Creating New Hr Department

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The functions of an HR department

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Creating New Hr Department

  1. 1. A STUDY IN THE TYPICAL FUNCTIONS OF A TYPICAL HR DEPARTMENT IN AN TYPICALLY ADVANCED ORGANIZATION
  2. 2. <ul><li>Challenges facing Human Resources </li></ul><ul><li>Current Scenario </li></ul><ul><ul><li>Internal Factors - A Vicious Circle </li></ul></ul><ul><ul><ul><li>Perception of De-motivated Workforce. </li></ul></ul></ul><ul><ul><ul><li>Low Productivity </li></ul></ul></ul><ul><ul><ul><li>High Employee Turnover </li></ul></ul></ul><ul><ul><ul><li>Low External Customer Satisfaction. </li></ul></ul></ul><ul><ul><ul><li>Damage to Company Image. </li></ul></ul></ul><ul><ul><ul><li>Loss of Revenue/Business </li></ul></ul></ul>
  3. 3. <ul><li>Challenges facing Human Resources </li></ul><ul><li>Current Scenario </li></ul><ul><ul><li>External Factors </li></ul></ul><ul><ul><ul><li>Pressure of Localization of Manpower. </li></ul></ul></ul><ul><ul><ul><li>Boom/ Recession in Economy leading to Increase/ Decrease in Business and Competition/ Survival. </li></ul></ul></ul><ul><ul><ul><li>Demand for Qualified Manpower exceeding Supply. </li></ul></ul></ul><ul><ul><ul><li>Restrictions on Import of Qualified Manpower </li></ul></ul></ul><ul><ul><ul><li>Increase of Compensation and Benefits in Public Sector </li></ul></ul></ul>
  4. 4. Challenges facing Human Resources De-motivated Workforce Damage to Company Image Loss of Business Low Customer Satisfaction High Employee Turnover Low Productivity
  5. 5. <ul><li>Challenges facing Human Resources </li></ul><ul><li>What does HR need to do in order to succeed? </li></ul><ul><li>A1 - To become Leaders in our business we do not need to do different things, we just need to do things differently. </li></ul><ul><li>A2 – Need Total Cooperation and Support from the Management at all levels. </li></ul><ul><li>Result - Benefits derived from changes made by HR are intangible but have an extremely high impact on Company performance and bottom line. </li></ul>
  6. 6. <ul><li>HR Department – An Introduction </li></ul><ul><li>Human Resources is a term which many organizations describe the combination of traditionally administrative personnel functions with performance management, employees relation and resource planning. </li></ul><ul><li>The more common usage within corporations and businesses refers to the individuals within the firm, and to the portion of the firm’s organization that deals with hiring, firing, training, and other personnel issues. </li></ul><ul><li>The objective of HR is to maximize the return on investment from the organization’s human capital and minimize financial risk. It is the responsibility of HR Managers to conduct these activities in an effective, legal, fair, and consistent manner. </li></ul>
  7. 7. <ul><li>Functions of HR Department </li></ul><ul><li>Human Resource Management serves these key functions: </li></ul><ul><ul><li>Recruitment Strategy Planning </li></ul></ul><ul><ul><li>Hiring Processes (recruitment) </li></ul></ul><ul><ul><li>Performance Evaluation and Management </li></ul></ul><ul><ul><li>Promotions </li></ul></ul><ul><ul><li>Redundancy </li></ul></ul><ul><ul><li>Industrial and Employee Relations </li></ul></ul><ul><ul><li>Record keeping of all personal data </li></ul></ul><ul><ul><li>Compensation, benefits, bonuses etc in liaison with Payroll </li></ul></ul><ul><ul><li>Confidential advice to internal ‘customers’ in relation to problems at work. </li></ul></ul>
  8. 8. <ul><li>Role of Human Resource Management </li></ul><ul><li>The goal of Human Resource Management is to help an organization to meet strategic goals by attracting, and maintaining employees and also to manage them effectively. </li></ul><ul><li>The role of HRM defines 4 fields for the HRM function </li></ul><ul><ul><li>Strategic Business Partner </li></ul></ul><ul><ul><li>Change Agent </li></ul></ul><ul><ul><li>Employee Champion </li></ul></ul><ul><ul><li>Administration </li></ul></ul><ul><li>However, many HR functions these days struggle to get beyond the roles of administration and employee champion, and are seen rather as reactive than strategically proactive partners for the top management. </li></ul><ul><li>In addition, HR organizations have the difficulty in proving how their activities and processes add value to the company. Only in the recent years HR scholars and professionals are focusing on models that can measure if HR adds value. </li></ul>
