Human Resource Management

4. Human Resource Management

Human Resource Management is a management function concerned with hiring, motivating, and
maintaining workforce in an organization. It is involved with the human relation of an
organisation issues related to employees such as hiring, training, development, compensation,
motivation, communication, and administration.

4.1.1. Personnel Management

4.1.2. Definition:
Personnel management can be defined as obtaining, using and maintaining a satisfied workforce.
It is a significant part of management concerned with employees at work and with their
relationship within the organization.
Or,
Personnel management can be defined as the Planning, Organizing, Directing and Controlling of
the Procurement, Development, Compensation, Integration and maintenance of people (i.e.
employee) for the purpose of contributing to the organizational goal.

4.1.3. Objectives of personnel management/ HRM:

1) Procurement and maintenance of adequate workforce (employee) as regards to both- number
and quality of personnel.
2) Education and training of present employees.
3) Maintaining satisfactory personnel contacts and employee relationships.
4) Maintaining satisfactory group relationship.
5) Maintaining employee’s health.
6) Maintaining employee’s safety.
7) Maintaining employee’s service activity (employee welfare).

4.1.4. Functions of personnel management/ HRM:

1) Planning manpower recruitment
a) Forecasting vacancies
b) Recruitment
c) Planning
2) Organizing the manpower
a) Organizing
b) Selection
3) Staffing
a) Induction
b) Transfer/ Promotion
c) Manpower development
d) Training
4. Motivating
a) Payments
b) Recreation
c) Communication
d) Health and safety
e) Collective bargaining
f) Employees discipline
5. Controlling
a) Performance appraisal
b) Security
c) Employees attitude and co-ordination

4.2. Staffing
Staffing can be defined as one of the most important functions of Human Resource Management
(HRM). It involves the process of filling the vacant position of the right personnel at the right
job, at right time. Hence, everything will occur in the right manner. The objective of staffing is
to obtain, develop, maintain and motivate people to contribute to achieve organizational goal.
4.2.1. Human Resources Planning

This is the first step in the process of staffing. It is concerned with determining the number and
types of staff required for the organisation. HRP is the process by which an organisation ensures
that it has right number of people and right kind of people at right place and right time.
The major functions of HRP are:
1. Effective utilization
2. Forecasting the needs
3. Developing proper policies and programmes to meet the needs
4. Reviewing and controlling the total process.
The factors affecting the HRP are:
1. Type and strategy of organization.
2. Organizational growth cycles and planning.
3. Emergence of new technologies.
4. Uncertainties in the environment.
5. Time horizons.
6. Type and quality of forecasting information.
7. Labour market.

4.2.2. Recruitment Procedure

• Recruitment is the activity of developing a list of eligible applicants for positions within
the organisation. The objective of recruitment is the placement of right man at the right
time in the right place on the right job.
• Recruitment may be (a) internal (e.g. promotion, transfer) or (b) external sources (fresh
trainee candidate, experienced employee from other organization and retired staffs re-
employment).

(a) Method of recruitment (Internal sources):

All or some posts are filled up from existing eligible employee by transfer, promotion, or
by re-employment of retired staff. Here, Transfer or promotion means employee are
transferred/ promoted from other unit of same location or from other location of same
company. Re-employment means retired employees of the company are re-employed.

(b) Method of recruitment (External sources):

• Advertisement for different position of an organization is given in TV, Newspaper, and

website.
 • Asking name from Employment exchange, Employment bank, Technical colleges and
universities.
• Recruitment through different recruitment agencies or consultancy firms.
• By Campus interview – Big companies visit renowned university, Institution for
selection of Engineer, Management Graduate and skilled technician.
• Forced application & Bio-Data already submitted by different candidates in different
time.

Selection :

Selection is the process of selecting the person most suited for the job and also weeding out the
unsuitable candidates.

