HRM-Unit 1

UNIT 1•Meaning, Nature and Scope•Difference between HRM and Personnel Management•HRM functions and objectives•Evolution of HRM environment – external and internal.•Human Resources Development in India: evolution and principles of HRD, HRD Vs. Personnel functions, Role of HR managers•Strategic Human Resource Management : Nature of Strategies and Strategic Management, Strategic Management Process – Environmental Scanning, Strategy Formulation, implementation and evaluation.

CONCEPTS

MANAGEMENT: Accomplishment of organisational objectives by utilizing physical and financial resources through the efforts of Human Resource.

Resources: Factors of production results in conversion of raw material into useful goods /services.

Definition of HRM

According to Leon C.Megission,” HR is the total knowledge,skills,creative abilities, talents and aptitudes of an organization's workforce as well as the values, attitudes and belief of the individuals involved.”

Defined as a art of procuring ,developing and maintaining competent workforce to achieve goals of an organisation in an effective and efficient manner.

HRMHuman Resources help in transforming the lifeless factors of production into useful products.Capable of producing an output that is greater than the sum of inputs.Can help an organisation achieve results quickly, efficiently and effectively.

Process

Competence Building

HR Planning

Recruitment and Selection

Compensation/Remuneration/Wages&Salary admn

Performance

Management

Leadership & Team Building

Managing Corporate

Culture

NATURE OF HRM

Pervasive force Action oriented Individually oriented People oriented Future-oriented Development oriented Integrating mechanism Comprehensive function Continuous process

Scope of HRM

Personnel Aspect: concerned with manpower planning,recruitment,selection,promotion,training and development,incentives,productivity etc.

Welfare Aspect: deals with working conditions and amenities such as canteen,creches,transport,medical assistance,education,recreation facilities.

Industrial Relation Aspects: covers union-management relations, joint consulatation,collective barganing,grievances and settlement of disputes ,etc.

Objectives of HRM

To help the organisation reach its goals To employ the skills and abilities of the workforce

efficiently To provide the organisation with well-trained and

well-motivated employees. To increase to the fullest the employ’s job

satisfaction and self-actualisation To develop and maintain a quality of work life. To communicate HR policies to all the employees To be ethically and socially responsive to the

needs of society.

Difference between HRM and Personnel Management

Dimensions Personnel Management

Human Resource Management

Rules Importance of devising clear rules

Can do outlook, impatient with rules

Guide to management action

Procuders Business needs

Key relation Labour Management CustomerSpeed of Decisions Slow FastCommunication Indirect DirectManagerial Task vis-à-vis labour

Monitoring Nurturing

Management Role Transactional Transformational Leadership

Difference between HRM and Personnel Management Cont..

Respect for employees

Labour is treated as a tool which is expendable and replaceable

As assets to be used for the benefits of an organisation, its employees and society as a whole

Job Categories and grades

Many Few

Job Design Divison of Labour Team work

HRM :Functions and Objectives

HRM OBJECTIVES SUPPORTING FUNCTIONS1.)Societal Objectives 1.Legal Compliance

2.Benefits3.Union-Management Relation

2.)Organisational Objectives 1.Human Resource Planning2.Employee Relations3.Selection4.Training and Development5.Appraisal6.Placement7.Assesment

3.)Functional Objectives 1.Appraisal2.Placement3.Assesment

4.)Personal Objectives 1.Training and Development2.Appraisal3.Placement4.Compensation5.Assessment

Importance of HRMHuman Resource Management helps an Organisation and its

people to realise their respective goals thus: At the Enterprise level: Attract and retain talent

Train People for challenging Roles Develop skills and

competencies At the individual level: Promote Team Spirit Growth Opportunities to people

Develop loyalty and Commitment Improve Job Satisfaction At the Society level: Generate Employment

OpportunitiesIncrease Productivity and profit

At the national Level: Enhance Standard of Living

Evolution of HRM Environment

Period Emphasis Status Roles1920-30 Welfare

management Paternalistic practices

Clerical Welfare AdministratorPoliceman

1940-60 Expanding the role to cover Labour,Welfare,Industrial Relations and Personnel Administration

Administrative AppraiserAdvisorMediatorLegal Advisor

1970-1980 Efficiency, Effectiveness dimensions added Emphasis on Human values, aspirations, dignity, usefulness

Development Change AgentIntegratorTrainerEducator

Evolution of HRM Environment Cont….

