Unit-3: Introduction to Human Resource Management 3.

UNIT – III
INTRODUCTION TO HUMAN RESOURCE MANAGEMENT

HUMAN RESOURCE MANAGEMENT

Human Resource Management is the process of recruitment, selection of employee,
providing proper orientation and induction, providing proper training and the developing
skills, assessment of employee (performance of appraisal), providing proper compensation
and benefits, motivating, maintaining proper relations with labour and with trade unions,
maintaining employee’s safety, welfare and health by complying with labour laws of concern
state or country.
Human Resource Management (HRM) is a relatively new approach to managing
people in any organisation. People are considered a key resource in this approach. Human
Resource Management is a process, which consists of four main activities, namely,
acquisition, development, motivation, as well as maintenance of human resources. Human
Resource Management is responsible for maintaining good human relations in the
organisation. It is also concerned with the development of individuals and achieving
integration of goals of the organisation and those of the individuals. Many great scholars had
defined human resource management in different ways and with different words, but the core
meaning of the human resource management deals with how to manage people or employees
in the organization.

Definition:
• Edwin Flippo defines- HRM as “planning, organizing, directing, controlling of
procurement, development, compensation, integration, maintenance and separation of
human resources to the end that individual, organizational and social objectives are
achieved.”
• The National Institute of Personnel Management (NIPM) of India defined human
resources management as “that part of management which is concerned with people at
work and with their relationship within an enterprise. Its aim is to bring together and
develop into an effective organization of the men and women who make up enterprise
and having regard for the well – being of the individuals and of working groups, to
enable them to make their best contribution to its success”.

OBJECTIVES OF HRM
The main purpose of human resource management is to accomplish organizational
goals. Therefore, the resources are mobilized to achieve such goals. Some importance and
objectives of human resource management are as follows:
1. Effective Utilization of Resources: Human resource management ensures the
effective utilization of resources. HRM teaches how to utilize human and non-human
resources so that the goals can be achieved. Organization aiming to utilize their
resources efficiently invites the HR department to formulate required objectives and
policies.
2. Organizational Structure: Organizational structure defines the working relationship
between employees and management. It defines and assigns the task for each
employee working in the organization. The task is to be performed within the given
constraints. It also defines positions, rights and duties, accountability and
Unit-3: Introduction to Human Resource Management 3.2

responsibility, and other working relationships. The human resource management

system provides the required information to timely and accurately. Hence, human
resource management helps to maintain the organizational structure.
3. Development of Human Resources: Human resource management provides a
favourable environment for employees so that people working in organization can
work creatively. This ultimately helps them to develop their creative knowledge,
ability and skill. To develop the personality of employees, human resource
management organizes training and development campaigns which provide an
opportunity for employees to enhance their calibre to work.
4. Respect for Human Beings: Another importance of human resource management is
to provide a respectful environment for each employee. Human resource management
provides with required means and facilitates employee along with appropriate respect
because the dominating tendency develops that will result organizational crisis.
Hence, all of them should get proper respect at work. HRM focuses on developing
good working relationships among workers and managers in an organization. So,
good human resource management system helps for respecting the employees.
5. Goal Harmony: Human resource management bridges the gap between individual
goal and organizational goal-thereby resulting in good harmony. If goal difference
occurs, the employees will not be willing to perform well. Hence, a proper match
between individual goal and the organizational goal should be there in order to utilize
organizational resources effectively and efficiently.
6. Employee Satisfaction: Human resource management provides a series of facilities
and opportunities to employees for their career development. This leads to job
satisfaction and commitment. When the employees are provided with every kind of
facilities and opportunities, they will be satisfied with their work performance.
7. Employee Discipline and Moral: Human resource management tries to promote
employee discipline and moral through performance-based incentives. It creates a
healthy and friendly working environment through appropriate work design and
assignment of jobs.
8. Organizational Productivity: Human resource management focuses on achieving
higher production and most effective utilization of available resources. This leads to
an enhancement in organizational goals and objectives.

FUNCTIONS OF HR MANAGER
Human Resource Department is established in most of the organizations, under the
charge of an executive known as HR/Personnel Manager. This department plays an important
role in the efficient management of human resources. The personnel department gives
assistance and provides service to all other departments on personnel matters. Though the
human resource manager is a staff officer in relation to other departments of the enterprise, he
has a line authority to get orders executed within his department. The functions of HR
management is categorised as Managerial, Operative and Advisory functions.

