HRM Lecture Chapter 1 3

Human Resource Management
(Mgmt 1015) Lecture note
Prepared By
Getnet Hunegnaw Kebede
Lecture, Management Department, College ofBusiness
and Economics, Bahir Dar University, Bahir Dar, Ethiopia
May 2016

Chapter One: Overview of HRM
Outlines of the chapter
1.1 Definition of HRM
1.2 Evolution of HRM
1.3 Importance of HRM
1.4 Objectives of HRM

Objectives of the chapter
After completing this chapter, students should be able
to:
Define HRM
Describe the importance of HRM
Identify the objectives of HRM

What is Human Resource Management?

No single definition of HRM.
Some of the the definitions include:
Human Resource Management
emcompasses those activities designed
to provide for and coordinate the
human resources of an organization.
Traditionally know as ”personnel
administration” or ”personnel
management”
1.1 Definition of HRM

Cont’d…
HRM is the process of managing people in a
company as well as managing the existing
inter-personal relationships
According to Invancevich and Glueck : “HRM
is concerned with the most effective use of
people to achieve organizational and individual
goals.”

Cont’d…
According to Milkovich and Boudreau : “HRM
is a series of integrated decisions that form the
employment relationship; their quality
contributes to the ability of the organizations
and the employees to achieve their objectives.”
Thus, HRM is a combination of people-
oriented management practices that views
employees as assets, not costs

What are the Features of Human Resource
Management?

Features of Human Resource Management
•A process
•Pervasive
•Action Oriented
•People Oriented
•Development Oriented
•Integrating Mechanism
•Comprehensive Function
•Inter-disciplinary Function
•Continuous Function

1.2 Evolution of HRM
The history of HR management goes back to the
19th
century, when some industrial companies in
the US and Europe employed welfare officers to
look the wellbeing of workers. Its growth is in the
following ways:
1917-18: 1st
formal personnel department created
to deal with tight labor market, high turnover,
waste and inefficiency, widespread strikes, union
growth, government intervention, etc.
1920’s: HR used to “win” worker cooperation,
through ensuring job security, benefits, etc.

Cont’d…
1930’-50’s: “Human Relations” recognizes that
there are psychological and social influences to
worker satisfaction, cooperation, performance.
1960’s: Work design, rather than communication
and cooperation in groups, is the key to increase
worker motivation. Small work group design leads
to greater employee effort, group work provides
opportunities for “self-actualization”; work is more
interesting and fulfilling.

cont’d…
1970’s: Quality of Work Life (QWL):
emphasis on the value of human resources.
PM becomes HRM.
1990’s-Present: TQM, reengineering,
globalization, strategic HR, new
technologies, diversity, holistic approaches
to HR, and HRM models emerged.

1.3 Importance of HRM
Managers at all levels must concern
themselves with HRM because people in an
organization is the most important resource.
Thus, it is important for
analyzing jobs,
planning labor needs,
selecting employees,
orienting and training employees,
managing compensation, communicating (which
includes counseling and disciplining),
maintaining employee commitment to perform
organizational goals.

Cont’d…
ensuring fair treatment;
appraising performance;
ensuring employee health and safety;
building and maintaining good
employee/labor relations;
 handling complaints and grievances;
and
 ensuring compliance with human
rights,

1.4 Objectives of HRM
The primary objective of HRM is to ensure the
availability of competent and willing workforce to
an organization. Specifically,
We can classify the objectives into four major
category as:

1) Societal Objectives: seek to ensure that the
organization becomes socially responsible to the
needs and challenges of the society.
2) Organizational Objectives: it recognizes the role
of HRM in bringing about organizational
effectiveness. The HR department exists to serve
the rest of the organization.
3) Functional Objectives: is to maintain the
department’s contribution at a level appropriate to
the organization’s needs.
4) Personnel Objectives: it is to assist employees in
achieving their personal goals to enhance the
individual’s contribution. i.e. to maintain, retain and
motivate.

Exercise
Define HRM.
Describe the importance of HRM
Explain the objectives of HRM

CHAPTER TWO
HUMAN RESOURCE MANAGEMENT
ENVIRONMENT

Outline of the chapter
2.1 External Environment
2.2 Internal Environment
2.3 Models of HRM

Chapter objectives
Up on the completion of this chapter, you
are expected to:
•Identify the different internal
environments of human resource
management.
•List the different external environments.
•Distinguish the different models of
human resource management.

