unit I.ppt HRM Introduction- Introduction, Nature, scope, objectives, importance and functions of HRM, Human resource as an asset in organization

Unit 1: Human Resource
Management Concepts

Introduction, Nature, scope, objectives,
importance and functions of HRM, Human
resource as an asset in organization,
Difference between Personnel Management
and Human Resource
Management, Roles and Qualities of HR
Manager, Concept of Strategic HRM
Content

“EMPLOYEES ARE THE MOST
IMPORTANT ASSET OF THE
ORGANIZATION”
• The process of planning, organizing,
directing (motivating), and controlling the
procurement, development, compensation,
integration, maintenance, and separation
of organizational human resources to the
end that organizational, individual, and
societal needs are satisfied.

According to American Management
Association:
Human Resource Management is that field of management
which has to do with planning, organizing and controlling
various operative functions of procuring, developing,
maintaining and utilizing a work force in order that
(a) the objectives for which the company is established are
attained as efficiently and economically as possible;
(b) the objectives of all levels of personnel are served to the
highest degree; and
(c) the objectives of the community are duly considered and
served.”

Human Resource Management includes all
activities used to attract & retain employees
and to ensure they perform at a high level in
meeting organizational goals.
These activities are made up of
1. Recruitment & selection.
2. Training and development.
3. Performance appraisal and feedback.
4. Pay and benefits.
5. Labor relations.

Nature of HRM
1. HRM is based on certain principles and policies which helps the organization to
achieve its objectives.
2. HRM is a pervasive function – It suggest that HRM is not associated to a single
department, instead it is a broader function and is spread throughout the organisation,
which manages all type of employees/people from lower level to top level departments of
the organisation.
3. HRM is people oriented – The main core or concern for HRM is the People or human
resource. Human resource management works with and for people. It acts as a bridge
which brings people and organisation together to achieve individual and organizational
goals.
4. HRM is continuous activity – As HRM needs to continuously train, develop, or replace
to meet the growing level of competition and changes in the market. Hence, it is a
continuous activity.
5. The HRM is a part of management function. Issues like hiring, training, development,
compensation; motivation, communication, and administration etc of employees are taken
care by Human resource management.
6. The main aim of HRM is optimum utilization of employees.

unit I.ppt HRM Introduction- Introduction, Nature, scope, objectives, importance and functions of HRM, Human resource as an asset in organization

• Managerial Process: Human resource
management is a vital part of management
that includes planning, organizing, staffing,
directing, and controlling human resources
to achieve organizational success. It is a
managerial process that effectively utilizes
human resources to attain organizational
goals and objectives.

• Both Art and Science : Human resource
management is a mixture of both art and
science. It is an art as it deals with qualitative
attributes like creativity, knowledge, skills,
and talent of the personnel. In simple words,
HRM is the art of getting things done by
others effectively. HRM is a science as it
requires different scientific techniques for
activities like recruitment, selection, training,
and appraisal of employees.

• Pervasive Force: Human resource management, being an inherent
part of an organisation, is pervasive in nature. It means that HRM is
present in different functional areas of management, like finance,
marketing, and production, in all commercial and non-commercial
enterprises. Everyone in the organisation, from the top to the lowest
level, must perform HRM functions regularly.
• Improve Employee Relations: In order to build a rewarding employee
experience, you need to understand what matters most to your people.”
– Julie Bevacqua.
Human resource management is concerned with building healthy
relationships between employees at various organizational levels.
Every individual has different needs, goals, and expectations. HRM
deals with these individual factors and motivates employees to reach
their maximum potential. Moreover, it creates an organizational culture
that fosters learning and growth.

• People-Centred: The nature of human resource
management is people-centred and relevant in all types of
organizations. It is concerned with every employee from the
top to the bottom level. HRM value people both as individuals
and as a group. Furthermore, it encourages people to develop
their full potential and fulfill individual and organizational
goals.
• Development-Oriented: The development of the workforce in
an organisation is crucial to the nature of human resource
management. HR managers use various tools to help
employees understand their strengths and unleash their
potential. Regular training programs can benefit employees by
improving their skills. Also, monetary and non-monetary
reinforcement can help people stay motivated to perform
better.