Steps of scientific selection process:

1. Determine the nature of job to be filled.

2. Determine the nature of personnel required.
3. Determine the source of recruitment.
The following are the processes in selection.
a) Scrutiny of application forms: Scrutinizing the application form in respect of age,
qualification, experience required for applicant.
b) Verification of reference letters where it is applicable.
c) Preparation of list of eligible applicants who will be called for subsequent test.
d) Tests: Calling for different test such as written test, aptitude test, psychological test, skill
test or practical test (for technicians), Group discussion. There may be short listing of
candidates after each test. Written test on subject , practical test on candidates theoretical
& practical knowledge, aptitude test is the test of candidates aptitude, group discussion is
a test of candidates ability to work in a group, ability to convince other, ability to listen
others opinion and finally the quality of leadership. Psychological tests are to judge the
state of mind.
e) Interviews: Short listed candidates are called for Interview. Interviews are generally
divided in two parts technical interview and personal interview. In technical interview
apart from the knowledge of subject and experience related questions were also asked.
Personal interview includes physical appearance, body gesture, posture, mode of delivery
of talk; endurance, morality, integrity, imagination, hobby, aims and ambition are tested.
Some people explains the word INTERVIEW ( I- insight- into personality , N- Nature
and need, T – tenacity, E- Evaluation, R- reaction to pressure , V- vision and
visualization , I – interest & Imagination, E- Enthusiasm, Endurance and empathy ,
W- willingness to undertake responsibility for achieving results).
 f) Medical Examination: After being shortlisted in interview the candidates are called for
medical test.
g) Placement: Finally call letters are issued to medically fit candidates mentioning the post,
the place of posting, date of joining, duration of training period, remuneration during and
after training, other condition like bonds, leave, medical facility etc.

Personnel selection involves placing the candidate in a job suited to his activities, aptitudes,
personality traits and other characteristics, keeping in mind the availability of the requisite job in
the organisation. In selection process the most important ingredients are job description and job
specifications.

Difference between recruitment and selection

Sl. Recruitment Selection

No.
1. Recruitment is the process of Selection is the process of finding out right or
searching qualified and competent best possible candidates among the applicant
persons for different position of the or job seeker for the post.
organization. So, the term recruitment
may be referred to as activity which
brings job & jobseeker together.

2.
Recruitment is the filling up vacancies It consists of scrutiny of application (age,
or requirement. It consists of qualification & experience ), written test for
advertisement of requirement and Aptitude & Subject , psychological test ,skill
collection of application. test or practical test (for technicians), Group
discussion, Personal Interview & finally
medical test

4.3. Personnel- Training & Development

Training is a planned process to modify attitude, knowledge or skill, behavior etc through
learning to achieve effective performance in an activity or range of activities. Its purpose in the
work situation is to develop the abilities of the individual and to satisfy the current and future
man power.

Why training and development is required?

Training and development is a continuous programme for different categories of post of existing
and newly recruited employee of the organization to enhance technical knowledge, to improve
managerial & conceptual skill. Time to time training of an employee is required to improve and
update their skill because-
a) The rapid changes of technology
b) Growth of organization
c) Changing the objective and target or goal of the organization
d) Changing duties and responsibilities

• Technical skill is required for any new employee or for all employees when a new
technology is introduced.
• Conceptual skill development is also necessary time to time to understand & integrate the
organizational interest, goal and target.
• Managerial skill development programme on leadership, perception, morality, integrity
should take place regularly to motivate all employees to achieve organizational goal.

Circumstances when training and development is required

1. Training of newly appointed employee.

2. Training of newly promoted /transferred employee.
3. Development of existing employee.
4. Change in technology, method, process and machines.
5. Expansion or growth of company in new field.

Types of training

1. Induction training:
Induction training is also known as orientation training given for the new employee. It is a
process of familiarization of new company, vision and mission of the business and organization,
places of business, organizational structure, duties and responsibilities, facilities, financial
condition of company (e.g. profit, turn over, share value), future expansion, visits to different site
and places of business.

2. On Job training:
On job training is intended to introduce the new employee about the job and is designed to train
the employee in a greater depth for a job. This is learning while earning.

