Everything you need to know about the scope of human resource management. The scope of HRM is immense for any organization plying in today’s dynamic business environment.
The entire process starts right from the manpower planning process and revolves around an organization’s hiring practices, employee and executive motivation, maintenance, performance evaluation and compensation management, industrial relations and the employee retention plans and strategies.
The scope of HRM is vast. HRM is not limited to the activities concerning employment and retention of people. It has a wide area the coverage of which starts from forecasting and vision exercise, for HR demands of the organization till exit of the personnel including activities during intervening process.
Learn about:- 1. HRM and 3Ps 2. HRM and IT 3. HRM and Strategic Management 4. HRM and Competency Enhancement 5. HRM and TQM 6. HRM and Performance Management 7. HRM and Leadership Development
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8. HRM and Change 9. HRM during Other Organizational Phenomenon 10. HRM in Personnel Management 11. HRM in Employee Welfare and 12. HRM in Industrial Relations.
Additionally, learn about :- 1. Employee Hiring 2. Compensation Management 3. Employee Motivation 4. Employee Maintenance and 5. Industrial Relations.
Learn about the Scope of Human Resource Management
Scope of Human Resource Management – HRM and 3Ps, HRM and IT, HRM and Strategic Management, HRM and Competency Enhancement and Few Others
The term ‘HRM’ is called by several names such as ‘personnel management’, ’employee relations’, ‘manpower management’, ‘industrial relations’, ‘labour management’ and ‘human capital’ management and speaks for the fact that the scope of HRM is very wide.
As HRM is concerned with the ‘human beings at work’, it is basically concerned with the recruitment, retainment and retirement of manpower and, therefore, takes care of the manpower from recruitment to retirement.
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That is why it is said that HRM takes care of the employees from ‘womb to tomb’. Different authors have expressed their opinions with regard to the scope of HRM in their own ways.
HRM utilizes other resources for effective designing and implementation of various policies, procedures, and programs. Human resource management has its gamut over the 3Ps of an organization, information technology (IT), strategic management, competency development, total quality management (TQM), performance management, leadership, change management, and other organizational phenomena such as economic boom or recession.
Scope # 1. HRM and 3Ps:
People, process, and performance are the three pillars of HRM, and are also termed as the 3Ps.
The 3Ps are described as follows:
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I. People:
It stands established that people are the core strength of an organization and that they are the only resources that appreciate unlike others, which depreciate. It is also known that all resources, except the human resource can be replaced.
We all know that people are guided by their emotions, and on nurturing, developing, and leading, they contribute their best. It is the human resource that can make or mar an organization. An organization is identified by its people, their behaviour, concerted efforts, team spirit, and helping attitude towards others. Thus, they must be carefully handled.
II. Process:
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Organizational processes are a set of interrelated activities which evolve over a period of time. Each process yields a product or a service. In a changing business environment, more emphasis is laid on flexibility and adaptability of any process.
In today’s times, product orientation has changed to process orientation. Products are manufactured through a process. If we concentrate on the process, the products are likely to be right. Engineers are required to design and develop these processes through which a product is manufactured or a service is delivered. HRM manifests its importance in equipping people to follow the process to achieve the business goals.
III. Performance:
An organization must create value and enhance its rate of return on investment (ROI) to move towards growth. It is a known fact that value creation and ROI enhancement are the two pillars of supporting performance in an organization. Manufacturing technology and information technology aid in marching towards excellence. Management of knowledge workers is different from that of managing other employees.
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This is because, knowledge workers, due to their intelligence and maturity, expect a greater degree of flexibility. They further deserve and prefer to work without interference as their independence motives are dominant. Their expectations are fulfilled through the requisite HRM tools. The HR needs to look at the performance of various workers from different perspectives for different functions.
Scope # 2. HRM and IT:
Management information system (MIS) has four levels, namely, office automation system (OAS), transaction processing system (TPS), MIS, and decision support system (DSS). Generally, the operating core of an organization works on OAS and TPS, managerial personnel use MIS, whereas the top management or strategic apex utilizes DSS for decision making.
Advancement of science and technology has paved the way for intensive use of information technology, which in turn has revolutionized the working of organizations. Business organizations are no exception to these phenomena.
IT is seen to be influencing and dominating the corporate world from three viewpoints. As everyone is using IT these days, it has become very important for any organization’s success. The HR departments need to update themselves with the latest IT tools and techniques.
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i. Information Technology Practices:
This refers to the extent of adoption and implementation of IT at various levels of managerial functions and the extent of infrastructure created to spread IT in order to support the business processes and operations.
ii. Information Management Practices:
Raw data is processed to yield information, which is then used for decision making. Once the decision has been taken and implemented, the information may or may not be referred back. Some of this information is retained for legal purposes. In a nutshell, information has its lifecycle. Information management practices denote the organizational capabilities to manage the entire information life cycle.
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iii. Information Behaviour/Values:
In organizations, willing acceptance of IT depends on the attitude and qualification of people, dimensions of organizational climate, motivation, and the age group of people. Attitude and qualification are subjective and general terms.
