Table of Contents

Preface .........................................................................................iii
Chapter 1: Overview of HRM ..............................................................................1
1.1
1.2

1.3
1.4
1.5
1.6

Introduction ............................................................................................................................... 2
Concept of HRM ....................................................................................................................... 2
1.2.1
Definitions of HRM ..................................................................................................... 3
1.2.2

Objectives of HRM ...................................................................................................... 3

1.2.3

Scope of HRM ............................................................................................................. 4

1.2.4

Policies of HRM ........................................................................................................... 4

1.2.5

Functions of HRM ....................................................................................................... 5

1.2.6

Limitations of HRM ..................................................................................................... 6

Careers in HRM ........................................................................................................................ 7

Summary .................................................................................................................................... 8
Key Terms ................................................................................................................................. 8
Exercises ..................................................................................................................................... 9
Multiple Choice Questions ......................................................................................................... 9
Short Answer Type Questions ................................................................................................. 11
Long Answer Type Questions .................................................................................................. 13

Chapter 2: Human Resource Planning ................................................................ 15

2.1
2.2

2.3
2.4
2.5
2.6

Introduction ............................................................................................................................. 16
Concept of HRP....................................................................................................................... 16
2.2.1
Features of HRP ......................................................................................................... 16
2.2.2

Process of HRP........................................................................................................... 18

2.2.3

Methods used for HRP ............................................................................................... 23

2.2.4

Difficulties in HRP ..................................................................................................... 31

2.2.5

Pre-Requisites for Successful HRP ............................................................................. 32

Integrating HRP into Strategic Planning ................................................................................. 33

Summary .................................................................................................................................. 35
Key Terms ............................................................................................................................... 35
Exercises ................................................................................................................................... 36
Multiple Choice Questions ....................................................................................................... 36
Short Answer Type Questions ................................................................................................. 38
Long Answer Type Questions .................................................................................................. 41

Chapter 3: Job Analysis, Job Description, Job Specification, and Job Evaluation ...... 45
3.1
3.2

Introduction ............................................................................................................................. 46
Job Analysis .............................................................................................................................. 46

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3.3

3.4

3.5

3.6
3.7
3.8

3.2.1

Definitions of Job Analysis .......................................................................................... 47

3.2.2

Objectives of Job Analysis .......................................................................................... 47

3.2.3

Uses of Job Analysis .................................................................................................... 48

3.2.4

Steps in Job Analysis ................................................................................................... 49

3.2.5

Techniques for Collecting the Job Analysis Data ....................................................... 51

Job Description......................................................................................................................... 55
3.3.1
Definition of Job Description...................................................................................... 55
3.3.2

Purpose of Job Description ......................................................................................... 55

3.3.3

Limitations of Job Description.................................................................................... 57

3.3.4

Guidelines for Writing an Effective Job Description .................................................. 57

Job Specification....................................................................................................................... 59
3.4.1
Definition of Job Specification.................................................................................... 59
3.4.2

Purpose of Job Specification ....................................................................................... 60

3.4.3

Guidelines for Preparing Job Specification ................................................................. 60

3.4.4

Job Design .................................................................................................................. 61

Job Evaluation .......................................................................................................................... 66

3.5.1
Definitions of Job Evaluation...................................................................................... 66
3.5.2

Objectives of Job Evaluation ...................................................................................... 66

3.5.3

Procedure of Job Evaluation....................................................................................... 67

3.5.4

Limitations of Job Evaluation ..................................................................................... 68

3.5.5

Methods of Job Evaluation ......................................................................................... 69

Summary .................................................................................................................................. 76
Key Terms ............................................................................................................................... 76
Exercises ................................................................................................................................... 77
Multiple Choice Questions ....................................................................................................... 77
Short Answer Type Questions ................................................................................................. 79
Long Answer Type Questions .................................................................................................. 85

Chapter 4: Acquisition of Human Resource ......................................................... 91

4.1
4.2

4.3

4.4

Introduction ............................................................................................................................. 92
Recruitment ............................................................................................................................. 92
4.2.1
Definition of Recruitment .......................................................................................... 92
4.2.2

Objectives of Recruitment .......................................................................................... 93

4.2.3

Types of Recruitment ................................................................................................. 93

4.2.4

Process of Recruitment ............................................................................................... 93

4.2.5

Sources of Recruitment .............................................................................................. 98

4.2.6

Recruitment Policies................................................................................................. 104

4.2.7

Strategic Issues in Recruitment ................................................................................ 106

4.2.8

Equal Employment Opportunity (EEO)................................................................... 107

Selection ................................................................................................................................. 108

4.3.1
Definition of Selection .............................................................................................. 108
4.3.2

Process of Selection .................................................................................................. 109

4.3.3

Techniques of Selection............................................................................................ 116

Induction and Orientation ..................................................................................................... 123

