Everything you need to know about the Human Resource Management, it’s definition, objectives, importance and scope.

Human resource management can be defined as a strategic and coherent approach to the management of the most valued assets of an organization, i.e., people, who individually and collectively contribute to the organizational objectives.

Learn about: 1. History of Human Resource Management 2. Meaning of Human Resource Management 3. Roots 4. Objectives 5. Components 6. How HRM and SHRM Could Help Firms?

7. HRM in the New Millennium 8. Features of Human Resource Management 9. Importance 10. Functions 11. Model 12. HR Challenges in the 21st Century.

Human Resource Management: Definition, Objectives, Importance, Functions, Process and Scope

Human Resource Management – History

It was Peter and Waterman’s (1982) publication of ‘In Search of Excellence’ that rediscovered the importance of the human side of enterprise. In this was the discovery of competitive advantage through “excellence syndrome”, or the idea that personnel policy must be linked to strategy and people are an asset.


These concepts combined tight controls on results with autonomy in priorities, decisions and actions. These propositions were academically developed by Harvard University in its MBA program by Beer and others in 1985 and Michigan University by Fombrun and others in 1984.

The ideas have been critically reworked since the late 1980s by Guest and Storey and Sisson.

The concept of normative HRM has been adopted by many organisations and has two common themes:


i. HR policies should be integrated with strategic business planning and used to reinforce or change an appropriate organisational culture.

ii. Human resources are valuable and a source of competitive advantage and are tapped most effectively through policies that promote commitment.

Traditionally, Personnel/HRM used to handle four simple activities, namely-

Staffing, management of change, administrative activities and performance-related work. Staffing ensured that the right staff are available at the right time and in the right place. This involved identifying the nature of the job and implementing a recruitment and selection process to ensure a correct match. To retain the people selected, the organisation came out with developmental initiatives and a reward package.


To motivate the people selected, a performance appraisal system was also put in place. To put the disengaged worker to task, motivational practices were also instituted. Organisational rules, regulations, policies and procedures followed to keep the firm moving. Administrative mechanisms were also put in place to see that talent does not disappear without notice.

As you can see, personnel management was thus more or less workforce centered and more operational in its focus. Personnel managers used to recruit, select and carry out administrative procedures as laid down by Line Managers.

They acted as a bridge between the employer and the employee. There was a functional bias and no strategic orientation. They had to understand the needs of line managers and the employees and articulate those needs to both parties from time to time.

This was the time when Guest came out with his model of HRM, diverting attention to the individual needs of workers, the strategic management of an organisation by aligning the needs of employees with those of the organisation. How HR could be used to hire talent in order to show superior performance and commitment rather than simply meet the requirements of system — that is mere compliance.


How HR could be used to achieve key business goals alongside developing employee capabilities, assuming the role of a strategic partner. Storey also felt that human capability and commitment differentiated one organisation from another.

To achieve goals, involvement of HR at the highest level and the alignment of human resource systems, processes and procedures with corporate goals was also being emphasised. Within the HRM view, two approaches have been identified. Storey (1989) labeled these two approaches as hard HRM and soft HRM.

The ‘hard’ approach, rooted in manpower planning is concerned with aligning human resource strategy with business strategy, while the ‘soft’ approach rooted in the human relations school, has concern for workers’ outcomes and encourages commitment to the organisation by focusing on workers’ concerns. Some authors have suggested that there are inherent contradictions within this normative theory of HRM.

Human Resource Management Definitions

Management has been defined as control and creation of a technological and human environment that can support optimal utilization of resources and competencies for achieving organiz­ational goals. Management has also been variously defined as development of people; the process of decision-making and control over actions of human beings; planning, organizing, and controlling of people and resources; the process of accomplishing the desired organiz­ational objectives; effective utilization of available resources for delivery of services and goods, etc.


It is in this backdrop that we will try to understand the broad definitions of human resource management given by various experts.

Process consisting of four functions—acquisition, development, motivation and maintenance of human resources – David A. Decenzo and Stephen P. Robbins

Personnel management is the planning, organizing, directing and controlling of the procurement, development, compensation, integration, maintenance and separation of human resources to the end that individual, organizational and societal objectives are accomplished- Edward Filippo

Recent literature on knowledge management and creation of people-centric partnership suggests that there is a need to increasingly integrate information technology (IT) with human competence for optimum utilization of both kinds of resources.


An analysis of various definitions indicates that human resource management includes the following activities:

i. Aligning the HR strategy with the corporate strategy of the organization.

ii. Working for the wellbeing of all the employees.

iii. Developing employee competencies.


iv. Sourcing, deployment, and development of human resources for optimal utilization.

v. Employee empowerment.

vi. Performance management.

Human resource management can be defined as a strategic and coherent approach to the management of the most valued assets of an organization, i.e., people, who individually and collectively contribute to the organizational objectives. Storey (1989) has made a distinction between ‘hard’ and ‘soft’ versions of HRM. The hard approach focuses on the quantitative and strategic aspects of managing the human resources.

It is a rational approach, which deals with human resources like any other economic factor. It emphasizes the need for managing people to enhance their contribution to improving the quantitative advantage of the organization. It aims at protecting the interests of the management and building a strong corporate culture by internalization of the mission and value statements of the organization.

The soft approach to HRM, whose roots can be traced to the human resource school, emphasizes factors such as communication, motivation, and leadership. It treats employees as the essential means of realizing organizational objectives rather than mere objects. It focuses on engendering commitment among employees by winning their hearts.

Human Resource Management – Roots

HRM activities have probably been performed since ancient times. As a formal discipline, however, its roots are traceable to the period immediately following the Industrial Revolution.


The pioneering work of Peter Drucker and Douglas McGregor in the 1950s laid its formal foundation.

Drucker, in his book “Practice of Management” writes, “An effective management must direct the vision and effort of all managers towards a common goal.” The concept of a visionary goal-directed leadership is fundamental to HRM. Douglas McGregor advocated management by integration and self-control, partly as a form of management by objectives, but more importantly, as a strategy for managing people which affects the whole business.

He believed that a management philosophy needed to be built up, based on attitudes and beliefs about people, and the managerial role of achieving integration. He, like Drucker, therefore, paved the way to the HRM philosophy that human resource policies and programmes must be built into the strategic objectives and plans of the business and must also aim to get everyone involved in the achievement of these objectives and plans.

The behavioural science movement came into prominence in the 1960s. It was founded by writers such as Maslow whose hierarchy of human needs placed self-fulfillment or self-actualisation at the top of the pyramid, and Likert, who developed his integrating principle of supportive relationships.

Another important figure in the behavioural science movement was Argyris who believed that organisation design should plan for integration and involvement and that individuals should feel that they have a high degree of self-control over setting their own goals and over the paths to defining those goals.


