Module 4

Introduction to Human Resource Management

Contents

Importance Manpower Planning: Concept, Features and objectives Manpower Planning Process Recruitment: Sources Selection: Process Selection tests: Types of tests

Meaning of Human Resource Management

Human Resource Management is responsible for how people are treated in organizations. It is responsible for bringing people into the organisation, helping them perform their work, compensating them for their labour and solving problems that arise by Cherrington. It is a planned approach to managing people effectively for performance.

It deals with issues related to people such as compensation, hiring, performance management, organisation development, safety, wellness, benefits, employee motivation, communication, administration and training.

Importance

Attract and retain talent Train people for challenging roles Develop skills and competencies Promote team spirit Develop loyalty and commitment Increase productivity and profits Improve job satisfaction Enhance standard of living Generate employment opportunities.

Manpower Planning

Manpower Planning is the process by which a firm ensures that it has 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. - E. B. Geisler

Features of Manpower Planning

It is future oriented It is a continuous process Integral part of Corporate Planning Optimum utilization of resources Both Qualitative and Quantitative aspect Long term and Short term Involves study of manpower requirement

Objectives of Manpower Planning

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Optimum utilization of human resources currently employed in the organization. To reduce imbalance in distribution and allocation of manpower in organization for various activities. To ensure that the organization is wellequipped with the required Quantity and Quality of manpower on a sustained basis. To control cost of Human Resources employed, used and maintained in the organization.

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Helpful in formulating policies of transfer and promotion of organization's employees. It is useful in controlling measures to ensure availability of necessary human resources whenever required in the organisation. To recruit and retain human resource of required Quantity and Quality.

The HR Planning Process

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3. 4. 5. 6. 7.

The steps involved in HRP process are as under: Collection of Information. Forecasting the Manpower Requirements. Preparation of Inventory. Matching Process. Preparation of Plan. Approval of HR plan. Review of HR plan.

Strategic Planning

HR Demand

HR Supply

Variances

End

If Surplus

If Shortage

Decision Layoff Retirement etc.

Decision Overtime Recruitment etc.

End

End

Collection of Information
In the first step, the data needs to be collected relating to the corporate objectives, annual production target, growth plan including retiring of old units, modernization, etc. On the basis of this data the number of persons required to achieve these objectives will be determined.

Forecasting the Manpower Requirements

This phase of the process involves estimating: How many employees will be needed? What kinds of employees will be needed? These things have to be determined area wise and department wise. A proper job analysis needs to be done for the vacant position. What type of candidates will be required for which positions with what type of skills, qualification and experience required must be forecasted.

Preparation of Inventory

Here the existing manpower inventory with the organisation must be determined. It is to be found out whether there is any employee in the organisation itself who can be promoted or transferred to the vacant position or not must be considered.

Matching Process

In this step, the manpower available is matched with the manpower requirement forecasted in step 2. If the candidates available in the organisation can be used for required position. For the remaining positions the candidates can be searched from outside the organisation from various sources which are available for the external recruitment.

Preparation of Plan

Subsequent to the demand and matching with the category wise opening balance, separation and closing balance the number required calculated.

supply data of desired must be

Approval of HR plan

This prepared plan is then submitted to the higher level committee for moderation and then to the top management level for the ultimate approval. Once the plan is approved it is put into action.

Review of HR Plan

The high level corporate monitors the progress of the plan. They make an annual evaluation of the actual performance of the plan with the desired performance and ascertain the deviations if any.

Recruitment

Acc. To Edwin Flippo, Recruitment is a process of searching for prospective employees and stimulating them to apply for the jobs in the organisation. Dale Yoder says, The recruitment policy is concerned with quality and qualifications of manpower.