4.4.1
Definition of Induction ............................................................................................. 123
4.4.2

Purpose of Induction and Orientation...................................................................... 123

4.4.3

Induction and Orientation Program ........................................................................ 123

4.4.4

Requisites of an Effective Induction and Orientation Program ................................ 125

Table of Contents vii

4.5
4.6
4.7
4.8

Placement ............................................................................................................................... 126

Summary ................................................................................................................................ 127
Key Terms ............................................................................................................................. 128
Exercises ................................................................................................................................. 128
Multiple Choice Questions ..................................................................................................... 128
Short Answer Type Questions ............................................................................................... 130
Long Answer Type Questions ................................................................................................ 134

Chapter 5: Training and Development ............................................................. 137

5.1
5.2

5.3

5.4
5.5
5.6

Introduction ........................................................................................................................... 138

Training of Human Resource ................................................................................................ 138
5.2.1
Definition of Training .............................................................................................. 138
5.2.2

Nature of Training ................................................................................................... 138

5.2.3

Importance of Training ............................................................................................ 139

5.2.4

Methods of Training ................................................................................................ 139

5.2.5

Process of Training ................................................................................................... 145

5.2.6

Role of a Trainer ...................................................................................................... 152

Development of Human Resource ......................................................................................... 153

5.3.1
Defining Human Resource Development ................................................................ 154
5.3.2

Objectives of Development of Human Resource ..................................................... 154

5.3.3

Human Resource Development Mechanism ........................................................... 155

5.3.4

Human Resource Development for Organizational Effectiveness ........................... 155

Summary ................................................................................................................................ 156

Key Terms ............................................................................................................................. 156
Exercises ................................................................................................................................. 157
Multiple Choice Questions ..................................................................................................... 157
Short Answer Type Questions ............................................................................................... 159
Long Answer Type Questions ................................................................................................ 162

Chapter 6: Performance Appraisal ................................................................... 167

6.1
6.2

6.3

Introduction ........................................................................................................................... 168

Concept of Performance Appraisal ........................................................................................ 168
6.2.1
Defining Performance Appraisal .............................................................................. 168
6.2.2

Objectives of Performance Appraisal ....................................................................... 168

6.2.3

Performance Appraisal Process ................................................................................ 169

6.2.4

Methods of Performance Appraisal .......................................................................... 171

6.2.5

Benefits of Performance Appraisal ........................................................................... 177

6.2.6

New Trends in Performance Appraisal .................................................................... 178

Concept of Potential Appraisal............................................................................................... 179

6.3.1
Defining Potential Appraisal .................................................................................... 179
6.3.2

6.4
6.5
6.6
6.7
6.8

Features of Potential Appraisal ................................................................................. 179

Performance Vs Potential Appraisal....................................................................................... 179

Challenges Faced in Performance Appraisal .......................................................................... 179
Summary ................................................................................................................................ 181
Key Terms ............................................................................................................................. 181
Exercises ................................................................................................................................. 181
Multiple Choice Questions ..................................................................................................... 181
Short Answer Type Questions ............................................................................................... 183
Long Answer Type Questions ................................................................................................ 187

viii Table of Contents

Chapter 7: Change Management...................................................................... 195
7.1
7.2

7.3
7.4

Introduction ........................................................................................................................... 196

Concept of Change ................................................................................................................ 196
7.2.1
Scope of Change ...................................................................................................... 196
7.2.2

Drivers of Change .................................................................................................... 197

7.2.3

Models of Change .................................................................................................... 197

7.2.4

Principles of Change................................................................................................. 197

7.2.5

Process of Change .................................................................................................... 198

7.2.6

Types of Change ...................................................................................................... 198

Change Management ............................................................................................................. 199

Challenges Faced During Change Management ................................................................... 200
7.4.1
Individual Challenges ............................................................................................... 200
7.4.2

7.5
7.6
7.7
7.8
7.9

Organizational Challenges ....................................................................................... 201

Change Management Failure................................................................................................. 201

Interventions in Managing Change ........................................................................................ 201
Summary ................................................................................................................................ 204
Key Terms ............................................................................................................................. 204
Exercises ................................................................................................................................. 204
Multiple Choice Questions ..................................................................................................... 204
Short Answer Type Questions ............................................................................................... 206
Long Answer Type Questions ................................................................................................ 208

Chapter 8: Career and Succession Planning ...................................................... 211

8.1
8.2

8.3
8.4

8.5
8.6

Introduction ........................................................................................................................... 212

Concept of Career .................................................................................................................. 212
8.2.1
Definition of Career ................................................................................................. 212
8.2.2

Features of Career .................................................................................................... 212

8.2.3

Career Anchors ........................................................................................................ 213

Career Stages ......................................................................................................................... 214

Career Planning ..................................................................................................................... 215
8.4.1
Definition of Career Planning .................................................................................. 215
8.4.2

