HRM notes

by Nafis Siddiqui on Saturday 29 October 2011, 9:44 PM | Category: Human Resource Management| View: 3741 views


Full-length questions (10 marks each)
Q 1. Describe the HRP process? Or what do you understand by manpower planning? Explain the steps in manpower planning?
The objectives of HR plan must be derived from organizational objectives. Specific requirements in terms of number and characteristics of employees should be derived from the organizational objectives.
Organizational objectives are defined by the top management and the role of HRP is to sub serve the overall objectives by ensuring availability and utilization of human resources. 
Once the organizational objectives are defined by the top management and the role of HRP is to sub serve the overall objectives by ensuring availability and utilization of human resources.
Once the organizational objectives are specified, communicated and understood by all concerned, the HR department must specify its objectives with regard to HR utilization in the organization. 
HR Demand Forecast
Demand forecasting is the process of estimating the future quantity and quality of people required. The basis of forecast must be annual budget and long-term corporate plan, translated into activity levels for each function and department.
There are several good reasons to conduct demand forecasting
Quantify the jobs necessary for producing a given number of goods
Determine what staff-mix is required
Asses appropriate staffing levels in different parts of the organization 
Prevent shortages of people
Monitor compliance with legal requirements with regard to reservation of jobs
HR Supply Forecast
Personnel demand analysis provides the manager with the means of estimating the number and kind of employees that will be required. The next logical step for the management is to determine whether it will be able to procure the required number of personnel and the sources for such procurement. This information is provided by supply forecasting. Supply forecasting measures the number of people likely to be available from within and outside an organization, after making allowance for absenteeism, internal movements and promotions, wastage and changes in hours, and other conditions of work.
reasons for supply forecast are
Helps quantify number of people and positions expected to be available
Helps clarify staff mixes that will exist in the future
Assess existing staffing levels in different parts of the organization
Prevents shortage of people 
Monitors expected future compliance with legal requirements of job reservations
HR Programming
Once an organization's personnel and supply are forecast, the two must be reconciled or balanced in order that vacancies can be filled by the right employees at the right time.
HR Plan Implementation
Implementation requires converting an HR plan into action. A series of action programmes are initiated as apart of HR plan implementation.
Recruitment, Selection and Placement – after the job vacancies are known, efforts must be made to identify sources and search for suitable candidates. The selection programme should be professionally designed.
Training and Development – The training and development programme should cover the number of trainees required and programmes necessary for existing staff
Retraining and Redeployment – new skills are to be imparted to existing staff when technology changes
Retention Plan – retention plan covers actions which would help reduce avoidable separations of employees.
Downsizing – where there is surplus employee, trimming of labour force will be necessary
Control and Evaluation
Control and evaluation represents the fifth and the final phase in the HRP process. The Hr plan should include budgets, targets and standards. It should also clarify responsibilities for implementation and control, and establish reporting procedures, which will enable achievements to be monitored against the plan.
Q 2. What are personnel manual and how is it designed?
Personnel policies are the principles and rules of conduct which "formulate, redefine, break into details and decide a number of actions" that govern the relationship with employees in the attainment of the organization objectives. The scope of personnel policies is vast arid employees from all departments are covered by personnel policies.
According. to Edwin B. Flippo, "A policy is a man-made rule: or pre-determined course of action that is established to guide the performance of work toward the organization objectives. It is a type of standing plan that serves to guide subordinates in the execution of their tasks. "
According to Calhoon, "Personnel policies constitute guides to action. They furnish the gei1eral standards or bases on which decisions are reached. Their genesis lies in an organization's values, philosophy, concepts and principles."
Preparation of personnel policy manual is a lengthy, costly and time-consuming activity. It involves lot of administrative work. Many persons are involved in this joint/collective activity. 
Lengthy procedure involved: The steps to be taken for the preparation of personnel policy manual depend on the material on policy manual already available. If personnel policies on various aspects of personnel management have already been written, the task consists of gathering the policies together, arranging them in a logical order and writing them according to some acceptable format. Each policy needs to be placed properly so that the manager using the manual will understand all aspects (objectives, application, etc.) of the policy easily, quickly and correctly.
