2. HUMAN RESOURCES - MEANING
• Resources : the means available to achieve an
end
MEANS END
Money to live a comfortable life
Plot of land to provide shelter
Sophisticated machinery To increase productivity
4. ORGANIZATION AS A SYSTEM
INPUT
THROUGHPUT
OUTPUT
CONVERSION
PROCESS
ENVIRONMENT
ENVIRONMENT
5. CAPITAL flows freely across borders (VC’s /
Banks)
TECHNOLOGY is available to CEO’s who cannot
grow it – for the right price
RAW MATERIAL is free to be transported across
the globe
INFORMATION is available to anyone ( Internet)
IMPORTANT DISTINCTION – PEOPLE / EMPLOYEES
OF THE ORGANIZATION
The only thing that distinguishes ‘ Pepsi’ from
‘Coca Cola ‘ is the quality of its people
6. PRODUCTS = PEOPLE
Breakthrough products can be created only
through planned human efforts – scanning ideas
– such as laboratory research
Nokia models, i-pod , Robots
MANUFACTURING = PEOPLE
SONY – Technology X – Cleverer use of Technology –
People
TOSHIBHA – Technology X – not as successful
--------------------------------------------------------------
MARUTI SUZUKI – Technology Y – Cleverer use of
Technology – People
FIAT – Technology Y –not as successful
7. MARKETING = PEOPLE
Customer Satisfaction
Service quality
convert wandering experimenters to loyalists
People are being the principle instrument to
delight the customer
8. CORE COMPETENCIES = PEOPLE
Fundamental strength of the corporation –
unique expertise – skills and abilities of its people
• Tata Steel – Steel
• ACC – Cement
• ITC – Hotels and Cigarettes
• Gillette – Shaving Products
Conceptual , Technical and Behavioral
9. SUPERIOR PRODUCTS + SUPERIOR
MANUFACTURING + SUPERIOR MARKETING +
SUPERIOR CORE COMPETENCIES =
COMPETITIVE EDGE
COMPETITIVE EDGE = PEOPLE
So , if you manage your people well – you
manage your products , manufacturing ,
marketing , core competence well and gain
competitive edge
10. • Adi Godrej , CEO , Godrej Soaps
All corporate strengths are dependent on and
centered around – Human Resources
• B.K. Modi , Chairman , Modi Group
How you manage your people is critical for
survival and growth
Ordinary
People
HRM( to get
the best out
of people)
Extraordinary
Results
11. HRM (DEFINED)
The art of procuring , maintaining ,
motivating ,developing and retaining
a competent workforce to achieve
the goals of an organization in an
effective and efficient manner
12. PROCURING
to procure vegetables from the subzi-bazaar
to obtain
to procure human resources from the
employment market – recruitment and
selection (RR – Attitude)
13. MAINTAINANCE
causing to continue – by protecting and
preserving the physical , psychological and
social well being of the employee through :
• Health and Safety measures – protecting from
unhealthy conditions and physical hazards
• Employee Welfare – Housing , transportation ,
education and recreation facilities
14. MOTIVATING
30-90 % performance
Financial and Non –Financial Rewards
Incentives
DEVELOPING
T & D
On sophisticated machines , on interpersonal relations
, on quality management , on creativity management ,
on decision-making etc.
Trained workers can work more efficiently
Cost – cutting
superior performance
helps managers acquire KSA’s to meet with complex
changes in business environment and technology
15. RETAINING
80 - 20
Star performers
Talent Management
Fast-track career paths
right placements
challenging work
recognition
avenues for growth and development
succession planning
ESOP’s
20. RECCOMMENDED TEXT BOOKS
Human Resource Management – Text and Cases –
V S P Rao – 3rd Edition – Excel Books
Text & Cases in Human Resources Management -
K. Ashwathappa – Tata McGraw Hill
Human Resource Management - Flippo
21. SCOPE OF HRM
HR ACCQUISITION
HR Planning ( over staffed)
Job Analysis
Recruitment(Convey.-part of sal.)