The most influential member of the behavioural science school, however, was Herzberg who advocated job enrichment as a means of increasing organisational effectiveness claiming that such improvements should centre on the work itself as a source of motivation. If people feel that the job is challenging, they will be moved to perform it well.

This school of thought made two useful contributions to HRM. First, it underlined the importance of integration and involvement, and second, it highlighted the idea that management should accept as a basic value the need of consciously improving the quality of working life as a means to obtain increased motivation and improved results.

The philosophy of management by objectives (MBO) can also be traced to this period.

MBO mainly refers to:

(1) Establishment of goals and objectives,

(2) Formulation of action plans, and


(3) Reviewing and modifying human behaviour.

The concepts of the behavioural scientists provided the impetus for the organisational development (OD) movement of the 60s and 70s, whose beliefs were summarised by Bennis as follows:

(i) A new concept of man, based on increased knowledge of his complex and shifting needs which replaces an oversimplified, innocent, push-button idea of man.

(ii) A new concept of power, based on collaboration and reason, which replaces a model of power based on coercion and threat.

(iii) A new concept of organisation values, based on humanistic and democratic ideas, which replaces the mechanistic value system of bureaucracy.

The organisation development specialists attempt to change the attitudes, values, and behavioural patterns of individuals and work groups in order to promote greater co-operation among organisational members.


The OD movement advocated the implementation of programmes designed to improve the effectiveness with which an organisation functions and responds to change, with particular emphasis on how people carry out their work and interact with one another. The management of change and team development are often important parts of an organisation development programme.

Human Resource Management – Objectives

The main objectives of HRM are as follows:

1. To help the organization attain its goals by providing well-trained and well-motivated employees.

2. To employ the skills and knowledge of employees efficiently and effectively.

3. To enhance job satisfaction and self-actualization of employees by encouraging and assisting every employee to realize his/her full potential.

4. To establish and maintain productive, self-respecting and internally satisfying working relationships among all the members of the organization.


5. To bring about maximum individual development of members of the organization by providing opportunities for training and advancement.

6. To secure the integration of all the individuals and groups with the organization by reconciling individual/group goals with those of an organization.

7. To develop and maintain a quality life which makes employment in the organization a desirable, personal and social situation.

8. To maintain high morale and good human relations within the organization.

9. To help maintain ethical policies and behavior inside and outside the organization.

10. To manage change to the mutual advantage of individuals, group, the organization and the society.

11. To recognize and satisfy individual needs and group goals by offering appropriate monetary and non-monetary incentives.

Human Resource Management – Components

i. Human Resource Organisation:

Human resource organisation is concerned with achieving success by organisation design and development, motivation, the application of effective leadership, and the process of getting across the message about what the enterprise is setting out to do and how it proposes to do it.

The fundamental objective of human resource organisation is to ensure that every aspect of the organisation, employment, motivation and management of people is integrated with the strategic objectives of the business and contribute to the successful achievement of those objectives.

The human resource organisation programme has to take account of cultural issues so that the desired corporate culture can be developed or reinforced. Moreover, organisational development programmes and interventions are needed to achieve better integration, improve teamwork, motivate human resource, develop proper leadership, facilitate communication system, manage conflict and change, and obtain commitment.

ii. Human Resource Planning:

Human resource planning sets out to define how many people the organisation wants, but with a particular interest in the type of people the organisation needs at present and in the future, in terms of their expertise and how they “fit” the corporate culture. It involves the forecasting of both the supply and demand for future labour. It provides the base for recruitment programme and for human resource development plans.

iii. Human Resource Systems:

Human resource systems are the essential programmes needed to recruit, appraise, pay and look after the health, safety and well-being of the employees in the organisation.

The main key programmes are:

1. Recruitment Management- It is a process of obtaining the required human resource for an organisation.

2. Information Management- It is a method of ensuring that all policies and practices are well articulated and effectively communicated to the workforce.

3. Training Management- It is a system of identification of training needs, preparation of a training strategy, and an appropriate training system.

4. Performance Management- It is a technique of appraising performance systematically against defined criteria, reviewing progress to date and assessing the potential for advancement. There are three main appraisal systems such as performance appraisal, potential appraisal, and performance coaching or counseling.

5. Reward Management- This ensures that people are rewarded in accordance with their contribution.

6. Career Management- It is system of charting special career paths for individual employees for advancement in the organisation.

7. Health and Safety Management- It is a system of maintaining a healthy and safe system of work in an organisation.

8. Discipline Management- It is a system of administering discipline to foster positive employee behaviour that will promote organisational objectives.

9. Culture Management- It is a system of thinking and behaving shaped by the values, attitudes, rituals and sanctions in an organisation.

Human Resource Management – How HRM and SHRM Could Help Firms?

Organisations have come to realise, over the years, that improving technology and cutting costs enhance performance only upto a point. To move beyond that point, the organisation’s people are its most important resource. In the end, everything an organisation does depends on people.

Low cost and high quality cars like Toyota and Saturns are not just a product of sophisticated automated machines. Instead, they are the result of committed employees all working hard to produce the best cars that they can at the lowest possible cost. To get the best out of people, the organisation must offer a healthy work climate where they can use their knowledge, skills and abilities fully while realising organisational goals.

This is where HR managers play a crucial role — that of bridging gaps between employee expectations and organisational requirements by adopting appropriate HR policies, strategies and practices.

HRM, it is generally felt now, would often competitive advantage if:

1. HR policies are jointly developed and implemented by HR and operating managers.

2. HR puts focus on quality, customer service, employee involvement, teamwork and productivity.

3. HRM strategies and practices are in tune with employee expectations, customer needs and changing competitive requirements. To be effective, HR strategies must fit with overall organisational strategies, the environment in which the firm is operating, unique organisational characteristics and organisational capabilities.

Strategic human resource management (SHRM) is the process of linking the human resource function with the strategic objectives of the organisation in order to improve performance. SHRM realises that people can make or break an organisation because all decisions made regarding finance, marketing operations or technology are made by an organisation’s people.

So, it accords highest priority to managing people and tries to integrate all HR programmes and policies with the overall corporate strategy. It compels people at all levels to focus more on strategic issues rather than operational issues. More importantly, it believes that there is no best way to manage people in any given organisation.

Even within a given industry, HR practices can vary extensively, from one organisation to another. Armed with such a flexible approach, SHRM tries to develop a consistent, aligned collecting of practices, programmes and policies to facilitate the achievement of the organisation’s strategic objectives.

Strategic HR shifts attention, as against the traditional HR’s focus on employee relations, to partnerships with internal and external groups. The focus on managing people is more systemic with an understanding of the myriad factors that impact employees and the organisation and how to manage multiple relationships to ensure satisfaction at all levels of the organization. Strategic HR is transformational in nature, so that it helps the people and the organisation to adopt, learn and act quickly.

