Essentials of HRM

1. ‘Sundaram Ltd’ is an electronics company in Chandigarh. The top management

plans to open new branches pan India so they want to create a dynamic human
resource department for managing employee functions. You have been appointed
as their VP -of HR. Explain to the top management, what will be the scope of your
department in this expansion. Give some examples in the context of this
company.
Introduction
Sundaram Ltd.'s plan to create a dynamic human resource department for managing
employee functions needs to take note of the following aspects of their pan India
expansion program.

Followings are the scope of your department in this expansion:

Revamping the Workplace Environment
Many organizations today find it hard to implement productivity improvement programs,
improvise the quality of work-life balance, and also improve health and safety at work. In
the past, as experienced, the primary safety and health focus was on the physical work
environment, however, concern about the psychological work environment is emerging
now. Many firms realize that their competitors, as well as a strategic advantage, are
directly impacted when the work environment of employees is below par. Notably, many
organizations like Google are doing all they can to build an open and creative
workplace.

Effective Work Relationships Maintenance

After hiring their required employees, organizations need to take good care of them. In
addition to a healthy & safe environment of compensation, firms must bring forth the
conditions that will make it attractive for employees to stay. For symbolizing this
function, organizations need not only to establish but also to maintain effective working
relationships with their workforce. Employees, over the last many decades, have gained
considerable rights within the workplace. This has resulted in employment decisions
such as layoffs, discharges, and demotions that must be made with adequate care, yet
supplemented with good reasons. Management must remain well versed with employee
rights and never violate them. Having explained this, an HR manager is expected to be
in a very comfortable position to inform managers about these rights.

Globalization of HRM
As the easy exchange of information becomes commonplace, while at the same time
the world becomes more interdependent, it is of paramount significance that HR
managers need to learn from the HR practices, activities, and policies of other
countries. This apart, since organizations have become more global, mandates that
organizations should develop as well as implement HRM policies that can be applied
internationally, and also make them relevant to the workforce from diverse backgrounds
and cultures. After analyzing these eight distinct HR activities and functions
(compensation/motivation, planning, staffing, performance appraisal, improving the
workplace, training, and development, globalization, and relationship building), it is
necessary to view them both independently and together, because many HR functions
directly influence each other.

Planning HR Needs
The planning function of human resource management involves two major activities:
short- and medium range planning and strategic planning. These twin functionalities
include synchronizing HR needs with the strategic mission and the process of planning
the firm. Such strategic objectives may include increasing revenue growth, service or
product diversity, market share, profit margins, planning for financial obligations, etc.
Planning activities are also essential for rightly performing many other critical Human
Resource activities. To exemplify it, HR planning will help the organization better
understand what type of and how many employees the organization will need in the
future. HR planning also addresses how the firm obtains and thereafter trains future
human capital.

How to staff the Organizational Needs

After linking human resource needs to the organization's strategy, positions must be
filled. Staffing involves recruiting job applicants and then selecting the most appropriate
candidates for the available jobs. It should be noted that staffing applies both to internal
candidates (current employees in the firm) and external candidates (candidates not
currently employed by the firm). While engaging in the process of recruitment, it is
important that the organization casts a wide net to ensure a full and fair search for
potential job candidates. Recruiting is an extraordinarily indispensable HR function,
because, if organizations don't attract a wide range of candidates, they will be less
successful in filling the actual needs of the organization. After identifying the candidates,
they must be selected for the identified jobs. Common selection techniques include
interviewing candidates, obtaining completed application forms, formal training
verifications, and reviewing education, administering various informal and formal tests to
determine potential and fit with the organization. All selection procedures must comply
with various pieces of state and central/federal human rights legislation. The selection
process' goal should be to create a match between the requirements of the job and a
candidate's ability.

Motivating and Compensating Employees

Once employees are on their saddles, it mandates them to determine how well they are
performing and thus accord them their due reward. There are many essential aspects of
compensation. To exemplify it, employees are generally rewarded based on the value of
their job responsibilities, their performance, and their contributions. Undoubtedly,
performance-based rewards can increase an employee's motivation to perform, other
forms of compensation are offered simply for being the organizational member. Directly
linked to "performance-based rewards" are often referred to as direct compensation.
However, compensation that is offered simply for being an organizational member, is
often referred to as indirect compensation.