1990s-Onwards

Incremental Productivity gains through human assests

Proactive,growth oriented

DeveloperCounsellorCoachMentorProblem Solver

Human Resources Development Development is acquisition that are

needed to do the present job, or the future expected job.

The purpose of Human resource Development is to enhance an employee’s capacity to successfully handled greater responsibilities, through formal and informal means.

It is a positive concept in Human Resources Management.

HRD Cont….According to Prof.T.V Rao,HRD is a process by which the

employees of an organisation are helped in a continuous and planned way to (1)acquire or sharpen capabilities required to perform various functions associated with their present or expected future roles (2)Develop their general capabilities as individual and discover and exploit their own inner potential for their own and /or organisational development purposes(3)Develop an organisational culture in which superior-subordinates relationships, team work and collaboration among sub units are strong and contribute to the professional well being, motivation and pride of employees.

In short,HRD aims at helping people to acquire competencies required to perform all their functions effectively and make their organisation do well.

Features of HRD

HRD is a systemHRD is a planned processHRD involves development of

competenciesHRD is an inter-disciplinary conceptHRD improves quality of life

Objectives of HRD HRD,basically ,aims at developing:The capabilities of each employees as an individual;The capabilities of each individual in relation to his or

her present role;The capabilities of each employee in relation to his or

her expected future roles(s);The relationship between each employee and his or

her employers;The team spirit and functioning in every organisational

unit;Collaboration among different units of the organisation;The organisation ‘s overall health and self –renewing

capabilities,which,in turn ,increase the enabling capabilities of individuals,teams and the entire organisation.

Benefits of HRD

Improves the capabilities of people. Improves Team workLeads to greater organisational

effectivenessPerformance related rewards help

employees realise the importance of utilising their skills fully in the service of organisational goals.

Difference between HRD and Personnel

Points of Distinction

Personnel Functional

HRD

Orientation Maintenance Oriented

Development Oriented

Structure An independent function with independent sub-function

Consist of inter-dependent parts

Philosophy Reactive function, responding to the events as and when they take place

Proactive function, tryingto anticipate and get ready with appropriate responses

Responsibility Exclusive responsibility of personnel department

Responsibility of all managers in the organisation

Motivators Emphasis is put on monetary rewards

Emphasis is on higher-order needs such as design jobs with stretch, improve creativity and problem solving skills

Difference between HRD and Personnel cont…..

Personnel Function

HRD

Outcomes Improved performance is the results of improved satisfaction and moral

Better use of human resources leads to improved satisfaction and morale

Aims Tries to improve the efficiency of people and administration

It tries to develop the organisation as a whole and its culture

Evolution of the Concept of HRDThe early part of the century saw a

concern for improved efficiency through careful design of work. Improving employee productivity and efficiency was the next big thing to hit the business world. Recent years have witnessed an increasing towards the quality of working life, product and quality and speedy and efficient delivery of work.

Evolution of the personnel FunctionConcept What’s it all aboutThe Commodity Concept Labour was regarded as a

commodity to be bought and sold. Wages were based on demand and supply. Government did very little to protect workers.

The Factor of Production Concept

Labour is like any other factor of production,viz,money,materials,land etc.Workers are like machine tools.

The Goodwill Concept Welfare measures look safety, first aid, lunch room, rest room will have a positive in productivity.

The Paternalistic Concept/Paternalism

Management must assume a fatherly and protective attitude towards employers. Paternalism does not means merely providing benefits but it means satisfying various needs of the employers just as parents meet the requirements of the children

Evolution of the personnel FunctionHumanitarian Concept To improve productivity,

physical social and psychological needs of workers must be met.As Mayo and other stated, money is less a factor in determining output, than group standards, group incentives and security. The organisation is a social system that has both economic and Social dimensions.

The Human Resource Concept Employees are the most valuable assests of the organisation. There should be a conscious efforts to realise organisational goals by satisfying needs and aspirations of employees.

Evolution of the personnel FunctionThe Emerging Concept:HRD Employees should be

accepted as partner s in the progress of a company. They feeling that the organisation is their own. To this end, managers must offer better quality of life and provide opportunities to people to exploit their potential fully. Their should be opportunities for self-fulfilment in one’s work. The focus should be on Human Resource Development.