 Firm decision to prepare policy manual: The decision to prepare a manual is to be taken by the top management of the company. It also has to decide who is going to be in charge of its preparation. It is desirable to make one person responsible for the drafting of the manual.
 Giving suitable authority to In charge, Personnel Policy Manual: The person appointed for the preparation of the manual should be given authority to set up a small committee which will assist in gathering the data necessary for the preparation of complete and comprehensive manual. The major sources of information should also be decided. In some cases, manual preparation is the revision and updating of the old manual or preparation of new manual.
 Appointing of a small committee for manual preparation: The committee set up for the preparation of manual should be small and functional. The initial task of the committee is to collect data from individual departments. There should be time limit for the preparation of final draft of the manual.
 Interviewing supervisors for information collection: The supervisors are mainly responsible for administering company policies and practices. The supervisors should be interviewed for understanding what is going on in the company at present. They (supervisors) will be useful in finding out whether the present policies (written or unwritten) are working and where they are not working. Association of supervisors is important as it gives them opportunity to participate in the preparation or in the revision of the personnel manual.
Preparing first draft of policy manual: After collecting the required data, views of supervisors, etc, the first draft of personnel policy manual should be prepared. The language of the draft should be clear. The first draft of the manual should be flexible and open to additions and changes. 
Circulating first draft for review and recommendations: Copies of the first draft should be taken and circulated among the supervisors and others directly concerned with the use of the manual. Their opinions should be collected for the preparation of final draft of the manual. 
Final printing of manual: The manual maybe large in the case of a large organization manufacturing and marketing wide product line.. A manual should have printed pages with proper binding so as to make it available in a book form. Sometimes, it is prepared in a loose-leaf form. A printed manual in book form can be used for a longer period of three to five years. Thereafter, new updated and revised manual can be introduced by discarding the old one.
Periodical revision and updating of the manual: Periodical revision and updating of personnel policy manual is necessary due to organizational and other changes. The jobs of manual preparation are never finished as conditions inevitably and continuously change.
A personnel manager /HR manager or a manual coordinator should be appointed for this job here; he can draft the manual by using the steps noted above. The steps serve as guidelines for manual drafting.
Q 3. Why and how does job rotation take place? (Concept question)
Job rotation implies movement of employees from one job to another.
With job rotation, a given employee performs different jobs, but more or less of the same nature.
When an activity is no longer challenging, the employee would be rotated to another job at the same level that has similar skill requirements.
Advantages of Job Rotation-
Job rotation is a way to overcome boredom and monotony.
It is likely to increase intrinsic reward potential of a job because of different skills and abilities needed to perform it.
Workers become competent in several jobs rather than only one, which in turn benefits the organization.
Knowing a variety of jobs improve the worker's self-image, provides personal growth and makes the worker more valuable to the organization.
Periodic job changing can also improve interdepartmental co-operation, employees become more understanding of each other's problems.
Disadvantages of Job Rotation
An employee does not gain a particular specialization.
Moving from one job to another also gets irritating because the normal routine of an employee is disturbed and also time is wasted in adjusting to the new job. The employee may feel alienated when he/she is rotated from job to job.
Training costs are increased
Q 4. Why and how does a transfer take place?
Firstly what is a transfer? A transfer involves a change in the job (accompanied by a change in the place of the job) of an employee without a change in responsibilities or remuneration. A transfer differs from a promotion in that the latter involves a change in which a significant increase in responsibility, status and income occurs, but all these elements are stagnant in case of a transfer. Another difference is that transfers are regular and frequent, as in banks and other government establishments, but promotions are infrequent.
Reasons for transfers
The reasons for transfers vary from organization to organization and from individual to individual within an organization. Broadly speaking, the following are the reasons for transfers:
There is a shortage of employees in one department or plant because of a heavy demand, which necessitates a requirement of more employees. In another department or plant, employees may be surplus because of slackened demand for the products manufactured by the company. This will lead to workers being idle and wastage of manpower. Workers are thus transferred from the surplus department to another department or plant where there is shortage of staff.
