MGT 340

CHAPTER

1 1

Azira Rahim (Faculty Business & Management)

 Learning Objective

After completing this chapter, students should be able to:

 Define Human Resource Management

 Identify the importance/challenges of human resource management
 Identify and explain the impact of current social, business and economic
changes on human resource management
 Describe the structure of the human resource function in organizations
 Explain the functions within the scope of human resource management

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 CHAPTER 1
3

Azira Rahim (Faculty Business & Management)

 DEFINITION OF
HUMAN RESOURCE MANAGEMENT

Human resource management is the development and

implementation of systems in an organization for attract,
develop and retain a high-performing workforce.

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 IMPORTANCE OF HRM
5

• Accommodating Employees’ Needs-Flexible hours,

child-care centre and fringe benefits
• Increase Complexity of a Manager’s Job-HR assist in
Recruiting, Selection, Performance Appraisal, Training
• Increasing Legal Complexity-Employment Act,
EPF,SOCSO, OSHA
• Human Resource Information System-Computerized
systems in HR decisions
• Cost of Human Resource-High cost of turnover,
absenteeism, sabotage

Azira Rahim (Faculty Business & Management)

 CHALLENGES/CHANGES OF HRM
 Technological changes
- Employees need to upgrade and develop their skills and knowledge.
- It is the job of HR department to provide training to employees.

 Globalization and increased competition

- Products and services may be produced in any country considered by the
company concerned, labor is not so mobile.
- Open businesses in other countries and wish to employ their own
nationals in the key positions to look after their interest.

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 Cont.
7
 Employee education and expectations
- People are staying longer at school and more students are pursuing
tertiary education.
- Higher level of education, workers are becoming more aware about
their employment rights.

 Workforce diversity
- Employees at workplace consists of different age groups that will going
to have different expectation.
- Therefore, company has to meet these different generations’ needs.
- Ex: Generation X, Y and baby boomers.

Azira Rahim (Faculty Business & Management)

 The Structure of HRM
8

 Big/ Large Organization

- In large organizations, the human resource function

becomes complex for a HR manager to handle.
Therefore, separate sections are created and there
would be one manager who is in charge of all the
human resource functions separately.

Azira Rahim (Faculty Business & Management)

 Example Of HR Structure of a Large Organization

Chief Executive Officer

PA to CEO

General Manager

PA to GMHR

Manager Manager Manager Manager Manager Manager

Manpower Planning C&B T&D Payroll IR Administration

Executive Executive Executive Executive Executive Executive

HR Clerk HR Assistant HR Assistant Payroll Assistant IR Assistant Admin Asistant

Office Boy
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 The Structure of HRM
10

 Small Organization

- Small businesses seldom have a formal human resource

unit and human resource management specialists. In small
firms, the human resource functions are carried out by
other managers in the company such as sales, finance and
administrative managers and their activities are focused on
hiring and retaining capable employees. In small firms, if a
manager made a staffing mistake, such as hiring
incompetent employees, customers may get turn off and
this would cause the firm to fail.

Azira Rahim (Faculty Business & Management)

 EXAMPLE OF HR STRUCTURE OF A SMALL
BUSINESS

Manager/
Owner

Sales Operations Finance

Azira Rahim (Faculty Business & Management) 11

 FUNCTIONS OF HRM
12

Employment

Training and
Industrial Development
relation

Productivity
Payment and
improvement
reward system
scheme

Employee
Health and
service/
safety
welfare

Azira Rahim (Faculty Business & Management)

 Employment

• Human resource planning

• Setting policies and administering disciplinary action systems
• Recruitment

• Developing career movement policies such as transfers and

promotion
• Terminating employees
• Liaison with Immigration and Labour Department
• Records keeping

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 Training and Development

 Implementing induction activities

 Organizing skills training
 Organizing supervisory and management development
programmes
 Developing and managing performance management and
appraisal systems

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 Payment/Reward Systems

 Establishing a wage structure

 Developing information for payroll

 Establishing incentive schemes

 Advising on benefits

HRM Principles & Practices

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Azira © Oxford University Press Malaysia, 2008
 Safety and Health

 Organizing safety activities

 Developing wellness activities
 Investigate accident
 Provision of health services
 Developing sexual harassment and violence
programme

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 Employee Services/Welfare

 Supervise canteen facilities

 Provision of transport
 Provision of recreation facilities
 Counselling

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 Productivity Improvement Schemes

 Developing quality programme such as ISO

programmes.
 Developing suggestion schemes, team problem
solving activities and Kaizen tools

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 Industrial Relations

 Grievance handling
 Relations with trade union representatives
 Collective bargaining negotiations
 Preparing for possibilities such as strike
action

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 SUMMARY
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 Human resource management is very important in

the organization. Without employees, the
organization will not increase performance and
productivity. Thus, it is very important to develop
and retain a high-performing employees in the
organization.

Azira Rahim (Faculty Business & Management)

 REFERENCE
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Maimunah Aminuddin (2008).Human Resource Management:

Principles and Practices. 3rd edition. Oxford University : Press
Malaysia.
Azira Rahim (Faculty Business & Management)