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Chapter THE STRATEGIC ROLE OF  HUMAN RESOURCES MANAGEMENT   EXCEL BOOKS 1-1 1
ANNOTATED OUTLINE   1-2 The Strategic Role Of Human Resources Management Introduction Organisations have to provide a healthy work climate in order to get the best out of people. To utilise the capabilities of people fully, you need competent leadership willing to recognise, reward and nurture talent at all levels.  This is where human resource managers play a critical role by bridging gaps between employee expectations and organisational requirements by adopting appropriate human resource strategies and practices. HRM, in short, is the art of procuring, developing and maintaining competent workforce to achieve the goals of an organisation in an effective and efficient manner.
Human Resource Management:   Features   1-3 The Strategic Role Of Human Resources Management ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
Important terms 1-4 The Strategic Role Of Human Resources Management ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],Clearing the Fog
Scope of HRM 1-5 The Strategic Role Of Human Resources Management ,[object Object],[object Object],[object Object],HRM mainly covers three broad areas
Objectives of HRM 1-6 The Strategic Role Of Human Resources Management HRM aims at achieving organisational goals, meet the expectations of employees; develop the knowledge, skills and abilities of employees; improve the quality of working life and manage human resources in an ethical and socially responsible manner. Importance of HRM From an organisational standpoint, good HR practices help in attracting and retaining talent, train people for challenging roles, develop their skills and competencies, increase productivity and profits and enhance standard of living
Importance of HRM 1-7 The Strategic Role Of Human Resources Management ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],Good HR Practices help
HRM as a central subsystem in an organisation 1-8 The Strategic Role Of Human Resources Management Product Subsystem HR Subsystem  Procurement Training Compensation Appraisal Rewards Marketing Subsystem Finance Subsystem Technical Subsystem
Functions of HRM 1-9 The Strategic Role Of Human Resources Management –   Planning  –  Organising –   Directing –  Controlling Operative Functions P/HRM Managerial functions: Procurement Job Analysis HR planning Recruitment Selection Placement Induction Internal mobility Development: Training Executive  development Career planning Succession planning Human resources development strategies Motivation and Compensation: Job design  Work scheduling Motivation Job evaluation Performance and potential appraisal Compensation  administration Incentives benefits and services Maintenance: Health Safety Welfare Social security Integration: Grievances Discipline Teams and teamwork Collective  bargaining  Participation Empowerment Trade unions Employers’  associations Industrial  relations Emerging Issues: Personnel records Personnel audit Personnel research HR accounting HRIS Job stress Mentoring International HRM
Strategic Human Resource Management 1-10 The Strategic Role Of Human Resources Management Competitive advantage through people? Competitive advantage allows a firm to gain an edge over its rivals when competing. It comes from a firm’s unique ability to perform activities more distinctively and more effectively than rivals.  HR can be a source of competitive advantage when the talents of people working in the firm are valuable, rare; difficult to imitate and well organised to deliver efficient and effective results.
The evolving strategic role of Human Resource Management 1-11 The Strategic Role Of Human Resources Management Strategic focus Operational focus People  System  Strategic partner    Change agent Administrative expert   Employee champion
Strategic Human Resource Management  1-12 The Strategic Role Of Human Resources Management Realising the growing importance of HR, a new line of thinking emerged elevating the status of HR to that of a strategic partner both in the formulation of a firm’s strategic as well as in the implementation of business activities.  SHRM, simply stated, is the linkage of HRM with strategic goals and objectives with a view to improve business performance and develop organisational cultures that foster innovation and flexibility.  Strategic HR differs radically from traditional HR in a number of ways:
Traditional HR vs. Strategic HR 1-13 The Strategic Role Of Human Resources Management Point of distinction Focus  Role of HR Initiatives  Time horizon Control Job design Key investments Accountability Responsibility for HR Traditional HR Employee Relations Transactional change follower and respondent Slow, reactive, fragmented Short-term Bureaucratic-roles, policies, procedures Tight division of labour; independence, specialisation Capital, products  Cost centre Staff specialists Strategic HR Partnerships with internal and external customers  Transformational change leader and initiator Fast, proactive and integrated Short, medium and long (as required) Organic-flexible, whatever is necessary to succeed Broad, flexible, cross-training teams People, knowledge Investment centre Line managers
EVOLUTION OF HRM ,[object Object],1-14 The Strategic Role Of Human Resources Management ,[object Object],[object Object],[object Object],[object Object],[object Object]
Evolution of the Personnel Function 1-15 The Strategic Role Of Human Resources Management Concept What is it all about? The Commodity concept Labour was regarded as a commodity to be bought and sold. Wages were based on demand and supply. Government did very little to protect workers. The Factor of Production concept Labour is like any other factor of production, viz, money, materials, land, etc. Workers are like machine tools. The Goodwill concept Welfare measures like safety, first aid, lunch room, rest room will have a positive impact on workers’ productivity The Paternalistic concept/ Paternalism Management must assume a fatherly and protective attitude towards employees. Paternalism does not mean merely providing benefits but it means satisfying various needs of the employees as parents meet the  requirements of the children. Cont…
Evolution of the Personnel Function 1-16 The Strategic Role Of Human Resources Management The Humanitarian concept To improve productivity, physical, social and psychological needs of workers must be met. As Mayo and others stated, money is less a factor in determining output, than group standards, group incentives and security. The organisation is a social system that has both economic and social dimensions. The Human Resource concept Employees are the most valuable assets of an organisation. There should be a conscious effort to realise organisational goals by satisfying needs and aspirations of employees. The Emerging concept Employees should be accepted as partners in the progress of a company. They should have a feeling that the organisation is their own. To this end, managers must offer better quality of working life and offer opportunities to people to exploit their potential fully. The focus should be on Human Resource Development.