Incompatibilities between the worker and his or her boss or between one worker and another worker.
Correction of a wrong initial placement of an employee.
A change has taken place in the interests and capacities of an individual, compelling him to transfer to a different job.
Over a period of time, the productivity of an employee may decline because of the monotony of his or her job. To break this monotony, the employee is transferred.
The climate may be unsatisfactory for an employee's health. He or she may request a transfer to a different place where his or her health will not be affected by the climate.
Family related issues cause transfers, especially among female employees like when they get married and want to join their husbands.
Types of transfers
Production transfers – as mentioned earlier, a shortage or surplus of the labour force is common in different departments in a plant or several plants in an organization. Surplus employees in a department have to be laid off, unless they are transferred to another department. Transfers affected to avoid such imminent lay-offs are called production transfers.
Replacement transfers – replacement transfers are too intended to avoid imminent lay-offs, especially of senior employees. A junior employee may be replaced by a senior employee to avoid laying off the senior one. A replacement transfer usually takes place when all the operations are declining and it is carried out to retain long-service employees as long as possible.
Versatility transfers – versatility transfers are done to make employees versatile and competent in more than one skill. Clerical employees in banks, for example are transferred from one section to another so that they acquire the necessary skills to attend to the various activities of the bank. Versatile transfers may be used as a preparation for production or replacement transfers.
Shift transfers – generally speaking, industrial establishments operate more than one shift. Transfers between shifts are common, such transfers being made mostly on a rotation basis. Transfers may also be effected on special requests from employees. Some request a transfer to the second shift or the night shift in order to avail the free time during the day to take up part time jobs.
Remedial transfers – remedial transfers are effected at the request of employees and are therefore called personal transfers. Remedial transfers take place in instances like 
ü the initial placement of an employee may have been faulty or 
ü the worker may not get along with his or her supervisor or with other workers in the department
ü he or she may be getting too old to continue in his or her regular job or
ü the type of job or working conditions may not be well adapted to his or her personal health
ü if the job is repetitive, the worker may stagnate and in all such instances 
      The employee would benefit by transfer to a different kind of work. 
Q 5.  Explain the HRM Model?
                      Nature of HRM
Job Analysis
Training and
Safety and
Promotions etc
Trade Unionism
And their
Future of HRM
The HRM model contains all HR activities. When these activities are discharged effectively, they will result in a competent and willing workforce who will help realize organizational goals. There is another variable in the model – environment. It may be stated that the HR function does not operate in vacuum. It is influenced by several internal and external forces like economic, technological, political, legal, organizational, and professional conditions.
HRM: is a management function that helps manager's recruit, select, train, and develop members for an organization.
Human Resource Planning: is understood as the process of forecasting an organizations future demand for, and supply of, the right type of people in the right number.
Job Analysis: is the process of studying and collecting information relating to the operations and responsibilities of a specific job. The immediate products of this analysis are job descriptions and job specification.
Recruitment: is the process of finding and attracting capable applicants for employment. The process begins when new recruits are sought and ends when their applications are submitted. The result is a pool of applicants from which new employees are selected.
Selection: is the process of differentiating between applicants in order to identify (and hire) those with greater likelihood of success in a job.
Placement: is understood as the allocation of people to jobs. It is the assignment or re-assignment of an employee to a new or different job.
Training and development: it is an attempt to improve current or future employee performance by increasing an employee's ability to perform through learning, usually by changing the employee's attitude or increasing his or her skills and knowledge. The need for training and development is determined by employee's performance deficiency, computed as follows:
Training and development need = Standard performance – Actual performance
Remuneration: is the compensation an employee receives in return for his or her contribution to the organization.
Motivation: is a process that starts with a psychological or physiological deficiency or need that activates behavior or a drive that is aimed at a goal or an incentive.
Participative management: Workers participation may broadly be taken to cover all terms of association of workers and their representatives with the decision making process, ranging from exchange of information, consultations, decisions and negotiations to more institutionalized forms such as the presence of workers members on management or supervisory boards or even management by workers themselves as practiced in Yugoslavia. ((ILO)
Communication: may be understood as the process of exchanging information, and understanding among people.