The twelve dimensions of organizational climate are orientation, interpersonal relationship, supervision, problem management, management of mistakes, conflict management, communication, decision making, trust, management of rewards, risk taking, innovation, and change. The six motives are achievement, expert influence, extension, control, dependency, and affiliation.
Higher-age groups generally tend to avoid the use of IT. Organizations where the average age of the people is less do not face this problem. However, HR personnel still need to work in close coordination with the IT personnel. The key challenge of the HR managers lies in identifying the information behaviour/values expected from the employees and in defining and communicating these to the employees.
Unless this is done, achieving results from the implementation of IT may remain unachieved or only partially achieved.
Another major factor common between HRM and the IT sector is the high rate of attrition.
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The most common causes of attrition in the IT sector are as follows:
a. Inability to use one’s competencies
b. Lack of challenging tasks
c. Mismatch of one’s expectations with the prevailing management style
d. Lack of scope of growth in terms of salary, status, and other factors
e. Absence of role clarity
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f. Lack of sense of belongingness
g. Rust out stress syndrome (ROSS)
h. Lack of learning opportunities
i. Low levels of motivation
j. Unfulfilled ‘occupational values’
k. Lifestyle inventory unmatched with the task
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l. Lack of excitement and innovation in the job.
The prime function of HR managers in the IT sector is identifying the causes behind attrition in that organization and initiating measures to prevent them.
Scope # 3. HRM and Strategic Management:
Strategic management is the process by which an organization formulates its strategies and implements them. Strategy is the route from the origin to the destination; the origin may be choosing a predefined objective and fulfilling the objective would be the destination. Strategic management encompasses the study of internal and external environments with a view to unearth and assess the relevant threats and opportunities.
This is clubbed with relentless appraisal of the organization’s strength and weaknesses, a thorough analysis of the strategic choices, and evaluation of each strategy. It allows an organization to base its decisions on long-range forecasts, and therefore benefits the organization with consistency of actions, thereby preventing a drift in different directions. Furthermore, strategic management creates an opportunity of involving different levels of management in the process.
Strategic management processes rely heavily on the leadership of organizational stalwarts. The managers responsible for implementing strategic management processes and the HR manager need to exhibit a requisite leadership style suitable for that situation. A leader effectively builds his/her team as a cohesive group and develops every member of the team to give his/her best. Leaders integrate the task needs and human needs, as their moral and organizational responsibilities.
Hence, HR managers need to concentrate on leadership development. They are required to work in association with the learning and development division, leadership development personnel to plan leadership development methods and techniques appropriate to the organizational situation. Organizations formulate short-term and long-term strategies. For the long-term strategies, HR managers should consider the leadership passage and be instrumental in developing an appropriate leadership pipeline.
Scope # 4. HRM and Competency Enhancement:
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Competencies refer to the managerial characteristics which are demonstrated and observable; these lead to effective and superior performance. Competency embodies the capacity to transfer skills and abilities to a person from one functional area to another. It also refers to exhibiting good performance more consistently.
Core competence is a bundle of skills and technologies that represents the enduring strength of a company and cannot be easily copied. The core competence of Larsen & Toubro is construction. Infosys has the capabilities of retaining people, developing leadership potential, and providing software solutions.
Haldia Petrochemical Limited has capabilities to provide polymers (polyethylene and polypropylene) and chemicals (products for energy segments and other industries) to the utmost satisfaction of the customers. It is the distinctive competence of people that helps the organization gain competitive advantages.
As an all-rounder, the HR manager needs to scan the business environment, finalize the business strategies, consider the available technology and infrastructure, and assess the competencies required for various positions. He/she needs to evaluate the employees, identify the competency gaps, and conduct development programmes to impart those competencies as well. This will help the organization to develop a suitable core competence and excel in the same.
Scope # 5. HRM and TQM:
Total quality management is a systematic customer-focused approach that is aimed at continuous performance improvement. It is a philosophy and a set of guiding principles, which represents the foundation for continuously improving the organization through employee involvement.
It is also an application of quantitative methods where human resources work towards improving the materials and services supplied to and by an organization. It also takes care of all the processes within the organization and the degree to which the needs of the customers can be met.
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TQM advocates the integration of fundamental management techniques, existing improvement efforts, and technical tools under a disciplined approach, thus resulting in continuous improvement. It emphasizes that the expectations of all the stakeholders must be met.
TQM is a company-wide perspective that strives for customer satisfaction by seeking zero defects in products and services. Making quality improvements was once thought to be the sole responsibility of specialists such as the quality engineers, product designers, and process engineers. Over the years, the concept has undergone a sea change. Today, developing quality across the entire company is an important function of the HRM department.
TQM embarks upon the ‘total quality person’, and to procure, develop, and retain them, one has to consider certain issues as follows:
i. Organizational chart and reporting
ii. Selection and recruitment
iii. Induction, grooming, and mentoring
iv. Setting goals and key result areas (KRAs)
v. Appraisal and performance measurement
vi. Growth, promotion, and compensation
vii. Impact of employee turnover
viii. Psychological contracts.
