Human Resource Management (UGC NET Commerce & Management

KD COMMERCE CLASSES
2019
Human Recourse Management
Prepared by Umakant Annand(UGC NET Commerce, MCom, MBA)
UGC NET Commerce & Management
D A D D Y C O O L , H A R D O I R O A D B A L A G A N J L K O .

2 | Page Prepared by Umakant Annand(UGC NET Commerce, MCom, MBA)
Topic -1 Concept of HRM
Meaning:
Before we define HRM, it seems pertinent to first define the term ‘human resources’. In common parlance, human
resources means the people.
According to Leon C. Megginson “From the national point of view human resources are knowledge, skills, creative
abilities, talents, and attitudes obtained in the population; whereas from the view-point of the individual enterprise,
they represent the total of the inherent abilities, acquired knowledge and skills as exemplified in the talents and
aptitude of its employees”.
According to Flippo “Personnel management, or say, human resource management is the planning, organising,
directing and controlling of the procurement development compensation integration, 4intenance, and separation of
human resources to the end that individual, organisational and social objectives are accomplished”.
Objectives:
The primary objective of HRM is to ensure the availability of right people for right jobs so as the organisational
goals are achieved effectively.
1) To help the organisation to attain its goals effectively and efficiently by providing competent and motivated
employees.
2) To utilize the available human resources effectively.
3) To increase to the fullest the employee’s job satisfaction and self-actualisation.
4) To develop and maintain the quality of work life (QWL) which makes employment in the organisation a
desirable personal and social situation.
5) To help maintain ethical policies and behaviour inside and outside the organisation.
6) To establish and maintain cordial relations between employees and management.
7) To reconcile individual/group goals with organisational goals.
HRM Objectives and Functions:

Scope of HRM
The scope of HRM is, indeed, very vast and wide. It includes all activities starting from manpower planning till
employee leaves the organisation. Accordingly, the scope of HRM consists of acquisition, development,
maintenance/retention, and control of human resources in the organisation (see figure 1.1). The same forms the
subject matter of HRM. As the subsequent pages unfold, all these are discussed, in detail, in seriatim.
The National Institute of personnel Management, Calcutta has specified the scope of HRM as follows:
1. The Labour or Personnel Aspect:
This is concerned with manpower planning, recruitment, selection, placement, transfer, promotion, training and
development, lay-off and retrenchment, remuneration, incentives, productivity, etc.
2. Welfare Aspect:
It deals with working conditions, and amenities such as canteen, creches, rest and lunch rooms, housing, transport,
medical assistance, education, health and safety, recreation facilities, etc.
3. Industrial Relations Aspects:
This covers union-management relations, joint consultation, collective bargaining, grievance and disciplinary
actions, settlement of disputes, etc.
Functions:
We have already defined HRM. The definition of HRM is based on what managers do. The functions performed by
managers are common to all organizations. For the convenience of study, the function performed by the resource
management can broadly be classified into two categories, viz.
(1) Managerial functions, and
(2) Operative functions (see fig. 1.2).
These are discussed in turn.
(1) Managerial Functions:
Planning:
Planning is a predetermined course of actions. It is a process of determining the organisational goals and
formulation of policies and programmes for achieving them. Thus planning is future oriented concerned with
clearly charting out the desired direction of business activities in future. Forecasting is one of the important
elements in the planning process. Other functions of managers depend on planning function.
Organising:
Organising is a process by which the structure and allocation of jobs are determined. Thus organising involves
giving each subordinate a specific task establishing departments, delegating authority to subordinates, establishing
channels of authority and communication, coordinating the work of subordinates, and so on.

Staffing:
TOs is a process by which managers select, train, promote and retire their subordinates This involves deciding what
type of people should be hired, recruiting prospective employees, selecting employees, setting performance
standard, compensating employees, evaluating performance, counselling employees, training and developing
employees.
Directing/Leading:
Directing is the process of activating group efforts to achieve the desired goals. It includes activities like getting
subordinates to get the job done, maintaining morale motivating subordinates etc. for achieving the goals of the
organisation.
Controlling:
It is the process of setting standards for performance, checking to see how actual performance compares with these
set standards, and taking corrective actions as needed.
(2) Operative Functions:
The operative, also called, service functions are those which are relevant to specific department. These functions
vary from department to department depending on the nature of the department Viewed from this standpoint, the
operative functions of HRM relate to ensuring right people for right jobs at right times. These functions include
procurement, development, compensation, and maintenance functions of HRM.
A brief description of these follows:
Procurement:
It involves procuring the right kind of people in appropriate number to be placed in the organisation. It consists of
activities such as manpower planning, recruitment, selection placement and induction or orientation of new
employees.
Development:
This function involves activities meant to improve the knowledge, skills aptitudes and values of employees so as to
enable them to perform their jobs in a better manner in future. These functions may comprise training to
employees, executive training to develop managers, organisation development to strike a better fit between
organisational climate/culture and employees.
Compensation:
Compensation function involves determination of wages and salaries matching with contribution made by
employees to organisational goals. In other words, this function ensures equitable and fair remuneration for

employees in the organisation. It consists of activities such as job evaluation, wage and salary administration,
bonus, incentives, etc.
Maintenance:
It is concerned with protecting and promoting employees while at work. For this purpose virus benefits such as
housing, medical, educational, transport facilities, etc. are provided to the employees. Several social security
measures such as provident fund, pension, gratuity, group insurance, etc. are also arranged.
Topic-2 Human Resource Planning
Human Resource Planning is a systematic process of forecasting both the prospective demand for and supply of
manpower, and employment of skills with the objectives of the organization. It can also be termed as the method of
reviewing the manpower necessities to ensure that right kind of skills is made available to the organization.
The main purpose of HRP is to set the goals and objectives of the company. In other words, it is to have the precise
number of employees, with their skills matching the requirements of the organization, so that the organization can move
towards its goals. Chief objectives of Human Resource Planning are as follows:
o Guarantee ample supply of resources, whenever there is a need for it.
o Make sure that the current manpower in the company is being used properly.
o To foresee the potential requirements of manpower at various skill levels.
o Evaluate excess or scarcity of resources that are available at a given point of time.
o Predict the impact of technological changes on the resources as well as on the kind of jobs they do.
o Manage the resources that are already employed in the organization.
o Ensure that there is a lead time available to pick and train any supplementary human resource.
Need for Human Resource Planning
The need of HRP may arise because of the following reasons:
1) In India, unemployment is a grave concern. Scarcity of manpower and that too with the required skill sets and
competence, has given rise for need of Human Resource Planning.
2) It comes handy for smooth and continuous supply of workers when a huge number of employees is retiring, or
leaving the company or maybe they are incapable of working due to psychological or physical ailments.
3) There is a need for Human Resource Planning when there is an increase in employee turnover, which is obvious.
Some examples of this turnover are promotions, marriages, end of contract, etc.
4) Technological changes lead to a chain of changes in the organization, right from skill sets product methods and
administration techniques. These changes lead to an overall change in the number of employees required and
with entirely different skill set. It is here that the Human Resource Planning helps the organization deal with the
necessary changes.
5) Human Resource Planning is required to meet the requirements of diversification and growth of a company.
6) There is a need for Human Resource Planning in downsizing the resources when there is a shortage of
manpower. Similarly, in case of excess resources, it helps in redeploying them in other projects of the company.
Importance of Human Resource Planning
After the need for HRP, it is apt to discuss the importance of it. A few are mentioned below.
1) It gives the company the right kind of workforce at the right time frame and in right figures.
2) In striking a balance between demand-for and supply-of resources, HRP helps in the optimum usage of
resources and also in reducing the labor cost.
3) Cautiously forecasting the future helps to supervise manpower in a better way, thus pitfalls can be avoided.
4) It helps the organization to develop a succession plan for all its employees. In this way, it creates a way for
internal promotions.
5) It compels the organization to evaluate the weaknesses and strengths of personnel thereby making the
management to take remedial measures.
6) The organization as a whole is benefited when it comes to increase in productivity, profit, skills, etc., thus giving
an edge over its competitors.

Human Resource Planning Process
In any Human Resource Planning model there are three key elements which the management should adhere to:
1) Forecasting recruitment needs: There are a number of ways in forecasting your business needs, to know
the exact number of employees required to run the business. Factors to be considered are the economical
situation of any given country, internal and external factors of an organization and the demand for the
products.
2) Evaluate Supply: In estimating this, there are two aspects, one is the evaluation of the internal resources
and the other is the prospective or external resources. Among the two, external factors require extra care,
these include education, unemployment rate and law that is in existence. Evaluating these factors very closely
will help the organization in filling the right resources at the right time with the right skill set.
3) Supply and demand balance: This element of Human Resource Planning is very important, as striking a
balance between these two forces will help the organization in understanding if there is shortage or excess of
employees available in a particular group. It also helps in understanding as to the need of full time or part
time needs of the organization.
Topic -3 Recruitment
Recruitment is a positive process of searching for prospective employees and stimulating them to apply for the jobs
in the organisation. When more persons apply for jobs then there will be a scope for recruiting better persons.
Definition:
According to Edwin B. Flippo, “It is a process of searching for prospective employees and stimulating and
encouraging them to apply for jobs in an organisation.” He further elaborates it, terming it both negative and
positive.

