The Role of Human Resource Management - Essay Example

HUMAN RESOURCE MANAGEMENT Contents INTRODUCTION Human resource Management is, perhaps, the oldest andmost widely researched subject in management. Yet, as technologies change, cultural diversities occur and people's expectations undergo fundamental shifts towards newer and newer dimensions. For instance, professionals are gaining more say in the running of organizations. Even where governance is by people who own the majority stakes, their own positions and the respect they command are contingent upon their competence rather than ownership. (Ahuja, 2005 880) " Management is the art of getting things done through other people. Management is the dynamic, life-giving element in every business. Without it the resources of production remain resources and never become production." (Sharma, 2004 11) This definition emphasizes that the managers achieve organizational objectives getting things done through the employees. Human resource Management is very essential for successful running of an enterprise. It ensures proper use of physical and human resources by deriving the best results. It leads to efficient performance and higher productivity. Human Resource Management is very essential for every organization to make productive use of human physical and financial resources or the achievement of the organizational goals. It helps in determination of objectives. No organization can succeed in tits mission unless its objectives an identified and well denied. Management helps in achieving these objectives by the efficient use of resources. The entry of multinationals has also brought in fundamental changes in the work culture, work ethics and remunerating patterns in many countries, all of which have a clear bearing on the career growth path of individuals. Added to this are the rapid changes taking place on the technological front, flattening hierarchies and making people come together more than ever before. Amidst all this change, the high ethical standards of an individual, be it a workman on the shop floor or the Chief Executive Officer, matter more now than ever. The dual ethical standards often maintained by people front-often the exact opposite when it comes of the way they conduct business are counterproductive in the long run. The new authority is emerging and organizations are member led, officer driven, customer focused; a team environment where the whole is greater than the sum of its parts; a flat management structure where employees and managers are learning rather than blame; a clear since of direction and purpose. A firm commitment to delivering high quality public services through a combination of direct-provision and effective partnerships. 2. ROLE OF HUMAN RESOURCE MANAGEMENT Human Resource Management plays a very important role in managing the mode in business organizations, which are complex and complicated. The role of management is summarized below. 1. Role in success. Human Resource Management plays a very important role the success of an organization. It helps in achieving group goals. Human Resource Management assembles and organizes the available recourses for the accomplishment of the goals of enterprise. It adds effectiveness to the efforts of group persons organized to achieve the given objectives. 2. Role in efficiency. Human Resource Management utilizes the available physical and human resources productively. It eliminates all types of wastage and leads to efficiency in all business operations. Thus it results in effective running of business activities. To secure efficiency of operations, management is concerned with reducing the cost of production and increasing the output. Through better planning, organizing and control, and the use of various cost-reduction techniques, efficient management leads to reduced costs and increased output. (Sharma, 2004 13) 3. Role in soundness of organization. Human Resource Management lays down a pattern of authority- responsibility relationship. The structure so formed shows the various interrelated positions, for which the right type of persons with right qualifications and training are selected. Human Resource Management helps an organization to survive in its dynamic environment. Good management enables an enterprise to adjust to the complex and ever-changing external environment. Thus management is responsible for survival and stable growth of an organization. 3. IMPORTANCE & UNIQUE BENEFITS OF HUMAN RESOURCE MANAGEMENT The industry is experiencing changes in societal, governmental, organizational and attitudinal areas, Rapid extension in the frontiers of knowledge, the continuing need for developing high-quality manpower, and the fear of managerial obsolescence, have necessitated executive development i.e. the ultimate reason for offering executive development within organizations is to improve a manager's attitudes, knowledge and skill to ensure the organizations' is to improve a manager's attitudes, knowledge and skill to ensure the organizations' survivals, growth, planned financial returns, and their ability to adapt to changing circumstances. Arising out of these benefits, the importance of Human Resource management may be outlined as follows. (Sharma, 2004 16) 1. Helps in achieving group goals. Human Resource Management assembles and organizes available resources for the accomplishment of the goals of an enterprise. It adds effectiveness to the efforts of a group of persons organizing to achieve given objectives. 