Professor. Meenal Gupta, ATSS CBSCA, Chinchwad.

Unit- 1 Introduction to HRM

A.T.S.S.’s
College of Business Studies and Computer Applications
Chinchwad, Pune 19
[Affiliated to Savitribai Phule Pune University, UGC Recognized under
2(F)&12(B), Recognized by Govt of Maharashtra, Accredited by NAAC]
AY 2021-22

Class-SY BBA SEM III

Subject: - PRINCIPLES OF HRM
Notes on

UNIT 1 INTRODUCTION TO HRM

• Meaning:
Human resource management is the strategic approach to the effective and efficient
management of people in a company or organization such that they help their business gain
a competitive advantage. It is designed to maximize employee performance in service of an
employer's strategic objectives.
Human: refers to the skilled workforce in an organization.
Resource: refers to limited availability or scarce.
Management: refers how to optimize and make best use of such limited or scarce resource so as
to meet the organization goals and objectives.
Therefore, human resource management is meant for proper utilisation of available skilled
workforce and also to make efficient use of existing human resource in the organisation.

• Definition:

• Edwin Flippo

• Human Resource Management as “planning, organizing, directing, controlling of

procurement, development, compensation, integration , maintenance and separation of
human resources to the end that individual, organizational and social objectives are
achieved.”

• The National Institute of Personal Management

• (NIPM) of India has defined human resources – personal management as “that part of
management which is concerned with people at work and with their relationship within
an enterprise. Its aim is to bring together and develop into an effective organization of the
men and women who make up enterprise and having regard for the well – being of the
Professor. Meenal Gupta, ATSS CBSCA, Chinchwad. Unit- 1 Introduction to HRM

individuals and of working groups, to enable them to make their best contribution to its
success”.

• According to Decenzo and Robbins, “Human Resource Management is concerned with the
people dimension” in management. Since every organization is made up of people,
acquiring their services, developing their skills, motivating them to higher levels of
performance and ensuring that they continue to maintain their commitment to the
organization is essential to achieve organsational objectives. This is true, regardless of the
type of organization – government, business, education, health or social action”.

• "You must treat your employees with respect and dignity because in the most automated
factory in the world, you need the power of human mind. That is what brings in innovation.
If you want high quality minds to work for you, then you must protect the respect and
dignity. " -Mr N.R. Narayana Murthy, Chairman Emeritus, Infosys Ltd.
• Features:
1. People Oriented:
Human resource management is concerned with employees both as individuals and as a group
in attaining goals. It is also concerned with behaviour, emotional and social aspects of
personnel. It is the process of bringing people and organisations together so that the goals of
each are met.

2. Comprehensive Function:
Human resource management covers all levels and categories of employees. It applies to
workers, supervisors, officers, managers and other types of personnel.

3. Individual Oriented:
Under human resource management, every employee is considered as an individual so as to
provide services and programmes to facilitate employee satisfaction and growth. In other
words, it is concerned with the development of human resources, i.e., knowledge, capability,
skill, potentialities and attaining and achieving employee goals.

4. Continuous Function:
Human resource management is a continuous and never ending process. According to George R
Terry, “it cannot be turned on and off like water from a faucet; it cannot be practiced only one
hour each day or one day each week.

5. A Staff Function:
Human resource management is a responsibility of all line managers and a function of staff
managers in an organisation. Human resource managers do not manufacture or sell goods but
they do contribute to the success and growth of an organisation by advising the operating
departments on personnel matters.

6. Pervasive Function:
Human resource management is the central sub-function of an organisation and it permeates all
types of functional management viz., production management, marketing management and
financial management.
Professor. Meenal Gupta, ATSS CBSCA, Chinchwad. Unit- 1 Introduction to HRM

7. Challenging Function:
Managing of human resources is a challenging job due to the dynamic nature of people. Human
resource management aims at securing unreserved co-operation from all employees in order to
attain pre-determined goals.

8. Development Oriented:
Individual employee-goals consist of job satisfaction, job-security, high salary, attractive fringe
benefits, challenging work, pride, status, recognition, opportunity for development etc. Human
resource management is concerned with developing the potential of employees, so that they
derive maximum satisfaction from their work and give their best efforts to the organisation.

• Scope:
• The scope of HRM is, indeed, very vast and wide. It includes all activities starting from
manpower planning till employee leaves the organisation. Accordingly, the scope of HRM
consists of acquisition, development, maintenance/retention, and control of human
resources in the organisation (see figure 1.1). The same forms the subject matter of
HRM. As the subsequent pages unfold, all these are discussed, in detail, in seriatim.