Safety and health: Safety means freedom from the occurrence or risk of injury or loss. In order to ensure the continuing good health of their employees, the HRM focuses on the need for healthy workers and health services.
Welfare: as defined by ILO at its Asian Regional Conference, defined labour welfare as a term which is understood to include such services, facilities, and amenities as may be established in or in the vicinity of undertakings to enable the person employed in them to perform their work in healthy, congenial surroundings and to provide them with amenities conducive to good health and high morale.
Promotions: means an improvement in pay, prestige, position and responsibilities of an employee within his or her organization.
Transfer: involves a change in the job (accompanied by a change in the place of the job) of an employee without a change in the responsibilities or remuneration.
Separations: Lay-offs, resignations and dismissals separate employees from the employers.
Industrial relations: is concerned with the systems, rules and procedures used by unions and employers to determine the reward for effort and other conditions of employment, to protect the interests of the employed and their employers, and to regulate the ways in which employers treat their employees.
Trade Unions: are voluntary organizations of workers or employers formed to promote and protect their interests through collective action.
Disputes and their settlement: Industrial disputes mean any dispute or difference between employers and employers, or between employers and workmen, or between workmen and workmen, which is connected with the employment or non-employment or terms of employment or with the conditions of labour of any person.
Concept Testing Questions
Q 1. Meaning and Definition (of all concepts for every chapter)
Q 2. Difference between: personnel management and HRM
Dimension Personnel Management
1. Employment contract Careful delineation of written contracts Aims to go ‘beyond' contract.   
2. Rules Importance of devising clear rules Can do, outlook, impatience with rule   
3. Guide to management action Procedures Business need   
4. Behaviour referent Norms/ customs and practices Values/mission   
5. Managerial task vis-à-vis labour Monitoring Nurturing   
6. Key relations Labour management Customer   
7. Initiatives Piecemeal Integrated   
8. Speed of decision Slow Fast   
9. Management role Transactional Transformational leadership   
10. Communication Indirect Direct   
11. Prized management skills Negotiation Facilitation   
12. Selection Separate, marginal task Integrated, key task   
13. Pay Job evaluation Performance related   
14. Conditions Separately negotiated Harmonization   
15. Labour management Collective-bargaining contracts Individual contracts   
16. Job categories and grades Many Few   
17. Job design Division of labour Team work   
18. Conflict handling Reach temporary truce Manage climate and culture   
19. Training and development Controlled access to courses Learning companies   
20. Focus of attention for interventions Personnel procedures Wide ranging cultural, structural and personnel strategies   
21. Respect for employees Labour is treated as a tool which is expendable and replaceable People are treated as assets to be used for the benefit of an organization, its employees and the society as a whole   
22. Shared interest Interests of the organization are uppermost Mutuality of interests   
23. Evolution Precedes HRM Latest in the evolution of the subject  
GROUP 1 (Topics covered)
Personnel management
Human resource management
Strategic HRM
New trends in HRM
1] Personnel management
The term personnel management is defined in different ways. The following definitions are worth noting:
(1) According to Edwin Flippo" Personnel management is the planning, organizing, directing, and controlling of the procurement, development, compensation, integration, maintenance, and separation of human resources to the end that individual, organizational and societal objectives are accomplished".
(2) According to George R. Terry, "Personnel management is concerned with the obtaining and maintaining of a satisfactory and satisfied, work force".
(3) According to Walter D. Scott, "Personnel management is concerned with the attaining of maximum individual development; desirable working relationship between employer and employees, and an effective moulding of human resources as contrasted with physical resources".
(4) According to British Institute of Personnel Management, London, "Personnel Management is that part of management which is concerned with the people at work and with their relationship within an enterprise".
The basic objective of personnel management is to maintain efficient team of workers for the benefit of the organization. In addition, to provide opportunities of self-development to employees and finally to maintain congenial work atmosphere and inter-personnel relations are the objectives of personnel management. Personnel management aims at giving fair treatment to employees as regard wages, 'welfare facilities, non­-monetary benefits, working conditions and so on.
