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ANNAMALAI UNIVERSITY
DIRECTORATE OF DISTANCE EDUCATION
M.B.A. Human Resource Management

M.B.A. Marketing Management
M.B.A. Financial Management
First Year
HUMAN RESOURCE MANAGEMENT

LESSONS : 1 24
Copyright Reserved
(For Private Circulation Only)
M.B.A. HUMAN RESOURCE MANAGEMENT
M.B.A. MARKETING MANAGEMENT
M.B.A. FINANCIAL MANAGEMENT
FIRST YEAR

Editorial Board
Members
Dr. R. Rajendran
Dean
Faculty of Arts
Annamalai University
Annamalainagar
Dr. C. Samudhararajkumar Dr. A. Rajamohan

Professor and Head Professor and Head
Dept. of Business Administration Management Wing-DDE
Annamalai University Annamalai University
Annamalainagar Annamalainagar
Internals
Dr. P. Chinnadurai Dr. P. Baskar
Assistant Professor Assistant Professor
Management Wing-DDE Management Wing-DDE
Annamalai University Annamalai University
Annamalainagar Annamalainagar
Externals
Dr. R. Jayabal Dr. B. Rajasekaran

Professor & Head Professor and Head
Department of Bank Management Dept. of Business Administration
Alagappa University M.S. University
Karaikudi Tirunelveli
Lesson Writers
Units : I - III Units. : IV - IV
Dr. M. Jeyakumaran Dr. P.G.Arul
Assistant professor Assistant professor
Department of Business Administration Department of International Business
Annamalai University Pondicherry University
Annamalainagar Puducherry
FIRST YEAR

SYLLABUS
Objective
The objective of this subject is to teach the basic principles of human resource
management, how an organization acquires, rewards, motivates, uses, and
manages its employees effectively. In addition, it provides a legal and conceptual
framework for managers, techniques for evaluating performance, structuring teams,
coaching and mentoring people in todays increasingly complex workplace.
UNITI
Human Resource Management: Meaning Nature Scope Objectives
Importance - HRM and HRD Problems of HRM.
Functions of HRM Managerial Functions and Operative functions
Organisation of HRM Department Qualities and Qualification of HR Managers
HR Policies - Environmental influences of HRM HRM Challenges HRM
Strategies.
UNITII
Human Resource Planning, Recruitment and Selection : Human Resource
Planning Meaning Need and Importance Objectives Problems Process
Recruitment:- Meaning Factors Influencing Recruitment Recruitment Policy
Problems in Recruitment Sources of Recruitment.
Selection Meaning Objectives Importance Selection Policy Steps in
Selection Process. Tests - Types Uses. Interview Types Limitations - Guidelines
for Effective interview Placement.
UNITIII
Job Analysis and Evaluation: Job Analysis Meaning of Job and Job Analysis
Purpose Uses Contents Steps in Job Analysis Techniques of Job Analysis
Job Description- Job Specification.
Job Evaluation: Meaning Objectives Procedure Uses Limitations Job
Evaluation Methods : Ranking Method, Grading Method, Point System, Factor
Comparison Method, Market Pricing Method, Job Pricing Methods Essentials of
Job Evaluation. Job Design Meaning Approaches to Designing Jobs Guidelines
for Job Designing Techniques for Designing Jobs: Simplification, Job
Enlargement, Job Rotation and Job Enrichment.
UNITIV
Human Resource Development: Meaning Education - Training - Development
- Training Vs Development Training: Need and Importance Objectives Types
Inputs to Training Training Needs Assessment Organisation of Training
Programmes Steps in Training Programme Evaluation of Training Programmes -
Techniques of Training and Development: On theJob Training Methods - Off-the
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Job Training Methods Management Development Programmes Essentials of
Management Development Programmes - Training and Development in India-
Training Institutes Government Policy.
UNITV
Transfer, Promotion, Discipline and Compensation: Transfer Objectives
Transfer Policy Types of Transfer - Promotion Purpose Promotion policy
Types of Promotion - Demotion. Discipline Meaning Positive and Negative
Aspects of Discipline Causes of Indiscipline - Disciplinary Procedure
Maintaining Discipline. Compensation: Objectives of Compensation Functions
Principles Factors Influencing Wage and Salary Administration Executive
Compensation Plans. Benefits and Employee Services Fringe Benefits Coverage
of Fringe Benefits Employee Services. Knowledge creation and Management
Virtual Organization Emerging HR Trend
UNITVI
Performance Appraisal : Performance Appraisal Meaning Need and
Importance Objectives Problems in Performance Appraisal - Factors Influencing
Performance Appraisal Techniques of Performance Appraisal : Traditional
Techniques Modern Techniques.
Quality of Working Life : Meaning Issues in Quality of Working Life
Measuring Quality of Working Life Obstacles to Quality of Working Life
Programmes Quality Circles Techniques Effective Quality Circles
Empowering Employees.
Development in HRM: e-HRM HR outsourcing e-HR Activities- e-
Recruitment e-Selection e-Training e-Performance Management 360o and
720o Performance Appraisal e-Compensation Data Envelop Methods.
REFERENCES BOOKS
1. Ashwathapph. K, Human Resource Management, Tata McGraw Hill,
New Delhi, 2013.
2. Gupta C.B, Human Resource Management, Sultan Chaud and Sons,
New Delhi, 2009.
3. Flippo, E.B., Personnel Management, McGraw Hill, Kogahusha, 1980.
4. Memoria, C.B., Personnel Management, Himalaya Publishing House, 2003.
5. S.S Khanka, Human Resource Management, S. Chand, Chennai, 2009.
6. P.N. Subramani and G. Rajendra, Human Resource Management and
Industrial Relation, First Edition, Himalaya Publishing House, 2001.
7. Dr.P. Subba Rao, Human Resource Management in the New Millennium,
Himalaya Publishing House, 2000.
8. Dr.P.K.S. Menon, Human Resource Management and Organizational
Behaviour, First Edition, Himalaya Publishing House, 2005.
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JOURNALS AND MAGAZINES
1. Human Resource Management Journal
2. International Journal of Human Resource Studies
3. Kalaniya Journal of Human Resource Management
4. Journal of Human Resources Management Research
5. South Asian Journal of Human Resource Management.
WEB RESOURCES
1. hr.blr.com
2. www.humanresources.org
3. www.hrmguide.net
4. www.humanresourcesiq.com
5. www.humanresourcemanagement.co.uk
6. www.hrmasia.com
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FIRST YEAR

CONTENTS
Lesson Page
Title
No. No.
Unit - I : Human Resource Management
1 Introduction to Human Resource Management 1
2 Functions of HRM 11
3 Organization of HRM Department 19
4 HR Policy 27
Unit - II : Human Resource Planning, Recruitment and Selection
5 Human Resource Planning 37
6 Recruitment 50
7 Selection 61
8 Interview 72
Unit - III : Job Analysis and Evaluation
9 Job Analysis 80
10 Job Description and Job Specification 91
11 Job Evaluation 97
12 Job Design 104
Unit - IV : Human Resource Development
13 Human Resource Development 114
14 Training 121
15 Methods of Training 134
16 Management Development Programmes 148
Unit V : Transfer, Promotion, Discipline and Compensation
17 Transfer and Promotion 156
18 Discipline 165
19 Compensation 174
20 Executive Compensation 182
Unit - VI : Performance Appraisal
21 Introduction Performance Appraisal 190
22 Techniques of Performance Appraisal 206
23 Quality of Work Life 213
24 Development in HRM 225
UNIT - I : HUMAN RESOURCE MANAGEMENT
LESSON 1
INTRODUCTION TO HUMAN RESOURCE MANAGEMENT
1.1 INTRODUCTION
Human resource management (HRM) is the process of employing people,
training them, compensating them, developing policies relating to them, and
developing strategies to retain them. As a field, HRM has undergone many changes
over the last twenty years, giving it an even more important role in todays
organizations. In the past, HRM meant processing payroll, sending birthday gifts to
employees, arranging company outings, and making sure forms were filled out
correctlyin other words, more of an administrative role rather than a strategic role
crucial to the success of the organization. Jack Welch, former CEO of General
Electric and management guru, sums up the new role of HRM: Get out of the
parties and birthdays and enrollment forms. Remember, HR is important in good
times, HR is defined in hard times. Its necessary to point out here, at the very
beginning of this text, that every manager has some role relating to human
resource management. Just because we do not have the title of HR manager doesnt
mean we wont perform all or at least some of the HRM tasks. For example, most
managers deal with compensation, motivation, and retention of employees
making these aspects not only part of HRM but also part of management. As a
result, this material is equally important to someone who wants to be an HR
manager and to someone who will manage a business.
1.2 OBJECTIVES
After reading this lesson, you should be able to,
Understand the role of HRM in organizations.
Define and confer some of the major HRM activities.
Every organization, large or small, uses a variety of capital to make the
business work. Capital includes cash, valuables, or goods used to generate income
for a business. For example, a retail store uses registers and inventory, while a
consulting firm may have proprietary software or buildings. No matter the industry,
all companies have one thing in common: they must have people to make their
capital work for them. This will be our focus throughout the text: generation of
revenue through the use of peoples skills and abilities.
1.3 CONTENTS
1.3.1 Meaning of Human Resource Management
1.3.2 Nature and Scope of Human Resource Management
1.3.3 Objectives of Human Resource Management
1.3.4 Importance of HRM and HRD
1.3.1 Meaning of Human Resource Management
Human Resource Management Day to Day
You have just been hired to work in the human resource department of a small
company. You heard about the job through a conference you attended, put on by
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the Society for Human Resource Management (SHRM). Previously, the owner of the
company, Jennifer, had been doing everything related to human resource
management (HRM). You can tell she is a bit critical about paying a good salary for
something she was able to juggle all on her own. On your first day, you meet the
ten employees and spend several hours with the company owner, hoping to get a
handle on which human resource processes are already set up. Shortly after the
meeting begins, you see she has a completely different perspective of what HRM is,
and you realize it will be your job to educate her on the value of a human resource
manager. You look at it as a personal challenge both to educate her and also to
show her the value of this role in the organization. First, you tell her that HRM is a
strategic process having to do with the staffing, compensation, retention, training,
and employment law and policies side of the business. In other words, your job as
human resources (HR) manager will be not only to write policy and procedures and
to hire people (the administrative role) but also to use strategic plans to ensure the
right people are hired and trained for the right job at the right time. For example,
you ask her if she knows what the revenue will be in six months, and Jennifer
answers, Of course. We expect it to inc rease by 20 percent. You ask, Have you
thought about how many people you will need due to this increase? Jennifer looks
a bit sheepish and says, No, I guess I havent gotten that far. Then you ask her
about the training programs the company offers, the software used to allow
employees to access pay information online, and the compensation policies. She
responds, It looks like we have some work to do. I didnt know that human
resources involved all of that. You smile at her and start discussing some of the
specifics of the business, so you can get started right away writing the strategic
human resource management plan.
1.3.2 Nature and Scope of Human Resource Management
Nature of HRM
HRM is a management function that helps managers to recruit, select, train
and develop members for an organization. HRM is concerned with peoples
dimension in organizations.
The following constitute the core of HRM
1. HRM Involves the Application of Management Functions and
Principles. The functions and principles are applied to acquiring, developing,
maintaining and providing remuneration to employees in organization.
2. Decision Relating to Employees must be integrated. Decisions on
different aspects of employees must be consistent with other human resource (HR)
decisions.
3. Decisions Made Influence the Effectiveness of an Organization.
Effectiveness of an organization will result in betterment of services to customers in
the form of high quality products supplied at reasonable costs.
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4. HRM Functions are not confined to Business Establishments Only but
applicable to non-business organizations such as education, health care, recreation
and like.
HRM refers to a set of programmes, functions and activities designed and
carried out in order to maximize both employee as well as organizational
effectiveness.
SCOPE OF HUMAN RESOURCE MANAGEMENT
The scope of HRM is indeed vast. All major activities in the working life of a
worker from the time of his or her entry into an organization until he or she leaves
the organizations comes under the purview of HRM. The major HRM activities
include HR planning, job analysis, job design, employee hiring, employee and
executive remuneration, employee motivation, employee maintenance, industrial
relations and prospects of HRM.
The scope of Human Resources Management extends to:
All the decisions, strategies, factors, principles, operations, practices,
functions, activities and methods related to the management of people as
employees in any type of organization.
All the dimensions related to people in their employment relationships, and all
the dynamics that flow from it.
The scope of HRM is really vast. All major activities n the working life of a
worker from the time of his or her entry into an organization until he or she leaves
it comes under the purview of HRM. American Society for Training and
Development (ASTD) conducted fairly an exhaustive study in this field and
identified nine broad areas of activities of HRM.
These are given below:
Human Resource Planning
Design of the Organization and Job
Selection and Staffing
Training and Development
Organizational Development
Compensation and Benefits
Employee Assistance
Union/Labour Relations
Personnel Research and Information System
a) Human Resource Planning: The objective of HR Planning is to ensure that
the organization has the right types of persons at the right time at the right place. It
prepares human resources inventory with a view to assess present and future
needs, availability and possible shortages in human resource. Thereupon, HR
Planning forecast demand and supplies and identify sources of selection. HR
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Planning develops strategies both long-term and short-term, to meet the man-power
requirement.
b) Design of Organization and Job: This is the task of laying down
organization structure, authority, relationship and responsibilities. This will also
mean definition of work contents for each position in the organization. This is done
by job description. Another important step is Job specification. Job specification
identifies the attributes of persons who will be most suitable for each job which is
defined by job description.
c) Selection and Staffing: This is the process of recruitment and selection of
staff. This involves matching people and their expectations with which the job
specifications and career path available within the organization.
d) Training and Development: This involves an organized attempt to find out
training needs of the individuals to meet the knowledge and skill which is needed
not only to perform current job but also to fulfill the future needs of the
organization.
e) Organizational Development: This is an important aspect whereby Synergetic
effect is generated in an organization i.e. healthy interpersonal and inter-group
relationship within the organization.
f) Compensation and Benefits: This is the area of wages and salaries
administration where wages and compensations are fixed scientifically to meet
fairness and equity criteria. In addition labour welfare measures are involved which
include benefits and services.
g) Employee Assistance: Each employee is unique in character, personality,
expectation and temperament. By and large each one of them faces problems every
day. Some are personal some are official. In their case he or she remains worried.
Such worries must be removed to make him or her more productive and happy.
h) Union-Labour Relations: Healthy Industrial and Labour relations are very
important for enhancing peace and productivity in an organization. This is one of
the areas of HRM.
i) Personnel Research and Information System: Knowledge on behavioral
science and industrial psychology throws better insight into the workers
expectations, aspirations and behavior. Advancement of technology of product and
production methods have created working environment which are much different
from the past. Globalization of economy has increased competition many fold.
Science of ergonomics gives better i deas of doing a work more conveniently by an
employee. Thus, continuous research in HR areas is an unavoidable requirement. It
must also take special care for improving exchange of information through effective
communication systems on a continuous basis e specially on moral and motivation.
HRM is a broad concept; personnel management (PM) and Human resource
development (HRD) are a part of HRM.
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1.3.3 Objectives of Human Resource Management
The primary objective of HRM is to ensure the availability of competent and
willing workforce to an organization.
The specific objectives include the following:
1. Human capital: assisting the organization in obtaining the right number and
types of employees to fulfill its strategic and operational goals
2. Developing organizational climate: helping to create a climate in which
employees are encouraged to develop and utilize their skills to the fullest
and to employ the skills and abilities of the workforce efficiently
3. Helping to maintain performance standards and increase productivity
through effective job design; providing adequate orientation, training and
development; providing performance-related feedback; and ensuring effective
two-way communication.
4. Helping to establish and maintain a harmonious employer/employee
relationship
5. Helping to create and maintain a safe and healthy work environment
6. Developing programs to meet the economic, psychological, and social needs
of the employees and helping the organization to retain the productive
employees
7. Ensuring that the organization is in compliance with provincial/territorial
and federal laws affecting the workplace (such as human rights, employment
equity, occupational health and safety, employment standards, and labour
relations legislation). To help the organization to reach its goals
8. To provide organization with well-trained and well-motivated employees
9. To increase the employees satisfaction and self-actualization
10. To develop and maintain the quality of work life
11. To communicate HR policies to all employees.
12. To help maintain ethical polices and behavior.
The above stated HRM objectives can be summarized under four specific objectives:
societal, organizational, and functional and personnel.
1) Societal Objectives: seek to ensure that the organization becomes socially
responsible to the needs and challenges of the society while minimizing the negative
impact of such demands upon the organization. The failure of the organizations to
use their resources for the societys benefit in ethical ways may lead to restriction.
2) Organizational Objectives: it recognizes the role of HRM in bringing about
organizational effectiveness. It makes sure that HRM is not a standalone
department, but rather a means to assist the organization with its primary
objectives. The HR department exists to serve the rest of the organization.
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3) Functional Objectives: is to maintain the departments contribution at a
level appropriate to the organizations needs. Human resources are to be adjusted
to suit the organizations demands. The departments value should not become too
expensive at the cost of the organization it serves.
4) Personnel Objectives: it is to assist employees in achieving their personal
goals, at least as far as these goals enhance the individuals contribution to the
organization. Personal objectives of employees must be met if they are to be
maintained, retained and motivated. Otherwise employee performance and
satisfaction may decline giving rise to employee turnover.
1.3.4 Importance of HRM and HRD
Importance of HRM
Human resource management is the part of the organization that is concerned
with the people dimension (DeCenzo and Robbins, 1996). It is a staff, or support,
junction in the organizations. Its role is to provide assistance in HRM matters to
line employees, or those directly involved in producing the organizations goods and
services. Every organization is comprised of people; acquiring their services,
developing their skills, motivating them to high levels of performance. And ensuring
to maintain their commitment to the organization is essential to achieve
organizational objectives. This is true, regardless of the type of organization;
government, business, education, health, recreation, or social action. Getting and
keeping good people is critical to the success of every organization. HRM is an
approach consisting of four functions; staffing, training, development and
motivation, and four activities; getting people, preparing them, stimulating them,
and keeping them. Today, professionals in the human resource area are vital
elements in the success of any organization.
Their jobs require a new level sophistication that is unprecedented in human
resource management, not surprisingly; their status in the organization has also
been elevated as the name has changed. Companies today recognize the importance
of people in meeting their goals. For instance, at Standard Chartered Bank and
Sony Music Entertainment, people are viewed as how each employee is important
toward the organization achieving its strategic goals. In return, these people have
needs to be met. Consequently, when major decisions affecting the organization and
its people are made by the companys executives, HR ty pically is present to
represent the people-side of the business. Many colleges and universities are also
helping to prepare HRM professionals by offering concentrations and majors in the
discipline. Additionally, there exists an accreditation process for HRM professionals.
The society for Human Resource Management offers opportunities for individuals to
distinguish themselves in the field by achieving a level of proficiency that has been
predetermined by the
Human Resource Certification Institute as necessary for successful handling of
human resource management affairs. Michie and Sheehan -Quinn (2001) surveyed
over 200 manufacturing firms in the UK to investigate the relationship between
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corporate performance and the use of flexible work practices, human resource
systems and industrial relations. They found that 'low-road' practices - including
short-term contracts, lack of employer commitment to job security, low levels of
training and unsophisticated human resource practices - were negatively correlated
with corporate performance.
In contrast, they established a positive correlation between good corpo rate
performance and 'high-road' work practices - 'high-commitment' organizations or
'transformed' workplaces. They also found that HR practices are more likely to
make a contribution to competitive success when introduced as a comprehensive
package, or 'bundle' of practices (Khan, 2011). Kelliher and Riley (2002), highlight
evidence to support the view that the impact of HRM is greatest when it involves a
set of coherent policies and practices, also consider that HR initiatives should be
implemented as part of an integrated package. They instance functional flexibility,
which leads to an intensification of work, but in the cases they studied this was
less of an issue when supported by higher levels of remuneration. Since mid-1990s
progress has been made in conceptualizing the problem and measuring results.
Huang (2000) looked at 315 firms in Taiwan and related their human resource
practices to their organizational performance. Huang's study shows a significant
relationship between performance and the effecti veness of their HR functions,
including planning, staffing, appraisal, compensation, training and development.
Importance of HRD
Departmentation: Responsibility can be broadly classified under the following
three categories. Personnel administration-Keeping records, staffing etc. Industrial
relations-employee assistance, motivation, grievance, redressals, T&D etc. Labour
Relations- Collective bargaining, Union-management, wages, agreement etc.,
Departments are formed by grouping major activities together so as to bring by
functional specialization and delegation of authority. Hence some more groups are
framed out of the above, broad classification and separate departments of
organization, no of employees and their specialization and nature and type
business.
Types of Organization structure: There are three types of Organization
Structures, namely, centralized, decentralized and matrix. Each has its own merits
and demerits. There is nothing like the best form of an organization or ideal
structure, what is the important is to develop an effective organization structure
which is the flexible enough to incorporate necessary modifications in the futures
the situation demands. Centralization is economic and ensures unity of direction
control and org grow in size.
Decentralization, on the other hand, is excellent from which accelerate
manpower development. It promotes delegation of authority and quick decision
making processes especially where organization is quite big in terms of multiple
units and multiproduct and dispersed widely in geographic locations. In
decentralized organization, the philosophy is to push decision-making as far down
as possible. This will assist the organization in two ways: Increases initiative and
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motivation, which in turn result empowerment. Abilities of fast response, which
improve competitive advantages. Matrix type of organizations is an attempt to
desire advantages of the both centralization and decentralization and at the same
time improve the team building of both line and staff managers. Her both line and
staff managers report to the head of department (HOD) administratively. Now as we
all know the Human Resource Management involves basically procurement
function .it treats human being as a resource.
HRM views man not only as economic person but looks at from social and
political point of view also. The Indian economy during last 40 years had been
controlled by the economic policy of the government. The policy was influenced by
political, economical reasons and also the idea of industries growing to meet the
market demands. There were governmental restrictions on licensing, foreign
exchange, import, and encouragement to public sector. These restrictions impaired
the growth of economy results, balance of payments.
And hence it impaired the decline the Indias credit worthiness in the
international market. This resulted in liberalization of governments economic
policy. As a result MRTP and FERA were removed and as a result liberalization of
governments economic policy came into e xistence. It had its effect on monetary,
fiscal, control on inflation, controlling subsidies, restructuring public sector and
exit policy.
Problems of HRM
Human resource managers need many different types of skills. Being able to
organize, multitask, and communicate effectively, as well as having specific
job skills, such as how to run a particular computer program, and a sense of
fairness and ethics, is crucial to a successful career in HRM.
There are many contemporary challenges associated with HRM. First, it is
up to everyone in the organization to contain costs. HR managers need to
look at their individual departments and demonstrate the necessity and
value of their functions to the organization. HR managers can also help
contain costs in several ways, such as managing benefits plans and
compensation and providing training.
The fast-changing nature of technology is also a challenge in HRM. As new
technologies are developed, employees may be able to implement innovative
ways of working such as flextime. HR managers are also responsible for
developing policies dealing with cyber loafing and other workplace time
wasters revolving around technology. Employee stress and lack of work -life
balance are also greatly influenced by technology.
Awareness of the changes in the economy allows the human resource
manager to adequately plan for reductions and additions to the workforce.
The aging and changing workforce is our final factor. As baby boomers
retire, there likely will not be enough people to replace them, and many of
the skills the baby boomers have may be lost. In addition, having to work
with multiple generations at once can create challenges as different
expectations and needs arise from multigenerational workforces.
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1.4 REVISION POINTS
1. Capital includes all resources a company uses to generate revenue. Human
resources or the people working in the organization are the most important
resource.
2. Human resource manage ment is the process of employing people, training
them, compensating them, developing policies re lating to the workplace, and
developing strategies to retain employees.
3. There are seven main responsibilities of HRM managers: staffing, setting
policies, compensation and benefits, retention, training, employment laws,
and worker protection. In this book, each of these major areas will be
included in a chapter or two.
4. In addition to being concerned with the seven internal aspects, HRM
managers must keep up to date with changes in the external environment
that may impact their employees. The trends toward flexible schedules and
telecommuting are examples of external aspects.
5. To effectively understand how the external forces might affect human
resources, it is important for the HR manager to read the HR literature,
attend conferences, and utilize other ways to stay up to date with new laws,
trends, and policies.
1.5 INTEXT QUESTIONS
1. Define Human resource management? What are its functions and
objectives?
2. Elaborate about the nature of HRM and its relevance in the present
scenario.
3. Explain the role of HR manager in an organization.
4. Why HR Policies, programmes and plans are key to an Organizations
success?
5. Argue the difference between Academic study and the practice of HR
management.
1.6 SUMMARY
It is critical that todays organizations align their human resource s to better
meet strategic objectives. A failure to do so results in wasted time, energy, and
resources. Organizations are more likely to achieve this alignment with their
corporate objectives when they review their recruitment and selection processes for
fit, communicate the mission and vision statements, use joint goal setting, design
an appropriate reward system, empower the workforce, promote and develop from
within, and use teams to achieve synergy. Human Resource Management is the
management function that helps the managers to plan, recruit, select, train,
develop, remunerate and maintain members for an organization. HRM has four
objectives of societal, organizational, functional and personal development. An
organization must have set policies; definite procedures and well defined principles
relating to its personnel and these contribute to the effectiveness, continuity and
stability of the organization.
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1.7 TERMINAL EXERCISE
Fill in the blanks:
1. _____________ identifies the attributes of persons who will be most suitable
for each job which is defined by job description.
2. HRM is an approach considering of four functions staffing, training,
____________ and motivation.
3. _____________ promotes delegation of authority and quick decision.
4. _____________ is the process of employing people, training them,
compensating them and developing strategies to retain employees.
5. Definition of work contents for each position in the organization is ______________.
1.8 SUPPLEMENTARY MATERIALS
1. Organizational Behavior - Aswathappa K.
2. Human Resource Management- Rao, J. V.
1.9 ASSIGNMENTS
1. State arguments for and against the following statement: there are other
things more valuable in an organization besides the people who work there.
2. Of the seven tasks an HR manager does, which do you think is the most
challenging? Why?
1.10 SUGGESTED READING /REFERENCE BOOKS/SET BOOKS
1. Aswathappa. K. (2008), Human Resource and Personnel Management (5th
edition), Tata McGraw-Hill Publishing Company Ltd., New Delhi .
2. Biswajeet Pattanayak (2001), Human Resource Manage ment, Prentice Hall of
India Pvt. Ltd., New Delhi.
3. Lloyed L. Byers and Leslie W. Rue (1997), Human Resource Management (5th
edition), The McGraw-Hill Companies, USA.
4. Michael Armstrong (1999), A Handbook of Human Resource Management
Practice (7th edition), Kogan Page Limited, 120 Pentonvelle Road, London.
1.11 LEARNING ACTIVITIES
1. How would you handle this?
Too Many Friends,
You are the HR manager for a small company, consisting of twenty-three
people plus the two owners, Steve and Corey. Every time you go into Steves office,
you see he is on Face book. Because he is Face book friends with several people in
the organization, you have also heard he constantly updates his status and uploads
pictures during work time. Then, at meetings, Steve will ask employees if they saw
the pictures he recently uploaded from his vacation, weekend, or backpacking trip.
One employee, Sam, comes to you with a concern about this. I am just trying to do
my job, but I feel if I dont look at his photos, he may not think I am a good
employee, she says. How would you handle this?
1.12 KEYWORDS
Compensation, Motivation, Retention, Communicate, Telecommuting.

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LESSON 2
FUNCTIONS OF HRM
2.2 INTRODUCTION
Human Resources management has an important role to play in equipping
organizations to meet the challenges of an expanding and increasingly competitive
sector. Increase in staff numbers, contrac tual diversification and changes in
demographic profile which compel the HR managers to reconfigure the role and
significance of human resources management. The functions are responsive to
current staffing needs, but can be proactive in reshaping organizational objectives.
All the functions of HRM are correlated with the core objectives of HRM .For
example personal objectives is sought to be realized through functions like
remuneration, assessment etc.
2.2 OBJECTIVES
After reading this lesson, you should be able to
Know the functions of Human Resource Management.
Ascertain the different types of functions in HRM.
Define and present detailed explanation on functions of HRM.
2.3 CONTENTS
2.3.1 Functions of Human Resource Management.
2.3.2 Managerial Functions of Human Resource Management.
2.3.3 Operative Functions of Human Resource Management.
2.3.1 Functions of Human Resource Management
Human Resources management has an important role to play in equipping
organizations to meet the challenges of an expanding and increasingly competitive
sector. Increase in staff numbers, contractual diversification and changes in
demographic profile which compel the HR managers to reconfigure the role and
significance of human resources management. The functions are responsive to
current staffing needs, but can be proactive in reshaping organizational objectives.
All the functions of HRM are correlated with the core objectives of HRM. For
example personal objectives is sought to be realized through functions like
remuneration, assessment etc.
HR management can be thought of as seven interlinked functions taking place
within organizations. Additionally, external forceslegal, economic, technological,
global, environmental, cultural/geographic, political, and social significantly
affect how HR functions are designed, managed, and changed.
The functions can be grouped as follows:
1. Strategic HR Management
As a part of maintaining organizational competitiveness, strategic planning for
HR effectiveness can be increased through the u se of HR metrics and HR
technology. Human resource planning (HRP) function determine the number and
12
type of employees needed to accomplish organizational goals. HRP includes creating
venture teams with a balanced skill -mix, recruiting the right people, and voluntary
team assignment. This function analyzes and determines personnel needs in order
to create effective innovation teams. The basic HRP strategy is staffing and
employee development.
2. Equal Employment Opportunity
Compliance with equal employment opportunity (EEO) laws and regulations
affects all other HR activities.
3. Staffing
The aim of staffing is to provide a sufficient supply of qualified individuals to
fill jobs in an organization. Job analysis, recruitment and selection are the main
functions under staffing. Workers job design and job analysis laid the foundation
for staffing by identifying what diverse people do in their jobs and how they are
affected by them.
Job analysis is the process of describing the nature of a job and specifying the
human requirements such as knowledge, skills, and experience needed to perform
the job. The end result of job analysis is job description. Job description spells out
work duties and activities of employees. Through HR planning, managers anticipate
the future supply of and demand for employees and the nature of workforce issues,
including the retention of employees. So HRP precedes the actual selection of
people for organization. These factors are used when recruiting applicants for job
openings.
The selection process is concerned with choosing qualified individuals to fill
those jobs. In the selection function, the most qualified applicants are selected for
hiring from among the applicants based on the extent to which their abilities and
skills are matching with the job.
4. Talent Management and Development
Beginning with the orientation of new employees, talent management and
development includes different types of training. Orientation is the first step
towards helping a new employee to adjust himself to the new job and the employer.
It is a method to acquaint new employees with particular aspects of their new job,
including pay and benefit programmes, working hours and company rules and
expectations. Training and Development programs provide useful means of
assuring that the employees are capable of performing their jobs at acceptable
levels and also more than that. All the organizations provide training for new and in
experienced employee. In addition, organization often provide both on the job and
off the job training programmes for those employees whose jobs are undergoing
change.
Likewise, HR development and succession planning of employees and
managers is necessary to prepare for future challenges. Career planning has
developed as result of the desire of many employees to grow in their jobs and to
advance in their career. Career planning activities include assessing an individual
13
employees potential for growth and advancement in the organization. Performance
appraisal includes encouraging risk taking, demanding innovation, generating or
adopting new tasks, peer evaluation, frequent evaluations, and auditing innovation
processes. This function monitors employee performance to ensure that it is at
acceptable levels. This strategy appraises individual and team performance so that
there is a link between individual innovativeness and company profitability. Which
tasks should be appraised and who should assess employees performance are also
taken into account.
5. Total Rewards
Compensation in the form of pay, incentives and benefits are the rewards given
to the employees for performing organizational work. Compensation management is
the method for determining how much employees should be paid for performing
certain jobs. Compensation affects staffing in that people are generally attracted to
organizations offering a higher level of pay in exchange for the work performed. To
be competitive, employers develop and refine their basic compensation systems and
may use variable pay programs such as incentive rewards, promotion from within
the team, recognition rewards, balancing team and individual rewards etc.
This function uses rewards to motivate personnel to achieve an organizations
goals of productivity, innovation and profitability. Compensation is also relate d to
employee development in that it provides an important incentive in motivating
employees to higher levels of job performance to higher paying jobs in the
organization. Benefits are another form of compensation to employees other than
direct pay for the work performed. Benefits include both legally required items and
those offered at employers discretion. Benefits are primarily related to the area of
employee maintenance as they provide for many basic employee needs.
6. Risk Management and Worker Protection
HRM addresses various workplace risks to ensure protection of workers by
meeting legal requirements and being more responsive to concerns for workplace
health and safety along with disaster and recovery planning.
7. Employee and Labour Relations
The relationship between managers and their employees must be handled
legally and effectively. Employer and employee rights must be addressed. It is
important to develop, communicate, and update HR policies and procedures so that
managers and employees alike know what is expected. In some organizations,
union/management relations must be addressed as well. The term labour relation
refers to the interaction with employees who are represented by a trade union.
Unions are organization of employees who join togethe r to obtain more voice in
decisions affecting wages, benefits, working conditions and other aspects of
employment. With regard to labour relations the major function of HR personnel
includes negotiating with the unions regarding wages, service conditions and
resolving disputes and grievances.
14
2.3.2 Managerial Functions
The Human Resource Manager is a part of the organizational management. So
he must Perform the basic managerial functions of planning, organizing, directing
and controlling in relation to his department.
There functions are briefly discussed below:
1. Planning
To get things done through the subordinates, a manager must plan ahead.
Planning is necessary to determine the goals of the organization and lay down
policies and procedures to reach the goals. For a human resource manager,
planning means the determination of personnel programs that will contribute to the
goals of the enterprise, i.e., anticipating vacancies, planning job requirements, job
descriptions and determination of the sources of recruitment. The process of
personnel planning involves three essential steps. Firstly, a su pply and demand
forecast for each job category is made. This step requires knowledge to both labour
market conditions and the strategic posture and goals of the organization.
Secondly, net shortage and excess of personnel by job category are projected for a
specific time horizon. Finally, plans are developed to eliminate the forecast
shortages and excess of particular categories of human resources.
2. Organizing
Once the human resource manager has established objectives and developed
plans and programs to reach them, he must design and develop organization
structure to carry out the various operations. The organization structure basically
includes the following:
1. Grouping of personnel activity logically into functions or positions;
2. Assignment of different functions to different individuals;
3. Delegation of authority according to the tasks assigned and responsibilities
involved;
4. Co-ordination of activities of different individuals.
3. Directing
The plans are to be pure into effect by people. But how smoothly the plans are
implemented depends on the motivation of people. The direction function of the
personnel manager involves encouraging people to work willingly and effectively for
the goals of the enterprise. In other words, the direction function is meant to guide
and motivate the people to accomplish the personnel programs. The personnel
manager can motivate the employees in an organization through career planning,
salary administration, ensuring employee morale, developing cordial relationships
and provision of safety requirements and welfare of employees. The motivational
function poses a great challenge for any manager. The personnel manager must
have the ability to identify the needs of employees and the means and methods of
satisfy those needs. Motivation is a continuous process as new needs and
expectations emerge among employees when old ones are satisfied.
15
4. Controlling
Controlling is concerned with the regulation of activities in accordance with
the plans, which in turn have been formulated on the basis of the objectives of the
organization. Thus, controlling completes the cycle and leads back to planning. It
involves the observation and comparison of results with the standards and
correction of deviations that may occur. Controlling helps the personnel manager to
evaluate the control the performance of the personnel department in terms of
various operative functions. It involves performance appraisal, critical examination
of personnel records and statistics and personnel audit.
2.3.3 Operative Functions
The operative functions are those tasks or duties which are specifically
entrusted to the human resource or personnel department. These are concerned
with employment, development, compensation, integration and maintenance of
personnel of the organization.
The operative functions of human resource or personnel department are
discussed below:
1. Employment
The first operative function of the human resource of personnel department is
the employment of proper kind and number of persons necessary to achieve the
objectives of the organization. This involves recruitment, selection, placement, etc.
of the personnel. Before these processes are performed, it is better to determine the
manpower requirements both in terms of number and quality of the personnel.
Recruitment and selection cover the sources of supply of labour and the devices
designed to select the right type of people for various jobs. Induction and placement
of personnel for their better performance also come under the employment or
procurement function.
2. Development
Training and development of personnel is a follow up of the employment
function. It is a duty of management to train each employee property to develop
technical skills for the job for which he has been employed and also to develop him
for the higher jobs in the organization. Proper development of personnel is
necessary to increase their skills in doing their jobs and in satisfying their growth
need. For this purpose, the personnel departments will device appropriate training
programs. There are several on- the-job and off-the-job methods available for
training purposes. A good training program should include a mixture of both ty pes
of methods. It is important to point out that personnel department arranges for
training not only of new employees but also of old employees to update their
knowledge in the use of latest techniques.
3. Compensation
This function is concerned with the determination of adequate and equitable
remuneration of the employees in the organization of their contribution to the
organizational goals. The personnel can be compensated both in terms of monetary
16
as well as non-monetary rewards. Factors which must be borne in mind while fixing
the remuneration of personnel are their basic needs, requirements of jobs, legal
provisions regarding minimum wages, capacity of the organization to pay, wage
level afforded by competitors etc. For fixing the wage levels, the personnel
department can make use of certain techniques like job evaluation and
performance appraisal.
4. Maintenance (Working Conditions and Welfare)
Merely appointment and training of people is not sufficient; they must be
provided with good working, conditions so that they may like their work and
workplace and maintain their efficiency. Working conditions certainly influence
the motivation and morale of the employees. These include measures taken for health,
safety, and comfort of the workforce. The personnel department al so provides for
various welfare services which relate to the physical and social well -being of the
employees. These may include provision of cafeteria, rest rooms, counseling, group
insurance, education for children of employees, recreational facilities, e tc.
5. Motivation
Employees work in the organization for the satisfaction of their needs. In many
of the cases, it is found that they do not contribute towards the organizational goals
as much as they can. This happens because employees are not adequately
motivated. The human resource manager helps the various departmental managers
to design a system of financial and non-financial rewards to motivate the
employees.
6. Personnel Records
The human resource or personnel department maintains the records of the
employees working in the enterprise. It keeps full records of their training,
achievements, transfer, promotion, etc. It also preserves many other records
relating to the behavior of personnel like absenteeism and labour turnover and the
personnel programs and policies of the organization.
7. Industrial Relations
These days, the responsibility of maintaining good industrial relations is
mainly discharged by the human resource manager. The human resource manager
can help in collective bargaining, joint consultation and settlement of disputes, if
the need arises. This is because of the fact that he is in possession of full
information relating to personnel and has the working knowledge of various labour
enactments. The human resource manager can do a great de al in maintaining
industrial peace in the organisation as he is deeply associated with various
committees on discipline, labour welfare, safety, grievance, etc. He helps in laying
down the grievance procedure to redress the grievances of the employees. He also
gives authentic information to the trade union leaders and conveys their views on
various labour problems to the top management.
17
8. Separation
Since the first function of human resource management is to procure the
employees, it is logical that the last should be the separation and return of that
person to society. Most people do not die on the job. The organization is responsible
for meeting certain requirements of due process in separation, as well as assuring
that the returned person is in as good shape as possible. The personnel manager
has to ensure the release of retirement benefits to the retiring personnel in time.
2.4 REVISION POINTS
1. Functions of HRM
HR management can be thought of as seven interlinked functions taking
place within organizations. Additionally, external forceslegal, economic,
technological, global, environmental, cultural/geographic, political, and
social significantly affect how HR functions are designed, managed, and
changed.
2. Managerial functions
The Human Resource Manager is a part of the organizational management.
So he must Perform the basic managerial functions of planning, organizing,
directing and controlling in relation to hi s department.
3. Operative functions
The operative functions are those tasks or duties which are specifically
entrusted to the human resource or personnel department. These are
concerned with employment, development, compensation, integration and
maintenance of personnel of the organization.
1. What are the different types of HRM function?
2. What is managerial function? Explain.
3. What is operative function? Explain.
4. How managerial functions differ from operative functions?
5. Write short notes on the following:
a) HRM Functions.
b) Managerial Function
6. Operative Function.
7. List out the various sub functions in Managerial Functions of HRM.
8. List out the various sub functions in Operative Functions of HRM.
2.6 SUMMARY
Functions that fall under HRM today include staffing, creation of workplace
policies, compensation and benefits, retention, training and development, and
working with regulatory issues and worker protection. Human resource
management was once called the personnel department. In the past, hi ring people
and Working with hiring paperwork was this departments job. Today, the HRM
18
department has a much broader role, and as a result, HR managers must align
their strategies with the companys strategies. Human resource strategy is a set of
elaborate and systematic plans of action. The company objectives and goals should
be aligned with the objectives and goals of the individual departments.
Fill in the blanks:
1. ______________ determine the number and type of employees needed to
accomplish organizational goals.
2. Job analysis, recruitment and _________ are the main functions under
staffing.
3. The process of describing the nature of a job and specifying the human
requirements is ____________.
4. The tasks or duties which are specifically entrusted to the human resource
personnel department are ______________.
5. _____________ is necessary to determine the goals of the organization and lay
down policies and procedures to reach the goals.

1. Management-Drucker Peter F.
2. Personnel Management and Productivity Factors-Wadhwa, Raj. K
2.9 ASSIGNMENTS
1. Present a detailed account of the levels of management that are commonly
found in any large scale organization. What are the important skills at each
level?
1. Dessler, G. (2000); Human Resource Management; Prentice Hall, New York.
2. Grundy, T. and Brown, L. (2003); Value-based Human Resource Strategy;
Elsevier, Boston.
3. Mabey, C. and Salaman, G. (2000); Strategically Managing Human
Resources; Infinity Books, New Delhi.
4. Rao, V.S.P. (2001); Managing Human Resources- Text and Cases, Excel
Books, New Delhi.
5. Thite, M. (2004); Managing People in the New Economy, Sage Publications,
New Delhi.
1. Find out the recent trends in HRM functions.
2. Find out the functions other than Managerial and Operative Functions.
2.12 KEY WORDS
Operative function, Managerial function, Employment, Staffing.

19
LESSON 3
ORGANIZATION OF HRM DEPARTMENT
3.1 INTRODUCTION
Organizing is the function of management which follows planning. It is a
function in which the synchronization and combination of human, physical and
financial resources takes place. All the three resources are important to get results.
Therefore, organizational function helps in achievement of results which in fact is
important for the functioning of a concern. According to Chester Barnard,
Organizing is a function by which the concern is able to define the role positions,
the jobs related and the coordination between authority and responsibility. Hence,
a manager always has to organize in order to get results.
A manager performs organizing function with the help of following steps:
1. Identification of activities All the activities which have to be performed in a
concern have to be identified first. For example, preparation of accounts,
making sales, record keeping, quality control, inventory control, etc. All
these activities have to be grouped and classified into units.
2. Departmentally organizing the activities In this step, the manager tries to
combine and group similar and related activities into units or departments.
This organization of dividing the whole concern into independent units and
departments is called Departmentation.
3. Classifying the authority Once the departments are made, the manager
likes to classify the powers and its extent to the managers. This activity of
giving a rank in order to the managerial positions is called hierarchy. The
top management is into formulation of policies, the middle level management
into departmental supervision and lower level management into supervision
of foremen. The clarification of authority helps in bringing efficiency in the
running of a concern. This helps in achieving efficiency in the running of a
concern. This helps in avoiding wastage of time, money, effort, in avoidance
of duplication or overlapping of efforts and this helps in bringing
smoothness in a concerns working.
4. Coordination between authority and responsibilityRelationships are
established among various groups to enable smooth interaction toward the
achievement of the organizational goal. Each individual is made aware of his
authority and he/she knows whom they have to take orders from and to
whom they are accountable and to whom they have to report. A clear
organizational structure is drawn and all the employees are made aware of
it.
3.2 OBJECTIVES
Define and elaborate the structure of the HRM organ ization.
Explain the qualities of the HR Managers.
Explain the Qualifications of the good HR Managers.
20
3.3. CONTENTS
1.3.1 Organization of HRM Department
1.3.2 Qualities of HR Managers
1.3.3 Qualification of HR Managers
3.3.1 Organization of HRM Department
Overview
Organizational Structure and Human Resource Management, Formal and
Informal Organizations, Formal Organization, Informal Organization, Tall and Flat
Organizational Structures, Responsibility, Authority and Accountability,
Responsibility, Authority, Accountability, Line and Staff Functions, Line and Staff
Relationship, Line Staff Conflict, Human Resource Management as a Line
Responsibility, Human Resource Management as a Staff Function, The Role of
Human Resource Department in an Organization, Human Resource Management in
Harmony, Products and Human Resources, Production and Human Resources,
Marketing and Human Resources, Management Techniques and Human Resources,
Organizational Structure and Human Resources.
Organization of HRM Department
People who work together in organizations need a defined system or structure
through which they relate to each other and through which there can be a
coordination of their efforts. The defined relationships among the elements of an
organization, namely people, tasks, structure, and information and control
processes that characterize all organizations is referred to as organizational
structure.
Mechanistic structures are appropriate for static environments and organic
structures for dynamic environments. Formal organization refers to the intentional
structure of roles in a formally organized enterprise. Informal organization refers to
any joint personal activity without conscious joint purpose, even though it
contributes to joint results. There are two type s of structures tall and flat. A tall
structure is characterized by a narrow span of control and a flat structure by a high
span of control. The HR department consists of various jobs as a specialist, as a
facilitator, as a change agent and as a controller.
The key to growing beyond a manager's time, skill and knowledge limitations is
delegation the assignment of authority and responsibility to subordinates.
Authority refers to the right to give orders and the power to exact obedience.
Another aspect of delegation is accountability, which is the process wherein the
subordinate is held liable for performing those tasks which have been delegated to
him, with specific authority and responsibility. Formal relations are classified into
line and staff relations. Conflicts can arise between the line and staff functions. A
good understanding of line and staff relationships helps in developing harmonious
line staff relationships.
HRM is a staff function but a line responsibility. The HR department plays the
role of specialist a facilitator a change agent And a controller. The equations
21
between the line and staff functions have been changing in recent times, keeping
with the changing business and work environment.
Line and Staff Organization
Line and staff organization is a modification of line organization and it is more
complex than line organization. According to this administrative organization,
specialized and supportive activities are attached to the line of command by
appointing staff supervisors and staff specialists who are attached to the line
authority. The power of command always remains with the line executives and staff
supervisors guide, advice and council the line executives. Personal Secretary to the
Managing Director is a staff official.
Features of Line and Staff Organization
1. There are two types of staff:
Staff Assistants P.A. to Managing Director, Secretary to Marketing
Manager.
Staff Supervisor Operation Control Manager, Quality Controller, PRO
2. Line and Staff Organization is a compromise of line organization. It is more
complex than line concern.
3. Division of work and specialization takes place in line and staff organization.
4. The whole organization is divided into different functional areas to which
staff specialists are attached.
5. Efficiency can be achieved through the features of specialization.
6. There are two lines of authority which flow at one time in a concern:
Line Authority
Staff Authority
7. Power of command remains with the line executive and staff serves only as
counselors.
Merits of Line and Staff Organization
1. Relief to line of executives In a line and staff organization, the advice and
counseling which is provided to the line executives divides the work between
the two. The line executive can concentrate on the execution of plans and
they get relieved of dividing their attention to many areas.
2. Expert advice The line and staff organization facilitates expert advice to the
line executive at the time of need. The planning and investigation which is
related to different matters can be done by the staff specialist and line
officers can concentrate on execution of plans.
3. Benefit of Specialization Line and staff through division of whole concern
into two types of authority divides the enterprise into parts and functional
areas. This way every officer or official can concentrate in its own area.
22
4. Better coordination Line and staff organization through specialization is
able to provide better decision making and concentration remains in few
hands. This feature helps in bringing coordination in work as every official
is concentrating in their own area.
5. Benefits of Research and Development Through the advice of specialized
staff, the line executives, the line executives get time to execute plans by
taking productive decisions which are helpful for a concern. This gives a
wide scope to the line executive to bring innovations and go for research
work in those areas. This is possible due to the presence of staff specialists.
6. Training Due to the presence of staff specialists and their expert advice
serves as ground for training to line officials. Line executives can give due
concentration to their decision making. This in itself is a training ground for
them.
7. Balanced decisions The factor of specialization which is achieved by line
staff helps in bringing coordination. This relationship automatically ends up
the line official to take better and balanced decision.
8. Unity of action Unity of action is a result of unified control. Control and its
effectively take place when coordination is present in the concern. In the line
and staff authority all the officials have got independence to make decisions.
This serves as effective control in the whole enterprise.
Demerits of Line and Staff Organization
1. Lack of understanding In a line and staff organization, there are two
authorities flowing at one time. This results in the confusion between the
two. As a result, the workers are not able to understand as to who is their
commanding authority. Hence the problem of understanding can be a hurdle
in effective running.
2. Lack of sound advice The line official get used to the expertise advice of the
staff. At times the staff specialist also provides wrong decisions which the
line executives have to consider. This can affec t the efficient running of the
enterprise.
3. Line and staff conflicts Line and staff are two authorities which are flowing
at the same time. The factors of designations, status influence sentiments
which are related to their relation, can pose a distress on the minds of the
employees. This leads to minimizing of coordination which hampers a
concerns working.
4. Costly In line and staff concern, the concerns have to maintain the high
remuneration of staff specialist. This proves to be costly for a concern wi th
limited finance.
5. Assumption of authority The power of concern is with the line official but
the staff dislikes it as they are the one more in mental work.
23
6. Staff steals the show In a line and staff concern, the higher returns are
considered to be a product of staff advice and counseling. The line officials
feel dissatisfied and a feeling of distress enters a concern. The satisfaction of
line officials is very important for effective results.
3.3.2 Qualities of HR Managers
The qualities which will be applicable in general can be summarized as follows.
(i) Personal Attributes
The HR manager, as in case of any other manager, must have initiative
resourcefulness, depth of perception, maturity in judgment, and analytical ability.
Freedom from bias would enable the HR manager to take an objective view of both
of management and workers. He must thus have intellectual integrity. HR manger
should be thorough with labour laws. The HR manager must be familiar with
human needs, wants, hopes an desires, values, aspirations, etc., without which
adequate motivation is impossible.
The HR manager should also possess other personal attributes like:
(a) Intelligence: This includes skills to communicate, articulate, moderate,
understand, etc., command over language, mental ability and tact in dealing with
people intelligently, ability to draft agreements, policies etc.
(b) Educational skills: HR manager should possess learning and teaching
skills as he has to learn and teach employees about organizational growth, need for
and mode of development of individuals.
(c) Discriminating skills: HR manager should have the ability to discriminate
between right and wrong, between the just and unjust, merit and demerit.
(d) Executing skills: HR manager should execute HR issues with speed,
objectivity and accuracy. He should also be able to streamline the office, set
standards Coordinate and control, etc. of performance Coordinate and control, etc.
He should also have leadership qualities, deep faith in human values, empathy with
human problems, foreseeing future needs of employees, organization, government,
trade unions, society, etc.
(ii) Experience and Training
Previous experience is an added advantage, provided the experience in an
appropriate environment and in the same area, Training in psychological aspects,
labour legislations and in HR management. Experience in an enterprise in some
other executive capacity can also be towards an appreciation of the general
management problems and a practical approach in meeting HR problems.
(iii) Professional Attributes
HR manager should have patience and understanding, ability to listen before
offering advice. HR manager should have the kn owledge of various disciplines like
technology, engineering, management, sociology, philosophy and law He must be
able to couple his social justice with a warm personal intent in people which must
be secured by an uncommon degree of common sense.
24
3.3.3 Qualification of HR Managers
The job of personnel managers is complex. Meeting the ever increasing needs,
aspirations and expectations of employees is not easy.
To complicate his role further, top management expects the personnel
manager to:
1. Convey its commands, instructions policies and programs to employees in
an effective way.
2. Liaison with line managers smoothly.
3. Look after the safety and welfare of employees.
4. Take care of the legal provisions governing the workplace.
5. Offer expert advice on issues relating to human resources planning,
recruitment, training, appraisal, compensation etc.
In Union management relations the personnel man is expected to absorb
frayed tempers, notes of discontent and disagreements while creating a dialogue
and bringing about peace. While discharging the above duties and responsibilities
he is not expected to lose sight of his moral and social obligations towards
employees and the general public. The question of prescribing a set of qualifications
for personnel manager, in view of the expanding list of tasks, makes the search or a
suitable candidate rather challenging. Keeping the diversity and elasticity of the
personnel Managers job in mind.
3.4 REVISION POINTS
1. HRM Department
People who work together in organizations need a defined system or
structure through which they relate to each other and through which there
can be a coordination of their efforts. The defined relationships among the
elements of an organization, namely people, tasks, structure, and
information and control processes that characterize all organizations is
referred to as organizational structure.
2. Line and Staff Organization
Line and staff organization is a modification of line organization and it is
more complex than line organization. According to this administrative
organization, specialized and supportive activities are attached to the line of
command by appointing staff supervisors and staff specialists who are
attached to the line authority. The power of command always remains with
the line executives and staff supervisors guide, advice and council the line
executives.
3. There are two types of staff:
Staff Assistants P.A. to Managing Director, Secretary to Marketing
Manager.
Staff Supervisor Operation Control Manager, Quality Controller, PRO
25
1. Define organization of HRM Department?
2. What are the qualities of good HR manager?
3. What are the qualifications of HR Manager?
4. What is line and staff? Explain with detail.
5. Enlighten the various additional qualities of HR Manager.
6. How will you acquire the qualities and qualification to become an good HR
manager?
3.6 SUMMARY
The rate of change facing organizations has never been greater and
organizations must absorb and manage change at a much faster rate rather than in
the past. In order to implement a successful business strategy to face this
challenge, organizations, large or small, must ensure that they have the right
people capable of delivering the strategy. As organization vary i n size, aim, function,
complexity, construction, the physical nature of their product and appeal as
employers, so do the contribution of human resource management. But in most
ultimate aim of function is to ensure that at all times the business is correctly
staffed by the right number of people with the skills relevant to the business need.
The organizations of HRM Department have different types dimensions to achieve
the objective of the company or industry. So this lesson explained the detailed
information about the qualities and qualification of the HR Managers to attain that
goal.
Match the following
1. Staff Assistant - Governing work place
2. Staff Supervisor - Learning and teaching
3. Quality of HR Manager - P.A. to Managing Director
4. Qualification of HR Manager - Operation control Manager
5. Educational Skill - Experience and training
1. Organizational Behaviour - Levin, Richard
2. Behavioural Science - Ghanekar, Anjali
3.9 ASSIGNMENTS
1. With necessary diagram, explicate Organizational structure of the HRM
Department of your own organization.
2. How will you differ qualities from qualification?
26
1. Human Resource Management by Dessler, Gary, Publisher: Pearson
Education Asia, New Delhi.
2. Human Resource Management by Aswthappa, Publisher: TMH, New Delhi
3. Human Resource Management-Text & Cases, by Rao, V.S.P, Publisher: Excel
Books, New Delhi.
4. Managing Human Resources by Ramaswamy, E., Publisher: Oxford
University Press, New Delhi
Case study
Surya Electric Bulbs is a large multi-product Company. Mr. Jayadev is the
chief architect of the Company in steering the affairs on successful lines. Mr.
Lakshman, with 25 years of experience, became the new Chief Executive Officer of
the Company. He pondered over the question. How to keep long -term profitability
intact? He focused his attention on new ways of developing strategies.
The new strategy is to increase its market share lest foreign Companies may
enchroach its market with higher quality products, faster and cheaper. While
Suryas high technology products exhibited strong performance, its traditional
products have been started dwindling partly because of recession and partly
because of foreign products.
The Companys original strategy of long-term profits is slowly given-up to
market share. Mr. Lakshman would like to keep the Company either No.1 or No.2
in terms of market share. In order to achieve this objective, discretion in spending
is given to Divisional Managers. Mr. Lakshman is of the view that innovative way of
marketing products alone can ensure future.
Questions
1. Is the Companys new policy of netting more market share to profits
appropriate?
2. How you would advocate the new objective?
3.12 KEYWORDS
Organization, Qualities, Qualification, Line and Staff, Manager.