Process of Recruitment:
Recruitment Process Passes through the Following Stages:
1) Searching out the sources from where required persons will be available for recruitment. If young
managers are to be recruited then institutions imparting instructions in business administration will be the
best source.
2) Developing the techniques to attract the suitable candidates. The goodwill and reputation of an organisation
in the market may be one method. The publicity about the company being a professional employer may
also assist in stimulating candidates to apply.
3) Using of good techniques to attract prospective candidates. There may be offers of attractive salaries,
proper facilities for development, etc.
4) The next stage in this process is to stimulate as many candidates as possible to apply for jobs. In order to
select a best person, there is a need to attract more candidates.
Factors affecting recruitment:
There are a number of factors that affect recruitment.
These are broadly classified into two categories:
1. Internal Factors
2. External Factors
These are discussed one
1. Internal Factors:
The internal factors also called endogenous factors are the factors within the organisation that affect recruiting
personnel in the organisation. Some of these are mentioned here.
by one.
a) Size of the Organisation:
The size of an organisation affects the recruitment process. Experience suggests that larger organisations
find recruitment less problematic than organisations with smaller in size.
b) Recruiting Policy:
The recruiting policy of the organisation i.e., recruiting from internal sources (from own employees) and
from external sources (from outside the organisation) also affects recruitment process. Generally, recruiting
through internal sourcing is preferred, because own employees know the organisation and they can well fit
into the organisation’s culture.
c) Image of Organisation:
Image of organisation is another internal factor having its influence on the recruitment process of the
organisation. Good image of the organisation earned by a number of overt and covert actions by
management helps attract potential and competent candidates. Managerial actions like good public
relations, rendering public services like building roads, public parks, hospitals and schools help earn image
or goodwill for the organisation. That is why blue chip companies attract large number of applications.
d) Image of Job:
Just as image of organisation affects recruitment so does the image of a job also. Better remuneration and
working conditions are considered the characteristics of good image of a job. Besides, promotion and
career development policies of organisation also attract potential candidates.
2. External Factors:
Like internal factors, there are some factors external to organisation which has their influence on recruitment
process.
Some of these are given below:
a) Demographic Factors:
As demographic factors are intimately related to human beings, i.e., employees, these have profound
influence on recruitment process. Demographic factors include sex, age, literacy, economic status etc.
b) Labour Market:
Labour market conditions i.e., supply and demand of labour is of particular importance in affecting
recruitment process. For example, if the demand for a specific skill is high relative to its supply, recruiting
employees will involve more efforts. On the contrary, if supply is more than demand for a particular skill,
recruitment will be relatively easier.

c) Unemployment Situation:
The rate unemployment is yet another external factor having its influence on the recruitment process. When
the unemployment rate in a given area is high, the recruitment process tends to be simpler. The reason is
not difficult to seek. The number of applicants is expectedly very high which makes easier to attract the
best qualified applicants. The reverse is also true. With a low rate of unemployment, recruiting process
tends to become difficult.
d) Labour Laws:
There are several labour laws and regulations passed by the Central and State Governments that govern
different types of employment. These cover working conditions, compensation, retirement benefits, and
safety and health of employees in industrial undertakings.
e) Legal Considerations:
Another external factor is legal considerations with regard to employment. Reservation of jobs for the
scheduled castes, scheduled tribes, and other backward classes (OBCs) is the popular example of such legal
consideration. The Supreme Court of India has given its verdict in favour of 50 per cent of jobs and seats.
This is so in case of admissions in the educational institutions also.
Sources of recruitment
Internal sources of recruitment
Internal sources of recruitment involve motivating the employees of the organization to apply for the openings
within the organization. Job openings are informed to the employees of the same organization by giving internal
advertisements, word of mouth or communication through the hierarchy. Many organizations are practicing this
approach to motivate the skilled employees of the organization, to reduce the employee turnover, to reduce the cost
and to get a competitive advantage. Various methods of internal sources or recruitment are as follows.

1) Transfers
The employees of the organization are transferred to the similar jobs of other departments. It may not
involve a change in salary, responsibility, and position of the job. Transfers help in reducing the boredom
and monotony of the employees or it may be used to fill the vacancies with suitable internal candidates.
2) Promotions
Promotions involve vacancies of the organization are filled by promoting the skilled employees to the
suitable jobs and it can motivate the employees by giving higher position, increased salary, status, and
responsibility. Promotions can help in reducing employee turnover by creating the hope of getting higher
positions.
3) Demotions
Depending on the performance of the employees of the organizations, sometimes managers have to take
decisions regarding lowering the positions of few employees of the organization. These employees can act
as a source of recruitment to the lower positions.
4) Employees of the organization
Employees of the organization communicate or inform about the vacant positions of the organization to
their friends and relatives. In many organizations, they allowed referring potential candidates for the
suitable vacancies.
5) Retired employees
If the organizations do not find the right persons to fulfill the key managerial positions then they call back
the retired employees for achieving the objectives.
Advantages of internal sources recruitment
o When the existed employees are given a chance to get the higher positions of the organization then the employee
loyalty increases towards the organization.
o It highly motivates the employees and helps in maximizing the job satisfaction.
o Existed employees of the organization are well known about the organization culture.
o Internal sources of recruitment highly reduce efforts and cost.
o It helps in reducing the employee turnover.
o It creates a scope to get a competitive advantage by recruiting the skilled employees for the higher positions.
o It helps in maximizing job security and job satisfaction
o Transfers from one department to another department helps in eliminating boredom and monotony in employees.
o It helps in reducing the efforts of induction programs.
Disadvantages of internal sources of recruitment
o Internal sources of recruitment reduce the scope of finding skilled and more efficient people.
o The introduction of new methods and strategies may not always possible with this approach.
o Losing more efficient persons from the external environment becomes a competitive advantage to the competitors.
o This approach is not suitable for all the organizations

External sources of recruitment
External sources of recruitment involve motivating the skilled and more efficient candidates external to the
organization to apply for the vacant positions in the organization. Job openings are informed to the external
environment by using various methods such as advertisements, campus recruitment, employment exchanges, walk
in interviews, organizational websites, job fairs, and job portals.
1) Advertisements
To find the skilled and more efficient manpower giving advertisement for the vacant job position is the
better way. Advertisements help in attracting the right candidates and in maximizing brand image.
Advertisements may be given in print media or electronic media, it gives better results and it is cheaper
than approaching third parties.
2) Job portals
With the growing technology and internet usage, job portals are playing a major role in finding right
candidates for right jobs. Job portals can inform up to date job alerts to the candidates and offer attractive
benefits and packages to the employers. The tools and techniques used by the job portals highly reduce the
efforts in finding the skilled candidates.
3) Company’s websites
With the increase in business operations and globalization, the need for human resources is also increasing
day by day. To face a severe competition and to reduce the cost during the long run, many companies are
setting up their own websites for finding and attracting candidates with competitive skills.
4) Social networking sites
Communicating about vacant positions of the organization through social networking sites help in
motivation and attracting the highly skilled and more efficient candidates to apply for the jobs.
5) Placement agencies
Approaching placement agencies reduces the time and efforts to find the right candidates from the pool of
skilled candidates. They use various tools and techniques to filter the resumes and they send it to the
companies for further processing. The main drawback of this method is commission basis on hiring the
candidates.
6) Job fairs and walk in interviews

Walk in interviews and job fairs are declared and conducted by companies to find the skilled candidates.
Following this method highly reduces efforts in finding more efficient human resources for the bulk
requirement.
7) Campus interviews
This is an easy and economical method helps in finding eligible candidates, through this method
organization can find energetic and more competitive candidates for suitable vacancies, this method is
beneficial for both the candidates and companies.
Topic- 4 Selection
Definition: The Selection is the process of choosing the most suitable candidate for the vacant position in the
organization. In other words, selection means weeding out unsuitable applicants and selecting those individuals
with prerequisite qualifications and capabilities to fill the jobs in the organization
Definition: The Selection is a process of picking the right candidate with prerequisite qualifications and
capabilities to fill the jobs in the organization.
Selection Process
The selection procedure comprises of following systematic steps:
1) Preliminary Interview: The preliminary interview is also called as a screening interview wherein those
candidates are eliminated from the further selection process who do not meet the minimum eligibility
criteria as required by the organization.
2) Receiving Applications: Once the individual qualifies the preliminary interview he is required to fill in the
application form in the prescribed format. This application contains the candidate data such as age,
qualification, experience, etc. This information helps the interviewer to get the fair idea about the candidate
and formulate questions to get more information about him.
3) Screening Applications: Once the applications are received, these are screened by the screening
committee, who then prepare a list of those applicants whom they find suitable for the interviews. The
shortlisting criteria could be the age, sex, qualification, experience of an individual. Once the list is
prepared, the qualified candidates are called for the interview either through a registered mail or e-mails.

