Human Resource Management Guide - Functions and Importance of HRM

Human Resource Management – M.B.A. PRINCE
R a j a R a o P a g i d i p a l l i Page 1
INTRODUCTION
TO
HUMAN RESOURCE MANAGEMENT
P.RAJA RAO
M.B.A.(HRM), M.A.(ENG), M.Phil, (Ph.D.)

INTRODUCTION TO HRM
Introduction:
According to Leon C. Megginson, the term human resources (HR) can be thought of as
“the total knowledge, skills, creative abilities, talents and aptitudes of an organization’s
workforce, as well as the value, attitudes and beliefs of the individuals involved.” The
term human resources can also be explained in the sense that it is a resource like any
natural resource. It does mean that the management can get and use the skill,
knowledge, ability etc., through the development of skills, tapping and utilizing them
again and again by developing a positive attitude among employees. The aspect of
‘attitude’ among the human resources aspects gained significance along with
globalization. Managing of these human resources deals with the above areas and also
provides an answer to the question referred above. Now, we shall discuss the meaning of
human resources management (HRM) and other areas.
Meaning and Definition of HRM
In simple sense, human resources management means employing people, developing
their resources, utilizing, maintaining and compensating their services in tune with the
job and organizational requirements with a view to contribute to the goals of the
organization, individual and the society. Michael J. Jucius defined Personnel
Management as “the field of management which has to do with planning, organizing,
and controlling the functions of procuring, developing, maintaining and utilizing a
labour force, such that the:
ü Objectives for which the company is established are attained economically and
effectively,
ü Objectives of all levels of personnel are serve to the highest possible degree, and
ü Objective of society are duly considered and served.”
According to Pulapa Subba Rao, human resources management (HRM) is managing
(planning, organizing, directing and controlling) the functions of employing, developing,
compensating and utilizing human resources, resulting In the creation and development
of human and industrial relations which would shape the future policies and practices of
human resource management, with a view to contribute proportionately (due to them)
to the organizational, individual and social goals.

Differences between Personnel Management and Human Resources
Management:
Personnel Management is different from Human Resources Management. Personnel
means persons employed. Hence, personnel management views the man as economic
man who works for money or salary. Human resources management treats the people as
human beings having economic, social and psychological needs. Thus, HRM is broader
in scope compared to personnel management. John Storey differentiated personnel
management from human resources management.
Functions of HRM
The functions of HRM can be broadly classified into two categories:
Managerial functions and Operative functions.
I.Managerial Functions: Managerial functions of personnel management involve
planning, organizing, directing and controlling. All these functions influence the
operative functions.
v Planning:
It is a predetermined course of action. Planning pertains to formulating strategies
of personnel programmers and changes in advance that will contribute to the
organizational goals. In other words, it involves planning of human resources,
requirements, recruitment, selection, training etc.
v Organizing:
An organization is a means to an end. It is essential to carry out the determined
course of action. In the words of J.C. Massie, an organization is a “structure and a
process by which a co-operative group of human beings allocates its task among
its members, identifies relationships and integrates its activities towards a
common objective.”
v Directing:
The next logical function after completing planning and organizing is the
execution of the plan. The basic function of personnel management at any level is
motivating, commanding, leading and activating people. The willing and effective
co-operation of employees for the attainment of organizational goals is possible
through proper direction.
v Controlling:
After planning, organizing and directing various actives of personnel
management, the performance is to be verified in order to know that the
personnel functions are performed in conformity with the actual with the plans,
identification of deviations if any and correcting of identified deviations.

II. Operative Functions: The operative functions of human resources management
are related to specific activities of personnel management - Employment, Development,
Compensation and Relations. All these functions are interacted with managerial
functions. Further, these functions are to be performed in conjunction with
management functions.
1. Employment: It is the first operative function of HRM. Employment is concerned
with securing and employing the people possessing required kind and level of human
resources necessary to achieve the organizational objectives. It covers the functions such
as job analysis, HR Planning, recruitment, selection, placement, induction and internal
mobility.
Job Analysis: It is the process of study and collection of information relating to
the operations and responsibilities of a specific job. It includes collection of data,
information, facts and ideas relating to various aspects of jobs including men,
machines and materials.
Human Resources Planning: It is a process for determination and assuring
that the organization will have an adequate number of qualified persons,
available at proper times, performing jobs which would meet the needs of the
organization and which would provide satisfaction for the individuals involved. It
involves estimation of present and future requirements and supply of human
resources based on objectives and long range plans of the organization.
Recruitment: It is the process of searching for prospective employees and
stimulating them to apply for jobs in an organization. It deals with identification
of existing sources of applicants and creation/identification of new sources of
applicants.
Selection: It is the process of ascertaining the qualifications, experiences, skills,
knowledge etc., of an applicant with a view to appraising his/her suitability to a
job. This function includes:
ü Framing and developing application blanks.
ü Creating and developing valid and reliable testing techniques.
ü Formulating interviewing techniques.
ü Checking of references.
ü Placement:
ü Counseling the functional managers regarding placement.