Sources of Recruitment
INTERNAL
Transfers Promotions Upgrading

EXTERNAL
Press Advertisements Educational Institutes Placement outsourcing agencies/

Demotion
Retired employees Retrenched employees Dependents and relatives of deceased employees

Employment Exchanges Labour contractors Unsolicited applicants Employee Referrals Recruitment gate Walk-Ins at factory

Internal/ Direct Sources

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Transfers : the employees are transferred from one department to another according to their efficiency and experience. Promotions: The employees are promoted from one department to another or from one position to the higher position with more benefits and greater responsibility based on efficiency and experience.

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Upgrading and Demotions: Others are upgrading and demotion of present employees according to their performance. Retired and Retrenched employees: These employees may also be recruited once again in case of shortage of qualified personnel or increase in load of work. Recruitment of such people save time and costs of the organizations as the people are already aware of the organisational culture and the policies and procedures.

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Deceased and Disabled employees: The dependents and relatives of deceased employees and disabled employees are also done by many companies so that the members of the family do not become dependent on the mercy of others.

Merits of Internal Sources

Increase in morale Better selection Economical Reduced labour turnover Better labour management relations

Demerits of Internal Sources

Check on Young Blood Limited choice Encourages favouritism

External Sources
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Press Advertisements: Ads of the vacancy in newspapers and journals are a widely used source of recruitment. The main advantage is that it has a wide reach.

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Educational Institutes: Various management institutes, engineering colleges, medical colleges etc. are a good source of recruiting well qualified executives, engineers, medical staff etc. they provide facilities for campus interviews and placements. This source is known as campus placement.

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Placement Agencies: Several private consultancy firms perform recruitment functions on behalf of client companies by charging a fee. These agencies are particularly suitable for recruitment of executives and specialists. It is known as Recruitment Process Outsourcing (RPO). Employment Agencies: Government establishes public employment exchanges throughout the country. These exchanges provide job information to job seekers and help employers in identifying suitable candidates.

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Employment Agencies
Types of Employment Agencies

Government Employment Exchanges

Nonprofit Agencies

Private Agencies

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Labour Contractors: Manual workers can be recruited through contractors who maintain close contacts with the sources of such workers. This source is used to recruit labour for construction jobs. Unsolicited Applicants: Many job seekers visit the office of well-known companies on their own. Such callers can help in creating the talent pool or the database of the probable candidates for the organisation.

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Employee Referrals: Many organizations have structured system where the current employees of the organisation can refer their friends and relatives for some position in their organisation. In some organisations these are formal agreements to give priority in recruitment to the candidates recommended by the trade union. Recruitment at Factory Gates : Unskilled workers may be recruited at the factory gate these may be employed whenever a permanent worker is absent. More efficient among these may be recruited to fill permanent vacancies.

Merits of External Recruitment

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Entry of young blood. Wide choice Less chances of favouritism

Demerits of External Recruitment

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Decrease in Morale of Existing Employees. Chances of wrong selection. Costly source. Increase in labour-turnover. Deterioration in labour-management relationship.

Selection

Selection means selecting capable applicants according to the predetermined number out of a large number of applicants through different tests. Selection procedure starts when recruitment gets completed. The basic purpose of selection process is to choose the right type of candidates for various positions in the organisation.

Definition of Selection

Acc. To Dale Yoder, Selection is the process in which candidates for employment are divided into two classes- those who are to be offered employment and those who are not. Weihrich and Koontz defines selection as, Selecting a manager is choosing from among the candidates the one who best meets the position requirements.

Selection Process
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Preliminary Interview Receiving Application blank Screening of Applications Written Tests Employment Interview Checking References Medical Examination Final Interview Appointment Letter

Preliminary Interview

It is used to eliminate those candidates who do not meet the minimum eligibility criteria laid down by the organization. The skills, academic and family background, competencies and interests of the candidate are examined during preliminary interview. Preliminary interviews are less formalized and planned than the final interviews. The candidates are given a brief up about the company and the job profile; and it is also examined how much the candidate knows about the company. Preliminary interviews are also called screening interviews.

Receiving Application blank

The candidates who clear the preliminary interview are required to fill application blank. It contains data record of the candidates such as details about age, qualifications, reason for leaving previous job, experience, etc.