What are the different factors that affect
HRM?

2. Context/ environment of HRM
The HRM practices in an organization are
influenced by two broad categories of factors–
External/Environmental factors and
internal/Organizational factors.
2.1 Internal/Organizational factors-emanate
from the organization. It includes:
1. Organization’s Strategy and objectives:
growth rates,
new product development,
 enlargement of market coverage,
diversification

Cont’d…
2.Organizational culture and mgt philosophy-
High Performing Culture
Low Performing Culture
Mgt philosophy(management assumption about
human behavior) and leadership style
3. Organizational size and structure
level of centralization and decentralization
4. Organizational Financial Position
financial strength to pay better and attract qualified
employees

Cont’d…
5. Work force factors: the demand for human
resources is affected by retirements, terminations,
death, leaves of absence, lateness, rate of
maternity leave, sick leave, etc. Organization of
6. The nature of the jobs & tasks: - the simplicity/
complexity of the tasks in the job

2.2 External /Environmental factors-are
outside the control of an organization
• Economic Environment-Economic conditions
affect supply and demand for products and
services. i.e. Healthy or downturn economic
condition impacts on labor force-employment
rate either high or low
•Labor Market Conditions-availability of mkt for
labor either local or international

Cont’d…
•Legal Environment-acts of parliament; and
contract law, which governs collective
agreements and individual employment
contracts, mandatory payments such as workers’
compensation, employment insurance, pension
plans.
• Technological Environment-robotics and
computer-aided design/ computer-aided
manufacturing, have eliminated many blue-collar
jobs, replacing them with fewer but more highly
skilled jobs.
•

Cont’d…
Socio-cultural Environment/demographic
trend and workforce diversity-population growth,
age, educational level, values, etc.
Labor union-govern wages, benefits, working
conditions, and job security.
Globalization-integration: numbers of
multinational corporations—firms that conduct a
business outside the country

2.3 Human Resource Management Models
The following are the common school of
models/thoughts:
1. Harvard Model: The model outlines four HR
policy areas:
Human resource flows: recruitment, selection,
placement, promotion, appraisal and assessment,
promotion, termination, etc.
Reward systems: pay systems, motivation, etc.

Cont’d...
Employee influence: delegated levels of authority,
responsibility, power.
Work systems: design of work and alignment of
people.
These in turn lead to the 'four C's' of HR policies
that have to be achieved.
•Commitment
•Congruence /unity
•Competence
•Cost effectiveness

2. Guest’s Model: This model is identified by
David Guest’s (1997). It has six dimensions:
•HRM strategy
•HRM practices
•HRM outcomes
•Behavior outcomes
•Performance outcomes
•Financial outcomes

3. Best Practice Model
This model is based on the assumption that there is
a set of best HRM practices that are universal in
the sense that they are best in any situation. These
are
•employment security/safety;
•selective hiring;
•self-managed teams;
•high compensation;
• provision of training and motivated workforce;
•reduction of status difference;
•Sharing of information.

4. Soft and Hard model of HRM
Soft HRM (high commitment and employee
oriented) emphasizes the importance of high
commitment, learning/training, leadership; human
resources are valuable assets, not variable costs.
Hard HRM (low commitment and task oriented
model) on the other hand emphasizes with cost
control and different strategies, especially in
business processes like downsizing, lowering the
wages, shortening comfort breaks, etc. (Storey,
1989).

5. Patterson’s Model: According to this
model, human resource practice can improve
organizational performance by:
•Increasing employees skill and ability
•Promoting positive attitude and increasing
motivation,
•Providing employees with expanded
responsibilities so that they make full use of
their skills and abilities.