27
LESSON 4
HR POLICY
4.2 INTRODUCTION
The effective management of an organizations employees (i.e. its human
resources) is arguably the single most difficult, most complex, most ambiguous, yet
most important task that managers face. It is an area of management policy-
making that is not characterized by rigorous globally accepted professional
standards. This is true for at least four reasons:
1. HR policies refer to human behavior, which is complex, often conflict ridden,
and culturally dependent.
2. There are many different HR policy instruments an d practices.
3. The success or otherwise of different HR policies, programmes and plans is
difficult to evaluate.
Many managers believe that people management is just common sense.
4.1 OBJECTIVES
Having suggested some reasons why HR management is complex, we now
want to explain why it is nevertheless very important to get it right, and from there
to consider the principal objectives or purposes of HR policy. We need to consider
three linked statements:
To know what leads to organizational success
To know the role of HR.
To find the underlying objective of HR policy.
4.3 CONTENTS
4.3.1 HR Policies
4.3.2 Environmental Influences of HRM
4.3.3 HRM Challenges
4.3.4 HRM Strategies
4.3.1 HR Policies
HR policies refer to human behaviour
Because HR policy deals with managing people, it involves human behaviour
and relationships that are inherently complex, potentially conflictual and
sometimes problematic. Machines or money markets are so much easier to deal
with than people, so that (contrary to much popular opinion) be ing a production
engineer or a finance officer is arguably far easier and more straightforward than
being responsible for people management.
In order to understand HR policy properly, whether as an analyst or as a
practitioner, you need to acquire many skills. You need to know how and why
organizations make the choices they do and behave the way they do; this means
you need a theory of the firm.1 But you also need to know how and why workers
behave and react in the ways they do, whether as individuals or in groups; and you
28
need to be able to judge how they might behave and react if circumstances (e.g. the
HR policies) were to alter; this means, among other things, that you need effective
theories of motivation. These are formidable requirements, and they imply that you
need to blend together the different social science disciplines, for example,
economics, industrial relations and organisational behaviour.
HR policy is therefore inherently multidisciplinary, which might make it more
interesting for some but definitely makes it more difficult for everyone. You also
need to know more than just the theory; you need to know the empirical work too.
This requires a grasp of research design, a store of complex information, and the
ability to manipulate and interpret that information, which is why statistical
expertise is becoming part of the HR professionals job description. So, to
understand and design HR policies properly is not a trivial intellectual task.
Many HR policy instruments and practices
A second reason why HR policy is hard to get right comes from its multiplicity
of policy instruments. Policy-makers in all fields have policy instruments. One
problem for HR policy-makers is that there are so many HR instruments available
to them: hiring policy, induction policy, training policy, employee development
policy, pay and rewards policy, job design decisions, career or promotion policies,
and so on.
Adding to the complexity, each area of HR policy is likely to have some impact
on the others. This means that it is unwise to analyse any single policy in isolation
from the others. One should instead see it in the context of the whole, which means
having a sense of possible HR strategies, or groups of policies. The very multiplicity
of policies makes the whole subject ambiguous.
HR policies, programmes and plans are difficult to evaluate
A third reason why HR policy is so difficult is that HR policies, programmes
and plans are very hard to evaluate properly, so that managers cannot easily
establish whether their policy choices are wise. Neither can outside analysts easily
find out whether a firms policies, or those of a set of firms, are working optimally.
HR managers often distinguish between policies (local sets of rules or codes
established help coordinate people management activities within an organisation),
programmes (interventions designed by HR managers to achieve specific objectives
such as a change programme following a merger or redundancy programme
resulting from a prolonged decline in sales) and plans (specific instruments or tools
such as an incentive plan).
These three active forms of intervention can be contrasted with HR practices,
which are informal rules or codes the way things are done around here. These
are helpful distinctions to use when evaluating HR activities. Natural scientists can
conduct controlled experiments to assess the full consequences of a course of
action. Social scientists cannot usually do this, and when they can it is normally
possible only in the artificial environment of the social science laboratory. Running
controlled experiments in the real world of work is exceedingly hard, and very rare.
29
So HR policy evaluations have to be done indirectly, and with much less precision.
The result is that no one can be at all confident that managers are in fact doing the
right thing, even if their HR policy choices look plausible by the standards of
common sense or some theory.
People management is just common sense
The fourth reason why HR is so hard to get right is the prejudice shared by so
many managers that people management can be done by almost anyone, and
requires common sense rather than special training. It seems that everyone has an
opinion on HR issues. HR is sometimes seen as an area of management that should
be done by those who are not quite good enough to do other more demanding
management tasks.
4.3.2 Environmental Influences of HRM
Personnel managers cannot perform their job in vacuum as a number of
environmental factors affect HRM. Environment furnishes the macro context and
the organisation is the micro unit. Of primary importance here are the external
influences of economic conditions, labour markets, laws and regulations and labour
unions. Each of these external factors separately or in combination can influence
the HRM function of any organization. Changes in the external environment have a
profound impact on the personnel. These changes include technological
obsolescence, culture and social changes, and policies of the government. The
external environment consists of factors that affect an organizations human
resources from outside it. Let us examine these factors in detail:
1. Technological Innovation: Rapid technological changes and innovations are
taking place all over the world. As a result of these, technical personnel are
increasingly required. Hence , procurement of technically skilled employees
is necessary to match the changing job requirements.
2. Economic Factors: Economic conditions influence financial health of the
organization. Under favorable economic condition, expansion of existing
programmes and creation of new programme are very likely. With less
favorable or deteriorating condition, contraction or cancellation of some
programme may be necessary.
3. Employees Organizations: Employees organizations have mustered strength
to match the growth of industrialization. Labour unions seek to bargain with
management over the terms and conditions of employment for their
members.
4. Labour Markets: In labour markets, organizations seek employees (demand
and labour), and individuals offer their services to organizations (supply and
labour). Labour supply and demand have implications on all activities, but
particularly for compensation and external staffing.
5. Changing Demand of Employers: Organizations also undergo changes and
consequently their demands on employees also change. The technologic al
revolution and stiff business competition demands that the existing
30
employees adapt to every changing work situation and learn new skills,
knowledge etc., to
6. cope up with the new changes. C O M
7. Legal Factors: It has to manage its employees according to the legislation
enacted by the government at the centre and the states. The Important
Legislations Enacted in India Affecting HRM
8. are: Factories Act, Trade Unions Act, Workmens Compensation Act, T he
Payment of Wages Act, The Minimum Wages Act, Payment of Gratuity Act,
and The Maternity Benefit Act. The government is the custodian of industrial
and economic activities.
9. Human Resource in the country: The structure, values and the level of
education of human resource in the country influence the HRM function of
any organization. The influence of manpower in the country can be studied
through:
Change in the structure of employment with the entry of workforce with
different backgrounds.
Changes that have taken place in the structure of the workforce over
the years and led to the emergence of new values in organizations.
Increased level of formal education which has led to changes in the
employee attitude.
Educated employees always challenge and question the managements
decisions and want a voice in the companys affairs affecting their
interest.
Thus, many environment factors affect the performance of specific tasks of
HRM. Changes in the internal and external environment factors complicate the job
both of line and personnel managers in overseeing the contributions of human
resources. Considering the complexities and challenges in the HRM now and in
near future managements have to develop sophisticated techniques and competent
people to manage personnel on sound lines.
4.3.3 HRM Challenges
All departments within an organization must prove their value and
contributions to the overall business strategy, and the same is true with HRM. As
companies are becoming more concerned with cutting costs, HRM departments
must show the value they add to the organization through alignment with business
objectives. Being able to add value starts with understanding some of the
challenges of businesses and finding ways to reduce a negative impact on the
business. This section will discuss some of the HRM challenges, and the rest of this
text will dive into greater detail about how to manage these challenges.
31
Containing Costs
If you were to ask most business owners what their biggest challenges are,
they will likely tell you that cost management is a major factor to the success or
failure of their business. In most businesses today, the people part of the business
is the most likely place for cuts when the economy isnt doing well.
Consider the expenses that involve the pe ople part of any business:
1. Health-care benefits
2. Training costs
3. Hiring process costs
4. And many more
These costs cut into the bottom line of any business. The trick is to figure out
how much, how many, or how often benefits should be offered, without sacrificing
employee motivation. A company can cut costs by not offering benefits or 401(k)
plans, but if its goal is to hire the best people, a hiring package without these items
will most certainly not get the best people. Containment of costs, therefore, is a
balancing act. An HR manager must offer as much as he or she can to attract and
retain employees, but not offer too much, as this can put pressure on the
companys bottom line.
Technology
Technology has greatly impacted human resources and will continue to do so
as new technology is developed. Through use of technology, many companies have
virtual workforces that perform tasks from nearly all corners of the world. When
employees are not located just down the hall, management of these human
resources creates some unique challenges. For example, technology creates an even
greater need to have multicultural or diversity understanding. Since many people
will work with individuals from across the globe, cultural sensitivity and
understanding is the only way to en sure the use of technology results in increased
productivity rather than decreased productivity due to miscommunications.
The Economy
Tough economic times in a country usually results in tough times for
business, too. High unemployment and layoffs are clearly HRM and managerial
issues. If a human resource manager works for a unionized company, union
contracts are the guiding source when having to downsize owing to a tough
economy. Besides union restrictions, legal restrictions on who is let go and the
process followed to let someone go should be on the forefront of any managers
mind when he or she is required to lay off people because of a poor economy.
Dealing with performance issues and measuring performance can be considerations
when it is necessary to lay off employees.
Likewise, in a growth economy, the HR manager may experience a different
kind of stress. Massive hiring to meet demand might occur if the economy is doing
well. For example, McDonalds restaurants had to fill six hundred positions
32
throughout Las Vegas and held hiring day events in 2010. [8] Imagine the process
of hiring this many people in a short period of time The same recruiting and
selection processes used under normal circumstances will be helpful in mass hiring
situations.
The Changing and Diverse Workforce
Human resources should be aware that the workforce is constantly changing.
Ethics
A discussion of ethics is necessary when considering challenges of human
resources. Much of the discussion surrounding ethics happened after the early to
mid-2000s, when several companies were found to have engaged in gross unethical
and illegal conduct, resulting in the loss of billions of dollars from shareholders.
Consider the statistics: only 25 percent of employees trusted their CEO to tell the
truth, and 80 percent of people said that employers have a moral responsibility to
society. Based on these numbers, an ethical workplace is important not only for
shareholder satisfaction but for employee satisfaction as well. Companies are seeing
the value of implementing ethics codes within the business. Many human resource
departments have the responsibility of designing codes of ethics and developing
policies for ethical decision making. Some organizations hire ethics officers to
specifically focus on this area of the business. Out of four hundred companies
surveyed, 48 percent had an ethics officer, who reported to either the CEO or the
HR executive. According to Steve Miranda, chief human resources officer for the
Society for Human Resource Management (SHRM), [the presence of an ethics
officer] provides a high-level individual with positional authority who can ensure
that policies, practices, and guidelines are effectively communicated across the
organization.
4.3.4 HRM Strategies
The terms strategic HRM and HR strategy are often used interchangeably,
but a distinction can be made between them. Strategic HRM can be regarded as a
general approach to the strategic management of human resources in accordance
with the intentions of the organization on the future direction it wants to take.
What emerges from this process is a stream of decisions over time, which form the
pattern adopted by the organization for managing its human resources and define
the areas in which specific HR strategies need to be developed. HR strategies will
focus on the specific intentions of the organization on what needs to be done and
what needs to be changed.
This lesson starts by defining what HR strategies are and what they set out to
do, continues with descriptions of different types of strategy with examples, and
concludes with a list of the criteria for an effective strategy.
HR Strategies Definition
HR strategies set out what the organization intends to do about its human
resource management policies and practices, and how they should be integrated
with the business strategy and each other. They are described by Dyer and Reeves
33
(1995) as internally consistent bundles of human resource practices, and in the
words of Peter Boxall (1996) they provide a framework of critical ends and means.
The purpose of HR strategies is to guide development and implementation
programmes. They provide a means of communicating to all concerned the
intentions of the organization about how its human resources will be managed.
They enable the organization to measure progress and evaluate outcomes against
objectives.
Types of HR Strategies
Because all organizations are different, all HR strategies are different. There is
no such thing as a set of standard characteristics. Research into HR strateg y
conducted by Armstrong and Long (1994) and Armstrong and Baron (2002)
revealed many variations. Some strategies are simply very general declarations of
intent. Others go into much more detail. But two basic types of HR strategies can
be identified.
These are:
1. Overarching strategies and
2. Specific strategies relating to the different aspects of human resource
management.
Overarching HR Strategies
Overarching strategies describe the general intentions of the organization
about how people should be managed and developed and what steps should be
taken to ensure that the organization can attract and retain the people it needs and
ensure so far as possible that employees are committed, motivated and engaged.
They are likely to be expressed as broadbrush statements of aims and purpose,
which set the scene for more specific strategies. They are concerned with overall
organizational effectiveness achieving human resource advantage by, as Boxall
and Purcell (2003) point out, employing better people in organizations with better
process, developing high performance work processes and Human Resource
Management.
Establishment of Grievance Redressal Machinery in every Industrial
establishment employing twenty or more workmen for the resolution of
disputes arising out of individual grievances
Empowering the Labour Court or Tribunal to execute the awards, orders or
settlements arrived at by Labour Court or Tribun al generally creating a
great place to work.
Specific HR Strategies
Specific HR strategies set out what the organization intends to do in areas
such as: talent management how the organization intends to win the war for
talent Continuous improvement providing for focused and continuous
incremental innovation sustained over a period of time knowledge management
creating, acquiring, capturing, sharing and using knowledge to enhance learning
and performance resourcing attracting and retaining high quality people learning
34
and developing providing an environment in which employees are encouraged to
learn and develop reward defining what the organization wants to do in the longer
term to develop and implement reward policies, practices and processes that will
further the achievement of its business goals and meet the needs of its
stakeholders employee relations defining the intentions of the organization about
what needs to be done and what needs to be changed in the ways in which the
organization manages its relationships with employees and their trade unions.
Criteria for an Effective HR Strategy
An effective HR strategy is one that works in the sense that it achieves what it
sets out to achieve. In particular, it: will satisfy business needs be founded on
detailed analysis and study, not just wishful thinking can be turned into actionable
programmes that anticipate implementation requirements and problems is
coherent and integrated, being composed of components that fit with and suppo rt
each other takes account of the needs of line managers and employees generally as
well as those of the organization and its other stakeholders. As Boxall and Purcell
(2003) emphasize: HR planning should aim to meet the needs of the key
stakeholder groups involved in people management in the firm.
4.4 REVISION POINTS
1. Environmental Influences of HRM
Personnel managers cannot perform their job in vacuum as a number of
environmental factors affect HRM. Environment furnishes the macro
context and the organisation is the micro unit. Of primary importance here
are the external influences of economic conditions, labour markets, laws and
regulations and labour unions.
2. Effective HR Strategy
An effective HR strategy is one that works in the sense that it achieves what
it sets out to achieve. In particular, it: will satisfy business needs be
founded on detailed analysis and study, not just wishful thinking can be
turned into actionable programmes that anticipate implementation
requirements and problems is coherent and integrated, being composed of
components that fit with and support each other takes account of the needs
of line managers and employees generally as well as those of the
organization and its other stakeholders.
3. HRM Strategies
The terms Strategic HRM and HR Strategy are often used interchangeably,
but a distinction can be made between them. Strategic HRM can be regarded
as a general approach to the strategic management of human resources in
accordance with the intentions of the organization on the future direction it
wants to take.
35
1. What is HR Policy? Explain with detail.
2. What are factor environmental factors influencing on HRM?
3. Explain HRM Challenges and HRM Strategy?
4.6 SUMMARY
The detailed explanation about HR policy, environmental Influences of HRM,
HRM Challenges and HRM strategies were given with examples. It contains HR
Policies Refer To Human Behaviour, Many HR Policy Instruments And Practices, HR
Policies, Programmes, Plans are Difficult To Evaluate People Management Is Just
Common Sense, Environmental Influences Of HRM, HRM Challenges, Containing
Costs, Technology, The Economy, The Changing And Diverse Workforce, Ethics,
HRM Strategies, HR Strategies Definition, Types Of HR Strategies, Overarching HR
Strategies, Specific HR Strategies and Criteria For An Effective HR Strategy.
Match the following
1. HR Instrument - Sets of rules or codes
2. Policies - Talent management
3. Legal factors - Career or promotion policies
4. Specific HR Strategies - Demand and labour
5. Labour Market - Legislation enacted by the
government
1. Kramar, R. and J. Syed Human resource management in a global context.
(Basingstoke: Palgrave, 2012) first edition [ISBN 9780230251533] Chapter 1
Contextualizing human resource management and Chapter 2 A critical
perspective on strategic human resource management.
2. Torrington, D., L. Hall, S. Taylor and C. Atkinson Fundamentals of human
resource management. (Harlow: Financial Times Prentice Hall, 2009) first
edition [ISBN 9780273713067] Chapter 1 Introducing human resource
management.
4.9 ASSIGNMENTS
1. Are there any other objectives of HR policy apart from controlling unit labour
costs?
1. Books
Bratton, J. and J. Gold Human resource management: theory and practice .
(Basingstoke: Palgrave, 2012) second edition [ISBN 9780805838626]
Chapter 1 The nature of contemporary HRM.
36
2. Journal articles
Huselid, M. The impact of human resource management practices on
turnover, productivity, and corporate financial performance, Academy of
Management Journal 38(3) 1995, pp.64570.
3. References cited
Dessler, G. Human resource management. (Pearson, 2007) eleventh edition.
Hellriegel, D., S. Jackson, J. Slocum and G. Staude Management. (Oxford
University Press, 2009) third edition. Chapter 13 Managing human
resources [ISBN 9780195982169].
1. Describe what is meant by HR Management
2. Explain why HR policies, programmes and plans are key to an
Organizations Success
3. Discuss the difference between academic study and the practice of HR
Management.
4.12 KEY WORDS
Policy, Environment Influence, Challenges and Strategy.

37
UNIT II : HUMAN RESOURCE PLANNING, RECRUITMENT AND SELECTION
LESSON 5
HUMAN RESOURCE PLANNING
5.1 INTRODUCTION
First part of Human resource strategy is HRP Human Resource Planning. All
other HR activities like employee hiring, training and development, remuneration,
appraisal and labour relations are derived from HRP.HR planning is important in a
wide variety of industries and firms. HR planning affects what employers do when
recruiting, selecting, and retaining people, and of course these actions affect
organizational results and success. The challenges caused by changing economic
conditions during recent years show why HR workforce planning should occur.
Staffing an organization is an HR activity that is both strategic and operational
in nature. As the HR Headline indicates, HR planning is important in a wide variety
of industries and firms. HR planning affects what employers do when recruiting,
selecting, and retaining people, and, of course these actions affect organizational
results and success. Human Resources planning mean different means to different
organizations. To some companies, human resources plannin g mean management
development. It involve helping executives to make better decisions, communicate
more effectively, and know more about the firm. The purpose of HRP is to make the
manager a better equipped for facing the present and future.
5.2 OBJECTIVES
Understand the nature and need of HRP
Gain information about different factors that affect HRP
Realize the importance of human resource planning in current
organizational scenario
Understand the HRP process and the pre requisites for successful HRP
process
5.3 CONTENTS
5.3.1 Meaning of HRP
5.3.2 Need and Importance
5.3.3 Objectives
5.3.4 Problems and Process
5.3.1 Meaning of HRP
According to Vetter, HRP is the process by which management determines
how the organization should move from its current man power position to desired
manpower position. Through planning, management strives to have the right time,
doing things which result in both the organization and individual receiving
maximum long run benefits.
38
According to Gordon Mc Beath, HRP is concerned with two things: Planning
of manpower requirements and Planning of Manpower supplies.
According to Beach, HRP is a process of determining and assuming that the
organization will have an adequate number of qualified persons, available at proper
times, performing jobs which meet the needs of the enterprise and which provides
satisfaction for the individuals involved
Simply HRP can be understood as the process of forecasting an organizations
future demands for and su pply of the right type of people in the right number. In
other words HRP is the process of determining manpower needs and formulating
plans to meet these needs.
5.3.2 Need and Importance
Need for HRP in Organizations
Major reasons for the emphasis on HRP at the Macro level:
1) Employment-Unemployment Situation: Though in general the number of
educated unemployment is on the rise, there is acute shortage for a variety of skills.
This emphasizes on the need for more effective recruitment and employee retention.
2) Technological Change: The changes in production technologies, marketing
methods and management techniques have been extensive and rapid. Their effect
has been profound on the job contents and job contexts. These changes have
caused problems relating to redundancies, retention and redeployment. All these
suggest the need to plan manpower needs intensively and systematically.
3) Demographic Change: The changing profile of the work force in terms of
age, sex, literacy, technical inputs and social background has implications for HRP.
4) Skill Shortage: Unemployment does not mean that the labour market is a
buyers market. Organizations generally become more complex and require a wide
range of specialist skills that are rare and scare. A problem ari ses in an
organization when employees with such specialized skills leave.
5) Governmental Influences: Government control and changes in legislation with
regard to affirmative action for disadvantages groups, working conditions and hours of
work, restrictions on women and child employment, causal and contract labour, etc.
have stimulated the organizations to be become involved in systematic HRP.
6) Legislative Control: The policies of hire and fire have gone. Now the
legislation makes it difficult to reduce the size of an organization quickly and
cheaply. It is easy to increase but difficult to shed the fat in terms of the numbers
employed because of recent changes in labour law relating to lay-offs and closures.
Those responsible for managing manpower must look far ahead and thus attempt
to foresee manpower problems.
7) Impact of the Pressure Group: Pressure groups such as unions,
politicians and persons displaced from land by location of giant enterprises have
been raising contradictory pressure on enterprise management such as internal
39
recruitment and promotion, preference to employees children, displace person,
sons of soil etc.
8) Systems Approach: The spread of system thinking and advent of the macro
computer as the part of the on-going revolution in information technology which
emphasis planning and newer ways of handling voluminous personnel records.
9) Lead Time: The log lead time is necessary in the selection process and
training and deployment of the employee to handle new knowledge and skills
successfully.
Importance of HRP
HRP is the su bsystem in the total organizational planning. Organizational
planning includes managerial activities that set the companys objective for the
future and determines the appropriate means for achieving those objectives. The
importance of HRP is elaborated on the basis of the key roles that it is playing in
the organization.
1. Future Personnel Needs: Human resource planning is significant because
it helps to determine the future personnel needs of the organization. If an
organization is facing the problem of either surplus or deficiency in staff strength,
then it is the result of the absence of effecting HR planning. All public sector
enterprises find themselves overstaffed now as they never had any planning for
personnel requirement and went of recruitment spree till late 1980s. The problem
of excess staff has become such a prominent problem that many private sector
units are resorting to VRS voluntary retirement scheme. The excess of labor
problem would have been there if the organization had good HRP system. Effective
HRP system will also enable the organization to have good succession planning.
2. Part of Strategic Planning: HRP has become an integral part of strategic
planning of strategic planning. HRP provides inputs in strategy formulation process
in terms of deciding whether the organization has got the right kind of human
resources to carry out the given strategy. HRP is also necessary during the
implementation stage in the form of deciding to make resource allocation decisions
related to organization structure, process and human resources. In some
organizations HRP play as significant role as strategic planning and HR issues are
perceived as inherent in business management.
3. Creating Highly Talented Personnel: Even though India has a great pool
of educated unemployed, it is the discretion of HR manager that will enable the
company to recruit the right person with right skills to the organization. Even the
existing staff hope the job so frequently that organization face frequent shortage of
manpower. Manpower planning in the form of skill development is required to help
the organization in dealing with this problem of ski lled manpower shortage
4. International Strategies: An international expansion strategy of an
organization is facilitated to a great extent by HR planning. The HR departments
ability to fill key jobs with foreign nationals and reassignment of employees from
within or across national borders is a major challenge that is being faced by
40
international business. With the growing trend towards global operation, the need
for HRP will as well will be the need to integrate HRP more closely with the
organizations strategic plans. Without effective HRP and subsequent attention to
employee recruitment, selection, placement, development, and career planning, the
growing competition for foreign executives may lead to expensive and strategically
descriptive turnover among key decision makers.
5. Foundation for Personnel Functions: HRP provides essential information
for designing and implementing personnel functions, such as recruitment,
selection, training and development, personnel movement like transfers,
promotions and layoffs.
6. Increasing Investments in Human Resources: Organizations are making
increasing investments in human resource development compelling the increased
need for HRP. Organizations are realizing that human assets can increase in value
more than the physical assets. An employee who gradually develops his/ her skills
and abilities become a valuable asset for the organization. Organizations can make
investments in its personnel either through direct training or job assignment and
the rupee value of such a trained, flexible, motivated productive workforce is
difficult to determine. Top officials have started acknowledging that quality of work
force is responsible for both short term and long term performance of the
organization.
7. Resistance to Change: Employees are always reluctant whenever they hear
about change and even about job rotation. Organizations cannot shift one employee
from one department to another without any specific planning. Even for carrying
out job rotation (shifting one employee from on e department to another) there is a
need to plan well ahead and match the skills required and existing skills of the
employees.
8. Uniting the Viewpoint of Line and Staff Managers: HRP helps to unite
the viewpoints of line and staff managers. Though HRP is initiated and executed by
the corporate staff, it requires the input and cooperation of all managers within an
organization. Each department manager knows about the issues faced by his
department more than anyone else. So communication between HR staff an d line
managers is essential for the success of HR Planning and development.
9. Succession Planning: Human Resource Planning prepares people for
future challenges. The stars are picked up, trained, assessed and assisted
continuously so that when the time comes such trained employees can quickly take
the responsibilities and position of their boss or seniors as and when situation
arrives.
10. Other Benefits: (a) HRP helps in judging the effectiveness of manpower
policies and programmes of management. (b) It develops awareness on effective
utilization of human resources for the overall development of organization. (c) It
facilitates selection and training of employees with adequate knowledge, experience
and aptitudes so as to carry on and achieve the organi zational objectives (d) HRP
41
encourages the company to review and modify its human resource policies and
practices and to examine the way of utilizing the human resources for better
utilization.
5.3.3 Objectives
Objectives of Human Resource Planning
1. To ensure optimum utilization of human resources currently available in the
organization.
2. To assess or forecast the future skill requirement of the organization.
3. To provide control measures to ensure that necessary resources are
available as and when required.
4. A series of specified reasons are there that attaches importance to manpower
planning and forecasting exercises.
They are elaborated below:
To link manpower planning with the organizational planning
To determine recruitment levels.
To anticipate redundancies.
To determine optimum training levels.
To provide a basis for management development programs.
To cost the manpower.
To assist productivity bargaining.
To assess future accommodation requirement.
To study the cost of overheads and value of service functions.
To decide whether certain activity needs to be subcontracted, etc.
HRP exists as a part of planning process of business. This is the activity that
aims to coordinate the requirements for the availability of the different types of
employers. The major activities are the forecasting, (future requirements),
inventorying (present strength), anticipating (comparison of present and future
requirements) and planning (necessary program to meet the requirements). The HR
forecasts are responsible for estimating the number of people and the jobs needed
by an organization to achieve its objectives and realize its plans in the most efficient
and effective manner. HR needs are computed by subtracting HR supplies or
number of the employees available from expected HR demands or number of people
required to produce a desired level of outcome. The objective of HR is to provide
right personnel for the right work and optimum utilization of the existing human
resources.
The objectives of human resource planning may be summarized as below:
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Forecasting Human Resources Requirements: HRP is essential to determine
the future needs of HR in an organization. In the absence of this plan it is very
difficult to provide the right kind of people at the right time.
Effective Management of Change: Proper planning is required to cope with
changes in the different aspects which affect the organization. These changes
need continuation of allocation/ reallocation and effective utilization of HR in
organization.
Realizing the Organizational Goals: In order to meet the expansion and
other organizational activities the organizational HR planning is essential.
Promoting Employees: HRP gives the feedback in the form of employee data
which can be used in decision-making in promotional opportunities to be
made available for the organization.
Effective Utilization of HR: The data base will provide the useful information
in identifying surplus and deficiency in human resources. The objective of
HRP is to maintain and improve the organizational capacity to reach its goals
by developing appropriate strategies that will result in the maximum
contribution of HR.
5.3.4 Problems and Process
Factors Affecting HRP
HRP is influenced by several factors. The most important of the factors that
affect HRP are (1) type and strategy of organization (2) organizational growth cycles
and planning (3) environmental uncertainties (4)time horizons (5) type and quality
of forecasting information (4) nature of jobs being filled and (5) off loading the work.
1. Type and Strategy of the Organization: Type of the organization
determines the production processes involve, number and type of staff needed and
the supervisory and managerial personnel required. HR need is also defined by the
strategic plan of organization. If the organization has a plan for organic growth then
organization need to hire additional employees. On the other hand if the
organization is going for mergers and acquisition, then organization need to plan for
layoffs, as mergers can create, duplicate or overlap positions that can be handled
more efficiently with fewer employees.
Organization first decides whether to be reactive or proactive in HRP.
Organizations either carefully anticipate the needs and systematically plan to fill
the need in advance (proactive) or can simply react to the needs as they arise
(reactive). Likewise, the organization must determine the width of the HR plan.
Organization can choose a narrow focus by planning in only one or two HR areas
like recruitment and selection or can have a broad perspective by planning in all
areas including training and remuneration.
The nature of HR plan is also decides upon the formality of the plan. It can
decides to have an informal plan that lies mostly in the minds of the managers and
personnel staff or can have a formal plan which is properly documented in writing
43
The nature of HR plan is also depended upon the flexibility that is practiced in the
organization. HR plan should have the ability to anticipate and deal with
contingencies. Organizations frame HRP in such a way that it can contain many
contingencies, which reflect different scenarios thereby assuring that the plan is
flexible and adaptable.
2. Organizational Growth Cycles and Planning: All organizations pass
through different stages of growth from the day of its inception. The stage of growth
in which an organization is determines the nature and extends of HRP. Small
organizations in the earlier stages of growth may not have well defined personnel
planning. But as the organization enters the growth stage they feel the need to plan
its human resource. At this stage organization gives emphasis upon employee
development. But as the organization reaches the mature stage it experience less
flexibility and variability resulting in low growth rate. HR planning becomes more
formalized and less flexible and less innovative and problem like retirement and
possible retrenchment dominate planning. During the declining stage of the
organization HRP takes a different focus like pl anning to do the layoff,
retrenchment and retirement. In declining situation planning always becomes
reactive in nature towards the financial and sales distress faced by the company.
3. Environmental Uncertainties: Political, social and economic changes
affect all organizations and the fluctuations that are happening in these
environments affect organizations drastically. Personnel planners deal with such
environmental uncertainties by carefully formulating recruitment, selection,
training and development policies and programmes. The balance in the organization
is achieved through careful succession planning, promotion channels, layoffs, flexi
time, job sharing, retirement, VRS and other personnel related arrangements.
4. Time Horizons: HR plans can be short term or long term. Short term plans
spans from six months to one year, while long term plans spread over three to
twenty years. The extent of time period depends upon the degree of uncertainty that
is prevailing in an organizations environment. Greater the uncertainty, shorter the
plan time horizon and vice versa.
5. Type and Quality of information: The information used to forecast
personnel needs originates from a multitude of sources. The forecast depends to a
large extent upon the ty pe of information and the quality of data that is available to
personnel planners. The quality and accuracy of information depend upon the
clarity with which the organizational decision makers have defined their strategy,
structure, budgets, production schedule and so on.
6. Nature of Jobs Being Filled: Personnel planners need to be really careful
with respect to the nature of the jobs being filled in the organization. Employees
belonging to lower level who need very limited skills can be recruited hastily but,
while hiring employees for higher posts, selection and recruitment need to be
carried out with high discretion. Organization need to anticipate vacancies far in
advance as possible, to provide sufficient time to recruit suitable candidate.
44
7. Outsourcing: Several organizations outsource part of their work to outside
parties in the form of subcontract. Outsourcing is a regular feature both in the
public sector as well as in the private sector companies. Many of the organizations
have surplus labour and hence instead of hiring more people they go for
outsourcing. Outsourcing is usually done for non critical activities. Outsourcing of
non- critical activities through subcontracting determines HRP.
HRP Process
HRP effectively involves forecasting personnel needs, assessing personnel
supply and matching demand supply factors through personnel related
programmes. The HR planning process is influenced by overall organizational
objectives and environment of business. Environmental Scanning: It refers to the
systematic monitoring of the external forces influencing the organization. The
following forces are essential for pertinent HRP.
Economic factors, including general and regional conditions.
Technological changes
Demographic changes including age, composition and literacy,
Political and legislative issues, including laws and administrative rulings
Social concerns, including child care, educational facilities and priorities.
By scanning the environment for changes that will affect an organization,
managers can anticipate their impact and make adjustments early.
Organizational Objectives and Policies: HR plan is usually derived from the
organizational objectives. Specific requirements in terms of number and
characteristics of employees should be derived from organizational objectives once
the organizational objectives are specified, communicated and understood by all
concerned, the HR department must specify its objective with regard to HR
utilization in the organization.
HR Demand Forecast: Demand forecasting is the process of estimating the
future quantity and quality of people required to meet the future needs of the
organization. Annual budget and long-term corporate plan when translated into
activity into activity form the basis for HR forecast.
For eg: in the case of a manufacturing company, the sales budget will form the
basis for production plan giving the number and type of products to be produced in
each period. This will form the basis upon which the organization will decide the
number of hours to be worked by each skilled category of workers. Once the
number hours required is available organization can determine the quality and
quantity of personnel required for the task.
Demand forecasting is influenced by both internal factors and external factors:
external factors include competition, economic climate, laws and regulatory bodies,
changes in technology and social factors whereas internal factors are budget
constraints, production level, new products and services, organizational structure
45
and employee separations. Demand forecasting is essential because it helps the
organization to,
1. Quantify the jobs, necessary for producing a given number of goods,
2. To determine the nature of staff mix required in the future,
3. To assess appropriate levels in different parts of organ ization so as to avoid
unnecessary costs to the organization,
4. To prevent shortages of personnel where and when, they are needed by the
organization.
5. To monitor compliances with legal requirements with regard to reservation of
jobs.
Techniques like managerial judgment, ratio- trend analysis, regression
analysis, work study techniques, Delphi techniques are some of the major methods
used by the organization for demand forecasting.
HR Supply Forecast
Supply forecast determines whether the HR department will be able to procure
the required number of workers. Su pply forecast measures the number of people
likely to be available from within and outside an organization, after making
allowance for absenteeism, internal movements and promotions, wastage and
changes in hours, and other conditions of work. Su pply forecast is required
because it is needed as it
1. Helps to quantify the number of people and positions expected to be
available in future to help the organization realize its plans and meet its
objectives
2. Helps to clarify the staff mixes that will arise in future
3. It assesses existing staffing in different parts of the organization.
4. It will enable the organization to prevent shortage of people where and when
they are most needed.
5. It also helps to monitor future compliance with legal requirements of job
reservations.
Supply analysis covers the existing human resources, internal sources of
supply and external sources of supply.
HR Programming
Once an organizations personnel demand and supply are forecasted the
demand and supply need to be balanced in order that the vacancies can be filled by
the right employees at the right time.
HR Plan Implementation
HR implementation requires converting an HR plan into action. A series of
action are initiated as a part of HR plan implementation. Programmes such as
recruitment, selection and placement, training and development, retraining and
46
redeployment, retention plan, succession plan etc when clubbed together form the
implementation part of the HR plan.
Control and Evaluation
Control and evaluation represent the final phase of the HRP process. All HR
plan include budgets, targets and standards. The achievement of the organization
will be evaluated and monitored against the plan. During this final phase
organization will be evaluating on the number of people employed against the
established (both those who are in the post and those who are in pipe line) and on
the number recruited against the recruitment targets. Evaluation is also done with
respect to employment cost against the budget and wastage accrued so that
corrective action can be taken in future.
BARRIERS TO HRP
Human Resource Planners face significant barriers while formulating an HRP.
The major barriers are elaborated below:
1. HR practitioners are perceived as experts in handling personnel matters, but
are not experts in managing business. The personnel plan conceived and
formulated by the HR practitioners when enmeshed with organizational
plan, might make the overall strategic plan of the organization ineffective.
2. HR information often is incompatible with other information used in strategy
formulation.
3. Strategic planning efforts have long been oriented towards financial
forecasting, often to the exclusion of other types of information. Financial
forecasting takes precedence over HRP.
4. Conflict may exist between short term and long term HR needs. For example,
there can be a Conflict between the pressure to get the work done on time
and long term needs, such as preparing people for assuming greater
responsibilities. Many managers are of the belief that HR needs can be met
immediately because skills are available on the market as long as wages and
salaries are competitive. Therefore, long times plans are not required, short
planning are only needed.
5. There is conflict between quantitative and qualitative approaches to HRP.
Some people view HRP as a number game designed to track the flow of
people across the department. Others take a qualitative approach and focus
on individual employee concerns such as promotion and career
Development. Best result can be achieved if there is a balance between the
quantitative and qualitative approaches.
6. Non-involvement of operating managers renders HRP ineffective. HRP is not
strictly an HR Department function. Successful planning needs a co-
ordinate effort on the part of operating managers and HR personnel.
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5.4 REVISION POINTS
1. HRP is concerned with two things: Planning of manpower requirements and
Planning of Manpower supplies
2. HRP is the subsystem in the total organizational planning. Organizational
planning includes managerial activities that set the companys objective for
the future and determines the appropriate means for achieving those
objectives.
3. HRP is influenced by several factors. The most important of the factors that
affect HRP are (1) type and strategy of organization (2) organizational growth
cycles and planning (3) environmental uncertainties (4)time horizons (5) type
and quality of forecasting information (4) nature of jobs being filled and (5)
off loading the work.
4. Human Resource Planners face significant barriers while formulating an
HRP
1. Explain the role of HR professional in human resource planning process in
organizations.
2. Describe the various forecasting techniques and how these techniques are
being used in Human resource planning.
3. Explain the barriers to HRP. Bring out the requisites for effective planning.
5.6 SUMMARY
Today, human resource planning is viewed as the way management comes to
grasp the ill-defined and tough-to-solve human resource problems facing an
organization. Human resource planning is the process of determining the human
resources required by the organization to achieve its goals. Human resource
planning also looks at broader issues relating to the ways in which people are
employed and developed, in order to improve organizational effectiveness. HRP is a
decision making process that combines activities such as identifying and acquiring
the right number of people with the proper skills, motivating them to achieve high
performance and creating interactive links between business objectives are
resource planning activities. HRP sets out requirements in both quantitative and
qualitative terms. Accurate manpower plan is a dream. A common error of many
managers is to focus on the organizations short term replacement needs. Any
human resource plan, if it is to be effective, must be derived from the long term
plans and strategies of the organization. The various approaches to human
resource planning under which a number of major issues and trends in todays
work plan that will affect organization and employees are (1) Examine external and
internal issues, (2) Determining future organizations capabilities, (3) Determining
future organizational needs, and (4) Implementing human resources programmes to
address anticipated problems. Although change is occurring very rapidly in the
48
work world it is important for both organizations and employees to monitor issues
and events continuously and consider their potential effects.
Fill in the blanks
1. __________ is the subsystem in the total organizational planning.
2. Greater the uncertainty, shorter the ___________ and vice versa.
3. __________ is a regular feature both in the public sector as well as in the
private sector companies.
4. Systematic monitoring of the external forces influencing the organization is
_________.
5. The process of estimating the future quantity and quality of people required
to meet the future needs of the organization is ____________.
1. Managing Human Resources - Weihgtman, Jane
2. Successful Managing The Team - Marching, Mick
5.9 ASSIGNMENTS
1. How HRP takes place in Business Organization ? Explain in your own words
with appropriate examples.
1. Lloyd L. Byars and Leslie W. Rue (1997), Human Resource Management
(5th edition), The McGraw-Hill Companies, USA.
2. Michael Armstrong (1999), A Handbook of Human Resource Management
Practice (7th edition), Kogan Page Limited, 120 Pentonvelle Road, London.
3. Biswajeet Pattanayak (2001), Human Resource Management, Prentice Hall of
India Pvt. Ltd., New Delhi.
4. K. Aswathappa (1999), Human Resource and Personnel Management
(2nd edition), Tata McGraw-Hill Publishing Company Ltd., New Delhi.
5. P. Subba Rao (2004), Management and Organizational Behaviour
(First edition), Himalaya Publishing House.
Case study
A small firm had about 12 supervisors reporting to different managers.
Working hours were 9 A.M to 5 P.M. Mr. Ramesh, who is considered to be a tough
guy, is a committed supervisor. On one morning, he noticed that two of his senior
workers were about ten minutes late to work and some of the junior workers were
coming late by 15 minutes. He circulated a memo among all his employees
informing that all of them should be punctual. The next morning he observed that
all employees were present at work spot sharp by 9 A.M. He thought that his
decision seems to be effective.
49
One afternoon, he called on one of his workers at about 4.30 P.M. and
discussing the details of next days production schedule. At 4.55 P.M., the worker
stopped listening and gently remained the supervisor that the days work is over by
5 P.M. Most of the workers started leaving the premises by 5 P.M. even without
clearing the job on hand.
Questions
1. How effective was the supervisors decision?
2. Had he considered all the alternatives and consequences?
3. If you were being in his position, what would you have been done?
5.12 KEYWORDS
Strategic, Problems, Barriers, Planning, Professional