HR professionals perform many activities to enrich the quality movements of organizations and enhance the quality indices. At this juncture, HR manifests its importance to lend its helping hand to organizations and get the total quality from the people involved.
Scope # 6. HRM and Performance Management:
Performance concerns the behaviour directed towards achieving an organization’s missions and business goals, and manufacturing the products or services resulting from it. It refers to only that behaviour which is related to the production of goods or services maintaining the qualitative requirements. Performance differs from effectiveness, which generally involves making judgements about the adequacy of the behaviour with respect to certain criteria such as a work group or an organizational goal.
Performance is also considered to be a multidimensional variable being a conglomerate of several dimensions. Hence, people high on one dimension may not be high on the other, and such standings may change over time. Performance is effective and efficient work which also considers personal data such as measures of accidents, turnover, absence, and tardiness.
Performance index is the measure to determine if an executive’s salary is commensurate with the organization’s performance. Each employee of the organization is evaluated through a formal process on a regular basis.
The top individual strengths identified by Ramusson (1999) include ego strength, assertiveness, willingness to take risks, sociable and abstract reasoning, and healthy sense of skepticism, creativity, and empathy. Many psychologists and behavioural scientists are engaged in fundamental research to investigate the determinants of performance.
Pestonjee (1991) has mentioned about the global acceptance of high positive correlation between job satisfaction and performance. An organization cannot excel unless it focuses on the actions and behaviour of the human resources. Performance excellence is characterized by team-work, group cohesiveness, values, and value systems. These factors should be looked into for boosting productivity and attracting customers.
Performance excellence is also the congruence of employee output with the organizational goal. Job performance has causal relationships with factors such as assertiveness, job satisfaction, job involvement, and organizational commitment.
Assertiveness is social boldness; saying ‘no’ if the situation demands it. It also refers to the ability to express one’s own viewpoints without trampling upon others’ interests. Satisfaction in the workplace is just a constellation of attitudes about the job; the extent to which people like or dislike the various aspects of the work and the fulfillment of the requirement of an individual by the work environment.
Job involvement is the degree to which people identify themselves psychologically with the job; a high degree of involvement results in psychological empowerment. Organizational commitment is a state in which an employee identifies with a particular organization, its mission, policies, objectives, goals, and wishes to maintain membership in the organization.
HR managers should hold programmes in the organization to develop assertiveness. They should keep working towards measuring levels of satisfaction, involvement, and commitment, identify areas, and initiate actions for improvement.
Scope # 7. HRM and Leadership Development:
In organizations, there are administrators, managers, and leaders who perform various roles. Among them, leaders are usually the ones who excel, apply creativity, set trends, push benchmarks, engage in boundary management, extend vision, effectively network, are proactive, build culture, mentor followers, extend helping hands, multiply concepts of power, and empower the followers.
Of course, administrators and managers also do these jobs. Not all of us are born with the same potential to lead. However, it is important to remember that different characteristics can help or hinder in developing leadership competencies. Leaders have to be cognitive tuners, people catalysers, and efficacy builders.
Everyone in an organization can develop his/her leadership skills and effectiveness. Classroom- style training, workshops, and associated reading can also contribute to leadership skills, to know more about what he/she has in possession, what else is needed, and what is involved in leading efficiently.
Based on these perceptions and notions, organizations arrange leadership development programmes with objectives such as to provide the organization with the required number of leaders having the ability to meet the present and future organizational needs, to instill leadership capabilities among the managers, to inculcate a sense of self-dependency, achievement, and affiliation to team members, to encourage the leaders to keep themselves up to date, and grow to meet the challenges, cope up with the changes, handle complex situations and greater problems, to discharge their responsibilities with improved performance, and to sustain good performance and gain distinctive competence.
The HR professionals need to organize leadership development programmes to meet the organizational needs. The programmes may be organized in phases and consist of project works between two phases. Different situations and different persons function and work better under different leadership styles.
HRM plays a predominant role in identifying the leadership styles that would be best suited for getting the work done by others. The contemporary leadership styles practiced in organizations are transactional, transformational, and charismatic leadership. Value-based leadership, spiritual and servant leadership, boundary spanning, and team leadership are the other styles.
Human resource management especially helps in building the leadership pipeline in organizations. Furthermore, succession planning is an essential need when a significant person approaches superannuation.
Scope # 8. HRM and Change:
Business scenarios have been changing continuously due to multiple reasons such as changes in social, economic, and cultural settings. There are a number of similar factors that affect organizations, compel them to anticipate changes and implement relevant actions to cope with them, survive, and grow.
Change management has become the most vital area while running a business or managing an organization; it is probably the most difficult one too. One needs to identify the change, ascertain the state to be moved to, initiate proactive steps, manage resistance, move to accommodate change, and refreeze again to gain competitive advantages. For many, the general tendency is to be complacent with policies and practices that have been successful in the past.
A cursory glance at the history of many of the successful organizations indicates that organizations that have been adaptive and change-oriented continue to be successful. Organizations need to continuously scan the environment, study the changes, analyse their pace and direction, interpret them in the context of the organization, and plan the changes essential to survive and grow. Many organizations have perished as they could not study the changes or could not implement the changes in a planned manner.