ü Conducting follow-up study, appraising employee performance in order to
determine employee adjustment with the job.
ü Correcting misplacements, if any.
ü Induction and Orientation: Induction and orientation are the techniques by
which a new employee is rehabilitated in the changed surrounding and
introduced to the practices, policies, purposes and people etc., of the
organization.
II. Human Resources Development:
It is the process of improving, and changing the skills, Knowledge, creative ability,
aptitude, values, commitment etc., based on present and future job and organizational
requirements. This function includes:
ü Performance Appraisal: It is the systematic evaluation of individuals with
respect to their performance on the job and their potential for development. It
includes: Developing policies, procedures and techniques.
ü Training: It is the process of imparting to the employees technical and
operating skills and knowledge. It includes: 1. Identification of training needs of
the individuals and the company. 2. Developing suitable training programmes.
ü Management Development: It is the process of designing and conducting
suitable executive development programmes so as to develop the managerial
and human relations skill of employees. It includes: 1. Identification of the areas
in which management development is needed. 2. Conducting development
programmes.
ü Career Planning and Development: It is the planning of one’s career and
implementation of career plans by means of education, training, job search and
acquisition of work experiences. It includes internal and external mobility.
ü Internal Mobility: It includes vertical and horizontal movement of an
employee within an organization. It consists of transfer, promotion and
demotion.
ü Transfer: It is the process of placing employees in the same level jobs where
they can be utilized more effectively in consistence with their potentialities and
needs of the employees and the organization. It also deals with:
1. Developing transfer policies and procedures. 2. Guiding employees and line

management on transfers.
ü Promotion: It deals with upward reassignment given to an employee in the
organization to occupy higher position which commands better status and/or
pay keeping in view the human resources of the employees and the job
requirements.
ü Demotion: It deals with downward reassignment to an employee in the
organization.
ü Retention and Retrenchment Management: Employers prefer to retain
more talented employees while they retrench less talented employees.
Employers modify existing human resource strategies and craft new strategies
in order to pay more salaries provide more benefits and create high quality of
work life to retain the best employees. And managements pay less to the less
talented employees and plan to retrench the misfits as well as unwanted
employees depending upon the negative business trends.
ü Change and Organisation Development: Change implies the creation of
imbalances in the existent pattern or situation. Organisation development is a
planned process designed process designed to improve organizational
effectiveness and health through modifications in individual and group
behaviour, culture and systems of the organization using knowledge and
technology of applied behavioural sciences.
III. Compensation:
It is the process of providing adequate and fair remuneration to the employees. It
includes job evaluation, wage and salary administration, incentives, bonus, fringe
benefits, social security measures etc.
v Job Evaluation: It is the process of determining relative worth of jobs.
• Select suitable job evaluation techniques.
• Classify jobs into various categories.
• Determining relative value of jobs in various categories.
v Wage and Salary Administration: This is the process of developing and
operating a suitable wage and salary programme. It covers:
• Conducting wage and salary survey.
• Determining wage and salary rates based on various factors.

• Administering wage and salary programmes.
• Evaluating its effectiveness.
v Incentives: It is the process of formulating, administering and revising the
schemes of financial incentives in addition to regular payment of wages and
salary.
It includes:
• Formulating incentive payment schemes.
• Helping functional managers on the operation.
• Review them periodically to evaluate effectiveness.
v Bonus: It includes payment of statutory bonus according to the Payment of
Bonus Act, 1965 and its latest amendments.
v Fringe Benefits: These are the various benefits at the fringe of the wage.
Management provides these benefits to motivate the employees and to meet
their life’s contingencies.
These benefits include:
ü Disablement benefit.
ü Housing facilities.
ü Educational facilities to employees and children.
ü Canteen facilities.
ü Recreational facilities.
ü Conveyance facilities.
ü Credit facilities.
ü Legal clinics.
ü Medical, maternity and welfare facilities.
ü Company stores.
v Social Security Measures: Managements provide social security to their
employees in addition to the fringe benefits. These measures include:
¶ Workmen’s compensation to those workers (or their dependents) who
involve in accidents.
¶ Maternity benefits to women employees. Sickness benefits and medical
benefits.
¶ Disablement benefits/allowance.
¶ Dependent benefits.
¶ Retirement benefits like provident fund, pension, gratuity etc.