4) Employment Tests: In order to check the mental ability and skill set of an individual, several tests are
conducted. Such as intelligence tests, aptitude tests, interest tests, psychological tests, personality tests, etc.
These tests are conducted to judge the suitability of the candidate for the job.
5) Employment Interview: The one on one session with the candidate is conducted to gain more insights
about him. Here, the interviewer asks questions from the applicant to discover more about him and to give
him the accurate picture of the kind of a job he is required to perform.
6) Checking References: The firms usually ask for the references from the candidate to cross check the
authenticity of the information provided by him. These references could be from the education institute
from where the candidate has completed his studies or from his previous employment where he was
formerly engaged. These references are checked to know the conduct and behavior of an individual and
also his potential of learning new jobs.
7) Medical Examination: Here the physical and mental fitness of the candidate are checked to ensure that he
is capable of performing the job. In some organizations, the medical examination is done at the very
beginning of the selection process while in some cases it is done after the final selection.
8) Final Selection: Finally, the candidate who qualifies all the rounds of a selection process is given the
appointment letter to join the firm.
Thus, the selection is complex and a lengthy process as it involves several stages than an individual has to
qualify before getting finally selected for the job.
E-Recruitment
Definition: The E-Recruitment, also called as Online Recruitment, is the process of hiring the potential
candidates for the vacant job positions, using the electronic resources, particularly the internet.
Advantages of E-Recruitment
1) Low cost per candidate, as compared to the physical recruitment process.
2) Wide geographical coverage, i.e. the candidates can be hired from any part of the world.
3) Beneficial for both the employer and the job seeker, the corporations can find the prospective candidates
through their CVs attached to world wide web, and similarly, the candidates can search the employer
through their job vacancy advertisement posted on the internet.
4) Less time required in hiring the potential candidate for the firm.
5) Right people for the right job can be easily found through E-Recruitment, by matching the candidate’s CVs
with the job profile.
6) The recruitment process becomes more efficient and easy to record details of the applicant.
The E-Recruitment software and systems are available, through which the entire recruitment process becomes
automated. One of the systems is the Recruitment Management System, which is a portal that involves hiring the
candidates online and each step involved in the recruitment process is automatized.
Topic-5 Training:
Training constitutes a basic concept in human resource development. It is concerned with developing a particular
skill to a desired standard by instruction and practice. Training is a highly useful tool that can bring an employee
into a position where they can do their job correctly, effectively, and conscientiously. Training is the act of
increasing the knowledge and skill of an employee for doing a particular job.
Definition of Training:
Dale S. Beach defines training as ‘the organized procedure by which people learn knowledge and/or skill for a
definite purpose’. Training refers to the teaching and learning activities carried on for the primary purpose of
helping members of an organization acquire and apply the knowledge, skills, abilities, and attitudes needed by a
particular job and organization.
Specifically the need for training arises because of following reasons:
1) Environmental changes:

Mechanization, computerization, and automation have resulted in many changes that require trained staff
possessing enough skills. The organization should train the employees to enrich them with the latest
technology and knowledge.
2) Organizational complexity:
With modern inventions, technological upgradation, and diversification most of the organizations have
become very complex. This has aggravated the problems of coordination. So, in order to cope up with the
complexities, training has become mandatory.
3) Human relations:
Every management has to maintain very good human relations, and this has made training as one of the
basic conditions to deal with human problems.
4) To match employee specifications with the job requirements and organizational needs:
An employee’s specification may not exactly suit to the requirements of the job and the organization,
irrespective of past experience and skills. There is always a gap between an employee’s present
specifications and the organization’s requirements. For filling this gap training is required.
5) Change in the job assignment:
Training is also necessary when the existing employee is promoted to the higher level or transferred to
another department. Training is also required to equip the old employees with new techniques and
technologies.
Methods of Training: On-the-job Training Method and Off-the-Job Methods!
Management development is a systematic process of growth and development by which the managers develop their
abilities to manage. It is concerned with not only improving the performance of managers but also giving them
opportunities for growth and development.
There are two methods through which managers can improve their knowledge and skills. One is through formal
training and other is through on the job experiences. On the job training is very important since real learning takes
place only when one practices what they have studied.
But it is also equally important in gaining knowledge through classroom learning. Learning becomes fruitful only
when theory is combined with practice. Therefore on the job methods can be balanced with classroom training
methods (off-the-job methods).
1. On-the-job Training (OJT) Methods:
This is the most common method of training in which a trainee is placed on a specific job and taught the skills and
knowledge necessary to perform it.
The advantages of OJT are as follows:
1) On the job method is a flexible method.
2) It is a less expensive method.
3) The trainee is highly motivated and encouraged to learn.
4) Much arrangement for the training is not required.
On-the-job training methods are as follows:
1. Job rotation:
This training method involves movement of trainee from one job to another gain knowledge and
experience from different job assignments. This method helps the trainee understand the problems of other
employees.
2. Coaching:
Under this method, the trainee is placed under a particular supervisor who functions as a coach in training
and provides feedback to the trainee. Sometimes the trainee may not get an opportunity to express his
ideas.
3. Job instructions:
Also known as step-by-step training in which the trainer explains the way of doing the jobs to the trainee
and in case of mistakes, corrects the trainee.

4. Committee assignments:
A group of trainees are asked to solve a given organizational problem by discussing the problem. This
helps to improve team work.
5. Internship training:
Under this method, instructions through theoretical and practical aspects are provided to the trainees.
Usually, students from the engineering and commerce colleges receive this type of training for a small
stipend.
2. Off-the-job Methods:
On the job training methods have their own limitations, and in order to have the overall development of employee’s
off-the-job training can also be imparted. The methods of training which are adopted for the development of
employees away from the field of the job are known as off-the-job methods.
The following are some of the off-the-job techniques:
1) Case study method:
Usually case study deals with any problem confronted by a business which can be solved by an employee.
The trainee is given an opportunity to analyse the case and come out with all possible solutions. This
method can enhance analytic and critical thinking of an employee.
2) Incident method:
Incidents are prepared on the basis of actual situations which happened in different organizations and each
employee in the training group is asked to make decisions as if it is a real-life situation. Later on, the entire
group discusses the incident and takes decisions related to the incident on the basis of individual and group
decisions.
3) Role play:
In this case also a problem situation is simulated asking the employee to assume the role of a particular
person in the situation. The participant interacts with other participants assuming different roles. The whole
play will be recorded and trainee gets an opportunity to examine their own performance.
4) In-basket method:
The employees are given information about an imaginary company, its activities and products, HR
employed and all data related to the firm. The trainee (employee under training) has to make notes,
delegate tasks and prepare schedules within a specified time. This can develop situational judgments and
quick decision making skills of employees.
5) Business games:
According to this method the trainees are divided into groups and each group has to discuss about various
activities and functions of an imaginary organization. They will discuss and decide about various subjects
like production, promotion, pricing etc. This gives result in co-operative decision making process.
6) Grid training:
It is a continuous and phased programme lasting for six years. It includes phases of planning development,
implementation and evaluation. The grid takes into consideration parameters like concern for people and
concern for people.
7) Lectures:
This will be a suitable method when the numbers of trainees are quite large. Lectures can be very much
helpful in explaining the concepts and principles very clearly, and face to face interaction is very much
possible.
8) Simulation:
Under this method an imaginary situation is created and trainees are asked to act on it. For e.g., assuming
the role of a marketing manager solving the marketing problems or creating a new strategy etc.
9) Management education:
At present universities and management institutes gives great emphasis on management education. For e.g.,
Mumbai University has started bachelors and postgraduate degree in Management. Many management

Institutes provide not only degrees but also hands on experience having collaboration with business
concerns.
10) Conferences:
A meeting of several people to discuss any subject is called conference. Each participant contributes by
analyzing and discussing various issues related to the topic. Everyone can express their own view point.
Topic- 6 Succession planning
Succession planning is an ongoing process that identifies necessary competencies, then works to assess, develop,
and retain a talent pool of employees, in order to ensure a continuity of leadership for all critical positions.
Succession planning is a specific strategy, which spells out the particular steps to be followed to achieve the
mission, goals, and initiatives identified in workforce planning. It is a plan that managers can follow, implement,
and customize to meet the needs of their organisation, division, and/or department.
Succession planning establishes a process to recruit employees, develop their skills, and prepare them for
advancement, all while retaining them to ensure a return on the organization's training investment. Succession
planning involves understanding the organization's long-term goals and objectives, identifying employee
development needs, and determining trends.
Succession planning is the process of developing talent to replace executive, leadership or other key employees
when they transition to another role, leave the company, are fired, retire or die. It is relevant to all companies, from
the largest to the smallest, in both the for-profit and not-for-profit sectors. The planning process is meant to create
a talent pipeline of successors that will keep the organization running with little to no interruption when inevitable
staff changes occur.
The continued existence of an organization over time require a succession of persons to fill key position. The
purpose of succession planning is to identify and develop people to replace current incumbents in key position for a
variety of reasons. Some of these reasons are given below:
o Superannuation: Employees retiring because they reach a certain age.
o Resignation: Employees leaving their current job to join a new job
o Promotion: Employees moving upward in the hierarchy of the organization.
o Diversification: Employees being redeployed to new activities.
o Creation of New Position: Employees getting placed in new positions at the same level.
Comparison Chart
BASIS FOR
COMPARISON
CAREER PLANNING SUCCESSION PLANNING
Meaning Career Planning is the process through
which an individual selects the goals of
his work life and finds ways to reach the
goals.
Succession Planning is a process who
tends to spot and develop the employees,
that can occupy the key positions in the
organization, when they become vacant.
Subset of Career Management Succession Management
What is it? Individual Planning Organizational Strategy
Position One employee holds different positions,
in his/her work life.
One position is held by different
employees, over a period of time.
Ensures Success in one's career. Continuity in leadership for all key
positions.
Reasons of succession planning
The need for succession planning and its benefits are closely related, with benefits speaking to the reasons
succession planning is necessary. As to the latter, those reasons include:

1) The time needed to find an employee's replacement costs lost productivity, time and money. For the top
executive at a large public company, this can run upwards of $1 billion, according to a 2016 article
in Harvard Business Review.
2) More baby boomers are retiring, and fewer employees are available with the skill set to replace senior
executives.
3) During periods when a candidate-driven market exists, companies must compete for a scarcity of talent,
particularly for top talent, which makes hiring desired candidates more difficult.
Benefits of succession planning
Succession planning helps to manage these factors and provides numerous benefits, including:
1) boosting employee engagement through career development and making workers feel valued;
2) helping the organization create a better reputation as a talent destination;
3) saving money by filling key roles more quickly and providing for smoother business operations and
delivery of uninterrupted excellence;
4) helping to align HR and the vision for the organization, and supporting HR and managers in creating and
supporting proactive programs; and
5) supporting cross-functional cooperation.
Topic- 7 Compensation Management
Compensation management is a critical part of talent management and employee retention. It uses financial and
nonmonetary benefits to attract recruits, reduce turnover, spur performance and boost employee engagement. It is
responsible for ensuring that salary and bonuses remain competitive and benefit programs change with the needs of
the workforce. The people in this role not only work with data, but are also keen to understanding the complexity
of benefits administration.
Objectives of compensation management:
1) To Attract Top Talent
Rai University states that one of the primary goals of compensation should be to recruit qualified talent.
When you have a competitive compensation plan in place, you’ll be better able to attract top industry
talent.
2) To Retain & Reward Personnel
Don’t lose your top talent to your competitors because employees believe that the grass will be greener
elsewhere. Find out market values for your employees and pay accordingly. You can also set up pay-for-
performance models to drive performance by encouraging associates to reach new goals and push farther.
3) To Boost Motivation
When structured effectively, your compensation plan can drive motivation across your teams. Employees
who know that they’re being fairly compensated for their work feel appreciated and are therefore more
likely to stay engaged, committed, and productive. A well-developed compensation plan can also increase
job satisfaction.
4) To Be Compliant
Compensation isn’t just about being fair within the industry; it must also comply with federal regulations,
such as the Fair Labour Standards Act. While adhering to standards can complicate your compensation
management, it will help protect your company against litigation and ensure fairness across the board for
your personnel.
5) To Maximize ROI
It requires some fine tuning, but compensation management is most effective when you get the biggest
bang for your buck. In other words, if you can create a compensation plan that stays within budget while
also driving productivity through pay-for-performance and other motivational tactics, you’re creating a
plan that’s both equitable for the company and advantageous for hardworking employees.
Compensation and benefits components
There can be several ways where benefits can be given to employees. Mostly it is given in terms of a CTC or gross
salary. Some of the various components of compensation and benefits are mentioned below:
1) Fixed pay: This is the basic salary paid to the employee irrespective of any other factor. This is stated
clearly in the employment contract. This is the compensation or salary or wage which an employee or a
worker will definitely get as long as he or she is an employee of the company

2) Variable Pay: This is the additional compensation paid to employee based on employee’s performance,
company performance etc. Since variable pay is based on the performance of an individual, it motivates
the employees to perform even better.
3) Equity Pay: Employees are awarded shares of the company, often at a discounted price. Employees are
expected to make money out of them by the appreciation of the stock price and the growth of the
company. This is mostly given to the senior management who have served the company for a long time
4) Other benefits: Benefits such as medical facilities, insurance policies, company owned car of flat etc all
play an important role in motivating employees. These benefits are given by the company as a part of
recognizing the services of an employee.
Comparison Chart
BASIS FOR
COMPARISON
COMPENSATION BENEFITS
Meaning Compensation connotes the total earnings
received by the employees, both as financial
rewards and benefits.
Benefits implies the non-financial
rewards offered by the employer to the
employee in exchange for the service
provided by him/her.
Consideration Cash or kind In kind
Nature Direct Indirect
Tax Fully taxable or partially exempt. Exempt or partially exempt
Objective To attract and retain qualified personnel. To motivate employees, for raising
their performance.
Topic -8 Concept of job evaluation:
In simple words, job evaluation is the rating of jobs in an organisation. This is the process of establishing the value
or worth of jobs in a job hierarchy. It attempts to compare the relative intrinsic value or worth of jobs within an
organisation. Thus, job evaluation is a comparative process.
According to the International Labour Office (ILO) “Job evaluation is an attempt to determine and compare the
demands which the normal performance of a particular job makes on normal workers, without taking into account
the individual abilities or performance of the workers concerned”.
Features of Job Evaluation
The primary objective of job evaluation is to find out the value of work, but this is a value which varies from time
to time and from place to place under the influence of certain economic pressure, not least of which is the worth of
money itself. The main features of job evaluations are:
1) To supply bases for wage negotiation founded on facts rather than on vague intermediate ideas.
2) It attempts to assess jobs, not people.
3) Job evaluation is the output provided by job analysis.
4) Job evaluation does not design wage structure, it helps in rationalising the system by reducing number of
separate and different rates.
5) Job evaluation is not made by individuals rather it is done by group of experts.
6) Job evaluation determines the value of job. Further the value of each of the aspects such as skill and
responsibility levels are also related and studied in connection with the job.
7) Job evaluation helps the management to maintain high levels of employee productivity and employee
satisfaction.

The objectives of job evaluation
1) To establish an orderly, rational, systematic structure of jobs based on their worth to the organization.
2) To justify an existing pay rate structure or to develop one that provides for internal equity.
3) To assist in setting pay rates that are comparable to those of in similar jobs in other organizations to
compete in market place for best talent.
4) To provide a rational basis for negotiating pay rates when bargaining collectively with a recognized union.
5) To ensure the fair and equitable compensation of employees in relation to their duties.
6) To ensure equity in pay for jobs of similar skill, effort, responsibility and working conditions by using a
system that consistently and accurately assesses differences in relative value among jobs and
7) To establish a framework of procedures to determine the grade levels and the consequent salary range for
new jobs or jobs which have evolved and changed.
8) To identify a ladder of progression for future movement to all employees interested in improving their
compensation.
9) To comply with equal pay legislation and regulations determining pay differences according to job content.
10) To develop a base for merit or pay-for-performance.
Advantages of Job evaluation
Job evaluation is a process of determining the relative worth of a job. It is a process which is helpful even for
framing compensation plans by the personnel manager. Job evaluation as a process is advantageous to a company
in many ways:
1) Reduction in inequalities in salary structure - It is found that people and their motivation is dependent
upon how well they are being paid. Therefore the main objective of job evaluation is to have external and
internal consistency in salary structure so that inequalities in salaries are reduced.
2) Specialization - Because of division of labour and thereby specialization, a large number of enterprises
have got hundred jobs and many employees to perform them. Therefore, an attempt should be made to
define a job and thereby fix salaries for it. This is possible only through job evaluation.
3) Helps in selection of employees - The job evaluation information can be helpful at the time of selection of
candidates. The factors that are determined for job evaluation can be taken into account while selecting the
employees.
4) Harmonious relationship between employees and manager - Through job evaluation, harmonious and
congenial relations can be maintained between employees and management, so that all kinds of salaries
controversies can be minimized.
5) Standardization - The process of determining the salary differentials for different jobs become
standardized through job evaluation. This helps in bringing uniformity into salary structure.
6) Relevance of new jobs - Through job evaluation, one can understand the relative value of new jobs in a
concern.
Limitations:
1) Though there are many ways of applying job evaluation in a flexible manner, rapid changes in technology
and in the supply of and demand for particular skills, create problems of adjustment that may need further
study.
2) When job evaluation results in substantial changes in the existing wage structure, the possibility of
implementing these changes in a relatively short period may be restricted by the financial limits within
which the firm has to operate.
3) When there are a large proportion of incentive workers, it may be difficult to maintain a reasonable and
acceptable structure of relative earnings.
4) The process of job rating is, to some extent, inexact because some of the factors and degrees can be
measured with accuracy.
5) Job evaluation takes a long time to complete, requires specialized technical personnel and is quite
expensive.
THE JOB EVALUATION PROCESS
Job analysis describes a job. Job evaluation develops a plan for comparing jobs in terms of those things the

