Human Resources Management :
Content
Human Resources Management :
Strategic planning means long term and short term planning of various activities begining from goal setting to achieve the goal and the resetting new goals. While adopting strategies, managers give maximum emphasis on optimum utilization of resources like finance, capital, raw material, but quite often they neglect or give less importance to human resource. The clear fact is that HR is the most significant asset of the enterprise because optimum utilization of other resources depends entirely on efficiency of the Human Resource. As said by a famous management consultant “For many yearsit has been said that capital is the bottleneck for a developing industry. It is no longer holds true because it is the workforce and the company’s inability to recruit and maintain a good workforce tht does constitute the bottomneck for production. I don’t know any major project in any field backed by good ideas, vigor and enthusiastic team has been stopped by the shortage of cash but there are innumerable projects which failed drastically inspite of having of having huge cash just because of absence of efficient and enthusiastic workforce.”
IMPORTANCE OF HUMAN RESOURCE MANAGEMENT Though very frequently neglected, all managers are in a sense, HR managers because they all deal with human resource to do their tasks, All manager’s get
involved in activities like recruiting, interviewing, selecting, training, promoting etc. at any level.
REASONS TO GIVE EMPHASIS ON HRM In strategy formation, proper emphasis must be given to HRM because in today’s information age all the companies have similar technologies, methods and exposures to the market so the only distinguishing factor is work force (HR) of the company. Due to globalization, every company has to compete with the best of the world and in such situation inefficient, demotivated and inactive work force can lead only to close down, low profit, zero goodwill situation. Even if HR is so important most of the managers neglect it because of the following reasons : • Responsibility of HRD : Top level manager think that HRD is solely responsible for development of Why do managers fail to include HRM as part of their overall corporate strategic plan ? How would you convince them to do so ?
2
human resource but actually all the heads of the functional managers must participate to get maximum output from their workforce. Many managers have the notion that every employee will give their best to get increment and promotion but this is not reality. It is well proved that all employees need motivation to give their best to the company. Many managers consider HRM as a time consuming, expensive and unnecessary burden on top level management but the fact is that HRD is very necessary for optimum utilization of other resources and smooth functioning
of the company. In the changing environment, Globalization has opened wide market for all the companies. It has caused more competition and more pressure to perform better than the rest of the world. It has also created lots of new opportunities to expand business in new territories. Only a well equipped, trained and efficient workforce can lead the company to success and prosperity in such an environment. Due to globalization the demand of talented people has increased as all companies want to hire best people of the field. So not only recruiting but also retianing the talented employees is a big challenge for HR department.
Ron Pilenzo in his article “A new Paradigm for HR” has reasoned out that “in changing environment HRM cannot survive only by doing “Hire and Fire Function” but it will have to retain its position in top level management by adding value in the strategic development process.” Many CEO’s and top level management question need of HRD management and upto some extent their question need appropriate answer too. If with changing environment the HRM cannot survive without upgradation. HR is necessary to achieve following advantages :
• Achieving competitive advantage :
According to Bernardin, competitive advantage means the ability to formulate strategies that place a favourable position relative to other companies in the industry.
Gaining this advantage also means to create uniquenesses in four sources namely
3
(1) Financial or Economic capability (2) Strategic product capability (3) Technological or Opertional Capability (4) Organizational capability The fundamental difference between the company and its competitor is efficient and productive workforce which root cause of success and survival in highly competitive market. Moreover in democratic world as said by Parter in “The Competitive advantage of Nation” Understanding the difference in national economic structures, values, cultures, institutions and historical contribute profoundly to competitive success of the organisation in the industry. However many times HR promote their own face value by adding irrelevant expensive and useless programmes. These purely tactical programmes prove not only costly but also proves irresponsible and risky to HR itself. The solution of the problem in tht HR msut know & understand the business of their organisation and then translate its values into strategies to maximise the potential of human capital. In the landmark book “In Search of Excellence” by Peters and Waterman, Peters has given notion “Management by wandering around means to get a clearer perspective, making regular field trips, talking to customers, holding informal meetings with employees, vendors, suppliers, union leaders.”