“It will make sure that change initiatives that are focused on creating high performance teams, reducing cycle time for innovation, or implementing new technology are defined, developed and delivered in a timely way”. Strategic HR is proactive and considers various time frames in a flexible manner. Likewise, it permits employees to process work and carry out job responsibilities in a free-flowing way.

Rather than being enveloped by tight controls and excessive regulations, operations are controlled by whatever is necessary to succeed, and control systems are modified as needed to meet changing conditions. Job design is organic, specialisation is replaced by cross training and independent tasks are replaced by teams, encouraging autonomy at various levels.

Above all, strategic HR believes that the organisation’s key assets are its people. It realises that an organisation can have competitive edge over its rivals if it is able to attract and retain knowledge workers who can optimally utilise and manage the organisation’s critical resources.

In the final analysis, people are the organisation’s only sustainable competitive advantage. While running the show, strategic HR, of course, argues that any individual in an organisation who has responsibility for people is an HR manager, regardless of the technical area in which he or she works. Strategic HR offers three critical outcomes- increased performance, enhanced customer and employee satisfaction and increased shareholder value.

These outcomes are accomplished through effective management of staffing, retention and turnover processes, selection of employees that fit with both the organisational strategy and culture, cost-effective utilisation of employees through investment in identified human capital with the potential for higher return; integrated HR programmes and policies that clearly follow from corporate strategy; facilitation of change and adaptation through a flexible, more dynamic organisation; and tighter focus on customer needs, emerging markets and quality.

Human Resource Management – HRM in the New Millennium

The workplace of 21st century has undergone tremendous changes in recent times. Market forces have started dictating terms to the firms. Every firm is expected to deliver excellent results in terms of cost, service, technology, speed, etc. Customers, on their part, have become very intelligent in switching sides in order to pocket resultant gains.

They have become notoriously fickle minded and mistakes — howsoever insignificant they might be — are not going to be tolerated. The trends in the marketplace are quite disturbing, to say the least, and require close attention.

I. Globalisation will Pick-Up Speed:

Like water finding its way, firms will rush to places where they are able to find comfort. This would mean pushing down manufacturing, ownership, sales, design to every corner of the globe literally — based on how economical such a step would be.

This would mean Google going to China, Tata Motors stepping into Africa, IBM getting out of China, or Infosys stepping into rural areas for hiring talent. In the face of globalisation, companies are compelled to work harder and smarter than they did without globalisation.

II. Rapid Advances in Technology:

Increased automation, modernisation and computerisation have changed the way the traditional jobs are handled. In such a scenario unless employees update their knowledge and skills constantly, they cannot survive and grow.

This will necessitate training, retraining and mid-career training of operatives and executives at various levels. Where such initiatives are missing, it becomes very difficult for employees to face the forces of technology with confidence and get ahead in their careers steadily.

III. Talent Management:

The war for talent will continue. It is not easy to find people with requisite skills, knowledge and experience in the market place readily. To compound the problem further, you need to find people with the right kind of mental attitude. As long as there is a cultural mismatch, employee attrition rates will keep rising in the years ahead.

Managing lay-offs would be a matter of great concern as this will cause serious heartburn among employees leaving the firm. The survivors would look at every move of management with great suspicion. HR managers need to perform the balancing act, bringing everything to the table.

IV. Performance, Performance and Performance:

Companies will be ready to do anything possible to get the best results out of people. Because they have a compelling reason to remain at the top in this era of global competition. They have to deal with competitive attacks from any corner, from anywhere, from any player — small or big is not going to make much of a difference, as long as they leave a gap to be exploited by others to advantage.

This is where HR managers could play a major role that of aligning business strategy with operational dynamics. While converting the rhetoric into concrete reality, HR could play a bigger role — whether in the form of participation in the formation of goals and in their implementation.

V. Workforce Diversity:

Competition in every conceivable area or sector is hotting up everywhere. So there is no use talking about local talent and local management. You have to think global and deliver results matching the performance of global majors in terms of cost, quality, design and service.

You get bulldozed when you begin to take rest on past laurels. You have to be on your toes constantly and run like a race horse if you want to be in the reckoning. This is where companies have to hire people with relevant skills, experience and knowledge. Workforce is also turning young and, more importantly, mobile.

They are willing to switch gears and change hats if the inducements are exciting enough. So, not surprisingly, most companies are bombarded with numbers from almost every corner of the globe.

Workforce diversity, as a result, has become a real challenge staring at the face of most HR managers in recent times. You have to align your systems, practices with the multifarious expectations of a diverse work group — in terms of race, religion, caste, region, age, education and what not.

VI. Organisational Dynamics:

Organisations need to be more agile and flexible in the years to come. They have to turn leaner and leaner as years roll by. Every attempt must be made to cut the extra fat wherever it is found. Flatter organisations, cross-functional teams, decentralised structures will bring in the requisite flexibility needed to survive the ups and downs in a business cycle.

HR managers will have to give their best while trying to strike the rapport between technology, resources, people and ideas. Investment in human capital (refers to the knowledge, education, training, skills and expertise of a firm’s employees) would prove to be very rewarding. Without significant investments in human capital, organisations will not survive and flourish in a competitive world.

HRM is primarily responsible for the people dimension of an organisation. Its basic philosophy is built around people at work, that is, when properly motivated, even ordinary people can deliver extraordinary results.

HRM aims at achieving organisational goals develop the potentialities of people at work and meet their expectations and thereby improve the quality of working life and manage human resources in an ethical and socially responsible manner.

The basic approach of HRM is to perceive the organisation in its totality. Its emphasis is not only on production and productivity but also on the quality of life. It seeks to achieve the fullest development of human resources and the fullest possible socio-economic development.

Human Resource Management – Features

Some of the important features of human resource management may be listed thus:

1. Put People on Track and Develop their Potential Fully:

While realising the corporate goals, the HR manager does everything possible to create ‘the fire in the belly’ and put people on track. Growth opportunities are thrown open to all. Developmental initiatives are undertaken with zeal, enthusiasm and sincerity. There is a concerted effort to develop the potentialities of people to the fullest possible extent. HR manager encourages people to give their best to the organisation.

Dedicated efforts are aimed at attracting, nurturing and retaining talent. The intent is very clear. Get the best people to deliver excellent results by offering the best, in terms of rewards, incentives, benefits — both tangible and intangible.

It is not always through monetary incentives and rewards that people get motivated. So, efforts are directed to enrich jobs and enthuse people by putting them on jobs with stretch, pull and challenge.

The importance of having the services of competent and motivated employees is being recognised throughout the organisation. As indicated by Pigors and Myers HRM is basically a method of developing potentialities of employees, so that they get maximum satisfaction out of their work and give their best efforts to the organisation.