Growth in India 1-17 The Strategic Role Of Human Resources Management ,[object Object],[object Object],[object Object]
Personnel Function in India; Changing Scenario  1-18 The Strategic Role Of Human Resources Management Period Emphasis   Status   Roles 1920 – 30 Welfare management Clerical Welfare  Paternalistic practices administrator 1990s – Incremental productivity Proactive,  Developer onwards  gains through human growth-oriented Counsellor assets  Coach   Mentor Problem solver 1940 – 60 Expanding the role to cover Administrative Appraiser Labour, Welfare, Industrial Advisor Relations and Personnel Mediator Administration Legal advisor Fire fighting 1970 – 80 Efficiency, effectiveness Developmental  Change agent dimensions added Integrator Emphasis on human Trainer values, aspirations,  Educator
Shifts in HR management in India 1-19 The Strategic Role Of Human Resources Management ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object]
HRM in the new millennium 1-21 The Strategic Role Of Human Resources Management Current thinking in HRM strongly supports the view that when opportunities for growth and enhancement of skills are available in an organisation, people will be stimulated to give their best, leading to greater job satisfaction and organisational effectiveness. To this end, therefore, HR managers in the new millennium are expected to successfully evolve an appropriate corporate culture, take a strategic approach to the acquisition, motivation and development of human resources and introduce programmes that reflect and support the core values of the organisation and its people.             Size of work force Demands for better pay, benefits, working conditions Cont…
HRM in the new millennium 1-21 The Strategic Role Of Human Resources Management ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],Cont…
HRM in the new millennium ,[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],[object Object],1-23 The Strategic Role Of Human Resources Management Cont…
HRM in the new millennium 1-23 The Strategic Role Of Human Resources Management    Changes in 21 st  century affecting HRM HR as a springboard for success Talent hunting, developing and retraining Lean and mean organisations Labour relations Health and benefit programmes

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SHRM

  • 1. Chapter THE STRATEGIC ROLE OF HUMAN RESOURCES MANAGEMENT EXCEL BOOKS 1-1 1
  • 2. ANNOTATED OUTLINE 1-2 The Strategic Role Of Human Resources Management Introduction Organisations have to provide a healthy work climate in order to get the best out of people. To utilise the capabilities of people fully, you need competent leadership willing to recognise, reward and nurture talent at all levels. This is where human resource managers play a critical role by bridging gaps between employee expectations and organisational requirements by adopting appropriate human resource strategies and practices. HRM, in short, is the art of procuring, developing and maintaining competent workforce to achieve the goals of an organisation in an effective and efficient manner.
  • 3.
  • 4.
  • 5.
  • 6. Objectives of HRM 1-6 The Strategic Role Of Human Resources Management HRM aims at achieving organisational goals, meet the expectations of employees; develop the knowledge, skills and abilities of employees; improve the quality of working life and manage human resources in an ethical and socially responsible manner. Importance of HRM From an organisational standpoint, good HR practices help in attracting and retaining talent, train people for challenging roles, develop their skills and competencies, increase productivity and profits and enhance standard of living
  • 7.
  • 8. HRM as a central subsystem in an organisation 1-8 The Strategic Role Of Human Resources Management Product Subsystem HR Subsystem Procurement Training Compensation Appraisal Rewards Marketing Subsystem Finance Subsystem Technical Subsystem
  • 9. Functions of HRM 1-9 The Strategic Role Of Human Resources Management – Planning – Organising – Directing – Controlling Operative Functions P/HRM Managerial functions: Procurement Job Analysis HR planning Recruitment Selection Placement Induction Internal mobility Development: Training Executive development Career planning Succession planning Human resources development strategies Motivation and Compensation: Job design Work scheduling Motivation Job evaluation Performance and potential appraisal Compensation administration Incentives benefits and services Maintenance: Health Safety Welfare Social security Integration: Grievances Discipline Teams and teamwork Collective bargaining Participation Empowerment Trade unions Employers’ associations Industrial relations Emerging Issues: Personnel records Personnel audit Personnel research HR accounting HRIS Job stress Mentoring International HRM
  • 10. Strategic Human Resource Management 1-10 The Strategic Role Of Human Resources Management Competitive advantage through people? Competitive advantage allows a firm to gain an edge over its rivals when competing. It comes from a firm’s unique ability to perform activities more distinctively and more effectively than rivals. HR can be a source of competitive advantage when the talents of people working in the firm are valuable, rare; difficult to imitate and well organised to deliver efficient and effective results.