IV. Human Relations: Practicing various human resources policies and programmes
like employment, development and compensation and interaction among employees
create a sense of relationship between the individual worker and management, among
workers and trade unions and the management. It is the process of interaction among
human beings. Human relations is an area of management in integrating people into
work situations in a way that motivates them to work together productively, co-
operatively and with economic, psychological and social satisfaction. It includes:
¶ Understanding and applying the models of perception, personality,
learning, intra and inter-personal relations, intra and inter-group relations.
¶ Motivating the employees.
¶ Boosting employee morale.
¶ Developing the communication skills.
¶ Developing the leadership skills.
¶ Redressing employee grievances properly and in time b means of a well
formulated grievance procedure.
¶ Handling disciplinary cases by means of an established disciplinary
procedure.
¶ Counseling the employees in solving their personal, family and work
problems and releasing their stress, strain and tensions.
¶ Providing a comfortable work environment by reducing fatigue, monotony
boredom and industrial accidents.
¶ Improving quality of work life of employees through participation and
other means.
V. Industrial Relations: The term ‘industrial relations’ refers to the study of
relations among employees, employers, government and trade unions. Industrial
relations include:
ü Indian labour market
ü Trade unionism
ü Collective bargaining
ü Industrial conflicts
ü Workers’ participation in management and
ü Quality circles.
VI. Recent Trends in HRM: Human Resources Management has been
advancing at a fast rate. The recent trends in HRM include:
¶ Quality of work life
¶ Total quality in human resources
¶ HR accounting, audit and research and

¶ Recent techniques of HRM.
SEOPE OF HUMAN RESOURCES MANAGEMENT
The scope of human resources management in the modern days is vast. In fact, the
scope of HRM was limited to employment and maintenance of and payment of wage and
salary. The scope gradually enlarged to providing welfare facilities, motivation,
performance appraisal, human resources management, maintenance of human
relations, strategic human resources and the like. The scope has been continuously
enlarging.
The scope of Human Resources Management includes:
ÿ Objectives of HRM
ÿ Organisation of HRM
ÿ Strategic HRM
ÿ Employment
ÿ Development
ÿ Wage and salary administration/compensation
ÿ Maintenance
ÿ Motivation
ÿ Industrial relations
ÿ Participative management and
ÿ Recent developments in HRM.
IMPORTANCE OF HUMAN RESOURCES MANAGEMENT
Human resources play a crucial role in the development process of modern economics.
Arthur Lewis observed, “there are great differences in development countries which
seem to have roughly equal resources, so it is necessary to enquire into the difference in
human behaviour.” It is often felt that though the exploitation of natural resources,
availability of physical and financial resources and international aid play prominent
roles in the growth of modern economies, none of these factors is more significant than
efficient and committed manpower. It is in fact said that all development comes from
the human mind. Human Resources in the Nation’s Well-being
A nation with abundance of physical resources will not benefit itself unless human
resources make use of them. In fact, human resources with right attitude are solely
responsible for making use of national resources and for the transformation of
traditional economies into the modern industrial and knowledge economies. Man Vis-à-

vis Machine Most of the problems in organizational sectional sections are human and
social rather than physical, technical or economic. No industry can be rendered efficient,
so long as the basic fact remains unrecognized that it is principally human. It is not a
mass of machines and technical processes but a body of men.
HRM and General Management: Management of an organisational in modern
economies is not only complex and sophisticated but it is also vital influencing the
economic growth of a country. One of the fundamental tasks of management is to
manage human resources in the service of the economic objectives of the enterprise.
Successful management depends not solely, but significantly upon the ability to predict
and control human behaviour.
Role of HRM: Human Resources Management plays the most crucial role in the
management of an organization. Human resources play crucial role in the conversion
process of inputs. Product design, quality maintenance, rendering services etc., depend
upon the efficiency of human resources. Similarly, human resources plays critical role in
marketing the products and services. Human resource also plays significant role in
managing finances and managing information systems.
Objectives of HRM: Objectives are pre-determined goals to which individual or group
activity in an organization is directed. Objectives of HRM are influenced by social
objectives, organizational objectives, functional objectives and individual objectives.
Institutions are instituted to attain certain specific objectives. The objectives of the
economic institutions are mostly to earn profits, and that educational institutions are
mostly to impart education and/or conduct research so on and so forth. However, the
fundamental objective of any organization is survival. Organizations are not just
satisfied with this goal. Further, the goal of most of the organisations is growth and/or
profits.
The objectives of HRM may be as follows:
µ To create and utilize able and motivated workforce, to accomplish the basic
organizational goals.
µ To establish and maintain sound organizational structure and desirable working
relationships among all the members of the organization.
µ To secure the integration of individual and groups within the organization by co-
ordination of the individual and group goals with those of the organization.
µ To create facilities and opportunities for individual or group development so as to
match it with the growth of the organization.
µ To attain an effective utilization of human resources in the achievement of
organizational goals.