2. Attract, Nurture and Develop Talent:

HRM is a strategic approach to the acquisition, motivation, development and management of the organisation’s human resources. It is a specialised field that attempts to develop programmes, policies and activities to promote the satisfaction of both individual and organisational needs, goals and objectives.

3. In Sync with Corporate Goals and Mission:

It is devoted to shaping an appropriate corporate culture, and introducing programmes which reflect and support the core values of the enterprise and ensure its success.

4. Proactive and not Reactive:

HRM is proactive rather than reactive, i.e., always looking forward to what needs to be done and then doing it, rather than waiting to be told what to do about recruiting, paying or training people, or dealing with employee relations problems as they arise.

5. Focus on Qualitative Improvement of Human Element:

In its essence, HRM is the qualitative improvement of human beings who are considered the most valuable assets of an organisation — the sources, resources, and end-users of all products and services. HRM is, no doubt, an outgrowth of the older process and approach. But it is much more than its parent disciplines, viz., personnel management and behavioural science.

It is a scientific process of continuously enabling the employees to improve their competency and capability to play their present as well as future expected roles so that the goals of the organisation are achieved more fully and at the same time the needs of the employees are also met to an adequate extent.

6. Multidisciplinary and Comprehensive Approach:

HRM is also more comprehensive and deep-rooted than training and development. Its approach is multidisciplinary from the beginning to the end. HRM is a production model approach to personnel management.

7. Employee-Oriented:

The HRM model is characterised as being employee-oriented with an emphasis on the maximisation of individual skills and motivation through consultation with the workforce so as to produce high levels of commitment to company strategic goals. It is a resource to be used to its fullest capacity. It is an asset to be invested in.

8. Strategic in its Approach:

The traditional personnel management is non-strategic, separate from the business, reactive, short-term and constrained by a limited definition of its role as dealing with mostly unionised and low level employees. If personnel management is curative, HRM is preventive. The key distinguishing feature of HRM is its evolving strategic role.

9. Integrative in Nature:

HRM essentially emphasises and incorporates those expectations which are not being fulfilled through the traditional personnel management. It integrates in a meaningful way the various subsystems like performance appraisal, potentiality appraisal and development, career planning, training and development, organisation development, research and systems development, rewards, employee welfare and quality of work life, industrial relations, human resource information, and so on.

10. Healthy Assumptions about People, Organisation and Its Processes:

Under the HRM approach, some basic assumptions about human resource are also different from the traditional approach.

The important assumptions of HRM are as follows:

i. The members of an organisation are reservoirs of untapped resources.

ii. There is scope for unlimited development of these resources.

iii. It is more in the nature of self-development than development thrust from outside.

iv. The organisation also undergoes development with the overall benefits along with the development of its members.

v. The organisation further develops a culture in which utmost emphasis is placed on harmonious superior-subordinate relations, teamwork, and collaboration among different groups of individuals, open communication, and above all, integration of the goals of the organisation with the needs of the employees.

vi. Top management takes the initiative for HRM, formulates necessary plans and strategies, and creates an overall climate and support for its implementation.

Human Resource Management – Importance

Human resources play a crucial role in the development process of modern economics. Arthur Lewis observed “there are great differences in development between countries which seem to have roughly equal resources, so it is necessary to enquire into the difference in human behaviour.” It is often felt that, though the exploitation of natural resources, availability of physical and financial resources and international aid play prominent roles in the growth of modern economies, none of these factors is more significant than efficient and committed manpower.

It is, in fact, said that all development comes from the human mind. For example the per capita GDP of Ghana and South Korea was more or less the same in 1964, but human resources development of South Korea made it as an advanced country while the human resources of Ghana are responsible for the latter backwardness.

1. Human Resource in the Nation’s Well-Being

A nation with abundance of physical resources will not benefit itself unless human resources make use of them. In fact, human resources are solely responsible for making use of national resources and for the transformation of traditional economies into the modern and industrial economies.

Lack of organisation of human resources is largely responsible for the backwardness of the nation. Countries are underdeveloped because their people are underdeveloped. In essence, “the difference in the level of economic development of the countries is largely a reflection of the differences in quality of their human resources….”

The growth of Japan, Singapore, China and India is mostly due to their knowledgeable and competitive human resources. The key element in this proposition is that the values attitudes, general orientation and quality of the people of a country determine its economic development. The shift from manufacturing to service and service to knowledge economies are making human resources the core ingredient to the nation’s well-being and global competitiveness.

2. Man Vis-A-Vis Machine:

Most of the problems in corporate sector are human and cultural rather than physical, technical or economic. No industry can be rendered efficient as long as the basic fact remains unrecognised that it is principally human. It is not & mass of machines and technical processes but a body of men. Its body is not an intricate maze of mechanical devices but a magnified nervous system.

3. HRM and General Management:

Management of an organisation in modern economies is not only complex and sophisticated but it is also vital, and influences the economic growth of a country. Its efficiency determines the property and well-being of the people of the nation. “Perhaps today there is no other latest activity which is as important and dynamic as management — the oldest of arts and newest of profession.”

One of the fundamental areas of management is the management of human resources. Thus, “in the management of four Ms. — Money, Materials, Machines and Men — it is needless to be labour the obvious point that, considering the nature of man, the management of men….” is not only fundamental but also dynamic and challenging.

One of the fundamental tasks of management is to manage human resources, in the service of the economic objectives of the enterprise. Successful management depends not solely, but significantly upon the ability to predict and control human behaviour. Among other things, if a company is economically successful, it means, the management has been able to manage human resources effectively. The human resources are “the active force of industrialisation and strategies for development should concentrate particularly on their enhancement.”

Earnest Dale views management as the process of getting things done through people. In fact, it is said that all management is human resource management as it deals with human beings.

Thus, all executives must unavoidably be human resource managers. In short, all managers are human resource managers and all management is essentially human resource management.

4. People First:

You Take care of your employees!

They take care of customers!

Customers take care of Business!

Business takes care of Your Profits/ mission.

Some of the modern managers particularly of highly successful companies realize that people/ human resource should be the first as their ideas, innovations, decisions and actions drive the business into a dynamic and responsible organization. In contrast, people/ human resources can basically mar a business, if they are not properly managed. Thus, people can make or mar an organization.

5. Human Resources System is a Central Sub-System:

Human resources system in an organisation is not only a unique subsystem but a principal and central sub-system and it operates upon and controls all other sub-systems. Thus, in the words of Wendell L. French, “Human resource management is a major pervasive sub-system of all organisations.”

Peter F. Drucker has rightly observed the significance of human resources as; managers are fond of repeating the truism that the only real difference between one organisation and the other is the performance of people. In essence, the survival, development and performance of an organisation – although not solely but heavily – depend on the quality of human resources.