• Action Oriented: While human resource management does
follow the rules and policies, its main focus is on action and
results rather than rules. A human resource manager
stresses the importance of providing effective solutions for
employee problems, tensions, or controversies.
• Forward-Looking: Sustaining in the competitive business
environment requires organisations to plan long-term
strategies. HRM is a future-oriented approach that evaluates
the human resource requirements and ensures the
availability of required personnel in the right place at the
right time. With the forward-looking nature of human
resource management, managers prepare employees by
motivation, training, and development to face current and
future challenges in the changing business environment.

• Continuous Process: Human resource management is not
a ‘one-time’ function. Rather, it is a never-ending process
that must be performed continuously to achieve
organizational objectives effectively. It involves a series of
tasks, beginning with identifying the human resource
requirement and continuing with recruitment, training,
performance evaluation, and appraisal.
• Basis of Other Functional Areas : HRM is the basis of all
other functional areas of management, such as finance,
production, and marketing. The effectiveness of each of
these departments depends on the effectiveness of their
human resource management.

• Interdisciplinary Function: Human resource
management is multidisciplinary in nature. HR
managers utilize knowledge and inputs from
various disciplines to manage the workforce
effectively. The five major disciplines in HRM
include management, communication,
psychology, sociology, and economics. In order
to effectively manage human resources, one
must understand the contribution of all these
disciplines to HRM.

Scope of HRM
• The Personnel Aspect: Ensuring the individual
growth of each employee is in the nature of human
resource management, which can indirectly affect
the organization's overall growth. This aspect is
concerned with activities like assessing human
resource requirements, recruitment, selection,
placement, promotion, training and development,
transfer, incentives, remuneration, productivity, lay-
off, retrenchment, etc.

• The Employee Welfare Aspect: The
objective is to ensure proper working
conditions and amenities like canteens,
creches, lunch rooms, restrooms, housing,
transport, recreation facilities, etc., at the
workplace. HRM is responsible for
eliminating workplace hazards and
providing employees with job safety,
education, health and medical services,
and more.

• The Industrial Relation Aspect: The
objective is to maintain peace and
harmony in the organisation. How? By
interacting with the labour union,
addressing their grievances, and settling
disputes! The aspect covers union-
management relations, consultation,
bargaining, grievance action, and dispute
settlement.

• Organizational Objectives: In an organisation,
HRM’s objective is to maintain a competent
workforce. How? By planning, recruiting, selecting,
training, and developing the human resources for
the organization's growth, expansion, and survival.
Another critical organizational objective of HRM
includes facilitating other departments and helping
them function smoothly. The action-oriented nature
of human resource management assists an
organisation in achieving its goals. As an HR
manager, you should ensure the effective utilization
of human resources to help the organisation reach
its goals.

• Functional Objectives: Human resource management is
responsible for coordination within and among different
functional departments of the organisation. It organizes and
allocates the resources to achieve business objectives
effectively.
The objective of HRM is to provide every functional department
with employees who possess the required set of skills and
knowledge. To fulfill this very nature of human resource
management, HR managers must ensure the timely
completion of functions by the workforce. Moreover, it is
important to continuously provide employees with
opportunities and direct them toward the organization's
goals.

• Societal Objectives: HRM is responsible for ensuring
compliance with society’s legal and ethical standards at
every level of the organisation. The activities of HRM should
be socially responsible and fulfill society’s needs, demands,
and challenges. Therefore, HR managers must ensure that
the available resources are used for society’s benefit.
• To achieve this objective, HR managers develop programs
that meet employees’ psychological, social, ethical, and
economic needs. Some examples of these programs
include equal opportunities, compensation and benefits,
and community relations. By fulfilling the societal objectives
of employees, HRM aims to motivate and retain productive
employees.

• Personal Objectives: Employees’ long-term
association and commitment with an organisation
depend on their ability to achieve personal goals.
Therefore, HRM stresses the importance of fulfilling
employees’ personal objectives and increasing their
contribution to the organisation.
To prevent employee performance deterioration, HR
managers must help the workforce create a work-
life balance. They should also be provided with
adequate training and feedback on their
performance. Why? Because it helps employees
identify weak areas and rectify them.