µ To identify and satisfy individual and group needs by providing adequate and
equitable wages, incentives , employee benefits and social security and measures
for challenging work, prestige, recognition, security, status etc.
HRM Objectives at Wipro
ü To respect the individual, as people are the greatest assets.
ü To govern individual and company relationships with the highest
standard of conduct and integrity.
ü To be close to the customer through employees.
ü To achieve and maintain leadership in people management.
HRM Policies, Procedures and Programmes:
After the establishment of objectives of HRM, human resources policies are to be
formulated Policies are general statements that guide thinking and action in decision-
making.
Definition of HRM Policy: A Policy is a plan of action. Brewster and Richbell defined
HRM policies as, “set of proposals and actions that act as a reference point for managers
in their dealings with employees”. “HR polices constitute guides to action. They furnish
the general standards or bases on which decisions are reached. Their genesis lies in an
organisation”s values, philosophy, concepts and principles”. HR policies guide the
course of action intended to accomplish personnel objectives.
What is HRM Procedure?
Policies are general instructions whereas procedures are specific applications. A
procedure is a well thought out course of action. It prescribes the specific manner in
which a piece of work is to be done. Procedures are called “action guidelines.” They are
generally derived from policies. Where policies define a broad field, procedures show a
sequence of activities within that area. The emphasis is on chronological, step-by-step
sequence of required actions. For instance, a student is required to complete several
itemized steps in order to register himself to complete several itemized steps for courses
in a university. The basic purpose of a procedure is to spell out clearly the way one is to
go about doing something.
Role of HR Manager:
Human Resources Manager plays a vital role in the modern organization. He plays
various strategic roles at different levels in the organization. Te roles of the HR Manager
include roles of conscience, of a counselor, a mediator, a company spokesman, a
problem solver and a change agent.

µ The Conscience Role: The conscience role is that of a humanitarian who
reminds the management of its morals and obligations to its employees.
µ The Counsellor: Employees who are dissatisfied with the present job approach
the HR manager for counseling. In addition, employees facing various problems
like marital, health, children education/marriage, mental, physical and career
also approach the HR managers. The HR Manager counsels and consults the
employees and offers suggestions to solve/overcome the problems.
µ The Mediator: As a mediator, the HR manager plays the role of a peace-maker.
He settles the disputes between employees and the management. He acts as a
liaison and communication link between both
µ The Spokesman: He is a frequent spokesman for of representative of the
company.
µ The Problem-solver: He acts as a problem solver with respect to the issues
that involve human resources management an overall long range organizational
planning.
µ The Change Agent: He acts as a change agent and introduces changes in
various existing programmes.
JOB DESIGN
Job design is defined as the process of deciding on the content of a job in terms of duties
and responsibilities of the jobholders; on the methods to be used in carrying out the job,
in terms of techniques, systems and procedures and on the relationships that should
exist between the job holder and his superiors, subordinates and colleagues. Factor
affecting job design include organizational factors, environmental factors and
behavioural factors. Two important goals of job design:
µ To meet the organizational requirements such as higher productivity, operational
efficiency, quality of product/service etc., and
µ To satisfy the needs of the individual employees like interests, challenges,
achievement or accomplishment etc. Finally, the goal of the job design is to
integrate the needs of the individual with the organizational requirements.
Approaches to job Design: There are three important approaches to job design viz.,
¶ (i) engineering approach
¶ (ii) human approach and
¶ (iii) job characteristics approach.
i. Engineering Approach: This approach which studies the work
scientifically is based on scientific management principles. These principles
seem to be quite rational and appealing as they point towards increased