•
• The Labour or Personnel Aspect: This is concerned with manpower planning,
recruitment, selection, placement, transfer, promotion, training and development, lay-
off and retrenchment, remuneration, incentives, productivity, etc.
• 2. Welfare Aspect: It deals with working conditions, and amenities such as canteen,
creches, rest and lunch rooms, housing, transport, medical assistance, education, health
and safety, recreation facilities, etc.

• 3. Industrial Relations Aspects: This covers union-management relations, joint

consultation, collective bargaining, grievance and disciplinary actions, settlement of
disputes, etc.

• Objectives:
• To help the organisation to attain its goals effectively and efficiently by providing
competent and motivated employees.
Professor. Meenal Gupta, ATSS CBSCA, Chinchwad. Unit- 1 Introduction to HRM

2. To utilize the available human resources effectively.

3. To increase to the fullest the employee’s job satisfaction and self-actualisation.
4. To develop and maintain the quality of work life (QWL) which makes employment in the
organisation a desirable personal and social situation.
5. To help maintain ethical policies and behaviour inside and outside the organisation.
6. To establish and maintain cordial relations between employees and management.
7. To reconcile individual/group goals with organizational goals.
• Importance:
• HR Management helps the organization to achieve its strategic goals by attracting,
retaining and developing employees. The significance of this department is discussed as
follows:
• Utilization of human and non-human capital
• The human resource department makes the company realize the importance of the
human capital in respect to the company’s economy. Human capital is particularly
important for smaller firms as the employees, quite often, perform cross-functional duties.
• The HR department teaches the organization how to utilize this human capital as well as
the non-human one and so, the organizations, who aim to efficiently utilize their resources
and increase the profit invite the HR management people to formulate required objectives
and policies.
• Training and Development of Human Resources
• HR management conducts surveys and observes the employees to assess their needs to
determine the type of training and development needed for the current workforce of the
organization to enhance their caliber to work and achieve their respective objectives and
targets. Small scale companies or the companies in their starting phase can benefit
immensely by training their existing employees instead of recruiting additional work-force.
In-house practical training, executive education available in most of the business schools,
etc are important tools of training and development of employees.
• Employee satisfaction
• After gauging the individual needs and preferences of the employees, the specialists of HR
management provide them with a series of facilities and opportunities for their career
development leading to job satisfaction and commitment on their part. The HR people are
also in charge of measuring the amount of employee satisfaction and they also determine
the causes of employee dissatisfaction and address the issues to motivate them to
perform better.
• Performance appraisal
• Employees can end up doing jobs that aren’t suited to their skills and expertise without
proper planning on the part of the HR people who measure and evaluate their
performances. The staff of the company is communicated the necessary information
regarding their performances and also defining their roles in the company. Taken on a
regular basis, performance appraisals motivate the employees immensely.
• Resolution of conflicts
• Given the diversity of personalities, work styles, backgrounds and levels of experience,
there are several day-to-day issues on which disputes may arise in an organization either
among the employees or between employees and employer. In these inevitable disputes,
the HR managers act as both consultants and mediators. By hearing the grievances of both
Professor. Meenal Gupta, ATSS CBSCA, Chinchwad. Unit- 1 Introduction to HRM

the parties, they identify and resolve the conflicts and restore positive working
relationships.
• Maintaining goodwill
• Hr management has the responsibility of developing good public relations as well as
maintaining the goodwill of the company among other public sectors. The corporate
image of a business is built on the way they treat their employees because those are the
companies in which people trust and also for which they want to work. Sometimes the HR
department also plays an active role in preparing marketing plans of the company.

• Principles of HRM
The following can also be considered as the principles of Human Resource Management:

1. Principle of Individual Development – To offer an equal opportunity to every employee

so as to realize his/her potential and capability.
2. Principle of the Scientific Selection – To place the right individual in the right job.
3. Principle of the Free Flow of Communication- To open & encourage upward, downward,
formal, and informal communication.
4. Principle of the Participation – To associate with employees at each and every level of
decision making.
5. Principle of a Fair Remuneration- To pay fair and equitable wages & salaries to talented
employees.
6. Principle of an Incentive – To review the performances of the employees and to reward
them accordingly.
7. Principle of the Dignity of Labor – To treat each and every employee with respect and
dignity.
8. Principle of Labor-Management co-operation – To promote industrial relations and
labor laws.
9. Principle of Team Spirit – To ensure co-operation & teamwork amongst the employees.
10. Principle of Contribution to National Prosperity – To provide a higher work purpose to
all the employees and to contribute to the national prosperity and integrity.

