HUMAN

RESOURCE
MANAGEMENT

Nature and Concept of Human Resource

Management

Bernardo, Camille Grace H.

BSOALT III-1

December 10, 2018

Unit I: Nature and Concept of Human Resource Management

Introduction

During the first four hundred years of industrialization, it was all about machines, which
gradually replaced the human labor. They were so important that humans were not even
considered resource. With information revolution, Internet connectivity and the greatest
resource; that makes human resource management, by far, the most important stream of the
art of managing business.

In this chapter/unit, we will know the meaning of Human Resource Management and what was
the Human Resource means. Also we will know the aims or purposes of Human Resource
Management and its phases or aspects. We will also discuss about the evolution of Human
Resource Management, the nature and concept of people and organization and lastly, the role
of Human Resource Management in the organization.

Nature of Human Resource Management

Human resource management is a management function that helps managers to recruit, select,
train and develop members for an organization. Human resource management is concerned
with people’s dimension in organizations. The following aspects constitute the core of Human
resource management:

1. Human resource management involves the Application of Management Functions and

Principles. The functions and principles are applied for 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.

4. Human resource management Functions are not confined to Business Establishments Only
but applicable to non-business organizations such as education, health care, recreation and
like.

a) Definition of Human Resource and Human Resource Management

Human resources is used to describe both the people who work for a company or organization
and the department responsible for managing resources related to employees. The
term human resources was first coined in the 1960s when the value of labor relations began to
garner attention and when notions such as motivation, organizational behavior, and selection
assessments began to take shape. It is the set of individuals who make up the workforce of an
organization business sector, or economy. Other terms sometimes used include “manpower”,
“talent”, “labour”, or simply “people”. (HumanResourcesEdu, www.humanresourcesedu.org)
Human Resources Management by Foreign and Filipino authors, academicians and
management practitioners, shows more common elements than disparate concepts: Human
resources management is the art and science of acquiring, motivating and developing people in
their jobs in light of their personal, professional and technical knowledge, skills, potentialities,
needs and values and in synchronization with the organization philosophy, resources and
culture for the maximum achievement of individual, organization and society’s goals. The
process implies the five functions of management which are planning, organizing, staffing
directing and controlling. Human resources management deals only with people so that they
can manage the other resources within their domain of responsibility efficiently and
effectively.

Sison points out aptly the nature of human resources management in his book when he says:
The major tool of the personnel manager as scientist and artist is his creative imagination and
intelligence developed by practice, learning and experience, his intuition and insight in
handling the various problems or employees and unions in such a way that there is order,
harmony, balance and proper timing. He also knows how to simplify complex problems. The
interplay of motivations and emotions in handling problems involving employees is “played by
ear”.

Human resources management, therefore, is a science drawing from the theories and
principles of management and other disciplines. It is also an art, being a highly individual
process eliciting human behavior skills. A combination of the cognitive and affective aspects of
management makes human resources management efficient and effective.

According to HumanResourcesEdu, Human resource management is a contemporary, umbrella

term used to describe the management and development of employees in an organization. Also
called personnel or talent management (although these terms are a bit antiquated), human
resource management involves overseeing all things related to managing an organization’s
human capital. Human resource management is therefore focused on a number of major areas,
including: recruiting and staffing, compensation and benefits, training and learning, labor and
employee relations, and organization development.
b) Aims or Purposes of Human resource management
According to Tanzania Public Service College (TPSC), Nature and scope of Human resource
management by Willy Madinda, 2012, these are aims/objectives of human resource
management:
 To help the organization reach its goals.
 To ensure effective utilization and maximum development of human resources.
 To ensure respect for human beings. To identify and satisfy the needs of individuals.
 To ensure reconciliation of individual goals with those of the organization.
 To achieve and maintain high morale among employees.
 To provide the organization with well-trained and well-motivated employees.
  To increase to the fullest the employee’s job satisfaction and self-actualization.
 To develop and maintain a quality of work life.
 To be ethically and socially responsive to the needs of society.
 To develop overall personality of each employee in its multidimensional aspect.
 To enhance employee’s capabilities to perform the present job.
 To equip the employees with precision and clarity in transaction of business.
 To inculcate the sense of team spirit, team work and inter-team collaboration.
But according to Human Resource and Personnel Management, Text & Cases, by Aswathappa
K., the primary objective of human resource management is to ensure the availability of
competent and willing workforce for an organization. Beyond this, there are other objectives
too. Specifically, HRM objectives are four fold: Societal, Organization, Functional and personal.

• Personal Objectives: To assist Employees in achieving their personal goals, at least in so far as
these goals enhance the individual’s contribution to the organization. Personal objectives of
employees must be maintained, retained and motivated.