6. Human Resources Accounting:

One important development arising out of the recognition of crucial importance of human resources in organisations is the Human Resources Accounting. During the early 1960s, behavioural scientists attacked conventional accounting practice for its failure to value the human resources of an organisation along with its money and material- resources.

The potential and promise of human resources accounting have been thus recognised by the accountants. Human Resources are identified as the value of the production capacity of a firm’s human organisation, and the value of its customer’s goodwill. Eric Flanholtz defines human resources accounting as, “accounting for people as organisational resources. Human Resources accounting is the measurement of the cost and value of people for organisation.”

It is clear from this definition that, human resources accounting is useful to both general managers and human resource managers since human resources information influences the planning and controlling functions of management and various operative functions of human resource management.

It helps the management to utilise human resources most economically and efficiently. It also helps the managers in making sound decisions in human resource matters by providing required information. Thus, it is a very useful control technique.

7. Human Resource and Market Economy:

The three important areas of human resources are skill, ability and knowledge. Knowledge plays most vital role in the modern industry as rail road played its role during the 19th century business and as assembly line played its role during the 20th Century. According to P.F. Drucker, “knowledge is the only meaningful resource today.” All other resources flow freely across borders.

8. Knowledge and Competitive Advantage:

Modern business has been undergoing changes at a fast rate due to changes in technology, liberalisation of economies, etc. The changes in the business resulted in severe competition. The business should have knowledgeable employees to have competitive advantage over the competitors.

In the words of Thyagarajan, Managing Director, Glaxo, “organisations that have world class ambitions will need to nurture knowledge workers.” As Adi B. Godrej, Chief Executive Officer, Godrej Soaps puts it, “all corporate strengths are dependent on people.”

9. Products and Human Resources:

Many companies compete based on the strength of their products. These companies have to use people as the source spring for winning concepts. In fact, product improvements are generated by people; creative and innovative products and services can be developed and modified only through intensive and planned human efforts. A successful product is developed by using knowledge as a core competence of the company.

10. Production and Human Resources:

The high technology industry dominates the shop floor. The role of the people in today’s production process is crucial. Production practices in today’s industry are assigning the total work to teams of workers and empowering them. The empowered teams produce the qualitative products. The knowledgeable workers with the help of advanced technology improve the productivity beyond the normal levels. According to Aspi Balsara, CEO of Balsara Hygiene, “easy access to technology has made people the differentiating factor in today’s environment.”

11. Marketing and Human Resources:

Companies are forced to improve the quality of products, quality of pre-sales and post-sales service, customer-producer interface and the like. Added to this, service sector has been enlarging its scope in the global economy. As Mike Khanna, CEO, Hindustan Thompson Associates puts forward as, “it is the rising demand from customers that is making people increasingly important.”

12. HR- As Distinctive Competitive Advantage:

The 21st century business houses realise that their distinctive competencies lie not in particularly products or technologies but in distinctive talent, competency, expertise and knowledge pool and skills of their people. Reengineered processes will not bring improvements unless the top managements ensure that their people’s attitudes and mindsets are also reengineered. Therefore, successful management techniques are focusing directly on people.

Findings of a joint research study by USA Today and Deloitte and Touche indicate that importance of HRM has grown substantially during the last ten years and the HR expenditures are now treated as strategic investment. HR has become more significant as skills, knowledge and abilities tire the most distinctive and renewable resources. Companies design strategies upon these resources.

13. Organisational Structure and Human Resources:

The modern structure is a pattern for deployment of people. The objective of structuring of modern organisations is to make the best possible use not only of technology, finance, or systems but also of people. Companies, in order to concentrate on the customer, are dismantling vertically functional departments and replacing them with horizontal cross functional and process-centric empowered teams. The emphasis is on resourcefulness, initiative autonomy and responsibility of the process-owners.

This analysis indicates that human resources are crucial in all operations. To reach the innovative frontiers of business, human resources of superior calibre and understanding are necessary. Such human resources are essentially, an important asset of the top management.

Human Resource Management – Functions

The functions of HRM are very wide. An agreement over them is rarely.

Broadly, the personnel function can be divided into two parts:

(A) Managerial functions and

(B) Operative functions.

(A) Managerial Functions:

1. Planning:

Planning is the main function of management. In the context of personnel management, it is concerned with manpower planning; studying labour turnover rate, forecasting the future requirements of Personnel and planning for selection and training procedures, etc.

2. Organising:

Organising involves the establishment of inter­relationships within organisation. It provides a structure for the company by identifying the various sub-groups heated by individuals in managerial jobs as well as operative jobs.

3. Directing:

Personnel management is directly concerned with direction function also. It includes issuing instruction to the workers, developing communication network, interpreting various industrial laws and integrating workers.

4. Controlling:

Personnel department helps in controlling also. It provides basic data for establishing standards, makes job- analysis and performance appraisal, etc. These all techniques assist in effective control of the qualities, time and efforts of workers.

(B) Operative Functions:

These are service or routine functions of personnel management.

They are as under:

1. Procurement of Personnel:

The first operative function of personnel management is concerned with the obtaining of the proper kind and number of personnel necessary to accomplish organisation goals. It deals specifically with such subjects as the determination of manpower requirements, their recruitment, selection, placement and orientation, etc.

2. Development of Personnel:

After personnel have been obtained, they must to some degree be developed before going to work. Development has to do with the increase of skill through training that is necessary for proper job performance. Various techniques of training are used in this process in order to develop the employees. Framing a sound promotion policy, determination of the basis of promotion and making performance appraisal are the basis of personnel development function.

3. Compensation to Personnel:

Compensation means, determination of adequate and equitable remuneration of personnel for their contribution to organisation objectives. It is one of the most difficult and important function of the personnel management to determine the monetary compensation for various jobs.

For choosing a suitable compensatory policy a number of decision are taken into the function, viz., job-evaluation, remuneration, policy, incentive and premium plans, bonus policy and co­-partnership, etc. In addition to this, it also assists the organisation for adopting the suitable wages and salaries policy and payment of wages and salaries in right time.

4. Maintaining Good Industrial Relations:

It is one of the most essential function of the personnel manager to create the harmonious relations between management and labour. It covers a wide field and is intended to reduce striates, promote industrial peace, provide fair deal to workers and establish industrial democracy. If the personnel manager is unable to make harmonious relations between the two that will be very harmful to the organisation.

The industrial unrestness will take place and a millions of man-days will be lost. The moral and physical condition of the employee will suffer, if labour management relation is not good and it will be a loss of an organisation vis- a-vis a nation. Therefore, it is the duty of personnel manager to make harmonious relation with the help of sufficient communication system and co-partnership.

5. Record Keeping:

Record-keeping is also an important function of personnel manager. In this system, personnel manager collects and maintain information, which is concerned with the staff of the organisation. Recording is essential for every organisation because it assists the management in decision-making such as in promotions.