• Evolution of HRM:
Industrial Revolution Era:
The systematic development of HRM started with industrial revolution that started during 1850s
in Western Europe and USA. The industrial revolution consisted, essentially, the development of
machinery, the use of mechanical energy in production processes, and consequently the
emergence of the concept of factory with large number of workforce working together.
The factory system replaced the old cottage system. Industrial revolution brought out a number
of changes like centralized work locations with large number of workers working together,
mechanized production process, migration of workers from their place of origin, and indirect
contact between factory owners and workers.
In order to manage people in the factory system of industrial revolution, three systems of HRM
were developed- recruitment of workers, training for workers, and control of workers. However,
the basic philosophy of managing workers revolved around master-servant relationship.
Professor. Meenal Gupta, ATSS CBSCA, Chinchwad. Unit- 1 Introduction to HRM

2. Trade Union Movement Era:

Shortly after the emergence of factory system, workers started to organize themselves based on
their common interests to form workers’ associations which were subsequently known as trade
unions. The basic objectives of these associations were to safeguard interest of their members
and to sort out their problems which arose primarily because of employment of child labour,
long hours of work, and poor working conditions.
Later, other aspects of work such as economic problems and wages, employee benefits and
services, etc. also became issues. These trade unions started such weapons as strikes,
slowdowns, walkouts, boycotts, etc., for the acceptance of their demands.
These activities of the trade unions forced owners and managers to adopt employee grievance
handling systems, arbitration as a means of resolving conflicts between owners/managers and
workers, disciplinary practice, expansion of employee benefit programmes, holiday and vacation
time, clear definition of job duties, job rights through seniority, and installation of rational and
defensible wage structures.
3. Social Responsibility Era:
In the first decade of 20th century, some factory owners started adopting a more humanistic
and paternalistic approach towards workers. Paternalistic approach to labour management is
based on the philosophy that labour is just like a child and owner is just like a father and the
owner should take care of his labour just like a father takes care of his children.
Those industrialists who adopted paternalistic approach offered a number of concessions and
facilities to labour force like reduced number of work hours, improved facilities at workplace,
model villages to workers, etc. All these practices led to the development of social welfare
aspect of labour management.
Many critics to paternalistic approach viewed that this approach was adopted to overcome the
problems posed by labour union movement as plenty of trade unions emerged which frequently
interrupted work performance. Employers observed that workers were going out of their
control and to overcome this problem, they implemented welfare scheme. Thus, this was a
compulsion rather than a philosophy.
4. Scientific Management Era:
Around the beginning of 20th century, Taylor started to find out ‘one best way of doing thing’
based on time and motion studies. On the basis of his experiments, he was able to increase
workers’ productivity considerably and wrote many papers based on these experiments and a
book on scientific management.
The main principles of scientific management are:
(i) Replacing rule of thumb with science, (ii) harmony, not conflict, (iii) cooperation, not
individualism, and (iv) development of each and every person. Scientific management
techniques relevant to management of workers are- functional foremanship, standardization
and simplification of work, and differential piece wage system.
5. Human Relations Era:
Around 1920s, management researchers gave a close look at the human factor at work and the
variables that affected people’s behaviour. Before that, Hugo Munsterberg wrote a book on
‘Psychology and Industrial Efficiency’ which suggested the use of psychology in the field of
personnel testing, interviewing, attitude measurement, learning, etc.
This brief period was termed as ‘Industrial Psychology Era’. In 1924, a group of professors from
Harvard Business School, USA, began an enquiry into the human aspects of work and working
conditions at Hawthorne plant of Western Electric Company, Chicago.
Professor. Meenal Gupta, ATSS CBSCA, Chinchwad. Unit- 1 Introduction to HRM