The objectives of HRM are derived from the basic objectives of an organization. In order to achieve organizational objectives, integration of employer's interest and employee interests is necessary.
The objectives of personnel management/HRM in any industrial organization can be summarized as under.
(1) To attain maximum individual development (self-development) of the members of an organization and also to utilize available human resources (with the organization) fully and effectively.
(2) To mould effectively the human resources.
(3) To establish desirable working relationships between employer and employees and between groups of employees.
(4) To ensure satisfaction to the workers so that they are freely ready to work.
(5) To improve the service rendered by the enterprise to the society through better employee morale, which leads to more efficient individual and group performance.
(6) To establish and maintain a productive and self respecting relationship among all the members of an organization.
(7) To ensure the availability of a competent and willing workforce to the organization for its progress and prosperity.
(8) To help organization to achieve its goals by providing well trained, efficient and properly motivated employees.
(9) To maintain high morale and good human relations within the organization for the benefit of employer and employees.
(10) To secure the integration of all the individuals and groups with the organization by reconciling individual/group goals with those of an organization.
2] Human resource management
Personnel refer to the employees working in an organization at different levels. Personnel management (also called human resource management) is that aspect of total business management, which deals with human relationships within an organization. Personnel represent human resource, which is different from material resources.
Human resource is the most productive and most versatile. In addition, the manpower in an organization needs human treatment. Employees have a capacity to feel, think and even to react. Management has to deal with the employees in a careful and tactful manner. Material resources such as land, machines, raw materials, equipment, etc. are easy to manage. This is because they have no capacity to feel or think or react. This is not the case with human resource i.e. manpower. Man and machines are not on par and must not be treated in the same manner. This is because of all the resources manpower is the only resource, which does not depreciate, with the passage of time. According to Peter F. Druckert Utile prosperity, if not the survival of any business depend on the performance of its managers of tomorrow." The material resources alone will not help the organization to achieve its objectives. For this, effective co-ordination and utilization of material and human resources are required. This suggests the importance of human resources.
The human resource is very important and useful. It should be nurtured and used for the benefit of the organization. This is a challenging job before personnel manager/management. The organization can make rapid progress only when the employees are satisfied and co-operative. On the other hand, the organization will have to face various problems and difficulties, if the employees are not co-operative but hostile. This indicates that human resource is most strategic and critical determinant of growth of a business unit. Every organization needs loyal, efficient and satisfied labour force. For this, adequate attention should be given to personnel management.
Same as objectives of personnel management (given above)
A personnel manager has to perform the basic functions of management. These managerial functions include' planning, organizing, directing and controlling personnel. The operative functions of the department are: procurement of staff, development of staff through training, payment of compensation to staff i.e. wages and salaries, integration of manpower i.e. fair reconciliation of individual, social and organizational goals and interests and maintenance of staff i.e. providing them safety at the work place and also to offer welfare facilities and conveniences to employees. In brief, personnel management involves the following operational functions:
Procurement of manpower: Procurement means acquiring the manpower required by an organization from time-to-time. The basic Principle in procurement is "right man for the right job". The procurement function includes manpower planning and forecasting, recruitment, selection, appointment, placement and induction of employees so as to have a team of efficient and capable employees for the benefits of the organization. Even promotions and transfers are covered by this broad personnel function. 
Development of manpower: Development of manpower (human resource development) means planning and execution of the training programmes for all categories of employees in order to develop new skills and qualities required for working at the higher level. Manpower development is possible through training and career development programmers and not simply by offering attractive wages to workers. Executive development programmers are introduced for the benefit of higher-level managers similarly; future manpower requirement will be, met internally through HRD programmers. It aims at educating and training employees for the improvement of overall performance of an organization. HRD (Human Resource Development) programmers are for education, training and development of existing manpower in an organization. This is for facing new problems and challenges likely to develop in the near future.
 Compensation payment to manpower employed: One function of HRM is to pay compensation (in monetary form) to employees for the services rendered. For this, a fair system of remuneration payment (wages and salaries) needs to be introduced. Remuneration to employees should be attractive so that the labour force will be satisfied and disputes, etc. will be minimized. Fair wage payment acts as a motivating factor. 
