1. Introduction to Human Resource
Management
Session 1

2. The Management Process
Planning
Controlling Organizing
Leading Staffing

3. Human Resource Management at
Work
What Is Human Resource Management (HRM)?
The policies and practices involved in carrying out the
“people” or human resource aspects of a management
position, including recruiting, screening, training,
rewarding, and appraising.

4. Human Resource Management at
Work
Acquisition
Fairness Training
Human
Resource
Management
Health and
(HRM) Appraisal
Safety
Labor
Compensating
Relations

5. Definition of HRD
A set of systematic and planned activities designed
by an organization to provide its members with the
necessary skills to meet current and future job
demands.
According to Leon C. Magginson, the term human
resources can be thought of as “the total
knowledge, skills, creative abilities, talents and
aptitudes of an organisation’s workplace, as well as
the value attitudes and beliefs of the individual’s
involved.
It is just like any natural resource.

6. Objectives of HRM
 To create and utilize an able and motivated workforce, to accomplish
the basic organisational goals.
 To establish and maintain sound organisational structure and desirable
working relationships among all the members of the organisation.
 To secure the integration of individuals and groups within the
organisation by coordinations individual and group goals with that of
organsational goals.
 To create facilities and opportunities for development of individual ,
group and that of the organisation
 To provide adequate and fair wages, benefits, social security,
recognition, status, challenging work, prestige, incentives etc.
 To provide an opportunity for expression and voice in management
 To provide favourable atmosphere and proper working conditions
 To provide fair , acceptable and efficient leadership

7. Primary Functions of HRM
Human resource planning
Equal employment opportunity
Staffing (recruitment and selection)
Compensation and benefits
Employee and labor relations
Health, safety, and security
Human resource development

8. Secondary HRM Functions
Organization and job design
Performance management/ performance
appraisal systems
Research and information systems

9. Personnel Aspects of a Manager’s
Job
 Conducting job analyses
 Planning labor needs and recruiting job candidates
 Selecting job candidates
 Orienting and training new employees
 Managing wages and salaries
 Providing incentives and benefits
 Appraising performance
 Communicating
 Training and developing managers
 Building employee commitment

10. Personnel Mistakes
 Hire the wrong person for the job
 Have your people not doing their best
 Waste time with useless interviews
 Have your company in court because of discriminatory actions
 Have your company cited by labor inspectors for unsafe practices
 Have some employees think their salaries are unfair and
inequitable relative to others in the organization
 Allow a lack of training to undermine your department’s
effectiveness
 Commit any unfair labor practices

11. Basic HR Concepts
The bottom line of managing:
Getting results
HR creates value by engaging in
activities that produce the
employee behaviors that the
company needs to achieve
its strategic goals.

12. HRM in India
In the 1970s and 1980s typical HRM functions in organization included:
• Personnel and administration
• Industrial relations
• Labor welfare
Up to the mid-80s human resource management in Indian
organizations grew through various phases under the
influence of the following factors:
• A philanthropic viewpoint about doing good for workers
• A legislative framework
• Government policies
• Trade unions
• Emerging trends/concepts in management
• Changes in the economy

13. Human resource planning

14. What is Human Resource
Planning?
“an effort to anticipate future business and environmental
demands upon and organization and to provide personnel to
fulfil that business and satisfy that demand”
(Bowey, 1974)

15. Definition
It is the process by which a management determines how an
organisation should move the right number and the right
number and the right kinds of the people at the right places,
at the right time,to do things which result in both the
organisation and the individual receiving the maximum long-
range benefit.

16. Objectives
To maintain and improve the organisation’s ability to achieve
its goal by developing strategies that will result in optimum
contribution of human resources.

17. Activities of HRP
Forecasting
Making an inventory
Anticipating
Planning

18. Need
To carry on its work
Replacing old/ retired
To ensure smooth flow of work
To meet expansions programme
To meet new challenging need and technology advancement
To identify surplus or shortage in manpower.