organization considers important determinants of job worth. This process involves a number of steps that will be
briefly stated here and then discussed more fully.
a) Job Analysis.
The first step is a study of the jobs in the organization. Through job analysis, information on job content is
obtained, together with an appreciation of worker requirements for successful performance of the job. This
information is recorded in the precise, consistent language of a job description.
b) Compensable Factors.
The next step is deciding what the organization "is paying for" -- that is, what factor or factors place one job at a
higher level in the job hierarchy than another. These compensable factors are the yardsticks used to determine the
relative position of jobs. In a sense, choosing compensable factors is the heart of job evaluation. Not only do these
factors place jobs in the organization's job hierarchy, but they also serve to inform job incumbents which
contributions are rewarded.
What are Compensable factors?
1. Experience level- How much work experience is needed to perrform a jabo or the prior experience of the
employee, whether he has worked in similar industry previously or some other.
2. Educational qualifications- what are all the educational qualifications that are required for the job.
3. Working Condition- the working condition of the job in which the employee would be working (overall
environmental factors such as location, hazards and any extreme factors).
4. Confidential Data- the extent to which the employee is exposed to the confidential data.
5. Consequences of mistakes and errors- consequences of the mistake or error occurrence by the employees,
effects of those errors or mistake.
6. Complexity of duties- the difficulty level of the duties and task, whether too much decision making is involved
in job or not and judgement skills are required or not.
7. Responsibility- the extent of the responsibility the employee entitled to.
8. Mental and physical demands- the degree of concentration and the environment accordingly and level and
frequency of physical effort.
c) Developing the Method.
The third step in job evaluation is to select a method of appraising the organization's jobs according to the factor(s)
chosen. The method should permit consistent placement of the organization's jobs containing more of the factors
higher in the job hierarchy, than those jobs lower in the hierarchy.
d) Job Structure.
The fourth step is comparing jobs to develop a job structure. This involves choosing and assigning decision makers,
job category, level, and setting up the job hierarchy.

e) Wage Structure.
The final step is pricing the job structure to arrive at a wage structure. It is also known as a salary structure, a
system that determines how much an employee is to be paid as a salary or wage, based on one or more
compensable factors such as the employee's experience level, rank or level within the organization, the length of
time that the employee has stayed in organisation (total service), complexity of duties and the difficulty of the
specific work. performed.
JOB EVALUATION METHODS

After job analysis preparations of job descriptions comes the essential stage of job evaluation, namely, the
systematic comparison of jobs in order to establish a job hierarchy. The techniques which have been commonly
used tend to fall into one of the two main categories:
Non-analytical or Non-quantitative or summary methods
Analytical or quantitative methods.
Qualitative methods are:
1) Job Ranking
2) Job Classification or grading
Quantitative methods are:
1) Factor Comparison
2) Point rating or assessment
1. Ranking Method
In the ranking method of job evaluation, a whole job is compared with others and rank is provided on the basis of
this comparison. The usual process followed in this method is as under:
1) On the basis of job analysis, each member of the job evaluation committee ranks each job independently
either against the benchmark job or against all other jobs. The ranking is provided to the job on the basis of
this comparison.
2) In order to increase the reliability of ranking, this exercise is undertaken twice or thrice by the members.
3) If there are significant differences of opinions among the members about the ranking of a particular job, the
matter is settled by mutual consultation, or by working out the average.
Merits
1) Ranking method has certain facial merits. Some of these merits are as follows:
2) The method is comparatively simple, easily understandable, and mostly acceptable by labour unions. It is
suitable for comparatively smaller organisations which may not like to undertake more laborious exercises.
3) The method is less costly to undertake and maintain as compared to other systems.
Demerits
Since ranking method of job evaluation is qualitative and non-analytical. It suffers from the following limitations:
1) Ranking method is judgmental and, therefore, it is affected by personal preferences of job evaluators.
2) This method ranks various jobs in order of their relative worth. It does not specify the real difference
between two jobs. For example, the exact difference between job ranked at first and the job ranked at
second cannot be specified.
2. Grading Method
Job grading method also known as job classification method establishes various grades for different categories of
jobs. For example, jobs of an operative may be classified as unskilled, semi-skilled, skilled and highly-skilled.
The process followed in this method is as under:

1) At the initial stage. a number of job classes or grades is decided on the basis of job analysis. Job grades can
be determined on either of two bases. First, all jobs may first be ranked and their natural classes may be
determined. The description of each job class is prepared covering all jobs falling in a class. Second, the
job evaluation committee may prepare a series of job class description in advance on the basis of which
various jobs may be graded.
2) Different characteristics of each job are matched with description of job class and a job is placed in the
class with which it matches best.
Merits
Grading system of job evaluation particularly in government jobs is quite popular as this has certain merits over
the ranking method. These are as follows:
1) It is quite simple to operate and understand as the relevant information is provided by job analysis which
serves other purposes too.
2) Job evaluation done on grading method makes wage and salary determination easier as these are fixed in
terms of various grades of jobs.
Demerits
This system of job evaluation suffers with the following limitations:
1) Job grade description is vague and personal biases may distort job grading as the method is not based on
any scientific analysis.
2) There are chances of employees’ resistance when new clusters of jobs are prepared. This is evident by the
fad that government employees agitate when recommendations of a new pay commission come.
3. Point Method
Point method of job evaluation is widely used in business organisations. It is an analytical and quantitative
method which determines the relative worth of a job on the basis of points alloted to each specific factor of a job.
The sum total to these points allotted to various job factors is the worth of the job. This total is compared with that
of other jobs and relative worth of various jobs is determined.
4. Factor Comparison Method
This method, also known as key job method, was originally developed at the Philadelphia Rapid Transit Company,
USA by Eugene J.Benge in 1926 to overcome two major problems faced in point method of job evaluation.
viz. determining the relative importance of factors and describing their degrees. In this method, each factor of a job
is compared with the same factor of the other jobs or the key job either defined or existing one. When all factors
are compared, the final rating is arrived at by adding the value received at each comparison. For this purpose,
Benge identified five factors – mental effort, skill, physical effort, responsibility and working conditions. The
procedure for factor comparison method of job evaluationis as follows:
1) At the initial stage, some key jobs which are well recognized are selected. These jobs should be from a
cross-section of departments. These should represent all levels of wages and salaries which are considered
fair, both internally as well as externally.
2) Various factors of the jobs which are to be considered for comparison, should be identified. These factors
may be mental requirement. Skills, physical requirement, responsibility and working conditions.
3) Each factor of a job is compared with the same factor of the key job and rank is awarded. This exercise is
repeated for all other factors.
4) The relative worth of a job is determined by adding the ranks obtained by different factors of a job.
Sometimes, the rank is expressed in terms of monetary values and these values are added together to get
the correct wage rate for the job.
Merits
The factor comparison method is more systematic and analytical as compared to any other method and offers
following merits:
1) It provides more accurate information about the relative worth of a job as different comparable factors are
compared with key jobs.
2) Since only limited number of factors relevant for the effective job performance are compared, there are
reduced chances of overlapping.

3) Since the evaluation is more systematic and analytical, its logic can be accepted by trade unions and
workers.
Demerits
However, factor rating method has its own operational problems which restrict its adaptability. The major problems
are as follows:
1) This method is quite costly and time consuming to install and difficult to understand by those not fully
conversant with job evaluation process.
2) If wage rates are adopted for making comparison, the system may become obsolete very soon as there may
not be proportionate increase in wages for all jobs.
3) This system considers only limited factors of job for comparison. This may be a positive point so far as
avoidance of duplication and simplicity of procedure are concerned, but may ignore other factors which
may be important for the performance of the job.
Topic-9 Job Analysis
Job Analysis is a systematic exploration, study and recording the responsibilities, duties, skills, accountabilities,
work environment and ability requirements of a specific job. It also involves determining the relative importance of
the duties, responsibilities and physical and emotional skills for a given job. All these factors identify what a job
demands and what an employee must possess to perform a job productively.
Purpose of Job Analysis
Job Analysis plays an important role in recruitment and selection, job evaluation, job designing, deciding
compensation and benefits packages, performance appraisal, analyzing training and development needs, assessing
the worth of a job and increasing personnel as well as organizational productivity.
1) Recruitment and Selection: Job Analysis helps in determining what kind of person is required to perform
a particular job. It points out the educational qualifications, level of experience and technical, physical,
emotional and personal skills required to carry out a job in desired fashion. The objective is to fit a right
person at a right place.
2) Performance Analysis: Job analysis is done to check if goals and objectives of a particular job are met or
not. It helps in deciding the performance standards, evaluation criteria and individual’s output. On this
basis, the overall performance of an employee is measured and he or she is appraised accordingly.
3) Training and Development: Job Analysis can be used to assess the training and development needs of
employees. The difference between the expected and actual output determines the level of training that
need to be imparted to employees. It also helps in deciding the training content, tools and equipments to be
used to conduct training and methods of training.
4) Compensation Management: Of course, job analysis plays a vital role in deciding the pay packages and
extra perks and benefits and fixed and variable incentives of employees. After all, the pay package depends