Selection( Ka-Sym)
Orientation
Placement
HR DEVELOPMENT
Career Planning ( Big fish – small pond)
Training & Development(sensiti)
Organization Development
Counselling
PERFORMANCE AND
COMPENSATION
Performance Appraisal ( incr. less-GM)
Compensation Mgmt. ( wage bill)
Incentives & Perquisites
MOTIVATION AND
MAINTAINANCE
Creating motivating environment
Empowerment and participation
Safety & Health
Retention
22. SCOPE OF HRM CONTD.
SUPPORTING FUNCTIONS
HRIS ( at a button)
HR Accounting ( Cost – Economic value ; Balance sheet Costs – Assets )
HR Audit ( Recruit – vacancy filing , T & D – Trg. Mandays , Absenteeism, Grievance
% - Depts. )
Time Office and Pay Roll
INDUSTRIAL RELATIONS
Industrial Disputes - Industrial Harmony (DKS –rose)
Union Negotiations ( Rule of Two)
Discipline / Grievance
Labor Welfare
Labour Laws
INTERNATIONAL HRM
25. PRIMARY OBJECTIVE : To ensure the availability
of a competent and willing workforce to an
organization (skill and will)
ORGANIZATIONAL OBJECTIVES : Assist the
organization – to meet its objectives and make
the organization more effective ( HRM strategy –
Org. strategy – same direction)
FUNCTIONAL OBJECTIVES : To maintain the HRM
Department’s contribution at a level appropriate
to the organizations needs ( staff function)
26. SOCIETAL OBJECTIVES : To be Ethically
(Satyam) and Socially ( sons of the soil)
responsible – to the needs of society
PERSONAL OBJECTIVES : Personal goals of
employees must be met by alignment of
organization objectives and personal
objectives - needs , wants , desires ( money ,
status , achievement , affiliation )
27. HRM – FUNCTIONS
( A mode of activity by which a thing fulfills its purpose)
MANAGERIAL
FUNCTIONS OPERATIVE
FUNCTIONS
28. Managerial Functions – Planning ,
Organizing , Directing and Controlling
PLANNING – Determination of the future
course of action to achieve desired results
Planning of personnel today prevents a crisis
tomorrow
HRP
Potential Appraisal ( Succession Planning)
Training & Development - TNA
Strategic HRM
29. ORGANIZING – Assigning of different groups
of activities to different individuals and
delegation of authority
HRD Manager , 4 HR Executives , 2 HR
Assistants
He / She will do this
Reporting relationships
DIRECTING – Guiding , Supervising –
motivation and leadership - The HR Manager
must be an effective leader who can create
winning teams
30. CONTROLLING – Set standards , measure , compare ,
corrective action
performance appraisal (MBO) , T & D , HRP , personnel
audit
OPERATIVE FUNCTIONS ( specific activities of HRM –
to be performed alongwith managerial functions)
Staffing and Employment
Job Analysis – Job Description + Job Specification
HRP
Recruitment
Selection
Placement
Promotion
Transfer
(RR- Hire for Attitude)
31. Training & Development
on – the – job methods
off - the – job methods – MDP ‘s
to develop skills for current and higher jobs
Performance Appraisal
Compensation
determination of adequate and equitable remuneration of
the employees
Includes:
Job evaluation to determine worth of various jobs in terms
of money
comparing the wages of the enterprise with those in
industry and remove inconsistencies
32. formulation of policies regarding incentives ,
profit-sharing plans , social security , ESOP’s , club
membership and paid holidays/ overseas
vacations
Integration
reconciliation of the interests of personnel with
those of organization
communication – upward , downward , lateral