19. Process

20. Deciding goals or objectyives
Estimating future organisational structure and manpower
requirements
Auditing human resources
Planning jib requirements and job descriptions developing
HR plan

21. Human Resource Planning ( HRP )
 Human Resource is the primary resource without which
other resources like money, materials etc cannot be put to
use.
 HRP is the process by which an organisation ensures that
it has the right number and kinds of people, at the right
places, right time, capable of effectively and efficiently
completing those tasks that will help the organisation
achieve its overall objectives.
 It plans into the number of workers needed to meet those
objectives.
 HRP is a process which includes forecasting, developing,
implementing and controlling by which a firm ensures that
they have right people at right time for things which they
are economically useful

22. Objectives of HRP
Ensures optimum use of human resource currently
employed
Avoid unbalance in the distribution and allocation
of manpower
Assess or forecast future skill requirement of the
organisations overall objectives
Provide control measures to ensure availability of
necessary resources when required
Control the cost aspect of human resources
Formulate transfer and succession policy

23. Steps in HRP
1) Assessing current Human Resources and
making an inventory
2) Forecast of future human requirement
3) Drawing up recruitment plan
4) Designing training and development plan

24. Relationship Between HRM and HRD
Human resource management (HRM)
encompasses many functions
Human resource development (HRD) is just one
of the functions within HRM

25. HRD Functions
Training and development (T&D)
Organizational development
Career development

26. Competing in the Global Economy
New technologies
Need for more skilled and educated workers
Cultural sensitivity required
Team involvement
Problem solving
Better communications skills

27. Need for Organizational Learning
Organizations must be able to learn, adapt, and
change
Principles:
Systems thinking
Personal mastery
Mental models
Shared visions
Team learning

28. Summary
HRD is too important to be left to amateurs
HRD should be a revenue producer, not a revenue
user
HRD should be a central part of company
You need to be able to talk MONEY

29. Compensation and Benefits
( Session 2)
Source : Personnel Management by C.B.Memoria & Strategic human resource
management (publisher prentice hall)

31. Employee Compensation
The term employee compensation includes remuneration,
incentives, fringe benefits and retirement benefits
The term employee remuneration includes both wages and
salaries.
 Wages are commonly considered as the price of labour paid to
the workers for the services renderd to the organisation
employing them.
Where the quantum of services rendered is difficult to measure
the payment is called salary.
Generally the wage period is shorter that the salary period.

32. Definitions : Compensation, wage &
salary
Compensation : money received in the performance of work
plus benefits and services that organization provide.
Money comes under direct compensation
Benefits are indirect compensation
Salary refers to the weekly / monthly rates paid to clerical,
administrative & professional employees (White collar
workers)
Wage (pay) : is the remuneration paid for the service of labor
in production, periodically to an employee/ worker
Wages usually refer to the hourly rate paid to such group as
production and maintenance employees (Blue collar employees)

33. Definitions : Wage levels & structure
Wage levels represent the money an average worker makes in
a geographic area or in his organization
Wage levels are only a average: specific markets or firms and
individual wages can vary wildly from the average
Wage structure is used to describe wage / salary relationships
within a particular grouping
The grouping can be according to occupation or organization

34. Three Concepts of Wages
1) Minimum Wage – A Minimum wage which is sufficient
tosatisfy at least the minimum needs of a worker
2) Fair Wage – Fair wage are equal to that received by workers
performing work of equal skill, difficulty or unpleasantness.
3) Living Wage – Is the highest amount of remunrationa dn it
would includes the amenities which a citizen living in a modern
civilised socially is entitled to expect, when tha econmoy of the
country is sufficiently advance and the employer is able to
meet the expanding aspirations of his workers.