• Foster a Better Work Culture: Improving
employee relations is an inherent nature of human
resource management. One of the most important
aspects of employee relations is their work
environment. Effective HRM requires developing
strategies that promote a better work culture. Some
examples of fostering a work culture include
developing and maintaining healthy relations
between team members, empowering the
employees, and adopting quick on boarding
processes.

• Adopt Tools for Team Integration: Effective team
coordination is one of the major objectives of
human resource management. Higher productivity
is the result of proper connections between
employees in the organisation.
• How to achieve that, you ask? By ensuring easy
communication between individuals and groups at
various enterprise levels! Therefore, HR managers
search for tools or portals that improve data
availability and make integration smooth and
easier.

• Increase Employee Engagement: While every
department in the company can and should
implement employee engagement programs, HRM
is vital to successful employee engagement
measures. HR managers organize events,
activities, and celebrations within the organisation
that not only helps in team development and
employee engagement but also foster employee
confidence. Moreover, boosting employee
engagement can help HR managers impact
employee retention, well-being, and productivity.

• Define an Organizational Structure: Though
important, hiring the right person for the right
task is only a small part of the process. Once the
employee is hired, the HR department needs to
define an organizational structure to nurture
employee skills. The organizational structure
required for a manufacturing firm varies
significantly from a hospital or an academic
institution. HRM is responsible for recognizing
the structures and practices that would work in
that specific work environment.

Functions of HRM
• 1. Hiring and Recruitment: One of the major roles of an HR
manager in an organization is to recruit new talent in the
organization. HR managers can recruit the talent using
various job boards, job agencies and physical ad copies. At
the end of hiring the candidate HR manager is responsible to
design the compensation structure of the employee.
• 2. Planning and scheduling: Another major role of HR in an
organization is to plan and schedule various events in the
organization. The events may include major meetings,
celebrations, major events and employee recognition. An HR
is responsible to notify all the employees about major events.

3. On boarding and training: On boarding plays an important role in
the life of new employees. An HR manager ensures the smooth on
boarding of new employees so that they can get familiar with the
organization’s culture. Training is important for employees to
understand the policies and procedures of new organizations.
Effective on boarding and training help new employees to get familiar
with the organization’s culture at a good pace which ensures
productivity.
4. Documentation of rules and policies: The HR manager is
responsible to design organizational policies and rules with the help
of management. They may also update traditional policies with time
in order to ensure transparency and comply with latest policies.
• For example- An HR manager may be responsible for policies such
as gratuity policy, posh policy, code of conduct policy etc.

5. Performance management of employees: Performance
Management allows organizations to design out promotion and
demotion of employees and design out their payout structure
according to their performance. An HR manager is responsible
for designing rewards and recognition for their employees. This
can happen monthly, quarterly or annually.
6. Resolution of conflict: It is necessary to resolve disputes and
disagreements between employees as soon as possible to
prevent clashes. An HR manager is responsible to resolve
disputes and reach out to management if required. An HR
manager must ensure they make unbiased decisions in case of
disputes.

7. Ensuring health and study: HR managers ensure the
health and safety of employees in the organization. They
make necessary arrangements to ensure the safety of
employees. To ensure the health of employees an Hr
manager may provide appropriate insurance plans, gym
memberships, and organize time-to-time competitions.
8. Positive reinforcement: An HR manager must ensure a
positive culture in the workplace by working directly with the
employees and their reporting managers. To do this HR
managers can use employee of the month, rising stars,
gem of the month etc. They can reward them with gift
cards, meal coupons or any other benefit.

9. Recording as well as Reporting: HR managers record and report
the performance of every department, performance metrics for
employees, risk and analysis of accidents. Recording and
reporting is a major function performed by employees by
documenting meetings. Tracking performance through
performance metrics is necessary to ensure and develop goals for
their improvement.
10. Managing compensation and benefits: HR managers are
responsible for designing the compensation of employees.
Adequate compensation helps organizations in employee retention
and brings more value to the organizations. Compensation is the
sum total of salary and other additional benefits provided to
employees like dearness allowance, conveyance allowance, travel
allowance etc. HR managers have to design a pay structure that
attracts top talents of the organization.

