Human Resource Management

Human resource has two meaning depending on the context. In terms of businesses and corporation, it refers the individuals of the firm and to the portion of the firm that deals with the hiring, firing, training and other personal issues. In terms of political economy and economics, it was termed as labor, one of the three factors of production. The objective of human resource is to maximize the return on investing the organizations human capital. Human resource management aims to attain individual employee's intention and also simultaneously improve their contribution to the firm.

In general, human resource deals with two different worlds:

  • Non-Unionized- Management has the entire control
  • Unionized - Management and the union share the control, they both satisfy the employee's requirement with respect to the terms and conditions of the employment.

Human resource management serves the following key functions:

  • Hiring
  • Compensation
  • Evaluation and management
  • Promotions
  • Managing relations
  • Planning

All these key functions are conducted effectively by the firm's Human resource manager in a legal, fair and consistent manner.

Human resource development

In terms of recruitment and selection, it is essential to carry out a entire job analysis to determine the level of skills, technical abilities, competencies and flexibility of the employees. At this point it is also necessary to consider the internal and external factors. External factors are those which include issues such as current and future trend of the labor market. Internal factors include management style and organization culture.

The three major trends that have to be considered to know the firm's business environment are:

  • Demographics
  • Diversity
  • Skills and qualification

In order to know how the individuals respond to the changes in the labor market the following has to be considered

  • Geographic spread
  • Occupational structure
  • Generational difference

Job recruitment methods can be made through Consultants, local newspapers, employment agencies etc. It is very essential to choose a right media to make sure that there is a good response for the advertised post. Recruitment methods are wide and varied the role of the job should be explained very clearly

Harvard map of HRM

The Harvard map outlines four HR policies

  • Human resource flows
  • Reward systems
  • Employee influence
  • Work systems

Functions of HRM

Human resource management is the logic of getting things done through people. People are our most valuable asset is the formula that all senior management team should accept. But still people in the many organization remain

  • Under valued
  • Under trained
  • Poorly motivated
  • Perform well below their actual capability

The final goal of the function is to make sure that the business is addressed correctly by the right staff with the relevant skill sets, that is neither over staffed nor understaffed.

Function 1: Manpower Planning

Planning staff levels needs assessment of present and future needs compared with the resources available at present and with the future calculated resources, which leads to recruitment of employees, training etc.

Function 2: Recruitment and selection of employees

The main sources are

  • Internal promotion and introduction
  • Career officers
  • News paper advertising
  • Consultants and agents

The selection testing includes

  • Aptitude
  • Attainments
  • General intelligence

In some of the senior most positions the tests involved includes

  • Leadership groups
  • Command exercise
  • Group problem solving

Function 3: Employee motivation and evaluation

To retain the good staffs and to motivate them to a good extent, it is necessary to consider the financial and psychological rewards offered by the organization.

An organization stock of the work force and their performance should be maintained constantly for three reasons

  • To identify potential
  • To improve organizational performance
  • To provide reasonable method linking payment to performance

Function 4: Industrial relations

Two types of rules are involved: Substantive, determining the conditions of service, what rewards workers should receive Procedural, determining how workers should be treated and procedures.

Function 5: Provision of employee services

The activities involved are

  • Care for welfare aspects of health
  • Scheme for occupational sick pay and other special leaves
  • Provision of financial support and guidance
  • Provision of canteen, catering facilities and information handbooks

Function 6: Employee education, training and development

Education is the mind preparation which is performed in a distant area from the work place, training is the development of skills and attitude to perform the given job in a nice way and development is the growth of individual.

Inside an organization all the above are necessary in order to

  • Develop workers to take up higher tasks
  • Raise efficiency and standards of performance
  • Meet legislative requirements

Developing a HRM strategy

To develop a more focused and logical approach to manage people, an organization needs to develop a human resource strategy. Seven steps are involved in developing HR strategy:

  • Getting the big picture
  • Developing a mission statement
  • Conducting a SWOT analysis of the organization
  • Conducting a thorough HR analysis
  • Determining critical people issues
  • Developing consequences and solutions
  • Implementing the action plans

Emerging trends in managing Human Resources

Recently companies are striving to enhance the quality of work life and personal life of the employees. This does not end with the employees; it also expands to their family. In-house health clubs, yoga and meditation, day care centers, employee's get together with their families and many facilities like these are provided by the organizations as part of employee welfare. Today no job can be done solely and it involves a team. The companies are now designing the rewards in response to the performance of the team in addition to the individual performance. Changes that work today may not work tomorrow. Customer expectations, market changes and strategic decisions will derive the tools to managing human assets.


The HRM function and HRD line of work has undergone a remarkable change over the past 30 years. Earlier in most of the organizations the personnel department was responsible for paperwork, hiring and paying people. But now the HR department has taken a major role in handling these functions. In a number of growing organizations HR is viewed as a source of competitive advantage. Strategic human resource may be defined as the linking of human resource and strategic goals to improve the business performance and develop organizational culture. HR management plays an important role in environmental scanning. HR professionals increase the capacity of the business by performing its strategies.