35. Purpose of Compensation
Contribution based Ensure Equity
Remuneration
Attract talent Effective Administratively
Compensation Efficient Legal
Institutionalized Compliance
Processes
Motivate &
Retain Staff Reward Valued
Behavior

36. Factors influencing wage & salary
structure
The organizations ability to pay
Profits
Economic conditions
sector
Supply & demand of labor
The prevailing market rate
What competitors pay
Laws
Trade unions want parity irrespective of geographies
Functionally related firms need to pay same pay for same skills
Quantity & quality gets affected if prevailing market rate is not
given

37. Cost of living
Minimum pay criterion
Escalator clauses
Living wage
Higher than minimum wages
Based on opinion on how much needed to sustain worker &
family
Sore point in negotiations
Productivity
Difficult to pinpoint who / what is responsible

38. Trade union’s bargaining power
Stronger unions force high hikes
If subsequent productivity rise is not enough, company will
lose our
Job requirements
Difficult jobs pay better
Skill, effort, responsibility & job conditions help to grade jobs
Managerial attitudes
What the CEO desires
Psychological and sociological factors
Wage levels are equated with success

39. Goals of Compensation Plans
• Employers are able to attract and retain employees who will
contribute to the organization’s success
• Employees feel they are compensated/rewarded
fairly/equitably for their efforts and contributions to an
organization’s success

40. Employee Benefits
Total Compensation
3770 Beardshear Hall
Human Resource
Services
Employee Satisfaction
Supportive Corporate
Culture
Executive
Sponsorship
Rewards Benefits
• Bonus • Health Plans
• Salary Increases • Retirement Plans
• Promotions • Vacation/ time off
• Equity Offerings Salary • Paid Training
• Awards • Pay • Working Hours
• Recognition • Overtime (if in non-exempt
classification)
• New job assignments

41. What Factors Determines Pay
• Employer considerations
– Where employers compete for talent – local or national
– What talents an employer competes for – the skill/knowledge
level
– How strongly the employer wants to compete
• Lead the market
• Meet the market
• Lag the market

42. Employer Challenges
• Structuring employee benefit packages that meet the needs of
a diverse workforce – one size does not fit all
• Helping existing employees understanding the “value” of
their benefits
• Administering benefit programs – costly and time-
consuming. Not a profit-making venture!
• Continued rising health care costs
• Limited budgets – Benefits average 25% - 40% of Payroll in
most organizations
• Government restrictions/legislation/public policy

43. General Concepts
• Publicly traded companies will tend to structure pay/benefits that
incorporate more equity (stock options, savings match in
company stock, bonus tied to company performance, etc)
• Non-publicly traded companies/organizations will spend more
on non-cash incentives
• Governmental organizations will on average spend more on
benefits in lieu of salary

44. Fringe Benefits
The term fringe benefits refers to various extra benefits
provided to the employees, in addition to the compensation
paid in the form of wage or salary.

45. Types of Fringe Benefits
For Employment Security – Unemployment insurance, technological
adjustment pay, leave travel pay, over time pay, maternity leave,
holidays, jobs to sons / daughters etc.
For Health Protection – Accident Insurance, Disability Insurance,
Health Insurance, Hospitalisation, Life Insurance, Medical care, Sick
Benefits, Sick Leave etc.
For Old Age & Retirement – Deferred Income plans, Pension,
Gratuity, Provident Fund, Old Age Assistance, Medical for retired
employees, travelling concessions to retired, jobs to children of the
deceased etc.
For Personal Identification , Participation & Stimulation – Anniversary
Awards, Attendance bonus, canteen, Co-op Credit Societies,
Educational facilities, housing, recreational , safety measures etc.

46. Laws Affecting Employee Benefits
and Compensation
• Fair Labor Standards Act (FLSA)
• Employee Income Retirement Security Act of 1974 (ERISA)
• Age Discrimination and Employment Act (ADEA)
• Family Medical Leave Act (FMLA) of 1996
• Economic Growth and Tax Relief Reconciliation Act
(EGTRRA) of 2001
• Health Insurance Portability and Accountability Act of 1996
(HIPAA) (and amendments)
• Pension Protection Act of 2006
• many, many others

47. Evolution of Industrial Policy
 Industrial Policy Resolution 1948 Outlined the approach to
industrial growth and development Emphasized the importance of
securing a continuous increase in production and ensuring its
equitable distribution.
 active role for the State in the development of Industries. State
monopoly: Arms and ammunition, atomic energy and railway
transport State exclusively responsible for the establishment of new
undertakings in six basic industries-except where, in the national
interest, the State itself found it necessary to secure the cooperation
of private enterprise.
 Industrial Policy Resolution 1948 Rest of the industrial field open to
private enterprise though the State would also progressively
participate in this field.