two-way traffic of personnel policies and
objectives
Healthy Collective Bargaining
Prompt Grievance redressal
Employee participation and empowerment
33. Working Environment
good working conditions
safe working conditions
drinking water facilities
hygienic environment
good lighting and ventilation
Welfare Activities and Benefits
physical , psychological and social well being
Transportation
medical facilities
first-aid box
crèche
recreation facilities – TT , Chess , Carrom
Education of children
canteen
Housing facilities
Benefits as per Labor Laws
34. Human Relations
good employer – employee relationship ( 28th
salary)
healthy collective bargaining ( Mukund Iron and Steel)
proper implementation of labor enactments
industrial peace and harmony
Long service awards
Achievement Awards
(Russi Modi – 10,000 employees)
35. HR Records and Statistics
Personal Files
Performance appraisal records
reveal human resource talent available for
positions – skills inventory , management
inventory
identifying weaknesses (PA) – identifying
training needs
Personnel Research - Chronic absenteeism –
labor turnover , alcoholism
HRIS
36. Separation
full and final settlement of dues
provident fund
gratuity
VRS / Retrenchment / Dismissal
Exit Interview
( Notice Period – 7th – 11th)
38. EVOLUTION OF HRM
ADAM SMITH
Economist
Published ‘ The Wealth of Nations ‘ in 1776 – talked
about – division of labour ( work specialization)
Used the pin manufacturing industry , for example –
10 individuals – each doing a specialized task –
produce many more pins – than – each working
separately and independently
39. Industrial Revolution
1760 : Industrial Revolution – Great Britain- then
spread to other countries
1830 :France ,Belgium , USA
1850 : Sweden and Japan
1870 -80 : Canada , USSR ,Japan , India
40. • During 1800’s - Factory system – modern
management techniques
• New inventions revolutionalised commerce and
industry
• Led to mass scale production and division of
labour
EARLY CONTRIBUTORS TO DEVELOPMENT OF
PERSONNEL MANAGEMENT
Robert Owen : Industrialist , Father of PM
Advocated – spirit of cooperation between the
workers and management – treated as human
beings
41. He made provisions for :
reduced working hours
housing facilities
education of workers and their children
FREDERICK WINSLOW TAYLOR
Father of Scientific Management – concept of fair day’s
work , time and motion studies and piece rate
system (DP)
HENRI FAYOL
14 principles of management
42. ELTON MAYO
Father of human relations movement – Hawthorne
Experiments
Other contributors included – Renesis Likert , Maslow ,
Victor Vroom and Mc Gregor
These studies – shaped the gradual development – of
the theory and practice – of Personnel Management
World Wars – Armies – selection , placement ,
psychological testing , training and post-Army vocational
guidance
43. GROWTH OF PERSONNEL MANAGEMENT IN
INDIA
PM Development – UK , USA – largely voluntary
India – emerged – governmental intervention and
compulsions
Early 1900’S -Calico Mills , Ahmedabad - opened –
Creche – with doctor and nurse
1918 – Tata’s – appointed medical officer for workers
Beginning – 20th century – various malpractices –
recruitment of workers and payment of wages –
industrial disputes – colossal loss in production
Jobbers
44. 1931 – Royal Commission on Labour – Chairmanship
of J.H. Whitely – recommended – abolition of ‘
‘jobber’ system – appointment of labor officers –
performing hire & fire and welfare of employees.