Increasing Human Potential

The HRM field has been experiencing remarkable patronage in both informal and formal
training and developments. Many studies have concluded that many of the millennials,
stepping into the workforce today, are focusing more on their ability to grow and develop
personally than they were earlier found to be engrossed with their direct compensation.
In today's chaotic global environment, many firms use training and development
activities to remain focused.

CONCLUSION
While concluding, performance in one single activity mostly depends on another
performance. It needs to be noted that all HR functions and activities, in most work
environments operate within the constraints of the external and internal environments.
As deliberated, all the above functions should be viewed as a unit; they are interrelated
and subject to a multitude of events and forces that help shape an organization's HR
policies. Finally, to help the firm achieve its strategic and organizational goals, human
resource (HR) practices and policies must be congruent with the organization's overall
strategy--- Sundaram Ltd.'s plan can thus be implemented. All of these can be
considered to be the strategic nature of human resource management.

2. An FMCG company wants to focus on improving the structure of the human

resource department. They have hired you as an HR advisor for this purpose.
Suggest what should be the various activities under the new sub-divisions in the
HR Department. Elaborate them with corporate examples.
Introduction
An FMCG company wants to focus on improving the structure of the human resource
department. They have hired you as an HR advisor for this purpose.As per Gartner
research findings revealed that only 35% of HR leaders agree they have the mix of
data, social-creative skills, and technology-based needed to meet their functions'
requirements. This is relevant in small businesses where one employee may shoulder
all the needs of the organization's human resource management, those are compliance,
payroll, recruiting, tracking vacation days, and employee benefits administration.

The antiquated guideline

To answer the question, "how many internal HR employees does your organization
need to have on staff used to follow a decades-long standard of 100 employees?" But,
research from the AIHR (Academy to Innovate HR) shows that this proportion is
insufficient, hence, the correct number differs due to a variety of factors. The earlier
studies have found that the average HR-to-employee ratio is 2 HR for every 60 staff, but
smaller businesses mostly report higher HR staff ratios. The requirement for HR staff
comes down as the size of employees increases as large organizations tend to have
more HR staff than small businesses mostly follow.
They may necessitate adding HR employees when only the need arises, such as
when: i) · Hitting lengthy and an unexpected growth period
ii) ·Facing complex compliance issues
iii) · Lacking necessary systems and processes
iv) · Having single or multiple remote branches or locations

This is often why small businesses operate without an HR team. Notably, HR software
systems automate tasks such as time tracking and payroll runs, while external sources
can substitute for handling outsourced needs like recruiting. As said above, small
businesses sometimes may not require a dedicated HR employee until their employee
count goes over 200. Nonetheless, a guideline is never to be taken as "the hard and
fast" rule. Your HR hiring plans should depend on your current state of the business.
How you can structure your HR department if & when your business starts growing
beyond the 100 mark -- is being discussed below:

What should be the ideal HR hiring timeline in proportion to your number of

employees?
The president of HR Strategies & Solutions (a consulting firm), Peter Rosen, offers a
more modernized guideline as per his experience. The founder and CEO of consultancy
firm, Reverb, Mikaela Kiner, opines that “If your company is growing, it is better to bring
in a second HR person at the 150 mark. That rate of growth necessitates additional
processes and infrastructure.