HRD Mechanisms or Subsystems The following HRD mechanisms are

currently in use in a development competencies of people and improve the organisational climate :

HRD Mechanisms• Performance Appraisal• Potential Appraisal• Career planning• Training and employee development

HRD Mechanisms or Subsystems cont..• Role Analysis• Job Rotation• Performance Counselling• Job Enrichment• Organisational DevelopmentDiagnosis of the problemPlanning Strategy for changeUse of Change agents Implementing the changesEvaluation

The Contribution of HRDSubsystems to Development Dimensions

Development Dimensions

HRD Subsystem Mechanism

Individual Training Career Planning Potential Appraisal and Development

Feedback and Coaching

performance

Rewards

Individual in the present role

Performance Appraisal

Training Feedback and Performance

CoachingRewards

Individual in regards to likely

future roles

Potential appraisal and Development

Training Performance Appraisal

Feedback and Performance

CoachingDyadic

Relationship Feedback and Performance

Coaching

Performance appraisals

Training

The Contribution of HRDSubsystems to Development Dimensions cont…

Teams & Team Work

Organisational Development

Training Team Rewards

Collaboration among

different units/Teams

Organisational Development

Training

Self-Renewing Capability and

Health of Organisation

Performance Appraisal

Organisational Development

Training

Principles in Designing HRD Systems

Management Support Focus of the HRD System Structure of the HRD

System Functioning of the System

Role of HR Managers“We cannot do today’s Job with yesterday’s

methods and be in business Tomorrow.”Main Purpose of the Manager’s Job• To achieve and Exceed the assigned

objectives by ensuring that each and Every member of the Team achieves and for surpasses his/her respective objectives.

• A good Manger has the capacity to get people of ordinary ability to perform in an extraordinary manner.

Key Responsibilities• Ensuring achievement of assigned Team’s

and individual team member’s objective.• Decision Making• Ensuring his objectives achievement covering

up deficits of anyone in his team.• Focus on Brands/New Products• Distribution Channel Management• Timely Reporting and Feedback• Developing Team Members• Market Development• Market Intelligence• Strong Customer focus –Planning,Monitoring

and Controlling

Key Responsibilities Cont…• Appraising and Reviewing• Necessary Course Corrections• Strong Customer focus

Meaning and Nature Of Strategy According to Glueck and Jauch,”A

strategy is unified, comprehensive and integrated plan designed to ensure that the basic objectives of the enterprise are achieved.”

A strategy is a plan that is unified; it ties all the parts of the enterprise together. A strategy is integrated in the sense that all parts of the plan are compatible with each other and fit together well.

Features of StrategyUsually relates to several areas of

operation of the business. So the strategic decisions are taken by the top management.

Are expected to have a significance impact on the firm’s future growth and prosperity.

Are based on the expected behaviour of forces in the external environment.

Are based mostly on the future scenario,i.e.what is the forecast by management.

Meaning & Nature of Strategic Management

According to A.Sharplin,”Strategic management is the formulation and implementation of plans and carrying out of activities relating to the matters which are of vital,pervasive,or continuing importance to the total organisation.”

Because of the critical role of human resources in enabling the organisation to effectively deals with the external environmental challenges, the human resource management function has been accepted as a strategic partner in the formulation of organisation’s strategies and in the implementation of such strategies through human resource planning ,employment, training ,appraisal and rewarding of personnel.

Features of Strategic Mangement It emphasis the basic mission and goals of the

organisation. It determines the basic policies and programs of

the organisation. It provides a framework for operational planning and day-to-day decision-making.

It provides for coherence in organisation’s policies, decisions and activities over a long period of time.

It deals with the uncertain environment by forecasting opportunities and threats in the environment .

It designs the corporate strategy and oversees its implementation.

Strategic Human Resource Management

Strategic Human Resource Management may be defined as the linking of human resource management with strategic goals and objectives in order to improve business performance and develop organisational culture that fosters innovation and flexibility.

Thus, Strategic HRM means look at human resource functions in line with the business functions of an organisation.

Significance of Strategic PlanningPlan of Action to meet the challenges

of environment in future..Clarifies the objectives of the

organisation towards which its resources will be directed.

It facilities the implementation of long-range plans to achieving organisational objectives.

Helps to predict the outcome of planning.

Is useful to fight competitions in the market and to have control over the market.