organizational performance.
ii. Human Approach: Human relations approach to job design recognizes the
need to design the jobs which are interesting and rewarding.
iii. Job Characteristics Approach: This approach assumes that employees
will work hard when they are rewarded for the work they do and when the
work gives them satisfaction. Therefore, motivation, satisfaction and
performance should be integrated in the job design. Jobs with skill variety,
task identity, task significance, autonomy and feedback are called core job
dimensions. Core job dimensions will motivate the employees and result in
job satisfaction and high performance.
Job Rotation:
Job rotation refers to the movement of an employee from one job to another. Jobs
themselves are not actually changed, only the employees are rotated among various
jobs. An employee who works on a routine/respective job moves to and works on
another job for some hours/days/months and backs up to the first job. This measure
relieves the employee from boredom and monotony, improves employee’s skills
regarding various jobs, prepares the competent employees and provides competitive
advantage to the company These measures also improves worker’s self-image and
provides personal growth. However, frequent job rotations are not advisable in view
of their negative impact on the orgsnisation and the employee.
Job Enlargement:
Job enlargement means adding more and different tasks to a specialized job to
provide greater variety. This process is called horizontal job loading or horizontal job
enlargement. Job enlargement is a horizontal slice of the organization. It tackles
dissatisfaction and reduces monotony by increasing the variety and scope of tasks.
This technique leads to specialization, it improves worker satisfaction, quality of
production and overall efficiency of the organization.
Job Enrichment:
Job enrichment loads the job vertically. Job enrichment means adding duties and
responsibilities that will provide for skill variety, task identity, task significance,
autonomy and feedback on job performance. It tries to deal with dissatisfaction by
increasing job depth as work activities from a vertical slice of the organizational unit
are combined in one job. As work becomes more challenging and worker
responsibility increases, motivation and enthusiasm also increase. Dale S. Beach has
suggested specific action steps for designing enriched jobs. They are:

ü Creation of natural or logical work units,
ü Combining several duties, requiring various skills into each job,
ü The employee should have direct contact and knowledge about the people for
whom his product is meant,
ü Vertical job loading is to incorporate some planning and controlling duties into
the job and
ü Feedback information should be provided to employees to correct and improve
their performance.
JOB ANALYSIS
Procurement is the first operative function of personnel management,
which can be sub-divided into various sub-functions like human resources
planning, recruitment and selection. Management should determine the kind of
personnel required for a job and the number of persons to be employed. The
organization should also find out the right man for the right job in the right time.
The knowledge of the job is essential to perform these functions. In addition,
establishment of the scientific standard in advance is comparing the applicants
with the job and to select the suitable personnel. This standard stipulates the
minimum acceptable qualifications, skills and qualities required for adequate job
performance. Stipulating the standard requires the knowledge regarding job
design, study of the job duties and responsibilities, requirements of the job,
human abilities and qualities etc. job analyst is needed to know all these
functions and to perform various functions of HRM.
¶ Job Terminology: Description of technical terminology is highly necessary in
order to facilitate the study of a job analysis. So, it is desirable to define the terms
related to job analysis like task, position, job, occupation, job analysis, job
description, job specification and job classification.
¶ Task: A task is an action or related group of action designed to produce a definite
outcome or result.
¶ Position: A position is a group of similar tasks and responsibilities assigned to
one individual. The term is used in this narrow technical sense to facilitate more
precise discussion of the job analysis technique.
¶ Job: A job is “a group of positions that are similar as to the kind and level of
work.” In some instances, only one position may be involved, simply because no
other similar position exists. For example, in the small firm the position of
personnel manager also constitutes a job since there is only one personnel

manager position in the organization. Further, there may be six employees, “all of
whom are classified under the same title, yet each may perform slightly different
work.” For example, there may be five or six cashiers in a large commercial balk
branch who may do different work.
Occupation: An occupation “is a group of jobs that are similar as to the kind of
work land are found throughout an industry or the entire country.” An
occupation is la category of work found in many firms.
¶ Job Analysis: The U.S. Department of Labour defined job analysis as “the
process of determining, by observation and study and reporting pertinent
information relating to the nature of a specific job. It is the determination of the
tasks which comprise the job and of the skills, knowledge, abilities and
responsibilities required of the worker of a successful performance and which
differentiate one job from all others.”
The aspects of job analysis include job description and job
specification.
¶ Job Description: A job description is “an organized, factual statement of the
duties and responsibilities of a specific job.” In brief, it should tell what is to be
done, how it is done and why? It is a standard of function, in that it defines the
appropriate and authorized content of a job.
¶ Job Specification: A job specification is “a statement of the minimum
acceptable human qualities necessary to perform a job properly.” In contrast to
the job description, it is a standard of personnel and designates the qualities
required for acceptable performance.
¶ Job Classification: A job classification is “a grouping of jobs on some specified
basis such as the kind of work or pay.” For example, a clerk, a teacher, an
engineer, a chemist etc.
Process of job Analysis
Job can be analysed through a process, which consists of seven basic steps. These steps
consist of strategies, a collection of background information, selection of background
information, selection of job to be analysed, collection of job analysis data, developing a
job description, job specification and employee specification.
¯ Strategies: The strategies of the company are the basis for any organizational
activity including job analysis. If the strategy implementation needs innovative
skills and autonomy, they should be included in the job analysis.