LWO – hiring / firing / wage administration
Mill Owners Association , Bombay – appointed first
labor officer
1937 – TISCO, Jamshedpur – appointed labor officer
1947 onwards : Factories Act , ID Act , Payment of
Bonus Act , PF Act
45. 1975 – First company to introduce HRD –
L & T
1980 – BHEL
1990 – LPG Era – New challenges for HR –
Globalization , Diversity , Corporate
Governance , multi-skilling , Job Design
47. Personnel Mgmt. Vs Human Resource Mgmt.
DIMENSION PERSONNEL
MANAGEMENT
HUMAN RESOURCE
MANAGEMENT
Employment
Contract
Careful delineation
of written contracts
Aim to go beyond
contract – OCB
( Integration)
Rules Importance of rules Importance of
results
Managerial task vis-
à-vis labor
Monitoring Nurturing
Key Relations Labor Business driven
Speed of decision Slow Fast
Communication Indirect Direct
48. DIMENSION PERSONNEL
MANAGEMENT
HUMAN RESOURCE
MANAGEMENT
Prized Management skill Negotiation Facilitation
Appraisal Seniority Merit
Labor Management Collective bargaining Individual contracts
Conflict handling Reactive Proactive
Respect for employees Labour – expendable
and replaceable
People as assets
Shared Interests Interest of organization
uppermost
Mutuality of interests
Evolution Precedes HRM Latest in evolution of
subject
50. TEAMS
Many of the tasks that Organizations carry
out today – are simply too large , complex and
multi-faceted - to assign to- a single individual
working alone
They require collaborative effort
The Surgeon – cannot begin a complicated
heart operation – without the help of an
anaesthesist
51. a surgical assistant – to hand over the correct
apparatus at the appropriate time – a
recovery nurse to monitor the patient after
the surgery
Such a demanding and complicated task
requires a team of people – with different
skills – to work cooperatively together –
relying on one another – towards the
achievement of an overall shared goal
52. Quite simply- members of a team Need each
other
Similarly an Airline Pilot , a professional
cricketer or a frontline soldier in combat
HUL gives project to Wipro – one software
engineer from C++ , Java , Unix , Web based
services , Accounts and Administration
shared goal-completion of project within
deadline - and interdependent
53. The Boeing Company – cross functional team –
from – production , planning , quality , tooling ,
design engineering and information systems for
the company’s to be launched Boeing Aircraft
Highest level - Self Managed Teams – can not
only solve problems – but implement solutions –
and take responsibility for outcomes
Select their own members and have members
evaluate each others performance
Empowerment - High , Motivation- High
Extreme Y Theory
56. HR Manager – balance the demands and
expectations of the external forces – with the
internal requirements – and achieve the assigned
goals – in an efficient and effective manner
Likewise – the internal environment – peculiar to an
organization – effects – the job an HR Manager
Given - External and Internal Dynamics – HR
Manager – the way the HR function is carried out –
to ensure survival and progress
59. GLOBALIZATION
People , goods , capital , information – moving
around the globe
World – borderless market
Sales outside home market ; Coca Cola – 80 % ,
Nestle – 50 % , P & G – 65 %
Businesses can hire , source and sell – wherever they
want now
price and quality global - competitive
60. HR’S ROLE IN GLOBALIZATION
Global Corporations – raise money in one market –
buy raw materials in other markets – manufacture ,
different location – products sold all over the globe –
more functions – effect on organization structure –
divisions – departments
More heterogeneous functions – country specific
More involvement in employee’s personal life – WLB
– culture shock
More cultural differences – languages – foods-
values – beliefs
Different approaches to management
61. Global corporations – require employees with
transferable skills – who can adapt to different
cultures – customs – habits - management styles
Retaining top talent – cultures and reward systems –
challenging work – recognition
Competitive – empowerment – cost cutting –
connect people to their passions ( worker – mechanics
workshop home – product design to quality control )
Ex- patriate Manager
Cross Cultural training
62. MERGERS AND ACQUISITIONS
Purposes
to incorporate new technologies
to enter new markets and gain market share
to improve their market standing and stay at the top
2008 – Indian Companies - 1270 M &A deals
Tata Steel - Corus
63. HR’S ROLE IN M & A
Buying a company – not just – land and buildings –
equipment – and other physical assets – also investing –
in talent acquisition – intellectual capital ; knowledge ,
skills and abilities
Without ‘People’ Side – Successful integration – not
possible
Employee concerns – job security – compensation
structure-reward structure – growth avenues – cultural
issues – mount up
HR- allay the concerns of employees – lay offs –
compensation practices – job profiles – reporting
relationships
64. Need to create a dedicated and skilled leader and
team for overseeing M & A activities
Need to understand the cultures of both companies
Merged entity – culture shock
HR- align – right people with the appropriate KSA’s –
