CONCEPT OF HUMAN RESOURCE MANAGEMENT

Human Resource is the total knowledge, abilities, skills, abilities, talents and
aptitudes of an organization’s workforce. The values, ethics, beliefs of the
individual working in an organization also form a part of human resource.

HRM consists of three words human, resource and management.

Human-Refers to the people in the organization.

Resource-Refers to limited availability or scarceness

Management-Refers to how the limited resource utilize properly through people

for the achievement of organizational goals or objectives.

In simple words HRM is also a management function concerned with hiring,

motivating and maintaining people in an organization. It focuses people in the
organization.

HRM is a process of making efficient and effective use of human resources so that
the set goals are achieved.

DEFINITIONS OF HRM

According to Flippo “Personnel management, or say, human resource

management is the planning, organizing, directing and controlling of the
procurement, development, compensation, integration, maintenance and
separation of human resources to the end that individual, organization and social
objectives are accomplished”.

Michael j.jucius has defined human resources as a whole consisting of inter-

related, inter-dependent and interacting physiological, psychological, sociological
and ethical components.

Wendell L. Franch “Human resource management refers to the philosophy,

policies, procedures and practices related to the management of people within an
organization”.
The National Institute of Personnel Management (NIPM) of India has defined
human resource/ personnel management as “that part of management which is
concerned with people at work and with their relationship within an enterprise.
Its aim is to bring together and develop into an effective organization of the men
and women who make up an enterprise and having regard for the well-being of
the individuals and of working groups, to enable them to make their best
contribution to its success. ”

NATURE OF HUMAN RESOURCE MANAGEMENT

1. People-oriented

HRM has people oriented approach. It deals with every person working in the
organization from top to bottm.The employees are working in the organization
individually and as groups.

2. Part of process management

HRM is an integral part of process management. It is a managerial function.

Human resource function is performed by all the managers throughout the
organization rather than HR department only.

3. Comprehensive Function

The main aim of hrm is to managing people in the organization. This function
covers all types of people in the organization such as managers, supervisors,
officers, workers and others people.so it is called a comprehensive functions.

4. Pervasive function

HRM is a pervasive function because hrm is useful in every types of organization

such as govt.organization, sports organization, military organization, educational
organization, banking sector, health sector etc. It is also present in all functional
departments such as operation, production, marketing, finance, research, legal
etc.

5. Continuous process
HRM is a continuous process. It is also a never ending or ongoing process. It has to
be carried out every day and at everytime.It is concerned with the activities of
personnel in the organization. Activities happen in the organization continuously
so this process is called continuous process.

6. HRM both science as well as art

HRM both science as well as art.HRM consists of certain principles and techniques
so it is called as science. Managing people and getting things done through people
is an art. Hence it involves the application of theoretical knowledge into practices.

7. Multi-disciplinary in nature

HRM derives from various disciplines like sociology, anthropology, psychology,

economics etc.so this is called multi-disciplinary in nature.

8. Multi-dimensional in nature

HRM is multi-dimensional in nature. It consists of various aspects of hrm like

human relations development, procurements, industrial relations etc.

9. Goal oriented

HRM is always works with the people for the proper utilization of resources in the
organization for the achievement of organizational goals.

10. Maintain relationship

HRM always tries to maintain better relationships between people working in the
various level of management in the organization.

IMPORTANCE OF HUMAN RESOURCE MANAGEMENT

1. Proper utilization of resources

Effective utilization of both human and non-human resources through people

working in the organization for the achievement of organizational goals.

2. Developing personnel
HRM helps to developing talent in the organization through proper training and
development programme.

3. Hiring people

HRM helps to retaining right personnel in the organization through effective

human resource planning, recruiting, and selection process.

4. Maintaining relationship

HRM helps to maintains cordial relationship between top to bottom levels in the
organization. Maintaining balance between jobs and job-seekers.

5. Improved quality of work life

HRM leads to improved quality of work life. It providing better working

environment, job satisfaction, effective communication and job performance and
productivity.

6. Providing better opportunities

HRM helps to providing better opportunities for the personnel by providing

personal development of an employee.

7. Development of society

HRM plays vital role in the society. It helps to develop standard of living of the
people. It helps to provide employment for the socio-psychological satisfaction.

8. Motivating employee

HRM helps to motivating employees in the organization.Employess are motivating

in the organization through financial incentives and non-financial incentives.

9. Enhances economic growth

HRM plays a very important role for the development of the nation. Skilled and
effective human resources lead to proper utilization of resources. It helps to
generate employment and enhance economic growth.
10. Meeting challenges

For meeting challenges HRM helps to developing talents and providing

appropriate environment for effective utilization of their capabilities.

FUNCTIONS OF HRM

FUNCTIONS OF HRM

MANAGERIAL
OPERATIVE
FUNCTIONS
FUNCTIONS
PLANNING
PROCUREMENT
ORGANIZING
DEVELOPMENT
DIRECTING
COMPENSATION
CONTROLLING
INTEGRATION

1. PLANNING

Planning is the basic function of management. Planning is determining

the future course of action. It is a process of determining organizational goals or
objectives, policies, procedure or programmes for achieving them. It also involves
for human resource planning, selection, recruitment, training etc. Planning deals
with what to do, how to do, where to do and whom to do.

2. ORGANIZING

Organizing is a process by which organizing of various activities in a well-defined

structure. Organizing involves identifying the works, assigning the work to the
employees, to supervise that works proper authority should be assigned, proper
balance should be maintain between authority and responsibility.

3. DIRECTING
Directing is a process which involves directing the various activities for achieving
the organizational goals. The important elements of directing are communication,
order and instruction, leadership, motivation. It involves coordination between
different departments to ensure maximum utilization of resources.