Human Resource as an Asset
in an Organization

Great Vision Without Great
People Is Irrelevant.
• Many great leaders, have always reiterated that our human
resources in any organisation are our largest assets.
Richard Branson advocates for shaping employees to their
best version as the people you employ are a product of you.
He further adds: “If you take care of your employees they
take care of your business”. In many industries we suddenly,
see the inability to retain staff especially in the health sector.
In this sector we require highly skilled labour and it’s
imperative once we have invested time and money on these
individuals we actually should be retaining them.

• It is quite obvious that not every employee is cut
from the same cloth, or has the same motivation to
remain in a job. Staff turnover can have serious
financial implications for an organisation, such as
the loss of clients, low morale, the added costs of
the recruiting process and then training new
employees. It is not only the cost incurred by a
company that emphasizes the need for retaining
employees but also the prevention of these
talented, skilled employees from being head-hunted

[1]. Implementing an effective retention
strategy can significantly reduce the high
costs of increased turnover, prevent the
loss of company knowledge, protect the
intellectual property of the organisation,
diminish the interruption of customer
service and maintain the good will of the
company, which in turn will regain the
efficiency and effectiveness of the services

[2].While a wide range of retention strategies
have been introduced in various settings
to reduce unnecessary staff turnover and
increase their length of stay, only a few of
these have been rigorously evaluated.
Little evidence demonstrating the
effectiveness of any specific strategy is
currently available

• [3]. Traditional retention strategies are no longer
effective for retaining professionals, people have
access to more information due to the 4th
industrial revolution. They able to learn more and
most are looking for value in an organisation. This
chapter focuses on retention strategies such as
career anchors, job characteristics, job
satisfaction, organizational commitment and
intention to quit. Once employers can understand
what retains employees, they are able to
implement these strategies to ensure human
resources are regarded as an asset.

What Is Personnel Management?
• Personnel management is hiring and developing employees’ skills,
experience and commitment to make their contribution more
valuable to the organisation. It includes activities such as job design,
performance appraisal, training, etc.
• It is important to note that personnel management is a relatively old
concept that predates the human resources management (HRM)
approach. In personnel management, employees are seen as a
resource that can be used to achieve organisational goals. It is in
contrast to HRM, which views employees as individuals with their
own needs and aspirations.

functions involved in personnel
management:
• Workforce Planning: This involves forecasting future
staffing needs and determining the best way to meet
those needs. It looks after both the quantitative and
qualitative aspects of workforce planning.
• Recruitment and Selection: Finding and hiring the best
candidates for vacant positions to come under
recruitment and selection. The selection process
includes screening applications, conducting interviews,
and administering tests.

• Performance Management: It involves setting goals and
objectives for employees, assessing their performance,
providing feedback, and taking corrective action when
necessary.
• Training and Development: It is all about providing
employees with the skills and knowledge they need to do
their jobs effectively. It includes both formal and informal
training methods. Employees learn about the organization's
culture, values, and goals during training and development.
• Employee Relations: This involves maintaining good
relationships between employees and management via
dealing with issues such as conflict resolution, grievance
procedures, and disciplinary action.

Basis for Comparison Personnel Management Human Resource Management
Meaning
The aspect of management that is
concerned with the work force and their
relationship with the entity is known as
Personnel Management.
The branch of management that focuses on
the most effective use of the manpower of
an entity, to achieve the organizational
goals is known as Human Resource
Management.
Approach Traditional Modern
Treatment of manpower Machines or Tools Asset
Type of function Routine function Strategic function
Basis of Pay Job Evaluation Performance Evaluation
Management Role Transactional Transformational
Communication Indirect Direct
Labor Management Collective Bargaining Contracts Individual Contracts
Initiatives Piecemeal Integrated
Management Actions Procedure Business needs
Decision Making Slow Fast
Job Design Division of Labor Groups/Teams
Focus
Primarily on mundane activities like
employee hiring, remunerating, training,
and harmony.
Treat manpower of the organization as
valued assets, to be valued, used and
preserved.