to meet the shared objectives of the enterprises
HR – advise top management – organization
structure – policies – compensation structure
Two-way Communication
66. DOWNSIZING
Rising costs , business survival , recessionary
conditions , fat wage bills , organization re-
structuring
ROLE OF HR IN DOWNSIZING
Some employees are faced with job loss
Survivors – grapple with uncertainty
Many talented employees-quit in a hurry
Aftermath-downsizing-wounded workforce- stressed
and demotivated
67. HR – play a key leadership role – before – during and
after the downsizing – aimed at bring everything
back to normalcy
Firstly – Employee involvement – All levels of
organizations into confidence – cost saving ideas –
flexible work schedules – rewards and benefits could
be re worked – what can be outsourced at cheaper
costs – consultative approach
Secondly – Communication – two way – reasons for
downsizing – how it benefits the organization – what
would happen to those – asked to leave
Thirdly - while identifying ‘at risk’ employees – moral
and ethical values – no biases
68. Fourthly , Outplacement programs
Fifthly – Counseling
Sixthly – T &D – for survivors – to adjust to
the new challenges – brought in by ‘new look’
organization
69. TECHNOLOGICAL CHANGE & HR
Advent of technology – jobs upgraded – human
resources (workers) change – from illiterate / unskilled
worker to educated / skilled worker
Introduction of new technology – dislocated some
workers – rehabilitation
Knowledge workers – increased wages ,incentives and
quality consciousness
Techno-structure
Training & Development –
upgrade existing employee skills and knowledge
Service sector – strong interpersonal and communication
skills
70. Downsizing - lower end jobs
Work demands as a consequence of Technological
changes –
Telecommuting
Relocation of work from office to employees home
Telecommuting – working from home – usually with
computers , Internet and phones – Accenture , IBM
Intel , Wipro
Telecommuting zones in offices – work stations –
only for telecommuters – who come in on certain
days
71. Flexible Work Arrangements
Flexible work schedules – shorter workweeks – 3
twelve – hour days or 4 nine – hour days
Flextime – employee- chooses daily starting and
quitting time – provided that – they work a certain
number of hours per day or week
Job Sharing – two part time employees – perform a
job – that otherwise would be held – by one full time
employee ( also – working couples with young
children , elder employees)
Internet revolution - Managing Virtual Corporations
72. ORGANIZATION CULTURE
Values , Attitudes and Beliefs – common
US – India – Saudi Arabia
Similarly :
Infosys – Wipro
Tata – Reliance
Walt Disney – fun at work
General Motors – Hero Group
73. ORGANIZATIONAL CULTURE CONTD.
Grooming managers from within vs External
Recruitment
Seniority vs. Merit
Generalist or Specialist
Clothes – Formals or Informals
Communication – Formal channels vs. informal
channels
74. TOTAL QUALITY MANAGEMENT - TQM
Quality has become – the most important word – in
the corporate dictionary
Product Quality and Service Quality
Doing things right the first time – every time
Continuous improvement of – skills – teamwork –
processes – product and service quality – customer
satisfaction
75. ROLE OF HR IN TQM
Quality persons give Quality products and services
TQM allows employees to exploit their - best in them -
full potential
Employee Involvement ( Commitment)
Organization Culture ( Quality consciousness)
Theory Y assumptions , motivation , access to
information , advanced tools and techniques –
empowered to give quality products and services
Team Building (synergy - interdependency , - including
QC – self managed teams)
Training & Development
76. REENGINEERING
TQM – continuous incremental change
Where an organization requires a drastic , quantum change –
in order to survive – in a fiercely competitive market
Reengineering – radical , quantum change in an organization
radically transformed business processes
Fundamentally – better way of doing things
Insurance Corporation
Technology driven companies – more scope
series of processes – strategic planning to after-sales
customer support – decide to what extent each adds value -
better and more cost effective way of doing things
TELCO , L & T , Ranbaxy , Crompton Greaves – brought about
radical changes through reengineering
77. • Cotton Cleaning – Weaving – Spinning – Dyeing – Printing
– Quality Control
• A process is a series of steps or tasks aimed at
accomplishing a defined business o b j e c t i ve.
There are :
o manufacturing processes
o accounting processes
o credit approval processes
o material receiving processes
o inspection processes
o product design processes, and so on. A business can
have hundreds of processes and most processes can be
bro ken into smaller and processes .
FOCUS ON HOW WORK IS DONE -Maximum customer
value at least cost
78. Traditionally we have done it this way - Remove the
non-value adding processes
( computerization)
For example, radical and fundamentally new BPR
ways enabled Motorola to slash order fulfilment for
paging devices from 30 days or more to 28 minutes
and progressive insurance to slash the claims
settlement from 31 days to 4 hours.