According to Dun & Bradstreet, 88.7% of business failures are due to management mistakes. And management mistakes are due to poor or lack of HR mangement hence success or failure mainly depend on HR management. Moreover HRM functions are not only limited to HRD but are also associated with other managements. For example if managers of various fields are trained to become better interviewers, trainers, coacher, motivators and communicators then it will result in better selection, improved performance, increase in effectivity and reduction in labour problems. Susan Meisinger the President & CEO of Sorceity of HRM in her commentary “Did they really Hate HR?” agreed that HRM is the most important and key driver of business performance but they are underdelivers. The biggest challenge to HR managers is to deliver what they have promised.
4
According to Ron Ribenzo “HRM is oversold and there is urgent need to change DNA of HRM and leverage the value of HR. The current vision of HR is flowed and defined by other professionals so HR must expand its horizon and take more responsibilities to survive.”
According to Delery “From a conceptual perspective, HR practices within
a system may supplement, substitute or interact in positive or negative ways with each other.” HRM formulates various policies at various levels of management. According to Wright and Boswell “HR policies refer to the firm or business units stated intention about the kinds of HR programme, processes, compensation policy, techniques that should be carried out in the organisation.” From the above discussion, it is clear that HR Management is core member of Management team, hence proper focus on function of HRM is equally important. As per Gary Dessler the main functions of HRM are as follows : - Conduting job analysis to determine the nature of each employee’s job - Planning labour needs and recruiting job candidates. - Selecting job candidates - Orienting and training new employees - Compensating employees - Appraising performance - Communicating for interview, counselling, desciplining and motivating - Building employee commitment. Human Resource Managers must have knowledge about. - Equal opportunity and afirmative (positive) action - Employee health and safety - Handling grievances and labour relations.
- Motivating and retaining workforce. However as per Gary Dessler, following mistakes must not be made by HRM - Making mistake of recruiting wrong person for the job - forming policies which cause high labour turnover - Forming policies which do not get best from the employees
5
- Mistake of wasting time in useless interviews, training or unproductive analysis. - Making mistake of taking grievance to court inspite of setting the matter mutually. - Mistake of neglecting training. - Mistake of adopting any unfair labour practices. All these mistakes will cause irrepairable damage to the functioning, efficiency, goodwill and last but not least profitability of the company so all HR managers must avoid these msitakes. HUMAN RESOURCE MANAGEMENT : ESSENTIAL FOR EMPLOYEES However the HRM must also play the role of employee advocacy. Means they should not only help management to get maximum from the employees but they must also take responsibility for clearly defining how management should treat employees and check any unfair practice to prevent employees’ exploitation. Then they have dual role by representating the interest of employees within the
framework of its primary obligation to higher level managment. The efficiency level of HRD will decrease if HRM is inclined to any of the group. In the changing environment because of Globalization, strict labour laws and everchanging techniques and mathods, the importance of HRM Department has increased bacause it has become extremely difficult to maintain loyal, efficient and motivated workforce where talent hunt is increasing day by day. HRM has to ensure that all the needs of the employees monetory, skill development, appraisal are satisfied and at the same time the company gets the job done in the most efficient manner. Carnegie, the king of Iron & steel industry of America once said, “take away all my property and resource but let me keep my team and I’ll reestablish the whole empire in less than four years.” The functions of HRM does not start with selection of proper candidate but it starts from accurate and precise job description because if job descriptions are outdated, insufficient and vague then the selection would be inappropriate and its following are the main advantages of an efficient HRM : - Accurate and precise job description to facilitate selection of ideal candidates - Proper selection of efficient, skilled and capable employees to increase productivity of workforce
6
- To train, promote, motivate and encourage employees to get out their best performance for the company and for themselves. - To retain core talent team by reducing turnover rate because huge amount of