They conducted researches from 1924 to 1932 and arrived at the conclusions that productivity
of workers depended on- (i) social factors at the workplace, (ii) group formation and group
influence, (iii) nature of leadership and supervision, and (iv) communication.
They concluded that in order to have better productivity, management should take care of
human relations besides the physical conditions at the workplace. Consequently, the concepts
of social system, informal organization, group influence, and non-logical behaviour entered the
field of management of personnel.
6. Behavioural Science Era:
In contrast to human relations which assume that happy workers are productive workers, the
behavioural scientists have been goal and efficiency- oriented and consider understanding of
human behaviour to be the major means to that end. They have tried several sophisticated
research methods to understand the nature of work and the people in the work environment.
The contribution of behavioural scientists to management practices consists primarily of
producing new insights rather than new techniques. It has developed or expanded a useful way
of thinking about the role of the manager, the nature of organizations, and the behaviour of
individuals within organizations. As against human relations model, they have given the concept
of human resource model.
Major conclusions of the contributions made by behaviouralists are as follows:
i. People do not dislike work. If they have been helped to establish objectives, they will want to
achieve them. In fact, job itself is a source of motivation and satisfaction to employees.
ii. Most people can exercise a great deal of self-direction and self-control and generate more
creativity than required in their current job. Therefore, their untapped potential remains
unutilized.
iii. Managers’ basic job is to use untapped human potential in the organization.
iv. Manager should create a healthy environment wherein all persons can contribute to the best
of their capacity. The environment should provide a healthy, safe, comfortable, and convenient
place to work.
v. Managers should provide opportunity for self-direction by their subordinates and they must
be encouraged to participate fully in all important matters.
vi. Operating efficiency can be improved by expanding subordinate influence, self- direction, and
self-control.
vii. Work satisfaction may improve as a ‘by-product’ of subordinates making full use of their
potential.
Behavioural science era led to the development of two-way communication, participation of
employees in decision making, joint goal-setting, group dynamics, management development,
and management of change in the organization. These contributions of behavioural science era
are backbone of behavioural approach of human resource management even in the present
context.
7. Systems and Contingency Approach Era:
Systems and contingency approach has attracted maximum attention of thinkers in
management in the present era. It is an integrated approach which considers management of
human resources in its totality based on empirical data. The basic idea of this approach is that
analysis of any object must rely on a method of analysis involving simultaneous variations of
mutually-dependent variables. This happens when systems approach is applied in managing
human resources.
Professor. Meenal Gupta, ATSS CBSCA, Chinchwad. Unit- 1 Introduction to HRM

8. Human Resource Management Era:

When the factory system was applied in production, large number of workers started working
together. A need was felt that there should be someone who should take care of recruiting,
developing, and looking after welfare of these workers. For this purpose, industrial relations
department came into existence in most of the large organizations which was concerned mostly
with workers.
However, as the time passed and the complexity of managing human resources in large business
organizations increased, the scope of industrial relations department was extended to cover
supervisory staff and subsequently managerial personnel. Industrial relations department was
named as personnel department.
With the increasing competition for market share, competition for resources including human
talents, and increased knowledge in the field of managing human resources, people were not
treated merely as physiological beings but socio-psychological beings as a prime source of
organizational effectiveness and large organizations changed the nomenclature of their
personnel department to human resource ‘department to reflect the contemporary view.
Even the American Society for Personnel Administration, the largest professional association in
the field of human resource management, changed its name to the Society for Human Resource
Management in 1990. At the academic level, similar pattern was followed and the title of
personnel management course was changed to human resource management. Since then, the
expression is gradually replacing the hackneyed term ‘personnel management’.
•
• Functions of HRM:
Operative Functions
1. Recruitment: This is the most challenging task for any HR manager. A lot of
attention and resources are required to draw, employ and hold the prospective
employees. A lot of elements go into this function of recruitment, like developing a
job description, publishing the job posting, sourcing the prospective candidates,
interviewing, salary negotiations and making the job offer.
2. Training and Development: On the job training is the responsibility of the HR
department. Fresher training may also be provided by some companies for both
new hires and existing employees. This Fresher training is mainly done to make the
employees up to date in their respective areas as required by the company. This
function makes the employees understand the process and makes it easy for them
to get on their jobs with much ease. During the process of the training and
development, the results are monitored and measured to find out if the employees
require any new skills in addition to what he/she has.
3. Professional Development: This is a very important function of Human Resource
Management. This function helps the employees with opportunity for growth,
education, and management training. The organization undertakes to sponsor their
employees for various seminars, trade shows, and corporal responsibilities. This, in
turn, makes the employees feel that they have been taken care by their superiors
and also the organization.
4. Compensation and Benefits: A company can attain its goals and objectives if it can
acclimatize to new ways of providing benefits to the employees. Some of the
benefits given by companies are listed below for our understanding:
1. Working hour flexibility
2. Extended vacation
Professor. Meenal Gupta, ATSS CBSCA, Chinchwad. Unit- 1 Introduction to HRM

