees and organisation in terms of increased

motivation, performance, job satisfaction, job involvement and reduced absentees.
Further an enriched job can meet certain psychological needs of job holders i.e.
identity, achievement etc. Job enrichment adds status to one’s job.

The limitations are, if the employee does not give due attention to his job, job
enrichment will not have the desired outcomes. Further job enrichment by itself
does not motivate. This must be preceded by the provision of other variables which
contribute to the quality of work life.
Human Resource Management 17

RECRUITMENT

Recruitment is the first step towards the process of procuring human resource
for the organization. It is the process of searching candidates for employment
and stimulating them to apply for jobs in the organization. It is the process of
bringing together those who are offering jobs and those who are seeking jobs. It is
a process where a pool of prospective employees is created and the management
selects the right person for the right job from this pool. It provides a base for the
selection process.

According to Edwin B. Flippo, “Recruitment is the process of searching for

prospective employees and stimulating them to apply jobs in the organisation”.

Sources of Recruitment

The sources of recruitment may be broadly be classified into two

categories. These are internal sources and external sources. The sources
within the organization itself to fill vacant positions are known as the internal
sources of recruitment. Recruiting candidates from the sources outside the
organization are known as the external sources of recruitment. These are
explained as under :

I. Internal sources of recruitment

18 Human Resource Management (T.Y.B.Com.) (Sem. – VI)

Internal sources of recruitment refer to obtaining people for job from inside the
company. These include:

1. Promotions

Business organizations generally follow the practice of filling higher jobs by

promoting employees from lower jobs. Promotion leads to shifting an employee to
a higher position, carrying higher responsibilities, facilities, status and pay. It is a
method of encouraging efficient employees. In some organizations, promotions are
normally given on seniority basis.

2. Transfers

Transfer means shifting of employees from one job to another. There is no

drastic change in the pay, status or responsibilities of the employees.

3. Internal advertisements

Here, the vacancy is advertised on the notice board of the organization. The
existing employees who are interested are asked to apply for the vacancy.

4. Retired managers

Sometimes, companies call back personnel who have retired from the
organization. This is a temporary measure. It is done when the organisation cannot
find a suitable candidate.

5. Recall from long leave

The organization may recall a manager who has gone on a long leave. This is
done when the organization faces a problem which can only be solved by that
particular manager. After he solves the problem, his leave may be extended.

6. Extension of services

It is extending the service of employees by recruiting them again.

7. Catalogue

The organisation can have a catalogue i.e. a list comprising of names of all
employees along with their qualifications, experience, aptitude etc. If a need arises
then the management can peruse through the catalogue to find the right candidate.

8. Recommendation by seniors

The seniors can be instructed to keep track of the performance of juniors and
to record any special skill which they have observed over the years. The seniors
Human Resource Management 19

should then provide feedback to the management about the concerned

subordinates and their capacity and skill.

II. External Sources of Recruitment

External sources of recruitment are those which are outside the organization.
These are explained as under :

1. Management consultants

Some companies make use of management consultants for selecting higher-

level staff such as entry level management trainees and middle level managers.
These consultants act as representative of the employer. They make all the
necessary arrangements for recruitment and selection. In return for their services,
they take a service charge or commission.

2. Advertisements

Advertisements of the vacancy in newspapers and journals are a widely used

source of recruitment. The advertisement gives information about the company,
the job and the required qualities of the candidate. It invites applications from
suitable candidates. This is one of the oldest and most popular methods of
recruitment.

3. Campus recruitment

When companies are in search of fresh graduates or new talent they opt for
campus recruitment. Companies approach colleges, management and technical
institutes, make a presentation about the company and the job and invite
applications.

4. Recruitment at factory gate

This a source of external recruitment in which the applications for vacancies

are presented on bulletin boards outside the factory or at the Gate. This kind of
recruitment is applicable generally where factory workers are to be appointed.
They may be employed whenever a permanent worker is absent.

5. Employment agencies
20 Human Resource Management (T.Y.B.Com.) (Sem. – VI)

Companies may give a contract to employment agencies that search, interview

and obtain the required number of people. The method can be used to obtain lower
level and middle level staff.

6. Employment exchanges

Employment exchanges run by the government are regarded as a good

source of recruitment for unskilled and skilled jobs. In some cases, compulsory
notification of vacancies to employment exchange is required by law.

7. Labour contractors

Manual workers can be recruited through contractors who maintain close

contacts with the sources of such workers. This source is used to recruit labour for
construction jobs.

8. Walk in interview

Another method of recruitment which is gaining importance is the walk in

interview method. An advertisement about the location and time of walk in
interview is given in the newspaper. Candidates are required to directly appear for
the interview and have to bring a copy of their C.V. with them. This method is very
popular among B.P.O and call centers.

9. E-recruiting

E-recruitment is also known as online recruitment. Some companies recruit

employees through e-recruiting. E-recruitment has many benefits like the
candidate can apply online, reduced cost for travelling, decreasing administrative
workload etc.