According to William P. Anthony the companies have to make four strategic
choices viz.
ü The extent of employee involvement in job analysis
ü The level of details of job analysis
ü Timing and frequency of analysis and
ü Past-oriented vs. future-oriented job analysis.
¯ Collection of Background Information: Background information consists
of organization charts class specifications and existing job descriptions.
Organization charts show the relation of the job with other jobs in the overall
organizations. Class-specifications describe the general requirements of the class
of job to which this particular job belongs. The existing job description provides
a good starting point for job analysis.
¯ Selection of Representative Position to be analysed: It would be too
difficult and too time consuming to analyse all the jobs. So, the job analyst has to
select some of the representative positions in order to analyse them.
iv. Collection of job Analysis Data: This step involves actually analyzing a job by
collecting data on features of the job, required employee behaviour and human
requirements.
¯ Developing a job Description: This step involves describing the contents of
the job in terms of functions, duties, responsibilities, operations etc. The
incumbent of the job is expected to discharge the duties and responsibilities and
perform the functions and operations listed in job description.
¯ Developing a job Specification: This step involves conversion of the job
description statements into a job specification. Job specification or job
requirements describe the personal qualities, traits, skills, knowledge and
background necessary for getting the job done.
¯ Developing Employee Specification: This final step involves conversion of
specifications of human qualities under job specification into an employee
specification. Employee specification describes physical qualification,
educational qualifications, experience etc., which specify that the candidate with
these qualities possesses the minimum human qualities listed in the job
specification.
Job Description:
Job description is an important document which is basically descriptive in nature and
contains a statement of job analysis. It serves to identify a job for consideration by other

job analysts. It tells us what should be done, why it should be done, and where it should
be performed.
Characteristics of Good job Description: Earnest Dale developed the following
hints for writing the job description:
µ The job description should indicate the scope and nature of the work including all
important relationships.
µ (ii) The job description should be clear regarding the work of the position, duties
etc.
µ (iii) More specific words should be selected to show
ü (a) the kind of work,
ü (b) the degree of complexity,
ü (c) the degree of skill required,
ü (d) the extent t which problems are standardized,
ü (e) the extent of worker’s responsibility for each phase of the work and
ü (f) the degree and type of accountability.
Action words such as analyse, gather, plan, confirm deliver, maintain, supervise and
recommend should be used.
µ (iv) Supervisory responsibility should be shown to the incumbents.
Brief and accurate statements should be used in order to accomplish the purpose.
µ (v) Utility of the description in meeting the basic requirements should be checked
from the extent of understanding the job by reading the job description by a new
employee
The Content of Job Description
The job description normally contains the information on the following lines:
¯ Job title
¯ Organizational location of the job
¯ Supervision given and received
¯ Materials, tools, machinery and equipment worked with
¯ Designation of the immediate superiors and subordinates
¯ Salary levels: Pay , D.A., other allowances, bonus, incentive wage, method of
payment, hours of work, shift and break
¯ Complete list of duties to e performed separated according to daily, weekly,
monthly and casual, estimated time to be spent on each duty
¯ Definition of unusual terms
¯ Conditions of work: location, time, speed of work, accuracy, health hazards
and accident hazards
¯ Training and development facilities and
¯ Promotional chances and channels.
JOB SPECIFICATION

It is a written statement of qualifications, traits, physical and mental characteristics that
an individual must possess to perform the job duties and discharge responsibilities
effectively.
Job Specification Information:
The first step in the programme of job specification is to prepare a list of all the jobs in
the company and where they are located. The second step is to secure and write up the
information about each of the jobs in a company. Usually, this information includes:
ÿ i. physical specifications,
ÿ ii. mental specifications,
ÿ iii. emotional and social specifications and
ÿ iv. behavioural specifications.
¶ Physical specifications: Physical specifications include the physical
qualifications or physical capacities which vary from job to job. Physical
qualifications or capacities include physical features like height, weight, chest,
vision, hearing, ability to lift weight, ability to carry weight, health, age, capacity
to use or operate machines, tools equipment etc.
¶ ii. Mental specifications: Mental specifications include ability to perform,
arithmetical calculations to interpret data, information blueprints, to read
electrical circuits, ability to plan, reading abilities, scientific abilities, judgment,
ability to concentrate, ability to handle variable factors, general intelligence,
memory etc.
¶ iii. Emotional and social specifications: Emotional and social specifications
are more important for the post of managers, supervisors, foremen etc. These
include emotional stability, flexibility, social adaptability in human relationship,
personal appearance including dress, posture, poise, features and voice required
by the job.
¶ iv. Behavioural specifications: Behavioural specifications play an important
role in selecting the candidates for higher level jobs in the organizational
hierarchy. This specification seeks to describe the acts of managers rather than
the traits that cause the acts. These specifications include judgments, research,
creativity, teaching ability, maturity (capable of accepting responsibility) trial of
conciliation, self-reliance (self-starter sticks to own decisions), dominance (giving
orders in a personal way) etc.
Meaning & Objectives of HR Planning:

In simple terms, human resource planning means deciding the number and type of the
human resources required for each job, unit and the total company for a particular
future date in order to carry our organizational activities. E.W. Vetter viewed human
resources planning as “a process by which an organization should move from its current
manpower position to its desired manpower position. Through planning management,
strive to have the right number and right kind of people at the right place at the right
time, doing things which result in both the organization and the individual receiving
maximum long-run benefit.”
Objectives of Human Resources Planning: The important objectives of manpower
planning in an organization are
Ø (i)to recruit and retain the human resources of required quantity and quality.
Ø (ii) to foresee the employee turnover and make the arrangements for minimizing
turnover and filling up of consequent vacancies.
Ø (iii) to meet the needs of the programmes of expansion, diversification etc.:
Ø (iv) to foresee the impact of technology on work, existing employees and future
human resource requirements.
Ø (v) to improve the standards, skill, knowledge, ability, discipline etc.
Ø (vi) to assess the surplus of shortage of human resources and take measures
accordingly;
Ø (vii) to maintain congenial industrial relations by maintaining optimum level and
structure of human resources;
Ø (viii) to minimize imbalances caused due to non-availability of human resources
of the right kind, right number in right time and right place;
Ø (ix) to make the best use of its human resources and
Ø (x) to estimate the cost of human resources.
Benefits of HR Planning:
¶ Human Resources Planning (HRP) anticipates not only the required kind and
number of employees but also determines the action plan for all the functions of
personnel management. The major benefits of human resources planning are:
¶ It checks the corporate plan of the organization.
¶ It offsets uncertainty and change. But the HRP offsets uncertainties and changes
to the maximum extent possible and enables the organization to have right men
at the right time and in the right place.
¶ It provides scope for advancement and development of employees training,
development etc.
Factors Affecting HR Planning:

Several factors affect HRP. These factors can be classified into external factors and
internal factors.
External Factors: External Factors include:
Ø (i) Government Policies: Policies of the government like labour policy, industrial
relations policy, policy towards reserving certain jobs for different communities
and sons-of the-soil etc.,
Ø (ii) Level of Economic Development: Level of economic development determines
the level of HRD in the country and thereby the supply of human resources in
the future in the country.
Ø (iii) Business Environment: External business environmental factors influence
the volume and mix of production and thereby the future demand for human
resources.
Ø (iv) Information Technology: Information technology bought amazing shifts in
the way how do businesses operate? These shifts include business process
reengineering, enterprise resources planning and supply drain management.
Ø (v) Level of Technology: Level of technology determines the kind of human
resources required.
Ø (vi) International Factors: International factors like the demand for and supply
of human resources in various countries.
Internal Factors : Internal Factors affecting HRP include:
ü (i) Company strategies: Company’s polices and strategies relating to expansion,
diversification, alliances etc. determine the human resources demand in terms of
quality and quality.
ü (ii) Human resources policies: Human resources policies of the company
regarding quality of human resources, compensation level, quality of work life
etc. influence human resources plan.
ü (iii) Job Analysis: Fundamentally, human resources plan is based on job analysis,
job description and job specification. Thus, the job analysis determines the kind
of employees required.
ü (iv) Time horizons: Companies with a stable competitive environment can plan
for the long run, whereas firms with and unstable competitive environment can
plan for only short-term range. Exhibit 4.2 presents the degree of uncertainty and
length of the planning period.
ü (v) Type and quality of information: Any planning process needs qualitative and
accurate information. This is more s with human resources plan. Exhibit 4.3
presents HRP information.