Optimization of your structure in the initial stage

If your organization has more than 100 employees and your HR staff/generalist is
finding it difficult to balance everything on their own, you need to hire your second HR
employee. Generally, this gives you two options to structure a swelling HR department.
i) Hiring an HR assistant: The scenario of you becoming the head of HR strategy ---
handling responsibilities like performance management and employee relations should
be handled by an HR assistant. The newly hired HR person has to handle
administrative tasks like managing the HRIS, posting job ads, and filing paperwork.
ii) Hiring a full-time recruiter: The recruit will take over the responsibility of one of the
most challenging HR functions, i.e. staffing. As per the recommendation of Peter Rosen,
this structure is ideal, as it saves a substantial amount of time by using a specialist for
recruiting. Undoubtedly, recruiting demands specialization to hire at a speedy pace
during the stages of organizational growth.
.
Many organizations bring in leadership development and company culture experts when
their employee strength reaches between 50 and 80 because these are vital focus
areas.But these needs too can be outsourced, if they're not on your priority list. Kiner
informs --- You can outsource that while also searching for outside sources.
As your HR department grows, you should hire specialists to entrust some specific HR
functions, viz employee relations or employee benefits; the reason being these
functions will become more complex with the growth.

Rosen further adds that in the context of compensation, outsourcing can sometimes
either be in the form of benefits packages or the form of competitive salary structures.
But Kiner emphasizes the importance of early hiring of experts — even for
compensation. Kiner adds many of the generalists are not truly compensation experts.
Many times you may hire benefits and compensation people who are also often good
with HR systems, given the finding, you can put these all under one person.

After covering compensation, your needs will likely vary by industry. Here is an example
of the pen picture of a six-person HR department.
Rosen notes that in the case of, say, compensation, outsourcing can occasionally result
in competitive salary structures and benefits packages. As per the scenario, the HR
duties are broken down like this :
1) HR director: The HR Director is bestowed with the job of handling the strategic vision
of the HR department, in addition to approving all high-level decisions and s/he also
handles communications with the C-suite.
2) Employee relations manager: S/he looks after the onboarding needs, manages
employee disputes, and coordinates performance management efforts while
recommending policy changes for approval.
3) Recruiting manager: S/he coordinates with hiring managers to parse through
resumes, create job listings, extend offers, and conduct interviews while managing the
applicant tracking system (ATS).
4) Training manager: Department managers remain within their domain of activities to
effectively develop training courses that strengthen skills, also take care of any learning
management platforms, and create assessments and materials.
5) Compensation Manager: Develops compensation structures and competitive pay
within predetermined budgets. Other than these, s/he employee benefits administration
ensures error-free payroll runs and manages core HR software systems.
6) Compliance manager: The manager has to ensure that the company is up-to-date
with all employee, health, and safety regulations, while also undertaking the
responsibilities of necessary employee certifications. (See Figure 4)
The format of the HR department makes sure that all strategic and core HR needs have
a stakeholder, and the flat HR structure allows the HR Director at the top to remain well
aware of important projects and discussions around him/her.

CONCLUSION
Things to keep in mind as you grow
All these above-mentioned five managers (2-6) are under your control, in addition to
them, you may add on many specialists and assistants, as per the requirements. A co-
HR director of 'Sundaram Ltd', you could also have by your side, or decide to break up
their workloads by country or office location.

3. Maria, the HR Head of ‘Aztec Tech Solutions Ltd’ assigned the task of
assessing the human resource planning to the HR Department. However, his
team informed him that this assessment is not going well as they had expected.
Keeping this context in mind, answer the following:
a. Explain the process of human resource planning. Give some examples also.
INTRODUCTION
Human resource planning (HRP) allows enterprises to plan in maintaining a steady
supply of skilled manpower. This is the reason it is also known as workforce planning.
The process is used to help companies evaluate their needs, in addition, to planning to
meet those needs. We are discussing the case of Aztec Tech Solutions Ltd here. HRP
has to be flexible enough so that it can meet short-term staffing challenges and at the
same time it can adapt to changing conditions in the business environment over the
longer term. HRP starts by assessing and auditing the current human resources
capacity.