• Functional Objectives: To maintain the contribution of department at an appropriate level

organization should fulfill the needs. Resources are wasted when HRM is either more or less
sophisticated to suit the organizations demands.

• Organizational Objectives: To recognize the role of HRM in bringing about organizational

effectiveness, HRM is not an end in itself but it is only a mean to assist the organization with its
primary objectives organization.

• Societal Objectives: To be ethically & socially responsible for the needs and challenges of society
while minimizing the negative impact of such demands upon the organization to use their resources
for society’s benefits in ethical ways may lead to restriction.

• Other objectives:

 Accomplish the basic organizational goals by creating and utilizing an able and motivated
workforce.
  To establish and maintain organizational structure and desirable working relationships
among all the members of the organization.
 Develop co-ordination among individual and group within organization to secure the
integration of organization.
 To create facilities and opportunities for individual or group development so as to match it
with the growth of the organization.
 To attain an effective utilization of human resources in the achievement of organizational
goals.
 To identify and satisfy individual and group needs by providing adequate and equitable
wages, incentives, employee benefits and social security and measures for challenging
work, prestige, recognition, security, status.
 To maintain high employees morale and human relations by sustaining and improving the
various conditions and facilities.
 To strengthen and appreciate the human assets continuously by providing training and
development programs.
 To consider and contribute to the minimization of socio-economic evils such as
unemployment, under employment, inequalities in the distribution of income and wealth
and to improve the welfare of the society by providing employment opportunities to
women and disadvantaged sections of the society.
 To provide an opportunity for expression and voice management.
 To provide fair, acceptable and efficient leadership.
 To provide facilities and conditions of work and creation of favorable atmosphere for
maintaining stability of employment.
 To create & utilize an able & motivated work force Establish & maintain sound
organizational structure Create facilities attain an effective utilization Identify & satisfy
individual & group needs.
 Maintain high employee morale Training & development Opportunity for expression
Provide fair, acceptable and efficient leadership Facilities and conditions.

c) The different phases or aspects of Human resource management

Human Resource Management refers to the process of recruiting, selecting, hiring, training, and
developing the skills of the employees. HR team is the most valuable asset of any firm as it directly
deals with the employee and ensures that they are productive. Therefore, companies hunt for HR
professionals who have pertinent skills to perform all the employees-related tasks from hiring to
retirement efficiently. In such a scenario, HR management course can boost your skills and uplift
your market value so that you are easily picked up by top companies.

It’s the task of the human resource managers to implement the laws of employment within an
organization, to train the employees to abide by the rules and to perform their job efficaciously.
The HR managers decide pay grades, rewards, and remuneration of each employee. They even
settle work-related disputes.
 According to MIT-School of Distance Education, generally, there are three phases of Human
Resource Management namely, the pre-hiring phase of the employee, Training and Development
phase and the post-hiring phase of the employee.

1. Phase of Pre-hiring of the employee

HR managers are bestowed with the responsibility to recruit right employees to fill in the vacant
positions in the organization. Under this phase, they prepare job advertisements to invite eligible
candidates for the interview. They also decide venues that can be used for promoting open
positions. The HR professionals may visit college placement cells, attend job fairs, or participate in
recruiting events to shortlist the suitable candidates.

2. Training and Development Phase of the Employee

After hiring the candidates, the human resource managers conduct an orientation program where
candidates are given comprehensive information about their job, company and the work
environment. The candidates are made acquainted with the work-culture and introduced to all the
team members including the managers and executives. The candidates are then vigorously trained,
educated and their skills are developed with respect to the positions that they’ll hold. They go
through different pieces of training such as induction training, job training, safety training and many
more. The candidates are accustomed to the tools, machines and safety norms that have to follow.
They are also informed of the salary package, policies, perks, leaves and other work-related facts.

3. Post-Hiring Phase of the Employee

After the employees are hired, it is very common that the disputes may arise between the workers
/ employees working in the organization or between workers/employees and managers. Hence,
the human resource managers perform the task of settling such disputes. Furthermore, the
employment laws change recurrently so the human resource managers act as the consultants for
the employees. They notify the employees regarding any change in the laws. They even take care of
their remuneration, workplace and other factors.

d) The evolution of HRM

Evolution and developments of HRM

The history of development of HR management in India is comparatively of recent origin. But

Kautilya had dealt with some of the important aspects of human resources management in his
“Arthasastra,” written in 400 B.C. Government in those days adapted the techniques of HRM as
suggested by Kautilya. In its modem sense, it has developed only since independence. Though the
importance of labour officers was recognized as early as 1929, the appointment of officers to solve
labour and welfare problems gained momentum only after the enactment of the Factories Act of
1948. Section 49 of the Act required the appointment of Welfare Officers in companies employing
more than 500 workers. At the beginning, Government was concerned only with limited aspects of
labour welfare. The earliest labour legislation in India dealt with certain aspects of Indian labourers
(Regulation of Recruitment, Forwarding and Employment) sent to various British colonies in 1830.