50
LESSON 6
RECRUITMENT
6.1 INTRODUCTION
Successful human resource planning should identify our human resource
needs. Once we know these needs, we will want to do something about meeting
them. The next step in the acquisition function, the refore, is recruitment. This
activity makes it possible for us to acquire the number and types of people
necessary to ensure the continued operation of the organization. Hallett says, It is
with people that quality performance really begins and ends. Robert Heller also
says, If people of poor caliber are hired, nothing much else can be accomplished
and Greshams law will work: the bad people will drive out the good or cause them
to deteriorate. Recruiting is the discovering of potential candidates for actual or
anticipated organizational vacancies. Or, from another perspective, it is a linking
activity-bringing together those with jobs to fill and those seeking jobs.
6.2 OBJECTIVES
Define recruitment.
Cite the steps in recruitment process.
Understand the prerequisites of a good recruitment policy.
Describe the various sources of recruitment.
Understand the methods through which prospective candidates may be
recruited.
Point out the various factors affecting recruitment.
6.3 CONTENTS
6.3.1 Meaning
6.3.2 Factors Influencing Recruitment
6.3.3 Recruitment Policy
6.3.4 Sources of Recruitment
6.3.1 Meaning
Recruitment: Meaning and Definition
Recruitment forms a step in the process which continues with selection and
ceases with the placement of the candidate. It is the next step in the procurement
function, the first being the manpower planning. Recruiting makes it possible to
acquire the number and types of people necessary to ensure the continued
operation of the organization. Recruiting is the discovering of potential applicants
for actual or anticipated organizational vacancies.
According to Edwin B. Flippo, Recruitment is the process of searching for
prospective employees and stimulating them to apply for jobs in the organization.
51
According to Lord, Recruitment is a form of competition. Just as
corporations compete to develop, manufacture, and market the best product or
service, so they must also compete to identify, attract and hire the most qualified
people. Recruitment is a business, and it is a big business.
According to Scott, Clothier and Spriegel the need for recruitment arises
out of the following situations:
Vacancies created due to expansion, diversification, and growth of business.
An increase in the competitive advantage of certain concerns, enabling them
to get more of the available business than formerly.
An increase in business arising from an upswing during the recovery period
of a business cycle. Vacancies created due to transfer, promotion,
retirement, termination, permanent disability or death.
The normal population growth, which requires increased goods and services
to meet the needs of the people.
A rising standard of living, which requires more of the same goods and
services as well as the creation of new wants to be satisfied.
6.3.2 Factors Influencing Recruitment
Factor Affecting Recruitment
The factors affecting recruitment can be classified as internal and external
factors.
The internal factors are:
Wage and salary policies;
The age composition of existing working force;
Promotion and retirement policies;
Turnover rates;
The nature of operations involved the kind of personnel required;
The level and seasonality of operations in question;
Future expansion and reduction programmes;
Recruiting policy of the organization;
Human resource planning strategy of the company;
Size of the organization and the number of employees employed;
Cost involved in recruiting employees, and finally;
Growth and expansion plans of the organization.
The external factors are:
Supply and demand of specific skills in the labour market;
Companys image perception of the job seekers about the company.
52
External cultural factors: Obviously, the culture may exert considerable
check on recruitment. For example, women may not be recruited in certain
jobs in industry.
Economic factors: such as a tight or loose labour market, the reputation of
the enterprise in the community as a good pay master or otherwise and such
allied issues which determine the quality and quantity of manpower
submitting itself for recruitment.
Political and legal factors also exert restraints in respect of nature and hours
of work for women and children, and allied employment practices in the
enterprise, reservation of Job for SC, ST and so on.
6.3.3 Recruitment Policy
As Yoder et al observe recruitment policy spells out the objectives of the
recruitment and provides a framework for implementations of the recruitment
programme in the form of procedures. It may involve a commitment to broad
principles such as filling vacancies with the best qualified individuals. The
recruitment policy may embrace several issues such as the extent of promotion
from within, attitudes of enterprise in recruiting old, handicapped, and minor
individuals, minority group members, part-time employees and relatives of present
employees. In addition, the recruitment policy may also involve the organisation
system to be developed for implementing the recruitment programme and
procedures to be employed. Explicitly, an organisational system is a function of the
size of an enterprise. In smaller enterprises, there may be merely informal
recruiting procedures and the line official may be responsible to handle this
function along with their usual responsibilities. On the other hand, in larger
organisations, there is usually a staff unit attached with personnel or an industrial
relations department designated as employment or recruitment office. This
specialization of recruitment enables staff personnel to become highly skilled in
recruitment techniques and their evaluation. However, recruitment remains the line
responsibility as far as the personnel requisition forms are originated by the line
personnel, who have also the final word in the acceptance or rejection of a
particular applicant. Despite this, the staff personnel have adequate freedom in
respect of sources of manpower to be tapped and the procedure to be followed for
this purpose.
Recruitment policy covers the following areas:
To prescribe the degree of emphasis. Inside the organization or outside the
organization.
To provide the weightage that would be given to certain categ ories of people
such as local population, physically-handicapped personnel, personnel from
scheduled castes/tribes and other backward classes.
To prescribe whether the recruitment would be centralized or decentralized
at unit levels.
53
To specify the degree of flexibility with regard to age, qualifications,
compensation structure and other service conditions.
To prescribe the personnel who would be involved in recruitment process
and the role of human resource department in this regard.
To specify the budget for meeting the expenditures incurred in completing
the recruitment process.
According to Yoder, the recruitment policy is concerned with quantity and
qualifications of manpower. It establishes broad guidelines for the staffing process.
Generally, the following factors are involved in a recruitment policy:
To provide each employee with an open road and encouragement in the
continuing development of his talents and skills;
To avoid cliques which may develop when several members of the same
household or community are employed in the organisation;
To carefully observe the letter and spirit of the relevant public policy on
hiring and, on the whole, employment relationship;
To assure each employee of the organisation interest in his personal goals
and employment objective;
To assure employees of fairness in all employment relationships, including
promotions and transfers;
To provide employment in jobs which are engineered to meet the
qualifications of handicapped workers and minority sections; and
To encourage one or more strong, effective, responsible trade unions among
the employees.
Prerequisites of a Good Recruitment Policy
The recruitment policy of an organization must satisfy the following conditions:
It should be in conformity with its general personnel policies;
It should be flexible enough to meet the changing needs of an organization;
It should be so designed as to ensure employment opportunities for its
employees on a long-term basis so that the goals of the organization should
be achievable; and it should develop the potentialities of employees;
It should highlight the necessity of establishing job analysis.
Problems in Recruitment
The traditional philosophy is to get as many people as possible to apply for
the job. As a result of this, a large number of job seekers apply for the job,
which makes the final selection process difficult and can often result in the
selection of wrong candidates. Wrong selection can, in turn, lead to
employee dissatisfaction and turnover in the long run.
54
In realistic philosophy, the needs of the organization are matched with the
needs of the applicants, which enhance the effectiveness of the recruitment
process. In realistic approach, the employees who are recruited will stay in
the organization for a longer period of time and will perform at higher level of
effectiveness.
6.3.4 Sources of Recruitment
Sources of Recruitment
After the finalization of recruitment plan indicating the number and type of
prospective candidates, they must be attracted to offer themselves for consideration
to their employment. This necessitates the identification of sources from which
these candidates can be attracted. Some companies try to develop new sources,
while most only try to tackle the existing sources they have. These sources,
accordingly, may be termed as internal and external.
Internal Sources
It would be desirable to utilize the internal sources before going outside to
attract the candidates. Yoder and others suggest two categories of internal sources
including a review of the present employees and nomination of candidates by
employees. Effective utilisation of internal sources necessitates an understanding of
their skills and information regarding relationships of jobs. This will provide
possibilities for horizontal and vertical transfers within the enterprise eliminating
simultaneous attempts to lay off employees in one department and recruitment of
employees with similar qualification for another department in the company.
Promotion and transfers within the plant where an employee is best suitable
improves the morale along with solving recruitment problems. These measures can
be taken effectively if the company has established job families through job analysis
programmes combining together similar jobs demanding similar employee
characteristics. Again, employees can be requested to suggest promising
candidates. Sometimes, employees are given prizes for recommending a candidate
who has been recruited. Despite the usefulness of this system in the form of loyalty
and its wide practice, it has been pointed out that it gives rise to cliques posing
difficulty to management. Therefore, before utilising this system attempts should be
made to determine through research whether or not employees thus recruited are
effective on particular jobs. Usually, internal sources can be used effectively if the
numbers of vacancies are not very large, adequate, employee records are
maintained, jobs do not demand originality lacking in the internal sources, and
employees have prepared themselves for promotion s.
Merits of Internal Sources
The following are the merits of internal sources of recruitment:
It creates a sense of security among employees when they are assured that
they would be preferred in filling up vacancies.
It improves the morale of employees, for they are assured of the fact that
they would be preferred over outsiders when vacancies occur.
55
It promotes loyalty and commitment among employees due to sense of job
security and opportunities for advancement.
The employer is in a better position to evaluate those presently employed
than outside candidates. This is because the company maintains a record of
the progress, experience and service of its employees.
Time and costs of training will be low because employees remain familiar
with the organization and its policies. Relations with trade unions remain
good. Labour turnover is reduced. As the persons in the employment of the
company are fully aware of, and well acquainted wit, its policies and know
its operating procedures, they require little trainin g, and the chances are
that they would stay longer in the employment of the organization than a
new outsider would.
It encourages self-development among the employees. It encourages good
individuals who are ambitious.
It encourages stability from continuity of employment.
It can also act as a training device for developing middle and top-level
managers.
Demerits of Internal Sources: However, this system suffers from certain
defects as:
There are possibilities that internal sources may dry up, and it may be
difficult to find the requisite personnel from within an organization.
It often leads to inbreeding, and discourages new blood from entering and
organization.
As promotion is based on seniority, the danger is that really capable hands
may not be chosen. The likes and dislikes of the management may also play
an important role in the selection of personnel.
Since the learner does not know more than the lecturer, no innovations
worth the name can be made. Therefore, on jobs which require original
thinking (such as advertising, style, designing and basic research), this
practice is not followed.
This source is used by many organizations; but a surprisingly large number
ignore this source, especially for middle management jobs.
External Sources
DeCenzo and Robbins remark, Occasionally, it may be necessary to bring in
some new blood to broaden the present ideas, knowledge, and enthusiasm. Thus,
all organisations have to depend on external sources of recruitment.
Among these sources are included:
Employment agencies.
Educational and technical institutes. and
Casual labour or applicants at the gate and nail applicants.
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Public and private employment agencies play a vital role in making available
suitable employees for different positions in the organisations. Besides public
agencies, private agencies have developed markedly in large cities in the form of
consultancy services. Usually, these agencies facilitate recruitment of technical and
professional personnel. Because of their specialisation, they effectively assess the
needs of their clients and aptitudes and skills of the specialised personnel. They do
not merely bring an employer and an employee together but computerise lists of
available talents, utilising testing to classify and assess applicants and use
advanced techniques of vocational guidance for effective placement purposes.
Educational and technical institutes also form an effective source of manpower
supply. There is an increasing emphasis on recruiting student from different
management institutes and universities commerce and management departments
by recruiters for positions in sales, accounting, finance, personnel and production.
These students are recruited as management trainees and then placed in special
company training programmes. They are not recruited for particular positions but
for development as future supervisors and executives. Indeed, this source provides
a constant flow of new personnel with leadership potentialities.
Frequently, this source is tapped through on -campus interview with promising
students. In addition, vocational schools and industrial training institutes provide
specialised employees, apprentices, and trainees for semiskilled and skilled jobs.
Persons trained in these schools and institutes can be placed on operative and
similar jobs with a minimum of in-plant training. However, recruitment of these
candidates must be based on realistic and differential standards established
through research reducing turnover and enhancing productivity. Frequently,
numerous enterprises depend to some extent upon casual labour or applicants at
the gate and nail applicants. The candidates may appear personally at the
companys employment office or send their applications for possible vacancies.
Explicitly, as Yoder and others observe, the quality and quantity of such candidates
depend on the image of the company in community. Prompt response to these
applicants proves very useful for the company.
However, it may be noted that this source is uncertain, and the applicants
reveal a wide range of abilities necessitating a careful screening. Despite these
limitations, it forms a highly inexpensive source as the candidates themselves come
to the gate of the company. Again, it provides measures for good public relations
and accordingly, all the candidates visiting the company must be received cordially.
As Jucius observes, trade unions are playing an increasingly important role in
labour supply. In several trades, they supply skilled labour in sufficient numbers.
They also determine the order in which employees are to be recruited in the
organisation. In industries where they do not take active part in recruitment, they
make it a point that employees laid off are given preference in recruitment.
Application files also forms a useful source of supply of work force. Attempts may
be made to review the application to determine jobs for which the candidates filed
for future use when there are openings in these jobs. The candidates may be
57
requested to renew their cards as many times as they de sire. All the renewed cards
may be placed in active files and those not renewed for considerable time may be
placed in inactive file or destroyed. Indeed, a well-indexed application file provides
utmost economy from the standpoint of a recruiting budge t. Efficacy of alternative
sources of supply of human resources should be determined through research.
Attempts may be made to relate the factor of success on the job with a specific
source of supply. Alternative sources can also be evaluated in terms of turnover,
grievances and disciplinary action. Those sources which are significantly positively
related with job performance and significantly negatively related with turnover,
grievances and disciplinary action, can be effectively used in recruitment
programmes. The assessment should be periodically performed in terms of
occupations. It may be that source A is most effective for technical workers, while
source B for semiskilled workers.
Advantages of External Recruitment
External sources of recruitment are suitable for the following reasons:
It will help in bringing new ideas, better techniques and improved methods
to the organization.
The cost of employees will be minimized because candidates selected in this
method will be placed in the minimum pay scale.
The existing employees will also broaden their personality.
The entry of qualitative persons from outside will be in the interest of the
organisation in the long run.
The suitable candidates with skill, talent, knowledge are available from
external sources.
The entry of new persons with varied expansion and talent will help in
human resource mix.
Disadvantages of External Sources
Orientation and training are required as the employees remain unfamiliar
with the organization.
It is more expensive and time-consuming. Detailed screening is necessary as
very little is known about the candidate.
If new entrant fails to adjust himself to the working in the enterprise, it
means yet more expenditure on looking for his replacement.
Motivation, morale and loyalty of existing staff are affected, if higher level
jobs are filled from external sources.
It becomes a source of heart- burning and demoralization among existing
employees.
58
Methods of Recruitment
Methods of recruitment are different from the sources of recruitment. Sources
are the locations where prospective employees are available. On the other hand,
methods are way of establishing links with the prospective employees. Various
methods employed for recruiting employees may be classified into the following
categories:
1. Direct Methods
These include sending recruiters to educational and professional institutions,
employees, contacts with public, and manned exhibits. One of the widely used
direct methods is that of sending of recruiters to colleges and technical schools.
Most college recruiting is done in co-operation with the placement office of a college.
The placement office usually provides help in attracting students, arranging
interviews, furnishing space, and providing student resumes. For managerial,
professional and sales personnel campus recruiting is an extensive operation.
Persons reading for MBA or other technical diplomas are picked up in this manner.
For this purpose, carefully prepared brochures, describing the organization
and the jobs it offers, are distributed among students, before the interviewer
arrives. Sometimes, firms directly solicit information from the concerned professors
about students with an outstanding record. Many companies have found employees
contact with the public a very effective method. Other direct methods include
sending recruiters to conventions and seminars, setting up exhibits at fairs, and
using mobile offices to go to the desired centres.
2. Indirect Methods
The most frequently used indirect method of recruitment is advertisement in
newspapers, journals, and on the radio and television. Advertisement enables
candidates to assess their suitability. It is appropriate when the organization wants
to reach out to a large target group scattered nationwide. When a firm wants to
conceal its identity, it can give blind advertisement in which only box number is
given. Considerable details about jobs and qualifications can be given in the
advertisements. Another method of advertising is a notice -board placed at the gate
of the company.
3. Third-Party Methods
The most frequently used third-party methods are public and private
employment agencies. Public employment exchanges have been largely concerned
with factory workers and clerical jobs. They al so provide help in recruiting
professional employees. Private agencies provide consultancy services and charge a
fee. They are usually specialized for different categories of operatives, office workers,
salesmen, supervisory and management personnel. Other third-party methods
include the use of trade unions. Labour management committees have usually
demonstrated the effectiveness of trade unions as methods of recruitment.
Several criteria discussed in the preceding section for evaluating sources of
applicants can also be used for assessing recruiting methods. Attempts should be
59
made to identify how the candidate was attracted to the company. To accomplish
this, the application may consist of an item as to how the applicant came to learn
about the vacancy. Then, attempts should be made to determine the method which
consistently attracts good candidates. Thus, the most effective method should be
utilized to improve the recruitment programme.
6.4 REVISION POINTS
1. Recruitment is the process of searching for prospe ctive employees and
stimulating them to apply for jobs in the organization
2. The factors affecting recruitment can be classified as internal and external
factors.
3. The recruitment policy is concerned with quantity and qualifications of
manpower. It establishes broad guidelines for the staffing process
4. Sources of Recruitment- internal and external
5. Methods of recruitment -Direct Methods, Indirect Methods, Third-Party Methods.
1. Define recruitment and identify the various factors which affect recruitment.
2. Discuss the steps of recruitment process. How will you reconcile the internal
and external sources of recruitment?
3. Discuss various sources of recruitment.
4. Write short notes on following.
Advantages and disadvantages of internal sources of recruitment.
Advantages and disadvantages of external source of recruitment.
6.6 SUMMARY
Recruitment forms a step in the process which continues with selection and
ceases with the placement of the candidate. It is the next step in the procurement
function, the first being the manpower planning. Recruiting makes it possible to
acquire the number and types of people necessary to ensure the continued
operation of the organisation. Thus, recruitment process is concerned with the
identification of possible sources of human resource supply and tapping those
sources.
Recruitment process involves five elements, viz., a recruitment policy, a
recruitment organization, the development of sources of recruitment, and different
techniques used for utilizing these sources, and a method of assessing the
recruitment programme. After the finalization of recruitment plan indicating the
number and type of prospective candidates, they must be attracted to offer
themselves for consideration to their employment. This necessitates the
identification of sources from which these candidates can be attracted.
Some companies try to develop new sources, while most only try to tackle the
existing sources they have. These sources, accordingly, may be termed as internal
and external. Methods of recruitment are different from the sources of recruitment.
60
Sources are the locations where prospective employees are available. On the other
hand, methods are way of establishing links with the prospective employees.
Various methods employed for recrui ting employees may be classified into direct
methods, indirect methods and third party methods.
Fill in the blanks:
1. The process of searching for prospective employees and stimulating them to
apply for jobs in the organization is called _________.
2. The factors affecting recruitment can be classified as __________ and
__________ factors.
3. The most frequently used ____________ method of recruitment is
advertisement in newspaper, journals, radio and television.
4. The way of establishing links with the prospective employees are called
___________.
5. The most frequently used third-party method of recruitment are public and
private ____ agencies.
1. Mamoria C.B., Gankar S.V., (2006), A Textbook of Human Resource
Management, Himalaya Publishing House, New Delhi.
2. Dwivedi R.S., (1997), Personnel Management in Indian Enterprises,
Galgotia Publishing Company, New Delhi.
3. Devid A. Decenzo, Stephen P. Robbins (2002), Personnel/Human Resource
Management, Prentice Hall of India, New Delhi.
6.9 ASSIGNMENTS
1. In your own words explain methods of recruitment
2. Bring out the Merits and Demerits of internal source of Recruitment
1. Prasad L.M., (2005), Human Resource Management, Sultan Chand & Sons
New Delhi.
2. Dessler Gary (2010), Personnel Management, Prentice Hall International
Editions, New Jersey.
3. Carrell Michael R., Elbert Norbert F., Hatfield Robert D. (1999), Human
Resource Management, Prentice Hall, Englewood Cliffs, New Jersey.
1. Explain the indirect method of recruitment in corporate sector.
6.12 KEYWORDS
Internal, External, Source, Advantage, Disadvantage, Methods.

61
LESSON 7
SELECTION
7.1 INTRODUCTION
Human resource selection is the process of choosing qualified individuals who
are available to fill positions in an organization. In the ideal personnel situation,
selection involves choosing the best applicant to fill a position. Selection is the
process of choosing people by obtaining and assessing information about the
applicants with a view to matching these with the job requirements. It involves a
careful screening and testing of candidates who have put in their applications for
any job in the enterprise. It is the process of choosing the most suitable persons out
of all the applicants.
The purpose of selection is to pick up the right person for every job. It can be
conceptualized in terms of either choosing the fit candidates, or rejecting the unfit
candidates, or a combination of both. Selection involves both because it picks up
the fits and rejects the benefits. In fact, in Indian context, there are more
candidates who are rejected than those who are selected in most of the selection
processes. Therefore, sometimes, it is called a negative process in contrast to
positive programme of recruitment.
7.2 OBJECTIVES
To point out the outcomes of selection decision.
To understand in brief about placement and orientation.
To develop a selection decision process.
7.3 CONTENTS
7.3.1 Meaning
7.3.2 Importance of Selection
7.3.3 Selection Policy
7.3.4 Steps in Selection Process
7.3.1 Meaning
According 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.
According to Thomas Stone, Selection is the process of differentiating
between applicants in order to identify (and hire) those with a greater likelihood of
success in a job.
In the words of Michael Jucius, The selection procedure is the system of
functions and devices adopted in a given company for the purpose of ascertaining
whether or not candidates possess the qualifications called for by a specific job or
for progression through a series of jobs.
62
According to Keith Davis, Selection is the process by which an organization
chooses from a list of screened applicants, the person or persons who best meet the
selection criteria for the position available. Thus, the selection process is a tool in
the hands of management to differentiate between the qualified and unqualified
applicants by applying various techniques such as interviews, tests etc. The cost
incurred in recruiting and selecting any new employee is expensive. The cost of
selecting people who are inadequate performers or who leave the organization
before contributing to profits proves a major cost of doing business. DeCenzo and
Robbins write, Proper selection of personnel is obviously an area where
effectiveness - choosing competent workers who perform well in their position -can
result in large saving. According to them, selection has two objectives: (1) to
predict which job applicants would be successful if hired and (2) to inform and sell
the candidate on the job and the organization. Satisfaction of employee needs and
wants as well as the fullest development of his potential are important objectives of
selection.
Dale Yoder says, Selection has long held a high rank in the priority of
problem areas in management. Investments in good people produce a very high rate
of return. A good choice of people can provide a basis for long, sustained
contributions.
7.3.2 Importance of Selection
Various steps of selection process includin g selection tests are meant to solicit
information about the candidates so as to arrive at a decision to select the most
desirable candidates out of the several available. Since only some information is
available from other sources like application forms, references, etc., selection tests
are used to solicit more information about the candidates.
Therefore, the use of selection tests has many advantages:
1. Selection tests are standardized and unbiased methods of soliciting
information about the prospective employees. Thus, a person who does not get
selected on the basis of selection tests cannot argue for the partiality in selection
process. It is to be noted that in many organizations, impartiality in selection
process is of prime importance like public se ctor organizations.
2. Selection tests can be used to weed out the large number of candidates who
may not be considered for employment in the organization. Normally, organizations
receive applications from large number of candidates seeking jobs in the
organization. They all meet the basic requirements of the jobs, but all cannot be
called for interview because it is a very time-consuming process. Selection tests will
provide the cutoff point above which candidates can be called for interview. Thus,
the tests will save lot of time and money.
3. The tests are able to uncover the qualities and potentials of prospective
employees, which cannot be known by other methods including personal interview.
Since the people are taken in the organization not only for the present jobs but they
are promoted over the period of time, tests provide good opportunities to test their
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potentials for such promotions also. Thus, tests are more reliable source for
predicting the overall suitability of candidates for the employment.
7.3.3 Selection Policy
The selection process refers to the steps involved in choosing someone who
has the right qualifications to fill a current or future job opening.
There are five main steps in the selection process. First, criteria are developed
to determine how the person will be chosen. Second is a review of the applications
and rsums, often done via a computer program that can find keywords. Next is
interviewing the employee. The last steps involve testing, such as a personality test
or drug test, and then finally, making the offer to the right candidate.
7.3.4 Steps in Selection Process
The selection procedure is concerned with securing relevant information about
an applicant. This information is secured in a number of steps or stages. The
objective of selection process is to determine whether an applicant meets the
qualification for a specific job and to choose the applicant who is most likely to
perform well in that job. Selection is a long process, commencing from the
preliminary interview of the applicants and ending with the contract of employment
(sometimes). The selection procedure consists of a series of steps. Each step must
be successfully cleared before the applicant proceeds to the next. The selection
process is a series of successive hurdles or barriers which an applicant must cross.
These hurdles are designed to eliminate an unqualified candidate at any point in
the selection process. Thus, this technique is called Successive Hurdles
Technique. In practice, the process differs among organizations and between two
different jobs within the same organization. Selection procedure for the senior
managers will be long drawn and rigorous, but it is simple and short while hiring
lower level employees.
The major factors which determine the steps involved in a selection process are as
follows:
Selection process depends on the number of candidates that are available for
selection.
Selection process depends on the sources of recruitment and the method
that is adopted for making contact with the prospective candidates.
Various steps involved in as selection process depend on the type of
personnel to be selected. All the above factors are not mutually exclusive,
rather these operate simultaneously. In any case, the basic objective of a
selection process is to collect as much relevant information about the
candidates as is possible so that the most suitable candidates are selected. A
comprehensive selection process involves the various steps as shown below
1. Application Pool: Application pool built-up through recruitment process is
the base for selection process. The basic objective at the recruitment level is to
64
attract as much worthwhile applications as possible so that there are more options
available at the selection stage.
2. Preliminary Screening and Interview: It is highly noneconomic to
administer and handle all the applicants. It is advantageous to sort out unsuitable
applicants before using the further selection steps. For this purpose, usually,
preliminary interviews, application blank lists and short test can be used. All
applications received are scrutinised by the personnel department in order to
eliminate those applicants who do not fulfill required qualifications or work
experience or technical skill, his application will not be entertained. Such candidate
will be informed of his rejection. Preliminary interview is a sorting process in which
the prospective candidates are given the necessary information about the nature of
the job and the organization. Necessary i nformation is obtained from the candidates
about their education, skills, experience, expected salary etc. If the candidate is
found suitable, he is elected for further screening. This courtesy interview; as it is
often called helps the department screen out obvious misfits. Preliminary interview
saves time and efforts of both the company and the candidate. It avoids
unnecessary waiting for the rejected candidates and waste of money on further
processing of an unsuitable candidate. Since rejection rate is high at preliminary
interview, the interviewer should be kind, courteous, receptive and informal.
3. Application Blank or Application F orm: An application blank is a
traditional widely accepted device for getting information from a prospective
applicant which will enable the management to make a proper selection. The
blank provides preliminary information as well as aid in the interview by
indicating areas of interest and discussion. It is a good means of quickly
collecting verifiable (and there fore fairly accurate) basic historical data from the
candidate. It also serves as a convenient device for circulating information about
the applicant to appropriate members of management and as a useful device for
storing information for, later reference. Many ty pes o f application forms,
sometimes very long and comprehensive and sometimes brief, are used.
Information is generally taken on the following items:
(a) Biographical Data: Name, fathers name, data and place of birth, age, sex,
nationality, height, weight, identification marks, physical disability, if any, marital
status, and number of dependants.
(b) Educational Attainment: Education (subjects offered and grades secured),
training acquired in special fields and knowledge gained from professional
/technical institutes or through correspondence courses.
(c) W ork Experience: Previous experience, the number of jobs held with the
same or other employers, including the nature of duties, and responsibilities and
the duration of various assignments, salary received, grades, and reasons for
leaving the present employer.
(d) Salary and Benefits: Present and expected.
65
(e) Other Items: Names and addresses of previous employers, references, etc.
An application blank 1is a brief history sheet of an employees background and can
be used for future reference, in case needed. The application blank must be
designed from the viewpoint of the applicant as well as with the companys purpose
in mind. It should be relatively easy to handle in the employment office. Application
form helps to serve many functions like:
Its main usefulness is to provide information for reference checking, good
interviewing, and correlation with testing data.
It helps to weed out candidates who are lacking in education, experience or
some other eligibility traits.
It helps in formulating questions to be asked in the interview. Data
contained in application form can be stored for future reference.
It also tests the candidates ability to write, to organize his thoughts, and to
present facts clearly and succinctly.
It indicates further whether the applicant has consistently progressed to
better jobs. It provides factual information.
Weighted Application Blanks
Some organizations assign numeric values or weights to the responses
provided by the applicants. This makes the application form more job related.
Generally, the items that have a strong relationship to job performance are given
higher scores. For example, for a sales representatives position, items such as
previous selling experience, area of specialisation, commission earned, religion,
language etc. The total score of each applicant is then obtained by adding the
weights of the individual item responses. The resulting scores are then used in the
final selection. WAB is best suited for jobs where there are many employees
especially for sales and technical jobs. It can help in reducing the employee
turnover later on. However, there are several problems associated with WAB e.g.
It takes time to develop such a form.
The WAB would have to be updated every few years to ensure that the
factors previously identified are still valid products of job success.
The organization should be careful not to depend on weights of a few items
while finally selecting the employee.
4. Selection Tests
Many organizations hold different kinds of selection tests to know more about
the candidates or to reject the candidates who cannot be called for interview etc.
Selection tests normally supplement the information provided in the application
forms. Such forms may contain factual information about candidates. Selection
tests may give information about their aptitude, interest, personality, which cannot
be known by application forms. Types of tests and rules of good of testing have
been discussed in brief below:
66
A. Aptitude Tests: These measure whether an individual has the capacity or
talent ability to learn a given job if given adequate training. These are more useful
for clerical and trade positions.
B. Personality Tests: At times, personality affects job performance. These
determine personality traits of the candidate such as cooperativeness, emotional
balance etc. These seek to assess an individuals motivation, adjustment to the
stresses of everyday life, capacity for interpersonal relations and self-image.
C. Interest Tests: These determine the applicants interests. The applicant is
asked whether he likes, dislikes, or is indifferent to many examples of school
subjects, occupations, amusements, peculiarities of people, and particular
activities.
D. Performance Tests: In this test the applicant is asked to demonstrate his
ability to do the job. For example, prospective typists are asked to type several
pages with speed and accuracy.
E. Intelligence Tests: This aim at testing the mental capacity of a person with
respect to reasoning, word fluency, numbers, memory, comprehension, picture
arrangement, etc. It measures the ability to grasp, understand and to make
judgement.
F. Knowledge Tests: These are devised to measure the depth of the knowledge
and proficiency in certain skills already achieved by the applicants such as
engineering, accounting etc.
G. Achievement Tests: Whereas aptitude is a capacity to learn in the future,
achievement is concerned with what one has accomplished. When applicants claim
to know something, an achievement test is given to measure how well they know it.
H. Projective Tests: In these tests the applicant projects his personality into
free responses about pictures shown to him which are ambiguous.
Rules of Good Testing
Norms should be developed for each test. Their validity and reliability for a
given purpose should be established before they are used.
Adequate time and resources must be provided to design , validate, and
check tests.
Tests should be designed and administered only by trained and competent
persons.
The user of tests must be extremely sensitive to the feelings of people about
tests.
Tests are to be uses as a screening device.
Reliance should not be placed solely upon tests in reaching decisions.
Tests should minimize the probabilities of getting distorted results. They
must be race-free.
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Tests scores are not precise measures. They must be assigned a proper
weightage.
Note:
The following selection Process steps were explained detail in upcoming
chapters. For the reader understanding the next five steps are given below briefly.
5. Interview: An interview is a procedure designed to get information from a
person and to assess his potential for the job he is being considered on the basis of
oral responses by the applicant to oral inquiries by the interviewer. Interviewer does
a formal in-depth conversation with the applicant, to evaluate his suitability. It is
one of the most important tools in the selection process. This tool is used when
interviewing skilled, technical, professional and even managerial employees. It
involves two-way exchange of information. The interviewer learns about the
applicant and the candidate learns about the employer.
6. Background Investigation: The next step in the selection process is to
undertake an investigation of those applicants who appear to offer potential as
employees. This may include contacting former employers to confirm the
candidates work record and to obtain their appraisal of his or her performance/
contacting other job-related and personal references, and verifying the educational
accomplishments shown on the application.
The background investigation has major implications. Every personnel
administrator has the responsibility to investigate each potential applicant. In some
organization, failure to do so could result in the loss of his or her job. But many
managers consider the background investigation data highly biased. Who would
actually list a reference that would not give anything but the best possible
recommendation? The seasoned personnel administrator expects this and delves
deeper into the candidates background, but that, too, may not prove to be
beneficial. Many past employers are reluctant to give any information to another
company other than factual information (e.g., date of employment).
Even though there is some reluctance to give this information, there are ways
in which personnel administrators can obtain it. Sometimes, for instance
information can be obtained from references once removed. For example, the
personnel administrator can ask a reference whose name has been provided on the
application form to give another reference, someone who has knowledge of the
candidates work experience. By doing this, the administrator can eliminate the
possibility of accepting an individual based on the employees current employers
glowing recommendation when the motivation for such a positive recommendation
was to get rid of the employee.
7. Physical Examination: After the selection decision and before the job offer
is made, the candidate is required to undergo physical fitness test. Candidates are
sent for physical examination either to the companys physician or to a medical
officer approved for the purpose. Such physical examination provides the following
information.
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Whether the candidates physical measurements are in accordance with job
requirements or not?
Whether the candidate suffers from bad health which should be corrected?
Whether the candidate has health problems or psychological attitudes likely
to interfere with work efficiency or future attendance?
Whether the candidate is physically fit for the specific job or not?
Policy on these physical exams has changed today. Dale Yoder writes,
Modem policy used the physical examination not to eliminate applicants,
but to discover what jobs they are qualified to fill. The examination should
is close the physical characteristics of the individual that are significant
from the standpoint of his efficient performance of the job he may enter or of
those jobs to which he may reasonably expect to be transferred or promoted.
It should note deficiencies, not as a basis for rejection, but as indicating
restrictions on his transfer to various positions also.
8. Approval by Appropriate Authority: On the basis of the above steps,
suitable candidates are recommended for selection by the selection committee or
personnel department. Though such a committee or personnel department may
have authority to select the candidates finally, often it has staff authority to
recommend the candidates for selection to the appropriate authority. Organizations
may designate the various authorities for approval of final selection of candidates
for different categories of candidates. Thus, for top level managers, board of
directors may be approving authority; for lower levels, even functional heads
concerned may be approving authority.
9. Final Employment Decision: After a candidate is finally selected, the
human resource department recommends his name for employment. The
management or board of the company offers employment in the form of an
appointment letter mentioning the post, the rank, the salary grade, the date by
which the candidate should join and other terms and conditions of employment.
Some firms make a contract of service on judicial paper. Usually an appointment is
made on probation in the beginning. The probation period may range from three
months to two years. When the work and conduct of the employee is found
satisfactory, he may be confirmed. The personnel department prepares a waiting
list and informs the candidates. In case a person does not join after being selected,
the company calls next person on the waiting list.
10. Evaluation: The selection process, if properly performed, will ensure
availability of competent and committed personnel. A period audit, conducted by
people who work independently of the human resource department, will evaluate
the effectiveness of the selection process. The auditors will do a thoro ugh and the
intensive analysis and evaluate the employment programme.
69
7.4 REVISION POINTS
1. 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.
2. There are five main steps in the selection process. First, criteria are
developed to determine how the person will be chosen. Second is a review of
the applications and rsums, often done via a computer program that can
find keywords. Next is interviewing the employee. The last steps involve
testing, such as a personality test or drug test, and then finally, making the
offer to the right candidate.
3. Aptitude Tests: These measure whether an individual has the capacity or
talent ability to learn a given job if given adequate training. These are more
useful for clerical and trade positions.
4. Personality Tests: At times, personality affects job performance. These
determine personality traits of the candidate such as cooperativeness,
emotional balance etc. These seek to assess an individuals motivation,
adjustment to the stresses of everyday life, capacity for interpersonal
relations and self-image.
5. Interest Tests: These determine the applicants interests. The applicant is
asked whether he likes, dislikes, or is indifferent to many examples of school
subjects, occupations, amusements, peculiarities of people, and particular
activities.
6. Performance Tests: In this test the applicant is asked to demonstrate his
ability to do the job. For example, prospective typists are asked to type
several pages with speed and accuracy.
7. Intelligence Tests: This aim at testing the mental capacity of a person with
respect to reasoning, word fluency, numbers, memory, comprehension,
picture arrangement, etc. It measures the ability to grasp, understand and
to make judgement.
8. Knowledge Tests: These are devised to measure the depth of the knowledge
and proficiency in certain skills already achieved by the applicants such as
engineering, accounting etc.
9. Achievement Tests: Whereas aptitude is a capacity to learn in the future,
achievement is concerned with what one has accomplished. When
applicants claim to know something, an achievement test is given to
measure how well they know it.
10. Projective Tests: In these tests the applicant projects his personality into free
responses about pictures shown to him which are ambiguous.
70
1. What do you understand by selection process? Discuss various steps
involved in it.
2. What is application blank? What purpose does it serve? Explain the contents
of an application blank.
3. Discuss the characteristics of a good test. Explain various types of tests
used in the selection process.
4. What is an interview? What purpose does it serve? Discuss various types of
interviews.
5. Discuss various guidelines to be followed for an interview.
6. Explain various steps involved in the selection of personnel.
7.6 SUMMARY
Selection is the process of picking up individuals out of the pool of the job
applicants with requisite qualifications and competence to fill jobs in the
organisation. Proper selection can minimize the costs of replacement and training,
reduce legal challenges, and result in a more productive work force. The discrete
selection process would include the following.
Application Pool,
Preliminary Screening and Interview,
Application Blank or Application Form,
Selection Tests,
Interview
Background Investigation,
Physical Examination,
Approval by Appropriate Authority,
Final Employment Decision,
Evaluation
Selection process involves mutual decision making. The organization decides
whether or not to make a job offer and how attractive the job offer should be. The
candidate decides whether or not the organization and the job offer is according to
his goals and needs. Selection of proper personnel helps the management in g etting
the work done by the people effectively. To be an effective predictor, a selection
device should be
Reliable
Valid
Predict a relevant criterion.
In India the selection process on hiring skilled and managerial personnel are
fairly well defined and systematically practical.
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Fill in the blanks:
1. The purpose of ___________ is to pick up the right person for every job.
2. ___________ are standardized and unbiased methods of soliciting information
about the prospective employees.
3. The test used to measure an individuals capacity or talent ability is called
_____________.
4. An _____________ is a procedure designed to get information from a person
and to assess his potential for the job.
5. The test conducted to measure the depth of knowledge and proficiency of
applicants is ______.
1. Dessler Gary (2001), Personnel Management, Prentice Hall International
Editions, New Jersey.
3. Mamoria C.B., Rao, VSP (2012) Personnal Management (Text and cases),
Himalayas Publishing, Mumbai.
7.9 ASSIGNMENTS
1. How would you handle this?
Poor Interviewer
As the assistant to the HR manager, one of your jobs is to help managers get
ready to interview candidates. When you offer help to Johnathan, he says he has
interviewed hundreds of people and doesnt need your help in planning the
interview process. When you sit in the interview with him, he asks inappropriate
questions that you dont feel really assess the abilities of a candidate. How would
you handle this?
Galgotia Publishing Company, New Delhi.
4. Prasad L.M., (2005), Human Resource Management, Sultan Chand & Sons,
New Delhi.
1. Develop criteria for the position of a retail salesperson working in teams.
2. Describe the advantages and disadvan tages of hiring an internal and
external candidate. Give an example of when you dont think an external
candidate should be considered for a position.
7.12 KEYWORDS
Selection, Test, Interview, Application, Examination, Evaluation.

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LESSON 8
INTERVIEW
8.1 INTRODUCTION
The spoken word is usually the greatest source of investigative evidence and
often the best evidence. The primary goal of an interview is to elicit and record
information from the complainant, su bject, and every important witness. Your
investigation is not complete until you have accomplished this goal.
Effective interviewing is a skill that must be learned by specialized training and/or
experience. Most people learn to interview by watching others or constant
practicing. Learning the basic concepts of the proper way to conduct an interview
and practicing these methods is critical to your success as an interviewer.
8.2 OBJECTIVES
To discern how interview obtain additional information from the candidate.
To know how interview facilitates giving to the candidate information about
the job, company, its policies, products etc.
To be familiar with how interview assess the basic suitability of the
candidate.
8.3 CONTENTS
8.3.1 Meaning and Role of Interview
8.3.2 Types of Interview
8.3.3 Limitations
8.3.4 Guidelines for Effective Interview
8.3.5 Placement
8.3.1 Meaning and Role of Interview
The basic idea is to find out overall suitability of candidates for the jobs. It also
provides opportunity to give relevant information about the organization to the
candidates. In many cases, interview of preliminary nature can be conducted before
the selection tests.
Role of Interview
We must try and understand that interviews are so essential in the selection
process that many times, selection of the candidates is made on the basis of}
interview alone. If handled properly, interview contributes in, the following, ways:
It is the only method of direct contact between the candidates and the
employer in which the employer can see a candidate in action-how he looks, his
manner, his wearing, his appearance, etc., method of interaction and answering
etc.
1. Many of the information can be sought through the interview which may not
be available in application form, or cannot be disclosed by the selection
tests, such as: family background, future plans; etc.
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2. The interview can be used as a tool for giving information about the
organization, its policies, nature of the work to be performed by the
candidate salary and other benefits to be offered. Negotiations, if any, about
the salary and- perks to be offered to the candidate can also be undertaken.
Hence we should remember that interview can be used as a method to
promote goodwill among the candidates by offering courtesy, by providing
vocational literature, by constructive suggestions, and by showing interest in them.
8.3.2 Types of Interview
Types of interviews: Interviews can be classified in various ways according to:
1. Degree of Structure
2. Purpose of Interview
3. Content of Interview
(A) Degree of Structure
(1) Unstructured or non directive: in which you ask questions as they come
to mind. There is no set format to follow.
(2) Structured or directive: in which the questions and acceptable responses
are specified in advance. The responses are rated for appropriateness of content.
Structured and non-structured interviews have their pros and cons. In
structured interviews all applicants are generally asked all required questions by all
interviewers. Structured interviews are generally more valid. However structured
interviews do not allow the flexibility to pursue points of interests as they develop.
(B) Purpose of Interview
A selection interview is a type of interview designed to predict future job
performance, on the basis of applicants responses to the oral questions asked to
him.
A stress interview is a special type of selection interview in which the
applicant is made uncomfortable by series of awkward and rude questions. The aim
of stress interview is supposedly to identify applicants low or high stress tolerance.
In such an interview the applicant is made uncomfortable by throwing him on the
defensive by series of frank and often discourteous questions by the interviewer.
(C) Content of Interview
The content of interview can be of a ty pe in which individuals ability to project
a situation is tested. This is a situation type interview.
In job-related interview, interviewer attempts to assess the applicants past
behaviors for job related information, but most questions are not considered
situational.
In a behaviour interview a situation in described and candidates are asked
how they behaved in the past in such a situation. While in situational interviews
candidates are asked to describe how they would react to situation today or
tomorrow. In the behavioral interview they are asked to describe how they did react
to the situation in the past.
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Principles of Interviewing
To make it effective, an interview should be properly planned and conducted
on certain principles; Edwin B. Flippo has de scribed certain rules and principles of
good interviewing to this end:
Provide proper surroundings. The physical setting for the interview should
be both private and comfortable.
The mental setting should be one of rapport. The interviewer must be aware
of non-verbal behaviour.
Plan for the interview by thoroughly reviewing job specifications and job
descriptions.
Determine the specific objectives and the method of the interviewing.
Inform yourself as much as possible concerning the known information
about the interviewee.
The interviewer should possess and demonstrate a basic liking and respect
for people.
Questions should be asked in a manner that encourages the interviewee to
talk. Put the applicant at ease.
Make a decision only when all the data and information are available. Avoid
decisions that are based on first impressions.
Conclude the interview tactfully, making sure that the candidate leaves
feeling neither too related nor frustrated.
Maintain some written record of the interview during or immediately after it.
Listen attentively and, if possible, protectively.
Questions must be stated clearly to avoid confusion and ambiguity.
Maintain a balance between open and overtly structured questions.
Body language must not be ignored.
The interviewer should make some overt sign to indicate the end of the
interview.
Interviewing is largely an art, the application of which can be improved
through practice.
8.3.3 Limitations
Admonition of silence
Dissemination of results of interview
Presence of attorney and/or union representative
Use of recorders
Interviewee demand for information
Emotional outbursts
Interruptions
75
8.3.4 Guidelines for Effective Interview
Greet the interviewee in an appropriate manner.
Establish rapport.
Define or state the purpose of the interview.
Maintain control; dont let the interviewee interview you.
Ask one question at a time.
Evaluate each piece of information or allegation on its own merit.
Maintain strict impartiality and keep an open mind.
Keep your talking to a minimum.
Keep the interviewee at ease.
React to disclosures appropriately.
Be non-judgmental.
Limit barriers between you and the interviewee.
Dont let the interviewee interview you.
Avoid arguing with the interviewee.
Listen before taking action.
Take your time. Dont hurry.
Be a good listener.
Accept the interviewees feelings.
Use appropriate questioning techniques, as described in this chapter.
Use silence, when appropriate to force a response.
Make no promises.
Ask questions that develop or explain facts, such as questions that begin
with Who, What, When, Where, Why, and How. Ask questions in a
conversational manner.
Use transitions to connect thoughts, starting with known information and
working toward areas of undisclosed information.
Use leading questions as a technique for making transitions from one topic
to another.
Use terms that are familiar to the interviewee and avoid using acronyms.
Ask a general opening question.
Match the interviewees verbal pace.
Ask questions in a logical progression based on the sequence of events.
Follow open-ended questions with specific questions.
76
Ask what the complainant/interviewee expects or wants to happen as a
result of the information he/she provides.
Take breaks often.
Dont argue.
Ask if there is any other issue or information the IG should know or
anything else the interviewee would like to add.
Set up a time for continuation, if necessary.
Extend your appreciation.
Close the interview appropriately.
To elicit information from reluctant interviewees:
Tell interviewees the information will be used For Official Use Only.
Avoid the word confidential.
Explain the Freedom of Information Act (FOIA) and the Privacy Act.
8.3.5 Placement
According to Pigors and Myers, Placement consists in matching what the
supervisor has reason to think the new employee can do with what the job
demands (job requirements), imposes (in strain, working conditions, etc.), and
offers (in the form of pay rate, interest, companionship with other, promotional
possibilities, etc.) They further state that it is not easy to match all these factors
for a new worker who is still in many ways an unknown quantity. For this reason,
the first placement usually carries with it the status of probationer.
A few basic principles should be followed at the time of placement of an employee on the
job.
These may be enumerated as below:
The job should be offered to the man according to his qualifications. The
placement should neither be higher nor l ower than the qualifications.
While introducing the job to the new employee, an effort should be made to
develop a sense of loyalty and cooperation in him so that he may realize his
responsibilities better towards the job and the organization.
The employee should be made conversant with the working conditions
prevailing in the industry and all things relating to the job. He should also
be made aware of the penalties if he commits a wrong.
Man should be placed on the job according to the requirements of the job.
The job should not be adjusted according to the qualifications or
requirements of the man. Job first; man next, should be the principle of
placement.
The placement should be ready before the joining date of the newly selected
person.
77
The placement in the initial period may be temporary as changes are likely
after the completion of training. The employee may be later transferred to
the job where he can do better justice.
After selecting a candidate, he should be placed on a suitable job. Placement is
the actual posting of an employee to a specific job. It involves assigning a specific
rank and responsibility to an employee. The line manager takes the placement
decisions after matching the requirements of a job with the qualification of a
candidate.
The employee will also suffer seriously. He may quit the organization in
frustration, complaining bitterly about everything. Proper placement is, therefore,
important to both the employee and the organization. The benefits of placements
may be summarized thus,
Major Benefits of Proper Placement
The employee is able to:
Show good results on the job.
Get along with people easily.
Keep his spirits high, report for duty regularly.
Avoid mistakes and accidents.
8.4 REVISION POINTS
1. The basic idea is to find out overall suitability of candidates for the jobs. It
also provides opportunity to give relevant information about the organization
to the candidates.
2. Types of interviews: Interviews can be classified in various ways according
to:
Degree of Structure b. Purpose of Interview c. Content of Interview.
3. Limitations- Admonition of Silence, Dissemination of Results of Interview.
4. Guidelines For Effective Interview-Greet The Interviewee In An Appropriate
Manner, Establish Rapport.
5. Placement consists in matching what the supervisor has reason to think the
new employee can do with what the job demands (job requirements),
imposes (in strain, working conditions, etc.), and offers (in the form of pay
rate, interest, companionship with other, promotional possibilities, etc.).
They further state that it is not easy to match all these factors for a new
worker who is still in many ways an unknown quantity. For this reason, the
first placement usually carries with it the status of probationer.
1. Explain the various types of interviews and interview questions.
2. Discuss interview methods and potential mistakes in interviewing
candidates.
3. Explain the interview process.
78
8.6 SUMMARY
Most organizations put new recruits on probation for a given period of time,
after which their services are confirmed. During this period, the performance of the
probationer is closely monitored. If the new recruit fails to adjust himself to the job
and turns out poor performance, the organization may consider his name for
placement elsewhere. Such second placement is called differential placement.
Usually the employees supervisor, in consultation with the higher levels of line
management, takes decisions regarding the future placement of each employee.
Placement is an important human resource activity. If neglected, it may create
employee adjustment problems leading to absenteeism, turnover, accidents, poor
performance, etc.
Fill in the blanks:
1. The only method of direct contact between the candidates and the employer
is ________.
2. The interview in which a situation is described and candidates are asked
how they behaved in the past is such a situation is called _________
interview.
3. __________ consists in matching what the supervisor thinks the new
employee can do with what the job demands, imposes and offers.
4. __________ is the key to successful interviewing.
5. A special type of selection interview in which the applicant is made
uncomfortable by series of awkward and rude questions is ________
interview.

1. Gary Dessler, Human Resource Management, Prentice Hall of India Private
Limited, New Delhi.
2. Lawrence S. Kleiman, Human Resource Management, Biztantra Innovations
in Management, New Delhi, 2003.
3. Arthur Sherman, George Bohlander & Scott Snell, Managing Human
Resources, An International Thomson Publishing Company.
8.9 ASSIGNMENTS
1. With a partner, develop a list of five examples (not already given in the
lesson) of situational and behavioral interview questions.
2. Why is it important to determine cri teria and interview questions before
bringing someone in for an interview?
3. Visit Monster.com and find two examples of job postings that ask those with
criminal records not to apply. Do you think, given the type of job, this is a
reasonable criteria?
79
1. C.B. Mamoria and S.V. Gankar, A textbook of Human Resource
Management, Himalaya Publishing House, 2003.
2. K. Aswathappa, Human Resource and Personnel Management: Text and
Cases, Tata McGraw-Hill Publishing Company Limited, New Delhi, 2002.
3. V.S.P. Rao, Human Resource Management: Text and Cases, Excel Books,
New Delhi, 2002.
1. Explain yourself: When was the last time you interviewed for a job? Did the
process seem to flow smoothly? Why or why not?
8.12 KEYWORDS
Interview, Placement, Guidelines, Limitations, Effective Interview.

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UNIT III : JOB ANALYSIS AND EVALUATION
LESSON 9
JOB ANALYSIS
9.1 INTRODUCTION
In this lesson we will be discussing the nature and use of Job Analysis. Let us
first try to understand what is job analysis. You must understand that Job analysis
provides the basis for determining what ty pes of information should be obtained
from the applicant, from previous employers, and from other sources.
Even though many companies are laying off substantial portions of their
workforces, employee selection is a vital part of HRM. Personnel selection is
important in the building of a productive workforce. Determining the qualifications
of job candidates requires that as much information as possible be obtained from
the candidates and other sources. It is important for you to understand that the
information that is collected should be relevant for to the job and sufficiently
reliable and valid. HR practitioners should have an understanding of job
requirements to permit an analysis of application forms, employment tests,
interviews, and reference checks of individual candidates.
9.2 OBJECTIVES
Define job analysis.
Understand the basic steps in a job analysis.
Identify the major methods of collecting Job analysis data.
9.3 CONTENTS
9.3.1 Meaning and Purpose of Job and Job Analysis
9.3.2 Uses of Job Analysis
9.3.3 Steps in Job Analysis
9.3.4 Techniques in Job Analysis
9.3.1 Meaning and Purpose of Job and Job Analysis
Manpower planning is concerned with determination of quantitative and
qualitative requirements of manpower for the organization. Determination of
manpower requirements is one of the most important problems in manpower
planning. Job analysis and job design, provide this knowledge. Before going
through the mechanism of job analysis and job design, it is relevant to understand
the terms which are used in job analysis and job design.
Job: A job may be defined as a collection or aggregation of tasks, duties and
responsibilities which as a whole, are regarded as a regular assignment to
individual employees, and which is different from other assignments, In other
words, when the total work to be done is divided and grouped into packages, we call
it a job. Each job has a definite title based upon standardized trade specifications
within a job; two or more grades may be identified, where the work assignment may
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be graded according to skill, the difficulty of doing them, or the quality of
workmanship. Thus, it may be noted that a position is a collection o tasks and
responsibilities regularly assigned to one person; while a job is a group of
position, which involve essentially the same duties, responsibilities, skill and
knowledge. A position consists of a particular set of duties assigned to an
individual.
Decenzo and P. Robbins define other terms as follows:
Task: It is a distinct work activity carried out for a distinct purpose.
Duty: It is a number of tasks.
Position: It refers to one or more duties performed by one person in an
organization, There are at least as many positions as there are workers in
the organization; vacancies may create more positions than employees.
Job: It is a type of position within the organization.
Job Family: It is group of two or more jobs that either call for similar worker
characteristics or contain parallel work tasks as determined by job analysis.
Occupation: It is a group of similar jobs found across organizations.
Career: It represents a sequence of positions, jobs, or occupations that a person
has over his working life.
Job Analysis Defined
Developing an organizational structure, results in jobs which have to be
staffed. Job analysis is the procedure through which you determine the duties and
nature of the jobs and the kinds of people (in terms of skills and experience) who
should be hired for them. It provides you with data on job requirements, which are
then used for developing job descriptions (what the job entails) and job
specifications (what kind of people to hire for the job). Some of the definitions of job
analysis ate given as follows, to understand the meaning of the term more clearly:
According to Michael L. Jucius, Job analysis refers to the process of
studying the operations, duties and organizational aspects of jobs in order to derive
specifications or as they called by some, job descriptions.
According to DeCenzo and P. Robbins, A job analysis is a systematic
exploration of the activities within a job. It is a basic technical procedure, one that
is used to define the duties, responsibilities, and accountabilities of a job.
According to Herbert G Herman A job is a collection of tasks that can be
performed by a single employee to contribute to the production of some product or
service provided by the organization. Each job has certain ability requirements (as
well as certain rewards) associated with it. Job analysis process used to identify
these requirements.
Flippo has offered a more comprehensive definition of job analysis as,
Job analysis is the process of studying and collecting information relating to the
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operations and responsibilities of a specific job. The immediate produc ts of the
analysis are job descriptions and job specifications.
Thus, job analysis involves the process of identifying the nature of a job (job
description) and the qualities of the likely job holder (job specification).
9.3.2 Uses of Job Analysis
1. Achievement of Goals: Weather and Davis have stated, Jobs are at the
core of every organizations productivity, if they are designed well and done right,
the organization makes progress towards its objectives. Otherwise, productivity
suffers, profits fall, and the organization is less able to meet the demands of society,
customer, employees, and other with a stake in its success.
2. Organizational Design: Job analysis will be useful in classifying the jobs
and the interrelationships among the jobs. On the basis of information obtained
through job analysis, sound decisions regarding hierarchical positions and
functional differentiation can be taken and this will improve operational efficiency.
3. Organization and Manpower Planning: It is helpful in organization
planning, for it defines labour in concrete terms and co-ordinates the activities of
the work force, and clearly divides duties and responsibilities.
4. Recruitment and Selection: Job analysis provides you with information on what
the job entails and what human requirements are required to carry out these activities.
This information is the basis on which you decide what sort of people to recruit and hire.
5. Placement and Orientation: Job analysis helps in matching the job
requirements with the abilities, interests and aptitudes of people. Jobs will be
assigned to persons on the basis of suitability for the job. The orientation
programme will help the employee in learning the activi ties and understanding
duties that are required to perform a given job more effectively.
6. Employee Training and Management Development: Job analysis
provides the necessary information to the management of training and development
programmes. It helps in to determine the content and subject matter of in training
courses. It also helps in checking application information, interviewing test results
and in checking references.
7. Job Evaluation and Compensation: Job evaluation is the process of
determining the relative worth of different jobs in an organization with a view to link
compensation, both basic and supplementary, with the worth of the jobs. The worth
of a job is determined on the basis of job characteristics and job holder
characteristics. Job analysis provides both in the forms of job description and job
specification.
8. Performance Appraisal: Performance appraisal involves comparing each
employees actual performance with his or her desired performance. Through job
analysis industrial engineers and other experts determine standards to be achieved
and specific activities to be performed.
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9. Health and Safety: It provides an opportunity for identifying hazardous
conditions and unhealthy environmental factors so that corrective measures may
be taken to minimize and avoid the possibility of accidents.
10. Employee Counseling: Job analysis provides information about career
choices and personal limitation. Such information is helpful in vocational guidance
and rehabilitation counseling. Employees who are unable to cope with the hazards
and demands of given jobs may be advised to opt for subsidiary jobs or to seek
premature retirement.
9.3.3 Steps in Job Analysis
The six steps of job analysis are shown in figure
Job Analysis Process

1. Determine the Use of the Job Analysis Information: Start by identifying
the use to which the information will be put, since this will determine the type of
data you collect and the technique you use to collect them.
2. Collection of Background Information: According to Terry, The make-up
of a job, its relation to other jobs, and its requirements for competent performance
are essential information needed for a job evaluation. This information can be had
by reviewing available background information such as organization charts (which
show how the job in question relates to other jobs and where they fit into the
overall organization); class specifications (which describe the general requirements
of the class of job to which the
job under analysis belongs); and the existing job descriptions which provide a
starting point from which to build the revised job description.
3. Selection of Jobs for Analysis: To do job analysis is a costly and time
consuming process. It is hence, necessary to select a representati ve sample of jobs
for purposes of analysis. Priorities of various jobs can also be determined. A job
may be selected because it has undergone undocumented changes in job content.
The request for analysis of a job may originate with the employee, supervisor, or a
84
manager. When the employee requests an analysis it is usually because new job
demands have not been reflected in changes in wages.
Employees salaries are, in part, based upon the nature of the work that they
perform. Some organizations establish a time cycle for the analysis of each job. For
example: A job analysis may be required for all jobs every three years. New jobs
must also be subjected to analysis.
4. Collection of Job Analysis Data: Job data on features of the job, requited
employee qualification and requirements, should be collected either form the
employees who actually perform a job; or from other employees (such as foremen or
supervisors) who watch the workers doing a job and there by acquire knowledge
about it; or from the outside persons, known as the trade job analysis who are
appointed to watch employees performing a job. The duties of such a trade job
analyst are (i) to outline the complete scope of a job and to consider all the physical
and mental activities involved in determinin g what the worker does.; (ii) find out
why a worker does a job; and for this purpose he studies why each task is essential
for the overall result; and (iii) the skill factor which may be needed in the worker to
differentiate between jobs and establish the extent of the difficulty of any job.
5. Processing the Information: Once job analysis information has been
collected, the next step is to place it in a form that will make it useful to those
charged with the various personnel functions. Several issues arise with respect to
this. First, how much detail is needed? Second, can the job analysis information be
expressed in quantitative terms? These must be considered properly.
6. Preparing Job Descriptions and Job Classifications: Job information
which has been collected must be processed to prepare the job description form. It
is a statement showing full details of the activities of the job. Separate job
description forms may be used for various activities in the job and may be compiled
later on. The job analysis is made with the help of these description forms. These
forms may be used as reference for the future.
7. Developing Job Specifications: Job specifications are also prepared on the
basis of information collected. It is a statement of minimum acceptable qualities of
the person to be placed on the job. It specifies the standard by which the qualities
of the person are measured. Job analyst prepares such statement taking into
consideration the skills required in performing the job properly. Such statement is
used in selecting a person matching with the job.
9.3.4 Techniques in Job Analysis
Methods for Collecting Job Analysis Data
As discussed earlier, information is to be collected for job analysis. Such
information may be collected by the trained job analysis, superiors concerned and
job holders themselves. Job information is collected through the following methods:
1. Participant Diary/Logs: Workers can be to keep participant diary/long or
lists of things they do during the day. For every activity he or she engages in, the
employee records the activity (along with the time) in a log. This can provide you
85
with a very comprehensive picture of the job, especially when its supplemented
with subsequent interviews with the worker and his or her supervisor. Thi s method
provides more accurate information if done faithfully. However, it is quite time
consuming. Further, each job holder may maintain records according to his own
way which presents problems in analysis at later stage. Therefore, it has limited
application.
2. Interview: There are three types of interviews you can use to collect job
analysis data: individual interviews with each employee; group interviews with
groups of employees having the same job; and supervisor interviews with one or
more supervisors who are thoroughly knowledgeable about the job being analyzed.
The group interview is used when a large number of employees are performing
similar or identical work, since this can be a quick and inexpensive way of learning
about the job. As a rule, the workers immediate supervisor would attend the group
session; if not, you should interview the supervisor separately to get that persons
perspective on the duties and responsibilities of the job.
3. Critical Incidents: In this method, job holders are asked to describe
incidents concerning the job on the basis of their past experience. The incidents so
collected are analyzed and classified according to the job areas they describe, A
fairly picture of actual job requirements can be obtained by distinguishing between
effective and ineffective behaviors of workers on the job. However, this method is
time consuming. The analyst requires a high degree of skill to analyze the contents
of descriptions given by workers.
4. Technical Conference Method: This method utilizes supervisors with
extensive knowledge of the job. Here, specific characteristics of a job are obtained
from the experts. Although it is a good data gathering method, it often overlooks
the incumbent workers perception about what they do on their job.
5. Job Performance: Under this method, the job analyst actually performs the
job under study to get first-hand experience of the actual tasks, and physical and
social demands of the job. This method can be used only for jobs where skill
requirements are low and can be learnt quickly and easily. This is a time-
consuming method and is not appropriate for jobs requiring extensive training.
6. Functional Job Analysis: Functional job analysis (FJA) is employee-
oriented analytical approach of job analysis. This approach attempts to describe the
whole person on the job. The main features of FJA include the following:
The extent to which specific instruction are necessary to perform the
task
The extent to which reasoning and judgment are required to perform the
task
The mathematical ability required to perform the task and
The verbal and language facilities required to perform the task.
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7. Observation Method: Using this method, a job analyst watches employees
directly on the job. Observations are made on various tasks, activities, the pace at
which tasks are carried out, and the way different activities are performed. This
method is suitable for jobs that involve manual, standardized, and short job cycle
activities. This method also requires that the entire range of activities be
observable; possible with some jobs.
8. Questionnaires: The method is usually employed by engineering
consultants. Properly drafted questionnaires are sent out to job-holders for
completion and are returned to supervisors. However, the information received is
often unorganized and incoherent. The idea in issuing questionnaire is to elicit the
necessary information from job holders so that any error may first be discussed
with the employee and, after corrections, may be submitted to the job analyst. This
technique is time consuming and generally does not yield satisfactory results
because many employees do not complete the questionnaire or furnish incorrect
information because of their own limitation s. The use of questionnaire is
recommended only in case of those technical jobs where the job contents are not
completely known to the supervisor or the operation is too complex to observe.
There are certain standardized questionnaires developed by a few agencies
which are used by various organizations for job analysis. Most of these
questionnaires are of two types: position analysis questionnaire and management
position description questionnaire that are described as follows:
a. Position Analysis Questionnaire: Position analysis questionnaire (PAQ) is
a highly specialized instrument for analyzing a job in terms of employee activities.
The PAQ developed by Purdue University is a comprehensive questionnaire for
collecting information for job analysis. In thi s questionnaire, various job elements
have been grouped into six categories with each category containing relevant job
elements resulting into 195 elements as shown in below table,
No. of
Job Aspects
elements
Information input - Where and how do employee get information to do theirjob? 35
Mental processes- what reasoning, planning, organizing, and decision 14

Making is done?
Work output what physical activities, tools and machines are used? 49
Relationships what contact with other people, both in the company and 36
outside is maintained or developed?
Job context- what is the physical and social context in which the job is 19
Maintained?
Other job characteristics what other activities, conditions or Characteristics 42
not covered by the categories are relevant?
87
The advantage of PAQ is that it provides a quantitative score or profile of any
job in terms of how that job rates on the basic activities. The PAQs real strength is,
thus, in classifying jobs. PAQs results can be used to compare the jobs relative to
one another and pay levels can be assigned for each job. The major problem with
PAQ is the time it takes for a job analyst to fill out the ratings. However, PAQ has
been widely researched and tested and appears to be both reliable and valid.
b. Management Position Description Questionnaire: Management position
description is a highly structured questionnaire containing 208 items relating to
managerial responsibilities, restrictions, demands and other miscellaneous position
characteristics. W.W. Tomov and P.R. Pinto have developed the following
Management position Description factors:
Product, marketing and financial strategy planning.