  9. 9. <ul><li>HR Department and its Sections </li></ul><ul><li>The HR department normally comprises of 5 sections as follows: </li></ul><ul><ul><li>Recruitment Section – responsible for all Recruitment and Placement activities. </li></ul></ul><ul><ul><li>Government & Public Relations Section – responsible for dealing with Labor and Passport Offices for processing Work Permits and their renewal, custody of passports and their renewal, etc… </li></ul></ul><ul><ul><li>Employee Relations Section – responsible for facilitating the documentation of employees from hiring to firing as well as initiating and completing various other processes. </li></ul></ul><ul><ul><li>General Services Section – responsible for providing Support Services to the employees in Accommodation, Transportation, Flight reservations and Ticketing, Medical, Utilities, etc… </li></ul></ul><ul><ul><li>Training and Career Development – responsible for evaluating the training needs of the employees and ensuring that there is a proper career development plan for the employees. </li></ul></ul>
  10. 10. <ul><li>Human Resource Management Processes </li></ul><ul><li>Human Resource Management comprises several processes: </li></ul><ul><ul><li>Workforce Planning </li></ul></ul><ul><ul><li>Recruitment </li></ul></ul><ul><ul><li>Induction and Orientation </li></ul></ul><ul><ul><li>Skills Management </li></ul></ul><ul><ul><li>Training and Development </li></ul></ul><ul><ul><li>Personnel Administration </li></ul></ul><ul><ul><li>Compensation in wage or salary </li></ul></ul><ul><ul><li>Time Management </li></ul></ul><ul><ul><li>Travel Management </li></ul></ul><ul><ul><li>Payroll </li></ul></ul><ul><ul><li>Employee Benefits Administration </li></ul></ul><ul><ul><li>Personnel Cost Planning </li></ul></ul><ul><ul><li>Performance Appraisal </li></ul></ul>
  11. 11. <ul><li>Need for Transformation Program – HR Department </li></ul><ul><li>________________ Company has grown considerably since its inception, however not all departments have kept pace with this growth, particularly the HR department. </li></ul><ul><li>It is now time to transform the HR department of ___________ Company from a provider of basic support services to an active business partner similar to other departments in the organization. </li></ul><ul><li>In order to achieve this transformation the HR department of _____________ Company needs to develop new HR Policies and Procedures, which while maintaining salient features of the current practices will contain strong features of best HR practices of reputed organizations . </li></ul>
  12. 12. <ul><li>Transformation through HR Policies and Procedures </li></ul><ul><li>New and comprehensive HR Policies and Procedures are to be developed for dealing with the following basic functions of the HR department. </li></ul><ul><ul><li>Business Staffing Plan </li></ul></ul><ul><ul><li>Recruitment and Internal Selection </li></ul></ul><ul><ul><li>Grade and Salary Structure </li></ul></ul><ul><ul><li>Company Benefits and Allowances </li></ul></ul><ul><ul><li>Employee Probation </li></ul></ul><ul><ul><li>Leaves and Company Holidays </li></ul></ul><ul><ul><li>Employee Performance Evaluation </li></ul></ul><ul><ul><li>Promotion and Merit Increase </li></ul></ul><ul><ul><li>Financial Loan, Housing and Salary Advance </li></ul></ul><ul><ul><li>Business Travel </li></ul></ul><ul><ul><li>Time, Attendance and Overtime </li></ul></ul><ul><ul><li>Employee Suggestions </li></ul></ul><ul><ul><li>Termination of Employment </li></ul></ul>
  13. 13. <ul><li>Standardization of Policies and Processes </li></ul><ul><li>The basis for implementing HR Policies and Procedures is to standardize all HR activities in the organization. </li></ul><ul><li>To augment the effectiveness of HR Policies and Procedures, HR department will need to initiate a number of processes in the last quarter of every year. </li></ul><ul><li>These processes include: </li></ul><ul><ul><li>Business Staffing Plan </li></ul></ul><ul><ul><li>Employees Performance Evaluation </li></ul></ul><ul><ul><li>Employees Vacation Schedule </li></ul></ul><ul><ul><li>Employee Satisfaction Survey </li></ul></ul>