SELECTION

Process of Selection Selection is the process of choosing the right


person for the right job from a pool of different
Job analysis
 candidates who applied for a certain job.
Advertisement
Steps/Process of Selection

Application blank/form

Written test

Interview

Medical examination
Human Resource Management 21

Employee Selection is the process of putting right men on right job. Following
are the steps involved in the process :

1. Job analysis

The first step in the selection procedure is the job analysis. The HR
department prepares the job description and specification for the jobs which are
vacant.

2. Advertisement

Based on job analysis, the HR department publishes advertisement about the

job in media such as newspapers, internet etc. The advertisement conveys details
about the job and the requirements of candidates.

3. Application blank / form

Application blank is the application form to be filled by the candidate when he

applies for a job in the company. The application blank collects information
consisting of the following :

 Personal details
 Educational qualifications
 Work experience
 Family background
 References etc.
4. Written tests
The applications which have been received are scrutinized by the HR
department and a final list of candidates for written tests is prepared. The purpose
of such tests is to judge the ability, intelligence, capacity and efficiency of the
candidates. The type of test depends upon the nature of job. Some of the tests
include:
 Intelligence test
 Aptitude test
 Personality test
 Performance test
 Stress test
5. Interview
22 Human Resource Management (T.Y.B.Com.) (Sem. – VI)

Candidates who have successfully cleared the test are called for an interview.
Here, there is face to face communication between the candidate and the
interviewers. The main objectives of interviewing are :
 To measure the applicant against the specific requirements of the job.
 To find out the suitability of the candidate.
 To seek more information about the candidate.
6. Reference check
Before the final selection, reference check is done of the prospective
candidate. The candidate is asked to give the name and address of the former
employer and also of two or three persons known to the candidate but not related
to him. These references help to cross check the information provided by the
candidate.
7. Medical examination
The candidates who have successfully cleared the interview are asked to go
for medical examination. The purpose of medical examination is to judge the
general health and physical fitness of the candidate. Candidates who are not
physically fit for the job are rejected.
8. Initial job offer
Candidates who successfully clear the medical exam are given an initial job
offer by the company stating the details regarding salary, terms of employment,
employment bond if any etc. The candidate is given some time to think over the
offer and to accept or reject.
9. Acceptance / Rejection
Candidates who are satisfied with the offer send their acceptance within a
specified time limit to show that they are ready to work with the company.
10. Letter of appointment / Final job offer
Candidates who send their acceptance are given the letter of appointment.
The letter states the name of the job, the salary and other benefits, number of
medical leaves and casual leaves, details of employment bond if any etc. It also
states the date on which the employee is required to report for duties in the
organization.
Human Resource Management 23

Recruitment V/S Selection

Recruitment Selection

1. Meaning : Recruitment is the Selection is the process of choosing

process of searching the candidates the most suitable candidates from
for employment and stimulating those who apply for vacant posts.
them to apply for jobs in the
organization.

2. Purpose : The basis purpose of The basic purpose of selection

recruitment is to attract more process is to choose right candidates
number of candidates to apply for to fill the vacant posts.
vacant posts.

3. Approach : Recruitment is a Selection is a negative process as it

positive process i.e. encouraging involves rejection of the unsuitable
more and more employees to apply. candidates.

4. Steps involved : It is a simple It is a lengthy process. It involves

process. It involves job analysis, issuing ads, conducting tests,
determining sources of recruitment reference check, medical examination
and advertising for vacant posts. and job offer.

5. Cost involved : It is not costly. It is an expensive process.

Expenditure is required mainly for Expenditure is required for testing
advertising vacant posts. candidates and conducting interviews.

6. Time involved : It is a less time This process requires more time.

consuming process.

7. Sequence: It preceeds selection. It follows recruitment.

8. Services of experts : It does not It requires services of experts.

normally require services of experts.

Employment Tests
Many large companies use employment tests for selecting appropriate
24 Human Resource Management (T.Y.B.Com.) (Sem. – VI)

employees. Different types of tests may be administered, depending on the job and
the company. Employment tests aim at gathering information over and above
what is learned through job interviews. These tests help companies to find
out the applicant’s ability, aptitude, intelligence, maturity, personality etc.
Some of the employment tests are explained as under :

Types of employment test

1. Intelligence Test
Intelligence test is conducted to evaluate traits of intelligence of the
candidates. It helps to measure their mental ability, numerical ability, presence of
mind, memory and such other aspects. This test is used for selecting managers.
2. Interest Test
A person who is interested in a job or task does much better than a person
who is not interested in the job. Interest is a factor that contributes to success on
the job. Interest test is conducted to find out whether the candidate is interested in
a particular job or not. It finds out the likes and dislikes of a candidate about his
occupation, hobbies, etc.
3. Trade Tests
Trade tests are those tests which are designed to measure proficiency and
skills already acquired by the candidate through training experience. These are
also known as proficiency or performance tests. There are various jobs that require
specialised skill such as driving, typing, stenography etc. In these jobs, the
candidate is asked to demonstrate his abilities by undergoing trade test. A number
of industrial organisations in India are using this test for the selection of clerical,
supervision managerial and technical personnel.
4. Personality Test
Personality test is conducted to judge the personality of the applicant. These
tests evaluate aspects such as anxiety, self-control, maturity, inter-personal skills,
emotional stability, aggressiveness, capacity to get along, behaviours under stress
and strain, etc. This test is very much essential in case of selection of sales force,
public relation staff, etc. where personality plays an important role.
5. Aptitude Test
Human Resource Management 25