Coordination of other organization units and personnel
Internal business Control
Products and services responsibility
Public and customer relations
Advanced consulting
Autonomy of actions
Approval of financial commitments
Staff Service
Supervision
Complexity and stress
Advanced financial responsibility
Broad personnel responsibility
The above methods are the most popular ones for gathering job analysis data.
They all provide realistic information about what job incumbents actually do. They
can thus be used for developing job descriptions and job specifications. Caroll L.
Shartle, Otis and Lenhert have provided the following suggestions for making the
job analysts task simple.
Introduce yourself so that the worker knows who you are and why you are
there.
Show a sincere interest in the worker and the job that is analyzed;
Do not try to tell the employee how to do his job.
Try to talk to the employee and supervisors in their own language;
Do a complete job study within the objectives of the programmer: and
Verify the job information obtained.
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9.4 REVISION POINTS
1. A job may be defined as a collection or aggregation of tasks, duties and
responsibilities which as a whole, are regarded as a regular assignment to
individual employees, and which is different from other assignments, In
other words, when the total work to be done is divided and grouped into
packages, we call it a job.
2. Job analysis refers to the process of studying the operations, duties and
organizational aspects of jobs in order to derive specifications or as they
called by some, job descriptions.
3. A job is a collection of tasks that can be performed by a single employee to
contribute to the production of some product or service provided by the
organization. Each job has certain ability requirements (as well as certain
rewards) associated with it. Job analysis process used to identify these
requirements
4. Jobs are at the core of every organizations productivity, if they are designed
well and done right, the organization makes progress towards its objectives.
Otherwise, productivity suffers, profits fall, and the organization is less able
to meet the demands of society, customer, employees, and other with a stake
in its success.
5. Job analysis provides information about career choices and personal limitation.
Such information is helpful in vocational guidance and rehabilitation
counseling. Employees who are unable to cope with the hazards and demands
of given jobs may be advised to opt for subsidiary jobs or to seek premature
retirement
1. What do you understand by job analysis? What is its importance in the
management of human resources?
2. What is job analysis? What steps are involved in the preparation of job
analysis?
3. What are the byproducts of job analysis? Discuss the techniques used for
collecting data for job analysis?
4. What do you know about Job Analysis? Explain.
9.6 SUMMARY
The purpose of an organization is to give each person a separate distinct job
and to ensure that these jobs are coordinated in such a way that the organization
accomplishes its goals. Developing an organization structure results in jobs that
have to be staffed. Job analysis is the procedure through which you find out (1)
what the job entails, and (2) what kinds of people should be hired for the job. It
involves six steps: (1) determine the use of the job analysis information; (2)
collection of background information; (3) selection of jobs for analysis; (4) collection
of job analysis data; (5) processing the information; (6) preparing job descriptions
89
and job classifications; and (7) developing job specifications. Techniques of job
analysis are observation method, questionnaires, participant diary/logs,
interview, critical incidents, technical conference method, and job performance.
Fill in the blanks:
1. Collection or aggregation of tasks, duties and responsibilities which as a
whole, are regarded as a regular assignment to individual employees is
defined as ___________.
2. A distinct work activity carried out for a distinct purpose is __________.
3. ___________ is the procedure through which the duties, nature of the jobs
and kinds of people is determined.
4. The method usually employed by engineering consultants for collecting job
analysis data is ____________.
5. ___________ represents a sequence of positions, jobs, or occupation that a
person has over his working life.
New Delhi.
2. Dessler Gary (2010), Human Resource Management, Prentice Hall
International Editions, New Jersey.
9.9 ASSIGNMENTS
1. If Job analysis doesnt exist, what will be effects on organization? Write it on
your own.
Galgotia Publising Company, New Delhi.
3. Devid A. DeCENZO, Stephen P. Robbins (2002), Personnel/Human
Resource Management, Prentice Hall of India, New Delhi.
90
Case study
Godavari Furniture Company
The Godavari Furniture Company has been manufacturing high quality
furniture for the last 50 years. It has been decided to manufacture kitchen
cabinets. Mr. Venkat was asked to handle this new job with the help of new team
of workers.
Even without meeting new workers, Mr. Venkat informs to Mr. Raman a
furniture designer, I am going to have trouble with new workers. When Mr.
Raman asks Mr. Venkat why he expects difficulties. Mr. Venkat replies that
cabinet workers are self-centered and they do not want to work regularly. You have
to tell them what to do since they are not creative at all. As expected, workers are
not cooperative and they believe that it is very difficult to work under him since he
is impatient.
Questions
1. What made Mr. Venkat to have such assumptions about the work force?
2. How effective was Mr. Venkat as a team builder?
9.12 KEYWORDS
Job, Determination, Selection and Collection.

91
LESSON 10
JOB DESCRIPTION AND JOB SPECIFICATION
10.1 INTRODUCTION
Job description is the factual statement of the responsibilities and duties
relating to a specific job, while job specification is a statement of qualities and
capabilities required for each individual to carry out a specific job. It is the
preparation of a complete and specific statement of human requirements. Job
specification is a statement of personal qualities and capabilities every individual
must possess to perform his or her respective job effectively. Formal qualification,
Experience, intellectual level, knowledge, talents, traits, capabilities, etc. may
come under job specification. It means that an individual who has capability
standard below that is specified may not be suitable for effectively carrying out the
specific job. Every HR manager has a concern for fulfilling the basic minimum
human retirements for each job. In addition to educational qualifications, skill
levels, training background, work experience, etc. are specified for individuals to
effectively carrying out respective jobs.
10.2 OBJECTIVES
To recognize the major elements of job descriptions
To explain how to prepare job descriptions and job specification and their
use.
To point out and explain difference between job description and job
specification.
10.3 CONTENTS
10.3.1 Job Description
10.3.2 Job Specification
10.3.1 Job Description
Job description is the immediate product of job analysis process; the data
collected through job analysis provides a basis for job description and job
specification.
Job Description: is a written record of the duties, responsibilities and
requirements of a particular job. It is concerned with the job itself and not with the
job holders. It is a statement describing the job in such terms as its title, location,
duties, working conditions and hazards.
Flippo has Defined Job Description as, A job description is an organized,
factual statement of duties and responsibilities of a specific job. In brief, it should
tell what is to be done. How it is done why. It is a standard of function, in that
defines the appropriate and authorized content of a job.
According to Pigors and Myres, Job description is a pertinent picture (in
writing) of the organizational relationships, responsibilities and specific duties that
92
constitutes a given job or position. It defines a scope of responsibility and
continuing work assignments that are sufficiently different form that of other jobs
to warrant a specific title.
According to Zerga, who analyzed 401 articles on job description about 30
years ago. A job description helps us in:
1. Job grading and classification
2. Transfers and promotions.
3. Adjustments of grievances;
4. Defining and outlining promotional steps:
5. Establishing a common understanding of a job between employers and
employees;
6. Investigation accidents;
7. Indicating faulty work procedures or duplication of papers;
8. Maintaining, operating and adjusting machinery;
9. Time and motion studies;
10. Defining the limits of authority;
11. Indicating case of personal merit;
12. Studies of health and fatigue;
13. Scientific guidance;
14. Determining jobs suitable for occupational therapy;
15. Providing hiring specifications; and
16. Providing performance indicators.
Job description is different from performance assessment. The former
concerns such functions as planning, co-ordination, and assigning responsibility;
while the latter concerns the quality of performance itself. Though job description is
not assessment, it provides an important basis establishing assessment standards
and objectives.
Writing Job Description
A Job description is a written statement of what the job holder actually does,
how he or she does it, and under what conditions the job is performed. This
information is in turn used to write a job specification. This lists the knowledge,
abilities, and skills needed to perform the job satisfactorily. While there is no
standard format you must use in writing a job description, most descriptions
contain at least sections on:
1. Job Identification: It includes the job title, alterative title, department,
division, and plant and code number of the job. The job title identifies and
designates the job properly, the department, division, etc., indicate the name of the
department where it is situated whether it is the maintenance department,
93
mechanical shop etc. Location gives the name of the place. This portion of job
description gives answer to two important questions: to what higher level job is this
job accountable. And who is supervised directly?
2. Job Summary: Job summary describes the contents of the jobs in terms of
activities or tasks performed. Job summary should clear the nature of the job.
Primary, secondary and other duties to be performed on the job should clearly be
indicated separately.
3. Duties and Responsibilities: This is the most important phase of job
description and should be prepared very carefully. It describes the duties to be
performed along with frequency of each major duty. Responsibilities concerning
custody of money, supervision and training of staff etc. are also described in this
part.
Example of a Job Description
Job Title: Record Clerk Job No. 011
Supervisor: Record Supervisor Job Grand III
Supervises: None Date: __________
Job Summary
Originate, process, and maintain comprehensive records; implement required controls;
collect and summarize data as requested.
Job Duties and Responsibilities
Review a variety of documents, listings, summarizes, etc, for completeness and
accuracy.
Check records against other current sources such as reports or summaries;
investigate differences and take required action to ensure that records are accurate
and up to date; compile and summarize data report format as required.
Implement controls or obtaining, preserving, and supplying a variety of information.
Prepare simple requisitions, forms, and other routine memoranda.
Provide functional guidance to lower-level personnel as required.
Working Conditions
Normal working conditions. But visits sites on average twice a week. Eight hours per day
Relationships
With equivalent officers in other departments.
Maintains formal and social contacts with local officials.
Job Characteristics:
Skilled operation of computer, calculating machine, or key punch machine is not
necessarily a requirement of this job.
The above information is correct and approved by: (Signed)
(Signed)
Job Analyst In charge Manager
94
4. Supervision: Under it is given number of persons to be supervised along
with their job titles, and the extent of supervision involved general, intermediate or
close supervision.
5. Relation to Other Jobs: It describes the vertical and horizontal
relationships f work flow. It also indicates to whom the jobholder will report and
who will report to him. It gives an idea of channels of promotion.
6. Machine, tools and equipment define each major type or trade name of the
machines and tools and the raw materials used.
7. W orking Conditions: The working environment in terms of heat, light,
noise, dust and fumes etc, the job hazards and possibility of their occurrence and
working conditions should also be described. It will be helpful in job evaluation.
8. Social Environment: It specifies the social conditions under which the
work will be performed. In this part the size of work group, interpersonal
interactions required to perform the job and development facilities are mentioned
10.3.2 Job Specification
The job specification states the minimum acceptable qualifications that the
incumbent must possess to perform the job successfully. Based on the information
acquired through job analysis, the job specification identifies the knowledge, skills,
and abilities needed to do the job effectively. Individuals possessing the personal
characteristics identified in the job specification should perform the job more
effectively than individuals lacking these personal characteristics. The job
specification, therefore, is a important tool in the selection process, for it keeps the
selectors attention on the list of qualifications necessary for an incumbent to
perform the job and assists in determining whether candidates are qualified.
According to Dale Yoder, The job specification, as such a summary properly
described is thus a specialized job description, emphasizing personnel requirement
and designed especially to facilitate selection and placement.
Flippo has defined job specification as, Job specification is a statement of
the minimum acceptable human qualities necessary to perform a job properly
.. It is a standard of personnel and designates the qualities required for
acceptable performance.
In is clear from the above definitions that job specification is a statement of
summary of personnel requirements for a job. It may also be called standard of
personal for the selection
A Job Specification should include
(i) Physical characteristics, which include health, strength, endurance, age,
height, weight, vision, voice, eye, hand and foot co-ordination, motor co-ordination,
and colour discrimination.
(ii) Psychological and social characteristics such as emotional stability,
flexibility, decision making ability, analytical view, mental ability, pleasing
manners, initiative, conversational ability etc.
95
(iii) Mental Characteristics such as general intelligence, memory, judgment,
ability to concentrate, foresight etc.
(iv) Personal Characteristics such as sex, education, family background, job
experience, hobbies, extracurricular activities etc.
All these characteristics must be classified into three categories:
Essential attributes which a person must possess.
Desirable attributes which a person ought to posses.
Contra indicators which will become a handicap to successful job
performance.
10.4 REVISION POINTS
1. Job description is the factual statement of the responsibilities and duties
relating to a specific job, while job specification is a statement of qualities
and capabilities required for each individual to carry out a specific job.
2. A job description is an organized, factual statement of duties and
responsibilities of a specific job. In brief, it should tell what is to be done.
How it is done why. It is a standard of function, in that defines the
appropriate and authorized content of a job.
3. A Job description is a written statement of what the job holder actually does,
how he or she does it, and under what conditions the job is performed. This
information is in turn used to write a job specification.
4. The job specification, as such a summary properly described is thus a
specialized job description, emphasizing personnel requirement and
designed especially to facilitate selection and placement.
5. The job specification states the minimum acceptable qualifications that the
incumbent must possess to perform the job successfully. Based on the
information acquired through job analysis, the job specification identifies the
knowledge, skills, and abilities needed to do the job effectively.
1. Define job specification? How is it different from job description?
2. Distinguish between : Job description and job specification
3. What is job description? How is it prepared?
10.6 SUMMARY
Job description and job specification are products of job analysis. Job
description should indicate: duties to be performed by the job holder and the
manner he should complete the tasks. Job specification: answer the question what
human traits and experience are necessary to do the job. It portrays what kind of
person to recruit and for what qualities that person should be tested.
96
Fill in the blanks:
1. The immediate product of job analysis process is _______________.
2. ____________ describes the contents of the jobs in the terms of activities or
tasks performed.
3. The statement of the minimum acceptable human qualities necessary to
perform a job properly is __________.
4. General intelligence, memory, judgment, ability to concentrate, foresi ght,
etc., are included in ____________ characteristics.
5. ____________ includes job title, alternative title, department, division, and
plant and code number of the job.
1. Business Management - Sharma, Nandkishore
2. Management - Sudha, G.S.
3. Management Without Tears - Mc Donold, James .O.
10.9 ASSIGNMENTS
1. Discuss job description and job specification in organization.
New Delhi.
2. Dessler Gary (2010), Human Resource Management, Prentice Hall
1. Job analysis is the most basic personnel management function. Discuss.
2. Clearly define and discuss the relationship among job analysis, job
description and job specification.
10.12 KEYWORDS
Analysis, Description, Specification, Management, Organization.

97
LESSON 11
JOB EVALUATION
11.1 INTRODUCTION
Job evaluation is a systematic process of analyzing and evaluating jobs to
determine the relative worth of job in an organization. It forms the basis for
designing the sound compensation system in an organization. Since wage and
salary administration and the perceived fairness of approach adopted under it have
a immense influence on employee morale, motivation and satisfaction, proper job
evaluation exercise demands sensible consideration.
An important exercise that an organization needs to carry out is Job Evaluation. It
is nothing but finding out relative worth of a job, in terms its contribution and
significance to the overall organizational objectives.
11.2 OBJECTIVES
To know basic approach to job evaluation.
To importance of job evaluation and its effectiveness.
To know the important methods of Job Evaluation.
11.3 CONTENTS
11.3.1 Meaning and Objectives
11.3.2 Procedures and Uses
11.3.3 Limitations of Job Evaluation
11.3.4 Job Evaluation Methods
11.3.1 Meaning and Objectives
Job evaluation is the process of analyzing and assessing the various jobs
systematically to ascertain their relative worth in an organization. Job is evaluated
on the basis of their content and is placed in the order of their importance.
It should be noted that in a job evaluation programme, the jobs are ranked
and not the jobholders. Jobholders are rated through performance appraisal.
Job evaluation is a process of finding out the relative worth of a job as
compared to other jobs
The following objectives are derived from the analysis of the above -mentioned
definitions: -
1. To gather data and information relating to job description, job specification
and employee specifications for various jobs in an organization.
2. To compare the duties, responsibilities and demands of a job with that of
other jobs.
3. To determine the hierarchy and place of various jobs in an organization.
4. To determine the ranks or grades of various jobs.
98
5. To ensure fair and equitable wages on the basis of relative worth or value of
jobs. In other words equal wages are fixed to the jobs of equal worth or
value.
6. To minimize wage discrimination based on sex, age, caste, region, religion
etc.
11.3.2 Procedure and Uses
Job evaluation programme should be implemented carefully. The following
principles help in successful implementation of the programme:
1. Rate the job but not the employee. Rate the elements on the basis of the job
demands.
2. The elements selected for rating should be easily understood.
3. The elements should be defined clearly and properly selected.
4. Employees concerned and the supervisors should be educated and
convinced about the programme.
5. Supervisors should be encouraged to participate in rating the jobs.
6. Secure employee cooperation by encouraging them to participate in the
rating programme.
7. Discuss with the supervisors and employees about rating but not about
assigning money values to the points.
8. Do not establish too many occupational wages.
Uses:
A job-evaluation program involves answering several questions:
The major ones are:
Which jobs are to be evaluated?
Who should evaluate the jobs?
What training do the evaluation need?
How much time is involved?
What should be the criteria for evaluation?
What methods of evaluation are to be employed?
11.3.3 Limitations of Job Evaluation
How to Improve Job Evaluation
Following measures and steps for improving the work of evaluation programmes;
A job evaluation scheme should be chosen cautiously. It should be devised
and administered on the basis of employment market, demand for labour,
bargaining power of the parties & job conditions.
The details of the scheme should be drawn up in such a way that they do
not conflict with other provision of a collective agreement.
The scheme should be sold to all concerned and suggestions sought.
99
Give major importance that the number of job titles and classification be
kept to a minimum.
Any anticipated changes in methods should be carried out before a scheme
is installed and all modifications in it should be resisted until it becomes
fully established.
In preparing job descriptions it is a sound practice to emphasis in them the
things which makes one job different from another rather than to find a
comprehensive statement of all the duties of the job.
The better the state of industrial relations the easier it is to introduce a job
evaluation scheme.
11.3.4 Job Evaluation Methods
Analytical
1. Point Method
2. Factor Comparison Method
Point Method
The system starts with the selection of job factors, construction of degrees for
each factor, and assignment of points to each degree. Different factors are selected
for different jobs, with accompanying differences in degrees and points.
Let us discuss the different factors with an example:
The National Electrical Manufacturing Association (NEMA), USA has suggested
the factors, degrees and point for hourly rated and salaried jobs. The job factors
taken into consideration by NEMA for hourly rated jobs are :
Skill
Education
Experience
Initiative & ingenuity
Effort
Physical demand
Mental and / or visual demand Responsibility
Responsibility for equipment or process
Responsibility for materials or product
Responsibility for safety of others
Responsibility
Job Conditions
Working conditions
100
Nema Manual for Salaried Jobs
Factors
Education
Experience
Complexity of duties
Monetary responsibility
Working Condition
Contacts
Types of Supervision
Extent of Supervision
Factor-Comparison Method
The factor-comparison method is yet another approach for job evaluation in
the analytical group. Under this method, one begins with the selection of factors;
usually five of them- is assumed to be constant for all the jobs. Each factor is
ranked individually with other jobs. For example, all the jobs may be compared first
by the factor mental requirements. the skills factor, physical requirements,
responsibility, and working conditions are ranked. The total points are then
assigned to each factor. The worth of a job is then obtained by adding together all
the point values.
Non-Analytical
1. Ranking Method
2. Banding Method
3. Job-Grading Method
Non-analytical methods: Ranking and job classification methods come under
this category because they make no use of detailed job factors. Each job is treated
as a whole in determining its relative ranking.
Ranking method: this is the simplest, the most inexpensive and the most
expedient method of evaluation. The evaluation committee assesses the worth of
each job on the basis of its title or on its contents, if the latter is available. But the
job is not broken down into elements or factors. Each job is compared with others
and its place is determined.
The method has several drawbacks. Job evaluation may be subjective, as the
jobs are not broken into factors. It is hard to measure whole jobs.
Ranking is the most straightforward method of work evaluation. Jobs, people,
or even teams can be ranked from the ones adding most value to least value to the
organization. Criteria for the ranking are not made explicit. Jobs rather than people
are easier to rank when there are a large number of people in jobs. Teams can be
ranked in a team-based environment as a su bstitute for or addition to the ranking
of jobs and people. When a larger number of jobs, people, or teams are to be
101
ranked, the method of paired comparisons can be used. With this approach each
entity is compared to every other entity in terms of value to the organization.
Overall value of the entity is determined by the number of times that the entity
is evaluated as being of greater value then the entity being compared against. If an
extremely large number of comparisons need to be made, statistical formulas are
available to reduce the number of comparisons required using sampling theory.
Advantages
1. Simple to use if there is a small number of jobs, people, or teams to evaluate
2. Requires little time
3. Minimal administration required
Disadvantages
1. Criteria for ranking not understood
2. Increases possibility of evaluator bias
3. Very difficult to use if there is a large number of jobs, people, or teams to
evaluate
4. Rankings by different evaluators are not comparable
5. Distance between each rank is not necessarily equal
6. May invite perceptions of inequity
Banding
A banding procedure takes place when jobs are grouped together by common
characteristics. Characteristics used to group jobs follow: exempt versus
nonexempt, professional versus non professional, union versus non union, key
contributor versus non-key contributor, line versus staff, technical versus non-
technical, value-added versus non-value-added, and classified versus non-
classified. Often these groups are then rank ordered and each group is then placed
in a pay band.
Advantages
1. Quick and easy procedure
2. Has initial face validity to employees
3. Allows for organizational flexibility
4. Minimal administration required
Disadvantages
1. Subtle, but important, differences between groups ignored
2. Subtle, but important, differences within groups ignored
3. May invite inequity perceptions
Classification
Classification systems define the value of jobs, people, or teams with written
standards for a hierarchy of classification level. Each classification level may be
defined by a number of factors that need to be present for a job, person, or team to
be slotted into a particular classification level. These factors are usually blended
together resulting in one standard for each classification level.
102
Advantages
1. Jobs, people, and teams can be quickl y slotted into the structure
2. Classification levels have face validity for employees
3. Standards to establish value are made explicit
Disadvantages
1. Many jobs, people, or teams do not fit neatly into a classification level
2. Extensive judgment is required because standards used to define each factor
are blended together
3. Differences between classification levels may not be equal
4. Creates status hierarchies within organizations
5. Extensive administration required
Job-grading Method
As in the ranking method, the job-grading method (or job-classification
method) does not call for a detailed or quantitative analysis of job factors. It is
based on the job as a whole. The difference between the two is that in the ranking
method, there is no yardstick for evaluation, while in the classification method,
there is such a yardstick in the form of job classes or grades. Under the
classification method, the number of grades is first decided upon, and the factors
corresponding to these grades are then determined.
The advantages of the method are; I) job grade descriptions are vague and are
not quantified; ii) difficulty in convincing employees about the inclusion of a job in a
particular grade because of vagueness of grade descriptions; and iii) more job
classification schedules need to be prepared because the same schedule cannot be
used for all types of jobs.
1. Job evaluation is a systematic process of analyzing and evaluating jobs to
determine the relative worth of job in an organization. It forms the basis for
designing the sound compensation system in an organization.
2. Job evaluation is a process of finding out the relative worth of a job as
compared to other jobs
3. A job evaluation scheme should be chosen cautiously. It should be devised
and administered on the basis of employment market, demand for labour,
bargaining power of the parties & job conditions.
4. Any anticipated changes in methods should be carried out before a scheme
is installed and all modifications in it should be resisted until it becomes
fully established.
5. Ranking and job classification methods come under this category because
they make no use of detailed job factors. Each job is treated as a whole in
determining its relative ranking.
103
1. What is job evaluation? Explain.
2. What are the methods used in Job evaluation? Describe with example.
3. How to improve job evaluation?
11.6 SUMMARY
A job evaluation scheme should be chosen cautiously. It should be devised and
administered on the basis of employment market, demand for labour, bargaining
power of the parties & job conditions.
Fill in the blanks:
1. ___________ is the process of analyzing and assessing the various jobs
systematically to ascertain their relative worth in an organization.
2. Job holders are rated through __________.
3. The most simplest, inexpensive, expedient method of evaluation is
____________ method.
4. _____________ method takes place when jobs are grouped together by
common characteristics.
5. The method that does not call for a detailed or quantitative analysis of job
factors is called ______________.
1. Human Resource Management - Rao, J. V.
2. Organisational Behavior Text & Cases - Sekaran Uma
3. Quantitative Techniques - Jhamd, L.C.
11.9 ASSIGNMENTS
1. Delineate Job Analysis and methods with example.
2. Describe the analytical and non- analytical methods used in job evaluation.
1. K.Aswathappa;Human Resource and Personnel Management- Text and
cases;Tata McGraw Hill Publishing company Ltd, New Delhi, 4 th edition
2005.
2. Edwin B. Flippo; Personnel Management; McGraw Hill Book Company,
Singapore; International edition 1984
3. Wayne F.Casico; Managing Human Resource- Productivity, Quality of Work
Life, Profits ,Tata McGraw Hill Publishing Company Ltd, New Delhi 7 th edition
2006.
4. G.S. Sudha; Human Resource Management; Professional Publications,
Jaipur, 3rd revised edition 2009.
1. Explain ranking method.
2. Explain Job-Grading method.
11.12 KEYWORDS
Job Evaluation, Limitations, Uses, Methods and Techniques.

104
LESSON 12
JOB DESIGN
12.1 INTRODUCTION
Job design is of comparatively recent origin. The human resource managers
have realized that the design of a job has considerable influence on the productivity
and job satisfaction; poorly designed jobs often result in boredom to the employees,
increased turnover, job dissatisfaction, low productivity and an increase in overall
costs of the organization. All these negative consequences can be avoided with the
help of proper job design.
12.2 OBJECTIVES
To know about job design.
To know the process involved in job design.
To know job Enrichment, Job Enlargement, and Job Rotation.
12.3 CONTENTS
12.3.1 Approaches to Designing Jobs
12.3.2 Meaning and Scope of Job Design
12.3.1 Approaches to Designing Jobs
There are three important approaches to job design viz.,
1. Engineering approach,
2. Human approach and
3. The job characteristic approach.
1. Engineering Approach (F.W Taylor, 1911)
The most prominent single element in the Engineering approach, envisaged by
F.W. Taylor and others, was the task idea. The work of every workman is fully
planned out by the management at least one day in advance and each man receives
in most cases complete written instructions, describing in detail the task which be
is to accomplish. This task specifies not only what is to be done but now it is to be
done and the exact time allowed for doing it. The principles offered by scien tific
management to job design can be summarized thus:
Work should be scientifically studied. Taylor advocated fragmentation and
routinisation of work to reap the advantages of specification.
Work should be arranged so that workers can be efficient.
Employees selected for work should be matched to the demands of the job.
Employees should be trained to perform the job.
Monetary compensation should be used to reward successful performance of
the job.
These principles to job design seem to be quite rational and appealing because
they point toward increased organizational performance. Specification and
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routinisation over a period of time result in job incumbents becoming experts
rather quickly, leading to higher levels of output. Despite the assumed gai ns in
efficiency behavioural scientists have found that some job incumbents dislike
specialized and routine jobs. In the course of a study of 180 auto assembly line
workers, one worker lamented: what I cant get used to is the monotony. The job
gets sickening, day in, day out, plugging in ignition wires. I get through with one
job and have another one staring me in the face. More recently a steel worker
complained that the problem with narrowly defined jobs is that they required arms
and hands but no brainwork.
Problems with engineering approach. After listening to several complaints
from employees about their highly specialised jobs, Walker and Guest indicated the
problems with job specialisation thus:
Repetition: Employees performed a few tasks repeatedly. This quickly led the
employee to become very bored with the job. There was no challenge to the
employee to learn anything new or to improve the job.
Mechanical pacing: Assembly line workers were made to maintain a certain
regular pace of work. They could not take a break when they needed, to, or simply
divert their attention to some other aspect of the job or another individual.
No end product: Employees found that they were not turning out any
identifiable end product, consequently, they had li ttle pride and enthusiasm in
their work.
Little social interaction: Employees complained that because the assembly line
demanded constant attention, there was very little opportunity to interact on a
casual basis with other employees and share their work e xperience, beliefs and
sentiments.
No input: Employees also complained that they had little change to choose the
methods by which they performed their jobs, the tools which they used, or the work
procedures. This, of course, created little interest in the job because there was
nothing which they could improve or change.
2. Human Approach
The humane approach recognized the need to design jobs which are
interesting and rewarding. In the past two decades much work has been directed
to changing jobs so that job incumbents can satisfy their needs for growth,
recognition and responsibility. Hertzbergs research popularized the notion of
enhancing need satisfaction through what is called job enrichment. One widely
published approach to job enrichment used that is called as the job characteristics
model and this has been explained separately in the ensuing section. According to
Hertzberg there are two types of factors viz., (i) motivators like achievement,
recognition, work itself, responsibility, advancement an d growth and (ii) hygiene
factors (which merely maintain the employee on the job and in the organization)
like working conditions, organizational policies, inter-personal relations, pay and
job security. According to Hertzberg, the employee is dissatisfie d with the job if the
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maintenance factors to the required degree are not introduced into the job. But,
employee may not be satisfied even if the required maintenance factors are
provided. Hertzberg feels that the employee will be satisfied with his job and he will
be more productive if motivators are introduced into the job content. As such, he
asserts that the job designer has to introduce hygiene factors adequately so as to
reduce dissatisfaction and build motivating factors. Thus Hertzberg has laid
emphasis on the psychological needs of employees in designing job.
3. The Job Characteristics Approach
The job Characteristics Theory of Hackman and Oldham states that employees
will work hard when they are rewarded for the work they do and when the work
gives them satisfaction. Hence they suggest that motivation, satisfaction and
performance should be integrated in the job design. According to this approach,
and job can be described in terms of five core job dimensions which are defined as
follows:
1. Skill Variety: The degree to which a job requires a variety of different
activities so that the workers can use a number of different skills and
talents.
Task Identity: The degree to which the job requires completion of a
whole and identifiable piece of work.
Task Significance: The degree to which the job has a substantial impact
on the lives or work of other people.
Autonomy: The degree to which the job provides substantial freedom,
independence and discretion to the individual in scheduling the work
and in determining the procedures to be used in carrying it out.
Feedback: The degree to which an individual requires direct and clear
information about the effectiveness of his or her performance.
This approach explains that existence of core job characteristics in a job, gives
the psychological satisfaction of meaningful work to the job incumbent. The
characteristic of autonomy gives the job incumbent a feeling of personal
responsibility for the results and the characteristic of feedback from job leads to
psychological state of knowledge about the own performance of job incumbent. The
core job dimensions can be combined into a single predictive index called the
motivating potential score. Its computation is as follows:
Skillvariety + Taskidentify+ Tasksignifican
ce
Motivating potential = Autonomy Feedback
3
Jobs that are high on motivating potential must be high at least in one of the
three factors that lead to meaningful work and they must be high in both autonomy
and feedback and vice versa. High motivating potential score results in positive
motivation, performance and satisfaction and vice versa. The three critical
psychological states lead to the outcome such as (a) high internal work motivation.
(b) high growth satisfaction, (c) high quality work performance, (d) high general job
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satisfaction, (e) high work effectiveness, and (f) low absenteeism and turnover. The
model says that internal rewards are obtained by an individual when he learns that
he has performed well on a task that he cares about.
12.3.2 Meaning and Scope of Job Design
According to Jon Werner and DeSimone, Job design is the development and
alteration of the components of a job (such as the tasks one performs, and the
scope of ones responsibilities) to improve productivity and the quality of the
employees work life. Job design has been defined by Davis (1966) as: The
specification of the contents, methods, and relationships of jobs in order to satisfy
technological and organizational requirements as well as the social and personal
requirements of the job-holder.
Milkovich and Boudreau defined job design as, Job design integrates work
content (tasks, functions, and relationships), the rewards (extrinsic and intrinsic)
and the qualifications required (skills, knowledge, abilities) for each job in a way
that meets the needs of employees and the organization.
Michael Armstrong has defined job design as the process of deciding on the
content of a job in terms of its duties and responsibilities, on the methods to be
used in carrying out the job, in terms of techniques, systems and procedures, and
on the relationships that should exist between the job holder and his superiors,
subordinates and colleagues.
Job design is an attempt to create a match between job requirements and
human attributes. It involves organizing the components of the job and the
interaction patterns among the members of a work group. It helps in developing
appropriate design of job to improve efficiency and satisfaction.
Methods of Job Design
The various techniques of job design and redesign are discussed below:
1. Job Simplification: In job simplification, the complete job is broken down
into small subparts; this is done so that employee can do these jobs without much
specialized training. Moreover, small operations of the job can also be performed
simultaneously so that the complete operation can be done more quickly. For job
simplification, generally time and motion studies are used.
2. Job Rotation: Another technique designed to enhance employee motivation
is job rotation, or periodically assigning employees to alternating jobs or tasks. For
example, an employee may spend two weeks attaching bumpers to vehicles and the
following two weeks making final checks of the chassis. During the next month, the
same employee may be assigned to two different jobs. Therefore, the employee
would be rotated among four jobs. The advantage of job rotation is that employees
do not have the same routine job day after day. Job rotation only addresses the
problem of assigning employees to jobs of limited scope; the depth of the job does
not change. The job cycle of the actual daily work performed has not been
lengthened or changed. Instead, employees are simply assigned to different jobs
with different cycles.
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Because job rotation does not change the basic nature of jobs, it is criticized as
nothing more than having an employee perform several boring and monotonous
jobs rather than one. Some employees dislike job rotation more than being assigned
to one boring job because when they are assigned to one job they know exactly
where to report and what work to expect each day. Workers quickly realize that job
rotation does not increase their interest in their work. Although it seldom addresses
the lack of employee motivation, it give manages a means of coping with frequent
absenteeism and high turnover.
Thus when absenteeism or turnover occurs in the work forc e, managers can
quickly fill the vacated position because each employee can perform several jobs.
Job rotation is often effectively used as a training technique for new, inexperienced
employees. At higher organizational levels, rotation also helps to devel op managerial
generalists because it exposes them to several different operations.
Advantage of Job Rotation Technique
The employee experiences variety of work, workplace and peer group.
Job rotation helps to broaden the knowledge and skills of an employe e.
The main advantage of job rotation is that it relieves the employee from the
boredom and monotony of doing the same job.
With the help of this method, people become more flexible. They are
prepared to assume responsibility especially at other positions.
Job rotation broadens the work experience of employees and turns
specialists into generalists.
It is beneficial for the management also as the management gets employees
who can perform a variety of tasks to meet the contingencies.
This method improves the self image and personal worth of the employee.
Disadvantage of Job Rotation Technique
Job rotation also creates disruptions. Members of the work group have to
adjust to the new employee.
Productivity is reduced by moving a worker into new position just when his
efficiency at the prior job was creating organizational economies.
Training costs are increased.
The supervisor may also have to spend more time answering question and
monitoring the work of the recently rotated employee.
It can demotivate intelligent and ambitious trainees who seek specific
responsibilities in their chosen specialty.
3. Job Enlargement: Another means of increasing employees satisfaction with
routine jobs is job enlargement, or increasing the number of tasks performed (i.e .
increasing the scope of the job). Job enlargement, like job rotation, tries to
eliminate short job cycles that create boredom. Unlike job rotation, job enlargement
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actually increases the job cycle. When a job is enlarged, either the tasks being
performed are enlarged or several short tasks are given to one worker. Thus, the
scope of the job is increased because there are many tasks to be performed by the
same worker. Job enlargement programs change many methods of operation - in
contrast to job rotation, in which the same work procedures are used by workers
who rotate through work stations. Although job enlargement actually changes the
pace of the work and the operation by reallocating tasks and responsibilities, it
does not increase the depth of a job. The focus of designing work for job
enlargement is the exact opposite of that for job specialization. Instead of designing
jobs to be divided up into the fewest of tasks per employee, a job is designed to have
many tasks for the employee to perform. An enlarged job requires a longer training
period because there are more tasks to be learned. Worker satisfaction should
increase because is reduced as the job scope is expanded. However, job
enlargement programs are successful with jobs what have increased scope; such
workers are less prone to resort to absenteeism, grievances, slowdowns and other
means of displaying job dissatisfaction.
Enlargement is done only on the horizontal level. Thus, the job remains the
same, but becomes of a larger scale than before. In the words of Geroge Strauss
and L.R. Sayles Job enlargement implies that instead of assigning one man to each
job, a group of men can be assigned to a group of jobs and then allowed to decide
for themselves how to organize the work. Such changes permit more social contacts
and control over the work process.
Job enlargement has the following advantages
Increase in diversity of jobs
Job satisfaction
Provides wholeness and identity with the task and increases the knowledge
necessary to perform it.
Provides variety of skills.
Reduces tension and boredom.
Trains and develops more versatile employees.
Despite these advantages this is not a completely satisfactory method of job
design as it does not increase the depth of a job. Enlarged jobs require longer
training period as there are more tasks to be learned.
4. Job Enrichment: The concept of job enrichment has been derived from
Herzbergs two-factor theory of motivation in which he has suggested that job content
is one of the basic factors of motivation. If the job is designed in such a manner that it
becomes more interesting and challenging to the job performer and provides him
opportunities for achievement, recognition, responsibility, advancement and growth,
the job itself becomes a source of motivation to the individual.
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According to Richard W. Beatty and Graig Eric. Schneider, Job enrichment is
a motivational technique which emphasizes the need for challenging and interesting
work. It suggests that jobs be redesigned so that intrinsic satisfaction is derived from
doing the job. In its best applications it leads to a vertically enhanced job by adding
function from other organizational levels, making it contain more variety and challenge
and offer autonomy and pride to the employee.
According to P. Robbins, Job enrichment refers to the vertical expansion of the
jobs. It increases the degree to which the worker controls the planning, execution and
evaluation of his work.
In the words of Robert Albanese, Job enrichment sometimes called. vertical
job leading is a job redesign strategy that focuses on job depth.
According to Mondy. Holmes, and Flippo, Job enrichment refers to basic
changes in the content and level of responsibility of a job so to provide for the
satisfaction of the motivation needs of personnel.
Rebert Ford, who was associated with designing of jobs to make them more
enriched, has provided some bases (though not exhaustive) for job enrichment .
Techniques of Job Enrichment: In order to enrich the jobs. The management
should adopt the following measures:
Freedom in decisions
Assign a natural work unit to an employee.
Encouraging participation
Allow the employee to set his own standards of performance.
Minimize the controls to provide freedom to the employees
Make an employee directly responsible for his performance.
Encourage participation of employees in deciding organizational goals and
policies.
Expand job vertically
Introducing new, difficult and creative tasks to the employees.
Sense of achievement.
Advantages of Job Enrichment: The advantages of job enrichment are as
follows:
It enriches the role.
Job enrichment is the most widely used of job design as it provides a
meaningful learning to employees.
It makes the work interesting and employee get motivated.
It helps in reducing the rate of labour turnover and absenteeism.
It increases skills of the employees.
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It increases morale and performance.
Reduce Boredom and dissatisfaction.
Increase in output both qualitative and quantitative.
Disadvantages of Job Enrichment
Dunham and Newstrom state, Even the strongest supporters of job
enrichment readily admit that there are limitations in its application. Newstrom
and Keith Davis also write, Employees are the final judges of what enriches their
jobs. All that management can do is to gather information about what tends to
enrich jobs, try these changes in the job system, and then determine whether
employees feel that enrichment has occurred. A few limitations of or problems with
job enrichment are as follows:
Tasks Motivator involved
Assign specific or specialized task to individuals enabling them to become
expert Responsibility, growth, advancement Making periodic reports directly
available to the individual himself rather than to the supervisor. Internal
recognition Giving a person a whole, natural unit of work (module, exchange
district, division, area, etc.) Responsibility, achievement, recognition Increasing the
accountability of individuals for own work Responsibility, recognition
Increase cost
Need more employee counseling, training, and guidance.
Not applicable to all jobs.
Negative impact on personnel.
Imposed on people.
Objected by unions
Pay dissatisfaction
Job Enlargement vs. Job Enrichment
Job enlargement and job enrichment are both important forms of job design in
order to enhance productivity and satisfaction of the employees. They differ from
each other in the following respects:
1. Nature of Job: The major difference between job enrichment and
enlargement lies in the nature of additions to the job. Enlargement involves a
horizontal loading or expansion, or addition of tasks of the same nature.
Enrichment involves vertical loading of tasks and responsibility of the job holder; it
improves the quality of the job in terms of its intrinsic worth.
2. Purpose: The purpose of job enlargement is to reduce the monotony in
performing repetitive jobs by lengthening the cycle of operation. On the other hand,
the purpose of job enrichment is making the job lively, challenging and satisfying. It
satisfies the higher level needs such as ego satisfaction, self expression, sense of
achievement and advancement of Job holders.
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3. Skill Requirement: Job enlargement may not necessarily require the use of
additional skills which the job holder was using in performing the job before the
enlargement. This is due to similarity of additional tasks. Enrichment calls foe
development and utilization of higher skills, initiative, and innovation on the part of
the job holder in performing the job.
4. Direction and Control: Job enlargement requires direction and control
from external sources, say supervisor. In fact, the job holder may require more
direction and control because of enlargement of his responsibility. Enrichment does
not require external direction and control as these come from the job holder
himself. He requires only feedback from his supervisor.
1. Job design is of comparatively recent origin. The human resource managers
have realized that the design of a job has considerable influence on the
productivity and job satisfaction; poorly designed jobs often result in
boredom to the employees, increased turnover, job dissatisfaction, low
productivity and an increase in overall costs of the organ ization.
2. Job design is the development and alteration of the components of a job
(such as the tasks one performs, and the scope of ones responsibilities) to
improve productivity and the quality of the employees work life.
3. the process of deciding on the content of a job in terms of its duties and
responsibilities, on the methods to be used in carrying out the job, in terms
of techniques, systems and procedures, and on the relationships that should
exist between the job holder and his superiors, subordinates and
colleagues.
4. In job simplification, the complete job is broken down into small subparts;
this is done so that employee can do these jobs without much specialized
training. Moreover, small operations of the job can also be performed
simultaneously so that the complete operation can be done more quickly
5. Job enlargement, like job rotation, tries to eliminate short job cycles that
create boredom. Unlike job rotation, job enlargement actually increases the
job cycle. When a job is enlarged, either the tasks being performed are
enlarged or several short tasks are given to one worker
6. The concept of job enrichment has been derived from Herzbergs two-factor
theory of motivation in which he has suggested that job content is one of the
basic factors of motivation.
1. What is Job Design and Its uses?
2. What is job Rotation and Job Simplification?
3. What is Job Enrichment and Job Enlargement?
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12.6 SUMMARY
Job design is an attempt to create a match between job requirements and job
attribute. Job rotation implies transfer to a job of same level and status. Job
simplification enables the employees to do the without much specialized training
Job enlargement is the process of increasing the scope of job of a particular by
adding more tasks to it. And job enrichment implies increasing the contents of a job
or the deliberate upgrading of responsibility scope and challenge in work. Job
enlargement and job enrichment are both important forms of job design in order to
enhance the productivity and satisfacti on of the job holders.
Fill in the blanks:
1. Engineering approach was envisaged by ___________ in the year 1911.
2. The degree to which the job requires completion of a whole and identifiable
piece of work is ____________.
3. ____________ states that employees will work hard when they are rewarded
for the work they do and when the work gives them satisfaction.
4. The development and alteration of the components of a job to improve
productivity and quality of employees work life is _____________.
5. Periodically assigning employees to alternating jobs or tasks is ___________.
Galgotia Publising Company, New Delhi.
12.9 ASSIGNMENTS
1. Converse the methods used in Job Design.
2. Demonstrate Job Rotation and Job Simplification.
New Delhi.
2. Dessler Gary (2010), Human Resource Management, Pren tice Hall
1. How Job Enlargement differ from Job Enrichment. Give self explanation.
12.12 KEYWORDS
Turn Over, Productivity, Monotony, Operation, Loading

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UNIT IV : HUMAN RESOURCE DEVELOPMENT
LESSON 13
HUMAN RESOURCE DEVELOPMENT
13.1 INTRODUCTION
Human Resource Development is a newly developed field of study. The
development of human beings has been in existence in some form or other since the
beginning of civilization. Once training was the only planned way of developing
human resources. But now Human Resource Development (HRD) has emerged as
an inter-disciplinary and integrated approach to the development of human
resources. In simple words, HRD is an organized learning experience aimed at
matching the organization need for human resource with the individual needs for
career growth and development. It is a system and process involving organized
series of learning activities designed to produce behavioral changes in human
beings in such a way that they acquire desired level of competence for present or
future role.
13.2 OBJECTIVES
After reading this lesson you should be able to
Understand the Meaning of Human Resource Development
Know difference the between Education, Training and Development
Find out Training Vs Development
13.3 CONTENTS
13.3.1 Objectives of Human Resource Development
13.3.2 Features of HRD
13.3.2 Difference between Education, Training and Development
13.3.1 Objectives of Human Resource Development
The prime objective of human resource development is to facilitate an
organizational environment in which the people come first. The other objectives of
HRD are as follows:
1. Equity
Recognizing every employee at par irrespective of caste, creed, religion and
language, can create a very good environment in an organization. HRD must ensure
that the organization creates a culture and provides equal opportunities to all
employees in matters of career planning, promotion, quality of work life, training
and development.
2. Employability
Employability means the ability, skills, and competencies of an individual to
seek gainful employment anywhere. So, HRD should aim at improving the skills of
employees in order to motivate them to work with effectiveness.
115
3. Adaptability
Continuous training that develops the professional skills of employees plays an
important role in HRD. This can help the employees to adapt themselves to
organizational change that takes place on a continuous basis. The main objectives
of HRD system is to develop the following:
13.3.2 Features of HRD

1. Systematic approach
HRD is a systematic and planned approach through which the efficiency of
employees is improved. The future goals and objectives are set by the entire
organization, which are well planned at individual and organizational levels.
2. Continuous process
HRD is a continuous process for the development of all types of skills of
employees such as technical, managerial, behavioral, and conceptual. Till the
retirement of an employee sharpening of all these skills is required.
3. Multi-disciplinary subject
HRD is a Multi-disciplinary subject which draws inputs from behavioral
science, engineering, commerce, management, economics, medicine, etc.
4. All-pervasive
HRD is an essential subject everywhere, be it a manufacturing organization or
service sector industry.
5. Techniques
HRD embodies with techniques and processes such as performance appraisal,
training, management development, career planning, counselling, workers
participation and quality circles.
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Need and Significance of Human Resource Development (HRD)

HRD improves the capabilities of people by making them better aware of the
skills required for job performance and by improving clarity about
performance standards. HRD strengthens executive skills
HRD improves communication system in the organization. Every member
better understands the expectations of other members from his role.
HRD helps an organization in procuring the right people at the right time
and in making their effective use
HRD improves employee commitment to the organization due to greater
objectivity in the administration of rewards. Contributions of employees are
valued and rewarded in the better way.
HRD provides an opportunity of continuous and all round growth o f
employees through succession planning and career planning.
HRD improves collaboration and teamwork. Employees become more open
and trust each other.
HRD improves problem-solving and adaptation skills of employees. They
become more innovative, proactive and risk taking. Resistance to change is
reduced.
HRD generates a lot of useful data which facilitate human resource planning
and control
HRD ultimately leads to higher productivity, lower costs and successful
growth in the organization. Organizations which make their people grow
continuously, them grow and succeed better.
13.3.3 Difference between Education, Training and Development
The terms training, education, development and learning may often be used
interchangeably, but they can have very different, if overlapping, meanings in
117
different contexts. In terms of human resource development, it is often necessary to
define and delineate these in a bid to clarify the associated activities and
desired outcomes within an organization. Employee training, in particular, is
associated with on-the-job skills acquired for a particular role, while education is
seen as relating to a more formal academic background. However, in increasingly
complex organizations, it may be argued that aspects of each are necessary to
ensure full employee potential. In this paper, I will outline some of the traditional
definitions of these terms and their implications for human resource development,
and demonstrate how they are best viewed as interconnected.
Training
Training is often referred to as imparting specific skills and behaviour. The
specificity is in terms of learning a specific course content or skill such as a
computer language, machine operations, and playing tennis. The focus is on
improvement in performance after training along with a perceptible behavioural
change. In that sense, they differ slightly from conceptual or intellectual ones.
Training often caters to organizational needs. The training program may be
prompted because of certain changes presen t or anticipated in the structure and
processes of organizations. Hence, the impact of training may be experienced and
assessed by the organization immediately, usually, administrative, supervisory, and
technical workforce may be exposed to training programs. The banks in the
country in the early nineties had implemented advanced ledger posting machines
(ALMS) and, for this purpose, they undertook extensive training of their operational
and systems people. Similarly, now most of the public sector banks are
implementing core banking solution (CBS) and for this purpose they are training
their systems, networking, and operations personnel.
Development
Development on the other hand is holistic, often aiming at overall personality
development. The content of a development programme include4s conceptual or
theoretical inputs, perspective strategic thinki9ng or focusing on behavioural
aspects such as leadership skills and managing teams and groups. The intent is to
provide training in non-technical aspects so that individuals may discharge
organizational functions more effectively in the areas of problem solving, decision-
making, people skills, etc. Thus, we may say that training is imparted to operatives,
whereas development is a process of grooming mainly used for executives or
managers. The impact of a training program ends with learning the skill, while that
of a developmental program is a continuous and ongoing process.
The need for training the employees stems mostly from organizational
requirements, whereas the need to undergo a developmental programme is internal
that is, prompted by employees themselves. Nevertheless, in both instances,
organizations gain in terms of increased or effective performance. Yet another
distinction that may be brought about is that training serves immediate
organizational requirements, while development is futuristic and aims at growth of
both the individual and the organization.
118
Education
The different meanings and definitions of education as given above lead us to
the conclusion that education should have a comprehensive definition. Thus,
education may be defined as a purposive, conscious or unconscious, psychological,
sociological, scientific and philosophical process, which brings about the
development of the individual to the fullest extent and also the maximum
development of society in such a way that both enjoy maximum happiness and
prosperity. In Short, education is the development of individual according to his
needs and demands of society, of which he is an integral part. The above remarks of
different educators highlight the following special features of education:
Education is both unilateral as well as bi -polar in nature.
It is a continuous process.
It is knowledge or experience.
It is development of particular aspects of human personality or a
harmonious integrated growth.
It is conducive for the good of the individual or the welfare of the society.
It is a liberal discipline or a vocational course.
It is stabilizer of social order, conservator of culture, an instrume nt of
change and social reconstruction.
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1. Training: Training is often referred to as imparting specific skills and
behaviour. The specificity is in terms of learning a specific course content or
skill such as a computer language, machine operations, and playing tennis.
2. Development: Development on the other hand is holistic, often aiming at
overall personality development. The content of a development programme
include4s conceptual or theoretical inputs, perspective strategic thinki9ng or
focusing on behavioural aspects such as leadership skills and managing
teams and groups.
3. Education: The different meanings and definitions of education as given
above lead us to the conclusion that education should have a comprehensive
definition. Thus, education may be defined as a purposive, conscious or
unconscious, psychological, sociological, scientific and philosophical process
1. What is HRD? Distinguish between HRD and HRM
2. Explain the objectives and assumptions of HRD
3. Describe the need and significance of HRD
4. Explain the qualities required for a HRD Manager
13.6 SUMMARY
HRD is the continuous process of improving the capabilities required to
achieve organizational and individual goal. HRD is the broad concept of than
human resource management it consists of several sub-system such as appraisal,
counselling, training, rewards and welfare, quality of work life etc., An HRD
manager must possess behavioural, functional and managerial competencies.
1. Describe the need and significance of HRD.
2. What is HRD? Explain the Objectives of HRD.
3. Examine the features of the Human Resource Development Approach in
management.
4. Distinguish between Education, Training and Development.
1. Edwin B. Flippo, Personnel Management, Singapore: McGraw Hill Book
Company, 2002 Edition.
2. Mamoria C.B. and Gankar S.V, Personnel Management Text & Cases,
Mumbai: Himalaya Publishing House, 2003 Edition.
13.9 ASSIGNMENTS
1. Visit any two information technology companies and collect information on
how they are managing careers of their professional knowledge workers.
2. Specify the reason behind Mr.Christo Immanuvel tendering his resignation.
3. Which retention strategy could the company have employed in order to
retain him?
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1. Bernardin, J.H: Human Resource Management: An Experimental Approach,
Tata McGraw Hill, New Delhi, pp.48-50
2. Jyothi.p: Training of Trainer: Material Composed for Training Programme,
Institute of Public Enterprise, Hyderabad, pp. 48-50.
3. Pepper, A: Managing the Training and Development Function, Gower
Publishing, Aldersott, pp.48-50.
4. Rao V.S.P (2001): Human Resource Management: Text and Cases, Excel
Books, New Delhi. pp.193-212.
1. HRD or Human Resource Development can best be describe d as a
comprehensive learning system designed to enhance individual performance
for the purpose of improving organizational efficiency. As such, HRD
includes three types of learning activities: on the job, off the job, and
through the job.
2. Visit to the Commercial Bank nearer to you home town and try to
understand how the newly joined staff learning with the support of Superior.
3. Visit to the Staff Training Centres of a Bank and enquire with the trainees
how they were trained through off the job.
4. Enquire person who joined as fresher in a particular job about the training
process through the job.
Case Study
Mr.Christo Immanuvel worked in a company that belonged to the knowledge
industry. He had a brilliant educational record and used to receive pay hikes more
frequently than others in the company. In addition to his qualification, he
possessed some positive personality traits to his credit. He used to always engage
in developmental work and successfully completed them. The company recognized
the brilliant work done by him that brought substantial profits and raised its
image. One fine morning, he submitted his resignation. On receiving his
resignation, the management seemed puzzled and requested Mr.Christo Immanuvel
to withdraw his resignation. In fact, the company even promised him a promotion
and offered a further hike in salary. However, Mr. Singh refused, and ultimately
left the company.
13.12 KEYWORDS
Human Resource Development, Education, Skill Development, Executive
Development Programme, Training, Learning, Development through career.