Organizations today are facing challenges due to reasons that have emerged from new business needs such as the following:
i. Technology facilitating working of virtual teams
ii. Customers demanding round-the-clock service
iii. Working in a global village requires 24 x 7 support to attend to queries
iv. Blurring of the geographical borders with the formation of the virtual world.
HRD was originally only a staff function. Following strategic shifts, it has now become a line function. As a strategic function, it has to coordinate with other functional areas and gear up the human resources to meet the future challenges. Therefore, HR bears the arduous task of convincing the top management to support, initiate, and sustain change management programmes.
Jyothi and Venkatesh (2008) have mentioned certain challenges faced by an HR with regard to change management as follows:
i. Facilitating the work-life balance for employees
ii. Facilitating culture change for employees
iii. Competence mapping and building
iv. Preparing career plans
v. Managing attritions
vi. Managing cultural diversity
vii. Sustaining and improving the productivity and creativity
viii. Reorienting the organizational practices and policies to suit the new generation employees.
In the context of work-life balance, the employees have to achieve a balance among work, home, and community. In such cases, the HR personnel have to intervene to discharge the responsibility of facilitating these employees through pragmatic awareness programmes, facilitating their thinking about organizational work and non-organizational work life, educating the managerial personnel to coach, mentor, and counsel their employees, and extending professional counselling directly by the trained HR personnel for struggling employees.
In the arena of change management, HR professionals have to act as change champions. They have to convince the people by explaining the need for the changes, the consequence if the change is not implemented, and the expected benefits out of the changes.
They are required to constantly evaluate the effectiveness of the results of the organizational efforts. Both knowledge and distinctive ability to execute successful change strategies make the HR professional exceptionally valued. They need to know how to link change to the strategic needs of the organization with minimal employee dissatisfaction and resistance to change. When they start implementing changes, they no more remain ‘change agents’; they become ‘change champions’.
Scope # 9. HRM during Other Organizational Phenomenon:
This millennium has witnessed an acute economic recession. The business situation has observed an economic boom as well. Different companies have had to adopt diverse HRM practices in the various situations to survive and grow.
I. HRM during Economic Recession:
Tough times call for tough measures; H R managers need to figure out ways to deal with their employees and hold on to them. They have to make sure that they stay within the budget at all times. It has already been established that an organization is as good as its people.
The driving force behind one’s business is good employees who perform and contribute to the organization. In the period of recession, the performers are not expendable. Thus during tough economic times, an organization has to retain its performing people with itself and away from its competitors.
At this juncture, HR managers need to adopt some practices.
These are described as follows:
a. Discriminate among Star, Good, and Average Employees:
The HR manager needs to check the performance and potential of all the employees. This is required in order to identify the capabilities of all the employees and categorize them.
i. Deadwood:
In any organization, one will find that 80% of the employees (passengers) do 20% of the work, and the rest 20% (performers) do the remaining 80% of the work. The passengers are incompetent, unsatisfactory, and unsuitable occupants of their positions, and are unable to perform their roles.
ii. Problem Child:
There are examples of persons with great potential to work and capable of contributing significantly to the organization, but do not use their genuine capacities; rather they work below their capacity or only with mixed results. It must be evidenced that in some instances, they divert their energies to make mischief, indulge in harmful activities, and get easily influenced by external agencies. They are simply wasting their talents. This type of employee is called the problem child.
iii. Work Horse:
The work horses have limited capacity but they invest a lot of efforts and try to accomplish the tasks entrusted to them. These are the people who actually reach the peak of their performances. Reddy (2005) found in his study that 75% out of more than 200 managers at the Kerala state level public enterprises belonged to this category.
iv. Star:
These members of the organization have high potential and high performance levels. They are performers responsible for the growth of the organization. Around 15% of the employees in the managerial cadre belong to this classification.
During recession, an organization needs the star employees to brave out the recessionary storm, and for that one will have to use the most valuable weapons from one’s arsenal. The weapons may be organization-specific. The bad ones, particularly those in the problem child category, will turn out to be bigger liabilities once the pressure to perform inevitably increases.
b. Redirect Employees to Other Departments:
One of the best ways to retain employees is through job rotation. Considering their competencies and the job attributes, they can be transferred to other departments. One central benefit of job rotation is to understand the processes. In the case of executives, job rotation facilitates understanding the business.
This can be done periodically and the frequency can be defined in the company’s administrative manual to avoid resistance from employees. For example, if there are too many sales people handling too few sales in a week in an area, then they can be redirected to another area.
The employees will acquire additional skills while working in different departments. However, the best salespeople of the star category would be required in the sales department, as sales strategy would still need attention in order to enhance sales. Job rotation is required at all functional areas of an organization.
c. Listen to the Employees:
This is a very important aspect that every HR manager must be good at. By listening to the grievances of the employees, one not only gains their trust and confidence but also encourages them to do the tasks efficiently.
d. Keep them Motivated and Engaged:
During lean times, employees feel insecure. There arises a need to keep all the employees occupied and busy. Many companies organize training sessions and outstation trips for the employees to make them feel busy, motivated, and happy.
e. Highlight the Company’s Position:
One must lay your cards on the table to show up the company’s position. During meetings with the employees, the HR manager should paint a clear picture. Explain to them that the recession has forced the organization to take some harsh steps and their cooperation is required. Their concerted efforts are inescapable for the survival and growth of the company. Being open and upfront with the staff from the very beginning will help prevent the key employees to jump from the ship.