6. Best Fit/Contingency Model: The model is also
known as Michigan model or the 'matching model'.
The model has a harder, less humanistic edge,
holding that employees are resources in the same
way as any other resources and have to be
managed in a similar manner as equipment and
raw materials

Exercise
State the different models of HRM
Explain the external /environmental factors of
HRM
List the internal /organizational factors of HRM

CHAPTER THREE
JOB ANALYSIS AND HUMAN RESOURCE
PLANNING

Outlines of the chapter
Definition of job analysis
Steps of job analysis
Ways of collecting job analysis information
Meaning of human resource planning
 Importance of human resource planning
Steps in human resource planning
Factors affecting human resource planning

Chapter objectives
Up on the completion of this chapter, you are
expected to:
•Define job analysis
•Identify the steps of job analysis
•Discuss the meaning of human resource
planning
•Explain the importance of human resource
planning
•Distinguish factors affecting human resource
planning
•List human resource planning processes

3.1 Definition of Job Analysis
Job Analysis is the procedure through which you
determine the duties of the positions to be staffed
and the characteristics of people who should be
hired for them. The analysis produces information
used for developing job descriptions and job
specifications.

Cont’d…
Job analysis should provide information such as
•Job title.
• Department.
• Supervision required.
• Job description
•Types of material and equipment used.
•Educational qualification and experience
requirements.
• Mental and physical requirements.
• Working conditions (inside, outside, hot, cold,
dry, wet, noisy, dirty, etc.).

3.1.1Steps in Job Analysis
Analyzing a job requires the following six steps.
These are:
1.Determine the use of job analysis information
2.Collection of background information
3.Selection of jobs for analysis
4.Collection of job analysis data
5.Processing the information
6.Develop a job description and job specification

Cont’d…
Job description is a written
statement/outline that describes the activities
and responsibilities of the job. It includes
Job identification
Job summary
Duties and responsibilities
Relation to other jobs
materials used
Working conditions
Social environment

Cont’d…
On the other hand, job specification is a
statement of the minimum required human
qualities /qualification. It includes:
Physical characteristics
Psychological and social characteristics
Mental Characteristics
Personal Characteristics

3.1.3 Methods of collecting job
analysis information
The most common methods are
Interview-individual, group and
supervisory
Guidelines of interview
Cooperation between job analyst and
supervisor
Making rapport with interviewee
Follow a structured guide/check list
Prepare alternative checklist for non
regular/not frequent activities
Review and verify the data

2.Questionnaire- quick and efficient for large
respondents
3. Observation- useful for observable physical
activity and not appropriate for non-measurable
mental activity.
4. Participant Diary/Logs-keep a diary/log or list of
what they do during the day.

3.1.4 Importance of job analysis information
The major importance of job analysis information
. It is used for:
Performance Appraisal
Compensation
Recruitment and Selection
Training
Ensure Complete Assignment of Duties
Know the gap
etc

3.1.5 Potential problems with job analysis
The major problems that affect job analysis are:
•Lack of top management support.
•Only a single way and source are used for gathering
data
•Supervisor and jobholder do not participate in design
of job analysis procedure.
•No training or motivation exists for jobholders
•Employees are not allowed sufficient time to
complete the analysis
•Activities may be distorted
•Lack of skills, experience
•Lack of information
•Participants fail to critique the job
•etc

3.4 Human Resource Planning
The process by which an organization ensures
that it has the right number and kind of people,
at the right place, at the right time, capable of
effectively and efficiently completing those
tasks that will help the organization achieve its
overall objectives.
- HRP is a process
- It involves determination of needs
- It also takes into account the manpower
availability at a future period.

3.2.2.2 Importance of HRP
HRP is important for a nation, organization and
employees.
1. National importance of HRP-used to adjust different
policies such as agriculture, industry, education,
population, etc.
2. Organizational importance- used to
anticipates the required kind and number of
employees
Anticipate the compensation
Avoid disruption
Offset/reduce uncertainty
Promote equal employment opportunity
Coordinate different activities such as recruitment,
selection, training, etc.

3. Employee importance
Creates more satisfied and better-developed
employees through training, development, transfer,
promotion,
Gain better compensation
Reduce absenteeism, turn over, lay offs

3.2.3 Steps of HRP
The process of HRP broadly involves the following
steps.
1. Estimating the demand for human resource
2. Estimating the supply of human resource
3. Identify the gap/Estimating the net HR
requirement
4. Developing and implementing action plan to fill
the gap between demand and supply.

3.2.4 Factors affecting HRP
The major factors that affect HRP are
Type and strategy of the organization
Organizational growth cycles and planning
 Environmental uncertainties
Time horizons-short/long term
Type and quality of forecasting information
Nature of jobs being filled
Outsourcing/off loading work

HRM Lecture Chapter 1 3

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