money is spent on training and developing skills of the employee and their turnover causes new problems to the company. - Moreover one of the most important function of the HRM is to function as employee advocacy means to safeguard the interest of the employees to gain their loyalties - It also reduces labour turnover rate, labour grievance and legal actions for compensation. - HRM also undertakes function of training for developing skills and enabling the employees to adopt latest technology and mathods in the industry. - Due to globalization, the management has to deal with problem of cultural differences, operation method difference and business environment differences so the responsibilities of HRD increases more in this changing environment. - In the throat cut competition age of globalization, retaining efficient employees is more difficult than recruiting them so there is huge pressure on HRD to maintain talented employees by providing them adequate salaries, productive and positive work atmosphere, growth and job satisfaction by proper rewards, appraisal and recognition. HRM : ESSENTIAL FOR FUTURE GOALS OF THE ORGANISATION - HRM is also very helpful to sync the goal of the company with the goals of the employees to achieve better results and better performance. Many experts consider the HR as an expensive and unnecessary financial burden which can be avoided to increase overall profitability but the following points emphasise importance of HRM in increasing profitablility and efficiency of the
company. 1) Unskilled, untrained and errorprone employees make more mistakes which result into wastage of raw materials, low quality products, dissatisfaction, reduction of goodwill due to inferior product and higher labour turnoever rate. But all these adverse situations can be avoided by spending some money on training and developing skills of employees.
'TALENT MANAGEMENT : A NEW CONCEPT IN HRM:
2) If talented employees are not retained then competitors will grab them and cause great trouble to the company. According to Wilf Altam the latest buzzword in HRD is “Talent Management” In his article on talent was Wilf Altam has narrated that as the skill shortange bites, keeping hold of your best people is becoming war. Across the Globe all the companies are hunting talent to enhance their own performance. As noted by ‘Fortune Magazine’ recently all companies like countries are realising that their future prosperity depends not only on natural resources or even on capital resources but also human capital. Wilf Altam has given following six steps for successful talent management : 1) Talent management is everyone’s job in the organization 2) Talent is the single most important force creating strategic value for the organisation 3) The top level management should ask that why successful and ambitious individual would want to come and work for their organisation. 4) A human capital strategy is essential for supporting organisation’s strategic goals.
5) Talent is the engine which drives the whole organisation to the path of success 6) A talent powered organisation is an organisation which achieve distinctive capabilities and produce extraordinaty results
According Kay Thorne and Andy Pellant, the authors of “The essential guide to managing talent”, talent management should be called talent development because it is difficult to control or manage talent. Moreover it is very difficult for HRD to excess talent or evaluate talent because many talented people may not or cannot demonstrate their talent and many less talented employees can create larger than life picture of their abilities. Therefore HRD must scrutinise and evaluate the real talent and develop it. If any company gets award for “Best Company to Work for”, then many enthusiastic, talented and efficient candidates will willingly join the organisation and increase the efficiency of the work force. It will also reduce the labour turnover rate. Moreover money spent on training and development is not an expenditure but it is a valuable investment. Hence top level management must spend efficiently
8
and productively on training and talent development programmes. As proved by the famous case of the Royal Bank of Scotland, their significant growth from a low performing organisation to 1,35,000 employees and 35 millions customers is
due to the efficient role human resource management.
According to Greig Aitken, head of human capital strategy “The eight drive of efficient employee engagement are - employee recognition, performance and development opportunities, relationship with management, total reward, the work itself, product brands and reputation, leadership and work life balance.” As a organisation grows the complexities of HRD functions also increase. In a nutshell, it can be concluded that Human Resource is the most important part of overall management because it increases overall productivity of the organization and brings social welfare by increasing efficiency of the workforce and their income. Optimum utilization of resources also increase prosperity of the country. Therefore while strategy formation utmost importance must be given to excellent Human Resource Management by including a range of employee involvement methods and individualistic led to success approach. It will definitely achieve a great success on several fronts.
