Introduction to HRM Introduction to HRM People are vital for effective operation of an organization. It is people, not buildings that make a company successful. Assets make things possible but people make things happen. Employees play dual role. First, as a factor of production. And second, it makes other factors operative and productive. People are the most valuable asset of an organization. Yet human assets are virtually never shown on the balance sheet. Nature of People • • • • Characteristics of HR Multiplicity of roles assumed by individuals. A person play many different roles in the society. These roles are conflicting in nature. There is no average person. Two persons are not the same. This is called individual differences. People are heterogeneous. People are dignified. Treat them with respect and dignity. People appreciate as time goes on. People gain more knowledge and experience. Contd. Nature of People Human being should be considered as a whole person. Human is a total person influenced by internal and external factors. His working life is affected by social and family life. People have synergetic ability. The whole is greater than total of its parts. It may be positive or negative. Two plus two can be five or three. People can be motivated. Motivation is the willingness to exert more efforts to achieve organizational goal. People have a desire for involvement. They want to participate in decision making, which affect their interests. They have right to express their views, emotions and sentiments. Contd. Nature of People • People have perceptual differences. Perception is a process through which people interpret and give meaning to an event or environment. People may perceive the same thing differently. A lot of problems may arise because of perceptual differences. These are• Self-serving bias: Attribute own success to internal factors and failure to the external factors. • Selective Perception: People selectively interpret what they see on the basis of their interest, backgrounds and experience. Contd. Nature of People Halo Effect: Drawing a general impression about a person on the basis of a single characteristic. Contrast effect: Evaluation of a person’s characteristics that are affected by comparison with other people recently encountered who rank higher or lower on the same characteristics. Projection: Attributing one’s characteristics to other people. Stereotyping: Judging a person on the basis of one’s perception of the group to which that person belongs. Generalization of characteristics of people on the basis of gender, age, religion, color, race or wealth. Competitive Advantage through People • Productivity can be achieved through people. • People provide organization with the source of competitive advantage. • People are becoming a great differentiating factor. Selection of people who are smarter, better trained, more motivated, and more committed will help to achieve competitive advantage. • Gaining competitive advantage through people requires following guidelines: – Employment security – Selectivity in recruiting Contd. Competitive Advantage through People – – – – – – – – High wages and salaries Incentive pay Employee ownership Employee empowerment and participation Information sharing Training and skills Treat people with respect and dignity Promotion from within. Meaning of Management • Management is knowing exactly what you want men to do and then seeing that they do it in the best and cheapest way. • Management is the process of achieving organizational objectives through engaging in five major functions of Planning, Organizing, Staffing, Leading and Controlling. • The application of planning, organizing, staffing, directing, and controlling functions in the most efficient manner possible to accomplish objectives is known as management. Meaning of Management • Planning: Planning is the projected course of action. It is deciding in advance what is to be done in future. Planning is the design for tomorrow’s action. • Organizing: It is the process of arranging and allocating resources necessary to achieve organizational objectives. Here resources means both human and nonhuman resources. • Staffing: The management function of selecting, placing, training, developing and compensating subordinates Meaning of Management • Leading: Leading is the process of influencing people to have desired behavior necessary to achieve organizational objectives. It is the process of influencing the activities of an individual or group toward accomplishing objectives. • Controlling: It is regulatory function. Controlling ensures that activities are running to the plans made. It is the management functions of checking to determine whether employees are following plans and progress is being made, and taking action to reduce discrepancies. Definition of HRM • Management is getting things done through other people. • Management is nothing but managing people at work. • HRM is a field of management involves planning, organizing, directing, and controlling the functions of procuring, developing, maintaining and motivating a labour force. • It is a process of acquiring, training, appraising, developing and compensating employees, and attending to their labour relations, health and safety and fairness concerns. Functions of HRM • • • • Acquisition Training and Development Motivation Maintenance Acquisition function • It deals with human resource planning. • HR planning is a process through which an organization ensures that it has right types and kinds of people at the right place who are capable of doing their assigned tasks. • Acquisition function includes- recruitment, selection and socialization of employees. • Recruitment is a process of finding and attracting qualified people for job. It is a positive approach because its objective is to encourage Acquisition function more people to apply for jobs. • Selection is a process of hiring suitable people for job. Right person for right job is the main goal of selection. It is a negative approach. • Socialization is a process of getting new employees acquainted with the organization, its culture, rules and regulations, objectives and supervisors and other employees. Training and Development • Employees skills should be developed and they must have up to date knowledge and skills. • It encompasses employee training, education and career development. • Ongoing retraining is necessary to accommodate technological changes. It is a process of acquiring new skills to do job properly. Training changes employees attitudes and behavior. • Development of employee is necessary to prepare organizations for future challenges. Motivation • Another function of HRM is to help employees to exert high energy level. • Motivation function begins with the recognition that individuals are unique and the motivational techniques such as job satisfaction, employee performance appraisal and compensation must reflect the needs of each individual. • Assessing how employees perform their jobs is the focus of performance appraisal. • Compensation rewards people for performing organizational work through pay, incentives and benefits. Maintenance • Function of HRM is to maintain employee commitment and loyalty to the organization. Qualities of HR manager • Personal Attributes: – Initiatives – Depth of perception – Mature judgment – Understanding of human behavior. • Experience and Training: – Experience in psychological aspects – Labour laws – HR management and general management Qualities of HR manager • Professional Attitude: – HR manager must have professional attitude – He must have the acquisition of basic knowledge of the subject and the right mental attitude. Principles of HRM • • • • • • • • • Treat people with respect and dignity Treat people as adults Deal with people as complete individuals Treat all employees with justice Provide people with opportunities for growth and development Make people feel that they are important Rewards should be earned, not given. Do not underestimate the potentials of people. Supply people with all relevant information. Philosophy of HRM • Labour is viewed as a technical factor of production. They are treated as commodity and they can be bought and sold. They are hired and fired at will. It is consistent with theory X. • Labour is viewed as human factor with a lot of positive potentials, so they must be treated with respect and dignity. This is consistent with Theory Y or McGregor.