Meaning of Human Resource Management (HRM)
As we said that HRM is the management of people working in an organization, it is a subject related to human. For simplicity, we can say that it is the management of humans or people. HRM is a managerial function that tries to match an organization’s needs to the skills and abilities of its employees. Human Resource Management is responsible for how people are managed in the organizations. It is responsible for bringing people in organization helping them perform their work, compensating them for their work and solving problems that arise.
Growing Importance of HRM
The success of organizations increasingly depends on people-embodied know-how- the knowledge, skill, and abilities imbedded in an organization’s members. This knowledge base is the foundation of an organization’ core competencies (integrated knowledge sets within an organization that distinguish it from its competitors and deliver value to customers).
HRM plays important role in creating organizations and helping them survive. Our world is an organizational world. We are surrounded by organizations and we participate in them as members, employees, customers, and clients. Most of our life is spent in organization, and they supply the goods and services on which we depend to live. Organizations on the other hand depend on people, and without people, they would disappear.
Functions of HRM
Basic functions that all managers perform: planning, organizing, staffing, leading, and controlling. HR management involves the policies and practices needed to carry out the staffing (or people) function of management. HRM department regardless of the organization’s size must perform following human resource management functions…
- Staffing (HR planning, recruitment and selection)
- Human resource development
- Compensation and benefits
- Safety and health
- Employee and labor relations
- Records maintaining, etc.
- HR research (providing a HR information base, designing and implementing employee communication system).
- Interrelationship of HR functions.
Factors Contributing to the Growing Importance of HRM
- Accommodation to workers’ needs Workers are demanding that organizations accommodate their personal needs by instituting such programs as flexible work schedules, parental leave, child-care and elder-care assistance, and job sharing. The human resource department plays a central role in establishing and implementing policies designed to reduce the friction between organizational demands and family responsibilities.
- Increased complexity of the Manager’s job Management has become an increasingly complex and demanding job for many reasons, including foreign competition, new technology, expanding scientific information, and rapid change. Therefore, organizations frequently ask human resource managers for assistance in making strategic business decisions and in matching the distinctive competencies of the firm’s human resources to the mission of the organization. Executives need assistance from the human resource department in matters of recruitment, performance evaluation, compensation, and discipline.
- Legislation and litigation The enactment of state laws has contributed enormously to the proliferation and importance of human resource functions. The record keeping and reporting requirements of the laws are so extensive that to comply with them, many human resource departments must work countless hours and often must hire additional staff. Four areas that have been influenced most by legislation include equal employment, Compensation, safety, and labor relations. An organization’s failure to comply with laws regulating these areas can result in extremely costly back-pay awards, class action suits, and penalties.
- Consistency Human resource policies help to maintain consistency and equity within an organization. Consistency is particularly important in compensation and promotion decisions. When managers make compensation decisions without consulting the human resource department the salary structure tends to become very uneven and unfair promotion decisions also may be handled unfairly when the HR department does not coordinate the decision of individual manger.
- Expertise Now a days there exist sophisticated personnel activities that require special expertise. For example, researchers have developed complex procedures for making employee-selection decisions; statistical formulas that combine interviews, test scores, and application-blank information have replaced the subjective interviews traditionally used in making selection decisions. Similarly, many organizations have developed compensation systems with elaborate benefits packages to replace simple hourly pay or piece rate incentive systems
- Cost of Human Resource Human resource activities have become increasingly important because of the high cost of personal problem. The largest single expense in most organizations is labor cost, which is often considerably higher than the necessary because of such problems as absenteeism tardiness and discrimination.
- Why are we concerned with HRM?
- Helps you get results – through others.
Different managerial techniques help mangers to direct the performance of employees in desirable direction in order to achieve the organizational objectives. Through the efforts of others working in an organization, managers get things done that require effective human resource management.
- Helps you avoid common personnel mistakes
Qualified HR mangers utilize organization resources in such a way that helps to avoid common personnel mistakes like the following…
- Hiring the wrong person for the job
- Experiencing high turnover
- Finding employees not doing their best
- Having your company taken to court because of your discriminatory actions
- Having your company cited under federal occupational safety laws for unsafe practices
- Allowing a lack of training to undermine your department’s effectiveness
- Committing any unfair labor practices
- Helps you to gain Competitive Advantage
Among all the resources possessed by the organizations it is only Manpower or the Human resources that create the real difference. Because all organizations can have the same technology, they can possess same type of financial resources, same sort of raw material can be used to produce the goods and services but the organizational source that can really create the difference is work force of the organization. Therefore they are the main sources of innovation creativity in the organizations that can be used as a competitive advantage. In today’s competitive environment, these are the people which can create competitive
Key Terms
Controlling: Specific activities are to set performance standards that indicate progress toward long-term goals
Decisional roles included those of entrepreneur, disturbance handler, resource allocator, and negotiator activities.
Disseminator is a conduit to transmit information to organizational members
Disturbance handlers take corrective action in response to unforeseen problems
Effectiveness: A measure of the appropriateness of the goals chosen (are these the right goals?), and the degree to which they are achieved
Efficiency measure of how well resources are used to achieve a goal
Entrepreneur: managers initiate and oversee new projects that will improve their organization’s performance
Figurehead: duties that are ceremonial and symbolic in nature
Informational roles included monitoring, disseminating, and spokesperson activities Interpersonal roles included figurehead, leadership, and liaison activities
Leadership: hires, train, motivate, and discipline employees
Leading: Leading is stimulating people to be high performers It is directing, motivating, and communicating with employees, individually and in groups.
Liaison: contact outsiders who provide the manager with information. These may be individuals or groups inside or outside the organization.
Line manager: Authorized to direct the work of subordinates—they’re always someone’s boss. In addition, line managers are in charge of accomplishing the organization’s basic goals. Management: Management is the process of working with different resources to accomplish organizational goals.
Manager: The member of the organization who participates in the management process by planning, organizing, leading, or controlling the organization’s resources
Monitor: collect information from organizations and institutions outside their own
Negotiator role: discuss issues and bargain with other units to gain advantages for their own unit
Organizing is assembling and coordinating the human, financial, physical, informational, and other resources needed to achieve goals.
Planning: Planning is specifying the goals to be achieved and deciding in advances the appropriate actions taken to achieve those goals.
Resource allocators: responsible for allocating human, physical, and monetary resources Spokesperson: represent the organization to outsiders
Staff manager: Authorized to assist and advise line managers in accomplishing these basic goals.