1. THE STRATEGIC ROLE OF HUMAN RESOURCES MANAGEMENT
EXCEL BOOKS
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Chapter 1
THE STRATEGIC ROLE OF
HUMAN RESOURCES MANAGEMENT

2. ANNOTATED OUTLINE Introduction
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ANNOTATED OUTLINE
Introduction
Organisations have to provide a healthy work climate in order to get the best out of people. To utilise the capabilities of people fully, you need competent leadership willing to recognise, reward and nurture talent at all levels. This is where human resource managers play a critical role by bridging gaps between employee expectations and organisational requirements by adopting appropriate human resource strategies and practices. HRM, in short, is the art of procuring, developing and maintaining competent workforce to achieve the goals of an organisation in an effective and efficient manner.
The Strategic Role Of Human Resources Management

3. Human Resource Management: Features
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Human Resource Management: Features
Pervasive force
Action oriented
Individually oriented
People oriented
Future oriented
Development oriented
Integrating mechanism
Comprehensive function
Auxiliary service
Inter-disciplinary function
Continuous function
The Strategic Role Of Human Resources Management

4. Important terms Clearing the Fog
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Important terms
Clearing the Fog
Human resource: Knowledge, skill sets, expertise of employees, the adaptability, commitment and loyalty of employees.
Skills: The individual abilities of human beings to perform a piece of work.
Resource: The stock of assets and skills that belong to a firm at a point of time.
Capability: The ability of a bundle of resources to perform an activity; a way of combining assets, people and processes to transform inputs into outputs.
Core competencies: Activities that the firm performs especially well when compared to its competitors and through which the firm adds value to its goods and services over a long period of time.
Competitive advantage: It comes from a firm's ability to perform activities more distinctively and more effectively than rivals. To attain competitive advantage, firms need to add value to customers and offer a product or service that cannot be easily imitated or copied by rivals (Uniqueness).
Value: Sum total of benefits received and costs paid by the customer in a given situation.
The Strategic Role Of Human Resources Management

5. Scope of HRM HRM mainly covers three broad areas Personnel aspect
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Scope of HRM
HRM mainly covers three broad areas
Personnel aspect
Welfare aspect
Industrial relations aspect
The Strategic Role Of Human Resources Management

6. Objectives of HRM Importance of HRM
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Objectives of HRM
HRM aims at achieving organisational goals, meet the expectations of employees; develop the knowledge, skills and abilities of employees; improve the quality of working life and manage human resources in an ethical and socially responsible manner.
Importance of HRM
From an organisational standpoint, good HR practices help in attracting and retaining talent, train people for challenging roles, develop their skills and competencies, increase productivity and profits and enhance standard of living
The Strategic Role Of Human Resources Management

7. Importance of HRM attract and retain talent
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Importance of HRM
attract and retain talent
train people for challenging roles
develop skills and competencies
promote team spirit
develop loyalty and commitment
increase productivity and profits
improve job satisfaction
enhance standard of living
generate employment opportunities
Good HR Practices help
The Strategic Role Of Human Resources Management

8. HRM as a central subsystem in an organisation
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HRM as a central subsystem in an organisation
Product Subsystem
HR Subsystem Procurement Training Compensation Appraisal Rewards
Finance Subsystem
Marketing Subsystem
Technical Subsystem
The Strategic Role Of Human Resources Management

9. Functions of HRM P/HRM Operative Functions Managerial functions:
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Functions of HRM
P/HRM
Operative Functions
Managerial functions:
Procurement
Job Analysis
HR planning
Recruitment
Selection
Placement
Induction
Internal mobility
Development:
Training
Executive development
Career planning
Succession
planning
Human resources development strategies
Motivation and Compensation:
Job design
Work scheduling
Motivation
Job evaluation
Performance and potential appraisal
Compensation administration
Incentives benefits and services
Maintenance:
Health
Safety
Welfare
Social security
Emerging Issues:
Personnel records
Personnel audit
Personnel research
HR accounting
HRIS
Job stress
Mentoring
International HRM
– Planning
– Organising
– Directing
– Controlling
Integration:
Grievances
Discipline
Teams and teamwork
Collective bargaining
Participation
Empowerment
Trade unions
Employers’ associations
Industrial relations
The Strategic Role Of Human Resources Management

10. Strategic Human Resource Management
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Strategic Human Resource Management
Competitive advantage through people?
Competitive advantage allows a firm to gain an edge over its rivals when competing. It comes from a firm’s unique ability to perform activities more distinctively and more effectively than rivals. HR can be a source of competitive advantage when the talents of people working in the firm are valuable, rare; difficult to imitate and well organised to deliver efficient and effective results.
The Strategic Role Of Human Resources Management

11. The evolving strategic role of Human Resource Management
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The evolving strategic role of Human Resource Management
Strategic focus
Strategic partner Change agent
System
People
Administrative expert Employee champion
Operational focus
The Strategic Role Of Human Resources Management

12. Strategic Human Resource Management
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Strategic Human Resource Management
Realising the growing importance of HR, a new line of thinking emerged elevating the status of HR to that of a strategic partner both in the formulation of a firm’s strategic as well as in the implementation of business activities. SHRM, simply stated, is the linkage of HRM with strategic goals and objectives with a view to improve business performance and develop organisational cultures that foster innovation and flexibility. Strategic HR differs radically from traditional HR in a number of ways:
The Strategic Role Of Human Resources Management