Strategic planning means long term and short term planning of various activities begining from goal setting to achieve the goal and the resetting new goals. While adopting strategies, managers give maximum emphasis on optimum utilization of resources like finance, capital, raw material, but quite often they neglect or give less importance to human resource. The clear fact is that HR is the most significant asset of the enterprise because optimum utilization of other resources depends entirely on efficiency of the Human Resource. As said by a famous management consultant “For many yearsit has been said that capital is the bottleneck for a developing industry. It is no longer holds true because it is the workforce and the company’s inability to recruit and maintain a good workforce tht does constitute the bottomneck for production. I don’t know any major project in any field backed by good ideas, vigor and enthusiastic team has been stopped by the shortage of cash but there are innumerable projects which failed drastically inspite of having of having huge cash just because of absence of efficient and enthusiastic workforce.”
IMPORTANCE OF HUMAN RESOURCE MANAGEMENT Though very frequently neglected, all managers are in a sense, HR managers because they all deal with human resource to do their tasks, All manager’s get
involved in activities like recruiting, interviewing, selecting, training, promoting etc. at any level.
REASONS TO GIVE EMPHASIS ON HRM In strategy formation, proper emphasis must be given to HRM because in today’s information age all the companies have similar technologies, methods and exposures to the market so the only distinguishing factor is work force (HR) of the company. Due to globalization, every company has to compete with the best of the world and in such situation inefficient, demotivated and inactive work force can lead only to close down, low profit, zero goodwill situation. Even if HR is so important most of the managers neglect it because of the following reasons : • Responsibility of HRD : Top level manager think that HRD is solely responsible for development of Why do managers fail to include HRM as part of their overall corporate strategic plan ? How would you convince them to do so ?
2
human resource but actually all the heads of the functional managers must participate to get maximum output from their workforce. Many managers have the notion that every employee will give their best to get increment and promotion but this is not reality. It is well proved that all employees need motivation to give their best to the company. Many managers consider HRM as a time consuming, expensive and unnecessary burden on top level management but the fact is that HRD is very necessary for optimum utilization of other resources and smooth functioning
of the company. In the changing environment, Globalization has opened wide market for all the companies. It has caused more competition and more pressure to perform better than the rest of the world. It has also created lots of new opportunities to expand business in new territories. Only a well equipped, trained and efficient workforce can lead the company to success and prosperity in such an environment. Due to globalization the demand of talented people has increased as all companies want to hire best people of the field. So not only recruiting but also retianing the talented employees is a big challenge for HR department.
Ron Pilenzo in his article “A new Paradigm for HR” has reasoned out that “in changing environment HRM cannot survive only by doing “Hire and Fire Function” but it will have to retain its position in top level management by adding value in the strategic development process.” Many CEO’s and top level management question need of HRD management and upto some extent their question need appropriate answer too. If with changing environment the HRM cannot survive without upgradation. HR is necessary to achieve following advantages :
• Achieving competitive advantage :
According to Bernardin, competitive advantage means the ability to formulate strategies that place a favourable position relative to other companies in the industry.
Gaining this advantage also means to create uniquenesses in four sources namely
3
(1) Financial or Economic capability (2) Strategic product capability (3) Technological or Opertional Capability (4) Organizational capability The fundamental difference between the company and its competitor is efficient and productive workforce which root cause of success and survival in highly competitive market. Moreover in democratic world as said by Parter in “The Competitive advantage of Nation” Understanding the difference in national economic structures, values, cultures, institutions and historical contribute profoundly to competitive success of the organisation in the industry. However many times HR promote their own face value by adding irrelevant expensive and useless programmes. These purely tactical programmes prove not only costly but also proves irresponsible and risky to HR itself. The solution of the problem in tht HR msut know & understand the business of their organisation and then translate its values into strategies to maximise the potential of human capital. In the landmark book “In Search of Excellence” by Peters and Waterman, Peters has given notion “Management by wandering around means to get a clearer perspective, making regular field trips, talking to customers, holding informal meetings with employees, vendors, suppliers, union leaders.”