Stages In Strategic Management• Determination of Mission or Purpose• Environmental Scanning• Organisational Analysis• Developing Strategic Alternatives• Evaluation of Strategic Alternatives• Choice of Strategic Alternatives or

formulation of Strategy• Implementation of Strategy• Evaluation of Strategy

Stages in Strategic Management Cont… Determination of Mission or Purpose• A long term Vision of what the organisation seeks

to do and the reason why it exists.• Mission is often stated in Abstract terms such

as ,”To provide dependable, standard drugs to the public at low prices”.

• ‘Objectives ‘ and ‘Goals’ have different meaning in management literature

• Objectives are desired states or outcomes whereas Goals are objectives that are scheduled for attainment during the plan period. Thus Objectives are Open-Ended and have no time frame.

Stages in Strategic Management Cont… Environmental Scanning• Diagnostic Phase• External Environment Consists of

Economic,Social,Technological,Market and other forces which affect its functioning.

• The management can develop Environmental Threat and Opportunity Profile (ETOP).

• Information for environment scanning comes from several sources: (a)Verbal information fromCustomers,wholesalers,retails,distributorsetc. (b)Record of Companies ©publication of government, financial institutions and international organisations (d)formal studies conducted by the Strategic planners.

• SWOT analysis

Organisational AnalysisIn order to analyse organisational strength and

weaknesses, it is essentially to know the current domain of the firm. It includes:

Range of the products or services provided by the firm

Geographic coverage of the firm-local,national or international

Firm’s differential advantage A review of financial position, productivity

capacity, marketing effectiveness, the extent of research and development, the human resource skills (Operational,Financial,Managerial Strength)

Developing Strategic Alternatives Involves SWOT analysis After the identification of the

environmental opportunities and threats and the organisational Strength and weaknesses one can reformulate the objective, if needed.

Stages in Strategic Management Cont… Evaluation of Strategic Alternatives Formulation of Strategy: It must

utilise the existing strengths of the organisation to the maximum extent.

Implementation of strategy Evaluation of the strategy

UNIT II

Human Resource Planning:Definition,Purposes,processes

and limiting factors

Some Facts

HRM= People Dimension in Management

HRM has 4 steps:ATMM(Acquisition,Training and Development,Motivation &Maintenance)

Getting and keeping Good People is critical to the success of every organisation whether it be private or Public.

What is HR Planning Human Resource Planning is the process by

which an organization ensures that it has the right number and kind of people, at the right time, capable of effectively and efficiently completing those tasks that will help the organization achieve its overall objectives.

HR/Man Power Planning is the process of acquiring and utilizing human resources in the organization has the right number of employees in the right place at the right time.

Employment planning is the process of formulating plans to fill future opening based on an analysis of the positions that are expected to be open and whether these will be filled by insider or outside candidates.

Definitions of Human Resource PlanningAccording to Vetter," the process by which

management determines how an organisation should move from its current manpower position to its desired manpower position. “

In the word of Coleman," Manpower planning is the process of determining manpower requirements and the means for meeting those requirements in order to carry out the integrated plan of the organisation.”

Nature of Human Resource or Man Power Planning Aims at ascertaining the future manpower

needs of the organisation both in numbers and kinds.

Is an on-going and continuous process Presents an inventory of existing manpower of

the organisation (skilled and untapped talent) Helps in determining the shortfall (or surplus) of

manpower by comparing the total manpower needs with the present supply of manpower.

Plans are made for both long-term or short-term.

Objectives Of Human Resource Planning Forecast personnel requirements: Cope with Changes Use existing manpower productively Promote employees in a systematic

manner To assess the surplus and shortage of

human resources To link Human Resources planning with

organisational planning To determines need of recruitment and

training of personnel.

Why Human Resource Planning is Important?

Linking Business Strategy with operational strategy

HRP is a important process to maintain the link between business strategy and its operation. It follows different procedures including the need to assess the impact of technological changes on new jobs and new skills.

Why Human Resource Planning is Important?

Minimizing the risk of loosingBy forecasting the needs of technical

and other human resources it can be minimize the future risk of loosing. Delay in recognizing human resources might be costly and expensive in the future.

Why Human Resource Planning is Important?

HRP needs for HRDHRP is important for planning the investment in

the development and utilization of human resources. Any investment in the HR activities is considered an investment for the future growth and development of the organization.

(when curriculum has to be changed, required knowledge and skills of teachers/instructors should be developed prior to implement the new curriculum.So,educational institutions have to be aware of that.)