6. Personnel Planning and Evaluation:

Under this system different type of activities are evaluated such as Evaluation of performance, Personnel policy of an organisation and its practices, Personnel Audit, Moral Survey and Performance Appraisal, etc.

7. Personnel Research and Audit:

It is also an important function of personnel management. This function is concerned with the research in newer motivational techniques and auditing its effect on the workers of the organisation, etc.

Human Resource Management – Models

One of the interesting tussles in the field of HRM is the tug of war between the proponents of the Hard and the Soft approaches to HRM. One party claims that people are the real heroes, the crucial difference between success and failure of a business. The other party lays strong emphasis on the centrality of bottom line business value as well as the absence of strategic integration with the corporate plan.

1. Michigan Model of HRM (The Hard Approach):

To improve performance at all levels, a company must directly align its corporate and human resource strategies and structures.

The model (by Fombrum, Ticy and Devanna) proposes that:

i. Individuals should be treated as organisational resources, and should be put to effective use.

ii. Fit should be achieved between individual and organisational strategies by selecting the most suitable persons to achieve its business activities and promoting optimum performance to achieve business objectives.

iii. Monitoring and appraising performance and providing appropriate feedback to employees.

iv. Rewarding performance.

v. Developing knowledge, skills and competence to achieve business objectives.

Hard HRM stresses the “resource” aspect of HRM. The model stresses HRM’s focus on the crucial importance of the close integration of human resource policies, systems and activities with business strategy.

From this angle, human resources are largely a factor of production, an expense of doing business rather than the only resource capable of turning inanimate factors of production into useful products and services. Human Resources are viewed as passive, to be provided and deployed as numbers and skills at the right price, rather than the source of creative energy.

Hard HRM is as calculative and tough-minded as any other branch of management, communicating through the tough language of business and economics. This emphasis on the quantitative, calculative and business – strategic aspects of managing the “headcount” has been termed as human asset accounting.

2. Harvard Model of HRM (The Soft Approach):

According to Beer, Walton and Spector, human resource policies are being influenced by two important factors- Situational factors — both internal as well as external — constrain the formation of HRM policies but (to varying degrees) they may also be influenced by human resource policies.

Human resource policies should be influenced by all stakeholders. If not, the firm will not be able to meet the requirements of these stakeholders in the long run and it will not succeed as an institution. The authors also contend that human resource policies have both immediate organisational outcomes and long-term consequences.

Managers can affect a number of factors by means of the policy choices they make including:

a. The overall competence of employees.

b. The commitment of employees.

c. The degree of congruence between employees’ own goals and those of the organisation.

d. The overall cost-effectiveness of HRM practices.

Beer et al. propose that these ‘four Cs’ do not represent all the criteria that human resource professionals can use to evaluate the effectiveness of human resource management, but consider them to be ‘reasonably comprehensive’ although they suggest that readers may add additional factors depending on circumstances.

The soft HRM model is associated with the human relations movement — reflecting McGregor’s Theory Y perspective — proposing that behaviour is primarily self-regulated rather than controlled by outside situations and external pressures. Relations between people in an organisation should, therefore, be built around trust and mutual respect.

Whilst emphasising the importance of integrating HR policies with business objectives, the soft model focuses on treating employees as valued assets and a source of competitive advantage through their commitment, adaptability and high quality skill and performance.

Employees are proactive rather than passive inputs into productive processes, capable of development, worthy of trust and collaboration which is achieved through participation. The soft version is seen as a method of releasing untapped reserves of human resourcefulness by increasing employee commitment, participation and involvement.

The model also proposes that employees will exhibit loyalty and commitment if they are trusted and allowed to work autonomously and have control over their work. In other words, the important assumption of the soft model, as against what is proposed by the hard model, is that control comes through commitment.

Under the hard model, on the other hand, control is more concerned with performance systems, performance management, and tight control over individual activities, with the ultimate goal being to secure the competitive advantage of the organisation. This implies that the individual is managed on a much more instrumental basis than under the soft model, where both competitive advantage and employee commitment are accorded equal importance.

As Keenoy (1997) has argued, according to mainstream HRM literature, the key managerial choice is one of adopting either a ‘hard HRM’ or a ‘soft HRM’ approach. It is clear that this view does not ‘fit’ with the ‘new competitive order’ identified above.

Because firms following this logic will be locking themselves into a dilemma situation; e.g., firms engage in ‘hard’ HRM to the exclusion of ‘soft’ HRM are likely to be effective in the short run but self-destructive in the long run because the ‘hard’ HRM model emphasises exclusively on resource exploitation, not on human resource development.

Conversely, firms that engage in ‘soft’ HRM to the exclusion of ‘hard’ HRM are likely to find that they suffer the costs of long-term human resource development without gaining many of its benefits. The key is to find the balance between soft and hard. And ‘finding the balance’.

3. The Guest Model:

The Harvard model, thus, emphasised communications, teamwork and the utilisation of individual talents. The Michigan school is a more strategic approach with a Unitarist outlook, which endorses the management’s viewpoint. Guest has proposed an alternative normative model of HRM, integrating both schools of thought.

Thus, HR policies should be integrated with strategic business planning and used to reinforce or change an appropriate organisational culture. Human resources are valuable and a source of competitive advantage and are tapped most effectively through policies that promote commitment.

The Model proposes that HR manager should focus on good HR practices (hiring, training, appraisal, compensation, employee relations) which would lead to HR outcomes such as commitment, quality and flexibility.

Good HR outcomes will bring in positive behavioural outcomes in the form of employee motivation, cooperation and organisational citizenship. Positive behavioural outcomes would bring in performance outcomes (productivity, innovation, quality, etc.) leading to better profits and return on investment.

More recently, Guest (2000) proposed a ‘Simple Model of HRM and Performance’ which suggests that HRM practices influence employee commitment, and employee commitment then influences employee performance, which in turn impacts on the organisation’s financial performance. This model was simplified from a model which Guest developed (1997).

The model is idealistic, implicitly suggesting that the basic assumptions of HRM approach — particularly those of the Harvard Map — such as commitment have a direct relationship with valued business consequences.

In any case, the concept of commitment is a messy one and the relationship between commitment and high performance is difficult to establish. Guest in this Unitarist approach has merely tried to integrate employee behaviour and commitment with the goals of strategic management in an attempt to resolve the controversy.

Human Resource Management – HRM Challenges in 21st Century

Changing Global Scenario:

Today when we are on the verge of twenty first century, very rapid and unprecedented changes are occurring at the Global as well as at the local levels. Most managers today have recognized the inevitability of the rapid, pervasive and profound changes in several aspects of human life. They have accepted perhaps that the only thing which is permanent part of their work life is “change” itself.