48.  Industrial Policy Resolution 1956 - Objectives: Improvement in
living standards and working conditions for the mass of the people.
Reduction in income and wealth disparities Prevention of private
monopolies and concentration of economic power in different fields in
the hands of small numbers of individuals.
 Industrial Policy 1973 - Certain structural distortions called for
policy changes in IPR 1956. Compulsory export obligations, merely
for ensuring the foreign exchange
 Industrial Policy 1977 - Emphasis on developing smalll scale
industries and making adequate marketing arrangements. upgrading
the technology of small units. Promoting the development of a system
of linkages between nucleus large plants and the satellite ancillaries

49.  The Industrial Policy Statement 1980 - Formulated wrt the Industrial Policy
Resolution of 1956 to provide for (i) Optimum utilization of installed capacity; (ii)
Maximum production and achieving higher productivity; (iii) Higher employment
generation; (iv) Correction of regional imbalances; (v) Strengthening of the
agricultural base through agro based industries and promotion of optimum inter-
sectoral relationship; (vi) Promotion of export-oriented industries
 INDUSTRIAL POLICY 1991 - Govt . recognizes the need for social and economic
justice, to end poverty and unemployment and to build a modern, democratic,
socialist, prosperous and forward-looking India India to grow as part of the world
economy and not in isolation Greater emphasis placed on building up ability to pay for
imports through our own foreign exchange earnings development and utilization of
indigenous capabilities in technology and manufacturing as well as its up gradation to
world standards.

50. Reward Management
Definition - Reward Management is concerned with the
formulation and implementation of strategies and policies that
aim to reward people fairly, equitably and consistently in
accordance with their value to the organization”(Armstrong and
Murlis 2004)

51. Objectives of Reward Management
Support the organisation’s strategy
Recruit & retain
Motivate employees
Internal & external equity
Strengthen psychological contract
Financially sustainable
Comply with legislation
Efficiently administered

52. Basic Types of Reward
Extrinsic rewards
satisfy basic needs: survival, security
Pay, conditions, treatment
Intrinsic rewards
satisfy higher needs: esteem,development

53. Reward Options
Base pay--fixed or minimum wage/salary
Plussage--capability, qualification
Premia/Overtime
Performance related pay
Indirect pay--benefits, non-cash, shares
Non-monetary: recognition, advancement
“Total Reward” Pay, non-pay, flexible hours, cafeteria
benefits

54. Rewards by Individual, Team,
Organisation
Individual: base pay, incentives, benefits
rewards attendance, performance, competence
Team
team bonus, rewards group cooperation
Organisation
profit-sharing, shares, gain-sharing

55. Closing Thoughts
• How employees are “compensated” takes many forms –
salary, benefits, working conditions,
challenging/stimulating work, co-workers, etc. The right
“mix” for each person is different
• Pay policies will differ for every employer – some will
focus on cash compensation and some will focus on Total
Compensation
• The employer’s main goal is structuring compensation and
benefit programs is to be able to attract and retain the right
employees needed to help the employer be competitive

56. Closing Thoughts
• Employee benefits have huge budget impacts to employers
• Benefits are the “hidden paycheck” for employees
• Employees need to understand the “total compensation” an
employer provides – not just the “salary.” Employers need to
sell Total Compensation – not just salary
• Employees need to be “educated consumers” of benefit
programs – especially health care and retirement programs
• Employees should take advantage of retirement plan offerings
and save early (time value of $$) – and always save enough to
at least take advantage of employer’s matching contribution