Integration of interests of manpower and the organization: Manpower is interested in wage payment while organization is interested in higher profits, consumer loyalty, and market reputation and so on. HRM has to reconcile the interests of the individual members of the organization with those of the organization. 
 Maintenance of manpower: This manpower function relating to maintaining satisfied manpower in the organization through the provision of welfare facilities. For this, attention needs to be given to health and safety measures, maintenance of proper working conditions at the work place, provision of welfare facilities and other non-monetary benefits so as to create efficient and satisfied labour force with high morale. Even collective bargaining and workers participation come within this broad personnel function. 
 Provision of welfare facilities: Employees are offered various welfare facilities. They include medical, educational, recreation, housing, transport and so on. 
Misc. functions: Misc functions under HRM include maintenance of service records of employees (which are used for promotions/transfers performance appraisal, etc.), promotions and transfers of employees, maintaining cordial industrial relations, introduction of rational grievance procedure, performance evaluation of employees, career planning of employees, maintenance of discipline, administering the policies with regard to disciplinary action and compliance of various labour laws. 
The importance of personnel/human resources management is now universally accepted and India is not an exception to this rule. In India, large business enterprises, public sector enterprises and even medium and small enterprises appoint personnel manager or human resources development (HRD) manager to look after the personnel functions such as recruitment, promotions and transfers, training and manpower development, provision of welfare facilities, compensation management and so on. The term HRM is a relatively new term emerged during the 1970s. It is now used as a better and meaningful substitute to personnel management. HRM is wider in scope and has its distinct philosophy.
The process of industrial development started in India rather late. It was during the British Rule and that too after the First World War that textile, jute, iron and steel and other organised industries started in India. Recruitment, wage payment, welfare facilities and other personnel problems were noted only when labour class was employed on a large scale in the industrial sector. This is the starting period for personnel management in India. In the early British period and prior to that personnel management and personnel functions were absent, (Reference to some personnel functions and systematic management of resources was made in Kautilya's Arthashastra during the 4th century Be.) as industrial activities were extremely limited. They were also conducted on a small scale. As compared to India, the industrial growth was rapid in Europe. As a result, the concept of personnel functions and personnel management made rapid progress. The concept of personnel management function in India is based on similar concept developed in Europe much earlier.
The personnel function in India has been the product(outcome) of various factors such as industrial growth, labour, legislation, exploitation of workers in the early period and their demand for certain basic necessities of life. (e.g. fair wage, weekly, holiday, essential facilities at the work place)The need for labour officers in Indian industry was felt/realized as early as 1929 for the protection of labour force in industrial units. 
In 1931, the members of Bombay Mill owners' Association appointed Labour Officers in their textile mills (on voluntary basis) for the settlement of grievances and disputes of employees. Similar arrangement was introduced in the jute mills in Bengal (under the leadership of Jute Mills Association). The labour welfare officers were given the responsibility to promote sports and welfare activities and provide food shops (canteen facility) to workers. 
After Independence, many pro labour legislations were made for the protection and welfare of workers. The scope of personnel management function was made more broad and liberal. Many provisions regarding recruitment, salary payment and conditions of service were laid down. This gave recognition to the personnel management function in the industrial establishments.
Gradually, the need of personnel management and its role in cordial labour relations and fair treatment to employees need were recognized by industrial organizations. Personnel departments under the leadership of personnel managers were started in the companies. Liberal welfare facilities were introduced for the benefit of employees. Such measures taken for the protection and welfare of employees enlarged the scope of personnel management. Even training and manpower development programmes added new dimensions to the activities of personnel management. Many companies have now, prepared well-defined personnel policies, grievance and other procedures and liberal package of welfare facilities. Such additional activities/functions under personnel management raised the importance and popularity of personnel department. 