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LESSON 14
TRAINING
14.1 INTRODUCTION
Training constitutes a basic concept in human resource development. It is
concerned with developing a particular skill to a desired standard by instruction
and practice. Training is a highly useful tool that can bring an employee into a
position where they can do their job correctly, effectively, and conscientiously.
Training is the act of increasing the knowledge and skill of an employee for doing a
particular job.
14.2 OBJECTIVES
After reading this lesson you should be able to understand
Need and Importance of training
Objectives of training
Types of training Inputs to training
Training Needs Assessment
Organization of Training Programmes
Steps in training Programme
Techniques of Training and Development
On the job training methods
Off the job training methods
Evaluation of Training Programme
14.3 CONTENTS
14.3.1 Definition of Training
14.3.2 Need for Training
14.3.3 Objectives of Training
14.3.4 Types of Training
14.3.5 Steps to Organizing Effective Training Programs
14.3.1 Definition of Training
Dale S. Beach defines training as the organized procedure by which people
learn knowledge and/or skill for a definite purpose. Training refers to the teaching
and learning activities carried on for the primary purpose of helping members of an
organization acquire and apply the knowledge, skills, abilities, and attitudes needed
by a particular job and organization. According to Edwin Flippo, training is the act
of increasing the skills of an employee for doing a particular job.
14.3.2 Need for Training
Every organization should provide training to all the employees irrespective of
their qualifications and skills. Specifically the need for training arises because of
following reasons:
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1. Environmental changes
Mechanization, computerization, and automation have resulted in many
changes that require trained staff possessing enough skills. The organization
should train the employees to enrich them with the latest technology and
knowledge.
2. Organizational complexity
With modern inventions, technological up gradation, and diversification most
of the organizations have become very complex. This has aggravated the problems
of coordination. So, in order to cope up with the complexities, training has become
mandatory.
3. Human relations
Every management has to maintain very good human relations, and this has
made training as one of the basic conditions to deal with human problems.
4. To match employee specifications with the job requirements and organizational needs
An employees specification may not exactly suit to the requirements of the job
and the organization, irrespective of past experience and skills. There is always a
gap between an employees present specifications and the organizations
requirements. For filling this gap training is required.
5. Change in the job assignment
Training is also necessary when the existing employee is pro moted to the
higher level or transferred to another department. Training is also re quired to equip
the old employees with new techniques and technologies.
Significance or Importance of Training
Training of employees and managers are absolutely essential in this changing
environment. It is an important activity of HRD which helps in improving the
competency of employees. Training gives a lot of benefits to the employees such as
improvement in efficiency and effectiveness, development of self-confidence and
assists everyone in self-management. The stability and progress of the organization
always depends on the training imparted to the employees. Training becomes
mandatory under each and every step of expansion and diversification. Only
training can improve the quality and reduce the wastages to the minimum. Training
and development is also very essential to adapt according to changing environment.
Training is given on four basic grounds:
New candidates who join an organization are given training. This training
Familiarize them with the organizational mission, vision, rules and
regulations and the working conditions.
The existing employees are trained to refresh and enhance their knowledge.
If any updation and amendments take place in technology, training is given
to cope up with those changes. For instance, purchasing a new equipment,
changes in technique of production, computer impartment. The employees
are trained about use of new equipment and work methods.
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When promotion and career growth becomes important. Training is given so
that employees are prepared to share the responsibilities of the higher level job.
The benefits of training can be summed up as:
Improves morale of employees- Training helps the employee to get job
security and job satisfaction. The more satisfied the employee is and the greater is
his morale, the more he will contribute to organizational success and the lesser will
be employee absenteeism and turnover.
Less supervision- A well trained employee will be well acquainted with the job
and will need less of supervision. Thus, there will be less wastage of time and efforts.
Fewer accidents- Errors are likely to occur if the employees lack knowledge
and skills required for doing a particular job. The more trained an employee is, the
less are the chances of committing accidents in job and the more proficient the
employee becomes.
Chances of promotion- Employees acquire skills and efficiency during
training. They become more eligible for promotion. They become an asset for the
organization.
Increased productivity- Training improves efficiency and productivity of
employees. Well trained employees show both quantity and quality performance.
There is less wastage of time, money and resources if employees are properly
trained.
14.3.3 Objectives of Training
Main Objectives of Training Programme are as follows:
1. To impart to new entrants basic knowledge and skills,
2. To assist the employees to function more effectively in their present position
by exposing them to the latest concepts, information and techniques and
developing in them the skills required in their fields,
3. To build up a second line of competent officers and prepare them as a part
of their career progression to occupy more responsible positions.
4. To broaden the minds of the senior managers by providing them
opportunities for interchange of experiences within and outside with a view
to correct the narrow outlook that may arise from over specialization.
5. To impart customer education.
14.3.4 Types of Training
Various types of training can be given to the employees such as induction
training, refresher training, on the job training, vestibule training, and training for
promotions.
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1. Orientation training
Also known as induction training given for the new recruits in order to make
them familiarize with the internal environment of an organization. It helps the
employees to understand the procedures, code of conduct, policies existing in that
organization.
2. Job instruction training
This training provides an overview about the job and experienced trainers
demonstrates the entire job. Addition train ing is offered to employees after
evaluating their performance if necessary.
3. Safety Training
Training provided to minimize accidents and damage to machinery is known
as safety training. It involves instruction in the use of safety devices and in safety
consciousness.
4. Promotional Training
It involves training of existing employees to enable them to perform higher level
jobs. Employees with potential are selected and they are given training before their
promotion, so that they do not find it difficult to shoulder the higher responsibilities
of the new positions to which they are promoted.
5. Refresher training
This type of training is offered in order to incorporate the latest development in
a particular field. This training is imparted to upgrade the skills of employees. This
training can also be used for promoting an employee.
6. Remedial Training
Such training is arranged to overcome the shortcomings in the behavior and
performance of old employees. Some of the experienced employees might have picked
up appropriate methods and styles of working. Such employees are identified and
correct work methods and procedures are taught to them. Remedial training
should be conducted by psychological experts.
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Inputs to Training
Any training and development programme must contain inputs which enable the
participants to gain skills, learn theoretical concepts and help acquire vision to look
into the distant future. The inputs of training and development are as follows:
Any training and development programme must contain inputs which enable
the participants to gain skills, learn theoretical concepts and help acquire vision to
look into the distant future. The inputs of training and development are as follows:
1) Skills
Training is imparting skills to the employees. A worker needs skills to operate
machines, and use other equipments with least damage and scrap. This is basic
skills without which the operator will not function.
There is also a need of motor skills or psychomotor skills as they are refer to
performance of specific physical activities .These skills involve learning to move
various parts of their body in response to certain external and internal stimuli.
Employees particularly like supervisors and executives, need interpersonal skills
mostly know as people skills. These skills helps a person understand oneself and
others better and act accordingly. Examples of interpersonal skills include
listening. Persuading and showing an understanding of others feelings
2) Education
The purpose of education is to teach theoretical concepts and develop a sense
of reasoning and judgment. That any training and development programme must
contain an element of education is well understood by the HR specialist.
In fact, sometimes, organizations depute or encourage employees to do courses
on a part time basis. Chief executive officers (CEOs) are known to attend refresher
course conducted in many Business schools. The late Manu Cha bria, CMD, Shaw
Wallace, attended such a two month programme at the Harvard business school.
Education is more important for managers and executives than for lower-cadre
workers.
3) Development
Another component of a training and development programme is d evelopment
which is less skill oriented but stress on knowledge. Knowledge about business
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environment, management principles and techniques, human relations, specific
industry analysis and the like is useful for better management of a company.
Development programme should help an employee to be a self-starter, build
sense of commitment, motivation, which should again help him being self-
generating. It should make their performance result oriented and help them in
being more efficient and effective. It should also help in making the employee
sensitive towards the environment that is his work place and outside. This
programme should keep the employee aware of him i.e. his potentials and his
limitations. Help him see himself as others see him and accept his self-image as a
prelude to change. It helps teach an individual to communicate without filters, to
see and feel points of view different from their own. Also helps them understand the
powers in their hands and thereby develop leadership styles which inspire and
motivate others. And finally helps install a zest for excellence, a divine discontent, a
nagging dissatisfaction with the status quo.
4) Ethics
There is a need for imparting greater ethical orientation to a training and
development programme. There is no denial of the fact that ethics are largely
ignored in businesses. They are less seen and talked about in the personnel
function this does not mean that the HR manager is absolved if the responsibility. If
the production, finance or marketing personnel indulge in unethical practices the
fault rest on the HR manager. It is his/her duty to enlighten all the employees in
the organization about the need for ethical behaviour.
5) Attitudinal Changes
Attitudinal represents feelings and beliefs an individual towards others.
Attitudes affect motivation, satisfaction and job commitment. Negative attitudes
needs to be converted into positive attitudes. Changing negative attitudes is difficult
because of,
(1) Employees refuse to change
(2) They have prior commitments and
(3) Information needed to change attitudes may not be sufficient.
Attitude must be changed so that the employee feels committed to the organization
and give better performance.
6) Decision making and problem solving skills
Decision making and problem solving skill focus on methods and techniques
for making organizational decision and solve work related problems. Learning
related to decision making and problem solving skills seeks to improve trainees
abilities to define and structure problems, collect and analysis information,
generate alternatives. Training of this type is typically provided to potential
managers, supervisors and professionals.
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Training Needs Assessment
The purpose of a training needs assessment is to identify performance
requirements and the knowledge, skills, and abilities needed by an agency's
workforce to achieve the requirements. An effective training needs assessment will
help direct resources to areas of greatest demand. The assessment should address
resources needed to fulfill organizational mission, improve productivity, and provide
quality products and services. A needs assessment is the process of identifying the
"gap" between performance required and current performance. When a difference
exists, it explores the causes and reasons for the gap and methods for closing or
eliminating the gap. A complete needs assessment also considers the consequences
for ignoring the gaps.
There are three levels of a training needs assessment
Organizational assessment evaluates the level of organizational
performance. An assessment of this ty pe will determine what skills,
knowledge, and abilities an agency needs. It determines what is required to
alleviate the problems and weaknesses of the agency as well as to enhance
strengths and competencies, especially for Mission Critical Occupation's
(MCO). Organizational assessment takes into consideration various
additional factors, including changing demographics, political trends,
technology, and the economy.
Occupational assessment examines the skills, knowledge, and abilities
required for affected occupational groups. Occupational assessment
identifies how and which occupational discrepancies or gaps exist,
potentially introduced by the new direction of an agency. It also examines
new ways to do work that can eliminate the discrepancies or gaps.
Individual assessment analyzes how well an individual employee is doing a
job and determines the individual's capacity to do new or different work.
Individual assessment provides information on which employees need
training and what kind.
The Training Needs Assessment Process
Determine Agency Benefits of Needs Assessment- this part of the process
will sell and help the decision makers and stakeholders understand the concept of
the needs assessment. Needs assessment based on the alignment of critical
behaviors with a clear agency mission will account for critical occupational and
performance requirements to help your agency: a) eliminate redundant training
efforts, b) substantially reduce the unnecessary expenditure of training dollars, and
c) assist managers in identifying performance requirements that can best be
satisfied by training and other developmental strategies. To go beyond learning and
actually achieve critical behaviors the agency will also need to consider how
required drivers will sustain desired outcomes.
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Key steps include:
Identify key stakeholders
Solicit support
Describe desired outcomes that will contribute to mission objectives
Clarify critical behaviors needed to achieve desired outcomes
Define required drivers essential to sustain the critical behaviors
1. Plan - The needs assessment is likely to be only as successful as the
planning.
Set goals/objectives for the needs assessment
Evaluate organizational (agency) readiness and identify key roles
Evaluate prior/other needs assessments
Prepare project plan
Inventory the capacity of staff and technology to conduct a meaningful
training skills assessment and analysis
Clarify success measures and program milestones
2. Conduct Needs Assessment
Obtain needs assessment data (e.g., review strategic plans, assess HR
metrics, review job descriptions, conduct surve ys, review performance
appraisals)
Analyze data
Define performance problems/issues: occupational group/individuals
Describe critical behaviours needed to affect problems/issues
Determine and clarify why critical behaviours do not currently exist
Research integrated performance solutions
If training is the best solution, determine best training and development
approach(es)
Assess cost/benefit of training and development approach(es); build a
"business case"
Include organizational drivers needed to reinforce the critical behaviors
that will affect problems/issues
Describe how the critical behaviors will be monitored and assessed after
implementation of the improvement plan
The results of the needs assessment allows the training manager to set the
training objectives by answering two very basic questions: what needs to be done,
and why is it not being done now? Then, it is more likely that an accurate
identification of whom, if anyone, needs training and what training is needed.
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Sometimes training is not the best solution, and it is virtually never the only
solution. Some performance gaps can be reduced or eliminated through other
management solutions, such as communicating expectations, providing a
supportive work environment, and checking job fit. These interventions also are
needed if training is to result in sustained new behaviors needed to achieve new
performance levels, for an individual, an occupation, or an entire organization.
14.3.5 Steps to Organizing Effective Training Programs
An effective training program is built by following a systematic, step-by step
process. Training initiatives that stand alone (one-off events) often fail to meet
organizational objectives and participant expectations. In todays post we outline
the five necessary steps to creating an effective program.
1) Assess Training Needs: The first step in developing a training program is to
identify and assess needs. Employee training needs may already be established in
the organizations strategic, human resources or indivi dual development plans. If
youre building the training program from scratch (without predetermined
objectives) youll need to conduct training needs assessments.
2) Set Organizational Training Objectives: The training needs assessments
(organizational, task & individual) will identify any gaps in your current training
initiatives and employee skill sets. These gaps should be analyzed and prioritized
and turned into the organizations training objectives. The ultimate goal is to bridge
the gap between current and desired performance through the development of a
training program. At the employee level, the training should match the areas of
improvement discovered through 360 degree evaluations.
3) Create Training Action Plan: The next step is to create a comprehensive
action plan that includes learning theories, instructional design, content, materials
and any other training elements. Resources and training delivery methods should
also be detailed. While developing the program, the level of training and
participants learning styles need to also be considered. Many companies pilot their
initiatives and gather feedback to make adjustments before launching the program
company-wide.
4) Implement Training Initiatives: The implementation phase is where the
training program comes to life. Organizations need to decide whether training will
be delivered in-house or externally coordinated. Program implementation includes
the scheduling of training activities and organization of any related resources
(facilities, equipment, etc.). The training program is then officially launched,
promoted and conducted. During training, participant progress should be
monitored to ensure that the program is effective.
5) Evaluate & Revise Training: As mentioned in the last segment, the
training program should be continually monitored. At the end, the entire program
should be evaluated to determine if it was successful and met training objectives.
Feedback should be obtained from all stakeholders to determine program and
instructor effectiveness and also knowledge or skill acquisition. Analyzing this
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feedback will allow the organization to identify any weaknesses in the program. At
this point, the training program or action plan can be revised if objectives or
expectations are not being met.
1. Training: Training refers to the teaching and learning activities carried on
for the primary purpose of helping members of an organization acquire and
apply the knowledge, skills, abilities, and attitudes needed by a particular
job and organization.
2. Types of Training: Various types of training can be given to the employees
such as induction training, refresher training, on the job training, vestibule
training, and training for promotions.
3. Inputs to training: Any training and development programme must
contain inputs which enable the participants to gain skills, learn theoretical
concepts and help acquire vision to look into the distant future.
1. An HR manager conducts new employee orientation for a large organization .
His/her work is within which basic HRM function?
a. Management
b. Motivation
c. Career planning
d. Training and Development
3. Employee involvement require extensive additional HRM activity in which of
these areas?
a. Training
b. Benefits
c. Labour negotiation
d. Marketing
4. The cost associated with employee separation and turnover includes
a. Recruitment and selection costs
b. Training cost
c. Separation cost
d. all of these
5. Training instruction for a small group, which employs techniques such as
role-playing or simulation and involves give-and-take session and problem
solving techniques, is called:
a. Career counselling
b. Workshop
c. Development plan
d. d)on-the-job orientation
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6. Which of the following measures is taken to access employees satisfaction
and their attitude towards the training programme?
a. Continuous feedback
b. Profitability rate
c. Market share
d. Productivity levels
7. Evaluation of training programme is conducted:
a. At the initial stage while designing the training programme
b. Prior to the need assessment phase
c. Parallel to designing the training content
d. At the last stage of training
14.6 SUMMARY
This chapter defined the utility and purposes of training, the levels of training,
the need and importance of training and the benefits of training to the individual
and the organization. It expounds on the philosophy of training, learning curve and
plateaus, approaches to training programme, identification of training needs in an
organization at group and individual levels, dynamics of organization of training,
purposes or objectives of training etc.,
1. Discuss the methods of training that are used for training the operative
employees.
2. Discuss the various types of training programmes prevalent in the industry.
3. What are the objectives of employee training? Explain the need for training
in modern industry.
4. What are the three levels at which training and development needs
assessment can be made?
5. Explain the essential steps of a good training programme.
6. What are the process of training needs and asse ssment?
7. Describe training inputs.
1. Richard T. DeGeorge, Business Ethics, New York: Macmillan Publishing
Company, 3, 1990 Edition.
2. Meredith J.R., The Management of Operations, New York: John Wiley &
sons, 4, 1992 Edition.
3. Sangeetha Jain, Quality of Work Life (QWL), New Delhi: Deep and Deep
Publications, 1991 Edition.
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14.9 ASSIGNMENTS
1. Visit the training department, collect the training calendar, and choose a
training programme from the calendar. Also collect the syllabus, brochure,
and prepare the objectives wise time and facility required. Approach the
training manager, take his appointment, and meet him to discuss what you
have prepared. Request him to scrutinize and carefully observe his facial
expression. Thereafter, collect his views about the usefulness of the same.
Do you feel that you would succeed in getting this system implemented?
2. Visit an organization that has a training department. Find out how they
evaluate their training programme. If the training department is using Jack
Phillips ROI approach, record the data they are collecting. Further note to
what extent the organization is getting returns from training. Analyze all the
information, finalize your findings, and suggest the training department
suitably.
1. Aswathappa.K: Human Resource Management, Tata McGraw Hill Publishing
Co. Ltd., New Delhi
2. John H. Bernardian and Joyce E.A Russel: Human Resource Management
An Experimental Approach, McGraw Hill, New York
3. Bhusan, Y.K. (1988):Training and development, concepts and practices,
New Delhi: Deep and Deep publication Pvt. Ltd..
4. Titus (2011):Training and Human Resources Development: An Experience in
Symbiosis. In Alternative approaches and strategies of Human Resources
Development
5. Randall, S.Schuler,(2010):Effective Personnel Management, West Publishing,
New York
6. Rao VSP: (2010) Human Resource Management, Excel Books, New Delhi
Work Related Learning (WRL) is defined as: "planned activity that uses the
context of work to develop knowledge, skills and understanding useful in work
(QCA) WRL is a comprehensive and programme offered to education
establishments. The aim is to ensure young people get the appropriate information,
advice and guidance and careers advice so they leave education with the skills they
need to achieve their career aspirations. The events are supported by a wide variety
of local and national employers. Work related learning activities have considerable
benefits for both students and employers who support these events. The activities
allow students to understand the relevance of their school subjects to working life
and inspires them to succeed at school to gain employability skills and achieve
their future goals. For employers, getting involved offers opportunities to promote
their organisation in the local community and provides training and development
opportunities for their staff. It offers employers the opportunity to input into the
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school curriculum and ensure that future employees have the skills employers are
looking for.
Case Study
The President of the Academy Employment Service has inaugurated a
Management of Objectives program in order that more accurate appraisals may be
made of professional personnel. Frank Bank, an employment interviewer, has for
the past year established relations with Small Business College, a privately run
school in the southern part of the state. It graduates about 25 people per month
and bank had agreed to place as many of those who wanted placement in training-
related jobs. Between 15 and 20 people per month signed up for this service.
When the President asked Bank to prepare objectives for his job, this seemed to be
one of the easy places to do it. In as much as Bank was now placing about 35
percent of the applications, the president asked if he thought he could raise this to
50 percent. Bank assured him that he could. In reviewing Banks
accomplishments at the end of the 6-month period, it was concluded by the
personnel unit that Bank was placing only 5 to 7 percent of the graduates in
training related jobs. Several lengthy and heated discussions took place regarding
just what was meant by training related, while the personnel unit contented that
the job content had to bear some relationship to the training acquired in school.
Moreover, if the placed student quite before 90 days of work, the personnel unit
would not classify this as a successful placement. Continuous documentation of
Banks to 7 percent performance against the 50 percent objective led to Banks
serious consideration of early retirement.
1. Is this objective a well stated one? Why or why not?
2. If you were the president, how would you re solve the dispute between and
the personnel unit?
14.12 KEYWORDS
Training, Methods of training, types of training, on the job training, off the job
training, training needs, training evaluation, training for executives.

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LESSON 15
METHODS OF TRAINING
15.1 INTRODUCTION
A large variety of methods of training are used in business. Even within one
organization different methods are used for training different people.
15.2 OBJECTIVES
On the job Training Methods
Off the-job Training Methods Training and Development in India
Evaluation of Training Programmes
Training Institutes
Government Policy
15.3 CONTENTS
15.3.1 Training Methods
15.3.2 On-the-Job Training Methods
15.3.3 Off-the-Job Training Methods
15.3.4 Evaluation of Training Programmes
15.3.5 Methods of Evaluation
15.3.6 Retraining
15.3.7 Training and Development in India
15.3.1 Training Methods
All the Training methods are divided into two broad classifications. They are
listed below :
A. On-the-job Training Methods B. Off-the-Job Training Methods

1. Coaching 1. Lectures and Conferences
2. Mentoring 2. Vestibule Training
3. Job Rotation 3. Simulation Exercises
4. Job Instruction Technology 4. Sensitivity Training
5. Apprenticeship 5. Transactional Training
6. Understudy
15.3.2 On-the-Job Training Methods
Under these methods new or inexperienced employees learn through observing
peers or managers performing the job and trying to imitate their behaviour. These
methods do not cost much and are less disruptive as employees are always on the
job, training is given on the same machines and experience would be on already
approved standards, and above all the trainee is learning while earning. Some of
the commonly used methods are:
1. Coaching
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Coaching is a one-to-one training. It helps in quickly identifying the weak
areas and tries to focus on them. It also offers the benefit of transferring theory
learning to practice. The biggest problem is that it perpetrates the existing practices
and styles. In India most of the scooter mechanics are trained only through this
method.
2. Mentoring
The focus in this training is on the development of attitude. It is used for
managerial employees. Mentoring is always done by a senior inside person. It is
also one-to- one interaction, like coaching.
3. Job Rotation
It is the process of training employees by rotating them through a series of
related jobs. Rotation not only makes a person well acquainted with different jobs,
but it also alleviates boredom and allows to develop rapport with a number of
people. Rotation must be logical.
4. Job Instructional Technique (JIT)
It is a Step by step (structured) on the job training method in which a suitable
trainer (a) prepares a trainee with an overview of the job, i ts purpose, and the
results desired, (b) demonstrates the task or the skill to the trainee, (c) allows the
trainee to show the demonstration on his or her own, and (d) follows up to provide
feedback and help. The trainees are presented the learning material in written or by
learning machines through a series called frames. This method is a valuable tool
for all educators (teachers and trainers). It helps us: a. To deliver step-by-step
instruction b. To know when the learner has learned and c. To be due diligent (in
many work-place environments).
5. Apprenticeship
Apprenticeship is a system of training a new generation of practitioners of a
skill. This method of training is in vogue in those trades, crafts and technical fields
in which a long period is required for gaining proficiency. The trainees serve as
apprentices to experts for long periods. They have to work in direct association with
and also under the direct supervision of their masters.
The object of such training is to make the trainees all-round craftsmen. It is an
expensive method of training. Also, there is no guarantee that the trained worker
will continue to work in the same organisation after securing training. The
apprentices are paid remuneration according the apprenticeship agreements.
6. Understudy
In this method, a superior gives training to a subordinate as his understudy
like an assistant to a manager or director (in a film). The subordinate learns
through experience and observation by participating in handling day to day
problems. Basic purpose is to prepare subordinate for assuming the full
responsibilities and duties.
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15.3.3 Off-the-Job Training Methods
Off-the-job training methods are conducted in separate from the job
environment, study material is supplied, there is full concentration on learning
rather than performing, and there is freedom of expression. Important methods
include:
1. Lectures and Conferences
Lectures and conferences are the traditional and direct method of instruction.
Every training programme starts with lecture and conference. Its a verbal
presentation for a large audience. However, the lectures have to be motivating and
creating interest among trainees. The speaker must have considerable depth in the
subject. In the colleges and universities, lectures and seminars are the most
common methods used for training.
2. Vestibule Training
Vestibule Training is a term for near-the-job training, as it offers access to
something new (learning). In vestibule training, the workers are trained in a
prototype environment on specific jobs in a special part of the plant. An attempt is
made to create working condition similar to the actual workshop conditions. After
training workers in such condition, the trained workers may be put on similar jobs
in the actual workshop. This enables the workers to secure training in the best
methods to work and to get rid of initial nervousness. During the Second World War
II, this method was used to train a large number of workers in a short period of
time. It may also be used as a preliminary to on-the job training. Duration ranges
from few days to few weeks. It prevents trainees to commit costly mistakes on the
actual machines.
3. Simulation Exercises
Simulation is any artificial environment exactly similar to the actual situation.
There are four basic simulation techniques used for imparting training:
management games, case study, role playing, and in -basket training.
(a) Management Games
Properly designed games help to ingrain thinking habits, analytical, logical and
reasoning capabilities, importance of team work, time management, to make
decisions lacking complete information, communication and leadership capabilities.
Use of management games can encourage novel, innovative mechanisms for coping
with stress.
Management games orient a candidate with practical applicability of the
subject. These games help to appreciate management concepts in a practical way.
Different games are used for training general managers and the middle
management and functional heads executive Games and functional heads.
(b) Case Study
Case studies are complex examples which give an insight into the context of a
problem as well as illustrating the main point. Case Studies are trainee centered
activities based on topics that demonstrate theoretical concepts in an applied
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setting. A case study allows the application of theoretical concepts to be
demonstrated, thus bridging the gap between theory and practice, encourage active
learning, provides an opportunity for the development of key skills such as
communication, group working and problem solving, and increases the trainees
enjoyment of the topic and hence their desire to learn.
(c) Role Playing
Each trainee takes the role of a person affected by an issue and studies the
impacts of the issues on human life and/or the effects of human activities on the
world around us from the perspective of that person. It emphasizes the real- world
side of science and challenges students to deal with complex problems with no
single right answer and to use a variety of skills beyond those employed in a
typical research project. In particular, role -playing presents the student a valuable
opportunity to learn not just the course content, but other perspectives on it. The
steps involved in role playing include defining obje ctives, choose context & roles,
introducing the exercise, trainee preparation/research, the role -play, concluding
discussion, and assessment. Types of role play may be multiple role play, single
role play, role rotation, and spontaneous role play.
(d) In-basket training
In-basket exercise, also known as in-tray training, consists of a set of business
papers which may include e-mail SMSs, reports, memos, and other items. Now the
trainer is asked to prioritize the decisions to be made immediately and the ones
that can be delayed.
4. Sensitivity Training
Sensitivity training is also known as laboratory or T-group training. This
training is about making people understand about themselves and others
reasonably, which is done by developing in them social sensi tivity and behavioural
flexibility. It is ability of an individual to sense what others feel and think from their
own point of view.
It reveals information about his or her own personal qualities, concerns,
emotional issues, and things that he or she has i n common with other members of
the group. It is the ability to behave suitably in light of understanding. A groups
trainer refrains from acting as a group leader or lecturer, attempting instead to
clarify the group processes using incidents as examples to clarify general points or
provide feedback. The group action, overall, is the goal as well as the process.
5. Transactional Analysis
It provides trainees with a realistic and useful method for analysing and
understanding the behaviour of others. In every social interaction, there is a
motivation provided by one person and a reaction to that motivation given by
another person. This motivation reaction relationship between two persons is
known as a transaction. Transactional analysis can be done by the ego (system of
feelings accompanied by a related set of behaviours states of an individual).
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15.3.4 Evaluation of Training Programmes
It is necessary to evaluate the extent to which training programmes have
achieved the aims for which they were designed. Such an evaluation would provide
useful information about the effectiveness of training as well as about the design of
future training programmes. Evaluation enables an organization to monitor the
training programme and also to update or modify in future programmes of training.
Evaluation of training effectiveness is the process of obtaining information on the
effects of a training programme and assessing the value of training in the light of
that information. Training effectiveness can be measured in terms of the following
criteria:
15.3.5 Methods of Evaluation

There are so many methods used to evaluate the training programmes the
following are some of the prominent:
The opinions and judgments of trainers, superiors and peers
Asking the trainees to fill up evaluation forms
Using a questionnaire to know the reactions of trainees
Giving oral and written tests to trainers to ascertain how far they have learnt
Arranging structured interviews with the trainees
Studying profits and career development charts of trainees
Studying profiles and career development charts of trainees
Measuring level of productivity, wastage, costs, absenteeism and employee
turnover after training
15.3.6 Retraining
Retraining is the process of providing training to persons who underwent
training earlier in their job. Retraining programme are generally arranged for
employees who have long been in the service of an organization. Such programmes
are designed to avoid obsolescence of a person in terms of job requirements.
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15.3.7 Training and Development in India
Indian organizations have realized the significance of corporate training.
Training is considered as more of a retention tool than as a cost to the organizati on.
Not only have organizations increased their investment in training and development
practices, but they have also systematized training policies and practices right from
the training need analysis to training evaluation and feedback. Today, human
resource is a foundation of competitive advantage for all organizations. Therefore,
the training system in the Indian industry has been distorted to create a smarter
workforce and yield the best results. The optimum utilization of human resource is
the target of any company and training is a tool to increase business outcomes. It is
required in each area of company like sales, marketing, human resource,
relationship building, logistics, production, etc.
Since 2003, for using training function as a strategic business tool, American
Society for Training and development (ASTD) gives honor to those organizations
that show organization-wide achievement. It is proud for the nation that Indian
organizations are participating and are awarded every year by ASTD for
representing excellence in training function. In the year 2008, four organizations
from India were able to get entry in the winner list of 40 best organizations. These
organizations were: Reliance Industries Limited, Nagothane manufacturing division
having strength of
2,157 employees, Infosys Technologies Limited having 79,016 employees,
Wipro Limited having 60,000 employee strength, and ICICI Bank Limited with
employee strength of 40,880. This is an optimistic sign which clearly shows that
organizations operating in India are also very serious about their learning and
development function. They are giving priority to this area and are able to integrate
it their organizational goals. In fact, the top management is taking interest in
mentoring and leadership. For example, Narayana Murthy of Infosys is now acting
as Chairman of the board as well as Chief Mentor. In this way, they prepare the
next generation leaders for the company.
Exhibit: Modern Training Techniques
Modern Training Techniques Hallmarks
1. Ice Breakers Games to get team members know each other.
2. Leadership Games Exercise to teach different styles of leadership.
3. Skill Games Tests to develop analytical skills.
4. Communication Games Exercises to build bias-free listening and talking
skills.
5. Strategic Planners Games to test the ability to plan ahead.
6. Team Building Games Exercises requiring collaborative efforts.
7. Role Reversal Games Brings out ideas that are not often expressed.
8. Doubling Brings out ideas that are not often expressed.
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Modern Training Techniques Hallmarks
9. Tag Teams One role played alternately by two participants.
10. Mirroring Training with an external perspective.
11. Monodrama Insight into a given situation.
12. Shifting Physical Positions Highlighting communication problems.
13. Structured Role Playing Role play with predetermined objectives.
14. Multiple Role Playing Providing a conman focus of discussion.
15. Built-in-tension Teaching the importance of resolving matters.
16. Shadowing Working under a senior to watch and learn.
17. Outward Bound Training Adventure sports for teams.
18. 9+1+23 Self-assessment by a leader of leadership skills.
19. Lateral Thinking Thinking randomly to come up with new ideas.
20. Morphological Analysis Listing of alternative solutions to problems.
21. Gordon Technique Steering a discussion to crystallize solution.
22. Attribute Listening Isolation, selection and evaluation of a problem.
23. Cross-cultural Training Programs to teach specifies of varied cultures.
Source: Business Today, January 7-21; 96
Aditya Birla Group
In all multinational companies of India, Aditya Birla Group is the most
renowned. It is truly a value-based company and its vision and mission are rooted
in Indian values. The group is driven by performance ethic pegged on value creation
for its multiple stakeholders. Its core values are integrity, leading change,
excellence, respect for individual learning and sharing. This is one of the companies
that believes in the trusteeship concept of management. To increase the kn owledge
and skills of employees, this group has established a centre in Navi Mumbai
known by the name Gyanodaya. Gyanodaya has been envisioned as a hu b, the
backbone of a process that sharpens the groups competitive edge. Closely linked to
the vision of the group is the Gyanodaya vision: To be at the core of an effective
learning network that, as a strategic business partner, harnesses knowledge and
intellectual capital, to contribute to Aditya Birla Groups vision of being a premium
conglomerate.
There are two ways of learning at this centre:
1. G-learning which takes place at Gyanodaya. The training calendar is
accessible to employees via Aditya Disha, the group-wide intranet.
Participants can choose the program that they would like to participate in.
2. E-learning where learning is just a click away. The training program of
Gyanodaya is classified as:
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Multi-tier Program: In this program, the need of individual is fulfilled at
different aspects. Training is provided in the aspect of leadership for young and
general managers.
Functional Program: Sales and customer satisfaction are the ultimate goal of
any profit-making organization. To fulfil this goal, Gyanodaya organizes this
program. In this program, skills are developed for better sales and marketing.
Besides this, the program focuses on the supply chain management.
Role-specific Program: The role of an individual is very important for the
success of any team. In this aspect, Gyanodaya organizes program to develop the
competencies for individuals like marketing-head, unit-head, HR-head.
Business-focused Program: This training program is designed for generating
awareness regarding the current practices, needs, and issues to a particular
business.
The Gyanodaya Scorecard: Since its inception in January 2000, Gyanodaya
has notched up many achievements: 190 learning events; 3,920 participants; 215
external trainers; 50 internal managers as faculty; and a customer rating of 3.73 on
a 4-point scale.
Infosys
Infosys Technologies Ltd. headquartered in Bangalore, provides Information
Technology (IT) consulting and software services to clients globally as partners to
conceptualize and realize technology-driven business transformation initiatives. It
is very essential for the company to upgrade its workforce regularly to compete in
the global market. Retention of employees is the biggest challenge for every
company. To overcome this challenge, Infosys provides training and development
opportunities to its employees right from the start. The company has bagged many
awards from ASTD as the worlds best company for providing best training and
development opportunities to the employees. The company is known best for its
Global Business Foundation School which runs the program for all fresh
engineering graduates who join Infosys and prepare them for the technical and
environmental opportunities present in the market. The Global Business
Foundation School has various centres all over the world.
Infosys U
Infosys has achieved awards for its Global Education Center which was set up
in 2005. This centre provides training not only in technical skills but also in soft
skills. It also provides leadership program to new entrants to develop leadership
qualities. New engineering recruits undergo a 14.5 weeks Initial Learning Program
operated by the company. This aims to transform engineers from diverse disciplines
into software professionals and initiates them into the Infosys way of life.
Training Activities at Infosys
After joining Infosys, induction is given to the employees, addressed by NR
Narayana Murthy by an audio visual presentation. During the program, the new
hires are groomed to shed their campus frivolousness and assume their new roles
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as professionals and corporate citizens. In the induction program, the core values of
company are presented before the employees. In the company, technical as well as
soft skills have its own significance. The main focus of the company is always on
developing technical skills but they also give emphasis on various skills like
leadership qualities, global business etiquette, interpersonal skills, communication
skills, management skills, analytical skills, decision making, etc.
Syndicate Bank
Training is one of the most important interventions for developing human
resource. For this, Syndicate Banks first step is to analyse the training
needs of the employees. For the analysis of training needs they adopt
scientific methods. The second step is to make a tailored training program
for senior officials of the bank. In this two institutes play a major role
Syndicate Institute of Bank Management (SIBM) and Apex Training Institute
of the Bank of Manipal. The training centres of the
1. The training for next-generation team leaders
2. Training on communication and interpersonal skills
3. Yellow and green belt certification to train them in problem-solving and
quality improvement aspects
4. Training for first-time managers
5. Training for process trainers and quality analysts
6. Training calendar for training needs identification (TNI) of employees
7. On-the-job training on management information (MI) reporting and
people management for tenured customer service executives (CSEs)
8. Coaching service executives (CSEs)
9. Voice and accent training: The company trains the new hires on the
voice, accent, and culture of the regions to which they would be
providing contact services
10. Technical/product training: After the new hires clear the voice and
accent training, the company trains them in the product/service to
ensure that they are empowered with required product knowledge.
11. Coaching and mentoring skills for tenured CSEs to train new hires
Banks are present in the major cities of India like Bangalore, Delhi, Mumbai,
Chennai, Ernakulum, Hyderabad, and Kolkata. These centres are well -equipped
with all the latest technology and facilities, and are responsible for providing
training to the junior level officers and workmen employees. (Syndicate Bank
Annual Report, 2007-2008, p: 32)
Essar Corporate University (ECU)
Essar is a very prestigious and renowned group, awarded by ISTD in 2009 for
its innovative training practices. It is famous for its ECU which is a virtual learning
organization and takes various steps for the training and development of the
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employees. The main goals of the program are to emphasize working in teams,
develop networking and bonding, develop trust and explore risk -taking. The
company has also established Essar learning centre at Hazira which organizes
around 400 formal training programs per year on subjects ranging from
industrialized operations, general management, and logistics management. The
company runs different types of learning programs for employees, like they have
individual learning program in which an individual is responsible for his o wn
learning. E-modules are provided by Learning Management System (LMS) regarding
technical and management aspects to employees to make them aware about latest
management and technical skills.
Accenture
An organization has to be a learning organization for survival in the present
era of liberalization, privatization, and globalization. Therefore, knowledge is the
only core competence of organizations for coping with changes. In this line with the
above philosophy, among other like institutionalizing learning centres in divisions,
Accenture has also introduced the program Leaders teaching leaders. In this
program, Accenture leaders share their past experiences for the betterment of the
working styles of the present employees. Its education programs have been well-
known and appreciative around the business world. For the bright future of the
employees, Accenture provides its global portal My learning in which 20,000 online
courses are available. For this kind of activities, Accenture won prestigious awards
such as the CLO Magazine Gold Award for Leading Business Change. When a new
entrant joins the company, the candidate is guided and mentored by leaders and
colleagues under a well-defined mentoring program.
IBM
IBM is a company that gives value to the le arning and development of its
employees since 1915. It has a separate and distinct IBM education department
which was established to train and develop employees. IBM is known for the use of
e-learning programs to address its learning solutions. The learning approaches
used in IBM programs are learning from interaction, simulation or games,
collaborative learning, etc. IBM is also well -known for its program IBM
Connections. The goal of this learning empowerment program is to bring new hires
to classroom for collaboration and networking, rather than having them gather for a
less-than-engaging lecture.
Government Policy and Training and Skill Development
Skill development and entrepreneurship efforts across the country have been
highly fragmented so far. As opposed to developed countries, where the percentage
of skilled workforce is between 60% and 90% of the total workforce, India records a
low 5% of workforce (20-24 years) with formal vocational skills. There is a need for
speedy reorganization of the ecosystem of skill development and entrepreneurship
promotion in the country to suit the needs of the industry and enable decent
quality of life to its population.
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Today, more than 20 Ministries/Departments run 70 plus schemes for skill
development in the country. However, there are gaps in the capacity and quality of
training infrastructure as well as outputs, insufficient focus on workforce
aspirations, lack of certification and common standards and a pointed lack of focus
on the unorganized sector.
Recognizing the need and urgency of quickly coordinating the efforts of all
concerned stakeholders in the field of Skill Development and Entrepreneurship,
Government of India notified the formation of the Department of Skill Development
and Entrepreneurship on 31st July, 2014 which subsequently led to the creation of
the Ministry of Skill Development and Entrepreneurship on 10th Nov, 2014. The
important milestones in the formation and set up of the new Ministry are as below:
8th December, 2014 : Office of the Ministry of Skill Development and
Entrepreneurship shifted to 2nd Floor, Shivaji Stadium Annexe Building,
Connaught Place
10th November, 2014: Ministry of Skill Development and Entrepreneurship is
Created and Shri Rajiv Pratap Rudy takes oath as new Minister of S tate
(independent charge) of the Ministry.
18th September, 2014: Committee of Secretaries held for accommodation
and creation of post for the new Department.
2nd September, 2014: Secretary, Mr. Sunil Arora joins the Ministry as the
first Secretary with independent charge.
31st July, 2014 : Notification of Allocation of Business Rules listing the
business of the Ministry of Youth Affairs, Sports, Skill Development and
Entrepreneurship
Based on the mandate under the Allocation of Business Rules and taking into
account the requirements of multiple stakeholders, the following four outcomes to
be achieved have been identified:
Ensure youth emerging from formal education are employable with job or
self-employment oriented skills
Ensure people stuck in low income jobs and in the unorganised segments
can access growth opportunities through up-skilling / re-skilling and
Recognition of Prior Learning (RPL)
Improve su pply and quality of the workforce for industry, contributing to
increased productivity
Make skilling aspirational for youth
To achieve these outcomes, a framework built on five central pillars
representing the core requirements for skilling has been conceived by the Ministry
to create a pipeline of skilled people, correct supply for demand, Certify
global/common standards, and Connect supply with demand and Catalyse
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entrepreneurship. These five pillars will be supported by cross-cutting enabling
measures.
Common norms and metrics on inputs, outcome measures and funding for
skill development schemes across Central Ministries/Departments are being
developed by the Ministry. Skill gap studies for all high priority sectors including
key manufacturing sectors under Make in India have also been initiated. Support to
States has been extended via the State Skill Development Mission through funding
and technical support to ramp up capacity and improve standards of skilling at the
State level. A number of other initiatives such as collaborating with other nations to
adopt international best practices, revamping the vocational education framework
in the country, partnering with corporate, leveraging public infrastructure for
skilling, creating a pipeline of quality trai ners and leveraging technology for skill
training, are being pursued by the Ministry.
1. Job Instructional Technique (JIT) : It is a Step by step (structured) on the
job training method in which a suitable trainer (a) prepares a trainee with an
overview of the job, its purpose, and the results desired, (b) demonstrates
the task or the skill to the trainee, (c) allows the trainee to show the
demonstration on his or her own, and (d) follows up to provide feedback and
help
2. Simulation Exercises: Simulation is any artificial environment exactly
similar to the actual situation. There are four basic simulation techniques
used for imparting training: management games, case study, role playing,
and in-basket training.
3. Retraining: Retraining is the process of providing training to persons who
underwent training earlier in their job.
1. Briefly analyse the training strategies of Aegis BPO
2. Compare the training and developmental initiatives at other BPO in the
country
3. Suggest changes (if any) to the training strategy of the organization
15.6 SUMMARY
Training is the process of increasing knowledge and skill for a specific job. It
differs from but it related with education and development. Job needs, technical
progress, organizational changes, and internal mobility etc., require training.
Training provides advantages of higher productivity, better quality, less learning
period, cost reduction, less supervision, less accidents, high morale, personal
growth and organizational climate. Training is beneficial to employees in the form of
self-confidence, higher earnings, safety, adoptability, promotion and new skills.
Orientation, job safety, promotional, refresher and remedial are types of training.
Identification of training needs requires analysis of organization, objectives,
resources, environment, tasks and manpower. Responsibility assignment, selection
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and motivation of trainees, preparing trainers, developing the package,
presentations, performance tryout, and follow-up are the main steps in a training
programme. There are two methods of job training offered to the employees are on
the job training and off the job training. Evaluation of training is necessary and it
can be made on the basis of reactions, rearing, behavior and performance. Clear
objectives, proper policy, motivation, reinforcement, organized material, long period
prepared instructions, feedback, practice and appropriate techniques are the
principles of effective training. Retraining is necessary due to changes in jobs,
technology and the environment.13.7 TERMINAL EXERCISE
1. What are the classifications of training methods?
2. Evaluation of training programme explain.
3. Discus various methods of evaluation.
4. Business needs are the driving forces of a training programme. Justify the
statement citing examples of a few business needs
5. Discuss various steps of developing the syllabus of a new course. Prepare
an exhaustive list of information you would collect in this regard.
Company, 3, 1990 Edition
2. Edwin B. Flippo, Personnel Management, Singapore: McGraw Hill Book
Company, 2002 Edition.
3. Michael W. Drafke and Stan Kossen, The human side of organization s,
New Delhi: Prentice Hall of India, 8, 2002 Edition
15.9 ASSIGNMENTS
1. Discuss the role and characteristics of a trainer. How can a trainer develop
these characteristics?
2. What is training validation? Discuss the means of validating a training
programme. Cite examples.
3. Explain the philosophy of training and the need of training for contemporary
organization
4. Distinguish between training and development and between training and
education
5. Explain the purposes of training with examples from your real-life-
experiences
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1. Agarwala, Tanuja, Strategic Human Resource Management, Oxford
University Press, New Delhi, 2007
2. Hamblin, A.C. The Evaluation and Control of Training, McGraw Hill
(European Series in Management) UK, 1974
3. Philips, Jack J: Handbook of Training Evaluation and Measurement
Methods, Elsevier, Australia
4. Reddy, Rathan B.: Effective Human Resource Training and Development
Strategy, Himalaya Publishing House, New Delhi 2005
5. Patra, Rima: Assessment of Training Needs in Allahabad Bank, Kolkata,
prepared and submitted to Indian Institute of Social Welfare and Business
Management, Calcutta University, 2009.
1. Visit to a MNCs located in your area and try to find out the methods adopts
by them for evaluating the performance of the employees. Identify the
positives and negatives of present system of performance appraisal in that
particular company.
Self-Evaluation Questions
Case Study
Training and Development in Aegis BPO Limited
Aegies BPO is a subsidiary of Essar Grou p, a multi -billion dollar group with
interest in steel, oil, telecom, and shipping across several countries in the world.
Aegis is listed in the US and operates in India, US, and Philippines. Though aegis
started as an international BPO, considering the emerging opportunities in the
domestic BPO space, it has ventured into telecom, banking and insurance verticals
by entering in to service contracts with leading players such as Airtel, Idea, HDFC
Insurance, and ICICI Babk. The organization has grown to 17 centres in India with
over 20,000 employees. It has another 15,000 employees across US and
Philippines. The company, which has been recriting close to 4,000 employees
across its sites for replacement, has drawn a compre hensive training and
development strategy to train and develop its employees.
Training for new hires: for the new hires, the company has the following two
kinds of training.
Training for tenured Employees: In order to address the developmental
aspiration, the organization has drawn a detailed plan as follows:
These training initiatives have not only helped Aegis to reduce early attrition,
but also address the developments aspirations of the tenured employees.
15.12 KEYWORDS
Training, types of training, training methods, training evaluation, training and
development, training and technology, training executives, training and learning.