2. Optimum utilization of resources. Human Resource management utilizes available physical and human resources productively. It eliminates all types of wastage and leads to efficiency in all business operations. Thus it results in effective running of business activities. 3. Reduces costs. To Secure efficiency of operations, Human Resource Management is concerned with reducing the cost of production and increasing the output. Through better planning, organizing and control, and the use of various cost- reduction techniques, efficient management leads to reduced cost and increased output. 4. Establishes a sound organization. Human Resource Management lays down a pattern of authority - responsibility relationship. The structure so formed shows the various inter related positions, for which the right type of persons with right qualifications and training are selected. 5. Maintains equilibrium. Human Resource Management helps an organization to survive in its dynamic environment. Good management enables and enterprise to adjust to the complex and ever changing external environment. Thus management is responsible for survival and stable growth of an organization. 6. Co-ordinated human efforts. Human Resource Management provides leadership and guidance to the workers. It also motivates them with the help of various incentive schemes. It reconciles their personal interests with the organizational objectives. This leads to better co-coordination among the human resources. 7. Economic development. The development of a country is virtually dependent upon the quality of management of its resources. It is only efficient management that enables the developing countries to make better utilization of their physical, financial and human resources for speedy economic development. 4. Organizations and Environment An organization does not exist in a vacuum. Organization exists in association with its environments, which provide resources and limitations. An organization must continuously adapt to its environments, which are constantly changing. We know the organizations may either be temporarily (short lived) or long life (long lived). The short-lived organizations have only immediate objectives and development for renewal is not very important. Such organizations have little concern for environmental factors. These organizations are simple, informal and of unstable structures: The long life organizations have immediate attainable objectives. In these organizations the individual objectives are compatible with organizational objectives and elaborate hierarchy of subordinates and their goals. Organizations involve People Another factor is that organizations involve people, therefore, the involvement of people and interaction, communication, coordination, sometimes interference and conflict between them as inevitable features of organization. People in the organization carry out activities, in some kind of organized way, towards certain objectives. These several objectives add up eventually to the objectives of the organization as a whole and the objectives of the organization as a whole are concerned with and affected by the relationship between the organization and its environment. Therefore the basic features of organization are: i) Objectives of the organization. Without the concept of objective the organization as whole is without a focus. The relationship between the organization and its environment is both affected by and provides some of the determinants of the objectives of the organization. Organization design begins with the identification of organizational objectives. There is no rational way of devising what the main structures of an organization should be without an understanding of what the organization is for and what it is trying to achieve. It is essential, therefore, to be clear, not only about what an organization objectives are, but about the (ii) People and Work. In an organization therefore whether its Structure is formalized or not, and whether or not things done in human and reasonable way, the individual's freedom of action, his autonomy, will always be bounded and it will never be absolute. iii) Resources. Organizations objectives require activities to be carried out that arc beyond one person's efforts. Thus in an organization, there, is or should be a relationship between the activities of every person in it and those of every other person. A serious problem in same organization is that the resources available in the organization as a whole are not effectively allocated into areas of work where they are needed. Elements of an Organization The long-lived organizations have a complex, formal and relatively stable structure. The objectives of long life organization are dynamic and changes in environment will bring a change in its objectives. The environment determines the range of organization's activities. The environment evaluates and determines the future resources and the constraint that will be placed on the organization. Following are the various fundamental elements of an organization. 