Aptitude test is conducted to find out:

 Whether the candidate has the talent to do a specific job, or
 Whether the candidate has the ability to learn the job after giving him
training.
6. General Knowledge Test
G.K. test is conducted to find out the general awareness of the candidates.
They are asked questions about politics, world affairs, current affairs, etc. It is
assumed that applicants who are good in general knowledge keep in touch with
latest developments.
7. Projective Test
Projective test is conducted to find out how the candidate interprets the
problem or a situation. For e.g. A picture is shown to the candidate, and he is
asked to give his views and opinions about it.

Interview
An interview means face to face interaction between the interviewer and
the candidate so as to obtain desired information from him. It is a purposeful
exchange of ideas, the answering of questions and communication between two or
more persons. A selection interview is a process in which a potential
employee is evaluated by an employer for prospective employment in their
organization. The purpose of an interview is to determine whether or not the
applicant is suitable for the job. The applicant is judged on the basis of his oral
response to oral enquiries.

Types of Interviews
1. Structured Interview
Structured interviews are also called standardized interviews. Here, details of
the interview are decided in advance. The questions to be asked, the order in
which the questions will be asked, the time given to each candidate, the
information to be collected from each candidate, etc. is all decided in advance. In
other words, the structure of the interview is decided in advance. Structured
26 Human Resource Management (T.Y.B.Com.) (Sem. – VI)

interviews are more reliable & valid as all candidates are asked the same
questions.
2. Unstructured Interview
This interview is not planned in detail. The questions to be asked, the
information to be collected from the candidates, etc. are not decided in advance.
No format is set for the interview. The candidates are encouraged to express
themselves about different subjects, based on their expectations, motivations,
background, interests, etc. They are more relaxed in such interviews. Here the
interviewer can make a better judgment of the candidate's personality, potentials,
strengths and weaknesses.
3. Group Interview
Here, groups rather than individuals are interviewed. A group interview is
similar to a group discussion. A topic is given to the group, and they are asked to
discuss it. The candidates are carefully observed for leadership skills, participation
in the group, team playing skills & communication skills. The interviewer tries to
judge the behaviour of each candidate in a group situation. Such interview is based
on the assumption that group behavior displayed is related to potential
performance on the job.
4. Individual Interview
This is a 'One-To-One' Interview. Most interviews are administered one on
one. It is a verbal interaction between two people, the interviewer and the
candidate, for a particular purpose. The purpose of this interview is to match the
candidate with the job.
5. In-Depth Interview
This is a semi-structured interview. The candidate has to give detailed
information about his background, special interest, etc. He also has to give detailed
information about his subject. In-depth interview tries to find out if the candidate is
an expert in his subject or not. Here, the interviewer must have a good
understanding of human behaviour.
6. Stress Interview
Stress interviews aim to find out how a candidate behaves under stressful
situations i.e. whether he loses his temper or gets confused, frightened, nervous or
is frustrated. The interviewer adopts a hostile behaviour towards the candidate. He
Human Resource Management 27

deliberately puts the candidate on the defensive by trying to annoy, embarrass or

frustrate him. He asks questions rapidly, criticizes his answers, interrupts him
frequently, keeps silent for long time, makes derogatory remarks, accuses him of
lying etc. Stress interviews must be handled carefully and skillfully. Such interviews
are useful for jobs where emotional stability & resistance to stress is required.
7. Formal Interview
Formal interview is also called planned interview. It is held in a more formal
atmosphere. The interviewer asks pre-planned questions. It is conducted as per
rules, conventions and practices. These interviews are mechanical but complete in
all respects.
8. Informal Interview
Informal interview is an oral interview which can be arranged at any place.
Different questions are asked to collect the required information from the
candidate. Specific rigid procedure is not followed. It is a friendly interview.
9. Panel Interview
Panel means an interview committee that is appointed for interviewing the
candidates. The panel may include three or five members. In other words, the
interview is conducted by a group of interviewers. They ask questions to the
candidates about different aspects. They give marks to each candidate. The final
decision is taken by all members collectively by rating the candidates. Panel
interview is always better than an interview by one interviewer because in a panel
interview, collective judgement is used for selecting suitable candidates.
10. Appraisal Interview
A performance appraisal interview is the first stage of the performance
appraisal process and involves the employee and his manager sitting face to face
to discuss all aspects of the employee’s performance. Such an interview gives the
manager a chance to explain what he thinks about the employee’s performance. It
also provides the employee with a chance to defend himself against poor
evaluation by the manager. Here, both sides debate and argue the employees’
side of the story as well as the manager’s perception.
11. Exit Interview
When an employee leaves the organisation for any reason, an exit interview is
conducted. Exit interview is taken to find out why the employee is leaving the
28 Human Resource Management (T.Y.B.Com.) (Sem. – VI)

organisation. These interviews are taken to create a good image of the company
in the minds of the employees who are leaving the company.