Managerial Functions:
The Human Resource Manager is a part of organisational management. So, he must
perform the basic managerial functions of planning, organising, directing and controlling in
relation to his department. Their functions are:
1. Planning: To get things done through the subordinates, a manager must plan ahead.
Planning is necessary to determine the goals of the organisation and lay down policies
Unit-3: Introduction to Human Resource Management 3.3

and procedures to reach the goals. For a human resource manager, planning means the
determination of personnel programs that will contribute to the goals of the enterprise,
i.e., anticipating vacancies, planning job requirements, job descriptions and
determination of the sources of recruitment.
2. Organizing: Once the human resource manager has established objectives and
developed plans and programs to reach them, he must design and develop
organisation structure to carry out the various operations.The organization structure
basically includes grouping of personnel activity logically into functions or positions,
assignment of different functions to different individuals, the delegation of authority
according to the tasks assigned and responsibilities involved, and coordination of
activities of different individuals.
3. Directing: The plans are to be pure into effect by people. But how smoothly the plans
are implemented depends on the motivation of people. The direction function of the
personnel manager involves encouraging people to work willingly and effectively for
the goals of the enterprise. The personnel manager can motivate the employees in an
organisation through career planning, salary administration, ensuring employee
morale, developing cordial relationships and provision of safety requirements and
welfare of employees.
4. Controlling: Controlling is concerned with the regulation of activities in accordance
with the plans, which in turn have been formulated on the basis of the objectives of
the organisation. Thus, controlling involves the observation and comparison of results
with the standards and correction of deviations that may occur. Controlling helps the
personnel manager to evaluate the control of the performance of the personnel
department in terms of various operative functions. It involves performance appraisal,
critical examination of personnel records and statistics and personnel audit.

Operative Functions:
The operative functions are those tasks or duties which are specifically entrusted to
the human resource or personnel department. These are concerned with employment,
development, compensation, integration and maintenance of personnel of the organisation.
The operative functions of the human resource department:
1. Manpower Planning: Manpower planning is also known as human resource planning
(HRP). It may be defined as a rational method of accessing the requirements of
human resources at a different level in an organization. It ends with proposals of
recruitment, retention or dismissal. Through planning management strives to have the
right number and the right kinds of people at the right places, at the right time, to do
things which result in both the organisation and the individual receiving the maximum
long-range benefit.
2. Recruitment: Recruitment means a search of the prospective employee to suit the job
requirements as represented by job specification–a technique of job analysis. When
the manpower plan reveals the need for additional people in organization, the
manager has to initiate the search for employees and see that they apply for jobs in the
organization. Recruitment is often called Positive function. At this stage, the
applications are invited for further scrutiny and short-listing.
3. Selection: The process of identifying the most suitable persons for the organization is
called selection. It is also called Negative function because here applications are
screened and shortlisted on the basis of selection criteria. The main purpose is to
choose the right person for the right job. The selection procedure, depending upon the
cadre, involves different stages. The organizations are free to formulate their own
selection procedures, as there is no standard practice.
Unit-3: Introduction to Human Resource Management 3.4

4. Training and Development skills: Training is an organized activity for increasing

the knowledge and skills of people for a definite purpose. It involves systematic
procedures for transferring technical know-how to the employees so as to increase
their knowledge and skills for doing specific jobs with proficiency. In other words,
the trainees acquire technical knowledge, skills and problem-solving ability by
undergoing the training programme. The training methods differ into two categories:
On-the-job training methods and Off-the-job training Methods.
5. Placement: After training the employee is placed in his position under the charge of a
manager. The new recruit is allowed to exercise full authority and is held responsible
for the results. Placement involves assigning a specific job to each one of the selected
candidates. However, placement is not as simple as it looks. It involves striking a fit
between the requirements of a job and the qualifications of a candidate. The
importance of placement is that it reduces employee’s turnover, absenteeism,
accidents and dissatisfactions.
6. Salary and Wage Administration: Compensation is the HRM function that deals
with every type of reward individual receive in the exchange for performing
organizational tasks. It is the major cost of doing the business for many organizations.
It is the chief reason why some individuals seek employment. The objective of the
compensation is to create a system of rewards that is equitable to the employers and
employees alike. The salary constitutes of the basic salary, dearness allowance (DA),
house rent allowance (HRA) and other allowances. Some other benefits include profit
sharing, bonus, leave travel concessions, medical reimbursement, provident fund,
gratuity, group insurance schemes, pension, accident compensation, leave with pay,
educational allowance, etc.
7. Promotion: It refers to the advancement of an employee to a job with higher
authority and responsibility. It may also carry better compensation package. It is
viewed as a means of filling up vacancies in the organization from time to time. The
basis of promotion could be merit or seniority depending upon the nature and level of
job. As and when the vacancies arise, the qualified staff may get the promotion.
8. Transfer: It is a lateral shift that moves an individual employee from one position to
another i.e. it may be in the same department or to a different department or location.
To optimize human resources at different locations or departments, employees are
transferred from one location to another. It is also viewed as a tool for punishing the
employee in case of misconduct or misbehaviour. It does not involve any change in
salary, duties and responsibilities.
9. Separation: It refers to the termination of employment i.e. the employee is separated
from his job. It is also called as dismissal. In case of misconduct or misbehaviour or
where the employee is not in a position to improve his performance, he is terminated.

