Note for Management Science - MS by shafi ullah

Topics ( 5 )

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MS Units 5 to 8 UNIT 5 Q. (1) What do you understand by HRM? Explain how it is important for organizational development? (or) HRM in an organisation is the most challenging function. Explain. (or) “HRM is dynamic and undergoes transformation”. Explain. • • • • • • • • • Human Resources Management (HRM) can be defined as “the process of acquiring, training, appraising and compensating employees and attending to the relations with labour, their health and safety issues”. Human Resources Management (HRM) is the process of managing the human resources of an organization in tune with the top management. Human resources are assuming increasing significance in modern organizations due to the dynamic technological changes taking place. It is through managing the human resources that the management of an organization attempts to convert its vision and mission into action. HRM is a strategically driven process. It represents an intensely-unified and holistic approach. An organization’s performance and the final output are directly proportional to the quantity and quality of its human resources. Majority of the problems in organizations are of human nature rather than physical, technical or economic in nature. The failure to recognize this fact causes great loss to the organization. Human Resources Management is dynamic in nature because the environment is continually changing and the needs, wants and desires are also correspondingly undergoing a transformation. Management of human resources is considered as a specialized profession like medicine or law. Objectives of HRM: (1) To help the organization in realization of its goals; (2) To ensure effective utilization of human resources; (3) To ensure respect by providing various services and welfare facilities; (4) To identify and satisfy the needs of the employees by offering various monetary and non-monetary rewards; (5) To achieve and maintain high morale among employees in the organization by ensuring better human relations; (6) To improve better working conditions; and To improve employee morale and motivation through an improved three-way communication. 1

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MS Units 5 to 8 • HRM functions in organizations include the following: (i) Empowering employees and institutionalizing employee involvement; (ii) Focussing on productivity and team-building; (iii) Developing flatter organizational structures; (iv) Developing a more people-sensitive management style and organizational culture; (v) Developing human resource information system; (vi) Strengthening of organizational communications; and (vii) Evaluating self-appraisals and providing feedback. • The basic functions of a HR manager are: (i) Manpower planning; (ii) Recruitment; (iii) Selection; (iv) Training and development; (v) Placement; (vi) Promotion, transfer and separation; (vii) Wage and salary administration; (viii) Performance appraisal; (ix) Grievance handling; (x) Welfare administration. Human resource management encompasses several concepts and functions of management such as Personnel Management, Industrial relations and the recently emerging concept of Human Resources Development (HRM). Q. (2) What is HRM? How is it different from Personnel management? Explain. • • • Human Resources Management (HRM) is “the process of acquiring, training, appraising and compensating employees and attending to the relations with labour, their health and safety issues”. Personnel Management (PM) is “that phase of management, which deals with the effective control and use of manpower”. Personnel Management can also be defined as “the procurement, development, compensation, integration and maintenance of the personnel of an organization for the purpose of contributing towards the accomplishment of the goals of the organization”. Though both definitions sound similar, there are many conceptual differences between HRM and PM. 2

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MS Units 5 to 8 I. Beliefs and Assumptions Personnel Management: In the personnel management approach, there is a careful description of written contracts, importance is given to devising clear rules, procedures guide management action, and norms and practice trigger the behaviour of the employees. The manager is expected to monitor the work of the employees. The employees and management, throughout the organization, are considered as two different groups at continuous conflict with each other. Human Resources Management In the HRM approach, the aim is to go beyond the written contract. The employees are expected to develop the “can-do” outlook and are supposed to adopt impatience with the rules. The business needs of the organization guide management action. The behaviour of the employees is guided by the values/mission of the organization. The managerial task is that of nurturing the skills of the employees. The employees and the management are considered to be existing as a unit and conflict among them is de-emphasized. II. Strategic Aspects Personnel Management: In the personnel management approach, lot of time and effort is spent on ensuring good relations between labour and management. Only piece-meal initiatives are undertaken. The corporate plan of the organization is of short-term nature, with a marginal increase in plans. The decisions taken thus are slow. Human Resources Management In the HRM approach, the relations between customer and the organization are considered as key for its success. The initiatives are of integrated nature. The corporate plan takes a long-term vision and is comprehensive. Due to the clarity of the central plan, fast decisions are taken. III. Line Management Personnel Management: In the personnel management approach, the management role is transactional in nature. The personnel/industrial relations specialists are considered as the key managers as they are conversant with various aspects of industrial psychology and labour law. Negotiation skills with workers are considered as prized management skills. The communication between the management and workers is indirect. Human Resources Management In the HRM approach, the managers concentrate on transforming the workers into multi-skilled persons. Versatile General Managers with multi-faceted skills are the key managers. Facilitation skills (helping the workers achieve their potentials) are considered as prized management skills. The communication between the management and workers is direct. 3

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MS Units 5 to 8 IV. Key Levers Personnel Management: In the personnel management approach, selection is considered as separate from the routine tasks carried on by managers. Fixed grades of pay depending upon the employees’ experience exist. There are many categories and grades of jobs. Work is divided among employees based on their expertise. Whenever conflicts arise, temporary agreements are reached. Human Resources Management In the HRM approach, selection is considered as an integral part of the managers’ work. The remuneration of the employees is performance-related. Only a few categories and grades of jobs exist. Team work is encouraged. The work climate and culture are managed thus avoiding conflicts. Q. (3) What is manpower planning? What is the need for manpower planning? What are the steps in Manpower planning? Explain. • • • Manpower planning is a rational method of assessing the requirements of human resources at different levels in the organization. Manpower planning is concerned with the flow of people into and sometimes out of the organization. Its main objective is to acquire, utilize, improve and retain effectively the human resources to achieve the targeted results at different levels in an optimum manner. Need for manpower planning (i) Organizations need personnel with necessary qualifications, skills, knowledge, experience and aptitude to work. This could be effectively provided by manpower planning. (ii) There should be a plan for replacement of retired persons. (iii)Whenever the production capacity of the plant is increased, additional skilled employees are required. (iv) A change in technology may require employees who are capable of handling such technology. (v) In an organization, areas of surplus manpower and areas of shortage of manpower may need to be identified. Steps in Process of Manpower Planning Step 1: Deciding the goals and objectives; Step 2: Estimating future organizational structure and manpower requirements; Step 3: Auditing human resources; Step 4: Planning job requirements and job description; and 4