Explained above in the full length questions
Explained above in the concept testing question
With organizations achieving a HRD climate, a basic source of human motivation to perform higher, human wastage has been reduced. So, whereas personnel management regarded wages and salaries as the main source of motivation, Human Resource Management (HRM) regards creation of a congenial work climate (HRD climate), job challenges, creativity and opportunity for development as the motivating forces.
The challenges in HR that would be very critical are staffing. The biggest fear that such big corporate have is, if two or three wrong people get together, they can bring down the company. So, one is hiring the right kind of people, then right kind of values and the right kind of professional competencies.
The other challenge is to continuously allow people to develop and grow so that they have very high energy and the ability to energize others with the edge to resolve conflicts, and the ability to execute. You will also have to bear in mind that they also have aspirations. So managing the aspirations and rewarding them timely and accurately become critical in such organizations. 
A lot of companies expect their problems to disappear the moment HR is implemented. "HRM is a means to an end, not the end ". 
The other reasons why HR implementations often fail include lack of preparation, lack of top management involvement, faulty selection process, improper use of the HRM policies/department/funds, too high expectations.
Cost is an important factor while considering the implementation of HR activities. The companies are trying to cut costs while conducting HR programmes and are exorbitantly spending on other unimportant activities of the organization. 
HRM is still in its stage of infancy, it yet has to evolve and become more a way of doing business or managing the organization.
It shouldn't be used as a tool or remedial measure when the problem/ crisis arises.
Nowadays, the employees are being forced to attend self-improvement and overall development programmers compulsorily without the staff's knowledge/interest and companies are spending huge amounts on such welfare activities, which are absolutely redundant and should be eliminated from the system.
Pay packages and incentives have to be supplemented with some supplementary packages but the company tries to replace the monetary benefits by some workshops or seminars or presentations or training courses which demotivate the workers because their expectations are being ignored in the bargain. We look at the career development of people very strongly. We do not believe that we should be the highest paymasters.
3] Strategic hrm
Strategic Management is defined as ‘the set of managerial decisions and actions that determine the long-term performance of a corporation. It includes environmental scanning, strategy formulation, strategy implementation and evaluation and control. The study of strategic management, therefore, emphasizes monitoring and evaluating environmental opportunities and threats in the light of a corporation's strengths and weaknesses.'
The strategic management process involves the following four processes.
The advent of HRM has brought the linkage between employer-employee relationship and strategic management to sharp focus.
Since Environmental Scanning helps identify threats and an opportunity prevailing in the external and internal environment, HRM is of great help in locating opportunities and threats.
HRM is in a unique position to supply competitive intelligence that may be useful in Strategy Formulation. Details regarding advanced incentive plans being used by competitors, opinion-survey data from employees that elicit information about customer complaints and information about pending legislation like labour laws or mandatory health insurance are some examples. The strengths and weaknesses of a company's human resources can have a determining effect on the viability of a company's strategic options. Unique HR capabilities serve as a driving force in strategy formulation. A company may build it's new strategy around a competitive, advantage stemming from it's human resource. The well known accounting and consultancy firm, Arthur Anderson, developed unique HR capabilities in training, which provides the firm with a competitive advantage enabling it to provide fast and uniform in-house training.
HRM supplies a company with a competent and willing workforce which is responsible for executing strategies i.e. Strategy Implementation. For example Maruti Udyog and Hindustan Motors are manufacturing cars, essentially using identical technology. The secret behind the meteoric rise of Maruti is its workforce.
HRM supports strategy implementation in other ways too. For example human resource today is heavily involved in the execution of a company's restructuring and downsizing strategies, through out placing employees, instituting performance linked pay plans, reducing health care costs and retraining employees. And in an increasingly competitive global market place, instituting HR practices that build employee commitment can help improve an organization's responsiveness.
Lastly Human Resource Management must be continuously evaluated to make strategic management highly effective by supplying human resources who are competent and committed. Thus Strategic Human resource Management today is given due importance and offers several financial and non-financial benefits to a company.