Why Human Resource Planning is Important?

HRP is pro- active, not reactive For solving any sort of future HR

problem HRP is pro-active rather than re-active.

Why Human Resource Planning is Important?

HRP promotes AwarenessHRP promotes the awareness that

human resources activities are equally important at every level of the organization. Both lone and staff managers have to involved in HR planning activities.

Steps in Human Resource Planning Determination of Objectives of Human

Resources Planning Preparation of Current Skill Demand Forecasting(estimating future

manpower needs by references to corporate and functional plans and forecasts of future activity levels.)

• Employment Trend (Stable and Unstable)• Replacement Need• Productivity• Absenteeism• Growth and Expansion

Steps in Human Resource Planning Cont… Supply forecasting• Human Resource Audit• Replacement Chart Gap analysis Action plan for redeployment and redundancyo Redeployments may include the following measures:

Transfer ,Employment in Sister Concerns, Create Projects to accommodate surplus staff, Provide trainings

Redundancy programmes may include the following measures:

o Voluntary Retirement/Golden Hand Shakeo Compulsory Retirement/Iron Hand Shakeo Attritiono Leave of Absence without Pay

Steps in Human Resource Planning Cont… Employment plan

(Recruitment,Selection,Placement,transfer and Promotion).

Training and development program

Human Resource Planning Process

Organisational Objectives,Plans and policies

Human Resource Planning

Forecasting Needs for Human ResourcesForecasting

Needs for Human Resources

Forecasting supply of human resources

Identification of human gap

Surplus Human Resources

Shortage of Human Resources

Action Plans for Bridge gap

Barriers to effective Human Resource Planning Identity Crisis Lack of Support of Top Management Insufficient Initial Efforts Coordination with other Managerial

Functions Expensive and Time Consuming Environmental Uncertainty Conflict between Long-term and Short term

HRP Insufficient Information

Guidelines for Effective Human Resource Planningo Organized Efforto Support of Top Managemento Size of initial Efforto Coordination with other Management

Functionso Integration with Organisational Planso Involvement of Operative Managers

Job Analysis – Job Description, Job Specification.

Some Terms Task: It refers to a distinct work activity with an

identifiable beginning and end,e.g. typing a letter Duty: it means a related sequence of

tasks,e.g.,pickup ,sort and deliver incoming mail. Job: A job may be defined as an assignment of

work calling for a set of duties ,responsibilities and conditions that are different from those of other work assignments. For example, two salesmen who are performing similar duties and who require similar training, experience and personal characteristics would be said to hold the same kind of job through they may be working in widely separated parts of the store. The term “job "describes the contents or duties and locations.

Position: A position is a set of duties and tasks assigned to an individual. A position is personal,i.e.it is represented by a position-holder.

Job Classification: It means grouping of jobs into certain categories on some specified basis such as nature of work performed or the level of pay. It is often used as a simplified method of job analysis.

Job Analysis: It is a systematic analysis of each job for the purpose of collecting information as to what the job –holder does, under what circumstances it is performed and what qualifications are required for doing the job. Job descriptions and job specification are the immediate products of job analysis.

Job Description: It is a statement of the purpose,scope,duties and responsibilities of a specific job.

Job specification: It is a statement which lays down the minimum qualifications, training,

and experience essential foe each job.

Concept of Job AnalysisAccording to Harry L.Wyile,”Job

analysis deals with the anatomy of the job embodying every known and determinable factor including the duties and responsibilities involved in its performance; the conditions under which performance is carried on; the nature of the task; the qualifications required in the worker; and the conditions of employment, such as pay,hours,opportunities and privileges.”

Job Analysis cont…A Job analysis provides the following information: Job Identification: its title Significant Characteristics of a job: its location,

physical setting,supervision,union jurisdiction, hazards and discomforts .

Operations involved in doing the job: Specific operations and tasks that make up an assignment, their relative timing and importance, their simplicity, routine or complexity, the responsibility or safety of others for property,funds,confidence and trust.

Materials and equipments to be used in doing the job:Metals,plastics,grains,milling machines,puch presses and micrometers….