13. Traditional HR vs. Strategic HR
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Traditional HR vs. Strategic HR
Point of distinction
Focus
Role of HR
Initiatives
Time horizon
Control
Job design
Key investments
Accountability
Responsibility for HR
Traditional HR
Employee Relations
Transactional change follower and respondent
Slow, reactive, fragmented
Short-term
Bureaucratic-roles, policies, procedures
Tight division of labour; independence, specialisation
Capital, products
Cost centre
Staff specialists
Strategic HR
Partnerships with internal and external customers
Transformational change leader and initiator
Fast, proactive and integrated
Short, medium and long (as required)
Organic-flexible, whatever is necessary to succeed
Broad, flexible, cross-training teams
People, knowledge
Investment centre
Line managers
The Strategic Role Of Human Resources Management

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EVOLUTION OF HRM
The field of HRM evolved both in India and elsewhere over a number of years to present level of sophistication and use of proactive methods
The industrial revolution
Scientific management
Trade unionism
Human relations movement
Human resources approach
The Strategic Role Of Human Resources Management

15. Evolution of the Personnel Function
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Evolution of the Personnel Function
Concept
What is it all about?
The Commodity concept
Labour was regarded as a commodity to be bought and sold. Wages were based on demand and supply. Government did very little to protect workers.
The Factor of Production concept
Labour is like any other factor of production, viz, money, materials, land, etc. Workers are like machine tools.
Welfare measures like safety, first aid, lunch room, rest room will have a positive impact on workers’ productivity
The Goodwill concept
The Paternalistic concept/ Paternalism
Management must assume a fatherly and protective attitude towards employees. Paternalism does not mean merely providing benefits but it means satisfying various needs of the employees as parents meet the requirements of the children.
Cont…
The Strategic Role Of Human Resources Management

16. Evolution of the Personnel Function
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Evolution of the Personnel Function
The Humanitarian concept
To improve productivity, physical, social and psychological needs of workers must be met. As Mayo and others stated, money is less a factor in determining output, than group standards, group incentives and security. The organisation is a social system that has both economic and social dimensions.
The Human Resource concept
Employees are the most valuable assets of an organisation. There should be a conscious effort to realise organisational goals by satisfying needs and aspirations of employees.
The Emerging concept
Employees should be accepted as partners in the progress of a company. They should have a feeling that the organisation is their own. To this end, managers must offer better quality of working life and offer opportunities to people to exploit their potential fully. The focus should be on Human Resource Development.
The Strategic Role Of Human Resources Management

17. Growth in India Legal phase Welfare phase Development phase
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Growth in India
Legal phase
Welfare phase
Development phase
The Strategic Role Of Human Resources Management

18. Personnel Function in India; Changing Scenario
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Personnel Function in India; Changing Scenario
Period Emphasis Status Roles
1920 – 30 Welfare management Clerical Welfare Paternalistic practices administrator
1940 – 60 Expanding the role to cover Administrative Appraiser Labour, Welfare, Industrial Advisor Relations and Personnel Mediator Administration Legal advisor Fire fighting
1970 – 80 Efficiency, effectiveness Developmental Change agent dimensions added Integrator Emphasis on human Trainer values, aspirations, Educator
1990s – Incremental productivity Proactive, Developer onwards gains through human growth-oriented Counsellor assets Coach Mentor Problem solver
The Strategic Role Of Human Resources Management

19. Shifts in HR management in India
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Shifts in HR management in India
Emerging HR practice
Strategic role
Proactive
Key part of organisational mission
Service focus
Process-based organisation
Cross-functional eams, teamwork most important
People as key investments/assets
Traditional HR practice
Administrative role
Reactive
Separate, isolated from company mission
Production focus
Functional organisation
Individuals encouraged, singled out for praise, rewards
People as expenses
The Strategic Role Of Human Resources Management

20. HRM in the new millennium
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HRM in the new millennium
Current thinking in HRM strongly supports the view that when opportunities for growth and enhancement of skills are available in an organisation, people will be stimulated to give their best, leading to greater job satisfaction and organisational effectiveness. To this end, therefore, HR managers in the new millennium are expected to successfully evolve an appropriate corporate culture, take a strategic approach to the acquisition, motivation and development of human resources and introduce programmes that reflect and support the core values of the organisation and its people.     
v    Size of work force
Demands for better pay, benefits, working conditions
Cont…
The Strategic Role Of Human Resources Management

21. HRM in the new millennium
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HRM in the new millennium
Composition of workforce Equal pay for equal work
Breaking down of glass ceiling
Constitutional protection to minority groups
Importance to factors such as age, sex, religion, region, caste especially while dealing with multifarious, heterogeneous, culturally diverse work groups
Employee expectations
Better educated, more knowledgeable, emotionally strong and demanding workforce
Demand for educated, trained, experienced and knowledgeable workers growing
Understand individual differences and develop appropriate policies to meet their growing expectations.
Cont…
The Strategic Role Of Human Resources Management

22. HRM in the new millennium
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HRM in the new millennium
Changes in technology
Modernisation, computerisation, sophistication increasing by the day
Knowledge and skills need to be refined constantly
Training, retraining and mid-career counselling important
Equip employees so as to cope with dramatic challenges brought forward by rapid advances in science and technology
  Life style changes
Environmental challenges
Personnel function in future
Job redesign
Career opportunities
Productivity
Recruitment and selection
Training and development
Rewards
Safety and welfare       
Cont…
The Strategic Role Of Human Resources Management

23. HRM in the new millennium
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HRM in the new millennium
v Changes in 21st century affecting HRM
HR as a springboard for success
Talent hunting, developing and retraining
Lean and mean organisations
Labour relations
Health and benefit programmes
The Strategic Role Of Human Resources Management