Course: Human Resource

Management
IB: 205
LECTURE: 1
What is Human Resource?

Human resource is the managerial, scientific, engineering, technical traits and other skills that are
employed in creating, designing and developing organization, managing and operating productive and
service enterprises and institutions. ( I.Werts)

❑ Strategic resource of the firm

❑ Source of competitive advantage

Human population is transformed into human resource or human capital basically through education and
training.
 Components of Human Resource development
paradigm

❑ Productivity
❑ Equity
❑ Sustainability
❑ Empowerment
Human Resource Management (HRM)

Human resource management is about managing people in organization as effectively as

possible for the good of employees, the company and society.
HRM involves the acquisition, retention and development of human resource necessary for
organizational success.
So HRM refers to all dedicated activities that an organization use to affect the behaviors of all
people who work for it because behavior of employees influences…..
❑ profitability
❑ customer satisfaction
❑ and organizational effectiveness.
Differences between Personal management and HRM
Personal management
Personal management means management of
persons/people employed
Personal management deals with the affairs of the
working employees only.
Personal management considers employees as just
one resource.
Employees in personal management is mostly
treated as an economic man, as his services are
exchanged for wage/salary.
Employees are treated as cost center and therefore
management controls the cost of labor.
Personal function is treated as only an auxiliary
function
Human resource management
HRM is the management of employees’ skills,
knowledge, abilities, talents, aptitudes, creativity
etc.
HRM is a comprehensive concept. It includes
planning and forecasting the need for employees as
well
Here HR is not just one resource, it helps other
resources to perform their roles
Employees in HRM is treated not only as an
economic man but also as social and psychological
man.
Employees are treated as profit Centre and
therefore invests capital for human resource
development and future utility
HRM is a strategic management function
Importance of Human Resource Management

Today organizations are characterized by…………….

o Extremely high level of competition
o Hundreds of thousands of small and entrepreneurial firms
o Many nations with low wages and highly skilled workers
o Rapid technological advances
o Dynamic legal, political and social realities
o Changing values and educational standards
o Demand for high quality products and service at low prices.
Importance of Human Resource Management

According to the characteristics the successful organizations need to be……………….

❑ Global
❑ Flatter
❑ Populated by teams
❑ Oriented toward differentiation, producing high value added goods and services, creating
niche markets
❑ Totally quality conscious
❑ Cost conscious
❑ More responsive, concerned about speed
Importance of Human Resource Management

❑ Faster to innovate
❑ Reliant on highly trained and flexible people
❑ Dependent on networks of competencies and partnership
❑ Continually evolving strategies structures, and practices
❑ Concerned about ethics and environment
❑ Concerned about managing diversity
❑ Successful in adjusting to change
❑ Engaged in mergers and acquisitions
Importance of Human Resource Management

And today HRM is getting importance in creating human asset who have leadership skill and
effective in………..
❑ Accepting change
❑ Listening customers
❑ Decentralizing authority
❑ Teaching continuously
❑ Controlling assets
 Goals of HRM: Serving multiple stakeholders

The Organization Customers Shareholders/investors

• Productivity • Quality service • Shareholder return

• Profits • Quality products • Return on sales
• Survival • Speeds, responsiveness • Return on assets
• Adaptability • Low cost • Return on investments
• Competitive advantage • Innovation

Employees Strategic partners Society

• Fair treatment • Suppliers • Legal compliance

• Satisfaction • Joint ventures partner • Social responsibility
• Empowerment • Unions • Ethical management
• Employability • customers • Concern for the environment
• Safety and health
• flexibility
 Activities of Human Resource Management

Every organization from smallest to largest engage in variety of HR activities. HRM includes both formal
policies and everyday practices for managing people and the major activities of HRM are following………….
1) Job analysis: Job analysis is the process of……..
❑ Describing and recording aspects of jobs like purposes, duties and working conditions, responsibilities of
job along with job’s title and the name or designation of the person to whom the employee reports ( Job
description).
❑ Specifying the skills and other requirements necessary to perform the job ( job specification).

2) HR planning: Human resource planning is defined as the process of determining manpower requirements
and the means for meeting those requirements in order to carry out the integrated plan of the organization.
Activities of Human Resource Management

3) Staffing: Staffing basically refers to recruitment and selection.

Recruitment: It is the set of activities used to obtain a pool of qualified job applicants.
Selection: selection is the process of choosing from amongst potentially good candidates, the
most right person for the right kind of job, both for long and short term position.
4) Training and development: Training refers to the process of teaching current employees
the basic skills they need to perform their jobs.
Development: Development is any attempt to improve current or future performance of
employees by imparting knowledge, changing attitudes or increasing skills.
Activities of Human Resource Management

5) Performance appraisal: Performance appraisal refers to a formal, structured way to

measuring, evaluating and influencing an employee.
6) Compensation: Compensation means to counterbalance or to offset or to make up. It
implies an exchange. Thus compensation in management, so far it relates to employees,
involve the assessment of employee contribution in order to distribute fairly and equitably
both monetary and non monetary rewards in exchange for those contributions.
7) Career planning: Career planning is the process of identifying career goals and
establishing activities that must be accomplished to retain these goals.
Activities of Human Resource Management

8) Unionization: A union is the legal body that has authority to negotiate with an employer
on behalf of the employee over wages and working conditions. Unionization is thus an effort
by employees to act as a single unit in dealing with managements over their work.
9) Collective bargaining: Collective bargaining is a method of determining terms and
conditions of employment which utilizes the process of negotiation and agreement between
representatives of management and employees.
The central challenges to Organization

Global
competitive
challenge

Population Unemployment
challenge challenge

Better Social
Workforce
responsibility
diversity challenge Organization challenge

Medical, food,
Ethical challenge
housing challenge

Unknown
challenge
Who is responsible for Managing Human Resource

Managing human resource is not just something to be done by those in the HR department.
Managers are ones responsible for the management of people. The responsible person in
managing human resource are following…………

Human Resource Professional (HR Professional) : HR professionals are those who have
specialized or general knowledge in managing human resources.
Line Manager: Line managers are those directly responsible for producing products or
services through and with employees.
Employee: Employees are the non-managers who take active role in managing HR. Sometime
write their own description, design their job, provide input for their performance appraisal.
These 3 group of players are together called HRM triad.
 Working together in managing HR
Line managers
Include HR professionals in the
formulation and implementation of
business strategies
Work closely with HR professionals
and employees to develop and
implement HR activities
Accept shared responsibility for
managing the HR of the company
Set policies that are supportive of
ethical behavior
HR professionals
Working closely with Line managers
and employees to develop and
implement HR activities
Work with the line managers to link
HR activities to the business
Work with employees to help them
voice their concerns to management
Develop policies and practices to
support ethical conduct
Employees
Work closely with line managers and
HR professionals to develop and
implement HR activities
Accept responsibility for managing
their own behavior and careers in
organizations
Recognize the need for flexibility and
adaptability
Realize their impact on the success of
the company
Current trends of HRM

a) Globalization
b) Workforce diversity
c) Teams and teamwork
d) Small business and entrepreneurial firms
e) Combining technical expertise and systematical analysis
 Conclusion

Human resource management is sometimes thought of as an extended

form of personal management and this is not true. In fact HRM is a
paradigm shift in in people management in the organizational context.