Screening of Applications

Once the application blanks are received, these are screened by a screening committee and a list is prepared of the candidates to be interviewed. Applications may be called for interview on some specific criteria like sex, desired age group, experience and qualifications. Normally 5 to 7 candidates are called for written test. The screened applications are then reviewed by the Personnel Manager and call letters for written test are dispatched by registered post.

Written Tests

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To know the level of the candidates ability and the knowledge, the pattern of his interests and aptitudes in detail various written tests are conducted as below: Aptitude test Intelligence test Reasoning test Personality test Interest test Performance test, etc.

Employment Interview

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It is a one to one interaction between the interviewer and the potential candidate. It is used to find whether the candidate is best suited for the required job or not. The main purposes of an employment interview are: To find out the suitability of the candidate. To seek more information about the candidate. To give him an accurate picture of the job with details of terms and conditions and some idea of organization's policies.

Checking References

Before the final selection, the prospective employer normally makes an investigation on the references supplied by the applicant and undertakes more or less a thorough search into the candidates past employment, his behaviour, skills, conduct, education, personal reputation, financial condition, police record, etc.

Medical Examination

Medical tests are conducted to ensure physical fitness of the potential employee. It will decrease chances of employee absenteeism, the rates of accidents and labour turnover.

Final Interview

Before making a job offer, the candidates may be subjected to one more oral interview to find out their interest in the job and their expectations.

Appointment Letter

A candidate who clears all the steps is finally considered right for a particular job and is presented with the appointment letter and is requested to join the organisation within a specified period.

Recruitment versus Selection

Recruitment Selection

It is the process of searching It is the process of selection of candidates for vacant jobs and right types of candidates and making them apply for the offering them jobs. same.
It is a positive approach It is a negative approach

Its aim is to attract more and Its aim is to reject unsuitable more candidates for vacant candidates and pick up the jobs. most suitable people for the vacant jobs. It precedes selection Less time is required It is an economical method. It follows recruitment More time is required It is an expensive method.

Recruitment

Selection

It is a simple process and It is complicated process and normally does not require normally experts are required help from experts. to conduct tests and interview. It is done by the personnel It is done by the department department. concerned or by the top department. No contractual relationships It results in a contract of are established between the service between the employer employer and the candidates. and the selected employee.

Types of Written Tests

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Aptitude test Intelligence test Reasoning test Personality test

Aptitude test

Aptitude and ability tests are designed to assess your logical reasoning or thinking performance. They consist of multiple choice questions and are administered under exam conditions. They are strictly timed and a typical test might allow 30 minutes for 30 or so questions.

Intelligence test

This simple test has been used for over 50 years and has tested reasoning and intelligence with great accuracy. It attempts to measure the intelligence that is, basic ability to understand the things happening around, assimilate its functioning, and apply this knowledge to enhance the quality of your work.

Reasoning test

The act or process of drawing conclusions from facts, evidence, etc. is called reasoning. Through this test the companies try to find out the analytical ability in a candidates. They try to find out whether the candidate will be able to use reasons, especially to form conclusions, inferences, or judgments.

Personality test

It attempts to measure your basic personality style and are most used in research. Personality tests typically measure one or more of five personality dimensions:
Extroversion, Emotional stability, Agreeableness, Conscientiousness and Openness to experience.

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Interest test

Psychological tests designed to clarify an individual's vocational potential or to compare an individual's performance with the average scores of a specific population. These tests are designed to find out the interests of an individual candidates.

Performance tests

It is a performance test of whether a person is able to perform the functions of a competent employee or not. Through this test companies try to check out whether the candidate will be able to do the job or not.

LIST OF ACTIVITIES UNDER HUMAN RESOURCE MANAGEMENT

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Manpower Planning Recruitment Selection Placement Induction or Orientation Training Performance Appraisal Wage and Salary Administration Collective Bargaining Industrial Disputes Industrial Relations Promotion and Transfer