Introductory Note to Hrm

Introductory An Note on Human Resource Management

The profession of Human Resource Management (HRM) can be seen comprising Four Major Areas:

1. Personnel Administration

This concerns Timekeeping (Attendance), Leave Records, Wage and Salary Administration (which is also now called Compensation and Benefits' Management) and Legal (Statutory) Compliance with Labour Laws such as Factories Act, Payment of Wages Act, Safety Standards etc.

2. Industrial Relations (IR)

This concerns day-to-day Grievance Handling of mainly blue-collar employees, negotiations with Trade Unions or 'Collective Bargaining', and the settlement of Disputes as per the Industrial Disputes Act.

3. Welfare

This deals with the provision and maintenance of support services such as Canteen, Transport, Housekeeping, Security etc. Presently, in most organisations, all these services are 'outsourced' or subcontracted.

There is statutory compliance involved in other aspects of employee welfare since organisations need to follow 'Social Security' Legislation - Provident Fund, Employee State Insurance, Maternity Benefit for Women, Gratuity and Pension etc. Although many companies hire consultants or advisors for the form-filling and submissions to authorities, most work is done in-house in large and old companies. Newer companies like IT companies have outsourced this 'payroll' function also.

4. Human Resource Development (HRD)

This is considered as the 'sunrise' or 'cutting-edge' area in HRM and concerns developmental activities to improve employee productivity and morale. Typically, HRD includes a) Manpower Planning, b) Recruitment and Selection, c) Performance Appraisal and d) Training and Development.

Manpower Planning

Through the last decade, large manufacturing organisations in both Public and Private Sector have shown a preference for 'Downsizing' - reducing the number of employees or 'cutting the headcount'. (TISCO for instance, planned to reduce its manpower strength from 68,000 in 2000 to 55,000 in 2005 to improve efficiency. Nationalised Banks have reduced the workforce by over one and a half lakh employees through VRS in the last decade.)

Such 'downsizing' is done via four routes.

1. Freezing new recruitment

2. Offering Voluntary Retirement Schemes (VRS) to existing employees

3. Going in for 'Automation' - converting manual processes to mechanical

4. Subcontracting or ('Outsourcing') non-critical work to smaller companies

The aim is to achieve 'lean and mean' operations for competitive advantage.

Recruitment

With the rapid growth of Information Technology (IT), the Indian Industry now uses facilities on the World Wide Web to recruit people, especially for white-collar jobs. There are internet companies, popularly called 'Job Portals', specialising in recruitment via the web. Well known Indian job portals include naukri.com, monster.com, jobsahead.com etc. Using the World Wide Web or the internet for recruitment is also called as 'e-cruiting'. Most public and Private Sector companies now have their own websites that include a link to career opportunities available, through which interested candidates can send their CVs.

For blue-collar jobs, in the public sector, traditional avenues such as employment exchanges and print news-media like employment news continue to be used. Private sector companies recruit blue-collar employees in fewer numbers now and many prefer to recruit directly from technical training institutes like the 'ITI's, under an Apprenticeship Scheme. Casual labour is employed through Labour Contractors.

Selection

The use of psychological testing in employee selection for white-collar jobs has increased. Such tests include standard personality tests like the MBTI (Myers Briggs Type Indicator). For blue-collar jobs, Aptitude Tests that involve making people perform the actual operations under dummy conditions have been in use for a long time. Public Sector companies tend to have a Central Recruitment Board with a standard selection procedure as in the case of say Probationary Officers for Banks tested by the Indian Banks Association.

Performance Appraisals

Employees are now held accountable for individual targets set to them by their superiors. This is an outcome of the shift to Management by Objectives (MBO) popularized by Peter Drucker since the 1970s. Traditionally, employees were appraised for personal qualities like Initiative, Resourcefulness, Dependability etc. The MBO Approach says that what matters is not whether you have certain qualities or not; but whether you 'do the job' entrusted to you. So, employees should be appraised by the targets or 'Objectives' set to them. For instance, a Salesman should be appraised by whether he met his sales target and the Managing Director by whether he got the expected Return on Investment. Thus, there is a distinct shift from 'personality-based' appraisals to 'performance-based' appraisals. Objectives set to employees must be "SMART' - Specific, Measurable, Achievable, Relevant and Time-bound.

A recent addition to appraisal methods has been the 360-degree feedback, in which an employee's juniors, colleagues and customers also appraise his performance.

Some companies use 'Competency Mapping' for recruiting as well as appraisal, and subsequently, training.

Training and Development

The Internet has also changed training methods. Many companies now train employees round the year, instead of only in lean periods. This is possible with use of Computer-based Training (CBT). Trainees can see CDs, visit websites or the company's own internal computer network or 'IntraNet' to learn at their own pace.

More and more companies are realizing the importance of improving the behavioural skills -also called "soft skills" - of their