  14. 14. <ul><li>Business Staffing Plan </li></ul><ul><li>Manpower planning is one of the most critical functions of the HR department, which can add value to HR functions such as </li></ul><ul><ul><li>Budgeting of manpower costs. </li></ul></ul><ul><ul><li>Internal Selection to Vacant Positions. </li></ul></ul><ul><ul><li>Reduce recruitment costs. </li></ul></ul><ul><ul><li>Planning of employees leaves, etc, etc.… </li></ul></ul><ul><li>This exercise will be conducted in the beginning of the last quarter of every year. </li></ul>
  15. 15. <ul><li>Recruitment and Internal Selection </li></ul><ul><li>Due to the strategic location of the HR department in the organization, all recruitment activities should be sourced from the HR department </li></ul><ul><li>Recruitment of manpower will be based to a large extent on the Business Staffing Plan. </li></ul><ul><li>HR department has to make efforts to record all employee information in the HR Information System (HRIS), which will enable proper Internal Selection of employees to vacant positions. </li></ul>
  16. 16. <ul><li>Grade and Salary Structure </li></ul><ul><li>Each position in the organization should be properly graded according to the ranking of various factors attributed to the job position. </li></ul><ul><li>Each grade should have a specific salary range from Minimum to Maximum and the HR department has to ensure that all employees are in the salary range of their grade. </li></ul><ul><li>Studies should be conducted each year to monitor the salary levels and compare it with that of the competitors and the market in general to remain competitive. </li></ul>
  17. 17. <ul><li>Company Benefits and Allowances </li></ul><ul><li>Standardization of Compensation and Benefits is one of the key factors in employee retention. </li></ul><ul><li>HR department should develop a comprehensive benefits and allowances table for each grade, which when implemented will considerably reduce any existing discrepancies. </li></ul>
  18. 18. <ul><li>Leaves and Company Holidays </li></ul><ul><li>HR department will place special emphasis on the preparation of Vacation Schedule by all departments at the end of each year, which will form the basis for all the HR activities related to processing of employees leaves. </li></ul><ul><li>Proper scheduling of leaves ensures high level of employee satisfaction as well as efficient management of the organization. </li></ul><ul><li>Accurate records should be maintained by HR department of all leaves taken by the employees. </li></ul>
  19. 19. <ul><li>Employee Performance Evaluation </li></ul><ul><li>Properly conducted Performance Management Systems form the prime basis for Organizational development and growth. </li></ul><ul><li>Although performance management of employees is a daily process, yet HR will initiate the recording of this process once each year. </li></ul><ul><li>Employee Performance Evaluation will be conducted during the last quarter of each year and will form the basis for Salary Review, Promotion and Career Development. </li></ul>
  20. 20. <ul><li>Promotion and Merit Increase </li></ul><ul><li>Promotion of employees and adjustment of salaries will be based on the performance of employees in current positions. </li></ul><ul><li>Promoting employees and awarding salary increase will follow a definite and fixed pattern, and should be part of the Business Plan. </li></ul><ul><li>The Executive Management will have to make a major contribution to this exercise and will be guided by the HR department. </li></ul>
  21. 21. <ul><li>Business Travel </li></ul><ul><li>Unorganized Business Travel can be a severe strain on the financial resources of the organization. </li></ul><ul><li>Business Travel needs to be planned well in advance in order to secure economical flight and accommodation facilities. </li></ul><ul><li>Travel expenses payable to Employees on Business Travel could be either based on actual costs with limits or by providing them with Per Diem Allowance based on the Cost of Living Index of the specific country. </li></ul>
  22. 22. <ul><li>Time, Attendance and Overtime </li></ul><ul><li>Controlling Time and Attendance of employees is also a basic function of HR department due to the legal and financial implications involved with this function. </li></ul><ul><li>Involving HR department in controlling attendance will ensure that absences and leaves are properly documented and necessary action taken without delay. </li></ul><ul><li>The Time, Attendance and Overtime policy will describe in detail the procedure that the departments need to implement in order to effectively monitor attendance of employees. </li></ul>