79. A Chinese manufacturer that sells to the US has come
up with a novel way of saving costs. When the ship sets
off from Shanghai, it has onboard only a few of the raw
materials that go into the final product. Instead of the
route traditionally taken by North America bound
vessels, it stops at ports depending on where it needs
to pick up the next set of components from, till it
finally reaches North America. The raw materials are
converted into appliances onboard this 'floating
factory'. Not only does this mean savings on factory
costs, but the company is also making optimal use of
the travel time, normally the most unproductive part
of the whole distribution process.
80. HR’S ROLE IN REENGINNERING
PROCESS
Employee involvement – to build commitment to
reengineering
Can hire people – who can work in process-oriented
teams – sharing their skills and expertise freely –
creativity and innovation
Open Communication – brainstorming -
transparency – trust
Training & Development – to improve their
technological skills - team related skills
81. OUTSOURCING AND HRO
Outsourcing – is obtaining work previously done by
employees inside the company – from sources
outside the company
Focus on core activity- outsource to cost effective
specialized agencies
excellent quality – reliable supply – low price
Dell outsources – manufacture of its computers –
concentrates on web-based direct sales activity
Nike and Reebok – focus on core strength – in design
and marketing – and outsource all footwear
manufacturing
82. Off shoring – refers to the movement of jobs overseas
Almost any job – white collar or blue collar – can be
performed in –India , China , Philippines , Brazil – for a
fraction of US wages
HUMAN RESOURCE OUTSOURCING (HRO)
HRO is a process – in which a company utilizes – the
services of a third party – to take care of its HR function
A company may outsource – a few or all its HR functions
– service providers
Pay roll - health benefits – recruitment – record keeping
– training & development
Substantial savings in cost and effort
Unilever – HR functions to Accenture
84. CHANGING TRENDS IN WORKFORCE
DIVERSITY
When employees differ from each other in terms of age
– gender – education – religious affiliation – disability
status – nationality
Challenge – talented employees with different
backgrounds and expectations – and to mould them –
into a focused and dedicated workforce
Composition of workforce
Accommodates three different generations
The Baby Boomers ( born between 1946 – 1964)
Generation X ( born between 1965 – 1979)
Generation Y ( born after 1980)
85. Dealing with ageing workforce
On Exit-
Culture change
Knowledge gap- deep relationships gap – extensive
training gap
Leadership gap – senior levels
Overcome problem :
Retention planning – key employees
Succession planning
Targeted selection – important attributes – captured
in selection system
Culture change
86. Entry of Educated women at work
women employees today – constitute a major share
of the workforce
Software Industry in India – nearly 35 % are women
Accounting , hospitality , banking , insurance ,
airways , police , and even driving
Amrita Patel – Chairman NDDB , Indira Nooyi –
Chairman Pepsi , Chanda Kochar – Joint MD ICICI
Bank , Indu Jain – Chairman Times Group and Kiran
Mazumdar Shaw – Chairman and MD Biocon
87. Temporary workers - Temps
Temporary basis generally on short-term projects – also
known as Temping
Temporary employee – who works with a client company
– but is on the pay roll of a third party staffing agency
Temping – India – after early 1990’s – constantly
churning markets – avoid extra welfare costs payable to
permanent workers
Companies – when bombarded with extra work – , to
meet additional demand for refrigerators or AC’s during
summer – temps – after season over-discontinue
88. When the company – does not have employees –
with specific domain (area) expertise – tap temping
agencies – high standards of quality and save costs –
when the work ceases to exist
If qualified temps are found useful for the
organization – in the long term – one can offer them
a permanent job
DIVERSITY MANAGEMENT STRATEGIES