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LESSON 16
MANAGEMENT DEVELOPMENT PROGRAMMES(MDP)
16.1 INTRODUCTION
Management Development Programme is the process adopted to supply
knowledge, skills, attitudes, and insights to managerial personnel, and help them
manage their work effectively and efficiently. Management development is the
systematic process of training and growth with the ultimate purpose of
organizational growth. In management development programmes, the faculty
members share their experiences in organizational context using anecdotes relevant
to the development programmes.
16.2 OBJECTIVES
Management Development Programmes
Essentials of Management Development Programmes
16.3 CONTENTS
16.3.1 Need for Management Development
16.3.2 Concept of Management Development
16.3.3 Management Development Objectives
16.3.4 Essentials of Management Development Programmes
16.3.1 Need for Management Development
In todays time, the survival of a business is not the only requirement. It has to
grow, keeping pace with the global economy. Survival of the fittest was the law of
jungles. At present, in the industrial scenario characterized by acute competition,
survival of the fastest is the prevailing law. Organizations that are fast and
consistent are likely to survive and grow.
Management development is necessary for the following reasons:
1. Rapid changes are taking place in the technological and industrial scenario.
Managers are facing multifaceted problems arising out of automation,
intense market competition, growth of new markets, rising customer
consciousness, enhanced labour participation, and the like.
2. Organizational leaders are increasingly recognizing the companys social and
public responsibility essential to be close to the society and customers.
3. Size and complexity of the organizations are ever increasing; a huge number
of people are required to be m anaged, and the complexities have to analyse
for solution.
4. Multicultural issues are emerging as vital considerations and the issues are
crucial for multinationals.
5. Union-management relations are becoming more and more intricate, thus
necessitating precise industrial relations.
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6. The socio-economic forces, effective market force, changes in public policy
and concepts of social, industrial democracy, ecological imbalances (smog or
pollution), ekistics (problem of human settlements) and, ergonomics (human
engineering), are changing.
16.3.2 Concept of Management Development
The important assumptions and concerns behind management development
are as follows:
1. An executive needs development throughout his work life and his
professional career. Thus, management deve lopment is an on-going activity.
2. There always exists a gap between required performance level and the
capacity of an individual. Management must fill in the gap to provide an
opportunity for improvement.
3. Some personal variables (such as age, habits, l evel of motivation, state of
mind, etc.) retard the growth of an individual.
4. In work situation, growth involves stresses and strains. Development can
seldom take place in a completely peaceful atmosphere.
5. Involvement and participation are inescapable for growth.
6. In addition to the methodology of achievement, there must be defined
objectives and goals required to be achieved.
7. Shortcomings must be identified. Feedback and counseling to junior
colleagues mentioning the shortcomings and applying suitable HRD
instruments to overcome the shortcoming are essentially required.
16.3.3 Management Development Objectives
Management development programmes must aim to achieve the following
objectives:
To provide the organization with the required numbers of managers having
the ability to meet the present and future organizational needs
To inculcate a sense of self-dependency and achievement among managers
To encourage the managers to keep themselves up to date, and grow to meet
the challenges, cope up with the changes, and handle complex situations
and greater problems
To discharge their responsibilities with improved performance
To sustain good performance and gain distinctive competence.
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16.3.4 Essentials of Management Development Programmes
The important steps in management development programs
1. Analysis of Organizational Present and development Needs

The decision to launch a management development programs having been
made, the next thing to do is the close and critical examination of organizational
present and future developmental needs. We should know how many and what type
of managers are required to meet the present and future needs. An examination of
the organizational structure in the light of the future plans of the organization
should help one know what the organization requires in terms of functions,
departments and executive positions. Having got the above the information it is
easy to prepare the descriptions and specifications for all management positions
which in turn, gives us the information as to the kind of education, experience,
training, special knowledge, skills and personal traits required for each job. A
comparison of the existing talents plus those that can be developed from within
those required to meet the projected needs will help the top management make a
policy decision as to whether it wishes to fill those positions from within the
organization or from outside sources.
2. Appraisal of Present Management Talent
In order to make the above suggested comparison, a qualitative assessment of
the existing management talent should be made and an estimate of their potential
for development should be added to that. Only then can it be compared with the
projected required talent.
3. Inventory of Management Manpower
This is prepared to have complete information about each executive in each
position. For each member of the management team, a card is prepared listing such
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data as name, age, length of service, education, work experience, training courses
completed, health record, psychological test results and performance appraisal data
etc. The selection of the individuals for the management development programs is
made on the basis of the kind of background they possess. The management may
set certain standards in terms of each of the above factors mentioned on the cards
to qualify for the management development programs. Such information when
analysed discloses the strengths as well as the deficiencies of managers in certain
functions relative to the future needs of the organization.
4. Planning of Individual development Program
Guided by the results of the performance appraisal which indicate the
strengths and weaknesses of each of his subordinates the executive performs this
activity of planning of individual development programs. Each of us has un ique set
of physical, intellectual, emotional characteristics. Therefore, a development plan
should be tailor-made for each individual.
It would be possible to impart knowledge, skills and mould behavior of human
beings, but it would be difficult to change the basic personality and temperament of
a person once he reaches adulthood stage.
5. Establishment of Development Program
It is the duty of the HR department to establish the well-conceived
development opportunities.
The HR department has to identify the existing level of skills, knowledge etc, of
various executives and compares them with their respective job requirements.
Thus, it identifies developmental needs and will establish specific development
programs like leadership courses, Management games, an d Sensitivity training. The
department may not be in a position to organize development programs for
executives at the top level as could be organized by reputed institutes of
management. In such situations, top management deputes certain individuals to
the executive development programs organized by the reputed institutes.
6. Evaluation of Programme
Considerable money, time and efforts are spent on executive development
programmes. It is, therefore, natural to find out to what extent the programme
objectives have been achieved. Programme evaluation will reveal the relevance of
the development programmes and the changes that should be made to make these
more useful to the organization. Observation of the trainees behavior, rating of
the training elements, opinion surveys, interviews, tests and changes in
productivity, quality, cost, etc., can be used to evaluate development programmes.
General results of development programmes can be measured in the long run. But
some specific results may be assessed during the short-term.
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Methods of Management Development Programme:

1. MDP is the process adopted to supply knowledge, skills, attitudes, and
insights to managerial personnel, and help them manage their work
effectively and efficiently.
2. Inventory of management manpowerr is prepared to have complete
information about each executive in each position.
3. The HR department has to identify the existing level of skills, knowledge etc,
of various executives and compares them with their respective job
requirements.
Self-Evaluation Questions
1. What are the needs of management development programme?
2. Discuss the concept of management development programme.
3. What are the objectives of development programme?
16.6 SUMMARY
Management Development Programme is the process of improving the
performance and potential of managers. It is largely self-development.
Management development is essential because executives are most valuable asset
of any organization. Analyzing developing needs, appraising current talent,
preparing executive inventory, planning development programme, establishing the
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programme, evaluating success are the main steps in the process of management
development. Several on the job and off the job methods are u sed for developing
executives. An executives development programme can be made successful by
following specified principles.
1. The quality of leadership determines the quality of
a. the industry
b. manager
c. the organization
d. IT system
2. Which of the following is not considered in the process of analysis?
a. Competency mapping
b. identification of competency gaps
c. organizational strategy
d. career planning
3. On-the-job training does not include
a. Job rotation
b. coaching
c. job enlargement
d. action learning
4. Role plays and management games are techniques used in
a. On the job training
b. Off the job training
c. Induction programmes
d. Orientation
5. Success of any organization is linked to
a. The quality of HR
b. Organizational development efforts
c. Education and executive development
d. All of these
1. Wayne F. Cascio and Herman Aguinis, Applied Psychology in Human
Resource Management, Sixth Edition, New Delhi: PHI Learning Limited,
2009 Edition
2. Sangeetha Jain, Quality of work life (QWL), New Delhi: Deep and Deep
Publications, 1991 Edition
154
16.9 ASSIGNMENTS
1. Give explanation about important steps followed in management
development programme.
2. Converse the various methods of management development programme.
1. Abraham, Enthemkuzhy (1989). A study of human resources development
practices in Indian organizations, Unpublished Doctoral Dissertation,
Ahmedabad: Gujarat University.
2. Agarwal, R.K. (1986). Human Resources Development in State Bank of
Patiala, In Recent Experiences in Human Resources Development.
3. Agarwala, Tanuja, strategic Human Resource Management, Ozford
University press, New Delhi, 2007.
4. Aggrawala, Dharma V. (1999). Manpower planning, selection, trai ning and
development (Chapter 15), Training and Development, New Delhi: Deep and
Deep publications.
5. Aswathappa, K. (2008). Human Resources Management, Tata McGraw-Hill
Publishing Co. Ltd.
6. Beardwell, I., Holden, L. and Clayton, T. (2004). Human Resource
Management a Contemporary Approach (4th edn), London: FT Prentice
Hall. Beer, S., Mills, D.Q. and Walton, R.E. (1985).
7. Bee, Frances and Roland Bee, Training Needs Analysis and Evaluation,
University Press (India) Limited, New Delhi, 1998.
8. Bharwaj, Rupali and Khandelwal, P. (Jan-March 1993). HRD: A key to
organizational Effectiveness. IJTD, Vol. 23 (6). Bhatia, S.K. (2005).
9. Human Resource Management John H.Bernardian and Joyce E.A. Russel
An Experimental Approach, McGraw Hill, New York.
10. Human Resource Management V.S.P.Rao, Excel Books, New Delhi.
11. Human Resources and Personnel Management K. Aswathappa, Tata
McGraw Hill Publishnig Co. Ltd.
12. Kozoll, Charles F., Characteristics of a Trainer, Harvard University, USA, in
Training and Development Journal, Vol. 29,No.7,July 1975.
13. Managing the two fits of strategic human resource management. Academy of
Management Review, 13.
14. Pereira, D.F. (1986). Human Resources Development in Larsen and Toubro,
Recent Experiences in Human Resources Development.
15. Saraswathi, S. (June 2010). Human Resources Development Climate: An
Empirical Study, International Journal of Innovation, Management and
Technology, Vol. 1, No. 2.
155
16. Sinha, Dharni P. (1991). Human Resource Development: The Indian
Challenge, In Management of Change through Human Resource
Development, B.L. Maheshwari and D.P. Sinha (eds.), New Delhi: Tata
McGraw Hill Publishing Company.
17. Sundaram, Sudershan, (1986). Human Resources Development activities at
T.V. Sunderam Iyengar and Sons Ltd., Madurai, In Recent experiences in
Human Resources Development.
1. Visit to a Bank located in your area and find out what kind of development
programme conducted for the officers of banks and enquire about the
positives and negative impact on executive development programme.
16.12 KEYWORDS
Management Development Programme (MDP), Executive Development
Programme (EDP), Organizational Development, Employee career development,
Strategic Human Resource Development.

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UNIT V : TRANSFER, PROMOTION, DISCIPLINE AND COMPENSATION
LESSON 17
TRANSFER AND PROMOTION
17.1 INTRODUCTION
A transfer is a horizontal or lateral movement of an employee from one job,
section, department, shift, plant or position to another at the same or another place
where his salary, status and responsibility are the same. Yoder and others (1958)
define transfer as a lateral shift causing movement of individuals from one position
to another usually without involving marked change in duties, responsibi lities,
skills needed or compensation. Transfer may be initiated either by the company or
the employee. It also can be temporary or permanent. Transfers is generally affected
to build up a more satisfactory work team and to achieve the following purposes:
To increase the effectiveness of the organization.
To increase versatility and competence of key

positions.
To deal with fluctuations in work requirements.
To correct incompatibilities in employee relations.
To correct erroneous placement.
To adjust workforce.
To punish employees.
17.2 OBJECTIVES
Meaning of Transfer
Objectives of transfer
Transfer Policy of the companies
Different types of Transfer
Promotion and its Purpose
Promotion Policy and Types of Promotion
Demotion and its implications
17.3 CONTENTS
17.3.1 Reasons for Employee Transfers
17.3.2 Types of Transfers
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17.3.3 Promotion
17.3.4 Purpose and Advantages of Promotion
17.3.5 Promotion Policy
17.3.6 Types of Promotion
17.3.7 Demotion
17.3.1 Reasons for Employee Transfers
1. To avoid gaining capacity of influencing and egocentrism.
2. To avoid monotony in the work of an employee.
3. So as to avoid excess dependency on particular employee.
4. To create transparency among the employees and their work.
5. It limits taking advantage and sole control over the seat or section.
6. To avoid unnecessary influence on others for their own advantage.
7. To make conversant of different seats work.
8. To maintain healthy relationship in between all the staff members to retain
harmonious environment to avoid unnecessary disputes
Transfer Policy
Every organization should have a fair and impartial transfer policy which
should be known to each employee. The responsibility for effecting transfers is
generally entrusted to an executive with power to prescribe the conditions under
which requests for transferred are approved. Care should be taken to ensure that
frequent or large scale transfers are avoided by laying down adequate selection and
placement procedures for the purpose. A good transfer policy should:
Specifically clarify the types of transfers and the conditions under which
these will be made.
Locate the authority in some officer who may initiate and implement
transfers.
Indicate whether transfers, i.e., whether it will be based on seniority or on
the skill and competency or any other factor.
Decide the rate of pay to be given to the transferee.
Intimate the fact of the transfer to the person concerned well in advance.
Be in writing and duly communicated to all concerned.
Not be made frequently and for sake of transfer only.
17.3.2 Types of Transfers
Employee transfers may be classified as below.
1. Production transfers: When the transfers are being made for filling the
position in such departments having lack of staff, from the departments
having surplus manpower it is called production transfer. It prevents the
layoffs form the organization. Also it is good to adjust existing staff rather than
to hire the new one.
158
2. Replacement transfers: This takes place to replace a new employee who has
been in the organization for a long time and thereby giving some relief to an
old employee from the heavy pressure of work.
3. Versality transfers: It is also known as rotation. This is done by transferring
employee to different jobs closely related in same department or process line..
This is used as a training device. It helps employee to develop him and he is
equipped for the high responsibility jobs as he is having knowledge of the
whole process. It also helps to reduce boredom and monotony
4. Personnel or remedial transfers: Such a transfer is made to rectify mistakes
in selection and placement. As a follow up, the wrongly placed employee is
transferred to a more suitable job.
5. Shift transfers: This is pretty common where there is more than one shift and
when there is regularised rotation. In many multi-shifts jobs such as Call
centers employees are transferred from one shift to another due to their
personal reasons like health problem or evening college for higher studies or
any family problems.
17.3.3 Promotion
Promotion is vertical movement of an employee within the organisation. In
other words, promotion refers to the upward movement of an employee from one job
to another higher one, with increase in salary, status and responsibilities.
Promotion may be temporary or permanent, depending upon the needs of the
organisation.
According to Pigours and Myers, Promotion is advancement of an employee to
a better job better in terms of greater responsibility, more prestige or status,
greater skill and especially increased rate of pay or salary.
Arun Monappa and Mirza S Saiyadain defined promotion as the upward
reassignment of an individual in an organizations hierarchy, accompanied by
increased responsibilities, enhanced status and usually with increased income
though not always so
Promotion has an in-built motivational value as it elevates the authority,
power and status of an employee within an organisation. It is considered good
personnel policy to fill vacancies in a higher job through promotions from within
because such promotions provide an inducement and motivation to the employees
and also remove feelings of stagnation -and frustration.
17.3.4 Purpose and Advantages of Promotion
Promotion stimulates self-development and creates interest in the job.
According to Yoder, promotion provides incentive to initiative, enterpri se and
ambition; minimizes discontent and unrest; attracts capable individuals;
necessitates logical training for advancement and forms an effective reward for
loyalty and cooperation, long service etc. The purposes and advantages of
promotions are to:
Recognize employees performance and commitment and motivate him
towards better performance;
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Develop competitive spirit among employees for acquiring knowledge and
skills for higher level jobs;
Retain skilled and talented employees;
Reduce discontent and unrest;
To fill up job's vacant position that is created due to retirement, resignation
or demise of an employee. In this case next senior employee will be promoted
to the vacant job.
Utilize more effectively the knowledge and skills of employees; and
Attract suitable and competent employees.
17.3.5 Promotion Policy
We have seen policy is the guideline for action. Policy varies with organization.
So the promotion is very sensitive to employees, it is very essential. The promotion
policy should clearly stated, widely circulated, and fully explained to their
employees. The promotion policy which influences the number of factor of the
organization such as, morale, motivation, turnover of the personnel in the
organization. The personnel department of the organization must develop an
effective promotion policy. This should be in written, flexible subject to situations.
In order to make the promotion policy successful, it is necessary that the
employees assessment and confidential reporting system should be objective as far
as possible so that every employee has faith in promotion policy and hence induced
for better performance to get promotion. The promotion policy should consider
merit, potential and seniority of the employees. The merit factor requires a go od
procedure for evaluating the performance of the employee. The performance of the
each employee should be appraised periodically and should form the part of
personal record.
The following characteristics make a promotion policy as sound and good policy:
1. It must provide equal opportunities for promotion across the jobs,
departments, and regions.
2. It must be applied uniformly to all employees irrespective of their
background.
3. It must be fair and impartial.
4. The basis of promotion must be clearly specified an d made known to the
employees.
5. It must be correlated with career planning. Both quick (bunching) and
delayed promotions must be avoided as these ultimately adversely affect the
organisational effectiveness.
6. Appropriate authority must be entrusted with the task of making final
decision.
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7. Promotion must be made on trial basis. The progress of the employee must
be monitored. In case, the promoted employee does not make the required
progress, provision must be there in the promotion policy to revert him/her
to the former post.
8. The policy must be good blending of promotions made from both inside and
outside the organisation.
17.3.6 Types of Promotion
1. Horizontal promotion
When an employee is shifted in the same category, it is called horizontal
promotion. A junior clerk promoted to senior clerk is such an example. It is
important to note that such promotion may take place when an employee shifts
within the same department, from one department to other or from one plant to
another plant.
2. Vertical Promotion
This is the kind of promotion when an employee is promoted from a lower
category to lower category involving increase in salary, status, authority and
responsibility. Generally, promotion means vertical promotion.
3. Dry Promotion
When promotion is made without increase in salary, it is called dry
promotion. For example, a lower level manager is promoted to senior level manager
without increase in salary or pay. Such promotion is made either there is
resource/fund crunch in the organisation or some empl oyees hanker more for
status or authority than money.
Promotion can be made on various bases. Following are the major ones
Seniority i.e., length of service
Merit, i .e., performance
Educational and technical qualification
Potential for better performance
Career and succession plan
Vacancies based on organizational chart
Motivational strategies like job enlargement.
Training
As a matter of fact, no single basis of promotion is acceptable and applicable to
all organisations. Every basis has its strengths and weaknesses. For example, while
promotion on the basis of seniority gives satisfaction to the senior employees, it
causes frustration to the talented ones. Similarly, promotion based on merit
motivates competent employees to work hard while trade unions oppose it on the
justification of its subjectivity. In India, promotion in the government departments
is made on the basis of seniority of the employees. In case of private organisations,
161
merit is generally used as a basis for promoting employees. Here, the promotion
policy is to promote the best one available.
17.3.7 Demotion
Demotion is the opposite of promotion. It is a downward movement of
employees in the organizational hierarchy with lower status and lower salary. It is
the down-warding process and is insulating to an employee. Demotion is the
punishment for incompetence or mistake of serious nature on the part of the
employee. It is serious types of the penalty or punishment and should be given
rarely and only under exceptional circumstances and tactfully. Demotions may be
necessary under the following conditions:
When the organization reduces activities, officer occupying certain posts are
demoted.
Errors in the promotions already made are corrected through demotions.
It may be necessary to use demotions as a tool of disciplinary action against
erring employees.
The tool of demotion should be used only when it is absolutely necessary.
However, there should not be any injustice to any of employees in this regard.
Demotions should be made for genuine reasons. Promotions are easily as they
affect their status, career and position. Demotion usually treated as an insult and
naturally resented by the employees in one way or the other. It is, therefore,
desirable to avoid demotions as far as possible. Demotions should be an exception
but not the normal rule of the organization.
Demotion is very harmful for the employees morale. It is an extremely painful
action, impairing the relationships between people permanently. While effecting the
demotions, managers should extremely careful not to place himself on the wrong
side of the fence. It is therefore, very necessary to formulate a demotion policy so
that there may be no grievances on the part of the unions and the employee
concerned. Demotions should have serious i mpact on need fulfilment. Needs for
esteem and belongingness are get frustrate leading to a defensive behaviour on the
part of the person demoted. There may be complaints, emotional turmoil,
inefficiency or resignations. Hence, demotions are very rarely re sorted to by
managers. Manager prefers to discharge the employees rather than face the
problems arising from the demotions.
1. Production transfers
When the transfers are being made for filling the position in such
departments having lack of staff, from the departments having surplus
manpower it is called production transfer.
2. Promotion
Promotion refers to the upward movement of an employee from one job to
another higher one, with increase in salary, status and responsibilities.
162
3. Demotion
Demotion is the opposite of promotion. It is a downward movement of
employees in the organizational hierarchy with lower status and lower
salary.
1. What do you understand by transfer? Describe various types of transfers.
2. What are the causes and objectives of transfers?
3. Describe the essentials of good transfer policy.
4. What is promotion? Explain the basic characteristics of a sound promotion
policy.
5. What are the types of promotion?
6. What is demotion and why is it needed? Explain the requi rements of a
proper demotion policy.
17.6 SUMMARY
Job changes refer to internal and external mobility of employees. The changes
are made to maximizing efficiency and effectiveness to ensure among the
employees. Transfers of employees are made to satisfy n eeds of both employer and
employees. Production, replacement, versatility, remedial and shift are the types of
transfer. Promotion of employees helps to improve motivation, morale, efficiency
etc., of employees. Seniority and merit are the two main basis for promotion. Every
company should have proper policies relating to transfer and promotion. Demotion
is the reverse of promotion.
1. Why is it necessary to change an employees job? Explain the purpose of job
changes?
2. What do you understand by transfer? Describe various types of transfers
3. Explain the causes and objectives of transfers
4. Define promotion. How does it differ from upgradation and transfer?
5. What is promotion? Explain the basic characteristics of a sound promotion
policy
6. Briefly explain the ways by which employees separate themselves from the
enterprise they are serving.
1. Stephen P. Robbins and Timothy A. Judge, Organisational Behaviour,
New Delhi: Prentice Hall of India, 12, 2007 Edition .
2. N.G. Nair and Lalitha Nair, Personnel Management and Industrial
Relations, New Delhi: S. Chand and Company Ltd., 2001 Edition .
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17.9 ASSIGNMENTS
1. New employees are introduced to the organisations standards, goals, values,
and culture through
a. Promotion
b. Global placement
c. Induction
d. Internal mobility
2. The practice of assigning a candidate to the right job is called
a. Interview
b. Promotion
c. Placement
d. Retrenchment
3. What is meant by the term retrenchment?
a. A process of giving employees greater autonomy and decision making
power
b. A system that encourages workers to move more freely within the
organization
c. Permanent lay-off of surplus staff due to economic slowdown
d. A formal system of leadership that relies greatly on control
1. Gilmer, B.V.H., 1966, Industrial Psychology, McGraw Hill Book Company,
New York.
2. Glicken, M.D., 1977, A regional study of the job satisfaction of social
workers, Dissertation Abstracts International, 38,3,1658-A.
3. Goble, J.W., 1977, Relationships between job satisfaction,
demographic factors, absenteeism and tenure of workers in a Delmarva
broiler processing plant, Dissertation abstracts International, 38, 4, 1820-A.
4. Hayeslip, D.W., 1977, Pupil control ideology pupil control behaviour
congruence and the job satisfaction of public school teachers, Dissertation
Abstracts International, 37, 11, 6871- A.
5. Lahiri, D.K., and Srivastava, S., 1967, Determinants of satisfaction in
middle-management personnel, Journal of Applied Psychology, 51, 3, 254-
265.
6. Markham. L.G. and Van Zyl E.S. (2008), The Effect of Biographical
Variables on the Job Satisfaction of A Group Human Resource Management
Employees working in a Municipality, Journal for New Generation Sciences:
Vol.10, No.1, pp. 80-96.
164
1. Take into consideration of an organization, its organizational structure and
try to understand the different levels of management, position of the
employees. Analyze how their career growth, promotion and transfers are
fixed up based on their experience, educational qualification and with other
criteria. Study the procedures of promotion and transfer by seeing the
companies human resource polices.
17.12 KEYWORDS
Promotion, Transfer, career advancement, career development, de -promotion,
motivation, monetary and non-monetary motivations.

165
LESSON 18
DISCIPLINE
18.1 INTRODUCTION
Discipline is the regulation and modulation of human activities to produce a
controlled performance. The real purpose of discipline is quite simple. It is to
encourage employees to confirm to established standards of job performance and to
behave sensibly and safely at work. Discipline is essential to all organized group
action. Discipline is employee learning that promotes self-control, dedication, and
orderly conduct. In relation to employees in the U.S., discipline is generally used in
a restricted sense to mean punishment. Consequently, the written procedures used
to punish employees for job deficiencies are called disciplinary procedures.
Punishment is the process of either administering an unpleasant stimulus, such as
a warning letter or a suspension, or withholding a reward, such as not granting a
scheduled pay increase because of an employee's job deficiencies. Punishment is
only one form of discipline; other forms are positive reinforcement, including
commendations and praise, and human resources development.
18.2 OBJECTIVES
Discipline
Positive and Negative Aspects of Discipline
Causes of Indiscipline
Disciplinary Procedures
Maintaining Discipline
18.3 CONTENTS
18.3.1 Definition of Discipline
18.3.2 Nature of Indiscipline
18.3.3 Causes of Indiscipline
18.3.4 Disciplinary Procedure
18.3.1 Definition of Discipline
According to Richard D. Calhoon, Discipline is the force that prompts
individuals or groups to observe rules, regulations, standards and procedures
deemed necessary for an organization. Therefore discipline means securing
consistent behaviour in accordance with the accepted norms of behaviour. I am
sure you will agree that discipline is essential in every aspect of life. It is equally
essential in industrial undertakings. Simply stated, discipline means orderliness. It
implies the absence of chaos, irregularity and confusion in the behaviour of
workers.
Discipline is a procedure that corrects or punishes a subordinate because a
rule of procedure has been violated. Dessler, 2001. Discipline should be viewed as
a condition within an organisation whereby Employees know what is expe cted of
166
them in terms of the organisations rules, Standards and policies and what the
consequences are of infractions. Rue &Byars, 1996
From the above definitions, you can find the following elements:
The objective is orderly behaviour.
Orderly behaviour is a group desire.
Orderly behaviour assists the attainment of organisational goals
When members behave appropriately as per rules, there is no need for
disciplinary action. This is self-discipline.
When some members violate the rules and regulations, puni tive actions are
needed to correct them.
Punishment serves two purposes: first, to directly punish an individual for
an offence and secondly, to set an example for others not to violate the rules
and regulations.
Those employees who observe the rules and standards are rewarded by praise,
by security and often by advancement. Those who cannot stay in line or measure
up to performance standards are penalized in such a way that they can clearly
learn what acceptable performance and behaviour are. Most employee s recognize
this system as a legitimate way to preserve order and safety and to keep everyone
working towards the same organisational goals and standards. For most employees,
self- discipline is the best discipline. As often as not, the need to impose penalties is
a fault of the management as well as of the individual worker. For that reason
alone, a supervisor should resort to disciplinary action only after all else fails.
Discipline should never be used as a show of authority or power on the su pervisors
part.
18.3.2 Nature of Indiscipline
Maintenance of discipline is a prerequisite to the attainment of maximum
productivity, not only of the firm but also for the entire nation. It is only because of
this that. After all everything is a matter of realization! No amount of pressure can
succeed in the long run unless one is committed to improve or learn. True
discipline is educational because it changes the very attitude of the workers
towards their work and workplace. It must, therefore, be understood that discipline
must be developed from within. Another important point that you should note here
is that discipline has to be reformative and not punitive. We should aim at
development rather than punishing. I am sure that you will adhere to something
that is explained to you in a calm and matured way rather than that is ordered!
According to Megginson, discipline involves the following three things.
Self-discipline implies that a person brings the discipline in himself with a
determination to achieve the goals that he has set for himself in life.
Orderly behaviour refers to discipline as a condition that must exist for an
orderly behaviour in the organization.
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Punishment is used to prevent indiscipline. When a worker goes astray in
his conduct, he has to be punished for the same and the recurrences of it
must be prevented.
Discipline can either be positive or negative
1. Positive Discipline
Positive discipline involves creation of an atmosphere in the organisation
whereby employees willingly conform to the established rules and regulations.
Positive discipline can be achieved through rewards and effective leadership.
According to Spiegel, Positive discipline does not replace reason but applies
reason to the achievement of a common objective. Positive Discipline does not
restrict the individual freedom but enables him to have a greater degree of self-
expression in striving to achieve the group objective, which he identifies as his
own. It means that positive Discipline is not that ideal that it cant be achieved. It
also does not imply that an individuals freedom is restricted. Rather it provides
better chances to an individual for expressing himself. The individual in this
process, is able to bridge the gap between his and the group goals. It is also to be
noted that positive discipline promotes cooperating and coordination with a
minimum of formal organization. It reduces the need for strict supervision required
to maintain standards and observe rules and regulations. Everyone is answerable
to oneself and therefore one is not answerable to anyone else.
2. Negative Discipline
Under negative discipline, penalties are used to force the workers to obey rules
and regulations. In other words, workers try to adhere to rules and regulations out
of fear of warnings, penalties and other forms of punishment. This approach to
discipline is called negative or punitive approach.
This is an unfavourable state that subjects the employees to frustration, and
consequently results in low morale. Let me ask you a question, how will you react if
you are punished for a wrong act of yours? Will you welcome it? I am sure it would
be much better that an environment is created where one does not commit any
wrongful act. If at all there is some indiscipline, tit has to be handled in a calm and
matured way. There is another drawback related to negative discipline. An
employee goes astray in his behaviour whenever there is a slightest possibility of
escaping the punishment or when he believes that his action will go unnoticed.
Progressive and development oriented managers adopt a positive approach to
discipline rather than negative approach. In the positive approach, attempts are
made to educate the workers the values of discipline. The workers should be taught
self-discipline. Disciplinary action should be taken only in exceptional
circumstances where no other alternative is left. Disciplinary action should always
incorporate consideration of just cause and due process.
Some of the symptoms of general indiscipline can be
Absenteeism
Abusing customers
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Abusive language toward supervisor
Assault and fighting among employees
Causing unsafe working conditions
Damage to or loss of machinery or materials Dishonesty
Disloyalty to employer (includes competing with employer, conflict of
interest)
Falsifying company records (including time records, production records)
Incompetence (including low productivity)
Leaving place of work (including quitting early)
Misconduct during a strike
Negligence
Participation in a prohibited strike
Refusal to accept a job assignment
Refusal to work overtime
Sleeping on the job
Slowdown
Theft Threat to or assault of management representative
18.3.3 Causes of Indiscipline
Various socio-economic and cultural factors play a role in creating indiscipline
in an organization. We wonder if you realise the fact that often indiscipline may
arise because of poor management on your part. Insensitive and thoughtless words
and deeds from a manager are potent reasons for subordinates to resort to acts of
indiscipline. Defective communication by the su periors and ineffective leadership.
The reasons could range anything from poor wages to, poor management and the
communication gaps between the union and management.
The common causes of indiscipline are as follows,
1. Unfair Management Practices: Management sometimes indulges in unfair
practices like:
Wage discrimination
Non-compliance with promotional policies and transfer policies
Discrimination in allotment of work
Defective handling of grievances
Payment of low wages
Delay in payment of wages
Creating low quality work life etc. These unfair management practices
gradually result in indiscipline.
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2. Absence of Effective Leadership: Absence of effective leadership results in
poor management in the areas of direction, guidance, instructions etc. This in turn,
results in indiscipline.
3. Communication Barriers: Communication barriers and absence of
humane approach on the part of superiors result in frustration and indiscipline
among the workers. The management should clearly formulate the policies
regarding discipline. These policies should be communicated and the policies
should be consistently followed in the organizations. The management should also
be empathetic towards the employees.
4. Varying Disciplinary Measures: Consistent disciplinary actions must be
there in the organization to provide equal justice to all concerned. At different times
and for everyone, the same standard of disciplinary measures should be taken
otherwise it may give rise to growing indiscipline in the industry in future.
5. Defective Supervision: Supervisor is the immediate boss of the workers
and many disciplinary problems have their in faulty supervision. The attitude and
behaviour of the supervisor may create many problems.
6. Inadequate attention to personnel Problems: Delay in solving personnel
problems develops frustration among individual workers. The management should
be proactive so that there is no discontent among the workers. It should adopt a
parental attitude towards its employees.
7. Victimization: Victimization of su bordinate also results in indiscipline. The
management should not exploit the workers. It is also in the long -term interest of
the management to take care of its internal customers.
8. Absence of Code of Conduct: This creates confusion and also provides
chance for discrimination while taking disciplinary action. We will be discussing
Code of Discipline in details etc. A code of conduct is a set of rules outlining the
responsibilities of or proper practices for an individual, party or organization.
Related concepts include ethical codes and honour codes.
9. Divide and Rule Policy: Many mangers in the business obtain secret
information about other employees through their trusted assistants. The spying on
employees is only productive of a vicious atmosphere and of undesirable in the
organization. Henry Fayol has rightly pointed out that dividing enemy forces to
weaken them is clever, but dividing one's own team is grave sin against the
business. No amount of management skill is necessary for dividing personnel, but
integrating personnel into a team is the chall enging task of sound management.
10. Deferring settlement of Employee Grievances: The employee grievances
cannot be put off by deferring or neglecting their solutions. The grievances should
properly be inquired into and settled by the managers in a reasonable period.
Neglect of grievances often results in reduced performance, low morale and
indiscipline among the employees.
11. Mis-judgment in Promotion and Placements: Mis-judgment in personnel
matters like promotion and placements contribute to the growth of indiscipline in
an enterprise.
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Purpose and Objectives of disciplinary action
The purpose of discipline is to encourage employees to behave sensibly at
work, where being sensible is defined as adhering to rule and regulations. In an
organisation, rules and regulations serve about the same purpose that laws do in
society; discipline is called for when one of these rules or regulations is violated.
Following are some of the purposes and objectives of disciplinary action:
To enforce rules and regulations.
To punish the offender.
To serve as an example to others to strictly follow rules.
To ensure the smooth running of the organisation.
To increase working efficiency.
To maintain industrial peace.
To improve working relations and tolerance.
To develop a working culture which improves performance.
18.3.4 Disciplinary Procedure
Disciplinary procedures are a critical tool for management to succeed. Many
people associate disciplinary procedures with negative feedback. If implemented
properly, these procedures will positively affect the relationship between a manager
and their employees. Employees embrace accountability and it actually improves
employee job satisfaction. Correcting employee performance issues is a procedure.
Effective interpersonal communication, written communication, and your
management skills list must be utilized to assist your employees. Poorly
implemented procedures may negatively impact workplace performance.
Before starting the process of discipline, it is essential to hol d a preliminary
inquiry to know if a prima facie case of indiscipline and misconduct exist. After
this, the following steps should be followed:
1. Issue of charge sheet: Once the prima facie case of misconduct is
established, the management should proceed to issue a charge sheet to the
employee. Charge sheet is merely a notice of the charge and provides the
employee an opportunity to explain his conduct. Therefore, charge sheet is
generally known as a show cause notice. In the charge sheet, each charge
should be clearly specified. There should be a separate charge for each
allegation and charge should not relate to any matter, which has already
been decided upon. I would suggest each one of you to talk to find out how
is a charge sheet prepared. We will discuss that in the next class.
2. Consideration of Explanation. On getting the answer for the charge sheet
served, the explanation furnished should be considered and if it is
satisfactory, no disciplinary action needs to be taken. On the contrary when
the management is not satisfied with the employees explanation, it can
proceed with full-fledged enquiry. (However, if the worker admits the charge,
the employer can warn him or award him punishment without further
enquiry.
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3. Suspension pending Enquiry. In case the charge is grave that is serious, a
suspension order may be served on the employee along with the charge
sheet. According to the Industrial Employment (Standing Order) Act, 1946,
the suspended worker is to be paid a subsistence allowance equal to one-
half of his wages for the first ninety days of suspension and three-fourths of
wages for the remaining period of suspension if the delay in the completion
of disciplinary proceedings is not due to the workers conduct. What is grave
will depend on the discretion of the management. It has to be decided in
accordance with the Code of Discipline.
4. Holding of Enquiry. An enquiry officer should be appointed to hold the
enquiry and a notice to this effect should be given to the concerned worker.
Principle of natural justice must be followed. The worker should not be
denied the chance of explaining himself. The enquiry officer should give
sufficient notice to the worker so that he may prepare to represent his case
and make submission in his defence. The enquiry officer should proceed in a
proper manner and examine witnesses. Fai r opportunity should be given to
the worker to cross-examine the management witnesses.
5. Principle of Natural Justice: The principles of natural justice can be
summarized as follows:
Tell the person what he has done
Hear Him
Give Him a Chance to defend himself
On the conclusion of the enquiry, the enquiry officer should record his findings
and the reasons thereof. He should refrain from recommending punishment and
leave it to the decision of the appropriate authority. After all he is just an enquiry
officer!!
1. Order of Punishment. Disciplinary action can be taken when the
misconduct of the employee is proved. While deciding the nature of disciplinary
action, the employees previous record, precedents, effects of the action on other
employees, etc., have to be considered. When the employee feels that the enquiry
conducted was not proper and the action taken unjustified, he must be given a
chance to make appeal.
1. Discipline: The force that prompts individuals or groups to observe rules,
regulations, standards and procedures deemed necessary for an
organization.
2. Self-discipline: Implies that a person brings the discipline in himself with a
determination to achieve the goals that he has set for himself in life.
3. Orderly behaviour: Refers to discipline as a condition that must exist for an
orderly behaviour in the organization.
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1. What are the causes of indiscipline?
2. Discipline is of two types positive and negative.
3. What are the purpose and objectives of disciplinary action ?
18.6 SUMMARY
Discipline implies adherence to the rules and regulation of the organization.
There are two types of discipline are positive and negative discipline. Indiscipline is
caused by faulty leadership, biased management practices, political and trade
union factors etc., Disciplinary action should be based on principles of natural
justice. Preliminary investigation, issue of charge sheet, suspension, notice of
enquiry, findings, punishment, and communication are the steps in disciplinary
process.
1. Explain the procedure for taking disciplinary action.
2. Disciplinary action should be based on principles of natural justice.
1. Meredith J.R., The Management of operations, New York: John Wiley &
3. Wayne F. Cascio and Herman Aguinis, Applied Psychology In Human
2009, Edition.
18.9 ASSIGNMENTS
1. Read the policies and procedures of disciplinary action taken by the
Corporate against the employees on various grounds and highlights the
mechanism to sort out that kind of incidents as the assignments
1. Atwater, L., Carey, J., & Waldman. D, (2001). Gender and discipline in the
workplace: Wait until your father gets home. Journal of Management, 27,
537-561.
2. Atwater, L., Waldman, D., Carey, J., & Cartier, P. (2001). Subordinate and
observer reactions to discipline: Are managers experiencing wishful
thinking? Journal of Organizational Behavior, 22, 249-270.
3. Baird, J. E., & Bradley, P. H. (1979). Styles of management and
communication: A comparative study of men and women. Communication
Monographs, 46, 101-111.
4. Butterfield, K., Trevino, L., & Ball, G. (1996). Punishment from the
managers perspective: A grounded investigation and inductive model.
Academy of Management Journal, 39, 1479-1512.
173
5. Carli, L. (1995). Nonverbal behavior, gender, and influence. Journal of
Personality and Social Psychology, 68, 1030-1041.
6. Dobbins, G., Cardy, R., & Truxillo, D. (1988). The effects of purpose of
appraisal and individual differences in stereotypes of women on sex
differences in performance ratings: A laboratory and field study. Journal of
Applied Psychology, 73, 551-558.
7. Falbo, T., & Peplau, L. A. (1980). Power strategies in intimate relationships.
Journal of Personality and Social Psychology, 38, 618-628.
8. Feingold, A. (1994). Gender differences in personality: A meta-analysis.
Psychological Bulletin, 116, 429-456.
9. Folger, R., & Konovosky, M. (1989). Effects of procedural and distributive
justice on reactions to pay raise decisions. Academy of Management
Journal, 32, 115-130.
10. Foschi, M. (2000). Double standards for competence: Theory and research.
Annual Review of Sociology, 26, 21-42.
11. Harlan, A., & Weiss, C. (1982). Sex differences in factors affecting
managerial career advancement. In P. A. Wallace (Ed.), Women in the work
place (pp.59-96). Boston: Auburn House.
1. Visit to a big corporate located nearer to your place and interact with
managers or committee setup to sort out the discipline related matters and
cross verify with employees its positive and negative impacts on
organization.
18.12 KEYWORDS
Discipline, indiscipline, Maintenance of Discipline, Disciplinary action,
Discipline Procedure and Policy

174
LESSON 19
COMPENSATION
19.1 INTRODUCTION
Compensation is a systematic approach to providing monetary value to
employees in exchange for work performed. Compensation may achieve several
purposes assisting in recruitment, job performance, and job satisfaction.
Employees, in exchange of their work, generally expect some appreciation. Money is
considered as the most important moti vating factor for employees, though non -
financial incentives work efficiently. The goals of compensation management are to
design the lowest-cost pay structure that will attract, motivate and retain
competent employees.
"The most important thing is to note that compensation plays a major role in
attracting talent from the market and compensation system of the organization is
Key factor for creating employer brand, which is most important factor for
attracting talent people. Having talent people for the organization is a major asset
for the organization development"
19.2 OBJECTIVES
Introduction to Compensation:
Objectives of Compensation Functions
Factors Influencing Wage and Salary Administration
19.3 CONTENTS
19.3.1 Compensation
19.3.2 Objectives of Compensation Functions
19.3.3 Advantages of Compensation
19.3.4 Wage and Salary Administration
19.3.5 External factors influencing Wage and Salary Administration
19.3.6 Internal factors influencing Wage and Salary Administration
19.3.1 Compensation
Compensation is a tool used by management for a variety of purposes to
further the existence of the company. Compensation may be adjusted according to
the business needs, goals, and available resources.
Compensation may be used to:
Recruit and retain qualified employees.
Increase or maintain morale/satisfaction.
Reward and encourage peak performance.
Achieve internal and external equity.
Reduce turnover and encourage company loyalty.
Modify (through negotiations) practices of unions.
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Compensation packages can be considered total rewards systems, containing
non- monetary, direct, and indirect elements.
1. Non-Monetary Compensation: any benefit an employee receives from an
employer or job that does not involve tangible value.
2. Direct Compensation: an employees base wage which can be an annual
salary or hourly wage and any performance -based pay that an employee
receives.
3. Indirect Compensation: far more varied, including everything from legally
required public protection programs such as Social Security to health
insurance, retirement programs, paid leave, child care or moving expenses.
19.3.2 Objectives of Compensation Functions
The objective of wage and salary administration is numerous and sometimes
conflict with each other. The important among them are:
1. To acquire qualified and competent personnel: Candidates decide upon their
career in a particular organization mostly on the basis of the amount of
remuneration the organization offers. Qualified and competent people join
the best-paid organizations. As such, the organizations should aim at
payment of salaries at that level, where they can attract competent and
qualified people.
2. To retain the present employees: If the salary level does not compare
favorably with that of other similar organisation, employees quit the present
one and join other organizations. The organisation must keep the wage
levels at the competitive level, in order to prevent such quit.
3. To secure internal and external equity: Internal equity does mean payment
of similar wages for similar jobs within the organisation. External equity
implies that payment of similar wages to similar jobs in comparable
organisations.
4. To ensure desired behaviour: Good rewards reinforce desired behaviour like
performance, loyalty, accepting new responsibilities and changes, etc.
5. To keep labour and administrative costs in line with the ability of the
organisation to pay.
6. To project in public as progressive employer and to comply with the wage
legislations.
7. To pay according to the content and difficulty of the job and in tune with the
effort and merit of the employee
8. To facilitate pay roll administration of budgeting and wage and salary
control.
9. To simplify collective bargaining procedures and negotiations.
10. To promote organization feasibility
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Systems to Achieve the Objectives
The above mentioned objectives are achieved by the use of the following
systems.
1. Job evaluation: All jobs will be analyzed and graded to establish the pattern
of internal relationships. It is the process of determining relative worth of
jobs. It includes selecting suitable job evaluation techniques, classifying jobs
into various categories and determining relative value of jobs in various
categories.
2. Wage and salary ranges: Overall salary range for all the jobs in an
organisation is arranged. Each job grade will be assigned a salary range. The
individual salary ranges will be fitted into an overall range.
3. Wage and salary adjustment. Overall salary grades of the organisation may
be adjusted based on the data information collected about the salary levels
of similar organisations. Individual salary level may also be adjusted based
on the performance of the individual employees.
Principles
There are several principles of wage and salary plans, policies and practices.
The important among them are:
1. Wage, salary plan and policies should be sufficiently flexible.
2. Job evaluation must be done scientifically.
3. Wage and salary administration plan must always be consistent with overall
organizational plans and programmes.
4. Wage and salary administration plans and programmes should be in
conformity with the social and economic objectives of the country like
attainment of equality in income distribution and controlling inflationary
trends.
5. Wage and salary administration plans and programmes should be
responsive to the changing local and national conditions.
19.3.3 Advantages of Compensation
Compensation and benefits plan helps to attract, motivate and retain talent in
the organization. A well designed compensation and benefits plan will benefit the
organization in the following ways.
1. Job satisfaction: Your employees would be happy with their jobs and would
love to work for you if they get fair rewards in exchange of their services.
2. Motivation: We all have different kinds of needs. Some of us want money so
they work for the company which gives them higher pay. Some value
achievement more than money, they would associate themselves with firms
which offer greater chances of promotion, learning and development. A
compensation plan that hits workers needs is more likely to motivate them to
act in the desired way.
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3. Low Absenteeism: Why would anyone want to skip the day and watch not-so-
favourite TV program at home, if they enjoy the office environment and are
happy with their salaries and get what they need and want?
4. Low Turnover: Would your employees want to work for any other boutique if
you offer them fair rewards. Rewards which they thought they deserved?
19.3.4 Wage and Salary Administration
Remuneration provides more than a means of satisfying the physical
needs. It provides recognition, a sense of accomplishment and determines social
status. Hence formulation and administration of wage and salary to attract and
retain right personnel in right position is the prime responsibility of the
management in any organisation. Factors influencing wage and salary
administration.
19.3.5 External factors influencing Wage and Salary Administration
Demand and supply: The labor market conditions or demand and supply
forces operate at the national and local levels and determine organizational wage
structure. When the demand of a particular type of labor is more and supply is less,
then the wages will be more. On the other hand, if supply of labor is more demand
on the other hand, is less then persons will be available at lower wage rates also. In
the words of Mescon, the supply and demand compensation criterion is very closely
related to the prevailing pay, comparable wage and ongoing wage concepts since, in
essence all of these remuneration standards are determined by immediate market
forces and factors.
Cost of living: The wage rates are directly influenced by cost of living of a
place. The workers will accept a wage which may ensure them a minimum
standard of living. Wages will also be adjusted according to price index
number. The increase in price index will erode the purchasing power of
workers and they will demand higher wages. When the prices are stable then
frequent wage increases may not be un dertaken.
Trade unions bargaining power: The wage rates are also influenced by the
bargaining power of trade unions. Stronger the trade union higher well be
the wage rates. The strength of a trade union is judged by its membership,
financial position and type of leadership. Unions last weapon is strike which
may also be used for getting wage increases. If the workers are disorganized
and disunited then employers will be successful in offering low wages.
Government legislation: To improve the working conditions of workers,
government may pass a legislation for fixing minimum wages of workers.
This may ensure them a minimum level of living. In under developed
countries bargaining power of labour is weak and employers try to exploit
workers by paying them low wages. In India, Minimum Wages Act, 1948 was
passed to empower government to fix minimum wages of workers.
Psychological and social factors: Psychological the level of compensation is
perceived as a measure of success in life. Management should take into
178
consideration the psychological needs of the employees while fixing the wage
rates so that the employees take pride in their work. Sociologically and
ethically, the employees want that the wage system should be equitable, just
and fair. These factors should also be taken into consideration while
devising a wage programme.
Economy: Economy also has its impact on wage and salary fixation. While it
may be possible for some organizations to thrive in a recession, there is no
doubt that economy affects remuneration decisions. A depressed economy
will probably increase the labour supply. This, in turn, should lower the
going wage rate.
Technological development: With the rapid growth of industries, there is a
shortage of skilled resources. The technological developments have been
affecting skills levels at faster rates. Thus, the wage rates of skilled
employees constantly change and an organization has to keep its level up-to
the mark to suit the market needs.
Prevailing market rates: No enterprise can ignore prevailing or comparative
wage rates. The wage rates paid in the industry or other concerns at the
same place will form a base for fixing wage rates. If a concern pays low rates
then workers leave their jobs whenever they get a job somewhere else. It will
not be possible to retain good workers for long.
19.3.6 Internal factors influencing Wage and Salary Administration
Ability to pay: The ability to pay of an enterprise will influence wage rates
to be paid. If the concerns is running into losses then it may not be able to
pay higher wage rate. A profitable concern may pay more to attract good
workers. During the period of prosperity, workers are paid higher wages
because management wants to share the profits with labour.
Job requirements: Basic wages depend largely on the difficulty level, and
physical and mental effort required in a particular job. The relative worth of
a job can be estimated through job evaluation. Simple, routine tasks that
can be done by many people with minimum skills receive relatively low pay.
On the other hand, complex, challenging tasks that can be done by few
people with high skill levels generally receive high pay.
Management strategy: The overall strategy which a company pursues
should determine the remuneration to its employees. Where the strategy of
the organization is to achieve rapid growth, remuneration should be higher
than what competitors pay. Where the strategy is to maintain and protect
current earnings, because of the declining fortunes of the company,
remuneration level needs to be average or even below average.
Employee: Several employee related factors interact to determine his
remuneration, such as,
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1. Performance or productivity is always rewarded with a pay increase.
Rewarding performance motivates the employees to do better in future.
2. Seniority. Unions view seniority as the most objective criteria for pay
increases whereas management prefer performance to effect pay increases.
3. Experience. Makes an employee gain valuable insights and is generally
rewarded.
4. Potential. Organization do pay some employees based on their potential.
Young managers are paid more because of their potential to perform even if
they are short of experience.
1. Compensation: Compensation is a tool used by management for a variety of
purposes to further the existence of the company. Compensation may be
adjusted according to the business needs, goals, and available resources.
2. Non-Monetary Compensation: any benefit an employee receives from an
employer or job that does not involve tangible value.
3. Direct Compensation: an employees base wage which can be an annual
salary or hourly wage and any performance -based pay that an employee
receives.
4. Indirect Compensation: far more varied, including everything from legally
required public protection programs such as Social Security to health
insurance, retirement programs, paid leave, child care or moving expenses.
1. What are the factors affecting of wage and salary administration?
2. Define compensation. Differentiate between compensation, salary and wages
3. Discuss the role of direct and indirect compensation programmes in an
organization
4. Discuss some of the aspects to be considered while designing international
compensation.
19.6 SUMMARY
Wages incentives refer to performance linked compensation. Wage incentives
plans help to improve industrial relation, employee morale and productivity, work
methods and team work. Wage incentives plans may cause damage to employee
health, quality of work, industrial safety, interpersonal relations, etc., proper
climate, workers involvement, scientific standards, guaranteed minimum wage,
simplicity, equity, economy, flexibility, promptness, and provisi on for appeal and
follow-up are the essentials of a sound wage incentive plan.
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1. The following are all examples of direct compensation except
Pension
Salary
Bonus
Income
2. Cost of human resources refers to
Company profits
Employee shares
Salary packages
Earned revenues
3. The relative position of an organizations pay incentives compared to other
companies in the same industry is known as
Pay structure
Pay appraisal
Pay level
Pay feedback
4. An employees compensation usually comprise s
High monetary rewards
Quality rewards requested by employees
Benefits such as medical and transport allowances
Financial and non-financial rewards
5. Which of the following is a part of non -financial compensation?
Monthly commission
Employees autonomy
Stock option
Medical allowance
1. Bhatia S.K. (2003), New compensation management in changing
environment, Deep and Deep, Publishers, New Delhi.
2. Subha Rao.P., Rao, V.S.P, Personnel/Human Resource Management,
Konark Publishers, Pvt Ltd, Delhi, 1997.
3. Mamoria, C.B. and Ganker, S.V., Human Resource Management, Himalaya
Publishing House, Delhi, 2008.
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19.9 ASSIGNMENTS
Case Study (1)
In 2007, the Indian subsidiary of a multinational refinery became a
Government of India company. The government company had announced an
ambitious expansion programme which meant doubling the work force in less than
four years. In 2007 at the time of wage revision, the union and management agreed
to a two-tier pay structure. Those already employed will be eligible for a higher
grade and those who are (to be) recruited afresh will get a lower grade though jobs
are similar in skill, responsibility and effort. Both the union and the management
justified that this is an innovative practice widely followed in deregulated
companies abroad, particularly the airlines in North America.
Questions
1. Is it fair agreement?
2. Would it contravene with the concept of equal pay for equal work?
1. Argote, L. & Ingram, P. (2000). Knowledge Transfer in Organizations:
Learning from the experiences of others. Organization Behaviour and
Decision Processes, 82(1), 1-8.
2. Armstrong, M., (2006), Organization Development, Change &
Transformation, A Hand Book of Human Resource Management Practice,
Kogan Page Ltd. London
3. Burgoyne, J. (1988). Management Development for the Individual and the
Organisation. Personnel Management, 40-44.
4. Catalanello, & Kirkpatrick, D. L. (1968). Evaluation training programsthe
state of the art. Training and Development Journal, 22, no. 5, 2-9.
5. Fisher, Cynthia d, Schoenfeldt Lyle F. Shaw James. B (2004) Human
Resource Management, Biztantra, New Delhi p.543.
1. Make an enquiry with employees about the compensation packages offered
to them and their satisfaction. Understand the different types of
compensation offered by the company both in monetary form and non-
monetary form. Ask them which one has made huge impact on their job
satisfaction.
19.12 KEYWORDS
Compensation, Monetary and Non-Monetary Compensation, Compensation
Policies, Perquisites, employees satisfaction, Compensation package, compensation
management.