The Vital Qualities of an HR
Manager
• Leadership Skills - An HR Manager is the bridge
between the employee and the organization. Hence his
leadership skills such as the ability to understand
employees and their needs, delegate tasks, visualize the
bigger picture and remain aligned to the vision of the
organization are crucial. It is also important that they
possess sound knowledge of the functioning of every
department of the organization, such as marketing,
finance, sales and so on.

• Communication Skills - Communication
should be the middle name of an HR
Manager. He is responsible for much of the
interpersonal communication with the
employees and top bosses of the
organization. Hence he must be both a
people’s person and remain aligned with the
organization.

• Self-Discipline - Because the HR manager
deals with real people, challenges can crop
up at any hour. He is also engaged in
delivering multiple tasks throughout the day.
Hence he should be adept at prioritizing his
tasks and managing any issues that could
come up. This requires great mental and
intellectual discipline.

• Ethics and Integrity - The HR is aware of
confidential company policies pertaining to
salary packages, placement criteria,
selection processes, etc. He is also the
one who receives the smallest to the
biggest complaints such as money
laundering and sexual misconduct. Hence
his sense of fairness and integrity must be
in the right place. He must be true to his
conscience at all times.

• Empathetic Attitude - The HR should essentially
be a people’s person. This is a soft skill that can be
built with time but it is at the center of the role. He
should be able to work towards the satisfaction of
all employees while retaining the essence of the
organization at the same time. He should take care
to not involve himself in personal issues of the
employees and restrict himself to professional
complaints unless absolutely necessary.

• Legally Sound - The HR makes key
decisions pertaining to policy frameworks
for the organization. He should ensure he
consults the legal team regarding the
implications of the same. This will enable
him to tackle any loopholes or issues that
might crop up.

• Empathetic Attitude - The HR should
essentially be a people’s person. This is a
soft skill that can be built with time but it is at
the center of the role. He should be able to
work towards the satisfaction of all
employees while retaining the essence of the
organization at the same time. He should
take care to not involve himself in personal
issues of the employees and restrict himself
to professional complaints unless absolutely
necessary.

The Roles of the HR Manager
1. Conducting interviews and selecting the appropriate candidates
2. Manage the entire recruitment and placement processes effectively
3. Assigning job roles and designations as per the abilities of the
candidate
4. Ensuring training and induction processes are in place to welcome
candidates
5. Work consistently with the founding team on enhancing organizational
climate
6. Organize programs as and when need to boost employees’ mental
health

Strategic human resource
management (SHRM)
• Strategic human resource management (SHRM) can be
defined as the process of managing people in a way that
optimizes the business's goals and objectives.
• Basically, strategic HRM is a process that helps
companies align their HR activities with the broader
business strategy and objectives.
• It involves identifying and prioritizing the skills,
competencies, and experiences needed for success in
your organization. After that, it develops a plan on how to
use those skills to push the company’s goals.

• Resource-based Strategy: Focuses on enhancing the
strategic capabilities of the company
• High Commitment Management: Establishing better
commitment between managers and their employees.
• Achieving Strategic Fit: Integration of workforce and
material resources through a streamlined and high ROI
oriented operational model
• High Involvement Management: Empowering and treating
employees as stakeholders.
• High-Performance Management: Enhancing company
performance through superior productivity, growth, and
profitability rate of the workforce.

Scope of Strategic Human
Resource Management
1. HRM in Manpower Planning: This is usually direct personnel
management, which includes planning for the use of labor,
recruiting, learning and advancement initiation and alignment,
relocation, elevation, remuneration, layoffs and reductions,
and job performance. The main goal in this situation would be
to evaluate self-improvement, progress, and efficacy as they
implicitly influence the innovation process.
• Additionally, it covers the performance assessment, the
formation of skills, the payment of salary, bonuses, and
accommodations, as well as transportation procedures and
guidelines.

2. Workforce Welfare and HRM: This specific place of
HRM focuses on worksite facilities and business
conditions. It encompasses various duties and offerings,
including insurance, healthcare, economy, welfare
benefits, and hospital assistance.
• Additionally covered are just the hiring of safety
inspectors, improving the job atmosphere, removing
potential dangers at the job, support from top-level
management job protection, protecting industrial
equipment, neatness, appropriate heating and air,
hygiene, healthcare, sick pay, worker's compensation
advantages, parental leave, disability benefits, and social
security payments.