How a job is performed: Nature of Operation-lifting,handling,cleaning,washing,feeding,removing,drilling,driving,setting up and many others;

Required Personnel Attributes: Experience,training,apprenticeship,physical strength,co-ordination,physical demands, mental capabilities,aptitudes,social skills;

Uses of Job Analysis

Human Resource Planning Recruitment Selection Placement and Orientation Training Organisation Audit Job Evaluation Job Design Performance Appraisal Career Planning Safety and Health

Process of Job Analysis Organisational Analysis Obtaining Information About Jobs Selecting Representative Jobs for

Analysis Responsibility for Collecting

Information Collection of Data Developing Job Description Preparing Job Specifications

Techniques Of Data Collection Questionnaires Written Narratives Observations Interviews

Job DescriptionA job description is a written statement of

what the job holders does, how it is done, under what conditions it is done and why it is done.

It describes what the job is all about ,throwing light on job content, environment and conditions of employment. It is descriptive in nature and defines the purpose and scope of a job. The main purpose of writing a job description is to differentiate the job from other jobs and state its outer limits.

ContentsA job description usually covers the following Information:Job Title: Tells about the job title, code number

and the department where it is done.Job Summary: A brief write-up about what the

job is all about.Job Activities: A description of the tasks done,

facilities used etc.Working Condition: The physical environment

of job in terms of heat,light,noise .Social Environment: Size of work group and

interpersonal interactions required to do the job.

Job Specification

Job Specification summarises the human characteristics needed for satisfactory job completion. It tries to describe the key qualifications someone needs to perform the job successfully. It spells out the important attributes of a person in terms of education,experience,skills knowledge and abilities to perform a particular job. For each job description, it is desirable to have a job specification.

Human Resources Information system (HRIS): HR accounting and audit.

Human Resource Information System (HRIS)The Human Resource information Systems (HRIS) is

a method by which an organisation collects, analyses and reports information about people and jobs. It applies to information needs at micro and macro levels.HRIS is basically a data base system that offers important information about employees in a central and accessible planning decisions.

HRIS refers to the system of gathering,classifying,processing,recording and disseminating the information required for efficient and effective management of human resources in the organisation.

Elements of HRIS Recruitment and Selection sub-system Manpower Planning Sub-system Personnel Administration Sub-system Training Sub-system Appraisal Subsystem Maintenance Sub-system Payroll Sub-system Job Analysis Sub-system Personnel Research Sub-System

Benefits of HRIS HRIS can process, store and retrieve

enormous quantities of data in an economical way.

The records can be updated quickly. There is a improved accuracy. HRIS can greatly reduce fragmentation and

duplication of data. Information can be readily manipulated,

merged and disaggregated in response to special and complex demands and presented promptly.

Important uses of a Human Resource Information System

HRIS

HR Planning and Analysis•Organisation Charts•Staffing Needs•Skills Inventories•Turn over analysis•Absenteeism Analysis

•Job Posting•Internal Job Matching•Job description tracking•Workforce utilization•Availability AnalysisHR DEVELOPMENT•Employee Training profile•Training Needs•Succession Planning•Career Interests and Experience

STAFFING•Recruiting Sources•Application Tracking•Job Offer refusal analysis

Compensation and Benefits•Pay Structure•Wages/Salary Administration•Benefits Plans and Usage analysis•Vocation Usage

PERFORMANCE APPRAISAL•Employee Competency Data•Matching Actual performance with standards.

Safety ,Health and Security•Safety Training•Accident Rewards•Employee Health Record

Labour Relations•Union Negotiation Records•Attitude Survey Results•Exit Interview Analysis•Employee Work History

Setting up HRIS

Plan Design Implement Evaluate

Computerised HRISA computerised HRIS is designed to monitor, control

and influence movement of people from the time they join the organisation till the date they decide to leave the organisation. It consists of the following Subsystems:

Recruitment Information: includes advertisement module, applicants profile, appointment and placement data.

Personnel Administration Information: consists of personnel needs of an employee concerning leaves,transfer,promotion,increment etc.

Manpower Planning Information: offers data that could be help Human resource mobilisation,career planning, succession planning, and inputs for skill development.

Computerised HRIS Training information: provides information

for designing course material, arranging need-based training and appraising the training programme,etc.

Health Information: data relating to health, safety and welfare of employees

Appraisal information: consists of performance appraisal information that serves as input for promotions, career and succession planning.

Payroll information: provides data related to wages,salaries,incentives,allowances,benefits,deducations for provident fund etc.