Features of Career Planning ..................................................................................... 216

8.4.3

Objectives of Career Planning .................................................................................. 216

8.4.4

Process of Career Planning ....................................................................................... 216

8.4.5

Benefits of Career Planning ...................................................................................... 217

8.4.6

Problems in Career Planning ................................................................................... 217

8.4.7

Career Planning vs. Human Resource Planning ...................................................... 218

Role of Psychometric Testing in Career Planning ................................................................. 218

Succession Planning ............................................................................................................... 219
8.6.1
Features of Succession Planning ............................................................................... 219
8.6.2

8.7
8.8
8.9
8.10

Scope of Succession Planning ................................................................................... 220

Careers Planning Vs. Succession Planning............................................................................. 220

Summary ................................................................................................................................ 221
Key Terms ............................................................................................................................. 221
Exercises ................................................................................................................................. 222
Multiple Choice Questons ...................................................................................................... 222
Short Answer Type Questions ............................................................................................... 223
Long Answer Type Questions ................................................................................................ 227

Table of Contents ix
Chapter 9: Maintenance of Human Resource .................................................... 229
9.1
9.2
9.3

9.4
9.5
9.6

Introduction ........................................................................................................................... 230

Defining Human Resource Maintenance .............................................................................. 230
Maintenance Methods ........................................................................................................... 230
9.3.1
Human Resource Audit ........................................................................................... 231
9.3.2

Encouraging Good Performance .............................................................................. 233

9.3.3

Quality of Work Life ................................................................................................ 239

Summary ................................................................................................................................ 250

Key Terms ............................................................................................................................. 250
Exercises ................................................................................................................................. 251
Multiple Choice Questions ..................................................................................................... 251
Short Answer Type Questions ............................................................................................... 253
Long Answer Type Questions ................................................................................................ 256

Chapter 10: Compensation Management ........................................................... 259

10.1
10.2
10.3

Introduction ........................................................................................................................... 260

Concept of Compensation...................................................................................................... 260
Job Evaluation and Compensation......................................................................................... 260
10.3.1 Pre-Requisites for Effective Job Evaluation .............................................................. 261
10.3.2 Objectives of Job Evaluation .................................................................................... 261
10.3.3 Significance of Job Evaluation .................................................................................. 262

10.4

Concepts of Wages, Salaries, and Fringe Benefits ................................................................. 262

10.4.1 Wage ........................................................................................................................ 262
10.4.2 Salary ....................................................................................................................... 264
10.4.3 Fringe Benefits .......................................................................................................... 265

10.5
10.6
10.7
10.8

A New Trend in Compensation - Employee Stock Options .................................................. 265

Summary ................................................................................................................................ 268
Key Terms ............................................................................................................................. 268
Exercises ................................................................................................................................. 268
Multiple Choice Questions ..................................................................................................... 268
Short Answers Type Questions .............................................................................................. 270
Long Answer Type Questions ................................................................................................ 273

Chapter 11: Latest Trends in Human Resource Management ............................... 275

11.1
11.2

Introduction .......................................................................................................................... 276

Human Resource Information Systems ................................................................................ 276
11.2.1 Objectives of Human Resource Information System ............................................... 277
11.2.2 Designing Human Resource Information System .................................................... 277
11.2.3 Benefits of Human Resource Information Systems .................................................. 278

11.3

Total Quality Management................................................................................................... 278

11.3.1 Need of Total Quality Management ........................................................................ 279
11.3.2 Benefits of Total Quality Management .................................................................... 279
11.3.3 Implementation of TQM ......................................................................................... 279

11.4
11.5

Kaizen A Continuous Improvement Philosophy................................................................ 279

Quality Circles ...................................................................................................................... 280
11.5.1 Benefits of Quality Circles ........................................................................................ 280
11.5.2 Limitations of a Quality Circle ................................................................................. 281

11.6
11.7

Collective Bargaining ............................................................................................................ 281

International Human Resource Management ...................................................................... 281

x Table of Contents
11.7.1 Types of International Organizations....................................................................... 282
11.7.2 Differences between International and Domestic Human
Resource Management............................................................................................. 282
11.7.3 International Human Resource Management Practices .......................................... 283
11.8

Knowledge Management ...................................................................................................... 285

11.8.1 Need for Knowledge Management .......................................................................... 286
11.8.2 Managing the Flow of Knowledge ........................................................................... 286
11.8.3 Knowledge Management in Multinational Companies ........................................... 286

11.9 Summary ................................................................................................................................ 287

11.10 Key Terms ............................................................................................................................. 287
11.11 Exercises ................................................................................................................................. 288
Multiple Choice Questions ..................................................................................................... 288
Short Answer Type Questions ............................................................................................... 290
Long Answer type Questions.................................................................................................. 292

Index ........................................................................................... 297