Advisory Functions:
Human resource manager has specialized education and training in managing human
resources. He is an expert in his area and so can give advice on matters relating to human
resources of the organization. He offers his advice to:
1. Advised to Top Management: Personnel manager advises the top management in
formulation and evaluation of personnel programs, policies and procedures. He also
gives advice for achieving and maintaining good human relations and high employee
morale.
2. Advised to Departmental Heads: Personnel manager offers advice to the heads of
various departments on matters such as manpower planning, job analysis and design,
recruitment and selection, placement, training, performance appraisal, etc.
Unit-3: Introduction to Human Resource Management 3.5

JOB ANALYSIS

Job Analysis is a procedure by which pertinent information is obtained about a job,

i.e., it is a detailed and systematic study of information relating to the operation and
responsibilities of a specific job. Job analysis is the process of determining, by observation
and study, and reporting pertinent information relating to the nature of a specific job. It is the
determination of the tasks which comprise the job and of the skills, knowledge, abilities and
responsibilities required of the worker for a successful performance and which differentiate
one job from all others.
According to George R. Terry, ―the make-up of a job, its relation to other jobs, and
its requirements for competent performance are essential information needed for a job
analysis. Information on a job may be obtained from three principal sources :
(a) From the employees who actually perform a job;
(b) From other employees such as supervisors and foremen who watch the workers doing
a job and thereby acquire knowledge about it; and
(c) From outside observers specially appointed to watch employees performing a job.
Such outside persons are called the trade job analysts. Sometimes, special job
reviewing committees are also established.

Methods of Job Analysis

There four methods or approaches are utilised in analysing jobs. These are :
1. Personal Observation: The materials and equipment used, the working conditions
and probable hazards, and an understanding of what the work involves are the facts
which should be known by an analyst.
2. Sending out of Questionnaires: This method is usually employed by engineering
consultants. Properly drafted questionnaires are sent out to job-holders for completion
and are returned to supervisors. However, the information received is often
unorganised and incoherent. The idea in issuing questionnaire is to elicit the necessary
information from job-holders so that any error may first be discussed with the
employee and, after due corrections, may be submitted to the job analyst.
3. Maintenance of Long Records: The employee maintains a daily record of duties he
performs, marking the time at which each task is started and finished. But this system
is incomplete, for it does not give us any desirable data on supervisor relationship, the
equipment used, and working conditions. Moreover, it is timeconsuming.
4. Personal Interviews: Personal interviews may be held by the analyst with the
employees, and answers to relevant questions may be recorded. But the method is
time-consuming and costly.

Purposes and Uses of Job Analysis

A comprehensive job analysis programme is an essential ingredient of sound
personnel management. It is fundamental to manpower management programmes because the
results of job analysis are widely used throughout the programmes. The information provided
by job analysis is useful, if not essential, in almost every phase of employee relations.
1. Organisation and Manpower Planning: It is helpful in organisational planning for it
defines labour needs in concrete terms and coordinates the activities of the work
force, and clearly divides duties and responsibilities.
2. Recruitment and Selection: By indicating the specific requirements of each job (i.e.,
the skills and knowledge), it provides a realistic basis for hiring, training, placement,
transfer and promotion of personnel.
Unit-3: Introduction to Human Resource Management 3.6

3. Wage and Salary Administration: By indicating the qualifications required for

doing specified jobs and the risks and hazards involved in its performance, it helps in
salary and wage administration. Job analysis is used as a foundation for job
evaluation.
4. Job Re-engineering: Job analysis provides information which enables us to change
jobs in order to permit their being manned by personnel with specific characteristics
and qualifications. This takes two forms :
• Industrial Engineering Activity, which is concerned with operational analysis,
motion study, work simplification methods and improvements in the place of
work and its measurement, and aims at improving efficiency, reducing unit labour
costs, and establishing the production standard which the employee is expected to
meet; and
• Human Engineering Activity, which takes into consideration human capabilities,
both physical and psychological, and prepares the ground for complex operations
of industrial administration, increased efficiency and better productivity.
5. Employee Training and Management Development: Job analysis provides the
necessary information to the management of training and development programmes.
It helps it to determine the content and subject-matter of in-training courses. It also
helps in checking application information, interviewing, weighing test results, and in
checking references.
6. Performance Appraisal: It helps in establishing clear-cut standards which may be
compared with the actual contribution of each individual.
7. Health and Safety: It provides an opportunity for indentifying hazardous conditions
and unhealthy environmental factors so that corrective measures may be taken to
minimise and avoid the possibility of accidents.

JOB DESIGN

Job analysis helps in developing appropriate design of job to improve efficiency and
satisfaction. 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
jobholder and his superiors, subordinates and colleagues. It is a deliberate and systematic
attempt to structure the technical and social aspects of work so as to improve technical
efficiency and job satisfaction. Job design is an attempt to create a match between job
requirements and human attributes. It involves both organising the components of the job and
the interaction patterns among the members of a work group.
The main objective of job design is to integrate the needs of the individual and the
requirements of the organisation. Needs of employees include job satisfaction in terms of
interest, challenge and achievement. Organisational requirements refer to high productivity,
technical efficiency and quality of work. Today, educated and creative employees demand
well-designed jobs. Therefore, increasing attempts are being made to redesign jobs so as to
improve the quality of working life. A systematic body of knowledge on the designing of jobs
has been developed after the Industrial Revolution and the large scale enterprises.