3. Dental/Medical Insurance
4. Maternal/Paternal Leave
5. Education Reimbursement for children
5. Performance Appraisal: The employees of any organization will be evaluated by the
HR department as per the performance. This function of Human Resource
Management is to help the organization in finding out if the employee they have
hired is moving towards the goals and objectives of the organization. On the other
hand, it also helps the company to evaluate whether the employees needs
improvement in other areas. It also helps the HR team in drawing certain
development plans for those employees who have not met the minimal
requirements of the job.
6. Ensuring Legal Compliance: To protect the organization this function plays a crucial
role. The HR department of every organization should be aware of all the laws and
policies that relate to employment, working conditions, working hours, overtime,
minimum wage, tax allowances etc. Compliance with such laws is very much
required for the existence of an organization.
Managerial Functions
1. Planning: This function is very vital to set goals and objectives of an organization.
The policies and procedures are laid down to achieve these goals. When it comes to
planning the first thing is to foresee vacancies, set the job requirements and decide
the recruitment sources. For every job group, a demand and supply forecast is to be
made, this requires an HR manager to be aware of both job market and strategic
goals of the company. Shortage versus the excess of employees for that given job
category is determined for a given period. In the end, a plan is ascertained to
eliminate this shortage of employees.
2. Organizing: The next major managerial function is to develop and design the
structure of the organization. It fundamentally includes the following:
1. Employees are grouped into positions or activities they will be
performing.
2. Allocate different functions to different persons.
3. Delegate authority as per the tasks and responsibilities that are
assigned.
3. Directing: This function is preordained to inspire and direct the employees to
achieve the goals. This can be attained by having in place a proper planning of
career of employees, various motivational methods and having friendly relations
with the manpower. This is a great challenge to any HR manager of an organization;
he/she should have the capability of finding employee needs and ways to satisfy
them. Motivation will be a continuous process here as new needs may come
forward as the old ones get fulfilled.
4. Controlling: This is concerned with the apprehension of activities as per plans,
which was formulated on the basis of goals of the company. The controlling function
ends the cycle and again prompts for planning. Here the HR Manager makes an
examination of outcome achieved with the standards that were set in the planning
stage to see if there are any deviations from the set standards. Hence any deviation
can be corrected on the next cycle.
5. Advisory Functions
Professor. Meenal Gupta, ATSS CBSCA, Chinchwad. Unit- 1 Introduction to HRM

1. Top Management Advice: HR Manager is a specialist in Human Resource

Management functions. She/he can advise the top management in formulating
policies and procedures. He/she can also recommend the top management for the
appraisal of manpower which they feel apt. This function also involves advice
regarding maintaining high-quality human relations and far above the ground
employee morale.
2. Departmental Head advice: Under this function, he/she advises the heads of
various departments on policies related to job design, job description, recruitment,
selection, appraisals.

• Challenges of HRM:
1.Engaging the Workforce
Employee engagement plays a significant role in the overall health and future possibility of any
organization. For that reason, HR departments have made it a top priority in their workforce
engagement strategies.
2. Management Changes
As a business develops, everything around it, including the structure, strategies, and internal
processes, evolves with it. Some employees often find it hard to cope with such changes, and as
a result, companies start to experience a decrease in productivity and morale.
3. Managing Relationships
The productivity and satisfaction of any organization depend on a fair-minded workplace with
open communication and dynamic relationships. Similarly, an organization’s well-being relies on
its assumptions about what its workforce truly values and anticipates. To facilitate healthy,
productive relationships, employers should consider feedback an essential feature of a
competitive workplace.
4. Leadership Development
Leadership development is another challenge that continues to affect human resource
management day in and out. Therefore, HR departments have solidified ways to provide their
professionals with essential tools, structures, processes, and points of view to select future
organizational leaders.
5. Recruiting Talented Employees
Recruiting talented employees calls for a significant investment of time and money, which is
why entrepreneurs find it challenging to balance between hiring the right people and keeping a
business running. Additionally, it can be downright frustrating to identify a potential candidate
until they’ve worked for you for a couple of months.
6. Training & Development Strategies
Let’s face it—running an organization without training and development strategies can be a
significant loss to HR departments and employers as well. Organizations need to allocate
adequate resources and emphasis towards this critical component of productivity and
satisfaction. Initially, training and development were perceived as a retrospective cost rather
than an investment into innovation, stability, and competitive advantage.
7. HR Effectiveness Measurement
Knowing how effective your organization is is very important. You can’t improve if your
organization doesn’t have the necessary tools to help you measure the effectiveness of your HR.
You need to measure results—transaction management and its influence on your business. And
most scholars have predicted that organizational effectiveness will be HR’s worst nightmare in
the future—so it would be better addressed now.
Professor. Meenal Gupta, ATSS CBSCA, Chinchwad. Unit- 1 Introduction to HRM