All the steps mentioned here are likely to enable an HR manager to hold his/her team together during a recession, to make the interpersonal bond stronger, and to inculcate team spirit. The employees will be motivated and their commitment will enhance. It is necessary to be understanding during tough times and put in the extra efforts required for the business to come out of the storm unscathed.
II. HRM during Economic Boom:
During an economic boom, some companies may become complacent. A company may even initiate special ventures. For example, it can analyse the competition in the market, launch new products to enlarge the product range, penetrate into new markets, assess the organization for change and development, concentrate on people development, talent acquisition, and retention, and perform many such activities.
The company can also do so by investing a major share of the profit earned in the business itself. In a booming economy, a company can further think of reviewing and redesigning the compensation packages.
Presently, HR is treated as a business partner.
In the time of economic boom, HRM should function by taking into consideration the following points for better results:
1. Business expansion—new and specific skills can be imparted to employees.
2. Fund availability—a major share of the profit can be reinvested in the business for modernization.
3. Compensation packages—the existing system can be reviewed and innovative systems can be launched.
4. Companies can carry out SWOT analysis and identify strategies to beat competitors.
5. Funds in developing human resources can be utilized to impart need-based training and conducting management development programmes.
6. Employee retention can be ensured by attitude surveys, satisfaction measurement, and initiating remedial measures (even if retention cannot be eliminated, it can be greedy reduced).
Tremendous attention, of course, is required to increase the talent pool available in the marketplace through various options as follows:
1. Hiring foreign workers
2. Supporting vocational courses
3. Encouraging greater enrollment in apprenticeship programs
4. Extending the work-life span by delaying retirement of older workers.
All these options are unparalleled and inevitably bear fruit in the long term. In the short term, however, an employer can still face crisis.
Out of these, acquiring and retaining talents must be an on-going exercise, during this period. For retaining valuable employees, a company has to pay utmost attention. The probability of poaching by competitors is likely to be more during the time of economic boom. Retaining one’s existing employees, if they are adjudged right, is one of the most critical ways to accelerate the growth during the economic boom.
If employees can be retained, huge savings can be made on recruitment costs, valuable time, and energy, and these resources can be redirected back to the core business, thus truly taking advantage of the booming economy.
Apart from financial packages, companies can adopt certain non-financial means, both to attract and retain people.
There are numerous strategies that companies can undertake, a few of which are discussed here:
1. Creating a convincing vision, mission, and purpose – A structured and documented vision statement helps a company to attract talent. Furthermore, it aids to enhance their continuous commitment. The vision and mission greatly reduces employee attrition. Employees should also know the purpose of existence of the company. The vision, mission, and, purpose statements must be communicated and explained to all employees.
2. Providing opportunities for training, learning, and development – Stagnant employees who get bored and are unchallenged tend to leave the organization. Opportunities for continuous learning and development motivate them and bring out the best in them.
3. Managing to focus on individual strengths – Employees’ strengths and weaknesses may widely differ and hence they must periodically be identified. Employees must be helped to take care of their weaknesses in addition to focusing on their strong points.
4. Managing stress – A stressed employee cannot contribute his best to the company. Various types of organizational role stresses need identification and suitable remedial actions.
An organization’s greatest asset is its employees, and hence, it is important to take care of their needs.
Scope of Human Resource Management – Scope and Prospect of Human Resource Management in an Organization
Human Resource Management aims at developing head, hands and heart of every individual working in an organisation. The objectives of any organisation can be met only by people who are competent and motivated. It is the job of the management to select the right type of people for the right jobs and at the right time, sharpen their skills and abilities, and motivate them to give their best to the jobs and the roles assigned.
The scope of HRM is immense for any organization plying in today’s dynamic business environment. The entire process starts right from the manpower planning process and revolves around an organization’s hiring practices, employee and executive motivation, maintenance, performance evaluation and compensation management, industrial relations and the employee retention plans and strategies.
In case of a successful and fast growing company like ICICI Prudential Life Insurance, the scope of its HR function is clearly revealed from its HR philosophy.
The pervasive feature of human resource management makes its scope and applicability wider. Further the strategic role of HRM function and HR professionals now assuming the roles of strategic partners in the organization had further enhanced the scope of the HR function in the organization.
1. Employee Hiring:
Having the right employee at the right place is a challenge to any organization. Particularly when the rival organizations are attempting to poach away the best employees of one organization, it has become strategically crucial for today’s HR managers to hire and retain their intellectual capital. This is facilitated by a comprehensive HR planning and a watch dog policy on rival organization’s HR strategies.
2. Compensation Management:
Compensation management is one of the most important factors contributing to employee retention in today’s organizations. When most of the firms are depending on their respective variable pay packages to attract talents and lure others from rival organizations, it is imperative that HR managers need to emphasize on a comprehensive compensation strategy.