Important phases of evolution of HRM are presented in Exhibit:

Evolution and Developments of HRM in India

But according to Unit 1, HRM concepts by Priya Krishnani, these is the evolution of HRM:

e) The Nature and Concept of people and organization

a. Definition of organization
Organization refers to the structure reated as a result of the grouping of
functioning segments like departments, divisions, sections and units that work into
a harmonious relationship so that all the different processes within the system can
operate efficiently and effectively.
Muro states “Organizing the personnel invlves the structuring and the staffing of
the enterprise.” He further adds that, “…the grouping and the functional
 relationship is sometimes referred to as the internal structure. It is graphically
represented by the organization chart.”
In general, organizations set up the following departments: administration,
production (business setting) or operations (government agencies), marketing
(business setting), finance, human resources, services, public relations,legal,
corporate affairs and reearch and development. In some organizations, the Human
Resource Department is subsumed in another department or it may be a separate
department by itself. Formation or establishment of a separate Human Resource
Department, more often than not is determined by the size of organizational
population, philosophy of management organizational emphasis and financial
resources.
Also, organizations are in a constant state of flux arising from internal and external
changes. It is difficult if not impossible, to structure and ideal organization
considering that it is not static.
b. Characteistics of an organization
For companies to achieve long-term success, they must create and maintain
healthy environments in the workplace. Healthy organizations understand that it
takes a collaborative effort to compete in their market segment and produce
continuous profits. Healthy organizations have certain characteristics ingrained in
their corporate culture. Recognizing and understanding the characteristics of
healthy organizations can help you detect problems in your company if it is
unprofitable and take corrective steps to operate a successful business.

According to Katie Brunelle, 2004, these are the characteristics of a healthy

organization:
 Effective Sharing of Goals
 Great Teamwork
 High Employee Morale
 Offers Training Opportunities
 Strong Leadership
 Handles Poor Performance
 Understands Risks
 Adapts to Opportunities and Changes
 Clearly Defined Structure
 Well-Known Company Policies
c. Natiure and characteristics of people

f) Role of HRM
The role of HRM is to plan, develop and administer policies and programs designed to make
optimum use of an organizations human resources. It is that part of management which is
concerned with the people at work and with their relationship within enterprises.

Current Classification of HR roles:

According to R.L Mathis and J. H. Jackson (2010) several roles can be fulfilled by HR management.
The nature and extent of these roles depend on both what upper management wants HR
management to do and what competencies the HR staff have demonstrated. Three roles are
typically identified for HR.

• Administrative • Operational Actions • Strategic HR

1. Administrative Role of HR:

The administrative role of HR management has been heavily oriented to administration and
recordkeeping including essential legal paperwork and policy implementation. Major changes have
happened in the administrative role of HR during the recent years. Two major shifts driving the
transformation of the administrative role are: Greater use of technology and Outsourcing.

Technology has been widely used to improve the administrative efficiency ofHR and the
responsiveness of HR to employees and managers. Moreover; HR functions are becoming available
electronically or are being done on the Internet using Web-based technology. Technology is being
used in most HR activities, from employment applications and employee benefits enrollments to e-
leaming using Internet-based resources.

2. Operational and Employee Advocate Role for HR:

HR managers manage most HR activities in line with the strategies and operations that have been
identified by management and serves as employee “champion” for employee issues and concerns.
HR often has been viewed as the “employee advocate” in organizations. They act as the voice for
employee concerns, and spend considerable time on HR “crisis management,” dealing with
employee problems that are both work-related and non work-related. Employee advocacy helps to
ensure fair and equitable treatment for employees regardless ofpersonal background or
circumstances.

Sometimes the HR’s advocate role may create conflict with operating managers. However, without
the HR advocate role, employers could face even more lawsuits and regulatory complaints than
they do now.

The operational role requires HR professionals to co-operate with various departmental and
operating managers and supervisors in order to identify and implement needed programs and
policies in the organization. Operational activities are tactical in nature. Compliance with equal
employment opportunity and other laws are ensured, employment applications are processed,
current openings are filled through interviews, supervisors are trained, safety problems are
resolved and wage and benefit questions are answered. For carrying out these activities HR
manager matches HR activities with the strategies of the organization.