on the position, job title and duties and responsibilities involved in a job. The process guides HR managers
in deciding the worth of an employee for a particular job opening.
5) Job Designing and Redesigning: The main purpose of job analysis is to streamline the human efforts and
get the best possible output. It helps in designing, redesigning, enriching, evaluating and also cutting back
and adding the extra responsibilities in a particular job. This is done to enhance the employee satisfaction
while increasing the human output.
What to Collect ?
o Job Content
o Job Context
o Job Requirements
Job Content: It contains information about various job activities included in a specific job. It is a detailed account
of actions which an employee needs to perform during his tenure. The following information needs to be collected
by a job analyst:
o Duties of an employee
o What actually an employee does
o Machines, tools and equipments to be used while performing a specific job
o Additional tasks involved in a job
o Desired output level (What is expected of an employee?)
o Type of training required
Fig 1.1 Categorization of Job Analysis Information
The content depends upon the type of job in a particular division or department. For example, job content of a
factory-line worker would be entirely different from that of a marketing executive or HR personnel.
Job Context: Job context refers to the situation or condition under which an employee performs a particular job.
The information collection will include:
o Working Conditions
o Risks involved
o Whom to report
o Who all will report to him or her
o Hazards
o Physical and mental demands
o Judgment

Well like job content, data collected under this category are also subject to change according to the type of job in a
specific division or department.
Job Requirements: These include basic but specific requirements which make a candidate eligible for a particular
job. The collected data includes:
o Knowledge or basic information required to perform a job successfully
o Specific skills such as communication skills, IT skills, operational skills, motor skills, processing skills and
so on
o Personal ability including aptitude, reasoning, manipulative abilities, handling sudden and unexpected
situations, problem-solving ability, mathematical abilities and so on
o Educational Qualifications including degree, diploma, certification or license
o Personal Characteristics such as ability to adapt to different environment, endurance, willingness, work
ethic, eagerness to learn and understand things, behaviour towards colleagues, subordinates and seniors,
sense of belongingness to the organization, etc
Advantages and Disadvantages of Job Analysis
Though job analysis plays a vital role in all other human related activities but every process that has human interventions also suffers from some
limitations. The process of job analysis also has its own constraints. So, let us discuss the advantages and disadvantages of job analysis process at
length.
Advantages of Job Analysis
1) Provides First Hand Job-Related Information: The job analysis process provides with valuable job-related
data that helps managers and job analyst the duties and responsibilities of a particular job, risks and hazards
involved in it, skills and abilities required to perform the job and other related info.
2) Helps in Creating Right Job-Employee Fit: This is one of the most crucial management activities. Filling the
right person in a right job vacancy is a test of skills, understanding and competencies of HR managers. Job
Analysis helps them understand what type of employee will be suitable to deliver a specific job successfully.
3) Helps in Establishing Effective Hiring Practices: Who is to be filled where and when? Who to target and
how for a specific job opening? Job analysis process gives answers to all these questions and helps managers in
creating, establishing and maintaining effective hiring practices.
4) Guides through Performance Evaluation and Appraisal Processes: Job Analysis helps managers evaluating
the performance of employees by comparing the standard or desired output with delivered or actual output. On
these bases, they appraise their performances. The process helps in deciding whom to promote and when. It
also guides managers in understanding the skill gaps so that right person can be fit at that particular place in
order to get desired output.
5) Helps in Analyzing Training & Development Needs: The process of job analysis gives answer to following
questions:
o Who to impart training

o When to impart training
o What should be the content of training
o What should be the type of training: behavioral or technical
o Who will conduct training
6) Helps in Deciding Compensation Package for a Specific Job: A genuine and unbiased process of job
analysis helps managers in determining the appropriate compensation package and benefits and allowances for
a particular job. This is done on the basis of responsibilities and hazards involved in a job.
Disadvantages of Job Analysis
1) Time Consuming: The biggest disadvantage of Job Analysis process is that it is very time consuming. It is a
major limitation especially when jobs change frequently.
2) Involves Personal Biasness: If the observer or job analyst is an employee of the same organization, the
process may involve his or her personal likes and dislikes. This is a major hindrance in collecting genuine and
accurate data.
3) Source of Data is Extremely Small: Because of small sample size, the source of collecting data is extremely
small. Therefore, information collected from few individuals needs to be standardized.
4) Involves Lots of Human Efforts: The process involves lots of human efforts. As every job carries different
information and there is no set pattern, customized information is to be collected for different jobs. The process
needs to be conducted separately for collecting and recording job-related data.
5) Job Analyst May Not Possess Appropriate Skills: If job analyst is not aware of the objective of job analysis
process or does not possess appropriate skills to conduct the process, it is a sheer wastage of company’s
resources. He or she needs to be trained in order to get authentic data.
6) Mental Abilities Can not be Directly Observed: Last but not the least, mental abilities such as intellect,
emotional characteristics, knowledge, aptitude, psychic and endurance are intangible things that can not be
observed or measured directly. People act differently in different situations. Therefore, general standards can
not be set for mental abilities.
Topic-10 Job Description and Job Specification
Job Analysis is a primary tool to collect job-related data. The process results in collecting and recording two data
sets including job description and job specification. Any job vacancy can not be filled until and unless HR manager
has these two sets of data. It is necessary to define them accurately in order to fit the right person at the right place
and at the right time. This helps both employer and employee understand what exactly needs to be delivered and
how.
Both job description and job specification are essential parts of job analysis information. Writing them clearly and
accurately helps organization and workers cope with many challenges while onboard.

Though preparing job description and job specification are not legal requirements yet play a vital role in getting the
desired outcome. These data sets help in determining the necessity, worth and scope of a specific job.
Job Description
Job description includes basic job-related data that is useful to advertise a specific job and attract a pool of talent. It
includes information such as job title, job location, reporting to and of employees, job summary, nature and
objectives of a job, tasks and duties to be performed, working conditions, machines, tools and equipments to be
used by a prospective worker and hazards involved in it.
Purpose of Job Description
1) The main purpose of job description is to collect job-related data in order to advertise for a particular job. It
helps in attracting, targeting, recruiting and selecting the right candidate for the right job.
2) It is done to determine what needs to be delivered in a particular job. It clarifies what employees are
supposed to do if selected for that particular job opening.
3) It gives recruiting staff a clear view what kind of candidate is required by a particular department or
division to perform a specific task or job.
4) It also clarifies who will report to whom.
Job Description Components
A Job description will include the following:
o Roles and responsibilities of the job
o Goals of the organization as well the goals to be achieved as a part of the profile
o Qualifications in terms of education and work experience required have to be clearly mentioned
o Skill sets required to fulfill the job
o Salary range of the job
Advantages of Job Description
There are many benefits of having a comprehensive job description given by a company. Some of the advantages
of job description are mentioned below:
1) Helps companies understand the type of candidate they should search for based on title, position and
location
2) Employees are well aware about their job roles & duties
3) Job description helps in understanding the workplace environment, benefits etc for a prospective employee
4) Helps in better recruitment & selection
5) Job description clearly highlights all the requirements, objectives & goals that it wants an employee to
perform
Disadvantages of Job Description
Despite being a thorough documentation related to the job, there are certain limitation of job description:

1) Job descriptions are time bound and can change with organization structure, industry policies, company
requirements etc
2) It can only highlight the macro criteria of a job but cannot fully explain the obstacles, emotional requirements
etc related to the job
3) Incomplete job description lacking quality information can misguide both the HR manager as well as the
employee
Hence, this concludes the definition of Job Description along with its overview.
Job Specification
Also known as employee specifications, a job specification is a written statement of educational qualifications, specific qualities, level of experience,
physical, emotional, technical and communication skills required to perform a job, responsibilities involved in a job and other unusual sensory
demands. It also includes general health, mental health, intelligence, aptitude, memory, judgment, leadership skills, emotional ability, adaptability,
flexibility, values and ethics, manners and creativity, etc.
Purpose of Job Specification
o Described on the basis of job description, job specification helps candidates analyze whether are eligible to
apply for a particular job vacancy or not.
o It helps recruiting team of an organization understand what level of qualifications, qualities and set of
characteristics should be present in a candidate to make him or her eligible for the job opening.
o Job Specification gives detailed information about any job including job responsibilities, desired technical
and physical skills, conversational ability and much more.
o It helps in selecting the most appropriate candidate for a particular job.
Job description and job specification are two integral parts of job analysis. They define a job fully and guide both
employer and employee on how to go about the whole process of recruitment and selection. Both data sets are
extremely relevant for creating a right fit between job and talent, evaluate performance and analyze training needs
and measuring the worth of a particular job.
Comparison Chart
BASIS FOR
COMPARISON
JOB DESCRIPTION JOB SPECIFICATION
Meaning Job Description is a concise written
statement, explaining about what are the
major requirements of a particular job.
The statement which explains the minimum
eligibility requirements, for performing a
particular job is known as Job
Specification.
Lists out Job title, duties, tasks and responsibilities
involved in a job.
Employee's qualification, skills and
abilities.
What is it? It expresses what a prospective employee
must do when he will get the placement
It expresses what an applicant must possess
for getting selected.
Prepared from Job Analysis Job Description
Describes Jobs Job Holders
Comprises of Designation, place of work, scope, salary
range, working hours, responsibilities,
reporting authority etc.
Educational qualifications, experience,
skills, knowledge, age, abilities, work
orientation factors, etc.
Topic – 11 Performance Appraisal
Definition: Performance Appraisal is defined as a systematic process, in which the personality and performance of
an employee is assessed by the supervisor or manager, against predefined standards, such as knowledge of the job,
quality and quantity of output, leadership abilities, attitude towards work, attendance, cooperation, judgment,
versatility, health, initiative and so forth.