Open Communication and encouraging feedback –
learn about a group’s personal value – and
understand how individuals like to be treated –
disabled – senior citizens
89. Awareness building – Companies – developing
awareness campaigns – to help employees –
understand the pain of harassment and indignity –
the way assumptions affect their behaviors ,
decisions and judgment
Diversity training and skill building – skills required
to manage a multicultural – diversified workforce –
also imparting interpersonal skills – listening and
giving feedback
Organizational practices – Flexible work schedules –
accommodating various religious festivals – benefit
packages with insurance for bigger families – leaves
for hometown visits – once a year – paternity leaves
91. WORK LIFE BALANCE (WLB)
Life in the 21st century – intense competitive
environment – the invasion of information
technology ( time zones) – work alcoholics - the race
to be first and best performance culture
Sacrificing – family , kids , relationships , friends ,
community , energy
Weekend parents
Never time for relaxation – visit parks and museums
Heart ailments – sleep disorders – depression –
irritability – insecurity – and even nervous
breakdowns
excessive smoking – drinking – gambling
92. Companies – deal with –
Different clubs – Theatre Club – Adventure and
Trekking club – Fitness club – Music club and
community services club
These clubs organize – yoga – dance lessons – music
competitions – trekking expeditions – sports
activities-regular visits to NGO’s (TCS)
Flex time
paternal leave
women employees – sabbaticals (Infosys)
Begin the day with yoga , meditation and health
food breakfast (Hero Motors)
93. THE ECONOMIC ENVIRONMENT AND HR
Most global economies inter-connected
Tight economic conditions – recession - Downsizing
– lean and mean organization
VRS and Retrenchment – out placement – financial
and psychological counselling
Compensation competitive – less employees-best
employees
IR becomes market-driven rather than ideology
driven
94. THE SOCIAL ENVIRONMENT AND HR
Beliefs – values – customs – traditions - MNC- US ,
Australia , Bangladesh , Africa – different cultural
backgrounds – organization acquires distinct culture
Attitude of employees towards work – is a result of their
cultural background
Peoples orientation – Past , Present , Future – roots in
culture
Japanese – Futuristic – life time employment
Americans – Present – as long as useful to the orgnz. –
dispense once not – loyalty not that important
Saudi Arabians – Past – continuing as per traditions of
organization
95. Culture as a result of social forces – confines them to
specific occupations – Workers in Tea Plantations in
Assam
cannot work in Bengaluru / Delhi
Their food habits – dress sense – language is fit for
tea plantations of Assam
Similar is the case with – Workers in diamond
cutting units at Surat in Gujarat
97. ORGANIZATIONS STRATEGY AND ITS
EFFECT ON HR
Diversification
Expansion
Becoming a Global Corporation
Effect on :
Recruitment & Selection
Training & Development
Compensation
Culture
98. ORGANIZATIONAL CULTURE AND ITS
EFFECT ON HR
Grooming managers from within vs External
Recruitment
Seniority vs. Merit
Generalist or Specialist
Clothes – Formals or Informals
Communication – Formal channels vs. informal
channels
99. ORGANISATIONS FINANCIAL POSITION
Profitable Periods : larger bonuses – enhanced wage
and salaries – profit sharing – incentives –
perquisites
Financial difficulty : Downsizing – cut of training
budgets – recruitment freeze – freeze on increments
--------------
100. STRATEGIC HRM
originated from the Greek term ‘ Strategia’
Strategy : Art of being a general
Greek Generals needed to :
lead an Army
win
hold territory
destroy the enemy
Each objective needed a different deployment of
resources
Bangladesh war – food supply
101. Strategy
Planning Component
Action Component
Formulation of a goal and a set of action plans for
accomplishment of that goal
A Strategy is a comprehensive (detailed) and
integrated ( all plans are compatible) plan designed
to ensure that the basic objectives of the
organizations are achieved
102. STRATEGIC MANAGEMENT PROCESS
•ACTION COMP.