4. CONTROLLING

Controlling is a process which can be compares the standard performances with

actual performance. If any deviation can occur then taking corrective actions.

OPERATIVE FUNCTIONS

Operative functions include procurement, development, compensation,

integration and maintenance functions of HRM.

1. PROCUREMENT

Procurement functions involve procuring the right candidate at right place at the
right time in the organization. It consists of various activities like manpower
planning, job analysis, recruitment, selection, placement, induction, transfer,
promotion, separation

MANPOWER PLANNING PROCESS

Manpower planning process or human resource planning is the process including

forecasting, developing and controlling by which a firm ensures that it has at the
right number of people and the right kind of people at the right places at the right
time doing work for which they are economically most useful.

JOB ANALYSIS

Job analysis is the process of collecting information related to work activities,

behavior and human recruitments etc. Job analysis divided into two parts job
description and job specification. Job description contains the information relating
to job and job specification contains the information about the individual.

RECRUITMENT
Recruitment is the process of discovering and procuring potential applicants for
actual and anticipated organizational vacancies.

SELECTION

Selection is the process of picking the appropriate candidates from the pool of
applications.

PLACEMENT

Placement involves assigning a specific job to each one of the selected candidates.

INDUCTION

Induction is the process of receiving and welcoming new employee to his/her job
and organization.

TRANSFER

Transfer refers to lateral movement of employees within the same grade, from
one job to another job.

PROMOTION

Promotion refers to the upward movement of an employee from one job to

another higher one, with increase in salary, status and responsibilities.

SEPARATION

Separation is a situation when the service agreement of an employee with his/her

employer organization comes to a end and employee leaves the organization.

2. DEVELOPMENT

Development functions improve the knowledge, skills, aptitudes and values of

employees in the organization. It consists of various activities like performance
appraisal, training, development, career planning and development.

PERFORMANCE APPRAISAL
Performance appraisal is the systematic evaluation of employee performance
both in quantities and qualities aspects.

TRAINING

Training is the process of enhancing the specific skills of an employee in the

organization.

DEVELOPMENT

Development is the process provided for improved decision-making and problem

solving. Development is for managers with strategic planning tasks.

CAREER PLANNING AND DEVELOPMENT

It refers to a set of programmes designed to match an individual’s needs, abilities

and career goals with current and future opportunities in the organization.

3. COMPENSATION

Compensation includes direct cash payments, indirect payments in the form of

employee benefits and incentives to motivate employees to strive for higher
levels of productivity. It includes salary, wage, incentives, fringe benefits,
perquisites.

SALARY

Salary refers to as remuneration paid to white collar employees including

managerial personnel. Salary is rated monthly.

WAGE

Wage is referred to as remuneration paid to workers. Wage is rated hourly.

INCENTIVIES

Incentives are the additional payments to employees besides the payment of

wages and salaries.

FRINGE BENEFITS
Fringe benefits include such benefits which are provide to the employees either
having long term impact like PF,gratuity,pension,medical benefits, insurance etc.

PERQUISITIES

Perquisites include company car, club membership, free residential

accommodation, paid holiday trips, stock options etc.

4. INTEGRATION

Integration concerned with the relationship between workers and employees.

This function maintains relationships in the organization. It includes motivation,
job satisfaction, grievance management, collective bargaining, conflict
management, participation of employees, discipline etc.

MOTIVATION

Motivation is the process of energies the inner drive of a person’s and actions
towards achievement of goals.

JOB SATISFACTION

Job satisfaction means is the favourables or unfavourableness with which

employees view their work.

GRIEVANCE MANAGEMENT

A grievance is any dissatisfaction of feeling of injustice in connection with one’s

employment situation that is brought to the attention of the management.

COLLECTIVE BARGAINING

Collective bargaining is a process in which representatives of two groups meet

and attempt to negotiate an agreement which specifies the nature of future
relationship between two. It helps to promote cooperation and mutual
understanding between the workers and the management.
CONFLICT MANAGEMENT

Conflict management is the process of limiting the negative aspects of conflict

while increasing the positive aspects of conflict. The aim of conflict management
is to enhance learning and group outcomes, including effectiveness of
performance in an organizational setting.

PARTICIPATION OF EMPLOYEES

Employees are take part in decision making concept of organization. Employees

are free to give better ideas to the management.

DISCIPLINE

A condition in the organization when employees conduct themselves in

accordance with the organization’s rules and standards of acceptable behavior.

MAINTENANCE

It is concerned with protecting and promoting employees while at work. For this
purpose, various benefits are providing to the employees. It includes safety, social
security, welfare schemes, personnel records, personnel research, and personnel
audit.

SAFETY

Safety is the condition of being protected from or unlikely to cause danger, risk or
injury.

SOCIAL SECURITY

Social security means the security or guarantee which is given to the labours from
the labours or management, regarding society’s facilities. Retirement, disability
and survivor benefits paid by the society/government to aged, former workers,
disabled, or their survivors.

WELFARE SCHEMES
It refers to the welfare activities done for the comfort and improvement,
intellectual and social of the employees over and above the wage paid. Welfare
schemes include recreational, medical, educational, transport facilities etc.

PERSONNEL RECORDS

It consists of details database of employees working in the organization.

PERSONNEL RESEARCH

Personnel research is the task of searching for and analyzing facts to the end and
that personnel problem may be solved or that guideline governing their solutions.

PERSONNEL AUDIT

Personnel auditing may be defined as the analysis and evaluation of personnel

policies, procedures and practices to determine the effectiveness of personnel in
an organization.