3. Employee Motivation:
Retaining employees in the era of cut throat competition is hugely contributed by the extent through which employees are being motivated at their workplace. HR professionals have to play an instrumental role in creating a conducive environment at the workplace so as to facilitate constant learning, growth and employee development.
At the same time there has to be an equal emphasis on enhancing the Quality of Work Life (QWL) and the overall ambience in the organization so as to enhance the psychological wellbeing of employees in their workplace.
4. Employee Maintenance:
Today’s HR managers go beyond the traditional “maintenance oriented” approaches towards a more holistic and developmental approach for nurturing their human capital. Organizations in this pursuit have emphasized on developing “assessment centres” and “growth laboratories/employee incubators” so facilitate holistic learning and development in the workplace.
5. Industrial Relations:
Today’s HR functions had gone well beyond the traditional union-management conflict resolution platform to a more holistic and wide scenario. With majority of the organizations going global, the challenges of IR had been further complicated in terms of dealing with the labour laws and regulations of multiple countries where they operate.
Further with employee empowerment creeping into the blood of most organizations and grooving importance being laid upon self-managed teams and quality circles, the relevance of unionism seemed to have been faded.
Prospects of HRM:
This mainly includes emphasis on a broader outlook towards the people working in the organization.
Issues include those of-
(i) HR functions assuming the role of strategic partners in the organization
(ii) HR managers assuming the roles of “change agents” and “internal organizational development (OD) consultants”
(iii) More involvement in to the personal lives of employees
(iv) Focus on employee diversity management
(v) Emphasis on cross-cultural assimilation and training
(vi) Emphasis on constant employee development and learning
(vii) Emphasis and strategic focus on employee career planning and development
(viii) Developing the next line of competent managers as a part of the organization’s succession plan
(ix) Performance management systems of organizations being linked with the strategic objectives of the organization
(x) Focus on developing employee capabilities rather than developing skills through conventional training activities.
Scope of Human Resource Management – Activities Included in HRM: Procurement, Training & Development, Job Analysis & Job Description, Remuneration and Few Others
HRM has a wide scope as all the major activities in the working life of a worker, from the time of his or her entry into an organization until he or she leaves, come under the purview or range of HRM.
The following activities are included in HRM:
1. Procurement
2. Training and Development
3. Job Analysis and Job Description
4. Remuneration/Rewards
5. Personnel Records
6. Welfare
7. Industrial Relations
1. Procurement:
It is the recruitment and selection procedure to select personnel for the various posts in the organisation. It has the following aspect- (i) Proper determination of manpower requirements, (ii) Proper job analysis, (iii) Proper nature and scope of recruitment, (iv) Proper employees selection, and (v) Placement of employees.
2. Training and Development:
Training and development is indispensable to prepare the employees for the actual management situations. Employees’ participation in committees and board meetings may also contribute towards their development.
3. Job Analysis and Job Description:
Job analysis and job description comprises of the study of job requirements of the enterprise and assignment of well-defined functions to jobs, so that qualified employees may be hired for such organisation. It also forms the basis of wage determination.
4. Remuneration / Rewards:
Provision of adequate remuneration for the work done by an employee involves job analysis and job evaluation. It includes determining the following wage rates, incentive systems of wage payment, merit-rating and performance appraisal.
5. Personnel Records:
The personnel records are used for collecting bio-data of all employees pertaining to their respective work, e.g., training job performance, aptitude payment records.
6. Welfare:
Welfare includes health and safety programme, sanitary facilities, recreational facilities, group insurance employee associations, working conditions, housing, transport, education, safety, etc.
7. Industrial Relations:
Industrial relations are inclusive of various aspects like collective bargaining, participative management, dispute settlement, grievance redressal, etc.
Activities of HRM:
Some of the activities which are included are as follows:
(i) Training and Development – It helps the human resource to have a proper knowledge, skills and attributes to further organizational and personal goals. Development helps the managerial talent through appropriate programmes.
(ii) Organization – Helps in arranging the things in a systematic manner so that the goals can be achieved in a proper time.
(iii) Human resource planning – The process by which management determines how an organization should move from its current manpower position to its desired manpower position.
(iv) Selection – It is basically choosing the most suitable persons out of all the applicants. It is the process of matching the qualification of applicants with the job requirements.
(v) Compensation – It refers to providing equitable and fair remuneration of employees for their contribution to the attainment of organization objectives.
(vi) Motivation – Solving problems of the employees and encouraging them to work enthusiastically.
(vii) Employee Maintenance – Try to have stability in the organization so that proper work environment can be created.
Scope of Human Resource Management – Classification of the Scope: HRM in Personnel Management, HRM in Employee Welfare, HRM in Industrial Relations & Few Others
HRM is the planning, organising, directing and controlling of the procurement, development, compensation, integration, maintenance and separation of human resources to the end that individual, organisational and social objectives are accomplished.
Thus, HRM is concerned with the people dimensions in the management and looks after both the qualitative and quantitative aspects of human resources of an organisation. It is basically concerned with acquiring the manpower for the organisation, developing its skills and competencies, motivating its commitment and retaining it. HRM is primarily concerned with how to make people at work more productive and contented.