•POLICIES
• PROCEDURES
• BUDGETS
• STRATEGIC
CONTROL
PROCESS
• CORPORATE
• BUSINESSS
UNIT
FUNCTIONAL
• EXTERNAL
• INTERNAL
ENVIRONMENTAL
SCANNING
STRATEGY
FORMULATION
STRATEGY
IMPLEMENTATION
EVALUATION
AND
CONTROL
103. ENVIRONMENTAL SCANNING
Environment Scanning – determine trends and
projections – of factors that will effect fortunes of
the organization
SWOT Analysis
Helps identify threats and opportunities – prevailing
in the environment
In formulating strategy – organization :
• Advantage of the opportunities
• minimizing threats
104. What might be a threat to one company – may be an
opportunity for another
The oil crisis of 1970’s –
threatened oil-fired electrical utilities
provided great opportunity for coal producers and
shippers
105. STRATEGY FORMULATION
Strategies are formulated at 3 levels :
Corporate Level
Business Unit Level
Functional Level
Corporate Level Strategy
formulated by top management
more than one level of business
107. ENVIRONMENT SCANNING STRATEGY FORMULATION
Insurance sector will be opened up to
private sector
Diversify into Insurance
The demand for chemicals will no longer
be profitable
Hive off Tata Chemicals
Steel is a core competency with the Tata
Group
Acquire Cores and merge with Tata Steel
Tata Motors – surplus of funds ; Tata
Mutual Funds - deficit on cash flow
Pump cash flow from Tata Motors to Tata
Mutual Fund – according to regulations
108. BUSINESS UNIT LEVEL STRATEGY FORMULATION
- WESTSIDE ( RETAIL)
OBJECTIVE / GOAL : To be the market leader in Retail
Garments in India and record its presence overseas
STRATEGY
Increase market share from 22% to 45% over the next
two years
Shift focus to exports
Launch new products in wool and silk
Pricing strategy – focus on volumes rather than units
Increase production capacity from 1,00,000 units per
month to 2,50,000 units per month within the next 2
years
109. FUNCTION LEVEL STRATEGY ( MARKETING)
Focus on Europe , US , Middle East and Africa Export
markets
Increase retail distribution outlets from 250 to 400
outlets within the next two years
Launch Gymania , Sparta , Revelin and Cider products in
the market
Develop Distributor relations
Expand advertising to electronic media and the Internet
Top priority to CRM
(Linking of Corporate – Business Level – Functional)
110. STRATEGY IMPLEMENTATION
After strategy formulation – strategy implementation
For example :
opening new offices
adding new departments
closing facilities
hiring new employees
changing pricing strategies
implementing cost control procedures
Transfers
111. STRATEGY EVALUATION
Establishing performance targets for the strategies
Measuring the performance in relation to the
targets
Analyze deviations from acceptable tolerance limits
– inform managers to take action
Execute modifications where necessary
113. CASE STUDY – I ; HR STRATEGY FOR
ORGANIZATIONAL REVIVAL
1970’s – 1980’s
Textile Industry of Ahmedabad was becoming known
as a declining industry
Centuries old business – declining
Organization Goal – Turnaround to the Company’s
business
Corporate Strategy – Concentrate on the product
called ‘ Denim’ – which had high demand in the US
Market – Company – MNC in a given period of time –
with a high market share of ‘denim’ - Turnaround to
the Company’s business
114. HR Strategy – Get the right talents through external
sources – who can stay with the company – in its long
journey of expansion and growth
It hired a professionally qualified HR Manager –
Textile Engineer – IIT and PGDM – IIM – Ahmedabad
New entrants- were offered lucrative compensation
packages – which included high remuneration and
attractive benefits – like house loan – amounting to
Rs. 50 lakh at almost 0 % interest – repayable in 25
years
Age around 25 – 28 – having a house of their own –
in a prestigious residential city like Ahmedabad –
proved to be a boon
115. Once a young talent – joined the organization
– he could not think of opting out – so the
professionals continued in the job and gave
their best
The organization was – able to realize – its
goals – through high performance – higher
market share of denim in the market – and the
Company became an MNC with
expansion/growth plans
116. CASE STUDY - II
1980’s – 90’s
Corporate Strategy : Restructuring – around core
businesses – hiving out poor performing businesses
HR Strategy – Effective communication system – to ‘tell
and sell’ VRS
CASE STUDY – III
Corporate Strategy : Cost cutting to survive competition
HR Strategy – Downsizing
Outplacement – freezing recruitment – pay for
performance – reducing perquisites – re training
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