Relationship of Performance Appraisal and Job Analysis
Performance Appraisal relates to job analysis, in the sense that job analysis establishes job requirement, which
converts the analysis into standard, on which performance is judged, and results in defining the basis for
performance appraisal.
Objectives of Performance Appraisal
o To promote the employees, on the basis of performance and competence.
o To identify the requirement for training and development of employees.
o To provide confirmation to those employees who are hired as probationary employees, upon completion of
the term.
o To take a decision regarding the hike in employees pay, incentives etc.
o To facilitate communication between superior and subordinate.
o To help employees in understanding where they stand in terms of performance.
Data obtained from the appraisal of performance, are documented and used for different organizational purposes.
Performance Appraisal Process
The figure shown above is a standard performance appraisal process that takes place in an organization, wherein
each step is important and arranged in a systematic manner. The process is conducted periodically, usually twice a
year, i.e. semi-annually and annually called as mid-term review and annual review respectively.

Method of Performance Appraisal
In the process of designing performance appraisal process, it is important to identify the best method for
assessment. There are a number of methods introduced to gauge the quantity and quality of work performed by an
individual. These methods are broadly classified into two categories:
➢ Past-oriented Methods (Also known as Traditional Methods of Performance Appraisal)
▪ Rating Scales
▪ Checklists
▪ Forced Choice
▪ Forced Distribution
▪ Critical Incident
▪ Performance test and observation
▪ Field review
▪ Confidential Record
▪ Essay method
▪ Comparative Evaluation Approaches
▪ Cost Accounting Method
▪ Behaviorally Anchored Rating Scales
➢ Future Oriented Methods (Also known as Modern Methods of Performance Appraisal)
▪ Management by objectives
▪ Psychological Appraisal
▪ Assessment Centres
▪ 360-Degree Feedback
▪ 720-Degree Feedback
Performance Appraisal is a part of performance management. It helps in gaining the competitive edge, by
improving the performance level of the employees working in the organization, making rational decisions
regarding hike in salaries, promotions, transfers, discharge of the employees, reducing job dissatisfaction and
employee turnover.
Past Oriented Methods
1) Rating Scales: Rating scales consists of several numerical scales representing job related performance
criterions such as dependability, initiative, output, attendance, attitude etc. Each scales ranges from
excellent to poor. The total numerical scores are computed and final conclusions are derived.
➢ Advantages – Adaptability, easy to use, low cost, every type of job can be evaluated, large number
of employees covered, no formal training required.
➢ Disadvantages – Rater’s biases
2) Checklist: Under this method, checklist of statements of traits of employee in the form of Yes or No based
questions is prepared. Here the rater only does the reporting or checking and HR department does the actual
evaluation.
➢ Advantages – economy, ease of administration, limited training required, standardization.
➢ Disadvantages – Raters biases, use of improper weighs by HR, does not allow rater to give relative
ratings
3) Forced Choice Method: The series of statements arranged in the blocks of two or more are given and the
rater indicates which statement is true or false. The rater is forced to make a choice. HR department does
actual assessment.
➢ Advantages – Absence of personal biases because of forced choice.
➢ Disadvantages – Statements may be wrongly framed.

4) Forced Distribution Method: here employees are clustered around a high point on a rating scale. Rater is
compelled to distribute the employees on all points on the scale. It is assumed that the performance is
conformed to normal distribution.
➢ Advantages – Eliminates
➢ Disadvantages – Assumption of normal distribution, unrealistic, errors of central tendency.
5) Critical Incidents Method: The approach is focused on certain critical behaviours of employee that makes
all the difference in the performance. Supervisors as and when they occur record such incidents.
➢ Advantages – Evaluations are based on actual job behaviours, ratings are supported by
descriptions, feedback is easy, reduces regency biases, chances of subordinate improvement are
high.
➢ Disadvantages – Negative incidents can be prioritized, forgetting incidents, overly close
supervision; feedback may be too much and may appear to be punishment.
6) Behaviourally Anchored Rating Scales: statements of effective and ineffective behaviours determine the
points. They are said to be behaviourally anchored. The rater is supposed to say, which behaviour describes
the employee performance.
➢ Advantages – helps overcome rating errors.
➢ Disadvantages – Suffers from distortions inherent in most rating techniques.
7) Field Review Method: This is an appraisal done by someone outside employees’ own department usually
from corporate or HR department.
➢ Advantages – Useful for managerial level promotions, when comparable information is needed,
➢ Disadvantages – Outsider is generally not familiar with employees work environment, Observation
of actual behaviours not possible.
8) Performance Tests & Observations: This is based on the test of knowledge or skills. The tests may be
written or an actual presentation of skills. Tests must be reliable and validated to be useful. Advantage –
Tests may be apt to measure potential more than actual performance.
Disadvantages – Tests may suffer if costs of test development or administration are high.
9) Confidential Records: Mostly used by government departments, however its application in industry is not
ruled out. Here the report is given in the form of Annual Confidentiality Report (ACR) and may record
ratings with respect to following items; attendance, self expression, team work, leadership, initiative,
technical ability, reasoning ability, originality and resourcefulness etc. The system is highly secretive and
confidential. Feedback to the assessee is given only in case of an adverse entry.
Disadvantage is that it is highly subjective and ratings can be manipulated because the evaluations are
linked to HR actions like promotions etc.
10) Essay Method: In this method the rater writes down the employee description in detail within a number of
broad categories like, overall impression of performance, promoteability of employee, existing capabilities
and qualifications of performing jobs, strengths and weaknesses and training needs of the employee.
➢ Advantage – It is extremely useful in filing information gaps about the employees that often occur
in a better-structured checklist.
➢ Disadvantages – It its highly dependent upon the writing skills of rater and most of them are not
good writers. They may get confused success depends on the memory power of raters.
11) Cost Accounting Method: Here performance is evaluated from the monetary returns yields to his or her
organization. Cost to keep employee, and benefit the organization derives is ascertained. Hence it is more
dependent upon cost and benefit analysis.
12) Comparative Evaluation Method (Ranking & Paired Comparisons): These are collection of different
methods that compare performance with that of other co-workers. The usual techniques used may be
ranking methods and paired comparison method.
o Ranking Methods: Superior ranks his worker based on merit, from best to worst. However how best
and why best are not elaborated in this method. It is easy to administer and explanation.
o Paired Comparison Methods: In this method each employee is rated with another employee in the
form of pairs. The number of comparisons may be calculated with the help of a formula as under.
N x (N-1) / 2