  • 11. The evolving strategic role of Human Resource Management 1-11 The Strategic Role Of Human Resources Management Strategic focus Operational focus People System Strategic partner Change agent Administrative expert Employee champion
  • 12. Strategic Human Resource Management 1-12 The Strategic Role Of Human Resources Management Realising the growing importance of HR, a new line of thinking emerged elevating the status of HR to that of a strategic partner both in the formulation of a firm’s strategic as well as in the implementation of business activities. SHRM, simply stated, is the linkage of HRM with strategic goals and objectives with a view to improve business performance and develop organisational cultures that foster innovation and flexibility. Strategic HR differs radically from traditional HR in a number of ways:
  • 13. Traditional HR vs. Strategic HR 1-13 The Strategic Role Of Human Resources Management Point of distinction Focus Role of HR Initiatives Time horizon Control Job design Key investments Accountability Responsibility for HR Traditional HR Employee Relations Transactional change follower and respondent Slow, reactive, fragmented Short-term Bureaucratic-roles, policies, procedures Tight division of labour; independence, specialisation Capital, products Cost centre Staff specialists Strategic HR Partnerships with internal and external customers Transformational change leader and initiator Fast, proactive and integrated Short, medium and long (as required) Organic-flexible, whatever is necessary to succeed Broad, flexible, cross-training teams People, knowledge Investment centre Line managers
  • 14.
  • 15. Evolution of the Personnel Function 1-15 The Strategic Role Of Human Resources Management Concept What is it all about? The Commodity concept Labour was regarded as a commodity to be bought and sold. Wages were based on demand and supply. Government did very little to protect workers. The Factor of Production concept Labour is like any other factor of production, viz, money, materials, land, etc. Workers are like machine tools. The Goodwill concept Welfare measures like safety, first aid, lunch room, rest room will have a positive impact on workers’ productivity The Paternalistic concept/ Paternalism Management must assume a fatherly and protective attitude towards employees. Paternalism does not mean merely providing benefits but it means satisfying various needs of the employees as parents meet the requirements of the children. Cont…
  • 16. Evolution of the Personnel Function 1-16 The Strategic Role Of Human Resources Management The Humanitarian concept To improve productivity, physical, social and psychological needs of workers must be met. As Mayo and others stated, money is less a factor in determining output, than group standards, group incentives and security. The organisation is a social system that has both economic and social dimensions. The Human Resource concept Employees are the most valuable assets of an organisation. There should be a conscious effort to realise organisational goals by satisfying needs and aspirations of employees. The Emerging concept Employees should be accepted as partners in the progress of a company. They should have a feeling that the organisation is their own. To this end, managers must offer better quality of working life and offer opportunities to people to exploit their potential fully. The focus should be on Human Resource Development.
  • 17.
  • 18. Personnel Function in India; Changing Scenario 1-18 The Strategic Role Of Human Resources Management Period Emphasis Status Roles 1920 – 30 Welfare management Clerical Welfare Paternalistic practices administrator 1990s – Incremental productivity Proactive, Developer onwards gains through human growth-oriented Counsellor assets Coach Mentor Problem solver 1940 – 60 Expanding the role to cover Administrative Appraiser Labour, Welfare, Industrial Advisor Relations and Personnel Mediator Administration Legal advisor Fire fighting 1970 – 80 Efficiency, effectiveness Developmental Change agent dimensions added Integrator Emphasis on human Trainer values, aspirations, Educator
  • 19.
  • 20. HRM in the new millennium 1-21 The Strategic Role Of Human Resources Management Current thinking in HRM strongly supports the view that when opportunities for growth and enhancement of skills are available in an organisation, people will be stimulated to give their best, leading to greater job satisfaction and organisational effectiveness. To this end, therefore, HR managers in the new millennium are expected to successfully evolve an appropriate corporate culture, take a strategic approach to the acquisition, motivation and development of human resources and introduce programmes that reflect and support the core values of the organisation and its people.            Size of work force Demands for better pay, benefits, working conditions Cont…
  • 21.
  • 22.
  • 23. HRM in the new millennium 1-23 The Strategic Role Of Human Resources Management  Changes in 21 st century affecting HRM HR as a springboard for success Talent hunting, developing and retraining Lean and mean organisations Labour relations Health and benefit programmes