Approaches to Job Design

The main approaches to job design are described below:
1. Classical Approach: Also known as Engineering approach, it was developed by F.W.
Taylor and his associates. The principles of scientific management formed the basis
Unit-3: Introduction to Human Resource Management 3.7

for designing jobs in most Organisations. These principles focus on planning,

standardising and improving human effort at the operative level in order to maximise
productivity. In the words of Taylor, ―the work of every workman is fully planned
out by the management at least one day in advance and each man receives in most
cases complete written instructions, describing in detail the task which he is to
accomplish. This task specifies not only what is to be done but how it is to be done
and the exact time allowed for doing it. Jobs designed on the basis of classical
approach are not appropriate in the modern environment characterised by increased
awareness, improved education and rising expectations of workforce.

2. Behavioural Approach: The findings of Elton Mayo, Frederick Herzberg and other
human relations experts led to search for alternative ways of designing jobs so as to
avoid the dysfunctional consequences of standardisation and simplification. Job
redesign, work structuring, job enrichment, participative system and other similar
strategies were developed to improve the quality of work life. The aim of all these
attempts is to design jobs which will not only ensure technical efficiency but will
satisfy social and psychological needs of workers. The most popular behavioural
approach to job redesign is the Job characteristics model of Hackman and Oldham.
This model is based on the assumption that three key psychological stats of a
jobholder determine his motivation, satisfaction and performance on the job.

MANPOWER / HUMAN RESOURCE PLANNING

Human resource is the most important asset of an organization. Human resources
planning is an important managerial function. It ensures the right type of people, in the right
number, at the right time and place, who are trained and motivated to do the right kind of
work at the right time, there is generally a shortage of suitable persons. The enterprise will
estimate its manpower requirements and then find out the sources from which the needs will
be met. If required manpower is not available then the work will suffer. Developing countries
are suffering from a shortage of trained managers. Job opportunities are available in these
countries but properly trained personnel are not available. These countries try to import
trained skillfrom other countries.
In order to cope up with the human resource requirements, an enterprise will have to
plan in advance its needs and the sources. The terms of human resource planning and
manpower planning are generally used interchangeably. Human resource planning is not a
substitute for manpower planning. Rather the latter is a part of the former i.e., manpower
planning is integrated with human resource planning.

Definition:
According to E.W. Vetter, human resource planning is “the process by which a
management determines how an organization should make from its current manpower
position to its desired manpower position.
Through planning, management strives to have the right number and the right kind of
people at the right places, at the right time to do things which result in both the organization
and the individual receiving the maximum long-range benefit.”
Unit-3: Introduction to Human Resource Management 3.8

Features of Human Resource Planning:

The following features of human resource planning can be derived:
1. Well Defined Objectives: Enterprise’s objectives and goals in its strategic planning
and operating planning may form the objectives of human resource planning. Human
resource needs are planned on the basis of company’s goals. Besides, human resource
planning has its own objectives like developing human resources, updating technical
expertise, career planning of individual executives and people, ensuring the better
commitment of people and so on.
2. Determining Human Resource Needs: Human resource plan must incorporate the
human resource needs of the enterprise. The thinking will have to be done in advance
so that the persons are available at a time when they are required. For this purpose, an
enterprise will have to undertake recruiting, selecting and training process also.
3. Keeping Manpower Inventory: It includes the inventory of present manpower in the
organization. The executive should know the persons who will be available to him for
undertaking higher responsibilities in the near future.
4. Adjusting Demand and Supply: Manpower needs have to be planned well in
advance as suitable persons are available in future. If sufficient persons will not be
available in future then efforts should be made to start the recruitment process well in
advance. The demand and supply of personnel should be planned in advance.
5. Creating Proper Work Environment: Besides estimating and employing personnel,
human resource planning also ensures that working conditions are created. Employees
should like to work in the organisation and they should get proper job satisfaction.

Importance of Manpower Planning:

1. Key to managerial functions: The four managerial functions, i.e., planning,
organizing, directing and controlling are based upon the manpower. Human resources
help in the implementation of all these managerial activities. Therefore, staffing
becomes key to all managerial functions.
2. Efficient utilization: Efficient management of personnel becomes an important
function in the industrialization world of today. The setting of large-scale enterprises
requires management of large-scale manpower. It can be effectively done through a
staffing function.
3. Motivation: Staffing function not only includes putting right men on right job but it
also comprises of motivational programmes, i.e., incentive plans to be framed for
further participation and employment of employees in a concern. Therefore, all types
of incentive plans become an integral part of the staffing function.
4. Better human relations: A concern can stabilize itself if human relations develop
and are strong. Human relations become strong trough effective control, clear
communication, effective supervision and leadership in a concern. Staffing function
also looks after training and development of the workforce which leads to co-
operation and better human relations.
5. Higher productivity: Productivity level increases when resources are utilized in the
best possible manner. Higher productivity is a result of minimum wastage of time,
money, efforts and energies. This is possible through the staffing and its related
activities (Performance appraisal, training and development, remuneration).
Unit-3: Introduction to Human Resource Management 3.9

Manpower Planning Process (HRP Process):

Human resource planning refers to a process by which companies ensure that they
have the right number and kinds of people at the right place, at the right time; capable of
performing different jobs efficiently. Planning the use of human resources is an important
function in every organisation. A rational estimate to various categories of personnel in the
organisation is an important aspect of human resource planning.
HRP involves the following process:

Corporate Goals and Resources

----------------------------------------------------------------------------------------------------------------
Departmental targets and resources
Department
Identify and Analyze workload
Level
Access manpower requirements

Succession plan Employee Turnover Employee Development

Shortage or Surplus of Staff

----------------------------------------------------------------------------------------------------------------
Formulate strategies for
Succession, Recruitment, Redundancy, Employee Development

Top Management Review

Company
Level Financial Clearance

Management Approval
---------------------------------------------------------------------------------------------------------------
Action Plans

Evaluation and Control

Steps in Human Resource Planning:

1. The manpower planning starts with identifying the corporate goals and resources.
2. Each department has to identify their targets and resources allocated.
3. Analyze their work load and access manpower requirements.
4. They have to formulate succession plan, training programs for employee
development and employee turnover.
5. In case of additional staff required, plan for recruitment and in case of surplus,
discharge them.
6. Accordingly the proposals are made to top management. They review the
proposal.
7. After getting clearance, the departments evaluate the financial terms.
8. After approval, they formulate action plans to implement the decisions.
9. Action plans are evaluated and controlled in terms of department requirements
and financial constraints.
Unit-3: Introduction to Human Resource Management 3.10

RECRUITMENT
Recruitment is a positive process of searching for prospective employees and
stimulating them to apply for jobs in the organisation. When more persons apply for jobs then
there will be scope for recruiting better persons.The job-seekers too, on the other hand, are in
search of organisations offering them employment.Recruitment is a linkage activity bringing
together those with jobs and those seeking jobs. In simple words, the term recruitment refers
to discovering the source from where potential employees may be selected. The scientific
recruitment process leads to higher productivity, better wages, high morale,reduction in
labour turnover and enhanced reputation. It stimulates people to apply for jobs; hence itis a
positive process.
Definition:
• According to Edwin B. Flippo, “It is a process of searching for prospective employees
and stimulating and encouraging them to apply for jobs in an organisation.” He
further elaborates it,terming it both negative and positive.
• In the words of Dale Yoder, Recruitment is the process to “discover the sources of
manpower to meet the requirements of the staffing schedule and to employ effective
measures for attracting that manpower in adequate numbers to facilitate effective
selection of an efficient working force.”

Objectives of Recruitment:
1. To attract people with multi-dimensional skills and experiences that suit the present
and future organizational strategies,
2. To induct outsiders with a new perspective to lead the company,
3. To infuse fresh blood at all levels of the organization,
4. To develop an organizational culture that attracts competent people to the company,
5. To search or headhunt/head pouch people whose skills fit the company’s values,
6. To devise methodologies for assessing psychological traits,
7. To seek out non-conventional development grounds of talent,
8. To search for talent globally and not just within the company,
9. To design entry, pay that competes on quality but not on quantum,
10. To anticipate and find people for positions that do not exist yet.

SOURCES OF RECRUITMENT:
The searching for suitable candidates and informing them about the openings in the
enterprise is the most important aspect of recruitment process.The candidates may be
available inside or outside the organisation. Basically, there are two sources of recruitment
i.e., internal and external sources

Internal Sources:
Best employees can be found within the organization when a vacancy arises in the
organisation, it may be given to an employee who is already on the pay-roll. Internal sources
include promotion, transfer and in certain cases demotion. When a higher post is given to a
deserving employee, it motivates all other employees of the organisation to work hard. The
employees can be informed of such a vacancy by internal advertisement.The methods of
Internal Sources are:
1. Transfers: Transfer involves shifting of persons from present jobs to other similar
jobs. These do not involve any change in rank, responsibility or prestige. The numbers
of persons do not increase with transfers.
Unit-3: Introduction to Human Resource Management 3.11

2. Promotions: Promotions refer to shifting of persons to positions carrying better

prestige, higher responsibility sand more pay. The higher positions falling vacant may
be filled up from within the organisation. Promotion does not increase the number of
persons in the organisation.A person going to get a higher position will vacate his
present position. The promotion will motivate employees to improve their
performance so that they can also get promotion.
3. Present Employees: The present employees of concern are informed about likely
vacant positions. The employees recommend their relations or persons are intimately
known to them. The persons recommended by the employees may be generally
suitable for the jobs because they know the requirements of various positions. The
existing employees take full responsibility for those recommended by them and also
ensure their proper behaviour and performance.

Advantages of Internal Sources:

1. Improves morale: When an employee from inside the organisation is given the
higher post, it helps in increasing the morale of all employees. Generally, every
employee expects promotion to a higher post carrying more status and pay.
2. No Error in Selection: When an employee is selected from inside, there is the least
possibility of errors in selection since every company maintains a complete record of
its employees and can judge them in a better manner.
3. Promotes Loyalty: It promotes loyalty among the employees as they feel secure on
account of chances of advancement.
4. No Hasty Decision: The chances of hasty decisions are completely eliminated as the
existing employees are well-tried and can be relied upon.
5. The economy in Training Costs: The existing employees are fully aware of the
operating procedures and policies of the organisation. The existing employees require
little training and it brings economy in training costs.
6. Self-Development: It encourages self-development among the employees as they can
look forward to occupying higher posts.