1. People 2. Physical resources 3. Market condition 4. Economic and market conditions 5. Attitude 6. Legal constraints People. The very first element of an organization is its people. Unless people of the organization interact and do the assigned job, there would be no organization. Physical resources. The manufacturing organization must have the raw materials to make their products. Climate. The climate affects the location and operations of an organization. PHYSICAL RESOURCES MARKET CONDITIONS ATTITUDES ECONOMIC CLIMATE OF PEOPLE (ORGANISATION) PEOPLE OF THE ORGANISATION OPPORTUNITIES ORGANISATION DETERMINES KEEP EXISTINGING/ THE SUCCESS GROWING OF AN ORGANISATION FEEDBACK THE ENVIRONMENT REACTS TO THE OUTPUT AND DETERMINE THE FUTURE INPUTS OF THE ORGANISATION SOCIAL LEGAL FACTORS FACTORS Fig 1 Economic and market conditions. The governmental monetary and fiscal policies are of profound effects. Some environments emphasize individual capitalism or socialism or communism. During the depression periods the business may be hard pressed just to survive. Similarly change in the tastes of consumer affects the supply and services of the goods. Attitude. At times its importance is not realized because of its intangible nature. The social, religious, political and cultural attitudes are of significant importance in an organizational environment. Legal constraints. Laws are the rules under which an organization must operate. Laws are more in the background but they do influence directly the organizational activities. Environment analysis. It is a process by which the corporate management assisted by specialists tries to identify the opportunities and risk in the environment in which an organization operates. The identification always helps the management in planning alternatives for corporate planning. The environment is the pattern of all internal and external conditions that affect the survival and development of an organization. Because of the growth of science, technology, research and development activities, the organizational environments of the firm are rapidly changing. There not only exist predictable changing environments but unpredictable turbulent environments. There is a greater degree of interdependence among the economic and other factors of society. The various environment factors such as economic, social, technical, legal are meshed together. Organization and environment can always interact in one of the three ways: 1. The organization influences and controls the environment. This is termed as over-active approach where terms are dictated to environment. 2. The environment and organization adapt to each other. This is termed as the adoptive approach. 4. The clew cut interaction between the organization and environment. It is always better for the organization growth and development that environments and organization interact with each other. THE INTERNAL AND EXTERNAL ENVIRONMENT No organization exists in isolation. Every organization exists in an environment where it interacts with, and is influenced by, the general public, specific groups (whether they be customers, clients, suppliers, pressure groups, etc) and/or various government bodies. The organization is also affected by the economic, political, legal, social, technological and international variables of the times. All managers, whether they work in the public or private sector, operate in the same external environment. They face common pressures that the environment exerts on them. However, the nature of their work and the type of organization they work for will determine how these common environmental factors are perceived - whether they are seen as positive or negative, threats or opportunities. (Yvonne 15) As well as being aware of the influence of the external environment, managers should also be conscious of the internal environment of their organization. Factors to consider include: the culture/climate of the organization; the pressures being generated by change (whether the introduction of new technology or a recent takeover or merger); union or professional association activities; changing workloads; staffing issues; the nature of reporting and communication channels; level of morale; the profitability and/or effectiveness of the organization. Some factors, relating to both the external and internal environment, directly impact on the organization and others have less impact. For example, factors that have direct impact on the organization include competitors, customers, suppliers and unions. Examples of those factors that have an indirect influence on the organization include the media, lobby groups, current government monetary policy, etc. (a) Managers should keep informed about important factors and developments in both their external and internal environments. They can do this by constantly 'scanning' their environment, which is, by establishing and maintaining a network of contacts, maintaining good communication channels, keeping up-to-date in their field and monitoring important issues and activities. (Yvonne 16) Internal Environment Following are the factors leading to internal environments: 1. Forecasts of industry and demand for expansion strategy. 2. Efficiency of the firm vis--vis efficiency of the industry. 3. Competitors information. 4. Consumer data for firm. 5. Information related to their costs and profits. 6. Physical location of the industry. 7. Labor-management relation. 8. Morale of the people working in the organization. 9. Team spirit. STRUCTURE TASKS TECHNIQUES PEOPLE Fig. 2 The internal environment factors of an organization are interconnected and change in one will bring change in another. Fig. 2 show four variables of internal environment. Changes in internal and external environment are going in a planned or unplanned manner in every organization. The environment may be either internal environment (EI) or the external environment (EE). The following alternatives in which environments operate: 1. (EI) - (EE): Internal control is more than External control. 2. (EE) - (EI): The external control is more than internal control. 3. (EE) - (EE): All the controls are external. 