Human Resource Planning, and its Challenges

The HRP challenges include forces that are often changing in its status, for example --
employees getting promoted, getting sick, or going on vacation, etc. Human Resource
Planning ensures there is the best fit between jobs and workers, avoiding both
surpluses and shortages in the employee pool.
Intending to satisfy their objectives, HR managers need to plan to accomplish the
following: Find as well as attract skilled employees.
1. Deal with conflicts and Cope with absences.
2. Select, train, groom and reward the best of the flock.
3. Promote employees or if it is so, let some of them go.
Investing in HRP is one of the most critical decisions an enterprise can make. Precisely
speaking, a company is only as good as its employees, hence a qualitative level of
employee engagement is desirable for a company's success. If an enterprise has the
best practices in place, and the best employees, it can mean the difference between
productivity and sluggishness, which help in leading a company profitability.
Steps to HRP
There are four broad and general steps involved in the HRP process. In order to arrive
at the end goal, each step needs to be taken in order, which is developing a strategy,
enabling the company to successfully not only find but also retain enough qualified
employees to meet the needs of the company.
Analyzing Labor Supply
The first step of HRP is to identify the company's human resources supply at present. In
this stage, the department of human resources studies the strength of the organization
based on the number of workers, their positions, benefits, skills, qualifications, and
performance levels.
Forecasting Demand of Labor
In this second step, the company requires to outline the future of its employee strength.
Here, the Human Resource Department can consider certain issues like promotions,
layoffs, transfers, and retirements — anything that is connected with the future needs of
a company. The Human Resource Department can also see to the external conditions
that may impact labor demand. The examples are new technology that might either
decrease or increase the need for a workforce.
Balancing Labor Supply & Demand
The third step in the Human Resource Planning process is forecasting the employment
demand. HRD creates an important gap analysis that brings forward the specific needs
to narrow the company's labor demand versus labor supply for the future.
Conclusion
In most of the cases, this analysis having been generated here does help Aztec Tech
Solutions Ltd. in assessing their HRP.
b. Discuss the qualitative methods for Human Resource Demand forecasting that
the company can utilize. Which one do you think is best suited for this company?
Introduction
The process of estimating the future quantity and quality of people required is what is
known as HR (Human Resource) demand forecasting. The basis of the forecast must
be the long-term corporate plan, and annual budget, translated into activity levels for
each department and function. Let us talk about a few of the core factors, which are
helpful to forecast the human resource demand in an organization. These factors can
be easily classified into 3: different sources -- they are as follows:

1. Organizational Decisions
2. Challenges from external environmental
3. Workforce Factors

Challenges from the external environment -- These challenges arise from various
sources like legal, social, political, and technical changes, economic developments, and
competition. To exemplify it, at the time of liberalization (during 1990-1995), the opening
up of the capital market, banking sector reforms, and online trading systems brought in
a massive demand for finance professionals in India. The demand for certain categories
of skills and some specialized manpower is also influenced by changes in political,
social, and legal structure in an economy from time to time. In the same breadth, firms
are adopting the latest technology in automobiles, software, construction, power, etc.,
and have greatly boosted the worth of engineers and technicians during the last couple
of years. Nevertheless, technology is a double-edged weapon and thus its impact on
HR plans is very hard to predict and will surely impact the HRP.

To exemplify it, IT harnessing in Banks, Post and Telegraph Departments, and Railways
may reduce demand in one department (bookkeeping, for instance) while boosting its
applications in another (viz. computer operations) which was always a major change.
High IT applications with all their resulting benefits may compel organizations to go lean
while also suddenly downsizing their workforce as per the market. HRP and
Employment planning under such situations become complex. Forecasting, most of the
time, is more an art than a science, as it can provide exact approximations and not
absolute results and supplements the ever-changing environment in which a company
operates, resulting in this problem.

Decisions of the Organization

HRP has to consider the rest of the organizational sales and production forecasts,
strategic plans, and to be more accurate, new ventures. To exemplify it, estimating
changes in service or product demand, is a basic forecasting concern, as anticipated
changes in the regional or national economy, qualify the planning expert to forecast the
requisite production schedules, and thus they can estimate whether any extra work is
required in the long run. A community hospital can predict internal changes in
organization or administration or technology, to forecast staffing needs like Max
healthcare is right now into the situation, as they are setting up operations at Gurgaon
close by area to Delhi but remarkably notable is, these are workable only if they are
within the setup's financial resources.

Conclusion
Proposed contraction, diversification, or expansion of the organization's activities will
affect the labor demand in general, or for particular skills. This information may be
estimated by competitive analysis, market research, trends in advancements in
technology and so on.
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