ü (vi) Company’s production/operations policy: Company’s policy regarding how
much to produce and how much to buy from outside to prepare a final product
influences the number and kind of people required.
ü (vii) Trade unions: Influence of trade unions regarding the number of working
hours per week, recruitment sources etc., and affect HRP.
The Human Resource Information System (HRIS)
The Human Resource Information System (HRIS) is a software or online solution for
the data entry, data tracking, and data information needs of the Human Resources,
payroll, management, and accounting functions within a business. Normally packaged
as a data base, hundreds of companies sell some form of HRIS and every HRIS has
different capabilities. Pick your HRIS carefully based on the capabilities you need in
your company.
The Human Resource Information Systems (HRIS) provide:
þ Management of all employee information.
þ Reporting and analysis of employee information.
þ Company-related documents such as employee handbooks, emergency
evacuation procedures, and safety guidelines.
þ Benefits administration including enrollment, status changes, and personal
information updating.
þ Complete integration with payroll and other company financial software and
accounting systems.
þ Applicant and resume management.
The HRIS that most effectively serves companies tracks:
þ attendance,
þ pay raises and history,
þ pay grades and positions held,
þ performance development plans,
þ training received,
þ disciplinary action received,
þ personal employee information, and occasionally,
þ management and key employee succession plans,
þ high potential employee identification, and
þ applicant tracking, interviewing, and selection.
An effective HRIS provides information on just about anything the company needs to
track and analyze about employees, former employees, and applicants. Your company
will need to select a Human Resources Information System and customize it to meet
your needs. With an appropriate HRIS, Human Resources staff enables employees to do

their own benefits updates and address changes, thus freeing HR staff for more strategic
functions. Additionally, data necessary for employee management, knowledge
development, career growth and development, and equal treatment is facilitated.
Finally, managers can access the information they need to legally, ethically, and
effectively support the success of their reporting employees.
Strategic HR Planning:
Strategic HR planning is an important component of strategic HR management. It links
HR management directly to the strategic plan of your organization. Most mid- to large
sized organizations have a strategic plan that guides it in successfully meeting its
mission. Organizations routinely complete financial plans to ensure they achieve
organizational goals and while workforce plans are not as common, they are just as
important.
Strategic HR management is defined as: Integrating human resource management
strategies and systems to achieve the overall mission, strategies, and success of the firm
while meeting the needs of employees and other stakeholders.
The overall purpose of strategic HR planning is to:
ü Ensure adequate human resources to meet the strategic goals and operational
plans of your organization
ü the right people with the right skills at the right time
Keep up with social, economic, legislative and technological trends that impact
on human resources in your area and in the sector
Remain flexible so that your organization can manage change if the future is
different than anticipated.
ü Strategic HR planning predicts the future HR management needs of the
organization after analyzing the organization’s current human resources, the
external labour market and the future HR environment that the organization will
be operating in.
The strategic HR planning process: The strategic HR planning process has four
steps:
þ Assessing the current HR capacity
þ Forecasting HR requirements
þ Gap analysis
þ Developing HR strategies to support organizational strategies
þ Assessing current HR capacity
Based on the organization’s strategic plan, the first step in the strategic HR planning
process is to assess the current HR capacity of the organization. The knowledge, skills

and abilities of your current staff need to be identified. This can be done by developing a
skills inventory for each employee.
Forecasting HR requirements: The next step is to forecast HR needs for the future
based on the strategic goals of the organization. Realistic forecasting of human
resources involves estimating both demand and supply.
Gap analysis: The next step is to determine the gap between where your organization
wants to be in the future and where you are now. The gap analysis includes identifying
the number of staff and the skills and abilities required in the future in comparison to
the current situation
Developing HR strategies to support organizational strategies: There are five
HR strategies for meeting your organization’s needs in the future:
¯ Restructuring strategies
¯ Training and development strategies
¯ Recruitment strategies
¯ Outsourcing strategies
¯ Collaboration strategies
Restructuring strategies: This strategy includes:
ü Reducing staff either by termination or attrition
ü Regrouping tasks to create well designed jobs
ü Reorganizing work units to be more efficient
Training and development strategies: This strategy includes:
ü Providing staff with training to take on new roles
ü Providing current staff with development opportunities to prepare them for
future jobs in your organization
Recruitment strategies: This strategy includes:
ü Recruiting new staff with the skill and abilities that your organization will need in
the future
ü Considering all the available options for strategically promoting job openings and
encouraging suitable candidates to apply.
Outsourcing strategies: This strategy includes:

ü Using external individuals or organizations to complete some tasks
ü Many organizations look outside their own staff pool and contract for certain
skills.
ü This is particularly helpful for accomplishing specific, specialized tasks that don’t
require ongoing full-time work.
Collaboration strategies: Finally, the strategic HR planning process may lead to
indirect strategies that go beyond your organization. By collaborating with other
organizations you may have better success at dealing with a shortage of certain skills.

Human Resource Management Guide - Functions and Importance of HRM

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Human Resource Management Guide - Functions and Importance of HRM