As a continuous process, change is constantly engulfing systems, products, technologies, methods, concepts, ideas and also the people. More and more organizations today have to face a dynamic and fast- changing environment that, in turn, requires those organizations to adapt. Accordingly, managers have to ensure that individuals and groups in organizations, and structures, processes and behaviours of sub-systems, adapt to the changing external and internal environment.

The changing global scenario has various forces that are acting as stimulants for change- the changing nature of the workforce, technology, economic conditions, changing social trends, the new world politics, and the changing nature of competition.

The nature of workforce in the present decade is changing, with a rapid increase in the percentage of women and minorities. Accordingly, organizations will have to learn to manage diversity. The human resource policies and practices will have to change in order to attract and keep this more diverse work force.

The increase in the participation rate of women in the work force also means dual – career couples. Organizations are having to modify transfer and promotion policies, as well as make child care and elder care available, in order to respond to the needs of dual-career couples.

The forthcoming socio-economic and environmental changes could cast an indelible influence on organizations in the world of work, on their cultures, on their human resources, on their quality of work life.

Quest for Pro-Active HRD:

The term “Human Resource” usually means total quantitative and qualitative human assets or people in an organization. As defined by Nadler, the human resource is – “the total knowledge, skills, creative abilities, talents aptitudes of an organization’s work force as well as the sum total of inherent abilities, acquired knowledge and skills represented by the talents and aptitudes of the employed persons”.

The term “Human Resource Development” generally means a process of organizing and enhancing the physical, mental and emotional capacities of individuals for productive work. According to Nadler, the core of HRD definition is- “to bring about the possibility of performance improvement and individual growth”. It is the process of helping people to acquire competencies and to increase their knowledge, skills, and capabilities for better performance and higher productivity.

In today’s fast-changing, challenging and competitive environment, HRD has to take a “pro-active” and not reactive approach. Reactive approach is that of taking action after the event. On the contrary, pro-active approach is that which seeks to accomplish preventive care in human relations.

In the highly competitive and dynamic environment, organizational survival and growth could largely depend upon the efficiency and effectiveness of the role of HRD as an accountable and pro-active function. As the HRD function becomes more and more proactive, maximization of efficiency and productivity could be achieved through qualitative growth of people with capabilities and potentialities to grow and develop.

HRD is always a function of proper utilization of creative opportunities and available environment through acquisition of knowledge, skill and attitudes necessary for productive efforts. The pro-active HRD holds the key to develop valuable resources of an organization i.e. the people, who spend the greater part of their working lives, making their organizations work effectively.

Quest for pro-active HRD could focus on creating highly inspired groups of employees with high aspirations to diversify around core competencies and to build new organizational responses for coping with change. While meeting the challenges of global change and stability in the next century, Human Resource Managers could significantly play the most contributing role in their organizations. They could assist the workforce to adjust to the world as it is changing; and to develop resilience not only to cope with chaos brought by change, but thrive in it.

Quest for pro-active HRD is gradually on increase and the trend will continue in future because development of human resources is of paramount significance for economic development and also for improving the quality of life of the people. When HRD becomes a pro-active function in an organization, its activities get geared up and directed at improving personal competence and productive potentialities of human resources.

Today, changes in market conditions, rising expectations of the employees, developments in technology and changes in management practices have necessitated increased emphasis on pro-active HRD for accelerated growth and development. As the organizations in the world of work are facing simultaneous demands for improved quality, reduced costs and constant innovations, pro-active HRD is increasingly recognized as an important force in deriving organizational efficiency and effectiveness.

It is a well-established fact that in the ultimate analysis, organizational success depends upon people – the human resources – whose skills, capabilities and knowledge require to be constantly developed and upgraded.

HRM Issues and Concerns in Future:

The basic concern of human resource management is not merely upgradation of skills, but to take care of the wholesome change in the environment – the velocity of the technology revolution, the rate of obsolescence, the magnitude of information explosion and the organizational dynamics. As the globalization process is progressing at a breakneck speed, HRM must be consistent with the newly emerging techno-economic and socio-cultural scenario.

Various studies and research works from Behavioural Science have made a solid impact on management thinking and management action through emphasizing the importance of human element in organizations. These research contributions have time and again pointed to the fact that whatever may be the quality, efficiency or stage of technological development, unless human factor gets its dues, no system can work to its maximum efficiency.

Obviously, HRM in the changing scenario today, has to focus its attention on the basic issues of its obligation to protect and enhance human resources; and its commitment to the task of improving QWL.

HRM in future will be more and more concerned with planning, organizing, directing and controlling of the procurement, training and development, compensation, integration and maintenance of human resources so as to accomplish individual, organizational as well as societal objectives.

Here in lies essence of the issues and concerns of HRM in future. HRM has to integrate all these functions in the HRD way – i.e. bringing about a reasonable “reconciliation of individual, organizational and societal interests. This is indeed a great challenge. Human Resource Managers will be increasingly concerned with developing programmes that have overlapping interests for all the employees, organization and the society at large. The major issue and concern of HRM in future will be integration of people into a work situation; integration of all the functions in the HRD way.

Challenges to HRM:

Every organization has a personnel function as it must live, train, pay, motivate and maintain employees. Today the human resource managers are required to plan, organize, direct and control the procurement, development, compensation, integration and maintenance of the workforce so that the organization may accomplish its designated objectives.

As we have already seen HRM in future will be increasingly concerned with integrating all these functions in the HRD way, in order to effect a reasonable reconciliation of individual, organizational and societal interests. HRM will have to increasingly face this challenge in future with the changing scenario in the world of work. In the newly emerging socio-cultural pattern, society may impose human goals upon organizations and these goals may or may not make an immediate contribution to an organization’s particular objectives.

Obviously HRM has to face the challenge of bringing about a reconciliation of employee needs management’s expectations and society’s requirements. While surviving and thriving well in the changing scenario, the greatest challenge to HRM is that of balancing the confluence of these three major streams of influence.

The changing scenario in the world of work has produced an environment of turbulence and uncertainty so much so that it calls for a major reorientation in the philosophy, policy, programmes and practices of managing personnel at work. With the rising expectations of people and higher performance standards from organizations, HRM is required to apply more creativity and innovation in human resource practices.

In future, HRM will be increasingly required to deal with issues and problems that often do not have “right answers” or the “only best answers- obvious to all. Human resource managers must develop an ability to understand that which is not logical and a capacity to project themselves into other positions without losing perspective. The skill in understanding, predicting and controlling human and organizational behaviour will become vital for HRM practitioners.

In order to achieve this, broad knowledge of Behavioural Science will become the necessary pre-requisite. Human resource managers will have to use successfully the Behavioural Science knowledge – especially in such fields as organizational behaviour, Industrial Psychology, Industrial Sociology and Management Philosophy and Ethics.