HRM is very wide in scope. It includes all the major activities in the working life of an individual starting from his entry into the organization till he leaves the organization.
Traditionally, Human Resource Management was a simpler process but with increase in industrialisation, it has grown to be a much specialised field.
The scope of HRM may be classified under the following heads:
1. HRM in Personnel Management:
This aspect of HRM deals with manpower management. HRM strives to achieve organizational development through individual growth and development of workers.
It includes the following functions:
(i) Manpower planning, recruitment and selection – It is the responsibility of the HR department to plan for future manpower requirements, recruit candidates and select the most suitable candidate for the job vacancy.
(ii) Induction and orientation – The newly joined employees have to be introduced into the organization and made familiar with the workplace and other employees in order to help them in adjusting to the new surroundings.
(iii) Training and development – This is the function of training the employees to develop their skills, knowledge and capabilities so that they become more productive.
(iv) Transfer and promotion – The employees of an organization may be transferred to other branches or promoted to a senior level based on the organizational requirements.
(v) Compensation – The HR department decides the method of rewarding the employees for their contribution to the organization. The compensation should be able to attract and motivate the employees towards giving their best.
(vi) Lay-off and retrenchment – The functions of HR include not just the recruitment and selection of staff, but also lay-off and retrenchment of workers, i.e. discharge of workers from the organization, either temporarily or permanently during times of economic difficulties.
(vii) Performance appraisal – The performances of the employees at all levels have to be assessed to measure their efficiency and to motivate them towards better performance. This is another important function of HRM.
(viii) Career development – HRM helps the employees to plan and develop their career. They are provided career counselling and informed of new opportunities for growth inside the organization.
2. HRM in Employee Welfare:
Employee welfare deals with the working conditions and facilities at the work place. The aim of employee welfare is to take care of employees’ safety and medical needs and provide them comfortable working conditions.
It includes:
(i) Medical facilities – It is mandatory that the employees of an organization be provided with medical care and sickness benefits whenever required.
(ii) Eliminating workplace hazards – Safe working conditions should be provided to the employees. Any machinery or equipment that might cause physical injury should be removed from the workplace.
(iii) Proper ventilation and lighting – Good working conditions are conducive to employees’ physical health and productivity. The work premises should be properly ventilated and well lit for their comfort.
(iv) Sanitation facilities – Hygienic washroom facilities are to be maintained to protect the employees’ health and well-being.
(v) Safeguarding machinery – Machineries should be equipped with enough safety mechanisms so that no one is injured while operating them.
(vi) Employment injury benefits – In case any worker gets injured or disabled in the factory premises while working, he should get the necessary injury benefits that he is entitled to.
(vii) Maternity benefits – Female employees should be allowed maternity leaves and other benefits as per the legal requirements.
(viii) Canteen facilities – Mess and canteen facilities where employees can get eatables and drinks should be available at the workplace.
(ix) Crèches – This is applicable at workplaces where a large number of women are employed. There should be crèche facility for safely leaving small kids while the mothers are busy working.
3. HRM in Industrial Relations:
Industrial relations refer to the collective relationship between management, employees and government in any organization. For the maintenance of harmonious industrial relations it is necessary to have frequent interactions with labour unions, address their grievances and settle the disputes effectively.
The problems should be solved with joint consultations and collective bargaining. Mutual understanding and goodwill should be promoted between the employer and the unions. It is about establishing open communication and industrial democracy to safeguard the interests of both the management and the employees.
Main Areas Coming under the Scope of Human Resource Management:
(1) Forecasting and determination of manpower requirements of the organisation, especially keeping in view the fast changing technology and the requirements of competitive markets.
(2) Conducting job analysis for determining the requirements of different jobs and ascertaining the personal traits needed.
(3) HR planning and forecasting, candidates sourcing, recruitment, selection, placement and induction.
(4) Training and development.
(5) Wage and salary administration including forms of compensation, compensation policy, job evaluation, components of compensation, requirements of wage legislation and incentive payments.
(6) Fringe benefits and social security provisions.
(7) Performance appraisal.
(8) Workforce adjustment such as promotion, transfer and redundancy.
(9) Disciplinary matters and grievance settlement.
The specific areas of operation of human resource departments in different organisations have varied. In most cases, more attention has increasingly been paid on employee relations, performance appraisal, skill-development and adjustment of workforce. In addition, human resource management has brought under its coverage managerial personnel and even higher echelon of executives.
A notable feature of human resource management today is sharing of experiences of successful reputed firms in specific areas and mutual exchange of strategies and tools, both within the country and abroad.
Scope of Human Resource Management – As Described by Indian Institute of Personnel Management
The scope of HRM is vast. HRM is not limited to the activities concerning employment and retention of people. It has a wide area the coverage of which starts from forecasting and vision exercise, for HR demands of the organization till exit of the personnel including activities during intervening process.
The scope of HRM has recently increased due to sudden technological advancement, increase of knowledge workers, changes in perception of employees about management activities, change in employee expectation, needs, requirement, work environment, organizational culture, changes in business strategy due to government’s policy on LPC and the need for taking all measures to make the people at work dynamic to face the competition.