4. (EI) - (EI): All the controls are internal. In case of more internal control there will be more leverage with the management to control the environment. In case of more external control there will be less leverage and in case of total external control there will be no leverage at all. In order to overcome certain undesirable effect of the environmental factors the organization's capability to anticipate and absorb the changes are must. Scanning of the environments is very important in case of turbulent environments. Scanning is an interdisciplinary in nature. Scanning group must have ethical philosophy. Ethical and unethical is a relative and study of this is to influence environment. It is important to know whether we are doing it consciously or unconsciously. The value of the chief executive is very important because decision-making does not lie with the scanning group. Thus any scanning group can best replace top management judgment. The scanning group has to find out what will be the implication of each decision. In an organization the scanning group should be given enough freedom to operate in the organization. The scanning group works mainly for the corporate management for various operational areas such as Marketing, Finance and Production. In an organization one of the important thing is that it must expand and diversify so as to meet the aspirations of its members otherwise there will be internal frustration among the members. The scanning group if have the capability to anticipate the changes in the internal environment through data collection better forecasting and long range planning then most of the internal problems of the organization can be foreseen well in advance and the suitable measures can be taken to overcome these problems. The main aspects of the external environment in a business organization could be classified as: (i) Political Stability. Politics is an art based on certain understanding. Political stability is of great importance to a manager. In case of stable political situation, a business manager deals with a known condition in making his plans. Under the unstable political condition it is difficult to forecast the environment. (ii) Government Control. Government control is of great importance to the organization. In a country following are a few controls: -Classification of Industries in three categories (A. B and C) -Industrial Licensing Policy. -Industrial policy resolution (iii) Fiscal Policy. The closely related to the government control is the effect of Government fiscal and monetary policy. 1. Increasing and decreasing the existing taxes. 2. Exempting small-scale industries from certain restrictions to encourage their growth. 3. Special investment offers. (iv) Economic. The national income plays a very important role in the purchasing power and hence in the demand for the various products of the Organization. Following are a few important factors: (i) Economic disparity. (ii) Effective demand (It is the demand backed up by the purchasing power). . (iii) Pricing policy (It helps in monetary resource allocation). The economic factors are very essential for the purpose of manpower planning and wage administration in an organization. (v) Technology. The basic object before a manager is to reduce the manufacturing costs. Therefore, the management must weigh the cost and benefits of new technology by considering the following factors: -New process resulting cheaper and more efficient production. -Progress in R and D. -New Products. -Machine-Product value. -Value added concept. -Man-Machine balance. (vi) Social Environments. . Following are the factors affecting social environments: -Social segments -Cultural factors -Social distance -Cultural variations -Social disparity (vii) Ecological Environment. Following are the factors affecting ecological environments: -Land pollution -Water and Air Pollution -Non-renewal matters. -Sewage disposal. Thus no organization is functioning in a water-tight compartment but has to consider the social and ecological environments in order to function efficiently. Social Responsibility of Management Social responsibility is defined as behavior for the social good, beyond that demanded by the law or common custom. In organizations it operates at the micro and macro levels. At the micro level it is an ethical issue for the individual manager, who has to make business decisions within his or her own personal framework of what is morally right or wrong. At the macro level it refers to the role organizations should play in addressing social problems and attempting to improve our society generally. An area where many businesses show their attitude towards social responsibility is in pollution control. For example, a certain amount of pollution control is required by law, and is therefore expected behavior. When a business goes beyond the basic requirements it is showing a degree of social responsibility. (Yvonne 18) BENCHMARKING OUTSTANDING PRACTICE Innovative ways the successful companies have managed their human resources to remain competitive in today's global market. There is a need for benchmarking and adopting outstanding practices and processes from organizations any where in the world in order to help the organization to improve its performance. Benchmarking is an on going task at all levels of business in finding and implementing the world's best practices. It is classical Total Quality Management. The approach has proved to be effective not only in providing new ideas for change but also in building a commitment to change. Purpose of Human Resource Department One of the important objective/purpose of Human Resource Department is to build the organization