Disadvantages of Internal Sources:

1. It discourages capable persons from outside to join the concern.
2. It is possible that the requisite number of persons possessing qualifications for the
vacant posts may not be available in the organisation.
3. For posts requiring innovations and creative thinking, this method of recruitment
cannot be followed.
4. If the only seniority is the criterion for promotion, then the person filling the vacant
post may not be really capable.

External Sources:
All organisations have to use external sources for recruitment to higher positions
when existing employees are not suitable. More persons are needed when expansions are
undertaken. The external sources are:
1. Advertisement: It is a method of recruitment frequently used for skilled workers,
clerical and higher staff. Advertisement can be given in newspapers and professional
journals. These advertisements attract applicants in large number of highly variable
quality.Preparing good advertisement is a specialized task. If a company wants to
conceal its name, a ‘blind advertisement’ may be given asking the applicants to apply
to Post Bag or Box Number or to some advertising agency.
Unit-3: Introduction to Human Resource Management 3.12

2. Employment Exchanges: Employment exchanges in India are run by the

Government. For unskilled, semi-skilled, skilled, clerical posts etc., it is often used as
a source of recruitment. In certain cases, it has been made obligatory for the business
concerns to notify their vacancies to the employment exchange. In the past, employers
used to turn to these agencies only as a last resort. The job-seekers and job-givers are
brought into contact by the employment exchanges.
3. Camus Recruitment: Direct recruitment from educational institutions for certain
jobs (i.e. placement) which require technical or professional qualification has become
a common practice. A close liaison between the company and educational institutions
helps in getting suitable candidates. The students are spotted during the course of their
studies. Junior level executives or managerial trainees may be recruited in this way.
4. Recommendation of Existing Employees: The present employees know both the
company and the candidate is recommended. Hence, some companies encourage their
existing employees to assist them in getting applications from persons who are known
to them. In certain cases, rewards may also be given if candidates recommended by
them are actually selected by the company. If recommendation leads to favouritism,
it will impair the morale of employees.
5. Factory Gates: Certain workers present themselves at the factory gate every day for
employment. This method of recruitment is very popular in India for unskilled or
semi-skilled labour. The desirable candidates are selected by the first-line supervisors.
The major disadvantage of this system is that the person selected may not be suitable
for the vacancy.
6. Casual Callers: That personnel who casually come to the company for employment
may also be considered for the vacant post. It is most economical method of
recruitment. In advanced countries, this method of recruitment is very popular.
7. Central Application File: A file of past applicants who were not selected earlier may
be maintained. In order to keep the file alive, applications in the files must be checked
at periodical intervals.
8. Labour Unions: In certain occupations like construction, hotels, maritime industry
etc., all recruits usually come from unions. It is advantageous from the management
points of view because it saves expenses of recruitment. However, in other
industries,unions may be asked to recommend candidates either as a goodwill gesture
or as a courtesy towards the union.
9. Labour Contractors: This method of recruitment is still prevalent in India for hiring
unskilled and semi-skilled workers in brick kiln industry. The contractors keep
themselves in touch with the labour and bring the workers at the places where they are
required. They get commission for the number of persons supplied by them.
10. Former Employees: In case employees have been laid off or have left the factory at
their own, they may be taken back if they are interested in joining the concern
(provided their record is good).
11. Other Sources: Apart from these major sources of external recruitment, there are
certainly other sources which are exploited by companies from time to time. These
include special lectures delivered by recruiter indifferent institutions, though
apparently these lectures do not pertain to recruitment directly.

Merits of External Sources:

1. Availability of Suitable Persons: Internal sources, sometimes, may not be able to
supply suitable persons from within. External sources do give a wide choice to the
management. A large number of applicants may be willing to join the organisation.
They will also be suitable as per the requirements of skill, training and education.
Unit-3: Introduction to Human Resource Management 3.13

2. Brings New Ideas: The selection of persons from outside sources will have the
benefit of new ideas. The persons having experience in other concerns will be able to
suggest new things and methods. This will keep the organisation in a competitive
position.
3. Economical: This method of recruitment can prove to be economical because new
employees are already trained and experienced and do not require much training for
jobs.

Demerits of External Sources:

1. Demoralization: When a new person from outside joins the organization, present
employees may feel demoralized because these positions might have gone to them.
There can be a heart burning among old employees. Some employees may even leave
the enterprise and go for better avenues in other concerns.
2. Lack of Co-Operation: The old staff may not co-operate with the new employees
because they feel that their right has been snatched away by them. This problem will
be acute especially when persons for higher positions are recruited from outside.
3. Expensive: The process of recruiting from outside is very expensive. It starts with
inserting costly advertisements in the media and then arranging written tests and
conducting interviews. In spite of all this if suitable persons are not available, then the
whole process will have to be repeated.
4. The problem of Maladjustment: There may be a possibility that the new entrants
have not been able to adjust in the new environment. They may not temperamentally
adjust with the new persons. In such cases either the persons may leave themselves or
management may have to replace them. These things have adverse effect on the
working of the organisation.