8. Workplace Diversity
There are a lot to talk about under workplace diversity—cultural and ethnic differences. In other
words, many generations must be treated equally. But that’s not just the only challenge
the Human Resource Management faces—failing to protect their employees from harassment
will also draw attention.
9. Employee Health & Well-Being
Living and staying healthy is instrumental in a person’s life—and that includes their career. And
because your employees are your most valuable assets, you need to ensure that they’re healthy,
productive, and satisfied at the workplace. According to Humana, 67 percent of healthy
employees are more effective. Therefore, you must maximize on collecting health for your
workforce and take advantage of the accompanying benefits.
10. Understanding Benefits Packages
One of the biggest nightmares of small businesses is the Affordable Care Act. Companies are
now forced to either take a hit or transfer the healthcare costs to the employees. And because
the best packages are deciding factors for potential recruits, it would help if you understood
them.

• Role of HR Manager:
1. Advisory Role: One of the major roles of HR manager is, to advise the top management in the
matter relating to management and development of human resource, in order to achieve
organizational objects. Looking to the company’s vision, mission and long range planning, HR
executive advises the higher management to formulate appropriate HR policies, procedures
which may create a perceptible change in the minds of the workers’ to help the
transformational process of dynamism.
2. Pro-Acting Role: HR manager ascertains the probable areas of conflict and differences
between workers and management, identifies the factors that may create problems in future,
forecasts the extent, quantum of loss that may occur and the department may suffer loss and
takes remedial measures beforehand by way of developing organizational culture, climate,
introducing system, mechanism, and does not leave any room to crop up problems, grievances.
3. Welfare Role: HR executive looks to the welfare aspect of the employee’s viz., canteen,
creche, rest-room, hospital, transportation, housing accommodation, school, etc. His one of the
principal roles is to provide welfare facilities to the employees for their betterment and well-
being.
4. Developmental Role: Development of workers for attaining company goals is made by the HR
manager through improvement of knowledge, skill, abilities, aptitude, attitude, value, beliefs
etc. A dynamic organization needs dynamic employees and transformation of employee’s mind-
set to the process of dynamism is possible only when all the potential areas for growth and
development are reinforced. HR manager takes all possible measures for growth and
development of employees through formulation of HR policies in the matter of training, career
planning and development, counselling etc.
5. Mediator’s Role: HR manager works as a link personality between trade unions and top
management in order to eliminate the differences of opinions cropped up in process of
settlement of disputes. He takes initiative to sort out problems through collective bargaining/
bipartite negotiation process.
Professor. Meenal Gupta, ATSS CBSCA, Chinchwad. Unit- 1 Introduction to HRM