3. Strategic Role for HR:

The administrative role traditionally has been the dominant role for HR. A broader transformation
in HR is needed so that significantly less HR time and fewer HR staffs are used just for clerical work.

Differences between the operational and strategic roles exist in a number of HR areas. The strategic
HR role means that HR professionals are proactive in addressing business realities and focusing on
fiiture business needs, such as strategic planning, compensation strategies, the performance of HR
and measuring its results. However, in some organizations, HR often does not play a key role in
formulating the strategies for the organization as a whole; instead it merely carries them out
through HR activities.

Many executives, managers, and HR professionals are increasingly seeing the need for HR
management to become a greater strategic contributor to the business success of organizations. HR
should be responsible for knowing what the true cost of human capital is for an employer.

For example, it may cost two times key employees’ annual salaries to replace them if they leave.
Turnover can be controlled though HR activities, and if it is successful in saving the company money
with good retention and talent management strategies, those may be important contributions to
the bottom line of organizational performance.

The role ofHR as a strategic business partner is often described as “having a seat at the table,” and
contributing to the strategic directions and success of the organization. That means HR is involved
in devising strategy in addition of implementing strategy. Part of HR’s contribution is to have
financial expertise and to produce financial results, not just to boost employee morale or
administrative efficiencies. Therefore, a significant concern for chieffinancial officers (CFOs) is
whether HR executives are equipped to help them to plan and meet financial requirements.

The role of HR shifted from a facilitator to a functional peer with competencies in other functions
and is acknowledged as an equal partner by others. The HR is motivated to contribute to
organizational objectives of profitability and customer satisfaction and is seen as a vehicle for
realization of quality development. The department has a responsibility for monitoring employee
satisfaction, since it is seen as substitute to customer satisfaction.

According to McKinsey’s 7-S framework model HR plays the role of a catalyst for the organization.
According to this framework, effective organizational change is a complex relationship between
seven S’s.

HRM is a total matching process between the three Hard ‘S (Strategy, Structure and Systems) and
the four Soft 'S (Style, Staff, Skills and Super-ordinate Goals). Clearly, all the S’s have to complement
each other and have to be aligned towards a single corporate vision for the organization to be
effective. It has to be realized that most of the S’s are determined directly or indirectly by the way
Human Resources are managed and therefore, HRM must be a part ofthe total business strategy.
Online References

Characteristics of a Healthy Organization; Katie Brunelle; 2004. Retrieved on December 7,

2018 https://smallbusiness.chron.com/top-10-characteristics-healthy-organization-
20452.html

C.S. Venkataratnam and B.K. Srivastava, Personnel Management and Human Resources, TATA
Mc-Graw Hill, New Delhi, 1991, p.5. Retrieved on December 7, 2018
http://shodhganga.inflibnet.ac.in/bitstream/10603/76404/10/10_chapter%201.pdf

Human Resource and Personnel Management, Text & Cases, by Aswathappa K., Tata Me Graw-
Hill Publishing Company Ltd., P.8. Retrieved on December 7, 2018
http://shodhganga.inflibnet.ac.in/bitstream/10603/76404/10/10_chapter%201.pdf

Human Resource Management, Geet S.D., Deshpande A.D. & Mrs. Deshpande Asmita A.,
NIRALIPRAKASHAN, First Edition, Jan. 2009, P.24. Retrieved on December 7, 2018
http://shodhganga.inflibnet.ac.in/bitstream/10603/76404/10/10_chapter%201.pdf

HumanResourcesEdu. What is Human Resource? Retrieved on December 7, 2018

https://www.humanresourcesedu.org/what-is-human-resources/

Mathis R. L. & Jackson J. H. {2010}: Human Resource Management Thompson / South Western.
Retrieved on December 7, 2018
http://shodhganga.inflibnet.ac.in/bitstream/10603/76404/10/10_chapter%201.pdf

MIT: School of Distance Education, Three Important Phases of Human Resource Management.
Retrieved on December 7, 2018 https://www.mitsde.com/Blog/three-important-
phases-of-human-resource-management/

Priya Krishnani: Unit 1, HRM Concepts. Retrieved on December 7, 2018

https://www.slideshare.net/Priyakrishnani/unit-1-hrm-
concepts?fbclid=IwAR0OHRG3gs8abc00J3QGwag_3rYn0QpM3pZGAdpX3wAx3uvlJLxA
eQuXnL8

Willy Madinda: Tanzania Public Service College, Nature and Scope of Human Resource
Management. Retrieved on December 7, 2018
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Book Reference

Concepcion Rodil Martires (1991): Human Resources Management Principle and Practices
Revised Edition, P. 3-9.