SELECTION
Selection is a process of measurement, decision making and evaluation. The goal of a
selection system is to bring in to the organisation individuals who will perform well on the
job. To have an accurate and fair selection system, an organisation must use reliable and valid
measures of job applicant characteristics. In addition, a good selection system must include a
means of combining information about applicant characteristics in a rational way and
producing correct hire and no-hire decisions.
Organisations vary in the complexity of their selection system. Some merely skim
applications blanks and conduct a brief, informal interviews, whereas others take to resting,
repeated interviewing, and background checks and so on. Although the latter system is
costlier per applicant, many benefits are realised from careful, thorough selection. An
organisation needs to have members who are both skilled and motivated to perform their
roles. Thus, selection may greatly increase training and monitoring costs, whereas spending
more on the selection process will reduce these post-hire expenses.

Purpose of Selection
The purpose of selection is to pick up the most suitable persons who would match the
requirements of the job and the organization. The emphasis in selection is, therefore, on the
optimal match between the person and the job. Some organizations emphasize on selecting
the Right Person for the Right Job. Here the Job is usually considered constant (through Jobs
and Job context do undergo changes over time) and the person is sought to be fitted into the
Unit-3: Introduction to Human Resource Management 3.14

job. Creative and innovative organizations, instead, seek to find the Right Job for Right
Person.
A secondary objective in selection could be to choose the best person available.
However, there could be a real problem with such an objective if the Job is not appropriate
for the person concerned. It may become difficult for organizations to retain their best people
in jobs that do not offer opportunities for them to harness their potential; instead they may
lead to problems of monotony, boredom and frustration among Individuals and increased and
increased turnover of staff for the organization.

Selection Process
The selection process begins with the job specification. The more dearly and precisely
it is done the less would be the number of qualified applicants. Suppose the purpose is to
select management trainees. If the qualification prescribed is MBA, the number of applicants
may be in hundred. If the qualification is graduation in any discipline, the number of
applicants may be in thousand. Of course, the reputation of the firm, the job content,
compensation package, location, etc. also influence the response to any, recruitment drive.
But Job specification does plays an important role m deciding the quantity and, quality of
response from prospective applicants.
The selection process covers the period from the job specification and initial contact
with the applicant to his final acceptance or rejection. The successive stages in the selection
process are referred to as hurdles that the applicants should cross. Not all selection processes,
however, include all these stages. The complexity of the selection process usually increases
with the increase in the skill level and job level (responsibility and accountability) of the
position for which selection is being made. The sequencing of the hurdles also may vary from
job to job and organization to organization.

1. Initial Screening: The initial screening and/or preliminary interview is done to limit
the costs of selection by letting only suitable candidates go through the further stages
in selection. At this stage, usually a junior executive either screens all enquiries for
positions against specified norms (in terms of age, qualifications and experience)
through preliminary interview where information is exchanged about the job, the
applicant and the, mutual expectations of the individual and the organization. If the
organization finds the candidate suitable, an application form, prescribed for the
purpose, is given to these candidates to fill in and submit.
2. Application Form: The application form is usually designed to obtain information on
various aspects, of the applicant‘s social, demographic, academic and work-related
background and references. The forms may vary for different positions some
organizations may not have any form specially designed instead, ask the candidates to
write applications on a plain sheet.
3. Written Examination: The organizations have to conduct written examination for
the qualified candidates after they are screened on the basis of the application blanks
so as to measure the candidate’s ability in arithmetical calculations, to know the
candidates’ attitude towards the job, to measure the candidates’ aptitude, reasoning,
knowledge in various disciplines, general knowledge and English language.
4. Preliminary Interview: The preliminary interview is to solicit necessary information
from the prospective applicants and to assess the applicant’s suitability to the job.
This may be conducted by an assistant in the personnel department. The information
thus provided by the candidate may be related to the job or personal specifications
regarding education, experience, salary expected, aptitude towards the job, age,
physical appearance and other physical requirements etc. Thus, preliminary interview
Unit-3: Introduction to Human Resource Management 3.15

is useful as a process of eliminating the undesirable and unsuitable candidates. If a