6. Social Upliftment Role: Organization is part and parcel of the society. As a societal member it
has ethical and moral obligation to contribute to the society for its growth and development by
way of taking necessary measures like creating and improving infrastructure, spreading learning
institutions, providing medical facilities, generating employment opportunities. HR executive
plays a vital role to give a proper shape in the formulation of suitable HR policies for the people
in the society.
7. Counsellor’s Role: Because of illiteracy and ignorance workers cannot take decision in their
personal problems and they need advice to sort out such problems, viz. education of children,
medical treatment, marital matter, family problems, etc. HR manager, as he comes close to the
workers because of his nature of work, develops understanding between them and advises,
guides the workers in right direction.
8. Spokesperson Role: HR executive works as a spokesperson of the company especially, in the
matter of depicting organization health, condition, strength etc. to the employees while
negotiating for settlement of industrial disputes. He also acts as a representative of the workers
when they are nonunionized/unorganized and cannot represent their case properly to the top
management. Under such circumstances HR manager places their grievances, problems,
demand to the top management for settlement/redressal.
9. Motivator’s Role: One of the functions of HR manager is to motivate the employees to
achieve their own goals, as well as organizational goals HR manager performs such role by way
of introducing reward schemes. HR manager’s role of establishing mutual understanding,
mutual confidence and mutual trust helps to motivate the employees to excel in the level of
their performance.
10. Procurer’s Role: HR manager helps to procure the right number and right kind of people at
the right time, to enable the company to run smoothly, effectively and efficiently and to achieve
its goals. He facilitates formulation of a dynamic recruitment policy, designs and develops
Test/Interview techniques, selection process, suiting individuals and organization requirement
in order to find out the right persons for the required jobs. He makes a systematic, problem free
procurement exercise when workers express happiness, satisfaction and a state of contentment.
11. Change Agent Role: In changing scenario, workers are required to change their attitudes,
belief, perceptible state, values to meet organization needs, requirement and expectation. In
the age of stiff competition organization can survive and develop only if the workers are
adaptive to change requirement. It is the HR executive who through establishment of sound
human relation convinces the workers about the necessity of changing attitude, values to accept
change role, as reinforced by introduction of OD programme, TQM concept, quality circle etc.
12. Maintenance Role: HR manager plays a pivotal role to retain the dynamic, excellent, highly
skilled workers by providing attractive compensation package, introducing reward management,
career planning and development, welfare, fringe benefits and social security schemes. Suitable
policies are formulated, programmes are designed, necessary measures are taken to implement
schemes for growth and development of employees, with and through the active efforts of the
HR manager.
13. Disputes Prevention Role: HR manager takes remedial measures-curative and prophylactic
to redress and prevent grievances, disputes in order to bring harmony and peace in an
organization through introducing, grievance handling machinery, collective bargaining process,
rational approaches to discipline management, quality of working life, participative concept and
the like. HR executive creates congenial and conducive climate in the company by eliminating
differences between management and workers and developing understanding on the basis of
mutuality.
Professor. Meenal Gupta, ATSS CBSCA, Chinchwad. Unit- 1 Introduction to HRM

14. Executive Role: HR manager plays an important role to execute the policies, programmes,
decisions. Formulation and execution tasks are interwoven and equally important for
achievement of organizational goals. HR manager acts as an executor of the policy decisions in
the company, for smooth functioning and effectiveness of the organization.
15. Decision Maker’s Role: HR manager is the supreme person to make decisions in respect of
management and development of human resource. Organizational policies, programmes
objectives concerning human resource are formulated by him.
16. Coordinator’s Role: HR executive coordinates the task of developing, interpreting of HR
programmes, policies which are put into operation by the line people, and develops a team
spirit amongst them.
17. Strategist Role: HR manager helps to accomplish business strategy of the organization
through introducing and implementing HR strategies.
18. Monitoring Role: HR manager acts as regulator/monitor to ensure, that HR policies,
procedures, programmes, so formulated are monitored effectively to meet the objectives.
• Difference between HRM& Personnel Management:
1. Meaning
Personnel management is a traditional approach of managing employees within an organization,
whereas human resource management is a modern approach that concentrates on the most
efficient use of human resources in the organization.

2. Nature
Personnel management is a routine function, while human resource management is a strategic
function.

3. Priority
Personnel management gives priority to efficient management, while treating workers as tools.
On the other hand, human resource management gives priority to human needs and
requirements, considering human resources as assets.

4. Remuneration
Personnel management provides remuneration to its employees on the basis of job evaluation,
while in human resource management, performance evaluation is carried out to provide
remuneration to employees.

5. Key functions
The main functions of personnel management include personnel administration, employee
welfare and relations with labor. The main functions of human resource management are
acquiring, developing, using and maintaining human resources.
6. Viewpoint
Personnel management considers the employees as being the fundamental input needed to
achieve the required outcomes, while human resource management considers the workforce to
be strategic and a very important resource to achieve the required outcomes.
Professor. Meenal Gupta, ATSS CBSCA, Chinchwad. Unit- 1 Introduction to HRM

7. Fulfillment of job requirements

The basis of job design in personnel management is division of labor, while in human resource
management, teams or groups are formed to carry out any task.

8. Stress upon
The stress in personnel management is on following rules and policies of the organization, while
human resource management stresses on integrating the competencies and skills of the
workforce.

9. Oriented towards
Personnel management is aligned towards discipline, control and direction, while
the orientation of human resource management is towards development, where space is given
to the employees for performing and growing.