182
LESSON 20
EXECUTIVE COMPENSATION
20.1 INTRODUCTION
Compensation or remuneration for the executive managers is different from
compensation for other employees in most the organizations. Executive
compensation covers employees that include presidents of company, chief executive
officers (CEOs), chief financial officers (CFOs), vice presidents, occasionally
directors of the company, and other upper-level managers. These high level
employees are paid executive compensation.
Usually only those members of your most senior management team qualify for
executive pay. It is usual the members of the C-Suite. (A widely-used slang term
used to collectively refer to a corporation's most important senior executives. C-
Suite gets its name because top senior executives' titles tend to start with the letter
C, for chief, as in chief executive officer, chief operating officer and chief
information officer.)
20.2 OBJECTIVES
Executive Compensation Plans.
Benefits and Employee Services
Fringe Benefits Coverage of Fringe Benefits Employee Services.
Knowledge Creation and Management
Virtual Organization
Emerging HR Trend.
20.3 CONTENTS
20.3.1 Components of Executive Compensation
20.3.2 Employee Benefits
20.3.3 Types of employment benefits
20.3.4 Objectives of Fringe Benefits
20.3.5 Types of Fringe Benefits
20.3.6 Knowledge Creation
20.3.7 Managing Knowledge Creation
20.3.8 Virtual Organization
20.3.1 Components of Executive Compensation
Base salary
Incentive pay, with a short-term focus, usually in the form of a bonus
Incentive pay, with a long-term focus, usually in some combination of stock
awards, option awards, non-equity incentive plan compensation
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Enhanced benefits package that usually includes a Supplemental Executive
Retirement Plan (SERP)
Extra benefits and perquisites, such as cars and club memberships
Deferred compensation earnings
Many organizations, especially large ones, administer executive compensation
somewhat differently than compensation for lower-level employees. An executive
typically is someone in the top two levels of an organization, such as Chief
Executive Officer (CEO), President, or Senior Vice-President.
20.3.2 Employee Benefits
Employee benefits are optional, non-wage compensation provided to employees
in addition to their normal wages or salaries. These types of benefits may include
group insurance (health, dental, vision, life etc.), disability income protection,
retirement benefits, daycare, tuition reimbursement, sick leave, vacation (paid and
non-paid), funding of education, as well as flexible and alternative work
arrangements. Although expensive, there are many intrinsic benefits to providing
your employees with a comprehensive benefit plan. For most, it is the ability to find
and keep highly qualified staff that is the key driver. With the sector being highly
competitive and the number of new employees entering the workforce dwindling,
employers are challenged to become even more creative and responsive in the
design, timing and generosity of their benefit plans. The more progressive the
organization, the more flexible the structure is in response to todays challenges:
i.e. like having four different generations of employees working side by side.
Employers who continue to provide the more traditional and limited program, may
find it more difficult to find and keep different types of employees.
Here are just a few of the advantages of offering benefits to your employees:
For employers
By providing increased access and flexibility in employee benefits, employers
can not only recruit but retain qualified employees
Providing benefits to employees is seen as managing high-risk coverage at
low costs and easing the company's financial burden
Employee benefits have been proven to improve productivity because
employees are more effective with they are assured of security for themselves
and their families
Premiums are tax deductible as corporation expense, which means savings
for the organization
For employees
Employees can experience a peace of mind which leads to increased
productivity and satisfaction by being assured that they are their families are
protected in any mishap
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Employees with personal life and disability insurance can enjoy additional
protection including income replacement in the event of serious illness or
disability
Employees can feel a sense of pride in their employer if they are sati sfied
with the coverage they receive
Cash is not enough today to recruit and retain top talent for your business.
Providing an attractive benefits plan is just as important. Employee benefits are
given to an employee in the form of incentives, providing in surance, over time
payment or in non-financial form like giving training & development for employees
to develop their career and most importantly providing flexible working hours to
balance between work and life of employees.
In a recent survey, employees listed flexible work arrangements along with
additional fixed pay and higher incentives as the top three preferred benefits.
20.3.3 Types of Employment Benefits
Employers who hope to retain solid, hard-working employees should be
prepared to offer basic employee benefits. In addition to salary, good benefits
provide important resources that not only help build a positive working relationship
between employer and employee but also promote good work habits and financial
practices. Employee benefits will vary depending on the employer, and it is
important for business owners to carefully consider their options. For example, the
type of industry in which your business falls will help determine the types of basic
employee benefits important to your staff. A job that requires employees to work
outside in inclement weather, for example, might offer more paid sick leave than an
indoor office position. Different kinds of employment benefits are as follows;
Paid Vacations
Employee benefits includes vacations for employees for certain period of time
during the employment. Jobs under present corporate environment are stressful
which eventually effect the performance of the employee over a period of time.
185
Vacations makes employee re-energize and makes employee to forget about work
stress what they had faced in the job.
Paid time off
The definition of paid time off is any time not worked by an employee for which
the regular rate, a fixed or a prorated amount of pay, is accrued and paid to the
employee.
Perquisites
The term perqs (also perks)is often used colloquially to refer to those benefits
of a more discretionary nature. Often, perks are given to employees who are doing
notably well and/or have seniority. Common perks are take -home vehicles, hotel
stays, free refreshments, leisure activities on work time (golf, etc.), stationery,
allowances for lunch, andwhen multiple choices existfirst choice of such things
as job assignments and vacation scheduling.
Employee Health Insurance Benefits
The most fundamental of all basic employee benefits is health insurance,
which should be provided so that staff members can visit the doctor when they fall
ill. Not only does this help the employee save money, but it also helps the employer
by encouraging staff members to get treatment, thus allowing them to return to
work more quickly and not spread illness to the rest of the staff.
Paid Leave
Similar to employee health insurance benefits, paid leave allows sick
employees to stay home and recover without jeopardizin g their paychecks. Paid
leave, like paid vacation, can take many forms. For example, maternity and
paternity leave.
Retirement Plans
A retirement plan allows employees to prepare for their futures, securing their
financial stability after they have aged out of the work force. Furthermore, it is
easier for businesses to offer retirement benefits than most people think.
Fringe Benefits
Employees are paid several benefits in addition to wages, salaries, allowances
and bonus. These benefits and services are called fringe benefits because these
are offered by the employer as a fringe. The main features of fringe benefits are as
follows: (i) fringe benefits are a supplement to regular wages or salaries (ii) these
benefits are paid to workers not for any spe cific job or performance but to stimulate
their interest in the work (iii) fridge benefits involve a labour cost for the employer
and are not meant directly to improve efficiency. (iv) fringe benefits refer to items
for which a direct monetary value to the employee can be ascertained (v) fridge
benefits add to the workers standard of living or welfare and (vi) these benefits may
be statutory or voluntary
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20.3.4 Objectives of Fringe Benefits
20.3.5 Types of Fringe Benefits

Old age payments, Paid vacations, Survivor payments, Disability and health
insurance Profit sharing, Pension plans, Bonuses, Life insurance, Education
payments, Dental insurance, Worker's compensation, Accident insurance,
Unemployment compensation, Discounts on goods/services purchase d from the
company and Child care.
Some of these benefits are: housing (employer-provided or employer-paid),
group insurance (health, dental, life etc.), disability income protection, retirement
benefits, daycare, tuition reimbursement, sick leave, vacation (paid and non-paid),
social security, profit sharing, funding of education, and other specialized benefits
(Transportation facility/ Company Car, telephone facility, Free electricity, or Petrol
allowance).
20.3.6 Knowledge Creation
The ability to create new knowledge is often at the heart of the organization's
competitive advantage. Sometimes this issue is not treated as part of knowledge
management since it borders and overlaps with innovation management (Wellman
2009). Knowledge creation according to the Nonaka's SECI model is about
continuous transfer, combination, and conversion of the different types of
knowledge, as users practice, interact, and learn. Cook and Brown (1999)
distinguish between knowledge and knowing, and suggest that knowledge creation
is a product of the interplay between them. The shift in condition between the
possession of knowledge and the act of knowing - something that comes about
through practice, action, and interaction- is the driving force in the creation of new
knowledge. Furthermore, in order for this interplay to be most fruitful, it is
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important to support unstructured work environments in areas where creativity
and innovation are important.
20.3.7 Managing Knowledge Creation
The role of management in the knowledge creation process is thus as follows:
To enable and encourage knowledge sharing:
To create a suitable work environment:
To provide systems that support the work process
To provide knowledge workers with timely, relevant information and data.
20.3.8 Virtual Organization
This new form of organization, i.e., virtual organization emerged in 1990 and
is also known as digital organization, network organization or modular
organization. Simply speaking, a virtual organization is a network of cooperation
made possible by, what is called ICT, i.e. Information and Communication
Technology, which is flexible and comes to meet the dynamics of the market. The
term virtual organization is used to describe a network of independent firms that
join together, often temporarily, to produce a service or product. Virtual
organization is often associated with such terms as virtual office, virtual teams, and
virtual leadership. The ultimate goal of the virtual organization is to provide
innovative, high-quality products or services instantaneously in response to
customer demands. The term virtual in this sense has its roots in the computer
industry. When a computer appears to have more storage capacity than it really
possesses it is referred to as virtual memory. Likewise, when an organization
assembles resources from a variety of firms, a virtual organization seems to have
more capabilities than it actually possesses.
1. Compensation: Compensation or remuneration for the executive managers
is different from compensation for other employees in most the
organizations. Executive compensation covers employees that include
presidents of company, chief executive officers (ceos), chief financial officers
(cfos), vice presidents, occasionally directors of the company, and other
upper-level managers.
2. Fringe benefits: employees are paid several benefits in addition to wages,
salaries, allowances and bonus. These benefits and services are called
fringe benefits because these are offered by the employer as a fringe.
3. Virtual organization: this new form of organization, i.e., virtual
organization emerged in 1990 and is also known as digital organization,
network organization or modular organization. Simply speaking, a virtual
organization is a network of cooperation made possible by, what is called ict,
i.e. Information and communication technology, which is flexible and comes
to meet the dynamics of the market.
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4. Knowledge Creation: The ability to create new knowledge is often at the
heart of the organization's competitive advantage. Sometimes this issue is
not treated as part of knowledge management since it borders and overlaps
with innovation management (Wellman 2009). Knowledge creation according
to the Nonaka's SECI model is about continuous transfer, combination, and
conversion of the different types of knowledge, as users practice, interact,
and learn.
1. Define the terms of executive compensation. What are the component of
compensation?
2. What are the types of employment benefits?
3. Discuss about the fringe benefits.
4. Explain the knowledge creations.
5. Define compensation. Differentiate between compensation, salary and
wages.
6. Discuss the role of direct and indi rect compensation programmes in an
organization
20.6 SUMMARY
Knowledge sharing and knowledge creation thus go hand in hand. Knowledge
is created through practice, collaboration, interaction, and education, as the
different knowledge types are shared and converted. Beyond this, knowledge
creation is also supported by relevant information and data which can improve
decisions and serve as building blocks in the creation of new knowledge.
1. Discuss the various aspects to be considered whi le designing an
international compensation.
2. Is there any difference between fringe benefits among the different levels of
executives? Elucidate.
1. Subha Rao.P., Rao, V.S.P, Personnel/Human Resource Management,
Konark Publishers, Pvt Ltd, Delhi, 1997.
2. Mamoria, C.B. and Ganker, S.V., Human Resource Management, Himalaya
Publishing House, Delhi, 2008.
20.9 ASSIGNMENTS
Case Study
Gaurav cleaning centres doesnt have a formal wage structure nor does it have
rate ranges or use compensable factors. Wage rates are based mostly on those
prevailing in the surrounding community and tempered with an attempt on the part
of Gaurav to maintain some semblance of equity between what workers with
different responsibilities in the stores are paid. Ne edless to say, Gaurav doesnt
make any formal surveys when determining what his company should pay. He
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peruses the want ads almost every day and conducts informal surveys among his
friends in the local chapter of the laundry and cleaners trade association. While
Gaurav has taken a seat-of-the-pants approach to paying the employees, his
salary schedule has been guided by several basic pay policies while many of his
colleagues adhere to a policy of paying absolutely minimum rates, Gaurav has
always followed a policy of paying his employees about 10% above what he feels are
the prevailing rates, a policy that he believes reduces turnover while fostering
employee loyalty. Of somewhat more concern to Pragati is her fathers informal
policy of paying men about 20% more than women for the same job. Her fathers
explanation is, they are stronger and can work harder for longer hours and besides
they all have families to support.
Questions
1. Is the company at the point where it should be setting up a formal salary
structure based on a complete job evaluation? Why?
2. Gaurav policy of paying 10% more than the prevailing rates a sound one and
how could that be determined?
1. Catalanello, & Kirkpatrick, D. L. (1968). Evaluati on training programsthe
state of the art. Training and Development Journal, 22, no. 5, 2-9.
2. Fisher, Cynthia d, Schoenfeldt Lyle F. Shaw James. B (2004) Human
Resource Management, Biztantra, New Delhi p.543.
3. Mirza S.Saiyadain, Human Resources Management, Tata McGraw Hill
Publishing Company Limited, New Delhi, 2003.
4. Watkins, K. E., & Marsick, V. J. (1996). Creating the Organization.
Alexandria, VA: American Society for Training and Development.
5. Milton, L. Rock (1972) Handbook of Wage and Salary Administrati on. US:
McGraw-Hill Inc., ISBN 0070533482.
1. Make an enquiry with employees about the compensation packages offered
to them and their satisfaction. Understand the different types of
compensation offered by the company both in monetary form and non-
monetary form. Ask them which one has made huge impact on their job
satisfaction.
20.12 KEYWORDS
Compensation, Monetary and Non-Monetary Compensation, Compensation
Policies, Perquisites, employees satisfaction, Compensation package, compensation
management.

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UNIT - VI : PERFORMANCE APPRAISAL
LESSON 21
INTRODUCTION PERFORMANCE APPRAISAL
21.1 INTRODUCTION
Performance Appraisals is the assessment of individuals performance in a
systematic way. It is a developmental tool used for all round development of the
employee and the organization. The performance is measured against such factors
as job knowledge, quality and quantity of output, initiative, leadership abilities,
supervision, dependability, co-operation, judgment, versatility and health.
Assessment should be confined to past as well as potential performance also. The
second definition is more focused on behaviours as a part of assessment because
behaviours do affect job results.
Performance Appraisal is the systematic evaluation of the performance of
employees and to understand the abilities of a person for further growth and
development. Performance appraisal is generally done in systematic ways which are
as follows:
1. The supervisors measure the pay of employees and compare it with targets
and plans.
2. The supervisor analyses the factors behind work performances of employees.
3. The employers are in position to guide the employees for a better
performance.
21.2 OBJECTIVES
After reading this lesson you should be able to know
Meaning
Need and Importance
Objectives
Problems in performance Appraisal
Factors Influencing Performance Appraisal
21.3 CONTENTS
21.3.1 Need and Importance Performance Appraisal
21.3.2 Objectives of Performance Appraisal
21.3.3 Importance of Performance Appraisal
21.3.4 Performance Appraisal Process
20.3.5 Problems in Performance Appraisal
21.3.1 Need and Importance Performance Appraisal
Performance appraisal may be defined as an evaluation made by the employer or
the top management. The purpose of implementing or carrying out performance
appraisal activity is to judge the overall performance of the employees in the business
organization. It is by means of this activity that the aspects, whether the employee has
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essentially required skills, knowledge and attitude to perform the current tasks or the
assignments to be given in the future, are to be determined periodically. Moreover, it is
through the process the capacity of the employees to grow and develop in course of
time is to be assessed. In this way, performance appraisal program provides factual
information to be used as a basis to make differentiation between efficient and
inefficient employees in the business organization.
Performance appraisal activity to be carried out smoothly in a business
organization, various methods that lead to make inferences and predictions, are
adopted that, in turn, would be useful to bring a conclusive evidence to the overall
performance of the employees. And the sole purpose of any method is to make
observation thoroughly about the performance of the employees and other elated
factors so as to let them know where they stand and advise them how they need to
improve their performance. They are also to be notified for their weak areas in
which they need to put extra efforts to achieve a satisfactory level of performance or
for which they are to be trained. The process of performance appraisal also includes
determining promotion for those who deserve and the transfer in case it is to benefit
both, the employee as well as the organization .
It is necessary for a business organization to carry out the activity of
performance appraisal periodically as it entails twofold beneficial effect. To a
business it does help to grow strengthening total organizational competencies and
creating effectiveness and efficiency. To the employees, making them realize their
full potential, it becomes a source to motivate them to do their jobs in the best way.
21.3.2 Objectives of Performance Appraisal
Performance Appraisal can be done with following objectives i n mind:
1. To maintain records in order to determine compensation packages, wage
structure, salaries raises, etc.
2. To identify the strengths and weaknesses of employees to place right men on right
job.
3. To maintain and assess the potential present in a person for further growth and
development.
4. To provide a feedback to employees regarding their performance and related
status.
5. To provide a feedback to employees regarding their performance and related
status.
6. It serves as a basis for influencing working habits of the employees.
7. To review and retain the promotional and other training programs.
Objectives
The main objective of performance appraisals is to measure and improve the
performance of employees and increase their future potential and value to the
company. Other objectives include providing feedback, improving communication,
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understanding training needs, clarifying roles and responsibilities and determining
how to allocate rewards.
Providing Feedback
Providing feedback is the most common justi cation for an organization to
have a performance appraisal system. Through its performance appraisal process
the individual learns exactly how well he/she did during the previous twelve
months and can then use that information to improve his/her performance in the
future. In this regard, performance appraisal serves another important purpose by
making sure that the bosss expectations are clearly communicated.
Facilitating Promotion Decisions
Almost everyone in an organization wants to get ahead. How should the
company decide who gets the brass rings? Performance appraisal makes it easier
for the organization to make good decisions about making sure that the most
important positions are lled by the most capable individuals.
Facilitating Layoff or Downsizing Decisions
If promotions are what everybody wants, layoffs are what everybody wishes to
avoid. But when economic realities force an organization to downsize, performance
appraisal helps make sure that the most talented individuals are retained and to
identify poor performers who effects the productivity of the organization. (India's
largest software services provider TCS axed 1,000 jobs in the country due to non-
performance by its employees.
INDIA: Technology firm cognizant uses annual performance appraisal system
to assess its employees for the purpose of retaining talent and for Compensation
management. During its annual performance appraisal of the employees, the firm
has asked its employees identified as underperformers to leave the organisation.
Sources said there were more than 500 'underperformers' in the list, this could not
be verified.
Encouraging Performance Improvement
How can anyone improve if he doesnt know how hes doing right now? A good
performance appraisal points out areas where individuals need to improve their
performance.
Motivating Superior Performance
This is another classic reason for having a performance appraisal system.
Performance appraisal helps motivate people to deliver superior performance in
several ways. First, the appraisal process helps them learn just what it is that the
organization considers to be superior. Second, since most people want to be seen
as superior performers, a performance appraisal process provides them with a
means to demonstrate that they actually are. Finally, performance appraisal
encourages employees to avoid being stigmatized as inferior performers (or, often
worse, as merely average).
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Setting and Measuring Goals
Goal setting has consistently been demonstrated as a management process
that generates superior performance. The performance appraisal process is
commonly used to make sure that every member of the organization sets and
achieves effective goals.
Counselling Poor Performers
Not everyone meets the organizations standards. Performance appraisal forces
managers to confront those whose performance is not meeting the companys
expectations.
Determining Compensation Changes
This is another classic use of performance appraisal. Almost every organization
believes in pay for performance. But how can pay decisions be made if there is no
measure of performance? Performance appraisal provides the mechanism to make
sure that those who do better work receive more pay.
Encouraging Coaching and Mentoring
Managers are expected to be good coaches to their team me mbers and mentors
to their proteges. Performance appraisal identi es the areas where coaching is
necessary and encourages managers to take an active coaching role.
Supporting Manpower Planning
Well-managed organizations regularly assess their bench strength to make
sure that they have the talent in their ranks that they will need for the future.
Companies need to determine who and where their most talented members are.
They need to identify the departments that are rich with talent and the ones that
are suffering a talent drought. Performance appraisal gives companies the tool they
need to make sure they have the intellectual horsepower required for the future.
Determining Individual Training and Development Needs
If the performance appraisal procedure includes a requirement that individual
development plans be determined and discussed, individuals can then make good
decisions about the skills and competencies they need to acquire to make a greater
contribution to the company. As a result, they increase their chances of promotion
and lower their odds of layoff.
Determining Organizational Training and Development Needs
Would the organization be better off sending all of its managers and
professionals through a customer service training program or one on effective
decision making? By reviewing the data from performance appraisals, training and
development professionals can make good decisions about where the organization
should concentrate company-wide training efforts.
Validating Hiring Decisions
Is the company hiring stars, or is it lling itself with trolls? Only when the
performance of newly hired individuals is assessed can the company learn whether
it is hiring the right people.
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Providing Legal Defensibility for Personnel Decisions
Almost any personnel decisiontermination, denial of a promotion, transfer to
another departmentcan be subjected to legal scrutiny. If one of these is
challenged, the company must be able to demonstrate that the decision it made
was not based on the individuals race or handicap or any other protected aspect. A
solid record of performance appraisals greatly facilitates legal defensibility when a
complaint about discrimination is made.
Improving Overall Organizational Performance
This is the most important reason for an organization to have a performance
appraisal system. A performance appraisal procedure allows the organization to
communicate performance expectations to every member of the team and assess
exactly how well each person is doing. When everyone is clear on the expectations
and knows exactly how he is performing against them, this will result in an overall
improvement in organizational success.
Training Needed
These appraisals also identify the necessary training and development the
employee needs to close the gap between current performance and desired
performance.
Additional Objectives Performance Appraisal
To review the performance of the employees over a given period of time
To judge the gap between the actual and the desired performance.
To help the management in exercising organizational control.
Helps to strengthen the relationship and communication between superior
subordinates and management employees.
To diagnose the strengths and weaknesses of the individuals so as to
identify the training and development needs of the future.
To provide feedback to the employees regarding their past performance.
Provide information to assist in the other personal decisions in the
organization.
Provide clarity of the expectations and responsibilities of the fu nctions to be
performed by the employees.
To judge the effectiveness of the other human resource functions of the
organization such as recruitment, selection, training and development.
To reduce the grievances of the employees.
21.3.3 Importance of Performance Appraisal
The main advantages or importance of performance appraisal are:
1. Performance Feedback
Most employees are very interested in knowing how well they are doing at
present and how they can do better in a future. They want this information to
improve their performance in order to get promotions and merit pay. Proper
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performance feedback can improve the employee's future performance. It also gives
him satisfaction and motivation.
2. Employee Training and Development Decisions
Performance Appraisal information is used to find out whether an employee
requires additional training and development. Deficiencies in performance may be
due to inadequate knowledge or skills. For e.g. a professor may improve his
efficiency by attending workshops or seminars about his subject. Performance
appraisal helps a manager to find out whether he needs additional training for
improving his current job performance. Similarly, if the performance appraisal
results show that he can perform well in a higher position, then he is given training
for the higher level position.
3. Validation of Selection Process
Performance appraisal is a means of validating both internal (promotions and
transfers) and external (hiring new employees from outside) sources. Organisations
spend a lot of time and money for recruiting and selecting employees. Various tools
used in the selection process are application blanks, interviews, psychological tests,
etc. These tools are used to predict (guess) the candidate's performance on the job.
A proper performance appraisal finds out the validity of the various selection tools
and so the company can follow suitable steps for selecting employees in future.
4. Promotions
Performance appraisal is a way of finding out which employee should be given
a promotion. Past appraisals, together with other background data, will
enable management to select proper persons for promotion.
5. Transfers
Performance appraisal is also useful for taking transfer decisions. Transfers
often involve changes in job responsibilities, and it is important to find out the
employees who can take these responsibilities. Such identification of employees
who can be transferred is possible through the performance appraisal.
6. Layoff Decisions
Performance appraisal is a good way of taking layoff decisions. Employees may
be asked to lay off, if the need arises. The weakest performers are the first to be laid
off. If there is no performance appraisal, then there are chances that the best men
in the department may be laid off.
7. Compensation Decisions
Performance appraisal can be used to compensate the employees by increasing
their pay and other incentives. This is truer in the case of managerial jobs and also
in the case of employees in non-unionized organisations. The better performances
are rewarded with merit pay.
8. Human Resource Planning (HRP)
The appraisal process helps in human resource planning (HRP). Accurate and
current appraisal data regarding certain employees helps the management in
talking decisions for future employment. Without the knowledge of who is capable
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of being promoted, demoted, transferred, laid off or terminated, management
cannot make employment plans for the future.
9. Career Development
Performance appraisal also enables managers to coach and counsel employees
in their career development.
21.3.4 Performance Appraisal Process
The performance appraisal process follows a set of pattern and it consists of
the following steps
20.3.5 Problems in Performance Appraisal

Performance appraisal is important for organizations and employees.
Unfortunately, performance appraisals are not on the top of the list of "favourite
things to do" for either managers or employees, and there can be a number of
problems with their administration. From managers not being trained to conduct
performance appraisals effectively to the failure to tie performance appraisal
expectations to desired business results, businesses are often challenged to use
this tool effectively.
Poorly Trained Managers
Effective performance appraisal doesn't just happen and organizations
shouldn't assume that managers know how to conduct them effectively, even if they
have many years of experience as managers. In fact, since the process can differ
from organization to organization, it is important that training is provided to
introduce managers to the philosophy of performance appraisal at the organization,
including a review of the forms, the rating system and how the data gathered is
used. Training should take place regularly as a refresher both for new and veteran
managers.
Inconsistent Ratings
Inter-rater reliability is generally very low between managers at any
organization. What one manager considers to be "acceptable" performance, another
may consider "not meeting expectations." This can be a challenge for any
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organization and is made more of a challenge in situations where the criteria used
are subjective and not based on any measurable performance outcomes.
Lack of Outcome-Based Measures
Performance appraisals that ask managers to rate employees on subjective
criteria such as "customer service skills" or "leadership ability" lack specific
outcomes that can be tied to measurable results. The best performance appraisals
provide the ability for both managers and empl oyees to judge performance based on
measurable outcomes that are objective; level of sales, safety records and
evaluations from customers are all measurable ways of providing insight into an
employee's performance.
Not Used for Performance Improvement
The purpose of performance appraisal is not only to provide input to
employees about how they're doing, but also to provide the organization with an
indication of areas of employee strength and opportunities for improvement.
Unfortunately, few companies actually aggregate and use the results of
performance appraisal for performance improvement efforts. By analysing results
and taking advantage of both best practices in areas where employees are
performing well and opportunities for improvement in areas where they're not,
organizations can receive maximum value from their performance appraisal efforts.
Seven appraisal problems
Direct Bias.
1. Indirect bias.
2. Competency.
3. Devolution.
4. Authoritarianism.
5. Informal, incidental and ongoing appraising.
6. Information collection.
Direct bias
All people have biases. Research shows that biases often influence the
supposedly objective ratings a manager gives an employee during an appraisal.
Biases can be about favoured or disliked employees or influenced by how a
manager feels about the employee's political, religious, social, family or cultural
views. Numerous studies have shown managers give better ratings to those
employees most like themselves.
Indirect bias
Organizations use corporate values, symbols, rules, dress codes, rewards,
ceremonies and many other things to communicate what kind of people they most
prize. Organizations also have their own social, cultural and political environments
in which employees can assimilate or revolt. Evidence shows that these factors
influence how managers perceive performance; they often judge performance
against environmental compliance irrespective of actual performance.
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Competency
Only some organizations train managers on how to conduct a performance
appraisal. Very few organizations train nonmanagers on participating actively in
their appraisal meetings. This leads to inconsistencies across the organization on
how managers conduct appraisals and judge performance and therefore the process
lacks validity and integrity.
Devolution
Appraisal processes are often designed by HR and then rolled out to line
managers for implementation. Line managers have said they have no say in the
development of appraisals and how they are implemented. They claim a lack of
support from HR when they have difficulties. This causes confusion, resentment
and a lack of buyin from line managers.
Authoritarianism
Appraisal meetings are often managercentric. The manager dominates the
meeting. There is a power imbalance whereby the employee must justify themselves
and the manager sits in judgment. Many employees feel threatened, worried and
defensive at a time when they should feel empowered and confident. Often, instead
of having an open and supportive discussion, the employee says little. This
atmosphere adversely affects the outcomes of appraisals.
Informal, incidental and ongoing appraising
Many organizations view performance review and assessment as an event;
something done at a certain time each year. Managers are not formally trained or
supported to give ongoing, informal or incidental performance feedback. Often
performance problems go unaddressed because of this and small problems escalate
and linger which damages teamwork and morale.
Information collection
There is evidence that the 360 degree tool used to build a picture of an
individual's performance is misused and exploited. It adds a more subjectivity to a
process and allows for poor quality information to be provided behind the veil of
anonymity. Some managers take advantage of this and are selective with what
information they choose to build a picture of an employee's performance.
Factors Affecting performance Appraisal
Performance appraisal is an important process for any organization, large or
small. The effectiveness of a company's performance appraisal efforts will
depend on a number of factors, including how well documented and communicated
the process is, training for managers and supervisors, the evaluation and analysis
of results and ongoing improvement efforts.
Documented Process
Effective performance appraisal is formal and not left to chance. More than
just asking supervisors and managers to evaluate staff, effective systems provide
step-by-step guidance and standardized evaluation forms for all managers to
evaluate all employees. This not only lends to consistency, but also allows the
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results of the evaluations overall to be reviewed and compared to identify areas of
strength and areas where there may be opportunities for improvement. Making the
process as easy as possible for managers to follow will help ensure that
performance appraisal is effective.
Communication
Communicating the performance appraisal process, not only to new managers
but on an ongoing basis, can help remind all supervisors that the process exists,
what it is, how it works and where to get advice and assistance if needed. In
addition, business leaders and human resources staff should make sure managers
and supervisors understand why performance appraisal is important--to
employees, managers and the organization.
Training
Supervisors and managers dont automatically know how to conduct
performance appraisals. In addition, processes and philosophies at companies
differ, so training and education is critical. Training should take place regularly to
provide refreshers and updates on any changes to the process or the evaluation
forms.
Evaluation of Results
While performance appraisal generally focuses on one individual, looking at
the aggregated results of performance appraisals can tell a company a lot about the
general level of performance of its staff, areas where there may be training or
development needs and trends within and between departments.
Follow-Up and Performance Improvement
The greatest effect on performance appraisal effectiveness is how the business
uses the results. Employees both individually and across the organization should
use the appraisal system as a tool to improve performance.
Performance
The appraisal of an employee is directly dependent on the performance that he
has shown over a period of time. Every business wants to maximize its profits and
depends upon the collective effort of its employees to achieve it. If certain employees
perform up and above the expectations and help the company to achieve better
results, the organization would appreciate their efforts and give them a raise in
their salary. However, employees who have not performed to their full potential and
have not led to any major contribution to the company may not find any such
favours from the organization.
Teamwork
The way you behave in your office also has a huge impact on the appraisal
process. If you are known as a team player and help your colleagues to improve
their performance, it is highly likely that the organization would recognize your
efforts and reward you handsomely. This is one of the prime reasons that some
employees whose performance has not been exceptional still manage to have a
healthy raise in their appraisals. On the other hand, if you are someone who
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spreads rumours and negativity in the workplace, there is a possibi lity that you
would have a tough time during your appraisals.
Attendance and Punctuality
While it is OK to take a day off once in a while, but frequent absenteeism can
hamper your appraisal. Once you start calling in sick, your managers develop a
negative perception which is hard to shed. Tardiness on your part can also affect
your appraisal as an organizations put this to intense scrutiny. Various surveys
have found that 'average' employees who have lesser absenteeism and are punctual
get more favours from the managers, and this is one of the important factors that
plays a part during your appraisal.
Assertiveness/Motivation
Assertiveness and motivation are important characteristics that every
organization looks forward to in their employees. Employees who go about their
jobs with vigour and excitement, take initiatives and show a desire to perform
exceptionally are looked upon highly by the managers. Employees with a positive
attitude and self-belief are respected by the organization and are likely to be
rewarded for their efforts.
Process Knowledge
A friend of mine was disappointed when she came to know that her colleague
had been awarded a higher rating than her, even though she had generated more
sales. She was in a dilemma for a few days before her man ager sensed the situation
and decided to have a word with her so that there is no ambiguity. He told her that,
the reason she was not able to get a very good rating was because she lacked
process knowledge. Ignorance about your products can hamper your customer
experience besides marring the reputation of your company. When you do not know
enough about your products, it is difficult to convince the customers about the
benefits that they will derive from it.
Organizational Skills
Organizational skills reflect to your managers that you know how to prioritize
your more important tasks. A well-organized employee is always ready for any
additional responsibilities and the managers can trust him for his ability to get
something done. Organizational skill is an important attribute and plays an
important part in the appraisal process.
Customer Service
If you are someone who has generated a lot of revenue for your company at the
cost of your customer service, then there is a likelihood that your managers would
not be able to rely on you, and your relationship with them would be marked by a
trust deficit. Customer complaints are crucial for an organization and can also
result in a possible disciplinary action being taken against you.
Appearance
The way you dress up to office also plays an important part in determining the
course of your appraisal process. Employees who are presentable are more likely to
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create a positive image in the minds of managers than employees who are
dishevelled and do not dress up poorly to office.
Biased Managers
These factors are disadvantageous for an organization and promote ill will and
negativity in an organization. Managers sometimes show bias towards employees
with whom they have a friendly relationship as compared to those who are just
acquaintances. This creates nepotism and negativity in the workplace and hampers
the morale of hardworking employees.
These were some factors that affect an appraisal process. It is important for an
employee to ensure that he puts in an effort to contribute effectively to the
organization and managers have the added responsibility of ensuring that they are
able to carry out the appraisal in an effective and transparent way.
1. Performance appraisal
It may be defined as an evaluation made by the employer or the top
management. The purpose of implementing or carrying out performance
appraisal activity is to judge the overall performance of the employees in the
business organization
2. Competency
Only some organizations train managers on how to conduct a performance
appraisal. Very few organizations train nonmanagers on participating
actively in their appraisal meetings. This leads to inconsistencies across the
organization on how managers conduct appraisals and judge performance
and therefore the process lacks validity and integrity.
3. Assertiveness/motivation
Assertiveness and motivation are important characteristics that every
organization looks forward to in their employees. Employees who go about
their jobs with vigour and exci tement, take initiatives and show a desire to
perform exceptionally are looked upon highly by the managers.
1. What is performance appraisal? Describe its objectives.
2. Explain the importance of performance appraisal in HRM.
3. What are the factors affecting the effectiveness of performance appraisal
systems?
4. Explain the problems with performance Appraisals?
5. Discuss the process of evaluating employees performance
6. Discuss the importance of appraisal process
7. Contrast the traditional methods of appraisal with the modern methods
8. Write a note on assessment centres
9. What steps can be taken to reduce rater biases in the appraisal process
10. Suggest linkages between performance appraisal and performance
management
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21.6 SUMMARY
Performance appraisal is the process of assessing systematically the
performance of a person on the present job and his potential for higher level jobs in
future. It serves several purposes. Establishing performance standards,
communicating standards, measuring performance comparing it with the standard,
discussion and corrective actions are the steps in performance appraisal. Halo
effect, stereotyping, central tendency, constant error, personal bias, spillover effect,
inconsistency, incompetence, negative approach, multiple objectives and resistance
are the main problems in appraisal.
1. Common use of information generated through performance appraisal
include all of the following except:
administrative/personal decisions
Organizational training and development programme
Inputs for job content evaluation
Feedback on an individual performance
2. Which the performance appraisal techniques lists traits and a range of
performance?
Alternation ranking
Graphic rating scale
Management by objectives
Paired comparison
3. The continuous process of evaluating and managing both the behaviour and
outcomes in the workplace known as
Training and development
Performance appraisal
Compensation management
Job analysis
4. Organizations put maximum effort in measuring the performance of
employees because
It is cost effective
It helps in detecting the problems
It leads to product innovation
It assists in implementing new technology
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5. Which of the following performance appraisal methods is usually adopted for
evaluating performance in managerial position?
Management by Objectives
Critical incident
Paired comparison
Essay method
1. Huge J Arnold and Daniel C Feldman, Organisational Behavior, Singapore:
McGraw Hill Book Company, 1986 Edition.
Mumbai: Himalaya Publishing House. 2003 Edition.
21.9 ASSIGNMENTS
1. Prepare the questionnaire to evaluate the performance of a teachers who are
teaching different subjects in your class. Circulate the questionnaire among
the students to evaluate about the performance of every individual teacher
through rating scale methods and present the consolidated report.
1. Abraham, S. E., Karns, L. A., Shaw, K. & Mena, M. A. (2001). Managerial
competencies and the managerial performance appraisal process, Journal of
Management Development, 20 (10), 842 852.
2. Bass, B. M., & Einstein, W. O. (1987). Leadership and outcomes of
performance appraisal processes, Journal of Occupational Psychology, 60
(3), 177186.
3. Basu, Mihir K. (1981). Performance Appraisal in India, Delhi : Vikas Books.
4. Boice, D. F. & Kleiner, B. H. (1997). Designing effective performance
appraisal systems, Work Study, 46(6), 197 201.
5. Dorfman, P. W. Stephan, W. G. & Loveland, J. (1986). Performance
Appraisal Behaviors: Su pervisor perceptions and subordinate reactions,
Personnel Psychology, 39 (3), 579597
6. Jordan, J. L. & Nasis, D. B (1992) Preferences for Performance Appraisal
based on Method used type of rater and purpose of evaluation, Psychological
Reports, 70, 963-969.
7. Kuvaas, B., & Dysvik, A. (2009). Perceived investment in employee
development, intrinsic motivation and work performance, Human Resource
Management Journal, 19 (3), 217 236.
204
8. Mahalingam, S. (1987) Performance Appraisal of the LAMP Cooperative
Societies in Tribal Area in Tamil Nadu: A Case Study, Indian Co-operative
Review, Vol.XXV, No.1, NCUI, New Delhi.
9. Mayer, R. C., & Davis, J. H. (1999). The effect of the performance appraisal
system on trust for management: A field quasi-experiment, Journal of
Applied Psychology, 84 (1).
1. Visit to an IT company and try to understand the different methods
performance evaluation adopts by them to evaluate the employees
performance. Enquire with HR Manager about the performance appraisal
system in practice and try to understand the performan ce appraisal
methods in practice, its merits and demerits.
Case Study
First India BPO was started in the year 2000 by Chandran, a first generation
entrepreneur and the chief executive officer (CEO) of the company. Initially, the
company provided non-voice based services to its clients in Australia. However, the
real breakthrough came when the company bagged a 300 FTE (full time equivalent
employees) voice based call support contract for an Australian health care business
solution provider.
The employees were supposed to answer the incoming calls and address the
customers quarries on insurance coverage, claims status, and also sell the
insurance products in case the customers evinced interest to take an enhanced
coverage.
The company was able to manage the performance in the non-voice based
business as the employees were only required to fill in the customer insurance
application forms on the system, based on the scanned filled -in-forms received.
However, the company found tracking and appraising the pe rformance of employees
in the voice-based business, a different ball game altogether.
Chandran called his HR Manager and advised him to develop an appraisal
framework to manage and review the performance of the employees. The HR
manager arrived at the following framework for performance appraisal after
conducting job analysis and holding a series of discussions with the operations
manager:
Employees would state the generic goals and objectives at the beginning of
the year.
Employees would record their daily performance on the following metrics:
1. Average hold time for the customer
2. Revenue per hour (RPH)
3. Number of calls per hour
4. Average handle time (AHT)
5. Customer satisfaction rating
205
Employees would capture the aforementioned details on a daily basis. The
team leaders (the first line managers of employees) would randomly audit
these details to check their authenticity.
Managers would appraise the employees on a monthly basis through one-to-
one meetings
Managers would evaluate the employees on all the aforementioned
parameters.
The company would coach and counsel employees on career development
aspects
The company would rate employees on a performance scale of 1-5 as follows:
1. Rating 1 : Excellent
2. Rating 2: Very good
3. Rating 3: Good
4. Rating 4: Satisfactory
5. Rating 5: Needs Improvement
The company would place the employees with rating of 4 and 5 on a
performance improvement plan (PIP) of one month to coach and mentor
them for better performance.
At the end of the one month, If the performance improved on all parameters,
the country would pull out employees from the PIP.
If the employees performance does not improve at the end of one month, the
company would extend PIP by another one month.
If the performance improves by the end of the extended month, the company
would pull out employees from the PIP. If there is no improvement, they
would be put on a disciplinary action process. At the end of enquiry
process, if it is established that in spite of all the required support, there is
no improvement, the company would give the employees an option to resign
or it would terminate them.
21.12 KEYWORDS
Performance Management, Performance appraisal, Methods Performance
appraisal, Modern methods of Performance appraisal, Performance Evaluation,
Rating Scale Methods.

206
LESSION .22
TECHNIQUES OF PERFORMANCE APPRAISAL
22.1 INTRODUCTION
Numerous methods have been devised to measure the quantity and quality of
performance appraisals. Each of the methods is effective for some purposes for
some organizations only. None should be dismissed or accepted as appropriate
except as they relate to the particular needs of the organization or an employee.
22.1 OBJECTIVES
Traditional Techniques
Modern Techniques
22.3 CONTENTS
22.3.1 Methods of Performance appraisals
22.3.2 Past Oriented /Traditional Methods Performance Appraisal
22.3.3 Future Oriented /Modern Methods of Performance Appraisal
22.3.1 Methods of Performance Appraisals
Broadly all methods of appraisals can be divided into two different categories.
Past Oriented Methods
Future Oriented Methods
Otherwise above methods of performance appraisal called as Traditional
M ethods and M odern M ethods of Performance Appraisal:
Performance Appraisal Methods
22.3.2 Past Oriented /Traditional Methods Performance Appraisal

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1. Rating Scales
Rating scales consists of several numerical scales representing job related
performance criterions such as dependability, initiative, output, attendance,
attitude etc. Each scales ranges from excellent to poor. The total numerical scores
are computed and final conclusions are derived. Advantages Adaptability, easy to
use, low cost, every type of job can be evaluated, large number of employees
covered, no formal training required. Disadvantages Raters biases
2. Checklist
Under this method, checklist of statements of traits of employee in the form of
Yes or No based questions is prepared. Here the rater only does the reporting or
checking and HR department does the actual evaluation. Advantages economy,
ease of administration, limited training required, standardization. Disadvantages
Raters biases, use of improper weighs by HR, does not allow rater to give relative
ratings
3. Forced Choice Method
The series of statements arranged in the blocks of two or more are given and
the rater indicates which statement is true or false. The rater is forced to make a
choice. HR department does actual assessment. Advantages Absence of personal
biases because of forced choice. Disadvantages Statements may be wrongly
framed.
4. Forced Distribution Method
Here employees are clustered around a high point on a rating scale. Rater is
compelled to distribute the employees on all points on the scale. It is assumed that
the performance is conformed to normal distribution. Advantages Eliminates
Disadvantages Assumption of normal distribution, unrealistic, errors of central
tendency.
5. Critical Incidents Method
The approach is focused on certain critical behaviours of employee that makes
all the difference in the performance. Supervisors as and when they occur record
such incidents. Advantages Evaluations are based on actual job behaviours,
ratings are supported by descriptions, feedback is easy, reduces recency biases,
chances of subordinate improvement are high. Disadvantages Negative incidents
can be prioritized, forgetting incidents, overly close supervision; feedback may be
too much and may appear to be punishment.
6. Behaviourally Anchored Rating Scales
Statements of effective and ineffective behaviours determine the points. They
are said to be behaviourally anchored. The rater is supposed to say, which
behaviour describes the employee performance. Advantages helps overcome rating
errors. Disadvantages Suffers from distortions inherent in most rating techniques.
208
7. Field Review Method
This is an appraisal done by someone outside employees own department
usually from corporate or HR department. Advan tages Useful for managerial level
promotions, when comparable information is needed, Disadvantages Outsider is
generally not familiar with employees work environment, Observation of actual
behaviours not possible.
8. Performance Tests & Observations
This is based on the test of knowledge or skills. The tests may be written or an
actual presentation of skills. Tests must be reliable and validated to be useful.
Advantage Tests may be apt to measure potential more than actual performance.
Disadvantages Tests may suffer if costs of test development or administration are
high.
9. Confidential Records
Mostly used by government departments, however its application in industry is
not ruled out. Here the report is given in the form of Annual Confidentiality Report
(ACR) and may record ratings with respect to following items; attendance, self-
expression, team work, leadership, initiative, technical ability, reasoning ability,
originality and resourcefulness etc. The system is highly secretive and confidential .
Feedback to the assesse is given only in case of an adverse entry. Disadvantage is
that it is highly subjective and ratings can be manipulated because the evaluations
are linked to HR actions like promotions etc.
10. Essay Method
In this method the rater writes down the employee description in detail within
a number of broad categories like, overall impression of performance, promotion of
employee, existing capabilities and qualifications of performing jobs, strengths and
weaknesses and training needs of the employee. Advantage It is extremely useful
in filing information gaps about the employees that often occur in a better-
structured checklist. Disadvantages It its highly dependent upon the writing skills
of rater and most of them are not good write rs. They may get confused success
depends on the memory power of raters.
11. Cost Accounting Method
Here performance is evaluated from the monetary returns yields to his or her
organization. Cost to keep employee, and benefit the organization derives is
ascertained. Hence it is more dependent upon cost and benefit analysis.
12. Comparative Evaluation Method (Ranking & Paired Comparisons):
These are collection of different methods that compare performance with that
of other co-workers. The usual techniques used may be ranking methods and
paired comparison method.
Ranking M ethods: Superior ranks his worker based on merit, from best to
worst. However how best and why best are not elaborated in this method. It is easy
to administer and explanation.
209
Paired Comparison Methods: In this method each employee is rated with
another employee in the form of pairs. The number of comparisons may be
calculated with the help of a formula as under. N x (N-1) / 2
22.3.3 Future Oriented /Modern Methods of Performance Appraisal
1. Management by Objectives (MBO)
It means management by objectives and the performance is rated against the
achievement of objectives stated by the management. MBO process goes as under.
Establish goals and desired outcomes for each subordinate
Setting performance standards
Comparison of actual goals with goals attained by the employee
Establish new goals and new strategies for goals not achieved in previous
year.
Advantage It is more useful for managerial positions.
Disadvantages Not applicable to all jobs, allocation of merit pay may result in
setting short-term goals rather than important and long-term goals etc.
2. Psychological Appraisals
These appraisals are more directed to assess employees potential for future
performance rather than the past one. It is done in the form of in-depth interviews,
psychological tests, and discussion with supervisors and review of other
evaluations. It is more focused on employees emotional, intellectual, and
motivational and other personal characteristics affecting his performance. This
approach is slow and costly and may be useful for bright young members who may
have considerable potential. However quality of these appraisals largely depend
upon the skills of psychologists who perform the evaluation.
3. Assessment Centres
This technique was first developed in USA and UK in 1943. An assessment
centre is a central location where managers may come together to have their
participation in job related exercises evaluated by trained observers. It is more
focused on observation of behaviours across a series of select exercises or work
samples. Assesses are requested to participate in in-basket exercises, work groups,
computer simulations, role playing and other similar activities which require same
attributes for successful performance in actual job. The characteristics assessed in
assessment centre can be assertiveness, persuasive ability, communicating ability,
planning and organizational ability, self-confidence, resistance to stress, energy
level, decision making, sensitivity to feelings, administrative ability, creativity and
mental alertness etc. Disadvantages Costs of employees traveling and lodging,
psychologists, ratings strongly influenced by assesses inter-personal skills. Solid
performers may feel suffocated in simulated situations. Those who are not selected
for this also may get affected.
Advantages well-conducted assessment centre can achieve better forecasts
of future performance and progress than other methods of appraisals. Also
210
reliability, content validity and predictive ability are said to be high in assessment
centres. The tests also make sure that the wrong people are not hired or promoted.
Finally it clearly defines the criteria for selection and promotion.
4. 360-Degree Feedback
It is a technique which is systematic collection of performance data on an
individual group, derived from a number of stakeholders like immediate
supervisors, team members, customers, peers and self. In fact anyone who has
useful information on how an employee does a job may be one of the appraisers.
This technique is highly useful in terms of broader perspective, greater self-
development and multi-source feedback is useful. 360-degree appraisals are useful
to measure inter-personal skills, customer satisfaction and team building skills.
However on the negative side, receiving feedback from multiple sources can be
intimidating, threatening etc. Multiple raters may be le ss adept at providing
balanced and objective feedback.
1. Rating scales
Rating scales consists of several numerical scales representing job related
performance criterions such as dependability, initiative, output, attendance,
attitude etc.
2. Field review method
This is an appraisal done by someone outside employees own department
usually from corporate or hr department.
3. Management by objectives (MBO)
It means management by objectives and the performance is rated against
the achievement of objectives stated by the management.
4. 360-degree feedback
It is a technique which is systematic collection of performance data on an
individual group, derived from a number of stakeholders like immediate
supervisors, team members, customers, peers and self. In fact anyone who
has useful information on how an employee does a job may be one of the
appraisers.
1. What is Performance Planning?
2. What is Employee Retention?
3. What is the process of Performance Appraisal?
4. What is human resource development and what are the functions of HRD?
5. What is Redeployment?
6. Scientific Methods in Research Methodology
7. State the various techniques of performance Appraisals?
8. What are the techniques of Performance Appraisal?
211
22.6 SUMMARY
There are two types of performance appraisal methods adopts by the company
to evaluate the performance of the employees. These are traditional methods of
performance evaluation and modern methods of performance appraisal methods
which include the following: confidential report, free form, straight ranking, paired
comparison, forced distribution, graphic rating scales, checklist, critical incidents,
group appraisal and field review are the traditional techniques of performance
appraisal. Assessment centre, human resource accounting, behaviourally
anchored rating scales and MBO are modern techniques.
1. Write note on: Appraisal of Manager, Potential Appraisal, Assessment
Centre, and Behaviourally Anchored Rating Scales.
2. What are the objectives of performance appraisal? Explain
3. What do you mean by performance appraisal? Discuss the purposes of
appraisal. What is a process approach to performance appraisal?
4. Discuss the RSDQ model of 360 degree feedback system.
5. Discuss the essence of multi-source assessment and feedback system. What
are the differences of this system from a traditional appraisal system?
1. N.G. Nair and Lalitha Nair, Personnel Management And Industrial
Relations, New Delhi: S. Chand And Company Ltd., 2001 Edition .
3. Michael W. Drafke and Stan Kossen, The human side of organizations,
22.9 ASSIGNMENTS
Take help from your teacher or placement officer and visit five organization.
Meet the HR Manager or any other manager responsible for appraisal system in the
organization. Interrogate him to ascertain the status of adopting MAFS. You may
discover them in various stages not planning to adopt in near future, in the
managerial level, or implemented for selected managerial level, or implemented for
all levels. Collect information relating to the roadblocks, they are facing at the
respective stages. Further, collect their action plans to get rid of the roadblocks.
Many organizations have implemented MAFS and are deriving benefits. Identify five
such organization. Prepare an exhaustive list of benefits, and discuss it with your
teacher with your findings.
1. Axline.L.L 1994: Ethical consideration of performance appraisals
Management Review, March p.62
2. Bernardin, H.J and Beatty R.W. 1984, Performance Appraisal: Assessing
Human Behaviour at Work, Kent Publishing, Boston, p.86.
212
3. Church, A.H, Gogelberg, S.G., and Waclawski. J 2000: Since when is no
news good news? The relationship between performance and response rate
in multirater feedback; Personnel Psychology, Summer, pp.435-51.
4. Coleman. D. and Borman. W.C. 2000: Investigating the underlying structure
of the citizenship performance domain; Human resource Management
Review, 10, pp.25-44.
5. Findley, H.M., Mossholder, K.W and Giles, W.F 2000: Performance
Appraisal Process and System Facets; Applied Psychology, August,
pp-634-40.
6. Park.J and Chong. K.S 2000: A Comparision of absolute and relative
performance appraisal system; International Journal of Management,
September, pp.423-29.
7. Segal.J.A 1999: Performance Management for Jekyll and Hyde; HR
Magazine, February, pp.102-35.
1. Try to learn from the manager who has been responsible for evaluate the
subordinate performance by taking into consideration of some critical
incident happened during production process or accident at factory site or
during some important meeting to take financial decision. How he was rated
or evaluated the employee performance by adopting critical incident method
of performance evaluation during the above type of incident.
22.12 KEYWORDS
Performance appraisal, performance management, Performance appraisal
technique, performance appraisal methods, performance rating scale.