candidate satisfied the job requirements regarding most of the areas, he may be
selected for further process.
5. Tests: A test is a sample of an aspect of an individual‘s behavior, performance or
attitude. It also provides a systematic basis for comparing the behavior, performance
or attitude of two or more persons. Tests serve as a screening device and provide
supplementary inputs in selection decisions. Their value lies in the. fact that they
serve additional predictors intended to make selection decision more apt and
accurate.
(a) Intelligence Tests: These are tests to measure one‘s intellect or qualities of
understanding. They are also referred to as tests of mental ability. The traits of
intelligence measured include: reasoning, verbal and non-verbal fluency,
comprehension, numerical, memory and spatial relations ability.
(b) Aptitude Tests: Aptitude refers to one‘s natural propensity or talent or ability to
acquire a particular skill. While intelligence is a general trait, aptitude refers to a
more specific capacity or potential. It could relate to mechanical dexterity,
clerical, linguistic, musical academic etc.
(c) Achievement Tests: These are proficiency tests to measure one‘s skill or acquired
knowledge. The paper and pencil tests may seek to test a person‘s knowledge
about a particular subject. But there is no guarantee that a person who knows most
also performs best. Work sample tests or performance test using actual task and
working conditions (then simulated one‘s) provide standardized measures of
behavior to assess the ability to perform than merely the ability to know. Work
sample tests are most appropriate for testing abilities in such skills as typing,
stenography and technical trades. Work sample tests bear demonstrable
relationship between test content and job performance.
(d) PIP Tests: PIP tests are those which seek to measure one‘s personality, interest
and preferences. These tests are designed to understand the relationship between
any one of these and certain types of jobs.
(e) Projective Tests: These tests expect the candidates to interpret problems or
situations. Responses to stimuli will be based on the individual‘s values, beliefs
and motives. Thematic Apperception Test and Rorschach Ink Blot Test are
examples of projective tests. In Thematic Apperception Test a photograph is
shown to, the candidate who is then asked to interpret it. The test administrator
will draw inferences about the candidate‘s values, beliefs and motives from an
analyis of such interpretation.
(f) Other Tests: A vide variety of other tests also are used though less frequently and
in rare instances instances. These include polygraphy (literally mean many pens),
graphology (handwriting analysis), non-verbal communication tests (gestures,
body movement, eye-contact, etc an lie-detector tests.
6. Final Interview: The interview is a selection technique which enables the employer
to view the total individual and directly appraise him and his behaviour. It is a method
by which an idea about an applicant’s personality can be obtained by face-to-face
contact. It tries to achieve an exacting appraisal of an applicant, his previous
experience, education, training and family backgrounds. An effective interview
involves preparation for the interview, physical sitting, conducting interview, closing
interview and evaluation of results.
7. Medical Examination: After the selection decision is made, the candidate is required
to undergo a physical fitness test. A job offer is often contingent upon the candidate
passing the physical examination.
Unit-3: Introduction to Human Resource Management 3.16

8. Reference Checks: Reference checks and background checks are conducted to verify
the information provided by the candidates. Reference checks can be through formal
letters, telephone conversations. However, it is merely a formality and selections
decisions are seldom affected by it.
9. Selection Decision: After obtaining all the information, the most critical step is the
selection decision is to be made. The final decision has to be made out of applicants
who have passed preliminary interviews, tests, final interviews and reference checks.
The views of line managers are considered generally because it is the line manager
who is responsible for the performance of the new employee.
10. Job offer: The next step in the selection process is job offer to those applicants who
have crossed all the previous hurdles. It is made by way of letter of appointment.
11. Employment: After the job offer is made and candidates accept the offer, certain
documents need to be executed by the employer and the candidate. Here is a need to
prepare a formal contract of employment, containing written contractual terms of
employment etc.

PLACEMENT AND INDUCTION

Placement:
Placement involves assigning a specific job to each one of the selected candidates.
However, placement is not simple as it looks. It involves striking a fit between the
requirements of a job and the qualifications of a candidate. Pigors and Myers has defined
placement as, “the determination of the job to which an accepted candidate is to be assigned,
and his assignment to that job. It is a matching of what the supervisor has reason to think he
can do with the job demands and what he offers in the form of pay rolls, companionship”
with others, promotional possibilities etc. The importance of placement is that it reduces
employees turnover, absenteeism, accidents and dissatisfactions.

Induction:
Induction is introducing the new employee to work surrounding and people already
working there. In other words, induction is the process of receiving and welcoming
anemployee when he first joins a company, and giving him basic information he needs to
settle down quickly and happily and start work. According to R.P. Billimoria, “induction is a
technique by which a new employee is rehabilitated into the changed surroundings and
introduced to the practices, policies and purposes of the organizations.”

Objectives of Induction
1. To reduce the initial anxiety which all new entrants feel, when they join a new job
in a new organization.
2. To familiarize the new employees with the job, people, work-place, work
environment and the organization.
3. To facilitate outsider – insider transition in an integrated manner.
4. To reduce the cultural shock faced in the new organization and
5. To reduce exploitation by the unscrupulous co-workers.

Formal induction
Formal induction is a planned programme carried out to integrate the new entrant into
the organization. Following are the contents in a formal induction programme:
1. Brief history of the organization.
Unit-3: Introduction to Human Resource Management 3.17

2. Organizational mission, vision, objectives and philosophies.

3. Policies and procedures of the organization.
4. Rules and regulations of the organization.
5. Organization structure and authority relationship.
6. Terms and conditions of the job including remuneration, working hours, holidays,
promotional avenues etc.
7. Welfare measures like subsidized canteen, transport and recreation facilities.
8. Safety measures.

Information induction
In this system, the immediate job supervisor conducts the induction programme for
the new entrant. He briefs the new corner about the job, the department, routine and
introduces to the colleagues, and various sections.

REVIEW QUESTIONS
1. Define HRM? Discuss the objective of HRM.
2. Explain the principles of human resource management.
3. Discuss the different functions of HR manager.
4. Define manpower planning. Explain its features and importance.
5. Discuss the steps involved in the HR planning process.
6. What is job analyais? State the purpose and uses of job analysis.
7. Describe job design? Discuss the approaches of job design.
8. Define recruitment? Explain the various sources of recruitment.
9. What is meant by selection? Discuss the process involved in leaves.
10. Discuss the importance of placement and induction.