According to Dun & Bradstreet, 88.7% of business failures are due to management mistakes. And management mistakes are due to poor or lack of HR mangement hence success or failure mainly depend on HR management. Moreover HRM functions are not only limited to HRD but are also associated with other managements. For example if managers of various fields are trained to become better interviewers, trainers, coacher, motivators and communicators then it will result in better selection, improved performance, increase in effectivity and reduction in labour problems. Susan Meisinger the President & CEO of Sorceity of HRM in her commentary “Did they really Hate HR?” agreed that HRM is the most important and key driver of business performance but they are underdelivers. The biggest challenge to HR managers is to deliver what they have promised.
4
According to Ron Ribenzo “HRM is oversold and there is urgent need to change DNA of HRM and leverage the value of HR. The current vision of HR is flowed and defined by other professionals so HR must expand its horizon and take more responsibilities to survive.”
According to Delery “From a conceptual perspective, HR practices within
a system may supplement, substitute or interact in positive or negative ways with each other.” HRM formulates various policies at various levels of management. According to Wright and Boswell “HR policies refer to the firm or business units stated intention about the kinds of HR programme, processes, compensation policy, techniques that should be carried out in the organisation.” From the above discussion, it is clear that HR Management is core member of Management team, hence proper focus on function of HRM is equally important. As per Gary Dessler the main functions of HRM are as follows : - Conduting job analysis to determine the nature of each employee’s job - Planning labour needs and recruiting job candidates. - Selecting job candidates - Orienting and training new employees - Compensating employees - Appraising performance - Communicating for interview, counselling, desciplining and motivating - Building employee commitment. Human Resource Managers must have knowledge about. - Equal opportunity and afirmative (positive) action - Employee health and safety - Handling grievances and labour relations.
- Motivating and retaining workforce. However as per Gary Dessler, following mistakes must not be made by HRM - Making mistake of recruiting wrong person for the job - forming policies which cause high labour turnover - Forming policies which do not get best from the employees
5
- Mistake of wasting time in useless interviews, training or unproductive analysis. - Making mistake of taking grievance to court inspite of setting the matter mutually. - Mistake of neglecting training. - Mistake of adopting any unfair labour practices. All these mistakes will cause irrepairable damage to the functioning, efficiency, goodwill and last but not least profitability of the company so all HR managers must avoid these msitakes. HUMAN RESOURCE MANAGEMENT : ESSENTIAL FOR EMPLOYEES However the HRM must also play the role of employee advocacy. Means they should not only help management to get maximum from the employees but they must also take responsibility for clearly defining how management should treat employees and check any unfair practice to prevent employees’ exploitation. Then they have dual role by representating the interest of employees within the
framework of its primary obligation to higher level managment. The efficiency level of HRD will decrease if HRM is inclined to any of the group. In the changing environment because of Globalization, strict labour laws and everchanging techniques and mathods, the importance of HRM Department has increased bacause it has become extremely difficult to maintain loyal, efficient and motivated workforce where talent hunt is increasing day by day. HRM has to ensure that all the needs of the employees monetory, skill development, appraisal are satisfied and at the same time the company gets the job done in the most efficient manner. Carnegie, the king of Iron & steel industry of America once said, “take away all my property and resource but let me keep my team and I’ll reestablish the whole empire in less than four years.” The functions of HRM does not start with selection of proper candidate but it starts from accurate and precise job description because if job descriptions are outdated, insufficient and vague then the selection would be inappropriate and its following are the main advantages of an efficient HRM : - Accurate and precise job description to facilitate selection of ideal candidates - Proper selection of efficient, skilled and capable employees to increase productivity of workforce
6
- To train, promote, motivate and encourage employees to get out their best performance for the company and for themselves. - To retain core talent team by reducing turnover rate because huge amount of