HRM in future will be increasingly committed to improve work culture and productivity by applying Behavioural Science knowledge. HRM will have to face the challenge of creating positive work climate where employees visualize themselves as members of a team and honestly put in dedicated efforts to accomplish the desired goals.

Another challenge which is also brought forth by the emerging era is that of increasing concern for participation and quality of life. There is also a growing concern about total quality management (TQM), and customer orientation. All these points essentially indicate that the most important challenge which HRM has to face is to pay increasing attention to the relational quality of organizational members.

Organizational workforce is composed of employees who both create and operate within the relational context. The quality of relationships makes one organization different from the other. Relationships among people – different groups, customers, engineers sales and marketing people, suppliers, unions, executives and employees – are central determinants of organizational life.

While trying to enhance the relational quality of organizational workforce, HRM efforts should be concentrated on achieving relational harmony, rather than relational hierarchy among people and cultures through demonstrating a respect for relationships.’

HRM’s challenge of achieving results relationally will have significant implications on selecting the right person for the right job. Human resource managers will be required to identify and attract people who can bring into the relationship network the essential skill, knowledge, attitude and support needed by others.

While meeting the challenge of integrating people into a work situation HRM will have to concentrate on motivating personnel to work together co-operatively and productively. Accordingly, HRM will face distinct need to find novel ways to recognize and reward the accomplishments of individuals as well as of teams.

Motivation and inspiration being crucial function, human resource managers will have to understand, honour, accept, and accommodate the complex and changing needs and values of employees in increasing measures. Diversity and complexity in rewards and compensation will have to be managed. Since all the three levels of performance i.e. individual performance, team performance and organizational performance will have to be taken into consideration.

Employees at work have multiple needs and wants as “whole persons” and organizations have to meet the multiple needs of multiple and diverse stakeholders. HRM has to face the challenge of integrating and meeting the needs of employees and the needs of the organization so as to achieve employee well-being and profit; employee development and customer satisfaction.

Yet another very significant and vital challenge before HRM is to establish and maintain a dialogue among diverse stakeholders by means of appropriate communication. This will help in coordinating efforts and actions of organizational workforce with constructive orientation.

Very significant and perceptible change in personnel philosophy, policies, programmes and practices based on positive approach is essentially to be introduced by HRM professionals, in pro-active manner. Thus, the challenges to HRM bring forth the developmental role of human resource managers.

Quest for Proactive HRD- The Pressing Need of the Hour:

Today when we are on the verge of the twenty first century, very rapid and unprecedented changes are occurring at the global, national and local levels. Accordingly, several social scientists are predicting the future socio­economic environment in the now globalizing India. The overall predictions tend to suggest that our society will become more and more pluralistic, that is there will be more centres of social and political powers spread out Doth in’ urban and rural areas, although the absolute quantum of economic power will shift more to the centre – to the central government as well as to the big industrial houses.

The hitherto neglected weaker sections and minority groups will become more demanding and assertive. General view prevails that technologies appropriate for various productive sectors such as industry agriculture, and service organizations will grow and they will enter rural areas but economic disparities will grow. The relative income differences between the different occupation groups, the classes of rich, middle and poor will grow – although the absolute minimum income at lower levels may increase.

Thus we can foresee that the forthcoming socio-economic and environmental changes could cast on indelible influence on our organizations in the world of work, on their cultures, on their Human Resources, and on their Quality of work Life. Obviously, the important need of the hour is that organizations should take advance, proactive HRD measures to cope with this fast-spreading future scenario.

This has indeed become the pressing need in view of the great velocity of current changes that are taking place in our “globalizing” India. The new changes have brought forth new challenges for survival, new opportunities for growth and new threats as well. Needless to say that only fittest will survive.

To be able to survive and grow, organizations will have to manage and master the change properly. If they cannot do so, they could end up like the dinosaurs and become extinct. Thus, organizations have an option- they can either be agents or victims of change.

In order to learn how to manage and master the change, there is great need to adopt proactive HRD measures which encourage values of openness, trust, autonomy, proactivity and experimentation.

In the highly competitive and dynamic environment at present, any organization’s survival and growth could largely depend upon the efficiency and effectiveness of the role of HRD as on accountable and proactive function. As the HRD function becomes more and more proactive, maximization of efficiency and productivity could be achieved through qualitative growth of people with capabilities and potentialities to grow and develop.

In today’s fast changing and challenging environment, HRD has to become a proactive function so that its activities get geared up and directed at improving personal competence and productive potentialities of manpower resources. The development of human resources is of paramount significance for economic development and also for improving the quality of life of the people.

Changes in market conditions, rising expectations of the employees, developments in technology, and changes in management practices have necessitated increased emphasis on proactive HRD for accelerating growth and development. In the ultimate analysis development depends upon people whose skills, capabilities and knowledge requires to be constantly developed and upgraded.

The term Human Resource development generally means a process of organizing and enhancing the physical, mental and emotional capabilities of individuals for productive work. It is essentially a process of helping people to acquire competencies and to increase their knowledge, skills and capabilities for better performance and higher productivity.

The proactive HRD essentially holds the key to develop valuable resources of an organization that is people, who spend a greater port of their working lives, making their organizations work effectively.

Quest for proactive HRD must necessarily start at the top level. Top leadership is the critical ingredient behind success at every level of human endeavour. Top management’s commitment to human development certainly helps in building credibility.

Today top managements are facing simultaneous demands for improved quality, reduced costs, and constant innovations. This fact has significant implications for human resource development function in the organization and also for HRD as a profession. Quest for proactive HRD could effectively focus on creating highly inspired groups of employees with high aspirations to diversify around core competencies and to build new organizational responses for coping with change.

Thus, while the CEOs will be meeting the challenges of global change and stability in the next century, HRD will have to become a continuous and dynamic process for training, capacity building and developing the people at work so as to enable them to respond to changing priorities of organizations.

Intensive initiatives are required from top management to carry out a sincere quest for proactive HRD and to get emotionally committed to it. We have examples of organizations like Tata Iron and Steel Company (TISCO) which have taken proactive approaches in HRD and have greatly benefitted in terms of organizational effectiveness.

Proactive HRD practices can positively contribute to set the journey in the right direction. They set the tone with creation of right attitudes and values like honesty, integrity, openness and trust etc. They can help in building capabilities, commitment and culture of self-responsibility.

They can also help: in developing healthy interpersonal and intergroup relations which foster a spirit of sportive competition and co-operation so vital for generating team excellence. Quest for proactive HRD could bring forth ways and means to strengthen the involvement and effectiveness of teams through building core competencies and essential skills.

Proactive HRD practices can successfully integrate productivity with quality of work life and thus enable the organizations to excel in their performance and effectiveness. With growing awareness at the top level, the quest for proactive HRD will soon gear up in many organizations as it is indeed the pressing need of the hour in the case of our “globalizing”.