213
LESSON 23
QUALITY OF WORK LIFE (QWL)
23.1 INTRODUCTION
Quality of work life (QWL) refers to the favourableness or unfavourableness of
a job environment for the people working in an organization. The period of scientific
management which focused solely on specialization and efficiency, has undergone a
revolutionary change.
The traditional management (like scientific management) gave i nadequate
attention to human values. In the present scenario, needs and aspirations of the
employees are changing. Employers are now redesigning jobs for better QWL.
Definition
The QWL as strategy of Human Resource Management has assumed
increasing interest and importance. Many other terms have come to be used
interchangeably with QWL such as humanizations of work quality of working life,
industrial democracy and participative work.
There are divergent views as to the exact meaning of QWL. A few definitions
given by eminent authors on QWL are given below:
1. QWL is a process of work organizations which enable its members at all
levels to actively; participate in shaping the organizations environment,
methods and outcomes. This value based process is aimed towards meeting
the twin goals of enhanced effectiveness of organizations and improved
quality of life at work for employees.
2. The overriding purpose of QWL is to change the climate at work so that the
human-technological-organizational interface leads to a better quality of
work life. -Luthans
23.2 OBJECTIVES
Meaning
Issues in Quality of working Life
Measuring Quality of Working Life
Obstacles to Quality of Working Life Programmes
Quality Circles
Techniques
Effective Quality Circles
Empowering Employees
214
23.3 CONTENTS
23.3.1 Specific Issues in QWL
23.3.2 Measure Quality of Work Life (QWL)
23.3.3 Obstacles to Quality of Working Life Programs
23.3.4 Overcoming Barriers
23.3.5 Quality Circles
23.3.6 Objectives of a Quality Circle
23.3.7 Techniques for Improving the Quality of Work Life
23.3.8 Empowering Employees
23.3.9 Elements of Empowerment
23.3.10 Importance of Empowerment
23.3.1 Specific Issues in QWL
Besides normal wages, salaries, fringe benefits etc.., the specific issues are
being identified by the human resource managers on regular basis. Following
issues are highly relevant and determine the Quality of Work Life in any
organization;
Pay and stability of employment: Good pay dominates most of the factors
in employee satisfaction. Alternative means of providing wages should be
developed to increase the cost of living index, profession tax etc..,
Occupational stress: Its a condition of strain on employee emotions. Stress
is caused due to irritability, hyper excitation or depression, unstable
behaviour, fatigue, stirring heavy smoking and drug abuse has to be
identified.
Organizational health Programmes: Its helps to aim at educating about
health Programmes, means of maintaining and improving of health.
Alternative work schedules: Includes flexi times, work at home, staggered
hours, reduce work hours, part time employment.
Participative management and control of work: The trade unions and
workers believe that workers participation in management and decision -
making improves QWL.
Recognition: Rewarding system, congratulating the employees for their
achievement, job enrichment, offering membership in clubs or association,
vehicles, etc., recognizes the employees.
Congenial worker-supervisor relations: This gives the worker a sense of
social association, belongingness, achievement of work results etc.
Grievance procedure: Employees will have a fair treatment when the
company gives them the opportunity to ventilate their grievances and
present their case sincerely rather than settling the problem arbitrarily.
215
Adequacy of resources: Resources should match with states objectives;
otherwise employees will not be able to attain the objectives.
Seniority and meriting promotions: Seniority is considered as basis for
promotion. Merit is considered as the basis for advancement for managerial
people.
Employment on permanent basis: It gives security and leads to higher
order QWL.
23.3.2 Measure Quality of Work Life (QWL)
The following indices may be used to judge the quality of work life in an
organization:
Job Involvement. It represents the degree of an individuals identification with
or ego involvement in the job. The more central the job is to the individuals life, the
greater is his involvement in it. Therefore, the individual spends more time and
energy on the job. People with high job involvement are better motivated and more
productive. Research reveals that skills variety, achievement and challenge help to
improve job involvement.
Job Satisfaction. It implies the workers satisfaction with the environment of
his job environment consisting of nature of work, quality of supervision, pay, co -
workers, opportunities for promotion, etc. Job satisfaction is related to job
involvement and people involved in their jobs are satisfied with their jobs and vice
versa.
Sense of Competence. It refers to the feelings of confidence that an individual
has in his own competence. Sense of competence and job involvement reinforce
each other. An individual acquires a greater sense of competence as he engages
himself more and more in work activities. When he feels more competence as he
engages himself more and more in his job and becomes better motivated. When
both sense of competence and job involvement are high, the level of job satisfaction
also increases. Fig. shows the interrelationship between job characteristics, job
satisfaction, sense of competence and motivation.
216
Job Performance. When an individuals job involvement, job satisfaction and
sense of competence increase, there is a rise in job performance.
Productivity. When the level of job performance increase the output per unit
of input goes up. Thus, match between job characteristics and productivity traits of
employees generally result in higher productivity.
23.3.3 Obstacles to Quality of Working Life Programs
Barriers
1. A proper definition. Confusion exists about the definition of quality. "
Many companies are similarly confused in defining quality. Three prevalent
definitions of quality is a process, not a program. While programs-or training-
provide tools to implement the process, there is the danger that such activity will
become an end in itself or perceived.
2. Focus on quick fix. Management is under constant pressure to find and fix
problems quickly, with immediate results. This leads to treating symptoms instead
of solving problems. Treating symptoms is like taking two aspirin and drinking
orange juice for the common cold. You might feel a little better but you still have a
cold. Implement a problem-solving process. Management must provide a long-term
focus and look towards the future.
3. W hos responsible?. The great mystery of management is ""who's
responsible" for something rather than "what happened," and "how can we prevent
this problem from occurring in the future?" This barrier includes what' we
know and don't know about people, equipment, processes, products, and
services. It is important for employees and managers to realize what we know as
well as what we don't know opportunity to really do their job and have pride of
workmanship.
4. Failing to fix problem. People issues, management vs. leadership,
processes, procedures, and systems can all cause problems. Many times we treat
symptoms and overlook problems. The manager's role is to find and fix problems.
23.3.4 Overcoming Barriers
Barriers to quality take on many shapes and forms. In general, they involve
poor Human Resource Development and deployment. So to implement a quality
approach, management must create ways for employees to "buy in" to
organizational goals-that is, genuinely have a part of the "action."
1. Show what is expected. Every member of the organization must
understand what's expected of them and what requirements must be met for
success. Many employees are insecure because they don't know what's expected.
Management's job is to define this. Every employee has a right to know
requirements for processes, people, and equipment.' These expectations should be
well defined, concisely written, and clearly communicated. In fact, the employee
should be included in defining requirements.
2. Involve people. People involved in the decision-making process take more
responsibility for finding and implementing solutions. Involve people in ownership
217
of the ideas. A team' process lets individuals contribute to the long -term success of
a business, thus overcoming barriers. Earlier I discussed the focus on the quick fix,
failing to fix problems, and selfishness. Involving people throughout the
organization, at all levels, can help overcome these barriers.
3. Take a long-term approach. A long-term look is essential. In contrast, less
enlightened companies expect instant results. Can we implement such a short-term
outlook generally creates problems instead of overcoming barriers. A long-term plan
is important to success. What is long- term? The answer depends on your situation.
Anything less than three years is probably short-term.
4. Start small in beginning the Quality Improvement journey, start small.
Baseball teams are successful when they hit many singles "bunched together"
instead of two or three home runs scattered through the course of a game. That is
true in business as well. Look for the Small gains by starting small. Begin the
quality process by departments, for example, instead of company - wide. Look for
the small improvements. Focus attenti on in those areas. Why small? We must
learn to walk before we run.
5. Focus on teamwork. Many-managers believe they have a team when they
bring a group or task force together. It is easy to have a group, but more difficult to
build a team. Teams need training in how people work together, how teams
function, what process will be used, and group dynamics. Teamwork must cut
across organizational lines. It is important that people from different departments
work together.
6. Impart Training. It is an important and specific management
responsibility. The manager role is to identify training needs and provide needs-
based training oriented to on-the job results. Training is critical to the
organization's survival. Whether the training is simply how to set up a machine,
how to do a job, how to operate a computer, or sophisticated statistical methods
(such as designed experiments and process-control systems) it must be practical. It
is imperative to identify needs that employees must meet for success. People do not
need training in more than they need to know. Too much information can confuse
and frustrate them.
7. Communicate. Employees need to know, "What's going on" to be effective.
Management needs to know "what's going on" to be effective. Customers and
suppliers need to be involved in "what's going on." Communications can be a four-
lane highway instead of a one-way street. This can be represented by a square or a
rectangle involving customers, suppliers, employees, and management. The
manager ignored what the employee was saying rather than take action. Improving
communication is one of the most important ways to overcome barriers.
8. Encourage employees. The manager's role should be that of an encourager
instead of that of a nay-sayer. Good leaders assume the role of an encourager. The
day of the "policeman manager" is gone. The manager's role is to be involved with
people and encourage those actively involved in quality improvement. Encourage
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those who are not involved to get involved. The effective manager is a positive
questioner and an encourager.
23.3.5 Quality Circles
Quality Circles An Effective Tool for Management
Quality circles consist of a basically formal, institutionalized mechanism for
productive and participative problem solving interaction among the employees of an
organization. Quality circles are made of groups of employees (normally 6 to 12)
who perform similar tasks or share an area of responsibility. The groups meet on a
regular basis, usually under the leadership of a supervisor and often wi th
management, to discuss work related issues and to offer suggestions and ideas
which when implemented not only improve the performance of the organization but
also motivate and enrich the work of the employees. Quality circles operate on the
principle that employees participation in decision making and problem solving
improves the production methods and the quality. The characteristics of quality
circles are that they consist of volunteers who set their own rules and priorities,
take decisions by consensus and use organized approaches to problem solving.
Quality circles activities should not be in the direction of fault finding. When
matured quality circles become self-managing, and gain the confidence of
management. Quality circles enable the enrichment of the lives of the employees
and create harmony and high performance. Typical work related issues are
improvements in occupational health and safety, product design, manufacturing
processes and improvement in the workplace.
History
Quality circles dates back to 1950s when they were first seen in the United
States. But they were seriously developed and implemented by Dr. Kaoru Ishikawa
in Japan in 1960. The first quality circle was registered in 1962. Quality circles
were re-exported to USA in the early 1970s. International Association of Quality
Circles was formed in USA in 1977. BHEL Hyderabad was the first organization in
India to start quality circles in 1982.
23.3.6 Objectives of a Quality Circle
The perception of quality circles is Appropriateness for use and the tactic
implemented is to avert imperfection in services rather than their verification and
elimination later. Quality circle is not a task force because it can be made a
permanent feature of the organization. The objectives of a quality circle can be
broadly characterized as given below:
To contribute actively towards the improvement and development of the
organization.
To exist within the prevailing organizational structure to overcome the
barriers so as to foster an open exchange of ideas.
To develop a positive attitude and a feel of a sense of involvement in the
decision making process amongst the employees
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To help employees to respect humanity and to build a happy work place
worthwhile to work.
To display human capabilities completely and to draw out the numerous
possibilities in a long run.
To improve the quality of products and services.
To improve various competencies. This is also one of the goals in all
organizations.
To reduce the cost and the wasteful efforts in the long run.
To improve efficiencies which in turn reduce the lead time resulting in an
improvement in meeting customers due dates.
Customer satisfaction is the fundamental goal for any organization. Quality
circles help in achieving this goal and help the organization to be competitive for a
long time.
23.3.7 Techniques for Improving the Quality of Work Life
The term quality of work life has become popular after 1970. Research is going
on to find out the new ways and means to improve QWL.
1. Job Enrichment
Under traditional management, the principle of division of work and
specialization was applied so that an individual could do a particular work more
efficiently. However, this made the job of workers monotonous. They started feeling
bored by doing the same work again and again. Management also started realizing
it as a process of dehumanization.
Kerzberg in his two factor theory of motivation tried to use job as a medium of
developing people and changing some organizational practices. Job enrichment can
lead to extension of job contents. It also develops competence of employees who
voluntarily come forward to share higher responsibilities.
2. Job Rotation
A vertical job rotation means promotion whereas a horizontal job rotation
means transfer to some other job. Job rotation makes an employee to learn the new
job at the new seat thereby creating interest in the new job. The problems
associated with specialization such as boredom and monotony are automatically
removed as the worker becomes generalist from specialist.
3. Quality Circles (or Self-managed Work Teams)
The concept of Quality Circles was made popular in Japan in 1960 by K.
Ishikawa. Japan has gained a lot by applying the Statistical Quality Control (SQC)
techniques for production.
Quality circles can be defined as a small group of some people (may be 3 to 12)
who meet for an hour every week to identify, analyses and solve the problems related
to their work. The solutions are sent to the management for implementation.
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Quality Circles develop a culture of participation among the workers. It also
reflects the democratic set up where the management keeps full faith in the employees
and also there is a complete understanding between the management and workers.
23.3.8 Empowering Employees
Simply stated, empowerment means allowing a person to turn the show by
himself. Empowered employees become self-directed and self-controlled. This is
possible only when there is mutual trust between the superior and his
subordinates. The superior has full faith that his subordinates will not do anything,
which is detrimental to the organization. Similarly, the subordinate has confidence
in his superior that he will support his decisions and actions. An empowering
manager treats his employees with respect and dignity. He puts authority,
responsibility and resources at the most appropriate level for each job.
A few definitions of empowerment are given below:
Empowerment is any process that provides greater authority through the
sharing of relevant information and the provision of control ove r factors affecting
job performance.
John Newstrom and Keith Davis
Empowerment means encouraging and allowing individual s to take personal
responsibility for improving the way they do their jobs and contribute to the
organizations goals. It requires the creation of a culture which both encourages
people at all levels to feel that they can make a difference and helps them to acquire
the confidence and skills to do so.
Richard Carver
23.3.9 Elements of Empowerment
The main elements of empowerment are as follows:
Sense of personal control over ones immediate work situation.
Self-sufficiency or Competence. It means the feeling that one is capable of
success fully performing a particular task. Employees will not accept responsibility
for making decisions until they are confident of their abilities.
Meaningfulness. It means the feeling that the task is valuable both to the
organization and to oneself. Employees know how their tasks fit into the larger
scheme of things.
Impact. It refers to the belief that one has an influence on decisions of the
organization. Impact is felt when employees perceive that their behaviour has
caused important outcomes.
Impact. When an employee feels that completion of task Will make a
difference, such task has an impact on him.
Competence. When a person has confidence that he has the ability,
knowledge and skill to perform the task assigned to him, then such tasks positively
affect competence.
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Meaningfulness. When employee feels that the task assigned to him is
worthwhile and he cares to do so, such task is meaningful.
Choice. A task which provides him freedom of decision-making initiative and
action, we find the factor choice in such task.
23.3.10 Importance of Empowerment
Knowledge W orkers: Knowledge employees are not prepared to accept the old
command and control systems. They want job environment which provides them
opportunities for exercising control over work related decisions. Organizations
which fail to provide such opportunities continuously lose their best employees.
Cut Throat Competition : In order to Survive and grow in competitive era,
organizations must meet the needs of customers more effectively. For this purpose,
cross functional working and close cooperation is required. Empowerment can
provide such cooperation. When the customer demands rapid action it is easier to
meet the demand through employee empowerment than through changes in
process and technology.
Speed and Flexibility : Growing turbulence of environment requires quick
response which is not possible under the old command and control model of the
part of staff. Empowered managers can focus more on external changes than
internal problem-solving.
Globalization: Economic liberalization and globalization are leading to
downsizing, delayering and decentralization. In order to achieve coordination and
control in the new economy, staff must exercise much greater responsibility.
Human Resource Development. Empowerment helps to reveal and utilize
untapped potential of employees. Thus, employee empowerment helps to develop a
flexible, responsive and adaptive organization. It represents a major cultural change
representing the way an organization defines itsel f, its priorities and values and the
way it deals with its people to change their mindsets.
1. Quality of work life
(QWL) refers to the favourableness or unfavourableness of a job environment
for the people working in an organization. The period of scientific
management which focused solely on specialization and efficiency, has
undergone a revolutionary change.
2. Quality circles
It consist of a basically formal, institutionalized mechanism for productive
and participative problem solving interaction among the employees of an
organization
3. Empowerment
It means encouraging and allowing individual s to take personal
responsibility for improving the way they do their jobs and contribute to the
organizations goals. It requires the creation of a culture which both
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encourages people at all levels to feel that they can make a difference and
helps them to acquire the confidence and skills to do so.
1. What is QWL? How will you measure it?
2. Suggest techniques for improving the QWL.
3. What are the obstacles to quality of working life programmes?
4. Explain the techniques for improving the quality work life.
5. Discuss the Issues of quality work life.
6. How can overcoming the Barriers to QWL?
7. Describe Quality circle and its objectives.
8. Define the terms work life and family life
9. Discuss the four life quadrants-work, family, friends and self.
10. What is the role of the employer to maintain work life balance?
11. Discuss the role of employee while implementing work-life balance in an
organization
12. What should be the HR mantra in the context of work-life-balance?
23.6 SUMMARY
Quality of Work Life means the relationship between employees and their total
working environment. The job involvement, job satisfaction, sense of competence,
productivity etc., are used as indicators of QWL. Compensation, working
conditions, opportunity to growth, social integration in work force, balance between
personal and work life and social relevance of work are the main dimensions of
QWL. Security, equity, individualism, democracy are the main principles of QWL.
Job enrichment, career growth, self-managed work groups, flexible work schedules,
participative management, job security, administrative justice are the main
techniques used to improve QWL.
1. How can this problem be solved?
2. Will you suggest the need for the intervention of a career counsellor?
1. Wayne F. Cascio and Herman Aguinis, Applied Psychology In Human
2009, Edition.
Mumbai: Himalaya Publishing House. 2003 Edition.
3. Meredith J.R., The Management of operations, New York: John Wiley &
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23.9 ASSIGNMENTS
1. Take the help of a professor teaching work-life balance to get an
appointment from an enterprise that practices work-life balance. Collect
information about the method of maintaining work-life balance and its
impact on the employee mindset. Show your notes to the professor who
helped you to get the appointment and your professor teaching HRM and
HRD.
2. A person joined a private company about seven years back. He joined as an
assistant manager; was promoted twice, and is now designated as a
marketing manager. He is a manager with proven track record. He is likely
to be promoted within a year as senior manager. Recently, he married a
lady who was an English teacher in a higher secondary school. Her mothers
house and the school are at distance of about 120 kilometres from her
husbands company quarters. After marriage, she continued teaching and
stayed with her husband in the weekends. To pursue her family life, she
tendered her resignation to the school. The problem stemmed from that
time. Being a career-oriented husband, he stayed in office for long hours
and returned home late in the evening. He was in pursuit of achievement;
while his wife insisted him to come home after normal office hours. His
inclination to enjoyment was minimal. Consequently, he could not strike a
balance between the two roles.
1. Baba, VV and Jamal, M (1991) Routinisation of job context and job content
as related to employees quality of working life: a study of psychiatric nurses.
Journal of organisational behaviour. 12. 379-386.
2. Bearfield, S (2003) Quality of Working Life. Aciirt Working paper 86.
University of Sydney. www.acirrt.com
3. Easton, S. & Van Laar, D. (2013) User Manual for the Work-Related Quality
of Life (WRQoL) Scale. University of Portsmouth.
4. Edwards, J., Van Laar, D.L. & Easton, S. (2009). The Work-Related Quality
of Life (WRQoL) scale for Higher Education Employees. Quality in Higher
Education. 15: 3, 207-219.
5. Ellis N & Pompli A 2002 Quality of working life for nurses. Commonwealth
Dept. of Health and Ageing. Canberra.
6. Herzberg F, Mausner B, & Snyderman B., (1959): The Motivation to Work.
New York:Wiley.
7. Lawler III E and Porter L, (1966): Managers pay and their satisfaction with
their pay. Personnel Psychology. XIX 363-73.
8. Lawler, E. E. (1982): Strategies for improving the quality of work life.
American Psychologist, 37, 2005, 486-493.
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9. Loscocco, K. A. & Roschelle, A. N. (1991): Influences on the Quality of Work
and Nonwork Life: Two Decades in Review. Journal of Vocational Behavior,
39, 182-225.
10. Mirvis, P.H. and Lawler, E.E. (1984) Accounting for the Quality of Work Life.
Journal of Occupational Behaviour. 5. 197-212.
11. Sirgy, M. J., Efraty,, D., Siegel, P & Lee, D. (2001): A new measure of quality
of work life (QoWL) based on need satisfaction and spillover theories. Social
Indicators Research, 55, 241-302.
12. Taylor J C in Cooper, CL and Mumford, E (1979): The quality of working life
in Western and Eastern Europe. ABP
13. Thompson, E.R; Phua, F.T.T. (2012): "A Brief Index of Affective Job
Satisfaction". Group & Organization Management 37 (3): 275307.
14. Van Laar, D, Edwards, J & Easton, S (2007). The Work-Related Quality of
Life scale for healthcare workers. Journal of Advanced Nursing, Volume 60,
Number 3, pp. 325333
15. Warr, P, Cook, J and Wall, T (1979) Scales for the measu rement of some
work attitudes and aspects of psychological well -being. Journal of
Occupational Psychology. 52, 129-148.
16. Worrall, L. & Cooper, C. L. (2006). The Quality of Working Life: Managers
health and well-being. Executive Report, Chartered Management Institute.
1. Study the health and safety measures in a manufacturing company.
2. Prepare a report on health and safety measures in a service industry,
preferably hospital, logistics etc., and Discuss with measures positive and
negative impact with organization.
3. Prepare an analytical report on QWL and its relevance to the IT Industry and
get interact with person who is responsible for QWL in the organization.
23.12 KEYWORDS
Quality of work life, working condition, caring organization, grievances
procedures, job satisfaction, job involvement.

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LESSON-24
DEVELOPMENT IN HRM
24.1 INTRODUCTION
E-HRM is the (planning, implementation and) application of information
technology for both networking and supporting at least two individual or collective
actors in their shared performing of HR activities. E-HRM is not the same as HRIS
(Human resource information system) which refers to ICT systems used within HR
departments. Nor is it the same as V-HRM or Virtual HRM - which is defined by
Lepak and Snell as "...a network-based structure built on partnerships and
typically mediated by information technologies to help the organization acquire,
develop, and deploy intellectual capital."
24.2 OBJECTIVES
e-HRM
HR outsourcing
e- HR Activities
e-Recruitment
e- Selection
e- Training
e- Performance Management
360* and 720* Performance Appraisal
e- Compensation
24.3 CONTENTS
24.3.1 E HRM
24.3.2 E- HR Activity
24.3.3 E-Recruitment
24.3.4 E-Selection
24.3.5 E-Training
24.3.6 E-Performance Management
24.3.7 360Performance Appraisal
24.3.8 720 Performance Appraisal
24.3.1 E HRM
E-HRM is the use of web-based technologies to provide HRM services within
employing organizations. It embraces e-recruitment and e-learning, the first fields
of human resource management to make extensive use of web-based technology.
From this base e-HRM has expanded to embrace the delivery of virtually all HR
policies. Within a system of e-HRM, it is possible for line managers to use desktop
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computers to arrange and conduct appraisals, plan training and development,
evaluate labour costs, and examine indicators for turnover and absenteeism.
Employees can also use a system of e -HRM to plan their personal development,
apply for promotion and new jobs, and access a range of information on HR policy.
Systems of e-HRM are increasingly supported by dedicated software produced by
private suppliers.
E-HRM is in essence the devolution of HR functions to management and
employees. They access these functions typically via intranet or other web-
technology channels. The empowerment of managers and employees to perform
certain chosen HR functions relieves the HR department of these tasks, allowing HR
staff to focus less on the operational and more on the strategic elements of HR, and
allowing organizations to lower HR department staffing levels as the administrative
burden is lightened.
Types
There are three tiers of E-HRM. These are described respectively as
Operational, Relational and Transformational. Operational E-HRM is concerned
with administrative functions - payroll and employee personal data for example.
Relational E-HRM is concerned with supporting business processes by means of
training, recruitment, performance management and so forth. Transformational E-
HRM is concerned with strategic HR activities such as knowledge management,
strategic re-orientation. An organisation may choose to pursue E-HRM policies from
any number of these tiers to achieve their HR goals.
Goals
E-HRM is seen as offering the potential to improve services to HR department
clients (both employees and management), improve efficiency and cost effectiveness
within the HR department, and allow HR to become a strategic partner in achieving
organisational goals.
HR Outsourcing
Today, organizations are looking at every possible avenue to reduce costs and
increase efficiency. The human resource (HR) department is not immune to this
trend. High rates of attrition, employee disengagement and cost reducti on
pressures are driving the need to implement a Centralized Shared Services Model.
Chief HR Officers of leading organizations are aiming to leverage Human
Resource Outsourcing (HRO) as a sustainable and competitive method to manage
costs and allow the companys core resources to focus on strategic initiatives rather
than managing transactional activities in HR operations.
WNS su pports organizations in meeting their HR objectives by extending the
enterprise through comprehensive service offerings for HR functions. Our solutions
enable clients to outperform challenges like:
Manage high cost of HR operations
Adhere to quality parameters
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Handle routine HR activities which require high amount of manual
intervention
Manage disparate legacy HR systems
WNS partners with clients across various industry verticals, including travel,
retail and manufacturing, among others. WNS successfully supports multiple ERP
platforms of its clientele, which include pre -configured best-in-class HR processes,
industry frameworks and country-specific localizations to deliver services in
multiple languages through a robust global delivery network spread across the
U.S., the U.K., Europe, APAC and South Africa.
24.3.2 E- HR Activity
Activity oriented research firstly refers to the question whether and to what
extent HRM is carried out electronically, i.e. addresses the diffusion of e -HRM.
Besides studies that examine the diffusion within single HR activities or functions
like e-recruiting or e-selection, there are also studies that address the diffusion of e-
HRM as a whole.
Two UK based studies reveal that the general application of IT in HR has
spread but remains on an administrative level. Mainly administrative tasks like
payroll are supported, while advanced strategic or decision support orientated
applications are lacking (Kinnie and Arthurs, 1996, Lin, 1997, Ball, 2001 and Teo
et al., 2001). Yet, there were also signs for the beginning of non -administrative
applications of IT (Ball, 2001 and Teo et al., 2001).
Besides this, there is broader empirical evidence for a wide spread use of e -
recruiting in North America where the Internet has become an ordinary recruiting
source, however, without displacing conventional media (Elliott and Tevavichulada,
1999, Hausdorf and Duncan, 2004, Kuhn and Skuterud, 2000 and Pearce and
Tuten, 2001). Besides corporate web sites, primarily Internet job boards are utilized
in order to realize e-recruiting (Hausdorf & Duncan, 2004). The prevalent use of e-
recruiting is also revealed for the public sector, however at a more moderate level
since the full range of available options is not realized (West and Berman, 2001). In
addition, a further survey depicts the frequent use of employee rsum
management systems within fortune 500 companies (Baker, DeTienne, & Smart,
1998).
Compared to e-recruiting, e-selection seems to be in an earlier and developing
stage since findings reveal a rather limited application (Chapman and Webster,
2003, Elliott and Tevavichulada, 1999 and West and Berman, 2001). However,
concerning the role of initial screening, e-selection seems to be a growing field since
organizations anticipate an increasing application using technologies like key word
search, web-based tests, or videoconferencing for all kinds of employees (Chapman
& Webster, 2003).
E-Training and-development, or as often labelled e-learning, comprises the
(planning, implementation and) application of all kinds of learning that use IT for
distributing of learning content and/or for communication. Studies concerning the
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diffusion show that approximately four out of ten organizations apply e -learning,
accordantly in private and public organizations (Elliott and Tevavichulada,
1999 and West and Berman, 2001).
These activities are followed by other HR activities, (in descending orde r:
compensation management, performance appraisal, affirmative action, HR
planning, labour relations, and job analysis) which are electronically performed
(Elliot & Tevavichulada, 1999).
In brief, there is an initial body of research concerning the diffusi on of e-HRM.
However, the internationally wide spread use of e -HRM commonly agreed upon in
the literature is only partly confirmed by current studies. This may be due to a lack
of actual diffusion studies. The findings presented may be out of date due to the
ever-changing state of technology application.
24.3.3 E-Recruitment
In terms of the organization's objectives, the primary goal of the recruitment
process is to attract potential applicants (prospects) who have the KSAOs needed to
meet the requirements of organizational roles. Thus, organizations are increasingly
using the Internet to advertise job openings and attract qualified prospects. The
web-based advertisements often provide prospects with information about (a) job
vacancies, (b) job descriptions, (b) the organization's culture and its brand
identity, and (d) the inducements (e.g., pay, fringe benefits, learning opportunities,
promotion prospects) offered its employees. Interestingly, some estimates indicate
that 100%of large firms currently use the Internet to announce job openings, and
82% of large firms use intranet systems to post openings or identify qualified
employees within the organization (Cedar, 2002). For example, organizations have
developed sophisticated web-based recruiting systems to convey information about
job opportunities and give applicants the ability to complete applications online
(Stone, Johnson, Navas, & Stone- Romero, 2005; Stone, Lukaszewski, & Isenhour,
2005). In addition, organizational intranet systems are often used to search
employment records to determine if the KSAOs of current employees are consistent
with the requirements of vacant or soon -to-be vacant roles. Such systemsmay
automatically provide managers with lists of qualified employees, and notify
individuals about new job opportunities. In addition, the same systems may send
messages to employees that ask about their interests in job openings. Overall, e -
HR-based recruiting systems are thought to reach a much wider set of prospects
than traditional recruiting systems (Gueutal & Stone, 2005; Stone, Lukaszewski et
al., 2005).
Internet-based e-HR systems are also used to provide job applicants
(applicants) with virtual previews of organizations. For instance, some organizations
use real time cameras to give prospects a preview of what it is like to work in the
organization on a daily basis. Other organizations (e.g., Cisco Systems) use such
systems to give job applicants the opportunity to make friends in the organization.
Through the resulting contacts, prospects can gather considerable information
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about the benefits and challenges of working for the organization. As a result of the
availability of information about role requirements and inducements, applicants
can determine if their (a) needs can be satisfied by offered inducements, and (b)
KSAOs are likely to enable them to meet role requirements.
Though a great deal of organizations believe e-recruiting systems permit firms
to cast a wide net across a broad labour market, and is more likely than traditional
recruitment sources to uncover individuals with unique talents and skills,
researches show that e-recruiting only attracts greater numbers of candidates than
other sources, but not necessarily attracts higher quality applicants or candidates
who are most suitable for the companies than traditional sources (Chapman &
Webster, 2003; Galanaki, 2002). McManus and Ferguson (2003) discovers: given
that some types of candidates may be more likely to use e -recruiting than the
others (for instance, "job hoppers" or savvy internet navigators), the use of the e -
recruiting systems may actually affect the characteristics of new hires in
organizations, and influence the overall composition of the workforce. McManus
and Ferguson (2003), Galanki (2002), Zusman and Landis (2002) further argue that
there are age, gender, and ethnic differences in reactions to and usage of online
recruitment sources, therefore, organizations should not use online recruiting as
the sole recruitment sources.
24.3.4 E-Selection
There are three purposes for all the HR e-enablement (Kehoe, Dickter, Russell
& Sacco, 2005): (1) to minimize cost, (2) to maximize the utilization of the
organization's human capital, (3) to enable sustainability which refers to the
organization's willingness and ability "not only to maintain the e-enabled system,
but to progressively evolve the system to satisfy changing requirements, and
capitalize on improvements in technology and the science of selection". The
purposes for e-enabling selection are no any different from the above. While
conducting the maximizing the utilization of the organization's human capital,
organizations are required to design two measures into the e -enabled selection
system: (1) the "capital" represented by each person who goes through the process
(including the set of text scores, interview ratings, resum6 quality indices,
background check results, drug test results, and any other quantifiable evaluation
of the skills, experiences, abilities.. ..etc.), and (2) "the extent to which the process
results in decisions that maximize the utilization of that capital" (for example, ratio
or difference between average test scores for selected candidates to average test
scores for all candidates, percentage of candidates who satisfy minimum
requirements such as for drug tests or background checks, retention rates, post-
hire, new hire performance management results.. ..etc.,). Organizations also need to
enable sustainability by emphasizing on: clear ownership, funding strategy,
business contribution, user satisfaction, and professional support. As for the
implementation, Kehoe, Dickter, Russell and Sacco reports that more and more
organizations nowadays prefer to acquire a vendor's e -selection system because of
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the appealing features of specialized and flexible system solution products available
on the market.
E-selection; Different Methods, Different Issues
How you feel when you think an application would decide about your
capabilities which are appropriate for a job or not? Believe or not it is the way that
a lot of large organizations would utilize to assess your fitness for a position
(Gueutal and Stone, 2005) instead of traditional approaches.
A sophisticated web-based application which would be executed on the data

collected from the applicants or a kind of electronic interaction among employer
and potential candidates so-called e-interview that could be vocal or video-based
through which try to find the most appropriate job seeker to take the vacancy is e-
Selection. Collected information could range from biological background like
educational level, related jobs possessed before, etc. to psychological testing like
measuring honesty (Hogler et al., 1998).
Before going further it is good to be said there are two different orientations on
companys website: recruiting-oriented which means the web site only publish
information about the vacant positions for perspective applicants and screening-
oriented which means the web site would collect information from applicants to be
used for selection process -also companys may use both- (Cappelli, 2001). So e-
selection could be considered only when there is a set of collected data from
applicants which requires screening-oriented for companys web site.
However as Bodea et al. (2003) indicate deciding about the decoupling point
between e-recruitment and e-selection processes is usually difficult but generally e -
selection would start when the analysis on data or candidate would start somehow
to feed decision making process. Nevertheless, for example in the multiple purposes
e-recruitment process to increase efficiency which Mari and Ili (2012) introduce so
that it consists of (1) attract candidates (2) communicate with candidates (3) assess
KSAOs (4) and Provide feedback to candidates, based on the previous definition
proposed the selection would start on second step since the knowledge about the
applicant would start to form whereas they call it as a pre -selection process during
e-recruitment. Chapman and Webster (2003) divide various stages of recruitment
and selection as (a) advertising positions, (b) receiving applications, (c) initial
screening, (d) and final selection. So according to the first definition selection starts
on third stage whereas according to the second one, initial screening is a pre -
selection process. As a result generally we can say e-selection process is composed
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by two steps as pre-selection and the final selection which would be elaborated
more by focusing on different methods of e -selection.
24.3.5 E-Training
E-training resembles e-learning in many ways especially in terms of the
methods of delivery and technology used, except that it refers to much shorter time
frame of learning which usually is specifically designed to achieve a certain learning
objective or skill. Typical types of e-training are video conferencing and web-based
training. These technologies purport to permit delivery of learning which is new,
better, cheaper, and faster (Bardach, 1997; Taylor, 2002) than traditional
classroom methods. For the purpose of this study, e-training refers to any type of
training provided in organizations via electronic media which include self-paced
learning from Intranet, learning from CD-ROM at work, training provided by
instructors live through Webcast, recorded sessions of past webcast trainings
available to employees and others.
The benefits of e-learning have been widely discussed including cost-effective,

timely content, and access flexibility (Hong, Lai, & Holton, 2003; Lorenzetti, 2005;
Rosenberg, 2001). Bouhnik and Marcus (2006) have specifically stated that e -
learning has four advantages: (1) freedom to decide when each online lesson will be
learned, (2) lack of dependence on the time constraint, (3) freedom to express
thoughts and (4) accessibility to the courses online materials.
Despite all the perceived benefits of e-learning, research indicates that a high
rate of students who commence e- learning courses do not finish them (Dutton &
Perry, 2002). Many are dissatisfied with the e -learning experience. A study by Loh
(2007) on e-learning effectiveness in the manufacturing industry in Malaysia found
that system quality, information quality, and perceived usefulness influenced e-
learning effectiveness positively. Another study by Md. Hashim Nordin (2007) that
investigates the factors contributing to continuance intention and user satisfaction
in e- training has found that information quality and system quality were important
factors leading to increase in usage and user satisfaction of e -learning in workplace.
Higher level of satisfaction was also found to increase the intention to continue
use.
24.3.6 E-Performance Management
E-Performance Management it is very oblivious by its name that Performance

management with the help of electronic systems. And as Performance Management
is the function of HRM, E-Performance Management is one of the functions of E-
HRM. But yet what exactly is this E-Performance Management was a BIG question
to me? And as usual our dearest Google baba gave me very limited an incomplete
info on E-Performance Management. And again I had a much bigger question than
232
earlier as how will I get the informati on on this. This first made me search
what does E-HRM exactly mean? And I found it as-
E-HRM is typically defining as the use of computer systems, interactive
electronic media, and telecommunication networks to carry out the functions of the
human resources management department. E- HRM managers always strive to
provide a seamless integration of all HRM services with a common goal of employee
satisfaction.
This technology-assisted model of HRM is often begun as an efficiency
program, but it soon evolves into a major source of competitive advantage. In
addition, while some human resources management departments utilize a few
virtual HRM applications, others strive to reengineer, automate and integrate nearly
all of their HRM functions.
E- HRM costs lower and improve efficiency by:
Reducing paperwork and streamlining work flow,
Automating redundant HRM tasks,
Empowering employees to embrace a self- service HRM delivery system,
Keeping the company workflow fully informed about all important HR
compliance issues and corporate events,
Speeding up the response time of HRM systems,
Ensuring that more informed decisions are made,
Improving time management, and
Offering a flexible model of HRM that meets the changing needs of an
increasingly diverse and global workforce.
After reading the about E-HRM, E-Performance Management become much
easier to understand. E-Performance Management, a web-based tool, has been
designed to make your performance reviews easier than ever. E-Performance
management places effective performance management where it belongs in the
hands of managers. Performance contracting and appraisal have never been as
easier with E-Performance Management. The goals of the organization are linked to
the balanced scorecard elements giving the organization an overall view of
performance with drill down capability to departments, sub departments and
individuals.
Its very well said that a good performance management system works towards
the improvement of the overall organizational performance by managing the
performances of teams and individuals for ensuring the achievement of the overall
organizational ambitions and goals.
An effective e- performance management system can play a very crucial role in
managing the performance in an organization by:
233
Ensuring that the employees understand the importance of their
contributions to the organizational goals and objectives.
Ensuring each employee understands what is expected from them and
equally ascertaining whether the employees possess the required skills and
support for fulfilling such expectations.
Ensuring proper aligning or linking of objectives and facilitating effective
communication throughout the organization.
Facilitating a cordial and a harmonious relationship between an individual
employee and the manager based on trust and empowerment.
Performance management pra ctices can have a positive influence on the job
satisfaction and employee loyalty by:
Regularly providing open and transparent job feedbacks to the employees.
Establishing a clear linkage between performance and compensation
Providing ample learning and development opportunities by representing the
employees in leadership development programmes, etc.
Evaluating performance and distributing incentives and rewards on a fair
and equated basis.
Establishing clear performance objectives by facilitating an open
communication and a joint dialogue.
Recognizing and rewarding good performance in an organization.
Providing maximum opportunities for career growth.
An effectively implemented e- performance management system can benefit
the organization, managers and employees in several ways as depicted
below:
Organizations Benefits
It improves organizational performance, employee retention and loyalty,
improved productivity, overcoming the barriers to c ommunication, clear
accountabilities, and cost advantages.
Managers Benefits
The managers receive instant feedback on performance with drill down to
individual employee performance. With this there is no need to rewrite performance
contracts each year. Simply you could upload and edit from a previous period and
then, development the needs emanating from performance discussions would be
automatically fed into the individual development plan.
Employees Benefits
Clarifies expectations of the employees, self-assessment opportunities clarifies
the job accountabilities and contributes to improved performance, clearly defines
career paths and promotes job satisfaction.
234
Below is the diagram whi ch gives us an idea about how the E -Performance
management cycle works
I would like to conclude my blog by saying that performance management

serves as an important tool for realizing organizational goals by implementing
competitive HRM strategies. It helps in aligning and integrating the objectives with
the KPIs in an organization both vertically and horizontally across all job categories
and the levels and thus helps in driving all the activities right from the bottom level
towards one single goal.
Employee Performance Management Solution: 360 Appraisals
360 Appraisals, also known as multi -rater feedback or peer appraisals,
can create a comprehensive view of an employees performance. HRsmarts 360
Appraisal Solution allows managers to extend beyond employee peers by gathering
feedback from clients, vendors or others with whom they frequently interact.
HRsmarts 360 Appraisal Solution provides an easy method for gathering critical
data. This strategic tool can help managers:
Gauge employee performance
Managers typically only see a piece of the picture, but what they dont see can
be even more telling. When feedback is gathered from peers or outside contacts, a
persons true value can become more apparent. Perhaps a customer service
manager goes above and beyond every time they receive a call, or vendors receive all
of the information they need on the first inquiry.
Identify leader
360 Appraisals can help managers more effectively pinpoint group leaders.
Peer reviews are a great way to determine who had leadership ability within a group
by helping you identify employees who motivate others, set good examples and can
235
be trusted by peers to do their parttraits that are often overlooked or hard to
identify in team or group settings.
Increase employee awareness
360 appraisals provide insight into competencies and skills held by employees
and can help employees better understand how the behaviours and attitudes they
exhibit impacts those around them. Anonymous feedback also encourages more
open feedback and honesty, particularly when direct peers and managers are
involved and Human Resource Management.
Create and Manage 360 Assessments
This easy-to-use system allows appraisal owners to easily generate
assessments, then quickly edit, view and print the results. Data can be captured in
an employees annual performance assessment with the option to include it in the
overall rating.
HRsmarts 360 Appraisal solution is a core component of the Employee
Performance Management solution; however, it can be purchased as a stand -alone
application. Contact a sales representative for more information.
720 degree appraisal method aims at monitoring, measuring, giving feedback
and encouraging the employees to achieve the goal and for the Organization in
turn. Effective monitoring also includes giving timely feedback, reviewing the
performance according to pre-determined standards and timely recognition of the
accomplishments that motivates the employee to perform better each day.
It is an integrated method of performance appraisal where, the performance of
an employee is evaluated from 360 degrees (Management, Colleagues, Self and also
customers) and timely feedback is given and performance is evaluated again based
on the targets that are set. Hence, 720 degree pe rformance appraisal can be stated
as twice 360 degree performance appraisal: once when the appraisal is done,
feedback is given and the boss gives tips to achieve the goals. Hence, there is a pre
and a post round of feedback.
The need of 720 degree performance appraisals for todays business world:
The main need of 720-degree performance appraisal can be summarized as
follows:
Provide information about the performance ranks. Assist in taking decisions
regarding salary fixation, confirmation, promoti on, transfer and demotion.
Provide timely feedback about the performance, set targets and monitor the
performance based on the targets set.
Helps to check the effectiveness of personnel procedures and practice i.e.
validation.
It is needed to ensure that employees reach organizational standards and
objectives.
236
To discover the work potential and to understand the areas where training is
required to guide the employees to perform their best.
To understand the expectations of the employees and prevent grievances
and in disciplinary activities.
Provide information to diagnose deficiency in the employee regarding skill,
knowledge, determine training, and prescribe the means for employee
growth and information for correcting placement.
Set realistic target, monitor the performance and provide timely feedback to
ensure that the performance is enhanced.
Assessment system should be 360 degrees.
Assessment should be done twice a year.
Different assessments should be tabulated and compared for a given period.
Ensure that the rating instruments are relevant, valid and reliable
Treat employees with sensitivity and respect
Dimensions of 720-Degree Performance Appraisal
All the organizations aim at achieving higher rate of employee satisfaction and
transparency in the working environment. In order to achieve the goals, 720 degree
performance appraisal would be a vital tool as it is used to appraise the
performance of an employee from different dimensions and helps to overcome the
barriers of bias, prejudice and discrimination. The performance is appraised from 5
dimensions and feedback or the appraisal meeting is conducted twice (pre and post
feedback) to ensure the efficient performance of the employee. Including the pre
and the post feedback, that plays a vital role, the 720 Degree performance appraisal
has 7 phases.
Pre Appraisal Feedback: This is the first appraisal step that is done after the
feedback is collected from the different dimensions or people with whom the
employee would interact. In this step, the performance is evaluated, targets are set
and feedback or training is organized to help the employee achieve the target.
Self Appraisal: The employee is given a questionnaire and asked to evaluate
his performance and through this method, the employee gets an opportunity to
express his thoughts and his valuation of strengths, weakness and judge his
performance.
Peers/Colleagues Appraisal : The feedback from the peers or colleagues is
important as it helps to understand the ability of the employee to work as a team,
co-operate, co-ordinate with others and bring out the best.
Customer Appraisal: In order to survive in the current competitive market,
Organizations aim at achieving high customer satisfaction. Customer feedback
helps to analyse the customer point of view and help to improve the person and the
Organization.
237
Sub-Ordinates Appraisal: The feedback of the sub-ordinates is essential to
analyse the organizing skills of the employee and to understand his abilities like
communication and motivating abilities, ability to delegate the work, leadership
qualities and way of handling responsibilities.
Managers/Superiors Appraisal : In this, the performance, responsibilities and
the attitude of the employee is evaluated by the Superiors or Managers.
Post Appraisal Feedback: It is this step that makes the 720-degree
performance appraisal different and better than the 360-degree performance
appraisal method. In this step, the performance is evaluated based on the target set
in the Pre appraisal and feedback is given. Timely feedback and guidance helps to
make the employee improve his performance.
Merits of 720-Degree Performance Appraisal
720 Degree performance appraisal will help in creating a synergetic work
environment and will help to bring out the best of each employee. The other
benefits of the 720 degree performance appraisal are as follows:
It helps in better analysis and improved feedback from different dimensions
Helps to develop a better and co-operative team
Reduces the appraisal barriers like prejudice, bias and discrimination
Customer feedback is valued. Better customer service and satisfaction can
be obtained
Encourages transparency and feeling of treated justly.
Demerits of 720 Degree Performance Appraisals
85% of the appraisers consider that 720 Degree performance appraisal method
is a time consuming process.
10% of the appraisers consider that the monetary requirement is higher for
720 Degree performance appraisal method as appraisal/feedback has to be
done twice.
5% of the appraisers consider that there might be quality problem as all the
7 dimensions of appraisal in 720 Degree performance appraisal method
might not be accurate.
Rating Scales of Performance Appraisal Form
We can use scales as follows for this performance appraisal form.
Unsatisfactory: Major improvements needed.
Needs Improvement: Less than Satisfactory could be doing better.
Meets Expectations: Performing duties as directed with minimal Supervision.
Excellent: Performing all duties in a cost- effective manner with positive,
measurable results.
238
Outstanding: Performing at a level above and beyond the duties of the current
positions requirements.
Why companies should use 720?
This system is more development focused than performance al one, and
supplements training and development functions in a better way. A powerful
developmental tool because when conducted at regular intervals it helps to keep a
track of the changes, others perceptions about the employees. Many organizations
are beginning to realize that the skill base of their executives and managers does
not match the requirements of a rapidly changing environment. Without these
critical competencies, executives and managers are less likely to be able to lead
these organizations toward successful implementation of strategic changes.
E-Compensation
Dulebohn and Marler (2005) reports that the decline in lifelong employment
relationships and internal labor market, added with the switch to the flatter
organizational structures since 1990s has increased the prominence of competitive
compensation in attracting and motivating critical human capital in the US. This
further necessitates a "closer linkage with the external market and the tools to
make rapid changes in compensation in order to remain competitive and attractive
to current incumbents and prospective employees". E-Compensation represents a
web-enabled approach to an array of compensation tools that enable an
organization to "gather, store, manipulate, analyze, utilize, and distribu te
compensation data and information" (Dulebohn & Marler, 2005). Unlike previous
compensation software, the e-compensation tools is web-based, rather than client-
server based or stand-alone PC-based. This allows individual's access electronically
distributed compensation software, databases, and analytic tools by using an
internet browser from literally anywhere on the earth.
E-Compensation tools can provide HR managers with the ability to effectively
adapt compensation systems to meet the current challenge s, manage and maintain
all aspects of equity in pay plan design, and to align the compensation systems
with the strategic management of the organization. Dulebohn and Marler (2005)
names three key ways in which e-Compensation tools help the HRM professionals
in dynamic and competitive environment: (1) increase access to critical
compensation information (for example: knowledge management databases, best
practices internal and external, individual equity design, competitive information)
by simply on an as-needed basis without dedicated IT staffs and sophisticated IT
infrastructures, (2) enable round-the-clock availability of meaningful compensation
information to managers and employees company-wide, thus making critical
compensation information more available to support decision making, (3)
streamline cumbersome bureaucratic tasks through the introduction of workflow
functionality and real-time information processing, so the HRM professionals'
productivity can be increased.
239
E-compensation systems also allow managers to develop budgets, model the
impact of incentive systems, and ensure the fairness of salary allocation decisions
(Dulebohn &Marler, 2005; Stone et al., 2003). For instance, such systems give
managers access to salary data that can be used for budge ting and modelling the
costs of incentive systems with different components (e.g, profit sharing, merit
increases, stock options). Furthermore, these systems can be linked to e-
performance management systems, increasing the odds that pay raises are based
on employee performance. Moreover, they can be used to ensure that compensation
systems have internal and external equity (Dulebohn & Marler, 2005). Interestingly,
research shows that high performing companies are more likely to share details
about their compensation systems with employees than low performing companies
(Gherson & Jackson, 2001). In addition, research reveals that individuals have
higher satisfaction and retention levels when pay systems are perceived as fair
(Bergmann & Scarpello, 2002).
1. E-HRM
It is the use of web-based technologies to provide HRM services within
employing organizations. It embraces E-recruitment and E-learning, the first
fields of human resource management to make extensive use of web-based
technology. From this base E-HRM has expanded to embrace the delivery of
virtually all hr policies.
2. E-Selection
There are three purposes for all the HR E- Enablement: (1) to minimize cost,
(2) to maximize the utilization of the organization's human capital, (3) to
enable sustainability which refers to the organization's willingness and
ability "not only to maintain the E-enabled system, but to progressively
evolve the system to satisfy changing requirements, and capitalize on
improvements in technology and the science of selection.
3. 720 degree performance appraisal
It would be a vital tool as it is used to appraise the performance of an
employee from different dimensions and helps to overcome the barriers of
bias, prejudice and discrimination. The performance is appraised from 5
dimensions and feedback or the appraisal meeting is conducted twice (pre
and post feedback) to ensure the efficient performance of the employee.
Including the pre and the post feedback, that plays a vital role, the 720
Degree performance appraisal has 7 phases.
1. Explain the benefits of e-performance management system.
2. Describe HR Outsourcing.
3. Write short note on: a) e-recruitment b) e-selection c) e-performance
management d) e-compensation f) e-training
240
4. Explain the difference methods in e-selection.
5. Explain the term e-HRM. What are the major goals of e-HRM?
6. Describe the four integrated goals of e-HRM
7. What are major function of e-HRM
8. Explain the significance of the first, second, and third generations of e -HRM
9. Distinguish between second and third generations of e -HRM practices
10. Explain the extent to which planned use of web-tools for HRM functions
enable organizations by using information collected through the Internet.
24.6 SUMMARY
Technology and innovation are increasingly becoming critical for success of
organization. The benefits of it extend far beyond productivity; the emergence of
tools based on the new information and communication technologies (ICTs) also
affects the working methods of business. As a c onsequence, numerous changes are
taking place within the organization context. The above lesson discusses the basics
of e-HRM and highlights its benefits. E-HRM involves use of web-based
technologies to manage people, perform HR functions (e.g. E-recruitment, e-
selection etc.,) and deliver e-services to employees. The view of e-HRM outlined in
this lesson provides a foundation for understanding the needs and importance of e -
HRM in the present era.
1. E-learning has reached a high level of technical sophistication, in terms of
effective management and
Performance appraisal
Faster communication
Instructional development
Electronic performance monitoring
2. Applicants enjoys the luxury of accessing jobs online at their own
convenience through
Online recruitment
E-HRM
A visit to a company
E-coaching
3. Basic components of e-HRM and traditional HRM are relatively:
Different
Uncorrelated
Similar
None of these
241
4. Monitoring employees in the workplace using technologically mediated
system refers to
E-recruitment
Electronic performance monitoring
HRM
MBO
24.9 ASSIGNMENTS
1. Working individually or in groups, compare the features of e-HR practices of
2-3 organization by using information collected through the Internet.
Analyse to what extent web-based HR practices help organizations to achieve
competitive advantage.
1. Bondarouk, T.V. and Ruel, H.J.M. 2009, Electronic HRM: Challenges in the
digital era, The International Journal of HRM, 20(3), pp.505-14.
2. Carmeli, A., & Josman, Z. E. (2006). The Relationship among Emotional
Intelligence, Task Performance, and Organizational Citizenship Behaviors,
Human Performance, 19 (4), 403-419.
3. Carson, K. P., Cardy, R. L., & Dobbins, G. H. (1991). Performance Appraisal
as Effective Management or Deadly Management Disease, Group
Organization Management, 16(2), 143-159.
4. Castka, P., Bamber, C. J., Sharp, J. M., & Belohoubek, P. (2001). Factors
affecting successful implementation of high performance teams, Team
Performance Management, 7(7/8), 123 134.
5. Cawley, B. D., Keeping, L. M., & Levy, P. E. (1998). Participation in the
performance appraisal process and employee reactions: A meta-analytic
review of field investigations, Journal of Applied Psychology, 83(4), 615 -633.
6. Chander, S. and Singh J. (2004), Performance of Mutual Funds in India An
Empirical Evidence, The ICFAI Journal of Applied Finance, June, pp.45-63.
7. Cleveland, J. N., Murphy, K. R., Williams, R. E. (1989). Multiple uses of
performance appraisal: Prevalence and correlates, Journal of Applied
Psychology, 74 (1), 130-135.
8. Cox, T., & Nkomo, S. M. (1986). Differential Performance Appraisal Criteria:
A Field Study of Black and White Managers, Group Organization
Management, 11 (1-2), 101-119.
242
9. Delay and distortion: Tacit influences on performance appraisal
effectiveness, Journal of Applied Psychology, 73 (3), 507-514.
10. Ruel, H. Bondarouk, T., and Looise, J.2004, E-HRM innovation or irritation:
An explorative empirical study in five large companies on web-based HRM;
Management Review, 15, pp.364-80.
11. Sivaprakasam-`, P. (1993) An Appraisal of Personnel Management Policies
and Practices in Central Co-operative Banks in Tamil Nadu, Indian Co-
operative Review, Vol. XXXI, No.1, pp.1-11, NCUI, New Delhi.
12. Strohmeier, S. 2007, Research in e-HRM: Review and implication. Human
Resource Management Review, 17, pp.19-37.
13. Waldman, D. A. (1997). Predictors of Employee Preferences for Multi -rater
and Group-Based Performance Appraisal, Group Organization Management,
22 (2), 264-287.
14. Wall, T. D., Cordery, J. L., & Clegg, C. W. (2002). Empowerment,
Performance, and Operational Uncertainty: A Theoretical Integration,
Applied Psychology 51 (1), 146169.
1. Visit to an E-Recruitment centre of a consultancy firm and try to understand
the nuances of recruitment, selection process. Interact with the man
responsible for heading the organization and see how the real process of
recruitment and selection takes place through virtual mode.
24.12 KEYWORDS
Competency management, employee self-service, E-coaching, E-HRM, E-
Learning, E-recruitment, E-training, Generations of e-HRM.

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M.B.A. Human Resource Management

HUMAN RESOURCE MANAGEMENT

HUMAN RESOURCE MANAGEMENT

Dr. C. Samudhararajkumar Dr. A. Rajamohan

Dr. R. Jayabal Dr. B. Rajasekaran

HUMAN RESOURCE MANAGEMENT

M.B.A. HUMAN RESOURCE MANAGEMENT

HUMAN RESOURCE MANAGEMENT

2.8 SUPPLEMENTARY MATERIALS

8.8 SUPPLEMENTARY MATERIALS

Job Analysis Process

Mental processes- what reasoning, planning, organizing, and decision 14

Product, marketing and financial strategy planning.

13.3.2 Features of HRD

Need and Significance of Human Resource Development (HRD)

A. On-the-job Training Methods B. Off-the-Job Training Methods

15.3.5 Methods of Evaluation

1. Analysis of Organizational Present and development Needs

16.4 REVISION POINTS

To increase the effectiveness of the organization.

To increase versatility and competence of key

To deal with fluctuations in work requirements.

To correct incompatibilities in employee relations.

To correct erroneous placement.

20.3.5 Types of Fringe Benefits

20.3.5 Problems in Performance Appraisal

22.3.2 Past Oriented /Traditional Methods Performance Appraisal

A sophisticated web-based application which would be executed on the data

The benefits of e-learning have been widely discussed including cost-effective,

24.3.6 E-Performance Management

E-Performance Management it is very oblivious by its name that Performance

I would like to conclude my blog by saying that performance management

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