3. Work Relations and HRM: It requires proper contact with labor or
staff associations, resolving their complaints, including efficiently
resolving conflicts to keep unity and tranquility in the company
because it is a very touchy matter.
• Mastering labor relations, collective agreements, dispute resolution
procedures, problem-solving via joint work, people's behavior and
preserving professional relationships, union representation, and
conflict resolution are all covered.
• The primary target is to defend employee interests by achieving the
maximum degree of knowledge while minimizing any adverse
consequences for the business. Economic sovereignty must be
established, expanded, and promoted to serve the engrossment of
both workers and management.
• Since HRM has such a broad focus, it is impossible to write about it
briefly. Nonetheless, we categorize the topic into the 3 phases listed
above for simplicity and to help others better comprehend it.

Importance of SHRM
1. Connecting employees with
organizational goals – The Strategic
Human Resource Management process
ensures that HR practices, policies, and
strategies link employees with the
company’s path to accomplishing its
broader organizational objectives.

2. Gaining a competitive advantage –
Knowing exactly where leadership wants
to take the organization allows the HR
department to focus on the skills and
abilities people need to do the work it
takes to get there. Through effective
talent management, training, and
development, SHRM can lead to a more
competent and skilled workforce that
yields a competitive edge over rivals.

3. Adapting to change – A strategic
approach to HRM means continually looking
ahead, allowing organizations to anticipate
and quickly adapt to changes in the
business environment. Plans can adjust to
accommodate technological advancements,
market shifts, or evolving workforce
demographics. Meanwhile, HR supports,
motivates, and communicates with
employees throughout the adjustments.

4. Enhancing employee performance – Strategic
HRM determines how employees add value and
facilitates performance management systems
that ensure they are motivated, well-trained, and
properly evaluated. HR can implement methods
for addressing employee weaknesses and
reinforcing their strengths, leading to optimal job
performance and productivity. What’s more, it
can strive to improve performance through
improved employee wellbeing.

• Driving business growth – With its
emphasis on proactive planning, SHRM
identifies gaps in current resources and
forecasts future workforce needs. As a
result, the organization is equipped with
the necessary human capital to launch
initiatives, enter new markets, and drive
growth.

• Improving operational efficiency – A
strategic approach to HR is about
meticulously designing roles,
responsibilities, and workflows to
specifically suit the company’s human
capital needs. This clarity streamlines
operations to reduce redundancies and
boost overall efficiency, directly
contributing to better business
performance.

1. Employee Engagement
• Effective communication is among the most
significant markers of quality of work life. The idea of
employee engagement in human resources (HR)
refers to how enthusiastic and committed an
individual is to his profession.
• Committed workers are concerned about their job
and the organization's success and believe their
contributions matter. Employee engagement
promotes long-term engagement, increased
productivity, higher-caliber output, and
organizational success.

2. Introduce Best Practices
• Maintaining openness and being candid
with employees regarding the company's
successes and shortcomings is an
essential HR strategy.
• Workers feel recognized, appreciated, and
cherished in organizations that encourage
public condemnation and conversation.

3. Teach Tools and Techniques
• A collection of software programs called
an HRMS, or strategic human resource
management system, is used to interact
with employees and associated processes
across the hiring process.
• Some of the tools in hrm are- training,
workshops, mentoring, simulations, on-
the-job training, etc.

4. Improve HR Effectiveness
• Worker satisfaction and motivation to participate in an
organization's growth are fostered by effective HR
procedures.
• Learning, expertise, and capabilities may boost a
company's market edge. Efficacious organizations are
focusing on this beneficial impact of HR by ensuring
that workers train, gain knowledge, and achieve better.
• Human resource management is critical in ensuring
worker opportunities and increasing company
efficiency and quality.

5. Publish Research
• Human resource management research
assesses HR practices and effectiveness.
Mass surveillance, analysis, and
conclusion-making are all steps in the
structured, scholarly research process.

unit I.ppt HRM Introduction- Introduction, Nature, scope, objectives, importance and functions of HRM, Human resource as an asset in organization

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