The Costs of Human resources Recruitment Costs: Include advertising, travel

expenses, consultant’s fee, incidental expenses. Selection Costs: Include costs of application forms,

testing and interviewing expenses and other administrative costs.

Orientation Costs: Costs incurred in offering orientation courses to new employees(about the companypolicies,procedures,programmes,rules,regulations,etc.)

Training Costs: Trainer’s Salary, facilities cost, trainees time spent in the programme measured financially, low productivity during training.

Development Costs :Costs incurred in enhancing employee skills and expertise.

HUMAN RESOURCE ACCOUNTING HRA is similar in principles to the

preparation of an accounting statement.HRA thus, shows the investment the organisation makes in its people and how the value of these people change s over time.

Flamhoitz defined HRA as,”accounting for people as an organisational resource. It involve measuring the costs incurred by organisations to recruit,select,hire,train,and develop human assest.It also involves measuring the economic value of people to the organisation. “

ObjectivesAccording to Likert,the Objectives of HRA are: Provide cost and the value information about

acquiring,developing,allocating and maintaing human resource so as to meet organisational goals.

Enable management to effectively monitor the use of human resources.

Find whether human assests are appreciating or depreciating over a period of time.

Assist in the development of effective management practices by classifying the financial consequences of various practices.

Advantages:HRA offers the following advantages:Throws light on the strength and the

weakness of the existing workforce in an organisation. In turns, helps management in recruitment planning, whether to hire people or not.

Provides Valuable feedback to managers regarding the effectiveness of HR policies and practices.

Helps management in taking appropriate decisions regarding the use of human assests in an organisation.

Limitations

It is not easy to value the human assets in an organisation.

HRA is full of measurement problems.

No empirical evidence to support the idea that HRA is an effective tool to measure the economic value of people of value to the organisation.

Human Resource AuditAn audit is a systematic examination

of records to obtain, compile and analyse data for a given period of time for the purpose of identifying weakness and suggesting measures for improvement.

Human Resource Audit may be defined as the examination and evaluation of the personnel activities of an organisation.

Importance of Personnel Audit Increased Managerial awareness of

the value of Human Resources. Better Decisions about people, based

upon Human Resource Audit. Developing new measures of

effective man power utilization. Better Human Resource Planning Enabling a longer time Horizon for

planning and budgeting

Scope Information Forecasting Training Performance Appraisal Management Succession Planning Development of Future Outlook

Objectives of Human Resource Audit To review the management policies and

programmes relating to human resource planning,recruitment,selection,placement,promotion,transfer,training and development of employees, administration of employees compensation plans and welfare schemes ….

To evaluate the extent to which the line managers have implemented the human resources policies and programmes.

To identify the gaps and deficiencies in the policies and programmes as well as in their implementation.

To evaluate the functioning of personnel staff and specialists.

Conduct of Personnel Audit Identifying various officials responsible for

various personnel functions. Identifying indicators, statistical ratios and gross

number in some cases. Examining the variations in time-frame in

comparison with a similar previous corresponding period.

Comparing the variations of different departments during different periods.

Examining the variations of different periods and comparing them with similar units and industries in the same region.

Drawing trend lines, frequency distributions and calculating statistical correlations.

Conduct of Personnel Audit Cont… Preparing and submitting a detailed

report to top management and to managers at appropriate levels for information and necessary actions.

RECRUITING HUMAN RESOURCESIn simple terms, recruitment is understood as

the process of searching and obtaining applicants for jobs, for among whom the right people can be selected.

Recruitment is the process of locating and encouraging potential applicants to apply for existing or anticipated job openings.Recruitment,logically aims at (1)attracting a large number of qualified applicants who are ready to take up the job if it’s offered and (ii) offering enough information for unqualified persons to self-select themselves out

Recruitment ,Recruitment Procedures,Recruitment Methods and Evaluation.

Meaning and Nature of RecruitmentAccording to Dale S.Beach ”Recruitment is the

development and maintenance of adequate manpower resources. It involves the creation of a pool of available labour upon whom the organisation can draw when it needs additional employees.”

According to Roger H.Hawk,” The purposes of a recruitment function are primarily straight forward: to seek out, to evaluate ,obtain commitment from ,place and orient the employees to fill positions, required for the successful conduct of the work of an organisation.

Features of Recruitment A positive function as it seeks to develop a

pool of eligible persons from which most suitable ones can be selected.