  23. 23. <ul><li>Employee Suggestions </li></ul><ul><li>Most of the organizations rely on the suggestions made by their employees that help in reducing cost or increasing profitability due to their explicit understanding of the situation. </li></ul><ul><li>Employees can be motivated to give their suggestions by offering to reward them if their suggestions bring in the desired result. </li></ul><ul><li>Employee suggestions will be reviewed by the concerned departments, submitted for approval if found feasible. </li></ul>
  24. 24. <ul><li>Termination of Employment </li></ul><ul><li>The policy on Termination of Employment provides information on the various types of termination of employment either by the employee or the company. </li></ul><ul><li>Proper care has to be taken to ensure Clearance, Final Release and Exit Interview. </li></ul><ul><li>Quarterly analysis of the Exit Interviews will be made by HR. </li></ul>
  25. 25. <ul><li>HR Information Systems </li></ul><ul><li>Besides developing Policies and Procedures, it is also necessary to develop a simple yet effective HR Information System which should be intelligent to use the information saved in it. </li></ul><ul><li>Some of the highlights of the automation process besides Self Service should include: </li></ul><ul><ul><li>System informing employees/supervisor of the imminent expiry of their citizenship card/ passport/ resident permit. </li></ul></ul><ul><ul><li>System issuing warning letters for absences or tardiness. </li></ul></ul><ul><ul><li>System informing employees through email of their delay in returning from leave and much more. </li></ul></ul>
  26. 26. <ul><li>Employee Handbook </li></ul><ul><li>Development of new HR Policies and Procedures should be followed by the preparation of a new Employee Handbook. </li></ul><ul><li>The Employee Handbook should address most of the “Frequently Asked Questions” (FAQ) of the employees as well as information of the Company and the organizational structure. </li></ul>
  27. 27. <ul><li>Preparing Job Descriptions, Career Paths, Position Capability Specifications and Employee Capability Specifications </li></ul><ul><li>Other important tasks that the HR department needs to perform if it is to be given the rightful position of an active business partner in the organization are: </li></ul><ul><ul><li>Preparing Job Descriptions and Job Analysis for each position, which will form the basis for Recruitment and in preparing Position Capability Specifications for each job. </li></ul></ul><ul><ul><li>Preparation of Job Description will lead to preparing Career Paths for each position. </li></ul></ul><ul><ul><li>Preparing Position Capability Specifications for each job, which will be matched with the Employees Capabilities by preparing Employee Capability Specifications. </li></ul></ul><ul><ul><li>The Employee Capabilities Specification along with the completed Performance Evaluation sets in motion plans for Career Development of Employees. </li></ul></ul>
  28. 28. <ul><li>Succession Planning </li></ul><ul><li>In order to ensure continuity in the management level due to promotion, transfer, absence or discontinuation of services, it is necessary to identify employees who could replace these employees. </li></ul><ul><li>Employees in Supervisory level and above will be marked for Succession Planning and special efforts will be made in the development of their career. </li></ul><ul><li>This information along with regular updates will be made available to the CEO. </li></ul>
  29. 29. <ul><li>HR Quality Audits </li></ul><ul><li>HR department should conduct HR audits periodically to ensure that the HR Policies and Procedures are stringently implemented in the performance of the various HR functions. </li></ul><ul><li>HR Audit will not only be limited to the extent of governance or implementation but will also study the effectiveness or changes that have been brought about due to the implementation of the Policies and Procedures. </li></ul><ul><li>HR Audit checks should be conducted quarterly in all the departments and projects of the organization. </li></ul>
  30. 30. THANK YOU

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