Future Oriented Methods
1) Management By Objectives: It means management by objectives and the performance is rated against the
achievement of objectives stated by the management. MBO process goes as under.
a) Establish goals and desired outcomes for each subordinate
b) Setting performance standards
c) Comparison of actual goals with goals attained by the employee
d) Establish new goals and new strategies for goals not achieved in previous year.
o Advantage – It is more useful for managerial positions.
o Disadvantages – Not applicable to all jobs, allocation of merit pay may result in setting short-term goals
rather than important and long-term goals etc.
2) Psychological Appraisals: These appraisals are more directed to assess employees potential for future
performance rather than the past one. It is done in the form of in-depth interviews, psychological tests, and
discussion with supervisors and review of other evaluations. It is more focused on employees emotional,
intellectual, and motivational and other personal characteristics affecting his performance. This approach is
slow and costly and may be useful for bright young members who may have considerable potential. However
quality of these appraisals largely depend upon the skills of psychologists who perform the evaluation.
3) Assessment Centres: This technique was first developed in USA and UK in 1943. An assessment centre is a
central location where managers may come together to have their participation in job related exercises
evaluated by trained observers. It is more focused on observation of behaviours across a series of select
exercises or work samples. Assesses are requested to participate in in-basket exercises, work groups, computer
simulations, role playing and other similar activities which require same attributes for successful performance
in actual job. The characteristics assessed in assessment centre can be assertiveness, persuasive ability,
communicating ability, planning and organizational ability, self confidence, resistance to stress, energy level,
decision making, sensitivity to feelings, administrative ability, creativity and mental alertness etc.
➢ Disadvantages – Costs of employees travelling and lodging, psychologists, ratings strongly influenced by
assessor’s inter-personal skills. Solid performers may feel suffocated in simulated situations. Those who
are not selected for this also may get affected.
➢ Advantages – well-conducted assessment centre can achieve better forecasts of future performance and
progress than other methods of appraisals. Also reliability, content validity and predictive ability are said to
be high in assessment centres. The tests also make sure that the wrong people are not hired or promoted.
Finally it clearly defines the criteria for selection and promotion.
4) 360-Degree Feedback: It is a technique which is systematic collection of performance data on an individual
group, derived from a number of stakeholders like immediate supervisors, team members, customers, peers and
self. In fact anyone who has useful information on how an employee does a job may be one of the appraisers.
This technique is highly useful in terms of broader perspective, greater self-development and multi-source
feedback is useful. 360-degree appraisals are useful to measure inter-personal skills, customer satisfaction and
team building skills. However on the negative side, receiving feedback from multiple sources can be
intimidating, threatening etc. Multiple raters may be less adept at providing balanced and objective feedback.
Meaning of 360 Degree Appraisal
An appraisal made by top management, immediate superior, peers, subordinates, self and customers is called 360
Degree Appraisal. Here, the performance of the employee or manager is evaluated by six parties, including himself.
So, he gets a feedback of his performance from everyone around him. This method is very reliable because
evaluation is done by many different parties. These parties are in the best position to evaluate the employee or
manager because they are continuously interacting and working with him. This method is mostly used to evaluate
the performance of the employees. However, it is also used to evaluate other qualities such as talents, behaviour,
values, ethical standards, tempers, loyalty, etc.
Six Parties In 360 Degree Appraisal

The six parties involved in 360 degree appraisal are :-
1. Top Management
The top management normally evaluates the middle level managers. However, in a small organisation, they also
evaluate the performance of the lower level managers and senior employees.
2. Immediate Superior
The immediate superior is in a very good position to evaluate the performance of his subordinates. This is because
they have direct and accurate information about the work performance of their subordinates.
3. Peers / Co-workers
Peer or colleagues also evaluate each other's performance. They work continuously with each other, and they know
each other's performance. Peer evaluation is used mostly in cases where team work is important.
4. Subordinates
The Subordinates can also evaluate the performance of his superior. Now-a-days students are asked to evaluate the
performance of their teachers.
5. Self Appraisal
In the self-appraisal, a person evaluates his own performance. He should be honest while evaluating himself. This
results in self-development.
6. Customers
Customers can also evaluate the performance of the employees who interacts with them. This evaluation is best
because it is objective. It is also given a lot of importance because the customer is the most important person for the
business. Organisations use customer appraisals to improve the strengths and remove the weaknesses of their
employees.
Topic – 12 Collective Bargaining
The National Labor Relations Act, or “NLRA,” was established in 1935. The Act set the standards for U.S.
labor laws, which guarantee employees certain basic rights, such as the right to organize into trade unions, and

the ability to engage in collective bargaining negotiations. The Act requires officials elected to head a union to
meet with the employer to negotiate conditions. Specific rules in support of collective bargaining include:
o There is a limit of one representative for each unit of employees
o All representatives must promote the practice, and follow all procedures, of collective bargaining
o Employers must bargain with the employees’ representatives
o Employees and their representatives have the right to discuss wage issues
Not all employers and employees are covered under the act. For example, independent contractors and government
workers are excluded from the NLRA. However, the Act does stipulate that these workers cannot be prevented
from joining labour unions if they wish to do so.
Definition of Collective Bargaining:
Industrial disputes between the employee and employer can also be settled by discussion and negotiation between
these two parties in order to arrive at a decision. This is also commonly known as collective bargaining as both the
parties eventually agree to follow a decision that they arrive at after a lot of negotiation and discussion.
Unfair Labour Practices
Part of the National Labour Relations Act’s responsibilities includes ensuring employers do not engage in unfair
labour practices. Under the Act, employers are obligated to follow certain laws, and are prohibited from certain
actions, including:
o Interfering with, coercing, or restraining employees’ right to form, join, or assist in the formation of labour
organizations
o Dominating or interfering with the formation of any labor union organization
o Discrimination in hiring or tenure of employees in order to discourage participation in union organization
o Discriminating against any employee who files charges or testifies against the employer
o Refusing to bargain with the employee’s representative
The National Labour Relations Board
The National Labor Relations Board (“NLRB”) was formed in 1935 to oversee compliance with the National Labor
Relations Act. This federal agency is charged with managing legal disputes between employees and an employer.
The agency is also responsible for taking action against employers in violation of the NLRA.
Main Features of Collective Bargaining:
Some of the salient features of collective bargaining are:
1) It is a Group Action:
Collective bargaining is a group action as opposed to individual action. Both the parties of settlement are
represented by their groups. Employer is represented by its delegates and, on the other side; employees are
represented by their trade union.
2) It is a Continuous Process:
Collective bargaining is a continuous process and does not end with one agreement. It provides a
mechanism for continuing and organised relationship between management and trade union. It is a process
that goes on for 365 days of the year.
3) It is a Bipartite Process:
Collective bargaining is a two party process. Both the parties—employers and employees— collectively
take some action. There is no intervention of any third party. It is mutual given-and-take rather than take-it-
or-leave-it method of arriving at the settlement of a dispute.
4) It is a Process:
Collective bargaining is a process in the sense that it consists of a number of steps. The starting point is the
presentation of charter of demands by the workers and the last step is the reaching of an agreement, or a
contract which would serve as the basic law governing labour-management relations over a period of time
in an enterprise.
5) It is Flexible and Mobile and not Fixed or Static:
It has fluidity. There is no hard and fast rule for reaching an agreement. There is ample scope for
compromise. A spirit of give-and-take works unless final agreement acceptable to both the parties is
reached.

6) It is Industrial Democracy at Work:
Collective bargaining is based on the principle of industrial democracy where the labour union represents
the workers in negotiations with the employer or employers. Industrial democracy is the government of
labour with the consent of the governed—the workers. The principle of arbitrary unilateralism has given
way to that of self-government in industry. Actually, collective bargaining is not a mere signing of an
agreement granting seniority, vacations and wage increase, by sitting around a table.
7) It is Dynamic:
It is relatively a new concept, and is growing, expanding and changing. In the past, it used to be emotional,
turbulent and sentimental, but now it is scientific, factual and systematic.
8) It is a Complementary and not a Competitive Process:
Collective bargaining is not a competitive process i.e., labour and management do not coopt while
negotiating for the same object. It is essentially a complementary process i.e., each party needs something
which the other party has, namely, labour can put greater productive effort and management has the
capacity to pay for that effort and to organise and guide it for achieving the enterprise’s objectives
Collective Bargaining Process
The collective bargaining process involves five core steps:
1) Preparation – Choosing a negotiation team and representatives of both the union and employer. Both
parties should be skilled in negotiation and labor laws, and both examine available information to
determine whether they have a strong standing for negotiation.
2) Discussion – Both parties meet to set ground rules for the collective bargaining negotiation process.
3) Proposal – Both representatives make opening statements, outlining options and possible solutions to the
issue at hand.
4) Bargaining – Following proposals, the parties discuss potential compromises, bargaining to create an
agreement that is acceptable to both parties. This becomes a “draft” agreement, which is not legally
binding, but a stepping stone to coming to a final collective bargaining agreement.
5) Final Agreement – Once an agreement is made between the parties, it must be put in writing, signed by
the parties, and put into effect.
Related Legal Terms and Issues
o Coercing – persuading or forcing a person to do something through the use of manipulation or threats.
o Dues – the cost of membership when a person joins a union or club. Dues many be required weekly, or
annually.
o Grievance – a formal complaint filed by an employee or agent. Some employers or agencies have specific
procedures that must be followed.
o Independent Contractor – a person who agrees to do work for someone else using his own methods.
o Layoff – a permanent or temporary discharge of employees.
o Strike – the act of employees organizing and protesting employment practices in an attempt to induce
changes.
o Union – an organized group of employees that is formed to protect workers from unfair labour practices.
Topic-13 Workers Participation In Management
Workers participation in management is an essential ingredient of Industrial democracy. The concept of workers
participation in management is based on Human Relations approach to Management which brought about a new set
of values to labour and management. Traditionally the concept of Workers Participation in Management refers to
participation of non-managerial employees in the decision-making process of the organization. Workers’
participation is also known as ‘labour participation’ or ‘employee participation’ in management. In Germany it is
known as co-determination while in Yugoslavia it is known as self-management. The International Labour
Organization has been encouraging member nations to promote the scheme of Workers’ Participation in
Management.
Workers’ participation in management implies mental and emotional involvement of workers in the management of
Enterprise. It is considered as a mechanism where workers have a say in the decision-making.
Definitions of Workers Participation In Management
According to Keith Davis, Participation refers to the mental and emotional involvement of a person in a group
situation which encourages him to contribute to group goals and share the responsibility of achievement.

Human Resource Management (UGC NET Commerce & Management

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