So, in the changing economic scenario the scope of HRM extends vastly as every organization needs dynamic workforce to produce quality goods and to deliver the same to delight the customers.
According to Dale Yoder, the scope of Human Resource Management is very wide.
It consists of the following functions:
I. Setting general and specific management policy for organisational relationships, and establishing and maintaining a suitable organisation for leadership and cooperation.
II. Collective bargaining, contract negotiation, contract administration and grievance handling.
III. Staffing the organisation, finding, getting and holding prescribed types and number of workers.
IV. Aiding in the self-development employees at all levels providing opportunities for human resource development and growth as well as for acquiring requisite skill and experience.
V. Developing and maintaining motivation or workers by providing incentives.
VI. Reviewing and auditing manpower management in the organisation.
VII. Industrial relation research carrying out studies designed to explain employee behaviour and thereby effecting improvement in manpower management
The Indian Institute of Personal Management has described the scope of human resource management into the following aspects:
1. The Labour or Human Resource Aspect:
It is concerned with manpower planning, recruitment, selection, placement induction, transfer, promotion, demotion, termination, training and development, layoff and retrenchment, wage and salary administration (remuneration), incentives, productivity, etc.
2. The Welfare Aspect:
This aspect is concerned with working conditions and amenities such as canteens, crèches, rest rooms, lunch room, housing, transport education, medical help, health and safety, washing facilities, recreation and cultural facilities, etc.
3. The Industrial Relations Aspect:
This is concerned with the company’s relations with the employees. It includes union-management relations, joint consultation, negotiating, collective bargaining, grievance handling, disciplinary actions, settlement of industrial disputes, etc. All the above aspects are concerned with human element in industry as distinct from the mechanical element.
The scope of human resource management has expanded considerably in recent decades. Now, techniques and styles or managing human resources, research in behavioural science, establishment of training institutes, etc. have contributed to the expansion of human resource function. Human resource management is no longer confined to wage earners in factories. It has become equally significant in offices, hospitals, government etc.
In India, human resource management now consists of three main branches:
(a) Human resource administration which deals with administrative duties such as selection, placement, training, promotion, transfer, wage and salary administration, etc.;
(b) Industrial relations concerned with employer- employee relations, negotiations, collective bargaining, grievance redressal, dispute and joint consultation; and
(c) Labour welfare consisting of facilities like canteen, creches, housing, education, medical aid, recreation, etc.
Scope of Human Resource Management – Scope and Various Aspects of Human Resource Management
The scope of human resource management is pervasive enough. HRM refers to all the activities that come under the banner of managing human resource. Most of the subjects, which have hitherto been coming under the purview of personnel management, have also come under the ambit of human resource management. There has, however, been a shift in priorities in particular areas, approaches, strategies and tools.
In addition, a few new areas such as employee relations, employee development, talent management and career plans have increasingly come to be given major emphasis. The main areas coming under the purview of human resource management are described below-
(i) Human resource or manpower planning i.e., determining the number and kinds of personnel required to fill the vacant position in an organisation.
(ii) Recruitment, selection and placement of human resource i.e. employment function.
(iii) Training and development of employees in effective manager for their efficient and performance and growth.
(iv) Performance appraisal of employees and taking corrective measures accordingly like transfer, promotion etc. for the better working of the organisation.
(v) Motivation of workforce by providing financial incentives and avenues of promotion.
(vi) Remuneration of employees, should be given by a proper monetary and maintaining compensation plan.
(vii) Social security and welfare of employees.
(viii) Review and audit of personnel policies, procedures and practices of the organisation.
So it is very clear that the scope or activities of human resource management is very vast. This HRM is also termed as ‘labour management’, ‘manpower management’, ‘Human relations’, and so on.
Various aspects of HRM are:
This encompasses the following:
1. Manpower forecasting and planning.
2. Recruitment- ‘Selling’ the organisation for prospective employees.
3. Selection- Screening of employees through tests, interview etc.
4. Placement and Transfer- Putting the right people in the right job.
5. Training and Development.
6. Promotion and Rewards.
7. Maintenance- Compensation through incentives.
8. Separation- Voluntary retirements or Superannuation.
9. Lay-offs and Retrenchment.
These include:
1. Working conditions.
2. Safety measures.
3. Canteen, Creches and Rest/Lunch rooms.
4. Housing and Transport facilities.
5. Medical assistance.
6. Education for self and children.
7. Recreation facilities for physical and mental health.
III. Social Security Measures Aspect:
This aspect covers:
1. Employees’ Provident Fund.
2. Insurance.
3. Gratuity and Pension.
4. Job for dependents on retirement/death.
IV. Industrial Relations Aspect:
This is related to:
1. Trade union-Management relation.
2. Labour laws.
3. Collective bargaining.
Miscellaneous but important functions of HRM:
1. Human Resource Information System.
2. Financial Impact of HRM.
3. Equal Opportunity, Ethics and Fair Treatment.
4. High Performance Work System to meet the challenges.