money is spent on training and developing skills of the employee and their turnover causes new problems to the company. - Moreover one of the most important function of the HRM is to function as employee advocacy means to safeguard the interest of the employees to gain their loyalties - It also reduces labour turnover rate, labour grievance and legal actions for compensation. - HRM also undertakes function of training for developing skills and enabling the employees to adopt latest technology and mathods in the industry. - Due to globalization, the management has to deal with problem of cultural differences, operation method difference and business environment differences so the responsibilities of HRD increases more in this changing environment. - In the throat cut competition age of globalization, retaining efficient employees is more difficult than recruiting them so there is huge pressure on HRD to maintain talented employees by providing them adequate salaries, productive and positive work atmosphere, growth and job satisfaction by proper rewards, appraisal and recognition. HRM : ESSENTIAL FOR FUTURE GOALS OF THE ORGANISATION - HRM is also very helpful to sync the goal of the company with the goals of the employees to achieve better results and better performance. Many experts consider the HR as an expensive and unnecessary financial burden which can be avoided to increase overall profitability but the following points emphasise importance of HRM in increasing profitablility and efficiency of the
company. 1) Unskilled, untrained and errorprone employees make more mistakes which result into wastage of raw materials, low quality products, dissatisfaction, reduction of goodwill due to inferior product and higher labour turnoever rate. But all these adverse situations can be avoided by spending some money on training and developing skills of employees.
'TALENT MANAGEMENT : A NEW CONCEPT IN HRM:
2) If talented employees are not retained then competitors will grab them and cause great trouble to the company. According to Wilf Altam the latest buzzword in HRD is “Talent Management” In his article on talent was Wilf Altam has narrated that as the skill shortange bites, keeping hold of your best people is becoming war. Across the Globe all the companies are hunting talent to enhance their own performance. As noted by ‘Fortune Magazine’ recently all companies like countries are realising that their future prosperity depends not only on natural resources or even on capital resources but also human capital. Wilf Altam has given following six steps for successful talent management : 1) Talent management is everyone’s job in the organization 2) Talent is the single most important force creating strategic value for the organisation 3) The top level management should ask that why successful and ambitious individual would want to come and work for their organisation. 4) A human capital strategy is essential for supporting organisation’s strategic goals.
5) Talent is the engine which drives the whole organisation to the path of success 6) A talent powered organisation is an organisation which achieve distinctive capabilities and produce extraordinaty results
According Kay Thorne and Andy Pellant, the authors of “The essential guide to managing talent”, talent management should be called talent development because it is difficult to control or manage talent. Moreover it is very difficult for HRD to excess talent or evaluate talent because many talented people may not or cannot demonstrate their talent and many less talented employees can create larger than life picture of their abilities. Therefore HRD must scrutinise and evaluate the real talent and develop it. If any company gets award for “Best Company to Work for”, then many enthusiastic, talented and efficient candidates will willingly join the organisation and increase the efficiency of the work force. It will also reduce the labour turnover rate. Moreover money spent on training and development is not an expenditure but it is a valuable investment. Hence top level management must spend efficiently
8
and productively on training and talent development programmes. As proved by the famous case of the Royal Bank of Scotland, their significant growth from a low performing organisation to 1,35,000 employees and 35 millions customers is
due to the efficient role human resource management.
According to Greig Aitken, head of human capital strategy “The eight drive of efficient employee engagement are - employee recognition, performance and development opportunities, relationship with management, total reward, the work itself, product brands and reputation, leadership and work life balance.” As a organisation grows the complexities of HRD functions also increase. In a nutshell, it can be concluded that Human Resource is the most important part of overall management because it increases overall productivity of the organization and brings social welfare by increasing efficiency of the workforce and their income. Optimum utilization of resources also increase prosperity of the country. Therefore while strategy formation utmost importance must be given to excellent Human Resource Management by including a range of employee involvement methods and individualistic led to success approach. It will definitely achieve a great success on several fronts.