4] New trends in hrm
MAINSTREAM economists perceive voluntary retirement as a measure to shed the workforce whose marginal productivity is zero. Further, it is argued that this could be introduced in an industrial organization for maintaining its cost effectiveness in an increasingly competitive world. Moreover, voluntary retirement is accompanied by technological modernization that warrants the replacement of labor with capital. Technological modernization improves the productivity of existing workforce so much so that a section of the existing workforce becomes again redundant even as modernization enhances the installed capacity of the technology. The workforce that becomes redundant in this process has to retire or be retrenched.
The rationale behind the introduction of voluntary retirement scheme (VRS) in India is that any organized industrial organization has to operate within the existing legislative framework, which does not allow the organization to shed the redundant workforce without adequate compensation
Employers refer to VRS as 'golden handshake', trade unions call it 'voluntary retrenchment scheme', and for the government, it is 'unstated exit policy' which means that an exit policy which may not exist on paper. VRS is one of the strategies introduced in the early 1980s in central public sector undertakings (PSUs) to reduce the so-called surplus or redundant workforce. It gained publicity after the introduction of new economic policy in 1991. In India, the government employs more than 70 per cent of the organized workforce; it uses all its channels to reduce the organized sector of the workforce without antagonizing the trade unions. It is envisaged in the new economic policy that VRS can provide minimum sustenance security to the retired individual and his family.
Trade unions play a crucial role in introducing the VRS in any organized sector firm.
The main objective behind the scheme is to send out those who cannot be retrained in new skills. The premise of the argument appears to be weak. The liberalization policy, in its anxiety to modernize, restructure and globalize the products of Indian industry, is wasting precious labor force that could have been modernized through retraining and on-the-job training. Precious skills and abilities of the retrenched workforce are equated with worn out physical capital that may not be susceptible to repair or modernization. Are human beings not capable of learning and modifying their knowledge, skills and applying the same to produce higher output? The current emphasis on restructuring does not allow such questions.
The free economy and trade liberalization have ushered in the need for the enterprises to have a competitive edge. Economic forces have led to organizational cost cutting, changes in production processes, exploration of new markets, plant relocations, modernizations, downsizing and structural changes.
Organizational adjustment at all levels has become extremely imperative. Over manning has crept into almost all industrial units on account of the inability of the enterprises to reduce or adjust workforce as per the business needs. The sort of cuts that only happened in heavy industries has now become widespread. The days of nibbling away deadwood have long gone. It's time for the organizations to realign and focus on the core competencies.
 Voluntary Retirement Scheme (VRS) is the latest mantra of many a corporate and Public sector units. The company may decide to declare a VRS based on their HR plan and suitability. For a common salaried individual this becomes a major decision.
The company as per their human resource policy declares VRS or the Voluntary Retirement Scheme. VRS is a scheme whereby the employee is offered to voluntarily retire from his services before his retirement date. Subject to certain conditions the company offers VRS to its employees It is the golden route to cut the excess flab. The most humane technique to retrench the employees in the company today is the voluntary retirement scheme. It is the golden handshake for the employees and the only option today for the companies to downsize their headcount. The scheme which is formally permitted by the Department of Public Enterprises and which provides the lucrative way for the employees to terminate their services and accept VRS.
This process should convince them that the posts in the organization have become redundant and not the person and the organization still values the person. Since this process involves emotions and feelings, every care must be taken by the management that the process must be carried out in such a manner that it keeps the dignity of the employees but at the same time achieves the objective in a tactful manner.
A "pink slip" is a notice of dismissal or termination from one's job, also known as one's "walking papers."  The term "pink slip" dates from the early 20th century, and originally referred to the practice of including a pink-colored slip of paper in an employee's weekly pay envelope notifying the worker of his or her termination.  There does not seem to be any particular significance to the use of the color pink aside from the fact that it made the notice stand out from any other papers that might be in the envelope.  
Though the "pink slip" in the pay envelope has probably been superseded by e-mail these days, "to be pink slipped" is still very much in use as shorthand for "to be fired."   
Information gathered from:
Human resource and personnel management-2nd edition -Aswathappa
Human Resources management-Kale & Ahmed
What are the challenges facing HRM? / Explain the changing role of HRM?
The 1990s have brought a revolutionary change in our business. Post- liberalisation is marked by a shift from command economy to market
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