3. Apprenticeship training:
Apprenticeship training is either under the law of the land like Apprentice Act or as apprentices
for future needs of the organization.

4. Supervisory training :
It is to train a person for potential supervisory posts like, foreman etc.

5. Management training:
It is for managers and executives to enhance and upgrade their managerial and technical skill
time to time to achieve the goal of company.

Methods of training:

1. Training through lecture, talk, discussion.

2. Training using power point presentation
3. Training through role play in their job for dealing with face to face situation.
4. Training through Case study
5. Training through exercise in groups.

Performance appraisal:

Performance appraisal is a systematic method of judging the employee and also analyzing their
ability to perform a given task. To appraise means to ‘differentiate between individuals’.
Performance appraisal is a managerial tool to find effectiveness in hiring people. It evaluates the
performance of a job and its requirements. It is a systematic assessment of an employee in terms
of performance, aptitude and the other qualities like leadership, personality, attitude, potential
and ability to motivate others.

Merit Rating

Merit Rating is the process of evaluating the performance of an employee and comparing it with
that other, i.e. employee’s internal merits like, body, nature, strength, mental capabilities etc.
This is only a part of performance appraisal process. Each parameter of Performance of
employee is measured in quantitative terms. It is measured for every employee of same category
and compared to make gradation for the purpose of any form of reward like, promotion, increase
in pay etc.

Comparison between Merit rating and performance appraisal:

1. Merit rating technique applied for evaluating performance of worker and clerical staff while
performance appraisal is the technique for evaluating performance of managerial staff.
2. Merit rating is generally once in a year while performance appraisal is conducted more
frequently.
3. Merit rating, the performance of individual employee’s assessment by his immediate superior
and superior does not discuss the matter with the person whose performance is rated but in
performance appraisal a two way communication between appraisers and evaluator.

Purpose of performance appraisal:

1) Identifying the potential in employees for salary increase, promotion, transfer, lay off and
termination.
2) Determining the needs of training for further improvement in performance.
3) Motivating employees by letting them know their strength and weakness.
4) Establishing a basis for research and also a base for personnel decision like increasing job
satisfaction, work culture, motivation.
5) It also gives a clear indication of effectiveness of recruitment, training & development
programme.

Methods of performance appraisal:

Traditional methods:
1. Straight Ranking
2. Man to man comparison
3. Grading
4. Graphic rating scales
5. Forced choice technique
6. Forced distribution
7. Check lists
8. Free essay method
9. Critical incidents method
10. Group Appraisal

Modern Methods:
1. Assessment centre
2. Appraisal by results- Management by objective (MBO)
3. Cost accounting method

Traditional Methods:
 1. Straight Ranking
This is traditional approach. The assumption is that supervisors know better about the
performance of the workers.

2. Graphic rating scale

This method assesses the degree of registered traits, industry, reliability, sincerity, dependability
etc for performing the job. The degree is measured in point scale which can be either very good,
good, above average, average and below average or in numerical standard from 5 to 1.

3. Ranking Method
Here the rater simply rates the employee in order of merit. It is very simple but very lengthy.

Modern Methods:

1. Assessment Centre:
It is a multiple assessment of several individuals performed by a group of trained evaluators
using variety of individuals and group exercises.

2. Cost accounting method:

This is based on the monetary yields- contribution of the employee to the organization. The cost
incurred on the employees and the benefit of the organisation drives from it, is rated.

3. Management by objective (MBO)

Objectives are the goals, aim or purposes that organisations wish to achieve over varying periods
of time.
According to Koontz, O’Donald and Weihrich, “Management by Objective is a comprehensive
managerial system that integrates many key managerial activities in a systematic manner,
consciously directed towards the effective and efficient achievement of organisational
objective”.

Advantages

1) Helps in increasing employee’s motivation.

2) Competition among managers.
3) Identifies problem.
4) Identifies performance deficiency.
5) Helps manager in leadership.

Disadvantages
1) Problems in objective setting.
2) Failure to teach MBO philosophy.
3) Inflexibility.
4) Failure to give guidelines by objective setters.