Is to locate the sources of people required to meet job requirements and attracting such people to offer themselves for employments in the organisation.

Is a linking activity as it brings together those with job (employer) and those seeking jobs (prospective employees)

Is a process or a series of activities rather than a single act of event.

Is a pervasive function as all the organisations engage in recruiting activity.

Purpose of Recruitment To begin identifying and preparing potential job

applicants who will be appropriate candidates. To increase the pool of candidates at the

minimum cost. To increase the success rate of the selection

process. To increase organizational effectiveness To meet organisations legal and social

obligation. To help reduce the probability that job

applicants, once recruited and selected will leave the organisation only often a short period of time.

Recruitment policyRecruitment policy of an organisation may cover the following areas:• Should be recruitment be centralised or decentralised at

unit levels?• Degree of Emphasis would be placed on recruiting from

inside the organisation or outside the organisation, and different outside sources.

• The weightage that would be given to certain categories of people such s local population, physically handicapped personnel, personnel from scheduled castes/tribes and other backward classes.

• Degree of flexibility with regards to age,sex,qualifications,compensation structure and other service condition.

• The budget for meeting the expenditures incurred in carrying out the recruitment process.

• Evaluation of recruitment process.

Factors Affecting Recruitment Policy

There are a number of factors that affect recruitment. These may be classified into two categories: (1) Internal Factors and (2) External Factors

Internal factors: Organisational ImagePersonnel PoliciesJob AttractivenessUnion InterferenceSize of the organisation

External Factors

Labour Market Unemployment Situation Demographic Factors Legal Factors

Sources Of RecruitmentBasically ,there are two sources of recruitment• Internal Sources,i.e present employees.• External Sources, i.e. workforce outside the

organisationTransfers and PromotionsTransfer involves the shifting of an employee

from one job to another.A Promotion is the transfer of an employee to

a job that pays more money or one that enjoys same preferred status. It leads to carrying higher responsibilities,facilities,status and pay.

Advantages of Internal Recruitment Promotes greater loyalty and morale

among the employees. Encourage self-development among

employees. They look forward to develop skills for rising to higher posts.

Creates a sense of security,stability,and continuity of employment.

It eliminates the chances of hasty decisions. It is a cheaper source of recruitment as

compared to external sources.

Limitations of internal Recruitment When Vacancies are filled through

internal promotions, the scope for fresh blood entering the organisation is reduced.

The employees may become lethargic if they are sure of time bound promotions.

The spirit of competition among the employees may be hampered.

Frequent transfer reduce the overall productivity of the organisation.

External Recruitment

1) Recruitment at Factory Gate2) File for unsolicited Applications3) Advertisement4) University or institute campus5) Employment Exchange6) Employee Referrals7) Labour Contractors8) Head Hunter or Management Consultants9) Telecasting10)E-Recruitment

Advantage of External Recruitment Provides a large number of applicants. Enterprise can expect to get fresh,

talented candidates from outside. This means infusion of new blood and new ideas into the enterprise.

It serves as inducement for the existing employees to show better performance.

Sometimes recruitment from internal sources or promotions creates an atmosphere of jealous feelings in the firm.

Limitations It may cause dissatisfaction and

frustration among the existing employees who aspire for promotion.

Time consuming Costly There is no guarantee that the

enterprise will be able to attract suitable applicants even after advertisement and other steps.

Methods of Recruitment

Direct Method or Channels• Campus Recruitment• Internships• Walk-in Interviews• Telerecruiting• Direct Mail

Methods of Recruitment

Indirect Methods or Channels: it involves dissemination of recruitment message through public media,i.e news papers ,T.V,magazines and radio.

Third Party Channels: Employment agencies and exchange.

Management consultants or professional search firms known as head hunters.

Professional Associations. Placement officers of educational and

technical institutes.

Recruitment EvaluationMost of the big organisations use a mix of both internal

and external sources depending on the availability of originality and initiative within the organisation, need for new blood, focus on seniority in promotions, level of specialization required, impact of recruitment on attitudes of employees,etc.However,the alternatives sources of recruitment can be evaluated and the most appropriate sources can be chosen on the basis of the following criteria:

• Time lag between personnel requisition and placement• Cost per hire for different sources of recruitment• Correlation between sources of recruitment and job

success of the persons selected.• Employee reaction towards different sources of

recruitment.• Surveys and Studies