culture, viz., Vision Values Processes and People. Hunan Resource Department goals are based on the super ordinate goals of the organization. For culture building the specific values of the organization are identified that need to be inculcated in the employees. Some of the values are openness, empowerment and delegation, ownership, commitment and accepting mistakes. HRD can build a system of empowerment and ownership among the employees to develop a sense of commitment. Employees are constantly motivated to involve themselves to produce best developmental activities and the organization is sensitive to the employee's feedback and shares with employees regularly the organizations future plans and programmes and other issues related to the management. Integrated Human Resource Modules Most of the organizations are undertaking HR Studies In-house or with the help of Consultants. The objectives of the study are to undertake the following: Position Analysis Position Evaluation Objective Study Performance Contract Human Resource Deployment and Compensation Study. Because of the fast changing technological, cultural, diversities, there is a need to achieve optimum utilization of resources. HRD is undergoing conceptual change and HRD can no longer remain silent spectators as regards to organization policies, achievement of organization mission, objectives and goals at all levels/function of the organization. HRD is playing a leading role of change agent by way of introducing Quality Management. Some of the concepts which were originated from Japan have become quite popular in India are now introduced through HRD namely: Total Quality Management (TQM) Total Productive Maintenance (TPM) Just in Time (JIT) Quality Circles (QCs) etc. Total Quality Management refers to an integrated organization approach in satisfying customers (both external and internal) by meeting their expectations on a continuous basis; by involving all the employees or organization, working on continuous improvement in all products/processes, and adopting structured problem-solving methods. The main elements of TQM are: A quality policy and commitment to it. Teamwork and positive culture. Total employee involvement (TEI); Appropriate methods/process/technology which prevent the problems Problem solving tools/procedures (quality system approach). Education and Training Quality audits and reviews. Continuous improvement. Total Employee Involvement (TEI), can be attained by company wide training and education in quality systems and practices. The introduction of small group activities, called quality circles, in Indian industries has also made employees participate in the quality improvement programme, resulting in an enhancement in quality. The implementation of TQM is an integrated approach, and for an organization in pursuit of excellence with a long-term perspective, its implementation as an integrated approach along with JIT, TPM and TEI can be more rewarding. Of course, this involves certain changes in the employees at all levels. Total Productive Maintenance (TPM) ,is directed at improving equipment. TPM aims at maximizing equipment effectiveness with a total system of preventive maintenance covering at entire life of the equipment. Total Productive Maintenance involves everyone in all departments and at all levels. Just in Time (JIT) is the approach to material management and control. Just in Time is more than a new way of handling material management. Just in Time is a structural approach in a manufacturing organization focused on improving timeliness; quality, productivity and flexibility initializing various resources, as well as work simplification and waste reduction. Quality Circles (QC) is a small group activity to solve work-related problems, involving members performing the same task. The management should facilitate this small group activity to function more effectively. MANAGING HUMAN RESOURCE IN AN ORGANIZATION The term Human Resource Management, as opposed to 'personnel', signifies the broader role the management of people now plays in organization, and is closer links with strategic planning. An induction program, which takes place as soon as a person has been hired, can reduce staff turnover and enable the new employee to become effective and reach expected performance levels more quickly. Induction programs are important in that they help shape the new employee's views of the organization. The fact that an organization's turnover rates are nearly always highest amongst new employees underlines the need for effective induction programs. (Yvonne 108) Training and Development Training is a specific activity, which provides employees with knowledge, and activities, which provides employees with knowledge and skill to satisfy immediate job requirements. Development refers to more general activities, which prepare employees for longer-tem opportunities. Training plans are a useful tool for identifying and planning the training activities of a work area .On the job training is the most common approach, although off the job training is more appropriate in some circumstances. Training is usually taken to mean providing employees with knowledge or specific job skills to satisfy immediate job or organizational needs. This could range from assembly workers learning new techniques to enable them to increase output, to managers learning how to better manage their time. (Yvonne 110) Development usually refers to preparing employees for longer-term opportunities. It encompasses both personal and organizational needs and has a more general focus. Providing training and development usually follows four steps: (b) Identifying employees training and development needs; (c) Developing a training plan for each individual; (d) Selecting or designing or conducting training activities; (e) Evaluating the results. There are three main methods of identifying training needs in an organization: i. New employees - training is required immediately in order for the employees to perform the work satisfactorily. ii. Performance appraisals - an employee's output may indicate that further training is required, or he or she may request training in a specific area. iii. Future needs - employees are trained in anticipation of future needs (often involving the use of technology). Care must be taken to ensure that training will solve a specific problem. Sometimes other options may be more effective, such as: changing the job, or some aspect of it; changing the supervisory s le; changing the salary or wage structure; or introducing flexible working hours Sometimes various types of training activity are used simply to motivate employees. Some organizations develop formal training plans for their employees. Such training plans tend to be more specific for people in the lower levels of the organization, and more general for people at higher levels. Sometimes such training is part of the career development for certain individuals. Improving The Work Environment People whose work is highly specialized, repetitive and routine may become dissatisfied with their job. This dissatisfaction often shows itself by reduced output, increased absenteeism and high staff turnover. This very quickly reduces effectiveness of a work area, and influences the effectiveness of the whole organization. A number of approaches have been developed to try to overcome this problem. (Yvonne 115) i. Job Enlargement Job enlargement increases the scope of the job. Employees are given more variety in order to increase job satisfaction. Usually various work functions from a horizontal slice of a work area are combined, giving employees more tasks to perform. Sometimes tasks are rearranged between several employees so that each employee gets a sense of the wholeness of a job. ii. Job Enrichment With this approach individual employees may be given responsibility for deciding the best way to perform a particular task, and for correcting their own errors. They may also be involved in making decisions, which affect their own work areas. iii. Job Rotation Job rotation is a system whereby employees move from one job to another. This rotation may occur over various time spans, from, say, every two hours, to every week or month. It gives employees increased variety, and helps to relieve the monotony of routine, repetitive work. It also gives employees the opportunity to develop different skills, and mix with different people iv. Semi-autonomous Work Groups Semi-autonomous work groups are groups of employees working together, who se largely self-sufficient in terms of managing the tasks and functions for which they are responsible. This approach gives employees a sense of identity with, and responsibility to, the group. Job enlargement, enrichment, rotation and the use of semi - autonomous work groups are all approaches which can be used to reduce employee dissatisfaction with routine, repetitive jobs. Other approaches include flexible working hours and compressed working weeks. (Yvonne 116) A basis for effective discipline in an organization is good communication, co-operation and morale within an organization. Employee self discipline is more effective than manger imposed discipline. Counseling or disciplinary interviews aim to correct inappropriate behavior and prevent its recurrence. Promotions, transfers and demotions refer to employees' changing jobs, upwards, sideways or downwards, in an organization. Promotions are made in recognition of superior performance, while transfers and demotions may occur or a member of reasons Separations may be caused by a variety of beacons and fall intone of the following categories: resignation, dismissal, retrenchment or retirement, Each category must be handled correctly, and with sensitivity, exit interviews are a useful means of collecting information on reasons for resignations. Counseling should take place or be available to employees facing dismissal, retrenchment or retirement. (Yvonne 119) CONCLUSION Human Resource management plays an important role in the success, efficiency and soundness of an organization. Success of any organization is determined by the 'Team', its people, their caliber and their attitude to succeed and out perform. Employees are the only resource, which is capable of self-propulsion and value addition. Unlike any machinery that gets devalued or depreciated with time and age, the human resource i.e. people appreciates with age and experience. So they are very special but this fruitful only if people are developed and kept satisfied. It is unlikely that any improvement can be made in terms of production, productivity, quality or customer service until people are developed. References Ahuja K. (2005)Human Resource Management. Kalyani Publishers. Calcutta. Pp 880-883 Sharma MC. (2004). Business Studies. S Chand & Company. New Delhi. Pp 10-20 Steven Silbiger. A Ste By Step Guide to Mastering The Skills Taught in Top Business Schools. Piatkus Books. London. Pp 103-141 Prasad LM, (2006) Organisational Behaviour, Educational publishers, Daryaganj, p 262-287 Yvonne Mc Laughhlin. Business Management: A Practical guide for Managers, Supervisors and Administrators. Business Information Books. Pp 5-120 Read More